What changed in this filing

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Item 1. Financial Statements

2025-11-07 compared with 2025-08-08 · 276 added, 292 removed, 714 unchanged (44% of the section changed)

2 unchanged sentences

(In thousands, except share amounts and par value data)

June 30, 2025

September 30, 2025

December 31, 2024

20 unchanged sentences

Total current liabilities

10,587 11,307

Operating lease liabilities, noncurrent

2 unchanged sentences

Total liabilities

11,920 11,996

COMMITMENTS AND CONTINGENCIES (Note 17)

5 unchanged sentences

600,000,000 shares authorized;

20,550,266 and 13,734,160 shares issued and outstanding at June 30, 2025 and December 31, 2024

41,776,670 and 13,734,160 shares issued and outstanding at September 30, 2025 and December 31, 2024

Additional paid-in capital

477,903 388,213

Accumulated other comprehensive income

Accumulated other comprehensive income (loss)

Accumulated deficit

7 unchanged sentences

(In thousands, except share amounts and per share data)

Three months ended June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

$ 50 $ 104 $ 136 $ 156

22 unchanged sentences

( 1,505 ) ( 860 ) ( 3,284 ) ( 77 )

Loss before income tax expense

Loss before income tax

( 9,330 ) ( 8,706 ) ( 26,614 ) ( 26,910 )

Provision for income tax expense

Provision for income tax

$ ( 9,330 ) $ ( 8,706 ) $ ( 26,616 ) $ ( 26,912 )

4 unchanged sentences

PER SHARE DATA

Net loss per share (basic and diluted)

Net loss per common share (basic and diluted)

$ ( 0.30 ) $ ( 1.01 ) $ ( 1.34 ) $ ( 3.90 )

Weighted average shares outstanding (basic and diluted)

Weighted average common shares outstanding (basic and diluted)

31,262,997 8,629,683 19,880,145 6,892,910

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS ’ EQUITY

For the six months ended June 30, 2025 and 2024

For the nine months ended September 30, 2025 and 2024

(In thousands, except share amounts)

40 unchanged sentences

— $ — 20,550,266 $ 2 $ 400,561 $ — $ ( 390,381 ) $ 10,182

Stock-based compensation

— — — — 1,071 — — 1,071

Issuance of common stock upon vesting of restricted stock units

— — 141,618 — — — — —

Taxes related to net share settlement of equity awards

— — ( 53,024 ) — ( 135 ) — — ( 135 )

Issuance of common stock under Common Stock Purchase Agreements

— — 19,160,596 2 70,910 — — 70,912

Transaction costs related to the Common Stock Purchase Agreements

— — — — ( 989 ) — — ( 989 )

Conversions of convertible note into common stock

— — 1,171,951 — 1,769 — — 1,769

Issuance of common stock through exercise of convertible note warrant

— — 805,263 — 4,716 — — 4,716

Other comprehensive loss, net of tax

— — — — — ( 4 ) — ( 4 )

— — — — — — ( 9,330 ) ( 9,330 )

BALANCE—September 30, 2025

— $ — 41,776,670 $ 4 $ 477,903 $ ( 4 ) $ ( 399,711 ) $ 78,192

Accumulated Other

4 unchanged sentences

BALANCE—December 31, 2023

— $ — 6,310,090 $ 1 $ 366,647 $ 10 $ ( 337,635 ) $ 29,023

Stock-based compensation

— — — — 3,014 — — 3,014

Issuance of common stock upon vesting of restricted stock units

— — 98,623 — — — — —

Taxes related to net share settlement of equity awards

— — ( 34,694 ) — ( 45 ) — — ( 45 )

Issuance of common stock under the Common Stock Purchase Agreement

— — 129,000 — 165 — — 165

Other comprehensive loss, net of tax

— — — — — ( 14 ) — ( 14 )

— — — — — — ( 10,219 ) ( 10,219 )

BALANCE—March 31, 2024

— — 6,503,019 1 369,781 ( 4 ) ( 347,854 ) 21,924

Stock-based compensation

— — — — 1,740 — — 1,740

Issuance of common stock upon exercise of stock options

— — 44,255 — 134 — — 134

Issuance of common stock upon vesting of restricted stock units

— — 167,143 — — — — —

Taxes related to net share settlement of equity awards

— — ( 1,292 ) — ( 2 ) — — ( 2 )

Issuance of common stock under the Common Stock Purchase Agreements

— — 1,693,929 — 5,395 — — 5,395

Stock issuance costs related to Common Stock Purchase Agreements

— — — — ( 416 ) — — ( 416 )

Issuance of common stock through Employee Stock Purchase Plan

— — 30,679 — 26 — — 26

Other comprehensive loss, net of tax

— — — — — ( 4 ) — ( 4 )

— — — — — — ( 7,987 ) ( 7,987 )

BALANCE—June 30, 2024

— $ — 8,437,733 $ 1 $ 376,658 $ ( 8 ) $ ( 355,841 ) $ 20,810

Stock-based compensation

Issuance of common stock upon vesting of restricted stock units

Taxes related to net share settlement of equity awards

Issuance of common stock under the Common Stock Purchase Agreement

Other comprehensive income, net of tax

BALANCE—September 30, 2024

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

1 unchanged sentence

(In thousands)

Six months ended June 30,

Nine months ended September 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

$ ( 17,286 ) $ ( 18,206 )

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

Depreciation and amortization

Gain on sale of property and equipment, net

Noncash lease expense relating to operating lease right-of-use assets

2 unchanged sentences

Debt issuance costs

Gain on extinguishment of warrant

Inventory write-downs, net of scrapped inventory

2 unchanged sentences

Amortization of premiums and accretion of discounts on marketable securities, net of change in accrued interest

( 157 ) ( 428 )

Expected credit losses, net of write-off

6 unchanged sentences

Accrued expenses and other current liabilities

( 1,522 ) ( 1,402 )

Operating lease liabilities

( 1,532 ) ( 799 )

Contract liabilities

1 unchanged sentence

Net cash used in operating activities

( 14,158 ) ( 14,241 )

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment

( 14 ) ( 234 )

Proceeds from sale of property and equipment

Purchases of marketable securities

( 14,303 ) ( 15,173 )

Proceeds from redemptions and maturities of marketable securities

Net cash (used in) provided by investing activities

( 4,686 ) 2,993

CASH FLOWS FROM FINANCING ACTIVITIES:

5 unchanged sentences

Stock issuance costs related to Common Stock Purchase Agreements

( 404 ) ( 288 )

Taxes paid related to the net share settlement of equity awards

( 364 ) ( 47 )

Proceeds from exercise of warrant

Proceeds from issuance of common stock through the Employee Stock Purchase Plan

Net cash provided by financing activities

NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

( 7,892 ) ( 5,717 )

NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

CASH, CASH EQUIVALENTS AND RESTRICTED CASH—Beginning of period

10,266 19,082

CASH, CASH EQUIVALENTS AND RESTRICTED CASH—End of period

$ 2,374 $ 13,365

SUPPLEMENTAL CASH FLOW INFORMATION:

4 unchanged sentences

Stock issuance costs included in accounts payable and accrued liabilities

Debt issuance costs included in accounts payable and accrued liabilities

Purchases of property and equipment included in accounts payable and accrued liabilities

Operating lease liabilities extinguished upon termination of lease

Operating lease right-of-use asset derecognized upon termination of lease

Operating lease right-of-use assets obtained in exchange for lease obligations

Stock issuance costs through issuance of common stock

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

2 unchanged sentences

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

and its wholly owned subsidiaries (the “Company” or “AEye”) is a provider of high-performance, active lidar systems for vehicle autonomy, advanced driver-assistance systems, or ADAS, and robotic vision applications.

AEye’s Intelligent Sensing Platform includes a solid-state software definable active lidar sensor, an adaptive sensing SmartScan architecture to scan dynamic scenes/targets, and sophisticated signal processing capability that provides precise measurements and imaging for various safety-critical applications.

9 unchanged sentences

Unaudited Condensed Consolidated Financial Statements

The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission.

The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission.

Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.

In the opinion of management, all adjustments considered necessary for fair presentation have been included.

The accompanying interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto for the year ended December 31, 2024 included in the Company's Annual Report on Form 10 -K for the year ended December 31, 2024 .

The accompanying interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company's Annual Report on Form 10 -K for the year ended December 31, 2024 .

Reclassification of Prior Period Presentation

Certain prior year amounts have been reclassified for consistency with the current year presentation.

Use of Estimates

6 unchanged sentences

All intercompany balances and transactions have been eliminated in consolidation.

Management is required to assess its ability to continue as a going concern within one year of the date the financial statements are issued in accordance with ASC 205 - 40, Presentation of Financial Statements - Going Concern.

