What changed in this filing

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Item 1. Financial Statements

2022-11-08 compared with 2022-08-09 · 118 added, 112 removed, 515 unchanged (31% of the section changed)

3 unchanged sentences

(Unaudited, in thousands, except par value)

September 30,

Current assets:

1 unchanged sentence

Restricted cash

Accounts receivable, net of allowances of $ 2,669 and $ 2,745 as of June 30, 2022

Accounts receivable, net of allowances of $ 2,666 and $ 2,745 as of September 30, 2022

and December 31, 2021, respectively

20 unchanged sentences

10,000 shares authorized;

issued and outstanding as of June 30, 2022 and December 31, 2021

issued and outstanding as of September 30, 2022 and December 31, 2021

Common stock, $ 0.001 par value:

1 unchanged sentence

24,021 and 23,707 shares

issued and 22,444 and 22,230 shares outstanding as of June 30, 2022 and

issued and 22,490 and 22,230 shares outstanding as of September 30, 2022 and

December 31, 2021, respectively

Additional paid-in capital

Treasury stock, 1,511 and 1,477 shares as of June 30, 2022 and December 31, 2021,

Treasury stock, 1,531 and 1,477 shares as of September 30, 2022 and December 31, 2021,

Accumulated deficit

6 unchanged sentences

(Unaudited, in thousands, except per share data)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Cost of revenue

5 unchanged sentences

Total operating expenses

Loss from operations

Income (loss) from operations

Non-operating income (expense):

2 unchanged sentences

Gain on investment

Foreign currency gains, net

Income (loss) before income tax provision

Income tax provision

Foreign currency gains (losses), net

Income (loss) before income tax benefit (provision)

Income tax benefit (provision)

Net income (loss)

9 unchanged sentences

(Unaudited, in thousands)

Three Months Ended June 30, 2022

Three Months Ended September 30, 2022

Convertible Preferred Stock

1 unchanged sentence

Stockholders'

Balances, March 31, 2022

Balances, June 30, 2022

Unrealized loss from foreign

6 unchanged sentences

restricted stock units

Balances, June 30, 2022

Six Months Ended June 30, 2022

Balances, September 30, 2022

Nine Months Ended September 30, 2022

Convertible Preferred Stock

10 unchanged sentences

restricted stock units

Balances, June 30, 2022

Three Months Ended June 30, 2021

Balances, September 30, 2022

Three Months Ended September 30, 2021

Convertible Preferred Stock

1 unchanged sentence

Stockholders'

Balances, March 31, 2021

Balances, June 30, 2021

Unrealized income from foreign

6 unchanged sentences

restricted stock units

Issuance of common stock in connection with public offering

Proceeds from exercise of

stock options

Balances, June 30, 2021

Six Months Ended June 30, 2021

Balances, September 30, 2021

Nine Months Ended September 30, 2021

Convertible Preferred Stock

11 unchanged sentences

Issuance of common stock in connection with warrant

Issuance of common stock in connection with public offering

Issuance of common stock in connection with public

Proceeds from exercise of

stock options

Balances, June 30, 2021

Balances, September 30, 2021

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(Unaudited, in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows used in operating activities

Net income (loss)

Adjustments to reconcile net income (loss) to net cash used in

Adjustments to reconcile net income (loss) to net cash provided by (used in)

operating activities:

13 unchanged sentences

Accrued expenses and other liabilities

Net cash used in operating activities

Net cash provided by (used in) operating activities

Cash flows from investing activities:

20 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022

September 30, 2022

Basis of Presentation

8 unchanged sentences

In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the Company’s unaudited condensed consolidated financial statements have been included.

The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or any future period.

The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or any future period.

The unaudited condensed consolidated balance sheet as of December 31, 2021 has been derived from audited consolidated financial statements at that date, but does not include all disclosures required by U.S.

90 unchanged sentences

Total net revenue based on the disaggregation criteria described above is as follows (in thousands):

Three Months Ended June 30,

Three Months Ended September 30,

Europe and the Middle East

Six Months Ended June 30,

Nine Months Ended September 30,

Europe and the Middle East

5 unchanged sentences

The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company’s products and services, not to receive financing from its customers.

