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 November 30, 2014
or
o		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: 0-12182
________________

CALAMP CORP.
(Exact name of Registrant as specified in its Charter)

Delaware	95-3647070
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
1401 N. Rice Avenue
Oxnard, California	93030
(Address of principal executive offices)	(Zip Code)

(805) 987-9000
(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. Yes x   No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x   No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o	Accelerated filer x
Non-accelerated filer o	Smaller reporting company o
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o   No x

The number of shares outstanding of the registrant’s common stock as of December 11, 2014 was 36,205,162.

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CALAMP CORP.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(IN THOUSANDS, EXCEPT PAR VALUE)

		November 30,				February 28,
Assets		2014				2014
Current assets:
Cash and cash equivalents		$	23,964			$	19,233
Short-term marketable securities			12,963				8,500
Accounts receivable, less allowance for doubtful accounts of
$577 and $761 at November 30, 2014 and February 28, 2014, respectively			45,367				36,904
Inventories			19,575				14,968
Deferred income tax assets			7,465				7,619
Prepaid expenses and other current assets			3,646				5,017
Total current assets			112,980				92,241
Long-term marketable securities			3,044				518
Property, equipment and improvements, net of
accumulated depreciation and amortization			7,433				4,771
Deferred income tax assets, less current portion			29,515				35,131
Goodwill			15,479				15,422
Other intangible assets, net			24,224				29,131
Other assets			5,532				2,051
		$	198,207			$	179,265
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt		$	577			$	1,156
Accounts payable			29,699				20,508
Accrued payroll and employee benefits			5,082				6,594
Deferred revenue			8,450				8,251
Other current liabilities			6,302				5,609
Total current liabilities			50,110				42,118
Long-term debt			197				702
Other non-current liabilities			4,341				3,298
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 3,000 shares authorized;
no shares issued or outstanding			-				-
Common stock, $.01 par value; 80,000 shares authorized;
36,179 and 35,859 shares issued and outstanding
at November 30, 2014 and February 28, 2014, respectively			362				359
Additional paid-in capital			206,571				206,154
Accumulated deficit			(63,309	)			(73,301	)
Accumulated other comprehensive loss			(65	)			(65	)
Total stockholders' equity			143,559				133,147
		$	198,207			$	179,265

See accompanying notes to consolidated financial statements.

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CALAMP CORP.
CONSOLIDATED INCOME STATEMENTS (Unaudited)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

		Three Months Ended								Nine Months Ended
		November 30,								November 30,
		2014				2013				2014				2013
Revenues :
Products		$	52,837			$	53,307			$	151,295			$	146,221
Application subscriptions and other services			10,388				10,196				30,121				29,835
Total revenues			63,225				63,503				181,416				176,056
Cost of revenues:
Products			36,165				37,845				104,754				104,456
Application subscriptions and other services			4,956				4,663				13,843				12,285
Total cost of revenues			41,121				42,508				118,597				116,741
Gross profit			22,104				20,995				62,819				59,315
Operating expenses:
Research and development			4,852				5,267				14,986				15,721
Selling			5,162				4,920				15,260				14,789
General and administrative			4,000				3,291				11,529				10,521
Intangible asset amortization			1,635				1,485				4,952				4,618
Total operating expenses			15,649				14,963				46,727				45,649
Operating income			6,455				6,032				16,092				13,666
Non-operating expense:
Interest expense, net			(12	)			(67	)			(108	)			(276	)
Other expense			(22	)			(10	)			(17	)			(51	)
Total non-operating expense			(34	)			(77	)			(125	)			(327	)
Income before income taxes			6,421				5,955				15,967				13,339
Income tax provision			(2,400	)			(1,748	)			(5,975	)			(4,603	)
Net income		$	4,021			$	4,207			$	9,992			$	8,736
Earnings per share:
Basic		$	0.11			$	0.12			$	0.28			$	0.25
Diluted		$	0.11			$	0.12			$	0.27			$	0.24
Shares used in computing earnings per share:
Basic			35,901				35,171				35,735				34,848
Diluted			36,526				36,206				36,508				35,901

See accompanying notes to consolidated financial statements.

