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Investments | 9 Months Ended
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Sep. 30, 2025
Investments [Abstract] |
Investments | Investments Available for sale securities The Company follows the provisions of Accounting Standards Codification ("ASC") 820, Fair Value Measurements and Disclosures, for its financial assets and liabilities, and for its non-financial assets and liabilities subject to fair value measurements. ASC 820 provides a framework for measuring the fair value of assets and liabilities. This framework is intended to provide increased consistency in how fair value determinations are made under various existing accounting standards that permit, or in some cases, require estimates of fair-market value. This standard also expanded financial statement disclosure requirements with respect to a company’s use of fair-value measurements, including the effect of such measurements on earnings. The cost of securities sold is based on the specific identification method. The Company determines the fair value of its government securities, asset-backed securities, municipal bonds, and corporate bonds by utilizing monthly valuation statements that are provided by its broker. The broker determines the investment valuation by utilizing the bid price in the market and also refers to third party sources to validate valuations, and as such are classified as Level 2 assets. The Company's certificates of deposit are classified as available for sale and are considered as Level 1 assets. These investments are carried at cost, which approximates fair value. On December 31, 2024, the Company held a total of 6,463,808 shares of VOXX International Corporation ("VOXX") Class A Common Stock. The VOXX shares held by the Company as of December 31, 2024 were publicly traded, had a readily determinable fair market value, and were considered Level 1 assets. The Company accounted for the VOXX investment in accordance with ASC 323 – Investments – Equity Method and Joint Venture, with the election to use the Fair Value Option under ASC 825 - Fair Value. As a result of this election, changes in fair value of the shares were recorded in Investment income, net, in the Unaudited Condensed Consolidated Statements of Income prior to April 1, 2025. The Company recorded a gain of $0.8 million during the nine months ended September 30, 2025 within Investment income, net, in the accompanying Unaudited Condensed Consolidated Statements of Income related to its VOXX investment. During the three and nine months ended September 30, 2024, the Company recorded a gain of $14.9 million and a loss of $9.0 million, respectively, related to this investment. On April 1, 2025, the Company completed its previously announced merger of VOXX pursuant to that certain Agreement and Plan of Merger dated as of December 17, 2024 (the "Merger Agreement"), acquiring all of the issued and outstanding shares of VOXX common stock not already owned by the Company for a purchase price of $7.50 per share. The Company's investment in VOXX has been included in the purchase price of the entity pursuant to step-acquisition accounting under ASC 805, Business Combinations (see Note 16). Equity Method Investment - ASA The Company has a 50% non-controlling ownership interest in ASA Electronics, LLC and Subsidiary ("ASA"), that was obtained in conjunction with the acquisition of VOXX on April 1, 2025 (see Note 16) and is accounted for in accordance with ASC 323, Investments – Equity Method and Joint Venture. ASA acts as a distributor of mobile electronics, specifically designed for niche markets, including: RV's; buses; and commercial, heavy duty, agricultural, construction, powersport, and marine vehicles. ASC 810, Consolidation, requires the Company to evaluate non-consolidated entities periodically, and as circumstances change, to determine if an implied controlling interest exists. In conjunction with the acquisition of VOXX on April 1, 2025, the Company evaluated this equity method investment and concluded that ASA is not a variable interest entity. The balance of the Company's investment in ASA as of September 30, 2025, was $19.1 million and is included in Long-term investments on the accompanying Condensed Consolidated Balance Sheet. Technology Investments The Company also periodically makes strategic investments in the non-marketable debt or equity securities of other non-consolidated third parties ("Technology Investments"). Such Technology Investments totaled approximately $144.1 million as of September 30, 2025, of which $142.4 million and $1.7 million are recorded in long-term investments and short-term investments, respectively, on the Unaudited Condensed Consolidated Balance Sheet. Such Technology Investments totaled approximately $155.9 million as of December 31, 2024, of which $149.9 million and $6.0 million are recorded in long-term investments and short-term investments, respectively, on the accompanying Condensed Consolidated Balance Sheets. Depending on the form of investment, and the degree of influence the Company has over the investee, the Company primarily