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Fair Value
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value

NOTE 5 – FAIR VALUE

The Company follows the authoritative guidance for fair value measurement and the fair value option for financial assets and financial liabilities. The Company carries its financial instruments at fair value with the exception of its note receivable, deferred consideration from divestitures, short-term debt, and long-term debt. Fair value is defined as the exchange price that

would be received for an asset or paid to transfer a liability, or an exit price, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The established fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value:

 

Level 1

Quoted prices in active markets for identical assets.

 

 

Level 2

Observable market-based inputs or unobservable inputs that are corroborated by market data.

 

 

Level 3

Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

When applying fair value principles in the valuation of assets and liabilities, the Company is required to maximize the use of quoted market prices and minimize the use of unobservable inputs. The Company calculates the fair value of its Level 1 and Level 2 instruments based on the exchange traded price of similar or identical instruments, where available, or based on other observable inputs.

The Company’s derivative financial instruments (as described in Note 4—Financial Instruments), consisting of foreign currency forward contracts, are reported at fair value on a recurring basis and classified as Level 2.

Financial Instruments Not Recorded at Fair Value

The following table presents the fair value hierarchy for the Company’s assets and liabilities recorded at their carrying amount, but for which the fair value is disclosed (in thousands):

 

 

June 30, 2025

 

 

December 31, 2024

 

 

 

Carrying
Amount

 

 

Estimated
Fair Value

 

 

Carrying
Amount

 

 

Estimated
Fair Value

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Note receivable, noncurrent

 

$

30,857

 

 

$

33,253

 

 

$

29,702

 

 

$

28,223

 

Deferred consideration from divestitures(1)

 

 

19,029

 

 

 

21,219

 

 

 

18,217

 

 

 

18,342

 

Total assets

 

$

49,886

 

 

$

54,472

 

 

$

47,919

 

 

$

46,565

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Senior unsecured promissory note

 

$

—

 

 

$

—

 

 

$

50,000

 

 

$

50,000

 

AR Facility

 

$

40,000

 

 

$

40,000

 

 

$

—

 

 

$

—

 
(1)
Includes $11.6 million as of June 30, 2025 of the net carrying amount of the holdback consideration from the Perceive Transaction (as described in Note 6—Divestitures), which approximates its associated fair value and is classified as current in the condensed consolidated balance sheets.

The fair value of the note receivable, including accrued interest, and the deferred consideration resulting from the AutoSense Divestiture and the Perceive Transaction were estimated based on an income and market approach with valuation inputs such as the U.S. Treasury constant maturity yields, comparable bond yields, and credit spreads over the term of the same or similarly issued instruments. They are classified within Level 2 of the fair value hierarchy.

Debt is classified within Level 2 of the fair value hierarchy. As of December 31, 2024, short-term debt included the senior unsecured promissory note. The carrying amount of the senior unsecured promissory note approximated fair value due to its short-term maturity. As of June 30, 2025, long-term debt included the AR Facility with a floating interest rate based on market conditions. The carrying amount of the AR Facility approximates fair value. Refer to Note 8—Debt and Receivables Securitization for additional information on these two debt instruments.