10-Q 1 aeva-20240331.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission File Number: 001-39204

 

AEVA TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

84-3080757

( State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

555 Ellis Street

Mountain View, CA

94043

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (650) 481-7070

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common stock, $0.0001 par value per share

 

AEVA

 

New York Stock Exchange

Warrants to purchase one share of common stock

 

AEVA.WS

 

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

 

 

 

 

Non-accelerated filer

Smaller reporting company

 

 

 

 

 

 

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

As of April 25, 2024, the registrant had 52,847,027 shares of common stock, $0.0001 par value per share, outstanding.

 

 


 

Table of Contents

 

Page

PART I.

FINANCIAL INFORMATION

Item 1.

Financial Statements (Unaudited)

4

Condensed Consolidated Balance Sheets

4

Condensed Consolidated Statements of Operations and Comprehensive Loss

5

Condensed Consolidated Statements of Stockholders' Equity

6

Condensed Consolidated Statements of Cash Flows

8

Notes to the Condensed Financial Statements (Unaudited)

9

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

19

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

24

Item 4.

Controls and Procedures

24

PART II.

OTHER INFORMATION

Item 1.

Legal Proceedings

25

Item 1A.

Risk Factors

25

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

25

Item 3.

Defaults Upon Senior Securities

25

Item 4.

Mine Safety Disclosures

25

Item 5.

Other Information

25

Item 6.

Exhibits

26

Signatures

27

 

 

 

 


SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) regarding future events and our future results that are subject to the safe harbors created under the Securities Act and the Exchange Act. All statements contained in this report other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “goal,” “plan,” “intend,” “expect,” “seek”, and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 under the heading “Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

 

You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. We are under no duty to update any of these forward-looking statements after the date of this report or to conform these statements to actual results or revised expectations.

 

As used in this report, the terms “Aeva,” “we,” “us,” “our,” and “the Company” mean Aeva Technologies, Inc. and its subsidiaries unless the context indicates otherwise.

 

3


PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

AEVA TECHNOLOGIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT PAR VALUE)

(UNAUDITED)

 

 

 

March 31, 2024

 

 

December 31, 2023

 

Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

29,605

 

 

$

38,547

 

Marketable securities

 

 

159,723

 

 

 

182,481

 

Accounts receivable

 

 

978

 

 

 

628

 

Inventories

 

 

2,163

 

 

 

2,374

 

Other current assets

 

 

4,882

 

 

 

5,195

 

Total current assets

 

 

197,351

 

 

 

229,225

 

Operating lease right-of-use assets

 

 

6,444

 

 

 

7,289

 

Property, plant and equipment, net

 

 

12,552

 

 

 

12,114

 

Intangible assets, net

 

 

2,400

 

 

 

2,625

 

Other noncurrent assets

 

 

6,062

 

 

 

6,132

 

Total assets

 

$

224,809

 

 

$

257,385

 

Liabilities and stockholders' equity

 

 

 

 

 

 

Accounts payable

 

$

3,424

 

 

$

3,602

 

Accrued liabilities

 

 

2,639

 

 

 

2,648

 

Accrued employee costs

 

 

2,443

 

 

 

6,043

 

Lease liability, current portion

 

 

3,681

 

 

 

3,587

 

Other current liabilities

 

 

4,406

 

 

 

2,524

 

Total current liabilities

 

 

16,593

 

 

 

18,404

 

Lease liability, noncurrent portion

 

 

2,807

 

 

 

3,767

 

Warrant liability

 

 

7,209

 

 

 

6,772

 

Total liabilities

 

 

26,609

 

 

 

28,943

 

Commitments and contingencies (Note 14)

 

 

 

 

 

 

Convertible preferred stock $0.0001 par value; 10,000 shares authorized; no shares issued and
outstanding

 

 

 

 

 

 

Common stock $0.0001 par value; 422,000 shares authorized; 52,816 and 52,389 shares issued
   and outstanding at March 31, 2024 and December 31, 2023, respectively

 

 

5

 

 

 

5

 

Additional paid-in capital

 

 

693,369

 

 

 

688,124

 

Accumulated other comprehensive loss

 

 

(248

)

 

 

(87

)

Accumulated deficit

 

 

(494,926

)

 

 

(459,600

)