In each reporting period, including interim periods, an entity is required to assess conditions known and reasonably knowable as of the financial statement issuance date to determine whether it is probable an entity will not meet its financial obligations within one year from the financial statement issuance date.

These condensed consolidated financial statements have been prepared on a going concern basis.

As is common in early-stage companies with limited operating histories, the Company is subject to risks and uncertainties such as its ability to develop and commercialize its products;

produce and deliver lidar and software products meeting acceptable performance metrics;

attract new and retain existing customers;

develop, obtain, or progress strategic partnerships;

secure an automotive OEM design win;

secure additional capital to support the business plan;

and other risks and uncertainties.

Since its inception, the Company has incurred net losses and negative cash flows from operations.

As of June 30, 2025 , the Company had an accumulated deficit of $ 390,381 .

As the Company is still in its early stages, management expects to incur additional operating losses and negative operating cash flows as management continues to focus on achieving commercialization of its lidar solutions and execute on its strategic initiatives.

As the Company incurs additional losses in the future, management may need to raise additional capital through issuances of equity and debt.

The Company has funded its operations primarily through the business combination and issuances of stock.

As of June 30, 2025 , the Company's existing sources of liquidity included cash, cash equivalents, and marketable securities of $ 19,210 .

Subsequent to June 30, 2025 , the Company successfully raised additional capital of $ 68,844 through its common stock purchase agreements and an exercise of warrants (see Note 18 ).

As such, management believes that with total cash, cash equivalents and marketable securities at June 30, 2025, together with the additional net proceeds raised subsequent to quarter-end, the Company currently has sufficient financial resources to fund operations and meet its capital requirements and anticipated obligations as they come due in the next twelve months from the date of issuance of these condensed consolidated financial statements.

As such, management has concluded that the conditions and events that previously raised substantial doubt no longer exist.

The Company has funded its operations primarily through the issuances of common stock.

Since its inception, the Company has incurred net losses and negative cash flows from operations and expects to incur additional operating losses and negative operating cash flows as management continues to focus on achieving commercialization of its lidar solutions and execute on its strategic initiatives.

As of September 30, 2025 , the Company’s existing sources of liquidity included cash, cash equivalents, and marketable securities of $ 84,333 .

Management believes that the Company has sufficient financial resources to fund operations and meet its capital requirements and anticipated obligations as they come due in the next twelve months from the date of issuance of these condensed consolidated financial statements.

Emerging Growth Company

15 unchanged sentences

The Company is currently assessing the effect that the updated standard will have on its financial statement disclosures.

In November 2024, the FASB issued ASU 2024 - 03, Disaggregation of Income Statement Expenses , which requires annual and interim disclosure of disaggregated disclosures of certain costs and expenses on the income statement.

In November 2024, FASB issued ASU 2024 - 03, Disaggregation of Income Statement Expenses , which requires annual and interim disclosure of disaggregated disclosures of certain costs and expenses on the income statement.

The standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted.

11 unchanged sentences

The Company’s financial assets and liabilities measured at fair value on a recurring basis and the level of inputs used for such measurements were as follows (in thousands):

Fair Value Measured as of June 30, 2025 Using:

Fair Value Measured as of September 30, 2025 Using:

Adjusted Cost

Unrealized Gains

Unrealized Gains (Losses)

Cash and Cash Equivalent

15 unchanged sentences

Convertible note, current

— — 1,997 — —

Derivative warrant liabilities

27 unchanged sentences

The Company holds financial assets consisting of fixed-income U.S.

government agency securities, corporate bonds, and commercial paper.

government agency securities, corporate bonds, commercial paper, and asset-backed securities.

The securities are valued using prices from independent pricing services based on quoted prices of identical instruments in less active or inactive markets.

24 unchanged sentences

These warrants were exercised in full on July 28, 2025.

In August 2025, in connection with the lease settlement (see Note 5 for details of the settlement), the Company issued warrants, which are recorded on the accompanying condensed consolidated balance sheets at fair value.

The fair value is based on unobservable inputs, which represent Level 3 measurements within the fair value hierarchy.

The fair value estimate of the warrants was based on a Black-Scholes model.

Inherent in a Black-Scholes model are assumptions related to price, volatility, risk-free interest rate, term to expiration, and dividend yield.

Changes in fair value are recognized in other income (expense) for each reporting period.

Derivative Warrant Liability is included within other noncurrent liabilities on the condensed consolidated balance sheets.

Private Placement Warrant Liability :

3 unchanged sentences

Private Placement Warrant liability is included within other noncurrent liabilities on the condensed consolidated balance sheets.

For the six months ended June 30, 2025 , there were no net transfers between Level 1 and Level 2 inputs.

The following table presents a summary of the changes in fair value of the Company’s Level 3 financial instruments for the six months ended June 30, 2025 (in thousands):

For the nine months ended September 30, 2025 , there were no net transfers between Level 1 and Level 2 inputs.

The following table presents a summary of the changes in fair value of the Company’s Level 3 financial instruments for the nine months ended September 30, 2025 (in thousands):

Derivative Warrant Liabilities

2 unchanged sentences

1,945 3,266 5,211

Change in fair value included in other income (expense), net

1,809 314 2,123

Payments and conversions

— ( 3,474 ) ( 3,474 )

Change in fair value included in other income (expense), net

Extinguishment and exercise

( 2,992 ) — ( 2,992 )

Balance at June 30, 2025

Balance at September 30, 2025

$ 788 $ 106 $ 894

The key inputs into the Black-Scholes model for the derivative warrant liability from the 2025 Note valued at June 30, 2025 are as follows:

June 30, 2025

The key inputs into the Black-Scholes model for the derivative warrant liability from the 2025 Note as of the exercise date of July 28, 2025 are as follows:

July 28, 2025

Expected term (years)

3 unchanged sentences

Exercise price

The key inputs into the binomial-lattice model for the 2025 Note valued at June 30, 2025 are as follows:

June 30, 2025

The key inputs into the Black-Scholes model for the derivative warrant issued as a result of the lease settlement valued at September 30, 2025 are as follows:

September 30, 2025

Expected term (years)

2 unchanged sentences

Dividend yield

Estimated credit spread

Exercise price

If factors or assumptions change, the estimated fair values could be materially different.

1 unchanged sentence

Similarly, a higher volatility assumption would increase the value of the liabilities, and a lower volatility assumption would decrease the value of the liabilities.

Inventory, net of write-downs, as of June 30, 2025 and December 31, 2024 were as follows (in thousands):

June 30, 2025

Inventory, net of write-downs, as of September 30, 2025 and December 31, 2024 were as follows (in thousands):

September 30, 2025

December 31, 2024

3 unchanged sentences

Total inventory, net

The Company also had $ 243 and $ 209 of noncurrent inventory (raw materials), net of write-downs, classified within other noncurrent assets on the condensed consolidated balance sheet as of June 30, 2025 and December 31, 2024 , respectively.

The Company’s current and noncurrent inventory as of June 30, 2025 and December 31, 2024 was written down by $ 4,648 and $ 4,659 , respectively, in order to reduce inventory to the lower of cost or net realizable value.

The Company also had $ 0 and $ 209 of noncurrent inventory (raw materials), net of write-downs, classified within other noncurrent assets on the condensed consolidated balance sheet as of September 30, 2025 and December 31, 2024 , respectively.

The Company’s current and noncurrent inventory as of September 30, 2025 and December 31, 2024 was written down by $ 4,607 and $ 4,659 , respectively, in order to reduce inventory to the lower of cost or net realizable value.

PREPAID AND OTHER CURRENT ASSETS

Prepaid and other current assets as of June 30, 2025 and December 31, 2024 were as follows (in thousands):

June 30, 2025

Prepaid and other current assets as of September 30, 2025 and December 31, 2024 were as follows (in thousands):

September 30, 2025

December 31, 2024

3 unchanged sentences

$ 935 $ 2,706

The Company’s advances to suppliers as of June 30, 2025 and December 31, 2024 were written down by $ 1,041 and $ 1,041 , respectively, associated with the winding down of its legacy Non-Automotive product as part of its revised strategic plan.

The Company’s advances to suppliers as of September 30, 2025 and December 31, 2024 had been previously written down by $ 1,041 , respectively, associated with the winding down of its legacy Non-Automotive product as part of its revised strategic plan.

See Note 15, Restructuring, for further details.

9 unchanged sentences

On April 28, 2025, the Company and the former landlord entered into a settlement agreement to resolve all outstanding disputes related to the early termination of the lease.

Under the terms of the agreement, the Company paid $ 1,400 in cash and will issue a warrant to purchase up to 350,000 shares of the Company's common stock at an initial exercise price of $ 2.22 per share with an estimated fair value of $ 301 .