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CALAMP CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(IN THOUSANDS)

		Nine Months Ended
		November 30,
		2014				2013
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	9,992			$	8,736
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization			6,629				5,967
Stock-based compensation expense			2,924				2,129
Amortization of debt issue costs and discount			380				194
Deferred tax assets, net			5,770				4,469
Other			14				-
Changes in operating assets and liabilities:
Accounts receivable			(8,508	)			(6,317	)
Inventories			(4,619	)			1,054
Prepaid expenses and other assets			(2,124	)			657
Accounts payable			9,191				4,533
Accrued liabilities			1,073				(2,306	)
Deferred revenue			199				289
NET CASH PROVIDED BY OPERATING ACTIVITIES			20,921				19,405
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable securities			(15,215	)			-
Proceeds from maturities of marketable securities			8,226				-
Property and equipment purchases			(4,398	)			(1,375	)
Acquisition net of cash acquired			-				(46,837	)
NET CASH USED IN INVESTING ACTIVITIES			(11,387	)			(48,212	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from bank term loan, net of repayments			-				(1,800	)
Payment of acquisition-related note and contingent consideration			(2,299	)			(710	)
Taxes paid related to net share settlement of vested equity awards			(3,045	)			(3,027	)
Proceeds from exercise of stock options			541				2,351
NET CASH USED IN FINANCING ACTIVITIES			(4,803	)			(3,186	)
Net change in cash and cash equivalents			4,731				(31,993	)
Cash and cash equivalents at beginning of period			19,233				63,101
Cash and cash equivalents at end of period		$	23,964			$	31,108

See accompanying notes to consolidated financial statements.

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CALAMP CORP.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED NOVEMBER 30, 2014 AND 2013

NOTE 1 - DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

CalAmp Corp. ("CalAmp" or the "Company") is a leading provider of wireless communications solutions for a broad array of applications to customers globally. The Company’s business activities are organized into its Wireless DataCom and Satellite business segments.

The Company uses a 52-53 week fiscal year ending on the Saturday closest to February 28, which for fiscal 2014, a 52-week year, fell on March 1, 2014. The actual interim periods presented herein ended on November 29, 2014 and November 30, 2013, both consisting of 13 weeks. In the accompanying unaudited consolidated financial statements, the 2014 fiscal year end is shown as February 28 and the interim period end for both years is shown as November 30 for clarity of presentation.

Certain notes and other information are condensed or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with the Company's 2014 Annual Report on Form 10-K as filed with the Securities and Exchange Commission on April 24, 2014.

In the opinion of the Company's management, the accompanying unaudited consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary to present fairly the Company's financial position at November 30, 2014 and its results of operations for the three and nine months ended November 30, 2014 and 2013. The results of operations for such periods are not necessarily indicative of results to be expected for the full fiscal year.

All significant intercompany transactions and accounts have been eliminated in consolidation.

Revenue Recognition

The Company recognizes revenue from product sales when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable and collection of the sales price is reasonably assured. Generally, these criteria are met at the time product is shipped, except for shipments made on the basis of "FOB Destination" terms, in which case title transfers to the customer and the revenue is recorded by the Company when the shipment reaches the customer. Customers generally do not have rights of return except for defective products returned during the warranty period. In the limited number of instances where customers have a right of return period, revenue is not recognized until the expiration of such period. The Company records estimated commitments related to customer incentive programs as reductions of revenues.

The Company provides Software as a Service (SaaS) subscriptions for its fleet management and vehicle finance applications in which customers are provided with the ability to wirelessly communicate with monitoring devices installed in vehicles and other mobile assets via software applications hosted by the Company. The Company defers the recognition of revenue for the monitoring device products that are sold with application subscriptions because the application services are essential to the functionality of the products, and accordingly, the associated product costs are recorded as deferred costs in the balance sheet. The deferred product revenue and deferred product cost amounts are amortized to application subscriptions revenue and cost of revenue on a straight-line basis over the minimum contractual service periods of one year to three years. Revenues from renewals of data communication services after the initial one year term are recognized as application subscriptions revenue when the services are provided. When customers prepay application subscription renewals, such amounts are recorded as deferred revenues and are recognized over the renewal term.

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Fair Value Measurements

The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly manner in an arms-length transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has elected the fair value option for its investment in marketable securities on contract-by-contract basis at the time each contract is initially recognized in the financial statements.