Total stockholders' equity

 

 

198,200

 

 

 

228,442

 

Total liabilities and stockholders' equity

 

$

224,809

 

 

$

257,385

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

4


AEVA TECHNOLOGIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(UNAUDITED)

 

 

 

Three Months Ended March 31,

 

 

 

2024

 

 

2023

 

Revenue

 

$

2,107

 

 

$

1,148

 

Cost of revenue

 

 

3,499

 

 

 

2,529

 

Gross loss

 

 

(1,392

)

 

 

(1,381

)

Operating expenses:

 

 

 

 

 

 

Research and development expenses

 

 

25,012

 

 

 

25,454

 

General and administrative expenses

 

 

8,411

 

 

 

7,833

 

Selling and marketing expenses

 

 

2,529

 

 

 

2,598

 

Total operating expenses

 

 

35,952

 

 

 

35,885

 

Operating loss

 

 

(37,344

)

 

 

(37,266

)

Interest income

 

 

2,458

 

 

 

2,064

 

Other income (expense), net

 

 

(439

)

 

 

28

 

Loss before income taxes

 

 

(35,326

)

 

 

(35,174

)

Income tax provision

 

 

 

 

 

 

Net loss

 

$

(35,326

)

 

$

(35,174

)

Unrealized gain (loss) on available-for-sale securities, net of tax

 

 

(161

)

 

 

1,212

 

Total comprehensive loss

 

$

(35,487

)

 

$

(33,962

)

Net loss per share, basic and diluted

 

$

(0.67

)

 

$

(0.80

)

Weighted-average shares used in computing net loss per share, basic and diluted

 

 

52,742,725

 

 

 

43,925,565

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

 

5


AEVA TECHNOLOGIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(IN THOUSANDS, EXCEPT SHARE DATA)

(UNAUDITED)

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

Common stock

 

 

Additional
paid-in

 

 

Other
Comprehensive

 

 

Accumulated

 

 

Total stockholders'

 

 

Shares

 

 

Amount

 

 

capital

 

 

loss

 

 

deficit

 

 

equity

 

Balance at December 31, 2023

 

 

52,388,961

 

 

$

5

 

 

$

688,124

 

 

$

(87

)

 

$

(459,600

)

 

$

228,442

 

Share-based compensation

 

 

 

 

 

 

 

 

5,261

 

 

 

 

 

 

 

 

 

5,261

 

Issuance of common stock upon exercise of stock
   options

 

 

28,227

 

 

 

 

 

 

39

 

 

 

 

 

 

 

 

 

39

 

Issuance of common stock upon release of restricted
   stock units

 

 

423,869

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares withheld for the withholding tax on vesting of restricted
   stock units

 

 

(25,286

)

 

 

 

 

 

(55

)

 

 

 

 

 

 

 

 

(55

)

Unrealized loss on available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

(161

)

 

 

 

 

 

(161

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(35,326

)

 

 

(35,326

)

Balance as of March 31, 2024

 

 

52,815,771

 

 

$

5

 

 

$

693,369

 

 

$

(248

)

`

$

(494,926

)

 

$

198,200

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

6


AEVA TECHNOLOGIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(IN THOUSANDS, EXCEPT SHARE DATA)

(UNAUDITED)

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

Common stock

 

 

Additional
paid-in

 

 

Other
Comprehensive

 

 

Accumulated

 

 

Total stockholders'

 

 

Shares

 

 

Amount

 

 

capital

 

 

loss

 

 

deficit

 

 

equity

 

Balance at December 31, 2022

 

 

43,749,685

 

 

$

4

 

 

$

643,774

 

 

$

(3,585

)

 

$

(310,267

)

 

$

329,926

 

Share-based compensation

 

 

 

 

 

 

 

 

5,963

 

 

 

 

 

 

 

 

 

5,963

 

Issuance of common stock upon exercise of stock
   options

 

 

47,328

 

 

 

 

 

 

57

 

 

 

 

 

 

 

 

 

57

 

Issuance of common stock upon release of restricted
   stock units

 

 

215,505

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares withheld for the withholding tax on vesting of restricted
   stock units

 

 

(2,499

)

 

 

 

 

 

(20

)

 

 

 

 

 

 

 

 

(20

)