Changes in deferred revenue during the six months ended June 30, 2022 and June 30, 2021 were as follows (in thousands):

Six Months Ended June 30,

Changes in deferred revenue during the nine months ended September 30, 2022 and 2021 were as follows (in thousands):

Nine Months Ended September 30,

Deferred revenue, beginning of period

3 unchanged sentences

Unsatisfied Performance Obligations

Revenue expected to be recognized in future periods related to remaining performance obligations, excluding revenue pertaining to contracts that have an original expected duration of one year or less, and contracts where revenue is recognized as invoiced, was approximately $ 0.7 million as of June 30, 2022.

Since the Company typically invoices customers at contract inception, this amount is included in the deferred revenue balance.

As of June 30, 2022, the Company expects to recognize 24 % of the revenue related to these unsatisfied performance obligations during the remainder of 2022, 33 % during 2023, and 43 % thereafter.

As of September 30, 2022, the Company expects to recognize 12 % of the revenue related to these unsatisfied performance obligations during the remainder of 2022, 37 % during 2023, and 51 % thereafter.

Fair Value Measurements

6 unchanged sentences

Assets and Liabilities Measured at Fair Value on a Recurring Basis

As of June 30, 2022 and December 31, 2021, the only assets measured and recognized at fair value on a recurring basis were nominal cash equivalents.

As of June 30, 2022 and December 31, 2021, there were no liabilities measured and recognized at fair value on a recurring basis.

As of September 30, 2022 and December 31, 2021, the only assets measured and recognized at fair value on a recurring basis were nominal cash equivalents.

As of September 30, 2022 and December 31, 2021, there were no liabilities measured and recognized at fair value on a recurring basis.

Assets and Liabilities Measured at Fair Value on a Non-recurring Basis

2 unchanged sentences

For additional discussion of measurement criteria used in evaluating potential impairment involving goodwill and intangible assets, refer to Note 5, Goodwill and Intangible Assets .

As of June 30, 2022 and December 31, 2021, the Company had $ 348,000 of privately-held investments measured at fair value on a nonrecurring basis, which were classified as Level 3 assets due to the absence of quoted market prices and inherent lack of liquidity.

As of September 30, 2022 and December 31, 2021, the Company had $ 348,000 of privately-held investments measured at fair value on a nonrecurring basis, which were classified as Level 3 assets due to the absence of quoted market prices and inherent lack of liquidity.

The Company reviews its investments to identify and evaluate investments that have an indication of possible impairment.

1 unchanged sentence

The amount of privately-held investments is included in other assets in the accompanying condensed consolidated balance sheets.

As of June 30, 2022 and December 31, 2021, there were no liabilities that are measured and recognized at fair value on a non-recurring basis.

As of September 30, 2022 and December 31, 2021, there were no liabilities that are measured and recognized at fair value on a non-recurring basis.

Assets and Liabilities Not Measured at Fair Value

4 unchanged sentences

Currency translation adjustment

Balance as of June 30, 2022

Balance as of September 30, 2022

Balance as of December 31, 2020

8 unchanged sentences

If the carrying amount of the reporting unit is in excess of its fair value, an impairment loss would be recorded in the condensed consolidated statement of comprehensive income (loss).

During the six months ended June 30, 2022 and 2021, the Company noted no indicators of goodwill impairment and concluded no further testing was necessary.

During the nine months ended September 30, 2022 and 2021, the Company noted no indicators of goodwill impairment and concluded no further testing was necessary.

Intangible Assets

2 unchanged sentences

Amortization period (in years)

Gross carrying amount as of June 30, 2022

Gross carrying amount as of September 30, 2022

Accumulated amortization

Intangible assets, net as of June 30, 2022

Intangible assets, net as of September 30, 2022

Gross carrying amount as of December 31, 2021

5 unchanged sentences

The Company performs an evaluation of its amortizable intangible assets for impairment at the end of each reporting period.

The Company did no t identify any impairment indicators during the six months ended June 30, 2022 and 2021.

The following table summarizes the amortization expense included in the condensed consolidated statements of comprehensive income (loss) for the three and six months ended June 30, 2022 and 2021, respectively (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

The Company did no t identify any impairment indicators during the nine months ended September 30, 2022 and 2021.