NOTE 2 - FINANCIAL INSTRUMENTS

Cash, Cash Equivalents and Marketable Securities

The following table summarizes the Company’s cash and marketable securities as of November 30, 2014 using the hierarchy described in Note 1 under the heading “Fair Value Measurements” (in thousands):

												Balance Sheet Classification
												of Fair Value
					Unrealized							Cash and			Short-Term			Long-Term
		Adjusted			Gains				Fair			Cash			Marketable			Marketable
		Cost			(Losses)				Value			Equivalents			Securities			Securities
Cash		$	17,026		$	-			$	17,026		$	17,026		$	-		$	-
Level 1:
U.S. Treasury securities			1,000			-				1,000			-			1,000			-
Level 2:
Repurchase agreements			8,938			-				8,938			6,938			2,000			-
Commercial paper			13,010			(3	)			13,007			-			9,963			3,044
Total		$	39,974		$	(3	)		$	39,971		$	23,964		$	12,963		$	3,044

NOTE 3 - INVENTORIES

Inventories consist of the following (in thousands):

		November 30,			February 28,
		2014			2014
Raw materials		$	17,071		$	12,410
Work in process			657			380
Finished goods			1,847			2,178
		$	19,575		$	14,968

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NOTE 4 - GOODWILL AND OTHER INTANGIBLE ASSETS

Changes in goodwill are as follows (in thousands):

		Nine Months Ended
		November 30,
		2014			2013
Balance at beginning of period		$	15,422		$	1,112
Wireless Matrix acquisition			-			17,192
Purchase price allocation adjustments			57			-
Balance at end of period		$	15,479		$	18,304

Other intangible assets are comprised as follows (in thousands):

				November 30, 2014									February 28, 2014
				Gross									Gross
		Amortization		Carrying			Accumulated						Carrying			Accumulated
		Period		Amount			Amortization			Net			Amount			Amortization			Net
Supply contract		5 years		$	2,220		$	1,136		$	1,084		$	2,220		$	803		$	1,417
Developed/core technology		2-7 years			16,151			6,577			9,574			16,151			4,886			11,265
Tradename		7 years			2,130			1,141			989			2,130			913			1,217
Customer lists		5-7 years			19,438			7,060			12,378			19,438			4,394			15,044
Covenants not to compete		5 years			262			179			83			262			153			109
Patents		5 years			165			49			116			121			42			79
				$	40,366		$	16,142		$	24,224		$	40,322		$	11,191		$	29,131

All intangible asset amortization expense was attributable to the Wireless DataCom business. Estimated future amortization expense for the fiscal years ending February 28 is as follows (in thousands):

NOTE 5 - FINANCING ARRANGEMENTS

Bank Credit Facility

The Company has a credit facility with Square 1 Bank that provides for borrowings up to $15 million or 85% of eligible accounts receivable, whichever is less. The credit facility expires on March 1, 2017. Borrowings under this line of credit bear interest at the bank’s prime rate. There were no borrowings outstanding under this credit facility at November 30, 2014 or February 28, 2014.

The Square 1 Bank credit facility contains financial covenants that require the Company to maintain a minimum level of earnings before interest, income taxes, depreciation, amortization and other noncash charges ("EBITDA") and a minimum debt coverage ratio, both measured monthly on a rolling 12-month basis. At November 30, 2014, the Company was in compliance with its debt covenants under the credit facility.

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Long-Term Debt

Long-term debt is comprised of the following (in thousands):

The Navman Wireless (“Navman”) note is payable in the form of a 15% rebate on certain products sold by CalAmp to Navman under a five-year $25 million supply agreement (the “Supply Agreement”) that was entered into in May 2012 in conjunction with CalAmp’s purchase of a product line from Navman. The unpaid balance of the Navman note would become immediately due and payable upon any termination of the Supply Agreement by the Company before the end of its five-year term (other than as a result of an uncured breach of the Supply Agreement by Navman), except that in the case of such acceleration the note balance would be subordinated to the Company’s bank debt pursuant to the provisions of a debt subordination agreement. In the absence of an acceleration event, the Navman note is payable solely in the form of a rebate on products sold by CalAmp to Navman under the Supply Agreement. After all rebates have been applied to pay down the note balance, and assuming that an acceleration event has not occurred, any unpaid balance remaining on the Navman note would be forgiven at the later of May 7, 2017 or the final date to which the Supply Agreement is extended pursuant to a force majeure event. During the nine months ended November 30, 2014, the Company made principal payments of $1,272,000 and amortized $188,000 of the discount on the Navman note.

Other Non-Current Liabilities

Other non-current liabilities consist of the following (in thousands):

		November 30,			February 28,
		2014			2014
Deferred revenue		$	1,744		$	1,977
Acquisition-related contingent consideration			259			1,092
Deferred compensation			1,984			131
Deferred rent			354			98
		$	4,341		$	3,298

The acquisition-related contingent consideration at November 30, 2014 is comprised of the $259,000 non-current portion of the total estimated remaining earn-out of $1,581,000 payable to the sellers in conjunction with the December 2013 acquisition of Radio Satellite Integrators, Inc.