The Company recorded a net gain on termination of operating lease of $ 1,612 during the six months ended June 30, 2025 .

Under the terms of the agreement, the Company paid $ 1,400 in cash and has issued a warrant to purchase up to 350,000 shares of the Company's common stock at an exercise price of $ 2.22 per share with an estimated fair value of $ 899 on the date of issuance.

The Company recorded a net gain on termination of operating lease of $ 1,014 during the nine months ended September 30, 2025.

See Note 17, Commitments and Contingencies, for further discussion.

The components of operating lease expenses, excluding the gain on early termination of operating lease, for the six months ended June 30, 2025 and 2024 , are as follows (in thousands):

Three months ended June 30,

Six months ended June 30,

The components of operating lease expenses, excluding the loss (gain) on early termination of operating lease, for the nine months ended September 30, 2025 and 2024 , are as follows (in thousands):

Three months ended September 30,

Nine months ended September 30,

Operating lease cost

3 unchanged sentences

$ 78 $ 296 $ 227 $ 1,636

Maturities of lease liabilities, excluding the lease termination liability, are as follows (in thousands):

Maturities of lease liabilities are as follows (in thousands):

Operating leases

Years ending - December 31:

2025 (remaining six months)

2025 (remaining three months)

Total lease payments

2 unchanged sentences

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities as of June 30, 2025 and December 31, 2024 are as follows (in thousands):

June 30, 2025

Accrued expenses and other current liabilities as of September 30, 2025 and December 31, 2024 are as follows (in thousands):

September 30, 2025

December 31, 2024

Lease termination liability

$ 301 $ 3,313

Accrued payroll

15 unchanged sentences

The 2025 Note is convertible into Common Stock, at a per share conversion price equal to $ 2.22 , subject to adjustments noted in the 2025 Note.

Monthly redemptions began in April 2025 and are due on the first of each subsequent month (each a "Monthly Redemption Date or an "Installment Date").

The Company shall redeem the Monthly Redemption Amount until the 2025 Note is fully redeemed, payable in cash or, so long as certain equity conditions are met, shares of Common Stock, at the option of the Company.

The equity conditions that must be met in order for the Company to settle the Monthly Redemption Amount in shares include requirements for the daily volume weighted average price of the Company's Common Stock to exceed $ 0.50 and the average daily trading volume of the Company's Common Stock to exceed $ 100 for the twenty ( 20 ) trading days prior to the applicable Installment Notice Date (which is the sixth ( 6th ) trading day prior to each Installment Date).

Monthly redemptions began in April 2025 and were due on the first of each subsequent month (each a "Monthly Redemption Date" or an "Installment Date").

The Company was required to redeem the Monthly Redemption Amount until the 2025 Note was fully redeemed, paid in cash or, so long as certain equity conditions are met, shares of our Common Stock.

The equity conditions that must be met in order for the Company to settle the Monthly Redemption Amount in Common Stock include requirements for the daily volume weighted average price of the Company's Common Stock to exceed $ 0.50 and the average daily trading volume of the Company's Common Stock to exceed $ 100 for the twenty ( 20 ) trading days prior to the applicable Installment Notice Date (which is the sixth ( 6th ) trading day prior to each Installment Date).

The Monthly Redemption Amount, in most instances, will be 1/15th of the original principal amount, plus any amount accelerated pursuant to the 2025 Note, accrued but unpaid interest, and late fees, if any.

15 unchanged sentences

The fair value measurement includes the assumption of accrued interest and expense and thus a separate amount is not reflected on the condensed consolidated statement of operations.

As of June 30, 2025 , the 2025 Note has an outstanding principal balance and accrued interest of $ 1,958 and is recorded as a current liability at fair value of $ 1,997 .

During the nine months ended September 30, 2025 , the Company made cash payments of $ 989 .

Additionally, $ 2,485 in aggregate principal and interest were converted into 2,356,500 shares of common stock.

As of September 30, 2025 , the 2025 Note has an outstanding principal balance and accrued interest of $ 106 and is recorded as a current liability at fair value of $ 106 .

INTEREST EXPENSE AND OTHER

Interest expense and other for the six months ended June 30, 2025 and 2024 consisted of the following (in thousands):

Three months ended June 30,

Six months ended June 30,

Interest expense and other for the nine months ended September 30, 2025 and 2024 consisted of the following (in thousands):

Three months ended September 30,

Nine months ended September 30,

Common stock purchase agreements costs

$ 195 $ — $ 306 $ —

Debt issuance costs

Amortization of premiums (accretion of discounts) on marketable securities, net

( 90 ) ( 170 ) ( 181 ) ( 441 )

Expected credit losses

222 94 326 34

Interest expense and other

$ 365 $ ( 56 ) $ 2,473 $ ( 373 )

STOCKHOLDERS' EQUITY

11 unchanged sentences

The Company determined that the right to sell additional shares represents a freestanding put option under ASC 815, Derivatives and Hedging , and as such, the financial instrument was classified as a derivative asset with a fair value of zero at inception of the CSPA on July 25, 2024 .

The Company has issued 3,480,713 shares of its common stock to New Circle under the CSPA for gross proceeds totaling $ 6,480 through June 30, 2025 .

The Company has issued 8,980,713 shares of its common stock to New Circle under the CSPA for gross proceeds totaling $ 27,754 through September 30, 2025 .

Alliance Global Partners ( “ A.G.P.

1 unchanged sentence

On September 12, 2024 , the Company entered into the ATM and a Registration Rights Agreement with A.G.P.

Under the terms and subject to the conditions of the ATM Agreement, the Company may issue and sell through AGP the Company’s common stock having an aggregate offering price of up to $ 2,600 ("Placement Shares") from time to time through an "at-the-market" equity offering program.

Under the terms and subject to the conditions of the original ATM Agreement, the Company had been allowed to issue and sell through AGP the Company’s common stock having an aggregate offering price of up to $ 2,600 ("Placement Shares") from time to time through an "at-the-market" equity offering program.

In July 2025, the Company increased the amount of the Company's common stock that it may issue and sell through A.G.P.

under the ATM Agreement to a new aggregate value offering of up to $ 75,000 .

The Company has sole discretion to initiate such sales of common stock over a period of 36 months.

1 unchanged sentence

The Company will pay a cash commission rate of up to 3.0 % of the gross proceeds from the sale of Placement Shares sold pursuant to the ATM Agreement.

In January 2025, the Company increased the amount of the Company's common stock that it may issue and sell through A.G.P.

under the ATM Agreement, having a new aggregate value offering of up to $ 15,292 .

The Company has sold 6,395,643 shares under the ATM Agreement for gross proceeds totaling $ 8,825 through June 30, 2025 .

The Company has sold 20,056,239 shares under the ATM Agreement for gross proceeds totaling $ 58,462 through September 30, 2025 .

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in accumulated other comprehensive income (loss) by component for the six months ended June 30, 2025 and 2024 are as follows (in thousands):

Unrealized gains on available-for-sale securities

The changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2025 and 2024 are as follows (in thousands):

Unrealized gains (losses) on available-for-sale securities

Balance at December 31, 2024

Other comprehensive gain, net of tax

Other comprehensive income (loss), net of tax

Balance at March 31, 2025

Other comprehensive loss, net of tax

Other comprehensive income (loss), net of tax

Balance at June 30, 2025

Other comprehensive income (loss), net of tax

Balance at September 30, 2025

Unrealized gains (losses) on available-for-sale securities

Balance at December 31, 2023

Other comprehensive loss, net of tax

Other comprehensive income (loss), net of tax

Balance at March 31, 2024

Other comprehensive income, net of tax

Other comprehensive income (loss), net of tax

Balance at June 30, 2024

Other comprehensive income (loss), net of tax

Balance at September 30, 2024

NET LOSS PER SHARE

The following table sets forth the basic and diluted net loss per share attributable to common stockholders for the periods presented (in thousands, except share amounts and per share data):

Three months ended June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

Net loss attributable to common stockholders

$ ( 9,270 ) $ ( 7,987 ) $ ( 17,286 ) $ ( 18,206 )

Weighted average common shares outstanding - Basic

19,125,970 6,874,454 18,137,050 6,499,089

Weighted average common shares outstanding - Diluted

19,125,970 6,874,454 18,137,050 6,499,089

Net loss per share attributable to common stockholders - Basic and Diluted

$ ( 0.48 ) $ ( 1.16 ) $ ( 0.95 ) $ ( 2.80 )

Due to net losses for the six months ended June 30, 2025 and 2024 , basic and diluted net loss per share were the same, as the effect of all potentially dilutive securities would have been anti-dilutive.

Due to net losses for the nine months ended September 30, 2025 and 2024 , basic and diluted net loss per share were the same, as the effect of all potentially dilutive securities would have been anti-dilutive.