The following table summarizes the amortization expense included in the condensed consolidated statements of comprehensive income (loss) for the three and nine months ended September 30, 2022 and 2021 (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Cost of revenue

Selling and marketing

The estimated annual future amortization expense for purchased intangible assets with definite lives as of June 30, 2022 was as follows (in thousands):

2022 (remaining six months)

The estimated annual future amortization expense for purchased intangible assets with definite lives as of September 30, 2022 was as follows (in thousands):

2022 (remaining three months)

Balance Sheet Components

1 unchanged sentence

Inventories consists of (in thousands):

September 30,

Raw materials

2 unchanged sentences

Property and equipment, net consists of (in thousands):

September 30,

Building and leasehold improvements

4 unchanged sentences

Property and equipment, net

The Company recorded depreciation expenses of $ 0.3 million and $ 0.2 million during the three months ended June 30, 2022 and 2021 , respectively, and $ 0.5 million and $ 0.4 million during the six months ended June 30, 2022 and 2021, respectively .

The Company recorded depreciation expenses of $ 0.3 million and $ 0.2 million during the three months ended September 30, 2022 and 2021 , respectively, and $ 0.8 million and $ 0.6 million during the nine months ended September 30, 2022 and 2021, respectively .

Other accrued expenses and liabilities consist of (in thousands):

September 30,

Accrued professional fees

11 unchanged sentences

The non-formula revolving loan facility terminated on February 7, 2022 .

On April 14, 2022, the Company and EWB amended the Loan and Security Agreement replacing the $ 20.0 million revolving loan facility subject to a borrowing base with a non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023 .

On April 14, 2022, the Company and EWB amended the Loan and Security Agreement replacing the $ 20.0 million revolving loan facility subject to a borrowing base with a $ 20.0 million non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023 .

In addition, the interest rate was lowered from prime to prime minus 0.25 %, and certain financial covenants were amended.

1 unchanged sentence

The Company’s obligations under the Loan and Security Agreement are collateralized by substantially all of its assets.

As of June 30, 2022, there were no amounts outstanding and the Company was in compliance with all financial covenants under the Loan and Security Agreement.

As of September 30, 2022, there were no amounts outstanding and the Company was in compliance with all financial covenants under the Loan and Security Agreement.

The Company conducts business globally and, as a result, files federal, state and foreign tax returns.

13 unchanged sentences

The Act and the CARES Act had no material impact on the Company’s condensed consolidated financial statements and disclosures.

The Inflation Reduction Act (the “IRA”) was signed into the law on August 16, 2022.

The IRA provides for a minimum tax on certain corporations having more than $ 1 billion in revenue, excise taxes on share buybacks and changes to various types of tax credits.

The Company believes the IRA will have little to no effect on the Company’s income taxes.

The Company will continue to assess as the provisions are clarified.

Stockholders’ Equity

Series B Convertible Preferred Stock Dividend Accretion

The following table summarizes Series B convertible preferred stock and the accretion of dividend activity for the three and six months ended June 30, 2022 and 2021 (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

The following table summarizes Series B convertible preferred stock and the accretion of dividend activity for the three and nine months ended September 30, 2022 and 2021 (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Series B Convertible Preferred Stock:

6 unchanged sentences

Number of shares at end of period

Based on the current conversion price, the outstanding shares, including the accretion of dividends, of Series B convertible preferred stock as of June 30, 2022 would be convertible into 6,178,823 shares of the Company’s common stock.

Based on the current conversion price, the outstanding shares, including the accretion of dividends, of Series B convertible preferred stock as of September 30, 2022 would be convertible into 6,254,793 shares of the Company’s common stock.

However, the conversion rate will be subject to adjustment in certain instances, such as if the Company issues shares of its common stock at a price less than $ 4.00 per common share, subject to a minimum conversion price of $ 3.27 per share.

As of June 30, 2022, none of the contingent conditions to adjust the conversion rate had been met.

As of September 30, 2022, none of the contingent conditions to adjust the conversion rate had been met.

Each share of Series B convertible preferred stock is entitled to a cumulative annual dividend of 5 % for the first six years following the issuance of such share and 3 % for each year thereafter, with the Company retaining the option to settle each year’s dividend after the 10th year in cash.

1 unchanged sentence

In general, the shares are not entitled to vote except in certain limited cases, including in change of control transactions where the expected price per share distributable to the Company’s stockholders is expected to be less than $ 4.00 per share.