Unrealized gain on available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

1,212

 

 

 

 

 

 

1,212

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(35,174

)

 

 

(35,174

)

Balance as of March 31, 2023

 

 

44,010,019

 

 

$

4

 

 

$

649,774

 

 

$

(2,373

)

`

$

(345,441

)

 

$

301,964

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

7


AEVA TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATE
MENTS OF CASH FLOWS

(IN THOUSANDS)

(UNAUDITED)

 

 

 

Three Months Ended March 31,

 

 

 

2024

 

 

2023

 

Cash flows from operating activities:

 

 

 

 

 

 

Net loss

 

$

(35,326

)

 

$

(35,174

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

1,345

 

 

 

955

 

Impairment of inventories

 

 

465

 

 

 

45

 

Change in fair value of warrant liabilities

 

 

437

 

 

 

(28

)

Stock-based compensation

 

 

5,261

 

 

 

5,963

 

Amortization of right-of-use assets

 

 

845

 

 

 

744

 

Amortization of premium and accretion of discount on available-for-sale securities, net

 

 

(1,087

)

 

 

(632

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

(350

)

 

 

442

 

Inventories

 

 

(251

)

 

 

(100

)

Other current assets

 

 

312

 

 

 

790

 

Other noncurrent assets

 

 

70

 

 

 

 

Accounts payable

 

 

(89

)

 

 

(1,749

)

Accrued liabilities

 

 

(10

)

 

 

(5,207

)

Accrued employee costs

 

 

(3,600

)

 

 

(1,307

)

Lease liability

 

 

(866

)

 

 

(754

)

Other current liabilities

 

 

1,882

 

 

 

 

Net cash used in operating activities

 

 

(30,962

)

 

 

(36,012

)

Cash flows from investing activities:

 

 

 

 

 

 

Purchase of property, plant and equipment

 

 

(1,648

)

 

 

(1,275

)

Purchase of available-for-sale securities

 

 

(38,881

)

 

 

(54,520

)

Proceeds from maturities of available-for-sale securities

 

 

62,565

 

 

 

56,214

 

Net cash provided by investing activities

 

 

22,036

 

 

 

419

 

Cash flows from financing activities:

 

 

 

 

 

 

Payments of taxes withheld on net settled vesting of restricted stock units

 

 

(55

)

 

 

(20

)

Proceeds from exercise of stock options

 

 

39

 

 

 

57

 

Net cash provided by (used in) financing activities

 

 

(16

)

 

 

37

 

Net decrease in cash and cash equivalents

 

 

(8,942

)

 

 

(35,556

)

Beginning cash and cash equivalents

 

 

38,547

 

 

 

67,420

 

Ending cash and cash equivalents

 

$

29,605

 

 

$

31,864

 

Supplemental disclosures of cash flow information:

 

 

 

 

 

 

Cash paid for interest

 

$

 

 

$

 

Cash paid for income taxes

 

$

 

 

$

 

Supplemental disclosures of non-cash investing and financing activities:

 

 

 

 

 

 

Unpaid property, plant and equipment purchases

 

$

 

 

$

503

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

8


AEVA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Note 1. Description of Business and Summary of Significant Accounting Policies

Description of Business

Aeva Technologies, Inc. (the “Company”), through its Frequency Modulated Continuous Wave (“FMCW”) sensing technology, designs a 4D LiDAR-on-chip that, along with its proprietary software applications, has the potential to enable the adoption of LiDAR across broad applications from automated driving to consumer electronics, consumer health, industrial automation and security application.

The Company’s common stock and warrants are listed on the New York Stock Exchange stock market under the symbols “AEVA” and "AEVA.WS".

 

Basis of Presentation and Unaudited Interim Financial Statements

The condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The condensed consolidated financial statements include the accounts of the Company’s wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation.

 

The accompanying condensed consolidated financial statements are unaudited and have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations, comprehensive loss and cash flows for the periods presented, but are not necessarily indicative of the results of operations to be anticipated for any future annual or interim period.

 

These condensed consolidated financial statements and other information presented in this Form 10-Q should be read in conjunction with the consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC.

