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Commitments and Contingencies | 12 Months Ended
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Dec. 31, 2025
Commitments and Contingencies Disclosure [Abstract] |
Commitments and Contingencies | Commitments and Contingencies Operating Lease Obligations The Company leases office, warehouse and manufacturing facilities under operating leases in San Leandro, CA, Tracy, CA and Katy, TX that expire on various dates through fiscal year 2030. The following table presents a summary of operating lease, right of use assets and lease liabilities. The following table presents certain facts regarding the Company’s material property leases.
Location |  | Purpose |  | Square Footage |  | Expiration (1) |  | Option to Extend (2)
San Leandro, California |  | Headquarters, R&D and manufacturing |  | 171,000 |  | December-2028 |  | 1 / 5 years
Tracy, California |  | Manufacturing and warehouse |  | 54,429 |  | April-2030 |  | 1 / 5 years
Katy, Texas |  | Sublease |  | 221,220 |  | December-2029 |  | 2 / 5 years
(1)Month-Year of original lease expiration. (2)Number of renewal option(s) / Number of year(s) per renewal option. Sublease On March 10, 2025, the Company entered into an agreement to sublease its Katy, Texas operating lease. The sublease commenced on March 10, 2025 and will expire on December 31, 2029. The sublease is classified as an operating lease and has a remaining lease term of 4.0 years as of December 31, 2025. Sublease income was immaterial during the year ended December 31, 2025 and is recorded as a reduction of lease expense in general and administrative within the Company’s Consolidated Statements of Operations. The Company considered the sublease to be an indicator of impairment of the original lease. The Company compared the undiscounted cash flows from the sublease to the carrying value of the Katy, Texas operating lease, which included the associated right-of- use asset and leasehold improvements. The Company concluded that the carrying value was not recoverable as it exceeded the estimated undiscounted cash flows. The Company calculated the impairment charge by comparing the carrying value of the Katy, Texas operating lease to its fair value, which was calculated based on the net discounted cash flows associated with the sublease. The Company recorded a total impairment charge of $0.4 million during the year ended December 31, 2025, of which $0.2 million and $0.2 million was recorded against the right-of-use asset and the associated leasehold improvements, respectively. The allocation of the impairment charge was based on the relative carrying value of the assets. The impairment charge was recorded in general and administrative within the Company’s Consolidated Statements of Operations. The following table presents operating lease activities related to all leased properties.
| Years Ended December 31,
| 2025 |  | 2024 |  | 2023
(In thousands) |
Operating lease expense | $2,643 |  | $2,571 |  | $2,571
Cash payments | 2,759 |  | 2,812 |  | 2,580
The following table presents other information related to outstanding operating leases as of December 31, 2025.
Weighted average remaining lease term | 3.5 years
Weighted average discount rate | 7.0%
As of December 31, 2025, t he following table presents the minimum lease payments by year under noncancelable operating leases, exclusive of execution costs.
Year |  | Lease Liabilities
|  | (In thousands)
2026 |  | $3,016
2027 |  | 3,107
2028 |  | 3,201
2029 |  | 1,070
2030 |  | 211
2031 and thereafter |  | —
Total future minimum lease payments |  | 10,605
Less imputed lease interest |  | (1,176)
Total lease liabilities |  | $9,429
Warranty The following table presents the c hanges in the Company’s accrued product warranty reserve.
| Years Ended December 31,
| 2025 |  | 2024 |  | 2023
(In thousands) |
Warranty reserve balance, beginning of year | $1,090 |  | $1,057 |  | $968
Warranty costs charged to cost of revenue | 370 |  | 490 |  | 515
Utilization charges against reserve | (160) |  | (251) |  | (92)
Release of accrual related to expired warranties | (1,095) |  | (206) |  | (334)
Warranty reserve balance, end of year | $205 |  | $1,090 |  | $1,057
Guarantees The Company enters into indemnification provisions under its agreements with other companies in the ordinary course of business, typically with its customers. Under these provisions, the Company generally indemnifies and holds harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of the Company’s activities, generally limited to personal injury and property damage caused by the Company’s employees at a customer’s plant, and in proportion to the employee’s percentage of fault for the accident. Damages incurred for these indemnifications would be covered by the Company’s general liability insurance to the extent provided by the policy limitations. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the estimated valuation of the potential liability arising from these agreements is not material. Accordingly, the Company recorded no liabilities for these agreements as of December 31, 2025 and 2024. In certain cases, the Company issues product warranty and performance guarantees to its customers for amounts generally equal to 10% or less of the total sales agreement to endorse the execution of product delivery and to the warranty of design work, fabrication and operating performance of the Company’s devices. These guarantees are generally LCs that have a weighted average life at inception of 36 months. See Note 6, “Lines of Credit – Letters of Credit,” for information related to LCs. Litigation From time-to-time, the Company has been named in and subject to various proceedings and claims in connection with its business. The Company may in the future become involved in litigation in the ordinary course of business, including litigation that could be material to its business. The Company considers all claims, if any, on a quarterly basis and, based on known facts, assesses whether potential losses are considered reasonably possible, probable and estimable. Based upon this assessment, the Company then evaluates disclosure requirements and whether to accrue for such claims in its consolidated financial statements. The Company records a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and are adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. As of December 31, 2025, the Company was not involved in any lawsuits, legal proceedings or claims that would have a material effect on the Company’s financial position, results of operations, or cash flows. Therefore, there were no material losses which were probable or reasonably estimable and accordingly, the Company did not record a provision for litigation as of December 31, 2025 and 2024.

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