The Certificate of Designation with respect to the Series B convertible preferred stock further provides that in the event of, among other things, any change of control, liquidation or dissolution of the Company, the holders of the Series B convertible preferred stock will be entitled to receive, on a pari passu basis with the holders of the common stock, the same amount and form of consideration that the holders of the Company’s common stock receive (on an as-if-converted-to-common-stock basis and without regard to the Ownership Limitation applicable to the Series B convertible preferred stock).

The Certificate of Designation with respect to the Series B convertible preferred stock further provides that in the event of, among other things, any change of control, liquidation or dissolution of the Company, the holders of the Series B convertible preferred stock will be entitled to receive, on a pari passu basis with the holders of the common stock, the same amount and form of consideration that the holders of the Company’s common stock receive (on an as-if-converted-to-common-stock basis and without regard to the Beneficial Ownership Limitation (as defined in the Certificate of Designation) applicable to the Series B convertible preferred stock).

Common Stock Warrants

2 unchanged sentences

The shares of common stock issuable upon exercise of the April 21 Fund Warrants are entitled to resale registration rights pursuant to a Stockholders Agreement dated December 21, 2017.

Below is the summary of outstanding warrants issued by the Company as of June 30, 2022:

Below is the summary of outstanding warrants as of September 30, 2022:

Number of Shares

4 unchanged sentences

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance as of June 30, 2022 was as follows:

Common stock reserved for future issuance as of September 30, 2022 was as follows:

Exercise of outstanding stock options, vesting of restricted stock units ("RSUs"), vesting of

8 unchanged sentences

Stock Options

A summary of stock option activity for the six months ended June 30, 2022 is as follows:

A summary of stock option activity for the nine months ended September 30, 2022 is as follows:

Weighted Average Exercise

4 unchanged sentences

Cancelled or Expired

Balance as of June 30, 2022

Vested or expected to vest as of June 30, 2022

Exercisable as of June 30, 2022

The aggregate intrinsic value in the table above represents the difference between the fair value of the Company’s common stock as of June 30, 2022 and the exercise price of in-the-money stock options multiplied by the number of such stock options.

The following table summarizes information about stock options outstanding as of June 30, 2022:

Balance as of September 30, 2022

Vested or expected to vest as of September 30, 2022

Exercisable as of September 30, 2022

The aggregate intrinsic value in the table above represents the difference between the fair value of the Company’s common stock as of September 30, 2022 and the exercise price of in-the-money stock options multiplied by the number of such stock options.

The following table summarizes information about stock options outstanding as of September 30, 2022:

Stock Options Outstanding

7 unchanged sentences

$4.36 - $29.55

As of June 30, 2022, there was no unrecognized stock-based compensation expense related to stock options .

As of September 30, 2022, there was no unrecognized stock-based compensation expense related to stock options .

Restricted Stock Units

The following is a summary of RSU activity for the six months ended June 30, 2022:

The following is a summary of RSU activity for the nine months ended September 30, 2022:

Weighted Average

Unvested as of December 31, 2021

Unvested as of June 30, 2022

Unvested as of September 30, 2022

RSUs vested but not released

The fair value of the Company’s RSUs is calculated based upon the fair market value of the Company’s common stock at the date of grant.

As of June 30, 2022, there was $ 5.6 million of unrecognized compensation expense related to unvested RSUs granted, which is expected to be recognized over a weighted average period of 3.0 years.

No tax benefit was realized from RSUs for the six months ended June 30, 2022.

As of September 30, 2022, there was $ 5.6 million of unrecognized compensation expense related to unvested RSUs granted, which is expected to be recognized over a weighted average period of 2.9 years.

No tax benefit was realized from RSUs for the nine months ended September 30, 2022.

Performance Stock Units

3 unchanged sentences

If the employee terminates employment, the non-vested portion of the PSUs will not vest and all rights to the non-vested portion will terminate.

The following is a summary of PSU activity for the six months ended June 30, 2022:

The following is a summary of PSU activity for the nine months ended September 30, 2022:

Unvested as of December 31, 2021

Unvested as of June 30, 2022

As of June 30, 2022, there was $ 0.2 million of unrecognized compensation expense related to unvested PSUs, which is expected to be recognized over a period of 0 .5 years .

No tax benefit was realized from PSUs for the six months ended June 30, 2022.

Unvested as of September 30, 2022

As of September 30, 2022, there was $ 0.1 million of unrecognized compensation expense related to unvested PSUs, which is expected to be recognized over a period of 0 .3 years .