In August 2013, the Company adopted a non-qualified deferred compensation plan in which the executive officers and certain other management employees are eligible to participate whereby such officers and employees may defer a portion of their annual base and/or variable compensation until retirement or a date specified by the employee in accordance with the plan. Deferred compensation plan assets and liabilities as of November 30, 2014 were approximately $1,963,000 and $1,984,000, respectively, and are included in other assets and other non-current liabilities in the accompanying consolidated balance sheet at that date. Effective July 1, 2014, the plan was amended to include restricted stock units as a deferrable form of compensation and to allow non-employee directors to participate in the plan.

NOTE 6 - 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 for income tax purposes. The Company evaluates the realizability of its deferred income tax assets and a valuation allowance is provided, as necessary. In assessing this valuation allowance, the Company reviews historical and future expected operating results and other factors, including its recent cumulative earnings experience, expectations of future taxable income by taxing jurisdiction and the carryforward periods available for tax reporting purposes, to determine whether it is more likely than not that deferred tax assets are realizable.

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The Company files income tax returns in the U.S. federal jurisdiction, various U.S. states, Canada, the United Kingdom and New Zealand. Income tax returns filed for fiscal years 2009 and earlier are not subject to examination by U.S. federal and state tax authorities. Certain income tax returns for fiscal years 2010 through 2014 remain open to examination by U.S. federal and state tax authorities. Income tax returns for fiscal years 2010 through 2014 remain open to examination by tax authorities in Canada. In addition, the income tax return for fiscal year 2013 remains open to examination by tax authorities in New Zealand. The Company believes that it has made adequate provision for all income tax uncertainties pertaining to these open tax years.

The effective income tax rate was 37.4% and 34.5% in the nine months ended November 30, 2014 and 2013, respectively.

NOTE 7 - EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period, plus the dilutive effect of outstanding stock options and restricted stock-based awards using the treasury stock method. The following table sets forth the composition of weighted average shares used in the computation of basic and diluted earnings per share (in thousands):

Shares underlying stock options of 146,000 and 65,000 at November 30, 2014 and November 30, 2013, respectively, were excluded from the calculations of diluted earnings per share for the three and nine month periods then ended because based on the exercise prices of these derivative securities their inclusion would have been anti-dilutive under the treasury stock method.

NOTE 8 - STOCK-BASED COMPENSATION

Stock-based compensation expense is included in the following captions of the unaudited consolidated income statements (in thousands):

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Changes in the Company's outstanding stock options during the nine months ended November 30, 2014 were as follows (options in thousands):

Changes in the Company's outstanding restricted stock shares and restricted stock units (“RSUs”) during the nine months ended November 30, 2014 were as follows (shares and RSUs in thousands):

During the nine months ended November 30, 2014, the Company retained 172,974 shares of the vested restricted stock and RSUs to satisfy the minimum required statutory amount of employee withholding taxes.

As of November 30, 2014, there was $10.7 million of total unrecognized stock-based compensation cost related to nonvested stock options, restricted stock and RSUs that is expected to be recognized as an expense over a weighted-average remaining vesting period of 3.2 years.

NOTE 9 - CONCENTRATION OF RISK

Because the Company sells into markets dominated by a few large service providers, a significant percentage of consolidated revenues and consolidated accounts receivable relate to a small number of customers. One customer of the Company's Satellite business segment accounted for 14% and 22% of consolidated revenues for the quarters ended November 30, 2014 and 2013, respectively, and accounted for 16% and 22% of consolidated revenues for the respective nine-month periods then ended. This customer accounted for 9% and 15% of consolidated net accounts receivable at November 30, 2014 and February 28, 2014, respectively.

A substantial portion of the Company’s inventory is purchased from one supplier which functions as an independent foreign procurement agent and contract manufacturer. This supplier accounted for 59% and 65% of Company's total inventory purchases in the nine months ended November 30, 2014 and 2013, respectively. As of November 30, 2014, this supplier accounted for 57% of the Company's total accounts payable.

Some of the Company's components, assemblies and electronic manufacturing services are purchased from sole source suppliers.