accounts for the Technology Investments in accordance with ASC 321, Investments - Equity Securities or ASC 323, Investments – Equity Method and Joint Venture. The Company accounts for equity securities in non-controlled affiliates through which the Company exercises significant influence but does not have control over the investee under the equity method, with the Company’s share of the earnings or losses of non-controlled affiliates recognized within Other (loss) income, net, in the Company's accompanying Unaudited Condensed Consolidated Statements of Income. All other Technology Investments that the Company holds are primarily accounted for under the measurement alternative of ASC 321. Under the measurement alternative, the carrying value is measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. During the three and nine months ended September 30, 2025, the Company recorded other-than-temporary impairment charges of $2.2 million and $8.4 million, respectively, related to two of its technology investments within Investment income, net, on the accompanying Unaudited Condensed Consolidated Statement of Income. During the third quarter of 2025, the Company determined that a triggering event had taken place related to its New Compliance B.V. investment following a funding round conducted by the investee at a per-share price below the Company's carrying value of this investment. As a result, the Company recorded an impairment charge of $2.2 million for the three and nine months ended September 30, 2025 to reduce the carrying value of the investment to an amount consistent with the value implied by the investee's recent financing. During the second quarter of 2025, the Company determined that a triggering event had taken place related to its investment in Green Marbles, LLC, as a result of a deterioration in financial performance of the investee. The Company performed an impairment analysis of this equity method investment and recorded a charge of $6.2 million for the nine months ended September 30, 2025. The fair value of the investment was estimated using a discounted cash flow model. The Company's assumptions in estimating the fair value of Green Marbles, LLC utilized Level 3 inputs, including projected revenue growth, gross margins, EBITDA margins, and weighted average costs of capital. Based on the foregoing, the Company determined that the fair values of these equity method investments were below their carrying values at the respective quarter end dates and does not expect the fair values to recover under current conditions. From time to time, the Company makes loans in the ordinary course of business to certain of its technology investees. Such loans vary in length and are interest bearing, and as such are not deemed to be additional investments in the technology investees as the parties intend for the loans to be repaid. These loans are classified within Prepaid expenses and other and Patents and other assets, net, on the accompanying Unaudited Condensed Consolidated Balance Sheets based on the maturity dates of the loans. During the third quarter of 2025, the Company established an allowance for credit losses for these loans receivable in accordance with ASC 326, Financial Instruments - Credit Losses. This allowance reflects the Company's estimate of expected credit losses over the contractual life of the loans, considering historical loss experience, current conditions, and reasonable and supportable forecasts. The estimate is developed using a combination of quantitative data and qualitative factors, including borrower creditworthiness, loan-specific risk characteristics, macroeconomic trends, and other relevant information, all of which is updated quarterly. The allowance is adjusted through a provision for credit losses in the Company's Unaudited Condensed Consolidated Statements of Income. For the three and nine months ended September 30, 2025, the Company recorded an increase to the credit loss allowance of $4.8 million. The balance of the loans included in Prepaid expenses and other on the accompanying Unaudited Condensed Consolidated Balance Sheet at September 30, 2025 was $15.0 million, net of credit loss allowance. The balance of the loans included in Patents and other assets, net, on the accompanying Unaudited Condensed Consolidated Balance Sheet at September 30, 2025 was $8.1 million, net of credit loss allowance. Assets or liabilities that have recurring fair value measurements are shown below as of September 30, 2025 and December 31, 2024. As of September 30, 2025:
|  |  | Fair Value Measurements at Reporting Date Using
| Total as of |  | Quoted Prices in Active Markets for Identical Assets |  | Significant Other Observable Inputs |  | Significant Unobservable Inputs
Description | September 30, 2025 |  | (Level 1) |  | (Level 2) |  | (Level 3)
Cash & Cash Equivalents | $ | 178,589,422 |  |  | $ | 178,589,422 |  |  | $ | — |  |  | $ | — |
Short-Term Investments: |  |  |  |  |  |  |
Corporate Bonds | 2,261,853 |  |  | — |  |  | 2,261,853 |  |  | — |
Other | 838,907 |  |  | 838,907 |  |  | — |  |  | — |
Long-Term Investments: |  |  |  |  |  |  |