The following table sets forth the anti-dilutive common share equivalents for the periods listed:

Six months ended June 30,

Nine months ended September 30,

Common stock options issued and outstanding

131,142 144,287

Unvested restricted stock units

747,470 715,297

1,124,706 319,443

Common Stock Purchase Agreements

27,572,156 206,780

Conversion of convertible note

1,790,955 75,469

18,513 30,679

31,384,942 1,491,955

STOCK-BASED COMPENSATION

The following table summarizes stock-based compensation expense recorded in each financial statement line item in the Company’s condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2025 and 2024 (in thousands):

Three months ended June 30,

Six months ended June 30,

The following table summarizes stock-based compensation expense recorded in each financial statement line item in the Company’s condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2025 and 2024 (in thousands):

Three months ended September 30,

Nine months ended September 30,

Research and development

$ 316 $ 499 1,011 1,708

Sales and marketing

126 3 255 185

General and administrative

718 1,238 2,395 2,861

Total stock-based compensation

$ 1,160 $ 1,740 $ 3,661 $ 4,754

SEGMENT INFORMATION

7 unchanged sentences

Sale of Prototypes

The Company recorded revenue for prototype sales of $ 22 and $ 22 in the three and six months ended June 30, 2025 , respectively, and $ 6 and $ 26 in the three and six months ended June 30, 2024 , respectively.

The Company recorded revenue for prototype sales of $ 41 and $ 63 in the three and nine months ended September 30, 2025 , respectively, and $ 65 and $ 91 in the three and nine months ended September 30, 2024 , respectively.

The Company does not incur significant contract costs in fulfilling or obtaining its contracts with customers.

D evelopment Contracts

The Company has entered into research and development contracts as well as a sales, marketing and technical support services contract with companies in both the Automotive and in Non-Automotive industries.

The Company assessed the number of performance obligations associated with the promises under each agreement, primarily the delivery of customized perception-related goods and services, and recognized $ 0 and $ 64 in revenue for performance obligations that had been satisfied as of the three and six months ended June 30, 2025 , respectively, and $ 26 during both the three and six months ended June 30, 2024 in the condensed consolidated statements of operations and comprehensive loss.

The Company assessed the number of performance obligations associated with the promises under each agreement and recognized $ 9 and $ 73 in revenue for performance obligations that had been satisfied as of the three and nine months ended September 30, 2025 , respectively, and $ 39 and $ 65 during the three and nine months ended September 30, 2024 in the condensed consolidated statements of operations and comprehensive loss.

Disaggregation of Revenue

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

Three months ended June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

Revenue by primary geographical market:

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Contract Liabilities

The Company had $ 0 and $ 74 in contract liabilities balance as of June 30, 2025 and 2024.

There were no remaining performance obligations as of June 30, 2025 and December 31, 2024.

The Company had $ 0 and $ 35 in contract liabilities balance as of September 30, 2025 and 2024.

There were no remaining performance obligations as of September 30, 2025 and December 31, 2024.

Remaining Performance Obligations

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The customer is not considered committed where they are able to terminate for convenience without payment of a substantive penalty under the contract.

Additionally, as a practical expedient, the Company has not disclosed the value of unsatisfied performance obligations for contracts with an original expected length of one year or less.

The Company has not disclosed the value of unsatisfied performance obligations for contracts with an original expected length of one year or less.

The contract liabilities balance represents the remaining performance obligations for contracts with an original duration of greater than one year.

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In 2023, the Company implemented a revised strategic plan, which focused on reducing fixed operating activities by simplifying business operations and focusing development and commercial activities on a single unifying product for both the Automotive and Non-Automotive markets.

As part of its effort to reduce fixed operating costs, focus operations, simplify supply chains, and streamline manufacturing to unify around a single product, Apollo, the company wound down support for its legacy Non-Automotive product.

As part of its effort to reduce fixed operating costs, focus operations, simplify supply chains, and streamline manufacturing, the Company wound down support for its legacy Non-Automotive product.

In August 2024, the Company further reduced fixed operating costs and terminated its headquarters lease and in 2025, settled the amount of the lease termination liability.

See discussion in Note 5, Leases and Note 17, Commitment and Contingencies for further discussion regarding the settlement of the lease termination liability.

Restructuring charges are summarized as follows for the six months ended June 30, 2025 (in thousands):

Restructuring charges are summarized as follows for the nine months ended September 30, 2025 (in thousands):

Losses on purchase commitments

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Balance as of December 31, 2024

$ 297 $ 3,313 $ 5 $ 3,615

— ( 1,612 ) — ( 1,612 )

Cash payments

( 30 ) ( 1,400 ) — ( 1,430 )

Balance as of June 30, 2025

$ 267 $ 301 $ 5 $ 573

For the six months ended June 30, 2025 and 2024 , the Company recognized $ 2 and $ 2 provision for income taxes, respectively.

Issuance of warrants

Balance as of September 30, 2025

For the nine months ended September 30, 2025 and 2024 , the Company recognized $ 2 and $ 2 provision for income taxes, respectively.

The income tax rates vary from the federal and state statutory rates due to the valuation allowances on the Company’s net operating losses and foreign tax rate differences.

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The Company records a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

On August 28, 2024 , the Company was served with a complaint that was filed in the Superior Court of California for the County of Alameda on August 26, 2024 that ( 1 ) alleged the Company was in breach of the lease for its former headquarters office in Dublin, California because of the Company’s failure to pay rent as required by the lease and ( 2 ) provided notice that the lease had been terminated by the landlord effective as of August 23, 2024.

In 2025, the Company was notified by a former vendor that it intended to pursue a claim against the Company’s wholly owned subsidiary, AEye Technologies, Inc., arising out of an agreement entered into in May 2020, in which the former vendor alleges that AEye Technologies, Inc.

failed to pay approximately $ 3,300 plus interest from the date the former vendor alleges such payments were due.

AEye Technologies, Inc.

has, and continues to dispute the total amount owed based, in part, on AEye Technologies, Inc.’s claim that the products supplied by the former vendor were largely defective and such former vendor was repeatedly made aware of the existence of such defects.

In 2024, the Company was purportedly served with a complaint that ( 1 ) alleged the Company was in breach of the lease for its former headquarters office in Dublin, California because of the Company’s failure to pay rent as required by the lease and ( 2 ) provided notice that the lease had been terminated by the landlord effective as of August 23, 2024.

The landlord claimed that the amount owed could be up to $ 8,500 .

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On April 28, 2025, the Company and the former landlord entered into a settlement agreement to resolve all outstanding disputes related to the early termination of the lease.

Under the terms of the agreement, the Company paid $ 1,400 in cash in May 2025, and will issue warrants to purchase up to 350,000 shares of common stock at an initial exercise price of $ 2.22 per share.

Under the terms of the agreement, the Company paid $ 1,400 in cash in May 2025 and issued warrants to purchase up to 350,000 shares of common stock at an exercise price of $ 2.22 per share in August 2025.

SUBSEQUENT EVENTS

Subsequent to June 30, 2025, the Company issued 17,889,400 shares of its common stock under the common stock purchase agreements for total gross proceeds of $ 67,057 .

Additionally, a noteholder exercised warrants to purchase 805,263 shares of common stock for a total exercise price of $ 1,788 .

Subsequent to September 30, 2025, the Company issued 3,164,545 shares of its common stock under the CSPA for total gross proceeds of $ 9,974 .

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

This Management ’ s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that are based on current expectations, estimates, assumptions, and projections about our industry, business, and future financial results.

Our actual results and the timing of events may differ materially from those described in or implied by these forward-looking statements due to a number of factors, including those discussed below and those set forth under “ Risk Factors ” herein and other filings we make with the SEC from time to time.

Our actual results and the timing of events may differ materially from those described in or implied by these forward-looking statements due to a number of factors, including those discussed below and those set forth under in Part II, Item 1A, of this Quarterly Report under the heading “ Risk Factors ” and other filings we make with the SEC from time to time.

Unless the context otherwise requires, references in this Management ’ s Discussion and Analysis of Financial Condition and Results of Operations to “ we, ” “ our, ” “ us, ” and “ AEye, ” refer to the business and operations of AEye, Inc.

This overview provides a high-level discussion of our operating results and some of the trends that affect our business.

We believe that an understanding of these trends is important to understanding our financial results for the six months ended June 30, 2025, as well as our future prospects.

We believe that an understanding of these trends is important to understanding our financial results for the nine months ended September 30, 2025, as well as our future prospects.

This summary is not intended to be exhaustive, nor is it intended to be a substitute for the detailed discussion and analysis provided elsewhere in this Quarterly Report, including our condensed consolidated financial statements and accompanying notes.