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NOTE 10 - PRODUCT WARRANTIES

The Company generally warrants its products against defects over periods ranging from 3 to 24 months. An accrual for estimated future costs relating to products returned under warranty is recorded as an expense when products are shipped. At the end of each quarter, the Company adjusts its liability for warranty claims based on its actual warranty claims experience as a percentage of revenues for the preceding 12 to 24 months and also considers the impact of the known operational issues that may have a greater impact than historical trends. Accrued warranty costs are included in other current liabilities in the consolidated balance sheets. Activity in the accrued warranty costs liability for the nine months ended November 30, 2014 and 2013 is as follows (in thousands):

NOTE 11 - OTHER FINANCIAL INFORMATION

"Net cash provided by operating activities" in the unaudited consolidated statements of cash flows includes cash payments for interest and income taxes as follows (in thousands):

NOTE 12 - SEGMENT INFORMATION

Segment information for the three and nine months ended November 30, 2014 and 2013 is as follows (dollars in thousands):

		Three Months Ended November 30, 2014																Three Months Ended November 30, 2013
		Operating Segments																Operating Segments
		Wireless								Corporate								Wireless								Corporate
		DataCom				Satellite				Expenses				Total				DataCom				Satellite				Expenses				Total
Revenues		$	54,580			$	8,645							$	63,225			$	49,747			$	13,756							$	63,503
Gross profit		$	20,078			$	2,026							$	22,104			$	18,159			$	2,836							$	20,995
Gross margin			36.8	%			23.4	%							35.0	%			36.5	%			20.6	%							33.1	%
Operating income		$	6,579			$	914			$	(1,038	)		$	6,455			$	5,026			$	1,785			$	(779	)		$	6,032

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		Nine Months Ended November 30, 2014																Nine Months Ended November 30, 2013
		Operating Segments																Operating Segments
		Wireless								Corporate								Wireless								Corporate
		DataCom				Satellite				Expenses				Total				DataCom				Satellite				Expenses				Total
Revenues		$	152,631			$	28,785							$	181,416			$	137,808			$	38,248							$	176,056
Gross profit		$	55,440			$	7,379							$	62,819			$	51,674			$	7,641							$	59,315
Gross margin			36.3	%			25.6	%							34.6	%			37.5	%			20.0	%							33.7	%
Operating income		$	14,904			$	4,070			$	(2,882	)		$	16,092			$	11,706			$	4,561			$	(2,601	)		$	13,666

The Company considers operating income to be the primary measure of operating performance of its business segments. The amount shown for each period in the "Corporate Expenses" column above consists of expenses that are not allocated to the business segments. These non-allocated corporate expenses include salaries and benefits of certain corporate staff and expenses such as audit fees, investor relations, stock listing fees, director and officer liability insurance, and director fees and expenses. Corporate expenses include stock-based compensation expense of $249,000 and $140,000 in the three-month periods ended November 30, 2014 and 2013, respectively, and $587,000 and $425,000, respectively, in the nine-month periods then ended.

NOTE 13 - COMMITMENTS AND CONTINGENCIES

Legal Proceedings

In December 2013, a patent infringement lawsuit was filed against the Company. The lawsuit contends that certain of the Company’s vehicle tracking products infringe on the patents held by the plaintiff and seeks injunctive and monetary relief. The Company believes that it has various offensive claims against the plaintiff, and intends to vigorously defend against this action. While the outcome of this matter is currently not determinable, management does not expect that the ultimate cost to resolve this matter will have a material adverse effect on the Company’s consolidated financial position or results of operations. The Company’s assessment of materiality may change in the future based upon the availability of discovery and further developments in any matters. No loss accrual has been made in the accompanying consolidated financial statements for this matter.

In addition to the foregoing matter, from time to time as a normal consequence of doing business, various claims and litigation may be asserted or commenced against the Company. In particular, the Company in the ordinary course of business may receive claims concerning contract performance, or claims that its products or services infringe the intellectual property of third parties. While the outcome of any such claims or litigation cannot be predicted with certainty, management does not believe that the outcome of any of such matters existing at the present time would have a material adverse effect on the Company's consolidated financial position or results of operations.

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ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The Company's discussion and analysis of its financial condition and results of operations are based upon the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues, costs and expenses during the reporting periods. Actual results could differ materially from these estimates. The critical accounting policies listed below involve the Company’s more significant accounting judgments and estimates that are used in the preparation of the consolidated financial statements. These policies are described in greater detail in Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) under Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended February 28, 2014, as filed with the Securities and Exchange Commission on April 24, 2014, and include the following areas:

	●		Allowance for doubtful accounts;
	●		Inventory write-downs;
	●		Product warranties;
	●		Deferred income tax assets and uncertain tax positions;
	●		Impairment assessments of goodwill, intangible assets and other long-lived assets;
	●		Stock-based compensation expense; and
	●		Revenue recognition.