No tax benefit was realized from PSUs for the nine months ended September 30, 2022.

Stock-Based Compensation Expense

The following table summarizes stock-based compensation expense related to stock options, RSUs, and PSUs included in the condensed consolidated statements of comprehensive income (loss) for the three and six months ended June 30, 2022 and 2021 (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

The following table summarizes stock-based compensation expense related to stock options, RSUs, and PSUs included in the condensed consolidated statements of comprehensive income (loss) for the three and nine months ended September 30, 2022 and 2021 (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Cost of revenue

3 unchanged sentences

Restricted Stock Unit Net Share Settlements

During the six months ended June 30, 2022 and 2021, the Company repurchased 34,111 and 48,590 shares, respectively, of common stock surrendered to the Company to satisfy tax withholding obligations in connection with the vesting of RSUs issued to employees.

During the nine months ended September 30, 2022 and 2021, the Company repurchased 54,074 and 68,519 shares, respectively, of common stock surrendered to the Company to satisfy tax withholding obligations in connection with the vesting of RSUs issued to employees.

Net Income (Loss) per Common Share

1 unchanged sentence

Diluted net income (loss) per common share is impacted by equity instruments considered to be potential common shares, if dilutive, computed using the treasury stock or the if-converted method of accounting.

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Basic net income (loss) per common share:

6 unchanged sentences

Net income (loss) available to common stockholders

accretion of Series B convertible preferred stock dividends, if dilutive

accretion of Series B convertible preferred stock dividends,

Net income (loss) available to common stockholders

5 unchanged sentences

Net income (loss) per common share - diluted

The following common stock equivalents have been excluded from diluted net income (loss) per share for the three and six months ended June 30, 2022 and 2021 because their inclusion would have been anti-dilutive (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

The following common stock equivalents have been excluded from diluted net income (loss) per share for the three and nine months ended September 30, 2022 and 2021 because their inclusion would have been anti-dilutive (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Shares of common stock subject to outstanding RSUs

13 unchanged sentences

The Company does not report total assets, capital expenditures or operating expenses by operating segment as such information is not used by the CODM for purposes of assessing performance or allocating resources.

Net revenue and gross profit information by segment for the three and six months ended June 30, 2022 and 2021 are as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Net revenue and gross profit information by segment for the three and nine months ended September 30, 2022 and 2021 are as follows (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Gross profit margin

7 unchanged sentences

Total operating expenses:

Loss from operations

Income (loss) from operations

Non-operating income (expense):

2 unchanged sentences

Gain on investment

Foreign currency gains, net

Income (loss) before income tax provision

Foreign currency gains (losses), net

Income (loss) before income tax benefit (provision)

Geographic Information

Geographic net revenue is based on the customer’s ship-to location.

Information regarding net revenue by geographic region for the three and six months ended June 30, 2022 and 2021 is as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Information regarding net revenue by geographic region for the three and nine months ended September 30, 2022 and 2021 is as follows (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Europe and the Middle East

2 unchanged sentences

Concentration of Credit Risk

No customer accounted for 10% or more of net revenue for either of the three or six months ended June 30, 2022 or 2021.

No customer accounted for 10% or more of net accounts receivable as of June 30, 2022 or December 31, 2021.

Long-lived assets by geographic location as of June 30, 2022 and December 31, 2021 are as follows (in thousands):

No customer accounted for 10% or more of net revenue for either of the three or nine months ended September 30, 2022 or 2021.

No customer accounted for 10% or more of net accounts receivable as of September 30, 2022 or December 31, 2021.

Long-lived assets by geographic location as of September 30, 2022 and December 31, 2021 are as follows (in thousands):

September 30,

Property and equipment, net:

5 unchanged sentences

Restructuring and Severance

During the three and six months ended June 30, 2022, restructuring expenses consisted of severance related costs of $ 221,000 and $ 234,000 , respectively.

During the three and nine months ended September 30, 2022, restructuring expenses consisted of severance related costs of $ 49,000 and $ 283,000 , respectively.

In the first quarter of 2022, the Company entered into a settlement agreement associated with outstanding rental payments due the landlord on leased office space in San Francisco, California.

As a result of the settlement, the Company recorded a net credit of $ 151,000 representing the difference between amounts accrued and the settlement amount.