Asset-backed Securities | 30,803,945 |  |  | — |  |  | 30,803,945 |  |  | — |
Corporate Bonds | 38,269,313 |  |  | — |  |  | 38,269,313 |  |  | — |
Municipal Bonds | 16,801,678 |  |  | — |  |  | 16,801,678 |  |  | — |
Total | $ | 267,565,118 |  |  | $ | 179,428,329 |  |  | $ | 88,136,789 |  |  | $ | — |
As of December 31, 2024:
|  |  | Fair Value Measurements at Reporting Date Using
| Total as of |  | Quoted Prices in Active Markets for Identical Assets |  | Significant Other Observable Inputs |  | Significant Unobservable Inputs
Description | December 31, 2024 |  | (Level 1) |  | (Level 2) |  | (Level 3)
Cash & Cash Equivalents | $ | 233,318,766 |  |  | $ | 233,318,766 |  |  | $ | — |  |  | $ | — |
Short-Term Investments: |  |  |  |  |  |  |
Asset-backed Securities | 2,851,933 |  |  | — |  |  | 2,851,933 |  |  | — |
Certificate of Deposit | 751,728 |  |  | 751,728 |  |  | — |  |  | — |
Corporate Bonds | 3,971,200 |  |  | — |  |  | 3,971,200 |  |  | — |
Government Securities | 3,982,275 |  |  | — |  |  | 3,982,275 |  |  | — |
Municipal Bonds | 3,386,500 |  |  | — |  |  | 3,386,500 |  |  | — |
Other | 1,400,176 |  |  | 1,400,176 |  |  | — |  |  | — |
Long-Term Investments: |  |  |  |  |  |  |
Asset-backed Securities | 41,766,104 |  |  | — |  |  | 41,766,104 |  |  | — |
Corporate Bonds | 54,537,517 |  |  | — |  |  | 54,537,517 |  |  | — |
Governmental Securities | 6,199,535 |  |  | — |  |  | 6,199,535 |  |  | — |
Municipal Bonds | 39,458,318 |  |  | — |  |  | 39,458,318 |  |  |
VOXX Common Stock | 47,702,903 |  |  | 47,702,903 |  |  | — |  |  | — |
Total | $ | 439,326,955 |  |  | $ | 283,173,573 |  |  | $ | 156,153,382 |  |  | $ | — |
The amortized cost, unrealized gains and losses, and market value of investment securities are shown below as of September 30, 2025 and December 31, 2024. As of September 30, 2025:
|  |  | Unrealized |  |
| Cost |  | Gains |  | Losses |  | Market Value
Short-Term Investments: |  |  |  |  |  |  |
Corporate Bonds | 2,251,999 |  |  | 9,854 |  |  | — |  |  | 2,261,853 |
Other | 838,907 |  |  | — |  |  | — |  |  | 838,907 |
Long-Term Investments: |  |  |  |  |  |  |
Asset-backed Securities | 29,764,908 |  |  | 1,039,037 |  |  | — |  |  | 30,803,945 |
Corporate Bonds | 37,702,921 |  |  | 718,334 |  |  | (151,942) |  |  | 38,269,313 |
Municipal Bonds | 16,641,509 |  |  | 350,251 |  |  | (190,082) |  |  | 16,801,678 |
Total | $ | 87,200,244 |  |  | $ | 2,117,476 |  |  | $ | (342,024) |  |  | $ | 88,975,696 |
As of December 31, 2024:
|  |  | Unrealized |  |
| Cost |  | Gains |  | Losses |  | Market Value
Short-Term Investments: |  |  |  |  |  |  |
Asset-Backed Securities | $ | 2,834,713 |  |  | $ | 17,220 |  |  | $ | — |  |  | $ | 2,851,933 |
Certificate of Deposit | 750,000 |  |  | 1,728 |  |  | — |  |  | 751,728 |
Corporate Bonds | 4,013,735 |  |  | — |  |  | (42,535) |  |  | 3,971,200 |
Government Securities | 3,981,161 |  |  | 1,114 |  |  | — |  |  | 3,982,275 |
Municipal Bonds | 3,400,019 |  |  | 472 |  |  | (13,991) |  |  | 3,386,500 |
Other | 1,400,176 |  |  | — |  |  | — |  |  | 1,400,176 |
Long-Term Investments: |  |  |  |  |  |  |
Asset-backed Securities | 41,372,112 |  |  | 620,756 |  |  | (226,764) |  |  | 41,766,104 |
Corporate Bonds | 54,552,964 |  |  | 355,627 |  |  | (371,074) |  |  | 54,537,517 |
Government Securities | 6,206,437 |  |  | 13,124 |  |  | (20,026) |  |  | 6,199,535 |
Municipal Bonds | 40,542,837 |  |  | 209,564 |  |  | (1,294,083) |  |  | 39,458,318 |
VOXX Common Stock | 48,774,886 |  |  | 7,502,949 |  |  | (8,574,932) |  |  | 47,702,903 |
Total | $ | 207,829,040 |  |  | $ | 8,722,554 |  |  | $ | (10,543,405) |  |  | $ | 206,008,189 |
Unrealized losses on available-for-sale securities as of September 30, 2025, are as follows:
| Aggregate Unrealized Losses |  | Aggregate Fair Value of Investments
Loss duration of less than one year | $ | 114,935 |  |  | $ | 2,990,364 |
Loss duration of greater than one year | 227,089 |  |  | 5,461,055 |
Total | $ | 342,024 |  |  | $ | 8,451,419 |
Unrealized losses on available-for-sale securities as of December 31, 2024, are as follows:
| Aggregate Unrealized Losses |  | Aggregate Fair Value of Investments
Loss duration of less than one year | $ | 587,357 |  |  | $ | 46,365,022 |
Loss duration of greater than one year | 1,381,116 |  |  | 32,602,844 |
Total | $ | 1,968,473 |  |  | $ | 78,967,866 |
The Company utilizes the guidance provided by ASC 326 - Financial Instruments - Credit Losses, which provides an accounting model for purchased financial assets with credit deterioration since their origination, to determine whether any of the available-for-sale debt securities held by the Company are impaired. No such investments were considered to be impaired during the periods presented. The Company has the intention and current ability to hold its debt investments until any amortized cost basis has been recovered. Fixed income securities as of September 30, 2025 have contractual maturities as follows:
Due within one year | $ | 2,261,853 |
Due between one and five years | 41,483,834 |
Due over five years | 44,391,102 |
| $ | 88,136,789 |

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