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Key Factors Affecting Our Operating Results

We believe that our future performance and success depends, to a substantial extent, on our ability to capitalize on the opportunities described herein, which in turn are subject to significant risks and challenges, including those discussed below and the risk factors described in the “Risk Factors” section of this Quarterly Report on Form 10-Q.

We believe that our future performance and success depends, to a substantial extent, on our ability to capitalize on the opportunities described herein, which in turn are subject to significant risks and challenges, including those discussed below and the information described in Part II, Item 1A, of this Quarterly Report under the heading “Risk Factors”.

We are 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 commercialize our products;

securing additional capital in a timely manner in order to meet operating cash flow needs;

doing so on terms that are favorable to us, or at all, which may be challenging given the current capital markets and overall macroeconomic conditions;

maintain and establish relationships with one or more Tier 1 automotive suppliers to facilitate “design wins” with potential end customers, which in our case are automotive OEMs;

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We anticipate growing demand for our Intelligent Sensing Platform across our two major markets, Automotive and Non-Automotive, and we believe this expected growth will enable us to capture market share across both the Automotive and Non-Automotive markets.

We plan to pursue opportunities in advanced driver-assistance systems, or ADAS, autonomous driving, and commercial trucking, while also exploring opportunities in the Non-Automotive market, such as in the railway, airport safety and security, perimeter monitoring, transportation logistics, and intelligent transportation systems, or ITS segments.

We plan to pursue opportunities in advanced driver-assistance systems, or ADAS, autonomous driving, and commercial trucking, while also exploring opportunities in the Non-Automotive market, such as in the railway, airport safety and security, perimeter monitoring, aerospace and defense, transportation logistics, and intelligent transportation systems, or ITS segments.

This diversified approach provides us with multiple opportunities for sustained growth by enabling new applications and product features across a broad range of industries and market segments.

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The markets for lidar are projected to see significant growth in both the near and long-term.

We recently raised additional capital that we expect will provide us with an operating runway for at least the next 12 months and allow us to fund our short- and mid-term strategic initiatives.

As is common in early-stage companies with limited operating histories, we are subject to risks and uncertainties such as those described in Part II, Item 1A of this Quarterly Report on Form 10-Q.

Since inception, we have incurred net losses and negative cash flows from operations and expect to continue incurring losses until at least commercialization.

Accordingly, we expect to remain dependent on raising additional capital to provide the cash necessary to continue our ongoing operations.

As a result, it remains critical for us to preserve cash and manage spending to extend our liquidity.

We also plan to improve our liquidity position through securing additional financing, engaging with partners and OEMs, and executing on our critical milestones.

However, successfully raising capital is outside of our control, and there can be no assurance that we will be able to obtain additional financing on terms acceptable to us, on a timely basis, or at all.

During the six months ended June 30, 2025, we raised $11,637 in gross proceeds through share issuances through our common stock purchase agreements and a convertible note.

Subsequent to June 30, 2025, we raised $68,844 in gross proceeds through issuance of shares through our common stock purchase agreements and an exercise of warrants.

We also have additional liquidity available through our equity line of credit and ATM facilities.

Partnerships and Commercialization

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We consider design wins to be critical to our future success, although the revenue that may be generated by each design win and the time necessary to achieve such a design win can vary significantly, making it difficult to predict our financial performance.

In large part, we plan to unify our supply chain for the Automotive and Non-Automotive markets and leverage our Tier 1 automotive suppliers to produce products for our resale in our Non-Automotive markets, whereas in the Automotive markets, we anticipate licensing our technology to our Tier 1 suppliers in exchange for a royalty.

In large part, we plan to unify our supply chain for the Automotive and Non-Automotive markets and leverage our Tier 1 automotive suppliers to produce products for us to sell into our Non-Automotive markets, whereas in the Automotive markets, we anticipate licensing our technology to our Tier 1 suppliers in exchange for a royalty.

The unified supply chain should allow us to leverage the scale, efficiencies, and volume associated with supplying the Automotive market to benefit our Non-Automotive market customers.

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In early 2024, we engaged LITEON as our Tier 1 automotive supplier and are actively working with them to bring our product to market.

We recently announced the successful production of the first Apollo units by LITEON, which we believe demonstrates an ability to produce units at scale.

This partnership has enabled us to leverage LITEON’s manufacturing expertise to produce high-quality samples that meet stringent performance standards, which is a critical step towards scaling production and delivering our advanced lidar solutions to the market.

In May 2024, we announced a strategic partnership with ATI and LighTekton Co., Ltd to manufacture and distribute our products in China.

We recently announced an expansion of this relationship and an investment from a leading global institutional investor to fund a dedicated production line for Apollo, with capacity to produce up to 60,000 units annually.

We are seeing an inflection point in customer demand, and this expansion ensures we can meet that growth head-on.

This partnership enables us to leverage LITEON’s manufacturing expertise to produce high-quality products that meet stringent performance standards, which is a critical step towards scaling production and delivering our advanced lidar solutions to the market.

In May 2024, we announced a strategic partnership with Accelight Technologies, Inc.

("ATI") and LighTekton Co., Ltd to manufacture and distribute our products in China.

This collaboration provides us with access to a potential $2.5 billion market opportunity.

By leveraging ATI's and LighTekton's extensive networks and manufacturing capabilities, we aim to accelerate our market penetration and deliver our advanced lidar solutions to a broader audience.

We have also made substantial progress in our collaboration efforts with Nvidia.

Most recently, we announced the integration of our lidar technology into Nvidia’s DRIVE AGX Orin platform, which we believe represents a significant milestone in expanding our reach within the automotive ecosystem.

In July 2025, we announced the integration of our lidar technology into Nvidia’s DRIVE AGX Orin platform, which we believe represents a significant milestone in expanding our reach within the automotive ecosystem.

This integration is expected to open new opportunities to engage with global automotive OEMs and Tier 1 suppliers as they adopt Nvidia’s autonomous driving solutions.

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Given these engagements are relatively recent, there is no guarantee that these endeavors will be successful.

In July 2025, we launched OPTIS™, a complete physical AI solution designed to modernize legacy infrastructure and deliver actionable intelligence across diverse industries.

OPTIS™ integrates our software-defined Apollo LiDAR technology with advanced computing to bridge the gap between perception and real-time action.

Beyond addressing critical needs in transportation, safety, and security, OPTIS™ opens our platform to third-party partners and developers, creating an ecosystem for innovation and growth beyond automotive applications.

Since launch, we’ve transitioned OPTIS™ from concept to a structured offering, with initial deployments already completed.

Recent additions to our partner network include Black Sesame Technologies, BlueBand, and Flasheye.

We believe our revenue and profitability will also be dependent upon our success in licensing our technology to Tier 1 automotive suppliers, such as our current Tier 1 partner, LITEON, and these partners securing program awards from OEMs and scaling to high volume production of our lidar sensors.

Delays in autonomy programs by OEMs that we are currently or plan to be working with through our Tier 1 partners could result in us being unable to achieve our revenue and profitability targets in the time frame we anticipate, or at all.

In July 2025, we announced the launch of OPTIS TM , a complete physical AI solution designed to enhance legacy infrastructure and deliver actionable intelligence across a wide range of industries.

OPTIS TM combines our software-defined Apollo lidar technology with advanced computing to bridge the gap between perception and action in real time.

This solution is intended to not only address critical needs in transportation, safety, and security, but also opens our platform to third-party partners and developers, creating an ecosystem for innovation and growth beyond automotive applications.

Our gross margins will depend on numerous factors, including, among others, the selling price of our products, pricing of our development contracts with customers, royalty rates on licenses we grant to our customers, unit volumes, product mix, component costs, personnel costs, contract manufacturing costs, overhead costs, and product features.

Our gross margins have in the past, and may continue to be, negatively impacted by inventory write-downs.

Our gross margins have and may continue to be, negatively impacted by inventory write-downs.

In the future, we expect to generate attractive gross margins from licensing our lidar technology and software to our Tier 1 partners in the Automotive market.

We also anticipate being able to leverage on our foundation in the Automotive market to move to other markets.

To date, our revenue has primarily been generated through development contracts with OEMs and Tier 1 suppliers, as well as unit sales of our products to Non-Automotive customers.

These development contracts primarily focus on customization of our product's capabilities to our customers’ applications, typically involving software implementation to assist with sensor connection and control, customization of scan patterns, and enhancement of particular perception capabilities to meet specific customer needs.

In general, development contracts that require more complex configurations have higher prices.

We expect development contracts to remain a significant part of our business in the near term, but represent a smaller share of our total revenue over time as we increase our focus on technology licensing in the Automotive market and leverage these economies of scale to expand into the Non-Automotive market.