 

On March 18, 2024, the Company filed a Certificate of Amendment to its Amended and Restated Certificate of Incorporation (the “Amendment”) with the Secretary of State of the State of Delaware to effect a 1-for-5 reverse stock split (the “Reverse Stock Split”) of the Company’s shares of common stock, $0.0001 par value (the “Common Stock”). Pursuant to the Reverse Stock Split, every five (5) shares of issued and outstanding shares of common stock were combined into one (1) share of common stock. Accordingly, unless we indicate otherwise, all the current period and historical per share data, number of shares issued and outstanding, stock awards, and other common stock equivalents for the periods presented in this Interim Report on Form 10-Q have been adjusted retroactively, where applicable, to reflect the Reverse Stock Split. There was no change to the shares authorized or in the par value per share of common stock of $0.0001.

The Reverse Stock Split affected all stockholders uniformly and did not alter any stockholder’s percentage interest in the Company’s equity. The Company did not issue fractional shares in connection with the Reverse Stock Split. Stockholders who were otherwise entitled to fractional shares of common stock were instead entitled to receive a proportional cash payment. The number of shares of common stock issuable under our equity incentive plans and exercisable under the outstanding warrants were also proportionately adjusted.

Principles of Consolidation and Liquidity

The condensed consolidated financial statements are prepared in accordance with U.S. GAAP. The condensed consolidated financial statements include the accounts of the Company’s wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

 

The Company has funded its operations primarily through the Business Combination (the “Business Combination”) with InterPrivate Acquisition Corp. (the Company’s predecessor, which was originally incorporated in Delaware as a special purpose acquisition company (“IPV”)) on March 12, 2021, and issuances of stock. As of March 31, 2024, the Company’s existing sources of liquidity included cash and cash equivalents and marketable securities of $189.3 million. The Company has a limited history of operations and has incurred negative cash flows from operating activities and losses from operations in the past as reflected in the accumulated deficit of $494.9 million as of March 31, 2024. The Company expects to continue to incur operating losses due to the investments it intends to make in its business, including product development. Management believes that existing cash and cash equivalents and marketable securities will be sufficient to fund operating and capital expenditure requirements through at least 12 months from the date of issuance of these financial statements.

Significant Risks and Uncertainties

The Company is subject to those risks common in the technology industry and also those risks common to early stage companies including, but not limited to, the possibility of not being able to successfully develop or market its products, technological obsolescence, competition, dependence on key personnel and key external alliances, the successful protection of its proprietary technologies, compliance with government regulations, and the possibility of not being able to obtain additional financing when needed.

 


Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents, marketable securities, and trade receivables. The Company maintains the majority of its cash and cash equivalents in accounts with large financial institutions. At times, balances in these accounts may exceed federally insured limits; however, to date, the Company has not incurred any losses on its deposits of cash and cash equivalents and believes the exposure to risk of loss is not material. Risks associated with the Company’s marketable securities is mitigated by investing in investment-grade rated securities when purchased.

The Company’s accounts receivable are derived from customers located in the United States, APAC, and Europe. The Company mitigates its credit risks by performing ongoing credit evaluations of its customers’ financial conditions and requires customer advance payments in certain circumstances.

As of March 31, 2024, three customers accounted for 44%, 15% and 12% of the accounts receivable, respectively. As of December 31, 2023, one customer accounted for 42% of accounts receivable. As of March 31, 2024, one vendor accounted for 10% of the accounts payable. As of December 31, 2023, three vendors accounted for 12%, 11% and 11% each of the accounts payable, respectively.

Recent Accounting Pronouncements

In November 2023, the Financial Standards Accounting Board (FASB) issued Accounting Standards Update (ASU) 2023-07 "Segment Reporting (Topic 280):Improvements to Reportable Segment Disclosures" which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for our annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted. The Company does not expect ASU 2023-07 to have a material impact on the Company's financial statements and related disclosures.

 

In December 2023, the FASB issued ASU 2023-09 "Income Taxes (Topics 740): Improvements to Income Tax Disclosures" to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our annual periods beginning January 1, 2025, with early adoption permitted. We are currently evaluating the potential effect that the updated standard will have on our consolidated financial statements and related disclosures.

