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Leases

9 Months Ended

Sep. 30, 2024

14.Leases

Lessee Arrangements

On July 31, 2020, the Company entered into a 61-month lease agreement for office space to use, as necessary, for office administration, lab space and assembly and storage purposes, located in Santa Clara, California. The Company took possession of the leased office space in September 2020, and the lease is effective through September 30, 2025.

As of September 30, 2024, the remaining lease term is 12 months with no options to renew. The Company recognized facilities lease expenses of $22 and $22 for the three months ended September 30, 2024 and 2023, respectively. The Company recognized facilities lease expenses of $66 and $66 for the nine months ended September 30, 2024 and 2023, respectively. The following table summarizes the future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms greater than one year as of September 30, 2024:


	Total
2024 Remaining period		24
2025		71
Total undiscounted future minimum lease payments		95
Less: present value discount		(2)
Total lease liabilities		93
Lease expense in excess cash payment		(6)
Total ROU asset	$	87

As of September 30, 2024, the Company’s ROU asset was $87, which was recorded on the Company’s balance sheet as other noncurrent assets, and the Company’s current lease liability was $93, which was recorded on the Company’s balance sheet as other short-term liabilities. The Company used a discount rate of 2.5% for calculating ROU and lease liability.

Lessor Arrangements

The Company enters into contracts with customers for the Company’s QuantaFlo product. The Company has determined these contracts meet the definition of a lease under Topic 842. The lease portfolio primarily consists of operating leases that are short-term in nature (monthly, quarterly or one year, all of which have renewal options). During the three months ended September 30, 2024 and 2023, the Company recognized approximately $6,780 and $9,539, respectively, in lease revenues related to these arrangements, which is included in Revenues on the Unaudited Condensed Statements of Income. During the nine months ended September 30, 2024 and 2023, the Company recognized approximately $20,633 and $28,462, respectively, in lease revenues related to these arrangements, which is included in Revenues on the Unaudited Condensed Statements of Income. The Company made an accounting policy election to apply the practical expedient to not separate lease and eligible non-lease components. The lease component is the predominant component and consists of fees charged for use of the equipment over the period of the arrangement. The nature of the eligible non-lease component is primarily software support. The assets associated with these leasing arrangements are included in Assets for Lease, net on the Unaudited Condensed Balance Sheets as Assets (see Note 5).