We also anticipate being able to leverage on our foundation in the Automotive market to be more cost competitive in other markets.

To date, we have primarily generated revenue through development contracts with OEMs and Tier 1 suppliers, as well as sales of our products to Non-Automotive customers.

These contracts primarily focus on customization of our product's capabilities to our customers’ applications, typically involving software implementation to assist with sensor connection and control, customization of scan patterns, and enhancement of particular perception capabilities to meet specific customer needs.

In general, contracts that require more complex configurations have higher prices.

Investment and Innovation

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With a horizontal field of view up to 120° and long-range detection capabilities of up to 1 kilometer, Apollo is poised to be a key player in advancing vehicle safety and autonomy, as well as smart infrastructure and logistics applications.

In July 2025, we announced OPTIS™, a physical AI solution designed to modernize legacy infrastructure by delivering actionable intelligence in real time.

This platform opens our ecosystem to third-party partners and developers, creating opportunities for growth across industries.

Building on this foundation, we launched OPTIS™ in July 2025, a complete physical AI solution that extends our capabilities beyond automotive.

OPTIS™ combines Apollo’s software-defined LiDAR with advanced computing to deliver actionable intelligence for modernizing legacy infrastructure.

This platform not only addresses critical needs in transportation, safety, and security but also opens our ecosystem to third-party partners and developers, fostering innovation across industries.

Since launch, OPTIS™ has moved from concept to structured offering, with initial deployments completed and new partners such as Black Sesame Technologies, BlueBand, and Flasheye joining our network.

We believe our financial performance is significantly dependent on our ability to maintain a technology leadership position.

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We believe price is becoming a critical differentiator in the marketplace and OEMs are favoring companies that have the infrastructure to build lower cost products at higher volumes.

It is essential that we continually identify and respond to rapidly evolving customer requirements, develop and introduce innovative new products, enhance and service existing products, lower bill of materials, or BOM, costs, industrialize the manufacturing process, and generate strong market demand for our products.

It is essential that we continually identify and respond to rapidly evolving customer requirements, develop and introduce innovative new products, enhance and service existing products, lower the bill of materials, or BOM, industrialize the manufacturing process, and generate strong market demand for our products.

If we fail to do this, our market position and revenue may be adversely affected, and our investments in that area will not be recovered.

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Total Revenues

Our prototype sales revenue primarily related to unit sales of our lidar products.

Revenue from prototype sales is typically recognized at a point in time when the control of goods is transferred to the customer, generally upon delivery or shipment to the customer.

Revenue from development and/or collaboration arrangement contracts are earned from R&D activities and collaboration with OEMs and Tier 1 suppliers.

Our prototype sales revenue primarily relates to unit sales of our lidar products.

Revenue from prototype sales is typically recognized at a point in time when the control of the goods is transferred to the customer, generally upon delivery of or shipment to the customer.

Revenue from development and/or collaboration contracts are earned from R&D activities and collaboration with OEMs and Tier 1 suppliers.

These contracts primarily focus on customization of our product's capabilities to our customers’ applications, typically involving software implementation to assist with sensor connection and control, customization of scan patterns, and enhancement of perception capabilities to meet specific customer needs.

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This assessment is made at the outset of the arrangement for each performance obligation.

We are seeing strong, renewed interest in Apollo from non-automotive customers across multiple industries and are actively advancing these opportunities, which typically have shorter cycle times as compared to automotive customers.

Proof-of-concept deployments are validating our technology in real-world scenarios, creating a solid foundation for future growth.

While customer evaluation and testing cycles are typically extended, these engagements position us well for gradual revenue contributions and set the stage for meaningful expansion.

We view this as the first step in a disciplined growth roadmap designed to unlock adoption and scale with confidence.

Cost of Revenue

Cost of revenue includes the costs directly associated with the production of prototypes and certain costs associated with development contracts.

Such costs for prototypes include direct materials, direct labor, indirect labor, inventory write downs, losses on purchase commitments, warranty expense, and allocation of overhead.

Such costs for prototypes include direct materials, costs of the contract manufacturer, direct labor, indirect labor, inventory write downs, losses on purchase commitments, warranty expense, and allocation of overhead.

Costs associated with development contracts include the direct costs and allocation of overhead costs involved in the execution of the contracts.

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Research and Development

Our research and development, or R&D, efforts are focused primarily on hardware, software, and system engineering related to the design and development of our advanced lidar solutions.

Our research and development ("R&D"), efforts are focused primarily on hardware, software, and system engineering related to the design and development of our advanced lidar solutions.

R&D expenses include:

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R&D costs are expensed as they are incurred.

We expect our R&D costs to increase from 2024 as we continue to invest in the development and commercialization of our products.

We expect our R&D costs to increase as we continue to invest in the development and commercialization of our products.

Sales and Marketing

Our sales and marketing, or S&M, efforts are focused primarily on sales, business development, and marketing programs in pursuit of revenue contracts from potential and existing customers.

Our sales and marketing ("S&M"), efforts are focused primarily on sales, business development, and marketing programs in pursuit of revenue contracts from potential and existing customers.

S&M expenses include:

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allocated personnel and overhead expenses.

We expect our S&M expenses to increase from 2024 as we pursue Non-Automotive opportunities to accelerate profitability while continuing to leverage our Tier 1 partners to commercialize our products and manage relationships with the OEMs in the Automotive market.

We expect our S&M expenses to increase as we pursue Non-Automotive opportunities to accelerate profitability while continuing to leverage our Tier 1 partners to commercialize our products and manage relationships with the OEMs in the Automotive market.

General and Administrative

Our general and administrative, or G&A, spending supports all business functions.

Our general and administrative ("G&A"), spending supports all business functions.

G&A expenses include:

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allocated overhead expenses.

We expect our G&A expenses to decrease slightly from 2024 with reduced facility costs, while continuing to incur expenses to support other departments as we continue to develop and commercialize our products.

We expect our G&A expenses to increase to support growth as we pursue Non-Automotive opportunities and as we continue to develop and commercialize our products.

Change in Fair Value of Convertible Note and Warrant Liabilities

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We also elected to record interest expense on the 2025 Note as changes in fair value.

We expect the change in fair value of warrant liability to decrease given that subsequent to June 30, 2025, the warrants associated with the 2022 convertible note were cancelled and the warrants associated with the 2025 convertible note were exercised in full.

We expect the change in fair value of the convertible note to decrease in future periods, reflecting the lower outstanding balance as of September 30, 2025.

In addition, we expect the change in fair value of warrant liabilities to decrease as the warrants associated with the 2022 Note were cancelled and the warrants associated with the 2025 Note were exercised in full.

Interest Income, Interest Expense and Other

Interest income and other consists primarily of interest earned on our cash, cash equivalents, and marketable securities.

These amounts will vary based on our cash and cash equivalents balances and market rates.

Interest income and other consists primarily of interest and investment income earned on our cash, cash equivalents, and marketable securities.

These amounts will vary based on our cash, cash equivalents, and marketable securities balances and market rates.

Interest income and other also includes gains on sale of property and equipment.

Interest expense and other consists primarily of financing costs, and amortization of premiums and accretion of discounts on marketable securities, net.

We expect interest income will increase due to funds raised subsequent to June 30, 2025.

We expect interest income will increase due to higher cash, cash equivalents, and marketable securities balances.

Results of Operations

Comparison of the three months ended June 30, 2025 and 2024

Comparison of the three months ended September 30, 2025 and 2024

The results of operations presented below should be reviewed in conjunction with the condensed consolidated financial statements and notes included elsewhere in this report.

The following table sets forth our consolidated results of operations data for the three months ended June 30, 2025 and 2024 (in thousands, except for percentages):

Three months ended June 30,

The following table sets forth our consolidated results of operations data for the three months ended September 30, 2025 and 2024 (in thousands, except for percentages):

Three months ended September 30,

Cost of revenue

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Total other income (expense), net

Loss before income tax expense

Provision for income tax expense

Revenues decreased by $10, or 31%, to $22 for the three months ended June 30, 2025, from $32 for the three months ended June 30, 2024.

This decrease is primarily due to lower contract development revenues, partially offset by an increase in the number of prototype unit sales in the current quarter.

Loss before income tax

Provision for income tax

NM - not meaningful

Revenues decreased by $54, or 52%, to $50 for the three months ended September 30, 2025, from $104 for the three months ended September 30, 2024.

This decrease is primarily due to lower contract development revenues in the current quarter and also due to higher unit sales of our legacy product in the three months ended September 30, 2024.

Cost of Revenue

Cost of revenue decreased by $52, or 33%, to $108 for the three months ended June 30, 2025, from $160 for the three months ended June 30, 2024.