Restructuring expenses incurred during the three and six months ended June 30, 2021 of $ 274,000 and $ 662,000 , respectively, consists of facility rental related costs of $ 127,000 and $ 456,000 , respectively, and severance related costs of $ 147,000 and $ 206,000 , respectively.

Facility rental related costs during the six months ended June 30, 2021 included a charge of $ 281,000 resulting from the impairment of a right-of-use operating lease asset for office space the Company vacated in the first quarter of 2021 .

Restructuring expenses incurred during the three and nine months ended September 30, 2021 of $ 99,000 and $ 761,000 , respectively, consists of facility rental related costs of $ 67,000 and $ 523,000 , respectively, and severance related costs of $ 32,000 and $ 238,000 , respectively.

Facility rental related costs during the nine months ended September 30, 2021 included a charge of $ 281,000 resulting from the impairment of a right-of-use operating lease asset for office space the Company vacated in the first quarter of 2021.

The Company’s leases consist primarily of operating leases for administrative office space, research and development facilities, a manufacturing facility, and sales offices in various countries around the world.

1 unchanged sentence

Some lease agreements contain lease and non-lease components, which are accounted for as a single lease component.

Total rent expense was $ 0.3 million and $ 0.6 million for the three and six months ended June 30, 2022, respectively, and $ 0.3 million and $ 0.6 million for the three and six months ended June 30, 2021, respectively.

Total rent expense was $ 0.4 million and $ 1.0 million for the three and nine months ended September 30, 2022, respectively, and $ 0.3 million and $ 1.0 million for the three and nine months ended September 30, 2021, respectively.

Initial lease terms are determined at commencement and may include options to extend or terminate the lease when it is reasonably certain the Company will exercise the option.

Remaining lease terms range from one to four years , some of which include options to extend for up to five years .

Remaining lease terms range from one to five years , some of which include options to extend for up to five years .

Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets.

As the Company’s leases do not provide an implicit rate, the present value of future lease payments is determined using the Company’s incremental borrowing rate based on information available at the lease commencement date.

The table below reconciles the undiscounted cash flows for the first five years and the total of the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of June 30, 2022 (in thousands):

2022 (remaining six months)

September 30,

2022 (remaining three months)

Total minimum lease payments

3 unchanged sentences

Long-term operating lease liabilities

As of June 30, 2022, the weighted average remaining lease term for the Company’s operating leases was 2.4 years, and the weighted average discount rate used to determine the present value of the Company’s operating leases was 6.3 %.

Cash paid for amounts included in the measurement of operating lease liabilities was $ 0.4 million and $ 0.7 million for the three and six months ended June 30, 2022, respectively.

As of September 30, 2022, the weighted average remaining lease term for the Company’s operating leases was 3.0 years, and the weighted average discount rate used to determine the present value of the Company’s operating leases was 6.3 %.

Cash paid for amounts included in the measurement of operating lease liabilities was $ 0.3 million and $ 1.0 million for the three and nine months ended September 30, 2022, respectively.

Commitments and Contingencies

The following table summarizes the Company’s principal contractual commitments, excluding operating leases, as of June 30, 2022 (in thousands):

2022 (remaining six months)

The following table summarizes the Company’s principal contractual commitments, excluding operating leases, as of September 30, 2022 (in thousands):

2022 (remaining three months)

Purchase commitments for inventories are highly dependent upon forecasts of customer demand.

1 unchanged sentence

These changes may lead to vendor cancellation charges on these purchases or contractual commitments.

The following table summarizes the Company’s warranty accrual account activity during the three and six months ended June 30, 2022 and 2021:

Three Months Ended June 30,

Six Months Ended June 30,

The following table summarizes the Company’s warranty accrual account activity during the three and nine months ended September 30, 2022 and 2021:

Three Months Ended September 30,

Nine Months Ended September 30,

Balance at beginning of period

7 unchanged sentences

Historically, the warranty accrual and the expense amounts have been immaterial.

Subsequent Event

In July 2022, the Company and its landlord amended the lease agreement at its Santa Ana, California facility by extending the term through January 31, 2028.

As the Company will account for the lease amendment as a modification of the original lease, in the third quarter of 2022, the Company will reassess the lease classification, remeasure the lease liability, and adjust the right-of-use lease asset.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements