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Acquisition | 12 Months Ended
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Dec. 31, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract] |
Acquisition | Acquisition On August 14, 2025 (the “Closing Date”), the Company, through its indirect wholly owned subsidiary STINorland USA, Inc., a California corporation (“Buyer”), completed the APA Acquisition, pursuant to the terms of the equity purchase agreement, dated as of June 17, 2025, by and among the Company, Buyer, APA, SunHoldings, LLC, an Ohio limited liability company (“Seller”), and the guarantors party thereto (as amended, the “Purchase Agreement”). The cash consideration paid was approximately $166.1 million. The Purchase Agreement also includes an earnout provision estimated to have a fair value of approximately $19.3 million as of the Closing Date (the “Earnout Consideration”), under which the Seller may receive shares of Company common stock, or equivalent cash value at the Buyer’s discretion, based upon APA’s achievement of certain financial performance targets during the three-year period ending on September 30, 2028. As a result, the purchase consideration approximates $185.4 million. Subject to the terms and conditions set forth in the Purchase Agreement, the Company has also agreed to pay aggregate deferred consideration of approximately $40.0 million payable in three installments over a two-year period based on service within five business days after the first and second anniversaries from the Closing Date and as set forth below (the “Deferred Consideration”). Each of the Earnout Consideration and Deferred Consideration are described in more detail below. The Company is currently finalizing the valuation of the acquired assets and liabilities and assessing the related accounting impacts. The purchase consideration to acquire APA consisted of the following:
Cash consideration paid |  | 166,135 |
Earn-out |  | 19,256 |
Purchase consideration |  | $ | 185,391 |
Earnout Consideration The Purchase Agreement includes an earnout provision pursuant to which Seller may be granted shares of the Company’s common stock, or equivalent cash value at the Buyer’s discretion, based upon APA’s achievement of certain financial performance targets during the three-year period ending September 30, 2028. The maximum number of shares payable as Earnout Consideration is 4,686,530 shares of common stock, which was determined by dividing $40 million by the volume weighted average price of the Company’s common stock for the 10 trading days immediately following the Closing Date. The number of shares payable will be subject to reduction if the cumulative value of the Earnout Consideration earned (measured on each date such shares are issued) exceeds $90 million. The Purchase Agreement provides that, to the extent the issuance of any Earnout Consideration or Deferred Consideration Shares would require stockholder approval under Nasdaq Listing Rule 5635(a), the Company will pay cash in lieu of issuing such shares, unless such stockholder approval has been obtained. The principal Seller continues to assume the managerial responsibilities of APA. The Earnout Consideration is accounted for as contingent consideration, and the fair value is estimated each reporting period. As of the Closing Date, the Earnout Consideration was estimated to have a fair value of approximately $19.3 million using a Monte-Carlo simulation method. Changes in fair value of the contingent liability are recognized in Change in fair value of contingent consideration in the consolidated statements of operations. Estimating the amount of payments that may be made under the Earnout Consideration is by nature imprecise. The significant fair value inputs used to estimate the future expected Earnout Consideration payments to Seller include a discount rate, earnings forecasts, and actual and estimated future volatility in the Company’s stock price. Deferred Consideration Installments The Deferred Consideration which will be payable to Seller in three installments (each, a “Deferred Consideration Installment”): (i) within five business days after the first anniversary of the Closing Date, an amount equal to 50% of the Deferred Consideration; (ii) on December 31, 2026, an amount equal to (A) 50% of the Deferred Consideration multiplied by (B) the proportion of the two-year period from the Closing Date to the second anniversary of the Closing Date that has elapsed as of December 31, 2026; and (iii) within five business days after the second anniversary of the Closing Date, an amount equal to the remaining balance of the Deferred Consideration. As more fully described in the Purchase Agreement, the Deferred Consideration Installments are subject to reduction if certain equity holders of Seller cease to be employees of the Company under certain circumstances. Each Deferred Consideration Installment will, at the Company’s election, be paid: (i) in cash; (ii) through the issuance of shares of Company common stock, par value $0.001 per share, valued at the closing price on the trading day immediately preceding the applicable Deferred Consideration Anniversary (if any such shares are issued, the “Deferred Consideration Shares”); or (iii) by any combination of the foregoing. As the Deferred Consideration Installments are tied to future service to the Company, they are considered compensatory and not included in purchase consideration. Purchase Price Allocation The APA Acquisition was accounted for as a business combination applying ASC 805. The allocation of the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed was based on their estimated fair values as of the date of acquisition. Goodwill was calculated as the excess of the consideration transferred over the net assets recognized and represents the estimated future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. The factors contributing to the recognition of goodwill were the expected synergies of the combined entities that are expected to be realized from the APA Acquisition. The goodwill is deductible for tax purposes. The following table summarizes the fair values of the assets acquired and liabilities assumed as of the Closing Date (in thousands):
