Restructuring and Exit Activity Costs

12 Months Ended

Dec. 31, 2023

Restructuring and Related Activities [Abstract]

(25) Restructuring and Exit Activity Costs

Restructuring Plan Objectives and Phases

In February 2023, the Company announced the first phase of its multi-faceted restructuring initiative to improve operating efficiencies throughout the organization and drive long-term value creation. The objective of this first phase was to improve manufacturing efficiencies related to our European metal printer operations. Actions taken under this initiative include the in-sourcing of certain metal printer platforms into the Company’s Riom, France manufacturing facility, co-locating the manufacturing and engineering of the in-sourced metal printer products in order to improve cycle time from development to production.

In May 2023, the Company announced the next phase of its multi-faceted restructuring initiative, which primarily consisted of a reduction in headcount representing approximately 6% of the Company's workforce. The majority of this targeted workforce reduction related to corporate and business support functions predominately located in the U.S. and Europe.

In October 2023, the Company announced the latest phase of its multi-faceted restructuring initiative, which is primarily targeted at continuing to rationalize headcount, as well as the rationalization of geographic locations (i.e., leased facilities), in all functions across the Company and the reduction of certain third-party costs.

We currently expect the execution of our restructuring initiatives to result in the recognition of aggregate charges in the range of $8,500 to $10,000, inclusive of $8,242 which has been recognized in our consolidated statement of operations for the year ended December 31, 2023. These charges relate to employee severance and termination benefit costs that are generally recognized when probable and estimable because they are typically being determined consistent with the Company’s past practices or statutory law. In addition, we will incur additional cash expenditures related to our planned facility exits and relocation activities, which will be recognized as incurred.

We currently expect the execution of our restructuring plan, including the cash settlement of associated liabilities, to be substantially complete by December 31, 2024.

Status of Our Initiatives

Headcount

The Company has substantially completed the initial phase of headcount reductions announced in May 2023. Actions related to the incremental headcount reductions announced in October 2023 commenced in November 2023 and are expected to continue throughout 2024.

Facilities Rationalization

During the three months ended December 31, 2023, the Company (1) commenced the process of identifying leased facilities that it may exit and (2) began developing and executing plans to exit and potentially sublease such facilities. The decision-making, planning and execution of these activities will continue throughout 2024. To date, we have identified certain facilities that we have committed to exiting. However, the Company’s consolidated financial statements as of and for the year ended December 31, 2023 do not include material transactions resulting from such decisions because the Company generally had not ceased use of such facilities as of December 31, 2023. In addition, we have identified several additional facilities that we continue to evaluate for opportunities to exit.

Costs Incurred and Settled During the Period

The following table provides details regarding restructuring charges recorded during the period, the portion of such costs that were settled with cash as of December 31, 2023, and the remaining accrued liability reported in our consolidated balance sheet as of December 31, 2023:


(in thousands)	Accrued liability as of December 31, 2022		Costs incurred during 2023		Amounts settled with cash		Accrued liability as of December 31, 2023
Severance, termination benefits and other employee costs	$	—	$	8,242	$	4,309	$	3,933

The severance, termination benefits and other employee costs that have been incurred during the year ended December 31, 2023 are reflected in our consolidated statement of operations as follows:


(in thousands)	Year Ended December 31, 2023
Total cost of sales	$	1,401
Selling, general and administrative	5,598
Research and development	1,243
Total	$	8,242

In addition to the severance and termination costs reported above, the Company has recognized incremental impairment charges totaling $628 related to certain fixed assets that have been retired in connection with the Company’s restructuring activities.

Restructuring Plan Announced August 2020

On August 5, 2020, we announced a restructuring plan, which focused on a reduction of our headcount and the closing of certain facilities. During the year ended December 31, 2021, we finalized all actions related to this plan and recognized related costs totaling $1,121 within selling, general and administrative in our consolidated statement of operations for the period.