 

Note 2. Revenue

Disaggregation of Revenues

The Company disaggregates its revenue from contracts with customers by geographic region based on the primary billing address of the customer and timing of transfer of goods or services to customers (point-in-time or over time), as it believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors. Total revenue for the three months ended March 31, 2024 and 2023, based on the disaggregation criteria described above were as follows (in thousands):

 

 

 

Three Months Ended March 31,

 

 

 

2024

 

 

2023

 

 

 

Revenue

 

 

% of Revenue

 

 

Revenue

 

 

% of Revenue

 

Revenue by primary geographical market:

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

$

1,674

 

 

 

79

%

 

$

730

 

 

 

64

%

EMEA

 

 

229

 

 

 

11

%

 

 

244

 

 

 

21

%

Asia

 

 

204

 

 

 

10

%

 

 

174

 

 

 

15

%

Total

 

$

2,107

 

 

 

100

%

 

$

1,148

 

 

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

Revenue by timing of recognition:

 

 

 

 

 

 

 

 

 

 

 

 

Recognized at a point in time

 

$

1,714

 

 

 

81

%

 

$

947

 

 

 

82

%

Recognized over time

 

 

393

 

 

 

19

%

 

 

201

 

 

 

18

%

Total

 

$

2,107

 

 

 

100

%

 

$

1,148

 

 

 

100

%

For the three months ended March 31, 2024, two customers accounted for 39% and 36% of the Company’s revenue, respectively. For the three months ended March 31, 2023, three customers accounted for 20%, 19% and 17% of the Company’s revenue, respectively.

Contract Assets and Contract Liabilities

As of March 31, 2024, and December 31, 2023, the Company had contract assets of $0.1 million and $0.1 million, respectively, recognized in other current assets. As of March 31, 2024, and December 31, 2023, the Company had contract liabilities of $3.6 million and $2.1 million, respectively, recognized in other current liabilities.

 

10


 

 

 

 

 

Note 3. Financial Instruments

 

The following tables summarize the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy:

 

 

 

March 31, 2024

 

 

 

Adjusted Cost

 

 

Unrealized Gains

 

 

Unrealized Losses

 

 

Fair Value

 

 

Cash and Cash Equivalent

 

 

Marketable Securities

 

 

 

(in thousands)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

$

17,668

 

 

$

 

 

$

 

 

$

17,668

 

 

$

17,668

 

 

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

 

264

 

 

 

 

 

 

 

 

 

264

 

 

 

264

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. agency securities

 

 

27,635

 

 

 

2

 

 

 

(76

)

 

 

27,561

 

 

 

 

 

 

27,561

 

U.S. Treasury securities

 

 

30,255

 

 

 

 

 

 

(41

)

 

 

30,214

 

 

 

11,673

 

 

 

18,541

 

Commercial paper

 

 

42,591

 

 

 

6

 

 

 

(45

)

 

 

42,552

 

 

 

 

 

 

42,552

 

Corporate bonds

 

 

71,163

 

 

 

20

 

 

 

(114

)

 

 

71,069

 

 

 

 

 

 

71,069

 

Subtotal

 

 

171,644

 

 

 

28

 

 

 

(276

)

 

 

171,396

 

 

 

11,673

 

 

 

159,723

 

Total assets

 

$

189,576

 

 

$

28

 

 

$

(276

)

 

$

189,328

 

 

$

29,605

 

 

$

159,723

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Warrant liabilities

 

 

7,209

 

 

 

 

 

 

 

 

 

7,209

 

 

 

 

 

 

 

Total liabilities

 

$

7,209

 

 

$

 

 

$

 

 

$

7,209

 

 

$

 

 

$

 

 

 

 

 

December 31, 2023

 

 

 

Adjusted Cost

 

 

Unrealized Gain

 

 

Unrealized Losses

 

 

Fair Value

 

 

Cash and Cash Equivalent

 

 

Marketable Securities

 

 

 

(in thousands)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

$

21,799

 

 

$

 

 

$

 

 

$

21,799

 

 

$

21,799

 

 

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

 

6,266

 

 

 

 

 

 

 

 

 

6,266

 

 

 

6,266

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government securities

 

 

35,962

 

 

 

8

 

 

 

(97

)

 

 

35,873

 

 

 

 

 

 

35,873

 

U.S. Treasury securities

 

 

18,323

 

 

 

1

 

 

 

(14

)

 

 

18,310

 

 

 

10,482

 

