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Fair Value Measurements | 6 Months Ended
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Jun. 30, 2026
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Fair Value Measurements The Company measures certain financial instruments at fair value on a recurring basis in accordance with FASB ASC Topic 820, Fair Value Measurement ("ASC 820"). Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a three-level hierarchy for inputs used in measuring fair value, which prioritizes observable inputs over unobservable inputs. The three levels of the fair value hierarchy are as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies, and similar techniques. The level in the fair value hierarchy within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair value (in thousands):
| As of June 30, 2026
| Level 1 |  | Level 2 |  | Level 3 |  | Total
Assets: |  |  |  |  |  |  |
Money Market | 96,632 |  |  | $ | — |  |  | $ | — |  |  | $ | 96,632 |
Total Assets | $ | 96,632 |  |  | $ | — |  |  | $ | — |  |  | $ | 96,632 |
Liabilities: |  |  |  |  |  |  |
Debt, net | $ | — |  |  | $ | 1,749 |  |  | $ | — |  |  | $ | 1,749 |
Derivative liability | $ | — |  |  | $ | — |  |  | $ | 33,708 |  |  | $ | 33,708 |
Total liabilities | $ | — |  |  | $ | 1,749 |  |  | $ | 33,708 |  |  | $ | 35,457 |
| As December 31, 2025
| Level 1 |  | Level 2 |  | Level 3 |  | Total
Assets: |  |  |  |  |  |  |
Money Market | $ | 17,407 |  |  | $ | — |  |  | $ | — |  |  | $ | 17,407 |
Total assets | $ | 17,407 |  |  | $ | — |  |  | $ | — |  |  | $ | 17,407 |
Liabilities: |  |  |  |  |  |  |
Debt, net | $ | — |  |  | $ | 28,792 |  |  | $ | — |  |  | $ | 28,792 |
Total liabilities | $ | — |  |  | $ | 28,792 |  |  | $ | — |  |  | $ | 28,792 |
The Company estimates the fair value of borrowings under the EB-5 Loan Agreement, and the Avenue Capital Loan, which was settled as of June 30, 2026, and the Security Agreement (as defined in Note 10) using Level 2 inputs. The valuation technique applied is a discounted cash flow analysis. The discount rate utilized is derived from the Company's Incremental Borrowing Rate Analysis, which incorporates observable market interest rates and credit spreads for instruments with similar terms and maturities. Management believes the estimated fair value does not differ materially from the carrying value of these borrowings. See Note 10 for additional information. During the three months ended June 30, 2026, the Company issued Convertible Notes (see Note 9) containing an embedded conversion feature that was determined to require bifurcation and separate accounting as a derivative liability under ASC 815. The estimated fair value of the Convertible Notes was $117.0 million as of June 30, 2026. The embedded derivative was initially recognized at its estimated fair value upon issuance of the note and is recorded under current liabilities in the condensed consolidated balance sheet. This derivative liability is subsequently remeasured to fair value at each reporting date, with changes in fair value recognized in the condensed consolidated statements of operations. The fair value of the Company’s derivative liability is classified as Level 3 under the fair value hierarchy as it has been valued using a binomial model with certain observable and unobservable inputs. These inputs include: (1) Company's stock price ($1.53 as of June 30, 2026), (2) volatility (55% as of June 30, 2026, after applying a volatility haircut to the Company's equity volatility, (3) risk-free interest rate (4.35% based on a 7.9 year term), and (4) credit spread of 12.6%. Significant increases or decreases in any of those inputs in isolation could result in a significantly lower or higher fair value measurement. The following table sets forth a summary of the changes in fair value of the Level 3 liabilities for the six months ended June 30, 2026 (in thousands):
| Amount |
Balance at January 1, 2026 | $ | — |  |
Initial recognition of embedded derivative upon issuance of convertible note | 31,817 |  |
Change in fair value recognized in earnings | 1,891 |  |
Balance as of June 30, 2026 | $ | 33,708 |  |

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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