RESULTS OF OPERATIONS

OUR COMPANY

We are a leading provider of wireless communications solutions for a broad array of applications to customers globally. Our business activities are organized into our Wireless DataCom and Satellite reporting segments.

WIRELESS DATACOM

Our Wireless DataCom segment offers solutions for Mobile Resource Management (MRM) applications, the broader Machine-to-Machine (M2M) communications space and other emerging markets that require connectivity anytime and anywhere. Our MRM and M2M solutions enable customers to optimize their operations by collecting, monitoring and efficiently reporting business-critical data and desired intelligence from high-value remote and mobile assets. Our extensive portfolio of communications devices, scalable cloud service platforms, and targeted software applications streamline otherwise complex M2M or MRM deployments for our customers. We are focused on delivering products, software services and solutions globally for our energy, government, transportation and automotive vertical markets. In addition, we anticipate future opportunities for adoption of our MRM products and M2M solutions in Heavy Equipment and various aftermarket telematics applications including automotive usage-based insurance (UBI), as well as other emerging applications and markets.

SATELLITE

Our Satellite segment develops, manufactures and sells direct-broadcast satellite (DBS) outdoor customer premise equipment and whole home video networking devices for digital and high definition satellite television services. Our satellite products are sold primarily to EchoStar, an affiliate of Dish Network, for incorporation into complete subscription satellite television systems.

Operating Results by Business Segment

The Company's revenue, gross profit and operating income by business segment are as follows:

		REVENUE BY SEGMENT
		Three Months Ended November 30,										Nine Months Ended November 30,
		2014					2013					2014					2013
					% of					% of					% of					% of
		$000s			Total		$000s			Total		$000s			Total		$000s			Total
Segment
Wireless DataCom		$	54,580		86.3%		$	49,747		78.3%		$	152,631		84.1%		$	137,808		78.3%
Satellite			8,645		13.7%			13,756		21.7%			28,785		15.9%			38,248		21.7%
Total		$	63,225		100.0%		$	63,503		100.0%		$	181,416		100.0%		$	176,056		100.0%
		GROSS PROFIT BY SEGMENT
		Three Months Ended November 30,										Nine Months Ended November 30,
		2014					2013					2014					2013
					% of					% of					% of					% of
		$000s			Total		$000s			Total		$000s			Total		$000s			Total
Segment
Wireless DataCom		$	20,078		90.8%		$	18,159		86.5%		$	55,440		88.3%		$	51,674		87.1%
Satellite			2,026		9.2%			2,836		13.5%			7,379		11.7%			7,641		12.9%
Total		$	22,104		100.0%		$	20,995		100.0%		$	62,819		100.0%		$	59,315		100.0%

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		OPERATING INCOME BY SEGMENT
		Three Months Ended November 30,														Nine Months Ended November 30,
		2014							2013							2014							2013
						% of							% of							% of							% of
						Total							Total							Total							Total
		$000s				Revenue			$000s				Revenue			$000s				Revenue			$000s				Revenue
Segment
Wireless DataCom		$	6,579			10.4%			$	5,026			7.9%			$	14,904			8.2%			$	11,706			6.6%
Satellite			914			1.4%				1,785			2.8%				4,070			2.2%				4,561			2.6%
Corporate expenses			(1,038	)		(1.6%	)			(779	)		(1.2%	)			(2,882	)		(1.6%	)			(2,601	)		(1.5%	)
Total		$	6,455			10.2%			$	6,032			9.5%			$	16,092			8.8%			$	13,666			7.7%

Revenue

Wireless DataCom revenue increased by $4.8 million, or 10%, to $54.6 million in the third quarter of fiscal 2015 compared to the fiscal 2014 third quarter due primarily to the revenue generated from a major OEM manufacturer in the heavy equipment industry. For the nine months ended November 30, 2014, Wireless DataCom revenue increased by $14.8 million, or 11%, to $152.6 million compared to the same period of the prior year due primarily to the aforementioned factors for the three-month periods, as well as increased sales of MRM products into the UBI, fleet management and asset tracking markets and to increased demand from a key customer in the solar energy industry.

Satellite revenue decreased by $5.1 million, or 37%, to $8.6 million in the three months ended November 30, 2014 from $13.7 million for the same period in the previous fiscal year. For the nine months ended November 30, 2014, Satellite revenue decreased by $9.5 million, or 25%, to $28.8 million from $38.3 million for the same period of the prior year. These declines are due primarily to fluctuations in product demand and product transitions on the part of the Satellite segment’s principal customer.