 

 

7,828

 

Commercial paper

 

 

38,491

 

 

 

25

 

 

 

(16

)

 

 

38,500

 

 

 

 

 

 

38,500

 

Corporate bonds

 

 

100,274

 

 

 

136

 

 

 

(130

)

 

 

100,280

 

 

 

 

 

 

100,280

 

Subtotal

 

 

193,050

 

 

 

170

 

 

 

(257

)

 

 

192,963

 

 

 

10,482

 

 

 

182,481

 

Total assets

 

$

221,115

 

 

$

170

 

 

$

(257

)

 

$

221,028

 

 

$

38,547

 

 

$

182,481

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Warrant liabilities

 

 

6,772

 

 

 

 

 

 

 

 

 

6,772

 

 

 

 

 

 

 

Total liabilities

 

$

6,772

 

 

$

 

 

$

 

 

$

6,772

 

 

$

 

 

$

 

 

The fair value of the private placement and Series A warrant liabilities is based on significant unobservable inputs, which represent Level 3 measurements within the fair value hierarchy. In determining the fair value of the warrant liabilities, the Company used the Black-Scholes option-pricing model to estimate the fair value using unobservable inputs including the expected term, expected volatility, risk-free interest rate, and dividend yield.

11


 

The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments (in thousand):

 

 

 

 

 

 

 

 

 

 

March 31, 2024

 

 

December 31, 2023

 

Fair value, beginning balance

 

$

6,772

 

 

$

90

 

Fair value at issuance of Series A warrants

 

 

 

 

$

6,450

 

Change in the fair value of Series A warrants included in other income (expense), net

 

 

450

 

 

$

300

 

Change in the fair value of private placement warrants included in other income (expense), net

 

 

(13

)

 

 

(68

)

Fair value, closing balance

 

$

7,209

 

 

$

6,772

 

 

The key inputs into the Black-Scholes option pricing model for the private warrants were as follows for the relevant periods:

 

 

 

March 31, 2024

 

 

December 31, 2023

 

Expected term (years)

 

 

2.0

 

 

 

2.2

 

Expected volatility

 

 

90.3

%

 

 

94.1

%

Risk-free interest rate

 

 

5.03

%

 

 

4.23

%

Dividend yield

 

 

0

%

 

 

0

%

Exercise Price

 

$

57.50

 

 

$

57.50

 

 

The key inputs into the Black-Scholes option pricing model for the Series A warrants were as follows for the relevant periods:

 

 

 

March 31, 2024

 

 

December 31, 2023

 

Expected term (years)

 

 

3.7

 

 

 

4.0

 

Expected volatility

 

 

92.1

%

 

 

87.2

%

Risk-free interest rate

 

 

4.29

%

 

 

3.89

%

Dividend yield

 

 

0

%

 

 

0

%

Exercise Price

 

$

5.00

 

 

$

5.00

 

 

 

Note 4. Acquisition of Intangible Assets

 

As of March 31, 2024, expected amortization expense relating to purchased intangible assets was as follows (in thousands):

 

Remainder of 2024

 

$

675

 

2025

 

 

900

 

2026

 

 

825

 

Total future amortization

 

$

2,400

 

 

The Company recorded amortization expense related to the acquired intangible assets of $0.2 million each for the three months ended March 31, 2024 and March 31, 2023, respectively.

 

Note 5. Inventories

Inventories consisted of the following (in thousands):

 

 

 

March 31,

 

 

December 31,

 

 

 

2024

 

 

2023

 

Raw materials

 

$

1,583

 

 

$

2,178

 

Work-in-progress

 

 

60

 

 

 

136

 

Finished goods

 

 

520

 

 

 

60

 

Total inventories

 

$

2,163

 

 

$

2,374

 

 

12


Note 6. Property, Plant and Equipment

Property, plant and equipment consisted of the following (in thousands):

 

 

 

March 31,

 

 

December 31,

 

 

 

2024

 

 

2023

 

Computer equipment

 

$

2,944

 

 

$

2,795

 

Lab equipment

 

 

7,255

 

 

 

7,151

 

Leasehold improvements

 

 

3,312

 

 

 

3,148

 

Construction in progress

 

 

700

 

 

 

1,434

 

Testing equipment

 

 

1,75