This decrease was primarily due to lower contract development costs in the current quarter and inventory write-downs recorded in the three months ended June 30, 2024.

Cost of revenue decreased by $203, or 66%, to $103 for the three months ended September 30, 2025, from $306 for the three months ended September 30, 2024.

This decrease was primarily due to lower contract development costs in the current quarter;

the decrease is also due to higher unit sales of our legacy product and inventory write-downs recorded in the three months ended September 30, 2024 related to certain legacy Non-Automotive components.

Operating Expenses

Research and Development

Research and development expenses decreased by $168, or 4%, to $3,670 for the three months ended June 30, 2025, from $3,838 for the three months ended June 30, 2024.

This decrease was primarily driven by decreases in stock-based compensation expense of $189 and information technology and facilities expense of $431.

The decreases were offset by a $361 increase in fees paid to third parties for development work and personnel costs, net of allocations, of $120.

Research and development expenses decreased by $706, or 19%, to $3,061 for the three months ended September 30, 2025, from $3,767 for the three months ended September 30, 2024.

This decrease was primarily driven by decreases in stock-based compensation expense of $715 and allocated information technology and facilities expense of $225.

The decreases were partially offset by an increase in personnel costs, net of allocations, of $262.

Sales and Marketing

Sales and marketing expenses increased by $534, or 797%, to $601 for the three months ended June 30, 2025, from $67 for the three months ended June 30, 2024.

This increase was primarily driven by increases in allocated personnel costs and stock-based compensation of $484 and marketing and consulting costs of $60 as we pursue Non-Automotive opportunities.

Sales and marketing expenses increased by $557, to $631 for the three months ended September 30, 2025, from $74 for the three months ended September 30, 2024.

This increase was primarily driven by increases in personnel costs, including allocations, of $484 and marketing spend of $86.

General and Administrative

General and administrative expenses increased by $125, or 3%, to $4,348 for the three months ended June 30, 2025, from $4,223 for the three months ended June 30, 2024.

This increase was primarily driven by increases in accounting, legal and consulting fees of $554, partially offset by decreases in stock-based compensation and personnel costs, net of allocations, of $515.

General and administrative expenses increased by $277, or 7%, to $4,080 for the three months ended September 30, 2025, from $3,803 for the three months ended September 30, 2024.

This increase was primarily driven by an increase in rent expense of $1,061, primarily resulting from the lease settlement expense of $598, attributable to an increase in the liability related to the fair value of the warrant issued in connection with the settlement, compared to a gain recorded in the three months ended September 30, 2024.

This increase was partially offset by decreases in stock-based compensation and personnel costs, net of allocations, of $814.

Change in Fair Value of Convertible Note and Warrant Liabilities

Change in fair value of convertible note and warrant liabilities increased by $578 to $593 for the three months ended June 30, 2025, from $15 for the three months ended June 30, 2024.

This increase was primarily due to the change in fair value of the 2025 Note and related warrants, which were newly issued in 2025.

Change in fair value of convertible note and warrant liabilities increased by $2,219 to an expense of $2,210 for the three months ended September 30, 2025, from a gain of $9 for the three months ended September 30, 2024.

This increase was primarily due to the change in fair value of the 2025 Note and related warrants, which were newly issued in 2025, and also due to higher stock prices in the current quarter, resulting in a higher valuation of the warrant associated with the 2022 Note through the cancellation date in the current quarter.

Interest Income and Other

Interest income and other increased by $165, or 72%, to $393 for the three months ended June 30, 2025, from $228 for the three months ended June 30, 2024.

This increase was primarily due to insurance proceeds received of $250, partially offset by lower interest earned on our cash equivalents and marketable securities in the current period.

Interest income and other increased by $417, or 179%, to $650 for the three months ended September 30, 2025, from $233 for the three months ended September 30, 2024.

This increase was primarily due to higher interest and investment income earned on our cash, cash equivalents, and marketable securities in the current period.

Interest Expense and Other

Interest expense and other increased by $421, or 752%, to a net expense of $365 for the three months ended June 30, 2025, from a net income of $56 for the three months ended June 30, 2024.

This increase was primarily due to an increase in costs related to financing arrangements of $231 and foreign exchange losses.

Provision for Income Tax Expense

Provision for income tax expenses remained constant at $0 for the three months ended June 30, 2025 and June 30, 2024.

Net loss increased by $1,283, or 16%, to $9,270 for the three months ended June 30, 2025, from $7,987 for the three months ended June 30, 2024.

This increase was primarily due to increased personnel costs, investments in the development of Apollo and changes in fair value of convertible note and warrants, partially offset by decreases in stock-based compensation and facilities expenses.

Interest expense and other decreased by $1,157, to a net income of $55 for the three months ended September 30, 2025, from a net expense of $1,102 for the three months ended September 30, 2024.

This decrease was primarily due to a decrease in costs related to financing arrangements of $1,117 and lower foreign exchange losses of $110, partially offset by lower accretion of discount on marketable securities, net of $69.

Provision for Income Tax

Provision for income tax expenses remained constant at $0 for the three months ended September 30, 2025 and September 30, 2024.

Net loss increased by $624, or 7%, to $9,330 for the three months ended September 30, 2025, from $8,706 for the three months ended September 30, 2024.

This increase was primarily due to increased personnel costs and changes in fair value of convertible note and warrants, partially offset by decreases in stock-based compensation and facilities expenses.

Results of Operations

Comparison of the six months ended June 30, 2025 and 2024

Comparison of the nine months ended September 30, 2025 and 2024

The results of operations presented below should be reviewed in conjunction with the condensed consolidated financial statements and notes included elsewhere in this report.

The following table sets forth our consolidated results of operations data for the six months ended June 30, 2025 and 2024 (in thousands, except for percentages):

Six months ended June 30,

The following table sets forth our consolidated results of operations data for the nine months ended September 30, 2025 and 2024 (in thousands, except for percentages):

Nine months ended September 30,

Total revenue

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Total other income (expense), net

Loss before income tax expense

Provision for income tax expense

Revenues increased by $34, or 65%, to $86 for the six months ended June 30, 2025, from $52 for the six months ended June 30, 2024.

This increase is primarily due to higher contract development revenues, partially offset by lower prototype unit sales in the current quarter.

Loss before income tax

Provision for income tax

NM - not meaningful

Revenues decreased by $20, or 13%, to $136 for the nine months ended September 30, 2025, from $156 for the nine months ended September 30, 2024.

This decrease is primarily due to higher unit sales of our legacy product in the prior year, partially offset by higher contract development revenues.

Cost of Revenue

Cost of revenue decreased by $219, or 52%, to $204 for the six months ended June 30, 2025, from $423 for the six months ended June 30, 2024.

This decrease was primarily due to inventory write-downs and losses on purchase commitments recorded in the six months ended June 30, 2024, resulting from implementation of our strategic plan to wind down support for our legacy Non-Automotive product.

Cost of revenue decreased by $422, or 58%, to $307 for the nine months ended September 30, 2025, from $729 for the nine months ended September 30, 2024.

This decrease was primarily due to inventory write-downs and losses on purchase commitments recorded in the nine months ended September 30, 2024, resulting from implementation of our strategic plan to wind down support for our legacy Non-Automotive product.

Operating Expenses

Research and Development

Research and development expenses decreased by $1,210, or 14% to $7,160 for the six months ended June 30, 2025, from $8,370 for the six months ended June 30, 2024.

This decrease was primarily driven by decreases in stock-based compensation expense and personnel costs, net of allocation, of $869, and information technology and facilities expense of $893.

The decreases were offset by a $711 increase in fees paid to third parties for development work.

Research and development expenses decreased by $1,916, or 16% to $10,221 for the nine months ended September 30, 2025, from $12,137 for the nine months ended September 30, 2024.

This decrease was primarily driven by decreases in stock-based compensation expense of $1,381, and allocated information technology and facilities expense of $1,118.

The decreases were offset by a $400 increase in fees paid to third parties for development work and engineering parts and lab equipment expenses.

Sales and Marketing

Sales and marketing expenses increased by $576, or 141% to $984 for the six months ended June 30, 2025, from $408 for the six months ended June 30, 2024.

This increase was primarily driven by increases in allocated personnel and stock-based compensation costs of $778 and marketing and consultant spend of $85 as we pursue Non-Automotive opportunities.

Sales and marketing expenses increased by $1,133, or 235% to $1,615 for the nine months ended September 30, 2025, from $482 for the nine months ended September 30, 2024.

This increase was primarily driven by increases in allocated personnel of $1,262 and marketing and consultant spend of $171 as we pursue Non-Automotive opportunities.

These increases were partially offset by a $329 decrease in stock-based compensation and allocated information technology and facilities expense.