Gross Profit and Gross Margins

Wireless DataCom gross profit increased to $20.1 million in the fiscal 2015 third quarter compared to $18.2 million in the third quarter of last year, and gross margin increased to 36.8% in the third quarter of fiscal 2015 from 36.5% in the third quarter of fiscal 2014 due to product mix changes. Wireless DataCom gross profit increased to $55.4 million in the nine months ended November 30, 2014, compared to $51.7 million for the same period of the prior year primarily due to increased revenues. For the nine months ended November 30, 2014, Wireless DataCom gross margin decreased to 36.3% from 37.5% for the same period of the prior year due to changes in product mix.

Satellite gross profit decreased $0.8 million to $2.0 million in the fiscal 2015 third quarter compared to the third quarter of last year. Satellite's gross margin increased to 23.4% in the fiscal 2015 third quarter from 20.6% in the third quarter of last year primarily due to increased sales of higher margin in-home video distribution products.

The Satellite segment had gross profit of $7.4 million for the nine months ended November 30, 2014, compared to gross profit of $7.6 million for the same period last year. Satellite gross margin was 25.6% for the nine months ended November 30, 2014, compared to 20.0% for the same period last year. These increases are attributable to the same factor cited above for the three-month periods.

See also Note 12 to the accompanying unaudited consolidated financial statements for additional operating data by business segment.

Operating Expenses

Consolidated research and development (“R&D”) expense decreased by $0.4 million to $4.9 million in the third quarter of fiscal 2015 from $5.3 million in the third quarter of last year. For the nine-month year-to-date periods, R&D expense decreased by $0.7 million from $15.7 million last year to $15.0 million. These decreases are due primarily to the absorption of engineering time on customer product development and internal-use software projects.

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Consolidated selling expenses increased by $0.3 million to $5.2 million in the third quarter of fiscal 2015 from $4.9 million in the third quarter of last year. For the nine-month year-to-date periods, selling expenses increased by $0.5 million to $15.3 million this year from $14.8 million last year. These increases are due primarily to higher marketing-related expenses.

Consolidated general and administrative expenses ("G&A") increased by $0.7 million to $4.0 million in the third quarter of this year from $3.3 million last year. For the nine-month periods, consolidated G&A increased by $1.0 million to $11.5 million for fiscal 2015 from $10.5 million last year. These increases are due primarily to higher legal and stock compensation expenses.

Amortization of intangibles increased from $1.5 million in the third quarter of last year to $1.6 million in the third quarter of this year. For the nine-month periods, amortization of intangibles increased to $5.0 million this year from $4.6 million last year. These increases are due to amortization of intangible assets that arose in conjunction with the acquisition of Radio Satellite Integrators, Inc. in December 2013.

Non-operating Expense, Net

Non-operating expense, net decreased by $43,000 to $34,000 in the third quarter of this year compared to $77,000 in the third quarter of last year due primarily to higher investment income this year compared to last year and lower interest expense this year compared to last year because of the payoff of the Company’s bank term loan during the third quarter of last year.

Non-operating expense, net was $125,000 in the nine months ended November 30, 2014 compared to $327,000 in the nine months ended November 30, 2013 due primarily to the same factors cited above for the three month periods.

Income Tax Provision

The effective income tax rate was 37.4% and 34.5% in the nine months ended November 30, 2014 and 2013, respectively. The increase in effective tax rate was primarily due to the fact that last year was benefited by federal R&D credits. No federal R&D tax credits have been recognized in the current year because as of November 30, 2014 this tax credit program had not been extended beyond calendar 2013.

LIQUIDITY AND CAPITAL RESOURCES

The Company has a credit facility with Square 1 Bank that provides for borrowings up to $15 million or 85% of eligible accounts receivable, whichever is less. The credit facility expires on March 1, 2017. Borrowings under this line of credit bear interest at the bank’s prime rate. There were no borrowings outstanding under this credit facility at November 30, 2014 or February 28, 2014.

The Company's primary sources of liquidity are its cash, cash equivalents, marketable securities and the revolving line of credit with Square 1 Bank. During the nine months ended November 30, 2014, cash and cash equivalents increased by $4.7 million. During this period, cash of $20.9 million was provided by operations, and cash of $11.4 million was used in investing activities, consisting of net purchases of marketable securities of $7.0 million and capital expenditures of $4.4 million. In addition, cash of $4.8 million was used in financing activities, consisting of taxes paid related to net share settlement of vested equity awards of $3.0 million, payment of the note and contingent consideration of $1.7 million associated with the fiscal 2013 Navman product line acquisition and payment of contingent consideration of $0.6 million associated with the fiscal 2014 acquisition of Radio Satellite Integrators, Inc., partially offset by proceeds of $0.5 million from exercise of stock options.

