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FINANCIAL STATEMENT COMPONENTS
 9 Months Ended
Sep. 30, 2025
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
FINANCIAL STATEMENT COMPONENTS

8. FINANCIAL STATEMENT COMPONENTS

 

The following financial statement components have significant balances as of September 30, 2025.

 

Inventory

 

Inventory consists of the following as of September 30, 2025 and December 31, 2024:

 

   September 30,   December 31, 
(in thousands)  2025   2024 
Raw materials  $3,096   $1,616 
Work in process   -    - 
Finished goods   5,035    678 
Total inventory  $8,131   $2,294 

 

Inventory is computed using the first-in, first-out (FIFO) method and is stated at the lower of cost and net realizable value. Management periodically assesses the need to account for obsolescence of inventory and adjusts the carrying value of inventory to its net realizable value when required.

 

 

Property and Equipment

 

Property and equipment consists of the following as of September 30, 2025 and December 31, 2024:

 

   September 30,   December 31, 
(in thousands)  2025   2024 
Production equipment  $6,140   $6,140 
Leasehold improvements   4,080    3,957 
Computer hardware and software/lab equipment   12,347    12,211 
Office furniture and equipment   5,548    4,973 
Property and equipment, gross   28,115    27,281 
Less: Accumulated depreciation   (21,541)   (20,220)
Property and equipment, net  $6,574   $7,061 

 

Depreciation expense was $0.4 million and $0.6 million for the three months ended September 30, 2025 and 2024, respectively, and $1.1 million and $1.7 million for the nine months ended September 30, 2025 and 2024, respectively.

 

Intangible Assets

 

The components of intangible assets were as follows as of September 30, 2025 and December 31, 2024:

 

As of September 30, 2025  Gross       Accumulated   Net  

Weighted

Average Remaining

 
   Carrying   Accumulated   Impairment   Carrying   Period 
(in thousands)  Amount   Amortization   Expense   Amount   (Years) 
Acquired technology  $20,172   $5,710   $4,181   $10,281    12 
   $20,172   $5,710   $4,181   $10,281      

 

As of December 31, 2024   Gross       Accumulated   Net   Weighted Average Remaining 
    Carrying   Accumulated   Impairment   Carrying   Period 
(in thousands)   Amount   Amortization   Expense   Amount   (Years) 
Acquired technology  $20,172   $5,019   $4,181   $10,972    13 
   $20,172   $5,019   $4,181   $10,972      

 

Amortization expense was $0.2 million and $0.5 million for the three months ended September 30, 2025 and 2024, and $0.7 million and $1.6 million for the nine months ended September 30, 2025 and 2024, respectively.

 

During the quarter ended June 30, 2024, management identified various factors related to the 2024 restructuring events (see Note 14. Restructuring Charges) that collectively indicated that it is more-likely-than-not that the fair value of the Company’s Reference software intangible asset was less than its carrying amount as of June 30, 2024. As of June 30, 2024, prior to impairment, the fair value was $4.5 million. As a result, the Company performed an impairment assessment for intangibles in accordance with ASC 360, Property, Plant and Equipment. The June 30, 2024 impairment test indicated a decline in the carrying amount of the Reference software intangible asset and a reduction in the asset’s useful life, resulting in a non-cash impairment charge of $3.0 million, which is included in impairment loss on intangible assets on the condensed consolidated statement of operations. The fair value of the Reference software subsequent to impairment was $1.4 million and is included within intangible assets, net on the condensed consolidated balance sheets. There was no impairment of intangible assets during the nine months ended September 30, 2025.

 

The following table outlines estimated future amortization expense related to intangible assets held as of September 30, 2025 by line item on the condensed consolidated statement of operations (in thousands):

 

        Research and     
    Cost of   Development     
Years Ended December 31,   Revenue   Expense   Total 
2025 (remainder of the year)   $217   $11   $228 
2026    869    30    899 
2027    829    2    831 
2028    825    -    825 
2029    825    -    825 
Thereafter    6,673    -    6,673 
Total   $10,238   $43   $10,281