Preliminary fair value of net assets acquired and liabilities assumed: |  | Acquisition Date |  | Measurement Adjustment |  | Remeasured Acquisition Date
Cash and cash equivalents |  | $ | 1,219 |  |  | $ | — |  |  | $ | 1,219 |
Accounts receivable |  | 29,043 |  |  | 81 |  |  | 29,124 |
Inventories |  | 25,467 |  |  | (331) |  |  | 25,136 |
Prepaid expenses and other |  | 466 |  |  | — |  |  | 466 |
Property, plant and equipment |  | 14,256 |  |  | — |  |  | 14,256 |
Other intangible assets |  | 80,800 |  |  | 7,200 |  |  | 88,000 |
Other assets |  | 27,050 |  |  | 194 |  |  | 27,244 |
Total assets acquired |  | $ | 178,301 |  |  | $ | 7,144 |  |  | $ | 185,445 |
Accounts payable |  | 12,540 |  |  | — |  |  | 12,540 |
Deferred revenue |  | 22,121 |  |  | 208 |  |  | 22,329 |
Other liabilities |  | 4,079 |  |  | 59 |  |  | 4,138 |
Other long-term liabilities |  | 26,330 |  |  | 163 |  |  | 26,493 |
Total liabilities assumed |  | $ | 65,070 |  |  | $ | 430 |  |  | $ | 65,500 |
Preliminary fair value of net assets acquired |  | 113,231 |  |  | 6,714 |  |  | 119,945 |
Preliminary allocation to goodwill |  | $ | 72,911 |  |  | $ | (7,465) |  |  | $ | 65,446 |
The amounts recorded as of December 31, 2025 are preliminary, as the Company is finalizing working capital, post-closing, and other customary adjustments. These preliminary estimates are subject to change within the measurement period (defined as the twelve months following the Closing Date) and related accounting adjustments may be materially different, as the Company obtains additional information on these matters and as additional information is made known during the post-acquisition measurement period. As a result of further refining its estimates and assumptions since the date of the acquisition, the Company recorded measurement period adjustments to the initial opening balance sheet as shown in the table above. There were no measurement period adjustments materially impacting earnings that would have been recorded in previous reporting periods if the adjustments had been recognized as of the acquisition date. The preliminary purchase price allocation includes $88.0 million of acquired identifiable intangible assets as follows:
|  | Estimated Fair Value (in USD) |  | Estimated Weighted Average Useful Life in Years
(in thousands, except useful lives) |  |
Developed technology |  | $ | 22,000 |  |  | 5
Computer software and other |  | 13,000 |  |  | 5
Customer relationships |  | 39,500 |  |  | 5-9
Backlog |  | 3,500 |  |  | 1
Trade name |  | 10,000 |  |  | 10
Total |  | $ | 88,000 |  |  |
The preliminary fair value of the identifiable intangible assets has been estimated using the Multi-Period Excess Earnings Method (Customer relationships and Backlog), Relief from Royalty Method (Trade name), and Replacement Cost Method (Developed technology and Computer software and other). The intangible assets are being amortized over their estimated useful lives on a straight-line basis that reflects the economic benefit of the asset. The determination of the useful lives is based upon various industry studies, historical acquisition experience, economic factors, and future forecasted cash flows of the Company following the APA Acquisition. Direct transaction costs incurred related to the APA Acquisition were $9.4 million and are included in General and administrative expenses in the consolidated statements of operations. Included in the Company’s consolidated statements of operations from the Closing Date of August 14, 2025 through December 31, 2025 are revenue of $50.0 million and an operating loss of $6.3 million, inclusive of $7.5 million of expenses related to the Deferred Consideration and $6.4 million of amortization expense related to identified intangible assets. Pro Forma Financial Information (Unaudited) The following unaudited pro forma financial information presents the combined results of operations of the Company and APA as if the acquisition had occurred on January 1, 2024, after giving effect to certain unaudited pro forma adjustments. The unaudited pro forma adjustments reflected herein include only those adjustments that are directly attributable to the APA Acquisition and factually supportable. The unaudited pro forma financial information does not reflect any adjustments for anticipated expense savings resulting from the APA Acquisition and is not necessarily indicative of the operating results that would have actually occurred had the APA Acquisition been consummated on January 1, 2024. These results are prepared in accordance with U.S. GAAP (in thousands):
| Year Ended December 31,
| 2025 |  | 2024
Revenue | $ | 1,363,762 |  |  | $ | 1,045,103 |
Net loss | 57,487 |  |  | 254,957 |
Pro forma adjustments(1) | $ | 17,790 |  |  | $ | 39,989 |
(1) Pro forma adjustments represent re-casting of transaction costs and incremental expenses, net of estimated taxes, resulting from the APA Acquisition, including Deferred Consideration expense, intangible asset amortization, and the impacts of lease re-measurements and increases to the fair value of inventories and property, plant and equipment.

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