FORWARD LOOKING STATEMENTS

Forward looking statements in this Form 10-Q which include, without limitation, statements relating to the Company's plans, strategies, objectives, expectations, intentions, projections and other information regarding future performance, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words "may", "will", "could", "plans", "intends", "seeks", "believes", "anticipates", "expects", "estimates", "judgment", "goal", and variations of these words and similar expressions, are intended to identify forward-looking statements. These forward-looking statements reflect the Company's current views with respect to future events and financial performance and are subject to certain risks and uncertainties, including, without limitation, product demand, competitive pressures and pricing declines in the Company's wireless and satellite markets, the timing of customer approvals of new product designs, intellectual property infringement claims, interruption or failure of our Internet-based systems used to wirelessly configure and communicate with the tracking and monitoring devices that we sell, and other risks and uncertainties that are set forth in Part II, Item 1A herein and in Part I, Item 1A of the Annual Report on Form 10-K for the year ended February 28, 2014 as filed with the Securities and Exchange Commission on April 24, 2014. Such risks and uncertainties could cause actual results to differ materially from historical or anticipated results. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be attained. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Risk

The Company has international operations, giving rise to exposure to market risks from changes in foreign exchange rates. A cumulative foreign currency translation loss of $65,000 related to the Company's Canadian subsidiary is included in accumulated other comprehensive loss in the stockholders' equity section of the consolidated balance sheet at November 30, 2014. The aggregate foreign currency transaction exchange rate losses included in determining income before income taxes were $21,000 and $10,000 in the three months ended November 30, 2014 and 2013, respectively. The aggregate foreign currency transaction exchange rate losses included in determining income before income taxes were $5,000 and $45,000 in the nine months ended November 30, 2014 and 2013, respectively.

Interest Rate Risk

The Company has variable-rate bank debt. A fluctuation of 1% in the interest rate on the $15 million credit facility with Square 1 Bank would have an annual impact of approximately $150,000 on the Company's consolidated statement of operations assuming that the full amount of the facility was borrowed. There were no borrowings outstanding on this facility at November 30, 2014 or during the nine months then ended.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company's principal executive officer and principal financial officer have concluded, based on their evaluation of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, (the "Exchange Act")) as of the end of the period covered by this Report, that the Company's disclosure controls and procedures are effective to ensure that the information required to be disclosed in reports that are filed or submitted under the Exchange Act is accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and that such information is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

Internal Control Over Financial Reporting

There has been no change in the Company's internal control over financial reporting that occurred during the Company's most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1A. RISK FACTORS

The reader is referred to Part I, "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the year ended February 28, 2014, as filed with the Securities and Exchange Commission on April 24, 2014, for a discussion of factors that could materially affect the Company's business, financial condition or future results. The risks described in the Company’s Annual Report on Form 10-K are not the only risks facing the Company at the present time. An additional risk is as follows:

Our current outlook for revenues and earnings over the next several quarters could be adversely impacted by unforeseen delays in the expected increase in product shipments to a key customer in the heavy equipment industry.

Approximately two years ago, we were engaged by a major OEM manufacturer in the heavy equipment industry to develop and produce telematics devices used to transmit information about the heavy equipment, including operating location, equipment performance and diagnostic data. We are currently ramping up shipments to this customer, and consequently we expect our product sales to this customer will increase over the next few quarters. Any unforeseen delays in the expected ramp in product shipments to this customer or an adverse change in our relationship with this customer could have a significant impact on our current outlook for our results of operations over the next several quarters.

ITEM 6. EXHIBITS

	Exhibit 31.1 –	Chief Executive Officer Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	Exhibit 31.2 –	Chief Financial Officer Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	Exhibit 32 –	Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
	101.INS	XBRL Instance Document
	101.SCH	XBRL Taxonomy Extension Schema Document
	101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
	101.LAB	XBRL Taxonomy Extension Label Linkbase Document
	101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
	101.DEF	XBRL Taxonomy Extension Definition Linkbase Document

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SIGNATURE

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.

			CALAMP CORP.
December 23, 2014			/s/ Richard Vitelle
Date			Richard Vitelle
			Executive Vice President & CFO
			(Principal Financial Officer and
			Chief Accounting Officer)

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