General and Administrative

General and administrative expenses decreased by $2,595, or 26%, to $7,243 for the six months ended June 30, 2025, from $9,838 for the six months ended June 30, 2024.

This decrease was primarily driven by a favorable adjustment of $1,612 upon settlement of a lease dispute, decreases in stock-based compensation and personnel cost, net of allocations, of $1,202.

These decreases were partially offset by an increase in accounting, legal, and professional fees of $579.

General and administrative expenses decreased by $2,318, or 17%, to $11,323 for the nine months ended September 30, 2025, from $13,641 for the nine months ended September 30, 2024.

This decrease was primarily due to a decrease in rent expense of $1,730, primarily due to the net gain recorded for the lease settlement in the nine months ended September 30, 2025 and reduced rent expense as a result of leasing smaller facilities.

The decrease is also due to lower stock-based compensation and personnel cost, net of allocations, of $2,016.

These decreases were partially offset by an increase in accounting, legal, and professional fees of $681 and lower facilities and IT allocations of $1,137.

Change in Fair Value of Convertible Note and Warrant Liabilities

Change in fair value of convertible note and warrant liabilities increased by $100 to $87 for the six months ended June 30, 2025, from a net gain $13 for the six months ended June 30, 2024.

Change in fair value of convertible note and warrant liabilities increased by $2,119 to a $2,123 expense for the nine months ended September 30, 2025, from a net gain of $4 for the nine months ended September 30, 2024.

This increase was primarily due to the change in fair value of the 2025 Note and related warrants, which were newly issued in 2025.

Interest Income and Other

Interest income and other increased by $184 or 43%, to $607 for the six months ended June 30, 2025, from $423 for the six months ended June 30, 2024.

This increase was primarily due to insurance proceeds received of $250, partially offset by lower interest earned on our cash equivalents and marketable securities in the current period.

Interest income and other increased by $601 or 92%, to $1,257 for the nine months ended September 30, 2025, from $656 for the nine months ended September 30, 2024.

This increase was primarily due to insurance proceeds received of $250 and higher interest earned on cash, cash equivalents, and marketable securities in the current period.

Interest Expense and Other

Interest expense and other increased by $2,846, or 763%, to a net expense of $2,473 for the six months ended June 30, 2025, from a net income of $373 for the six months ended June 30, 2024.

This increase was primarily due to an increase in costs related to financing arrangements in the current period and a decrease in amortization of premiums on marketable securities, net.

Provision for Income Tax Expense

Provision for income tax expenses remained constant at $2 for the six months ended June 30, 2025 and June 30, 2024.

Net loss decreased by $920, or 5% to $17,286 for the six months ended June 30, 2025, from $18,206 for the six months ended June 30, 2024.

Interest expense and other increased by $1,689, or 232%, to $2,418 for the nine months ended September 30, 2025, from $729 for the nine months ended September 30, 2024.

This increase was primarily due to an increase in costs related to financing arrangements in the current period and a decrease in accretion of discounts on marketable securities, net.

Provision for Income Tax

Provision for income tax expenses remained constant at $2 for the nine months ended September 30, 2025 and September 30, 2024.

Net loss decreased by $296, or 1% to $26,616 for the nine months ended September 30, 2025, from $26,912 for the nine months ended September 30, 2024.

This decrease was primarily due to decreases in stock-based compensation, personnel and facilities expenses, partially offset by the increase in the change in fair value of convertible note and warrants, and investments in the development of Apollo.

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Our capital requirements will depend on many factors, including, but not exclusively, sales volume and timing of revenue, our efforts to establish and maintain a relationship with one or more Tier 1 automotive suppliers and the timing of any OEM design wins, our ability to effectively and efficiently manage our expenses, the timing and extent of spending to support R&D efforts, how quickly we can commercialize our products, and the market adoption of new and enhanced products and features.

As of June 30, 2025, our cash, cash equivalents, and marketable securities totaled $19,210.

Subsequent to June 30, 2025, we successfully raised additional capital of $68,844 on the issuance of shares from our common stock purchase agreements and the exercise of certain warrants.

For the six months ended June 30, 2025 and 2024, we had a net loss of $17,286 and $18,206, respectively.

We anticipate that we will continue to incur losses for at least the next several years.

Our principal source of liquidity are the proceeds received from the issuance of equity.

We recently raised additional capital that we expect will provide us with an operating runway for at least 12 months and allow us to fund our short- and mid-term strategic initiatives.

To date, our principal sources of liquidity have been the proceeds received from the issuance of equity.

Tumim Stone Transaction

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On September 26, 2023, the U.S.

Securities and Exchange Commission declared our registration statement on Form S-3 to be effective, which allows us to raise up to $200,000 in capital over the next three years subject to a limitation of one-third of our public float over a rolling twelve-month period, when our public float is below $75 million, which is referred to as the “baby shelf" rules.

As of July 28, 2025, we were no longer subject to the "baby shelf" rules.

Securities and Exchange Commission declared our Registration Statement on Form S-3 effective (the "Shelf"), which allows us to raise up to $200,000 in capital over the following three years.

The use of the Shelf is subject to a limitation of one-third of our public float in any rolling twelve-month period, when our public float is below $75 million, which is referred to as the “baby shelf" rules.

As of July 28, 2025, we have not been subject to the "baby shelf" rules.

Since the Shelf was established, we have used the Shelf to register the shares sold in the May 29, 2024 Registered Direct Offering and the September 12, 2024 A.G.P.

Transaction, both of which are further described below.

Dowslake Transaction

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On July 25, 2024, we entered into a Stock Purchase Agreement with New Circle Principal Investments LLC, or New Circle, pursuant to which we have the right, but not the obligation, to sell to New Circle, and New Circle is obligated to purchase, up to $50,000 of our common stock.

Such sales of common stock by us, if any, and may occur from time to time at our sole discretion, over a 36-month period.

As of June 30, 2025, we have issued 3,480,713 shares of our common stock to New Circle under the CSPA for gross proceeds totaling $6,480.

Such sales of common stock by us, if any, may occur from time to time at our sole discretion, over a 36-month period.

As of September 30, 2025, we have issued 8,980,713 shares of our common stock to New Circle under the CSPA for gross proceeds totaling $27,754.

On September 12, 2024, we entered into an At Market Issuance Sales Agreement with Alliance Global Partners, or A.G.P., pursuant to which we may issue and sell through A.G.P., up to $2,600 of our common stock from time to time through an "at-the-market" equity offering program.

In July 2025, we increased the aggregate amount available under the ATM program to $75,000, following multiple prior increases since the original agreement.

Such sales of common stock by us, if any, may occur from time to time at our sole discretion, over a 36-month period.

As of June 30, 2025, we have sold 6,395,643 shares under the ATM Agreement for gross proceeds totaling $8,825.

As of September 30, 2025, we have sold 20,056,239 shares under the ATM Agreement for gross proceeds totaling $58,462.

Subsequent to September 30, 2025, we raised additional capital of $9,768 through the sale of 3,164,545 shares under this agreement.

2025 Convertible Note

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The 2025 Note is convertible into Common Stock, at a per share conversion price equal to $2.22, subject to adjustments noted in the 2025 Note.

The Warrant has an initial exercise price of $2.22, and is exercisable after the six month and one day anniversary of its issuance (the “Initial Exercisability Date”) until for four years following the Initial Exercisability Date.

Until we are able to generate sufficient revenue from the sale of our products to cover operating expenses, working capital, and capital expenditures, we expect the funds raised in the transactions described earlier, and other potential sources of capital, is sufficient to fund our near-term cash needs.

The Warrant has an exercise price of $2.22 and is exercisable after the six month and one day anniversary of its issuance (the “Initial Exercisability Date”) until for four years following the Initial Exercisability Date.

These warrants were exercised in full on July 28, 2025.

During the nine months ended September 30, 2025, the Company made cash payments of $989.

Additionally, $2,485 in aggregate principal and interest were converted into 2,356,500 shares of common stock.

As of September 30, 2025, the 2025 Note has an outstanding principal balance and accrued interest of $106.

If we are required to raise additional funds by issuing equity securities, dilution of stockholders will result.

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We may also be unable to raise additional capital through the sale of securities and debt financing, or to do so on terms that are favorable to us, particularly given current capital market and overall macroeconomic conditions.

Accounting Standards Codification, or ASC, Subtopic 205-40, Presentation of Financial Statements - Going Concern , requires us to assess our ability to meet our future financial obligations as they become due within one year after the date that the financial statements are issued.

For the nine months ended September 30, 2025 and 2024, we had a net loss of $26,616 and $26,912, respectively.

We expect that our expenses will continue to exceed our operating income and, as a result, we may need additional capital resources to fund our operations.

We believe that our cash, cash equivalents and marketable securities at June 30, 2025, together with the additional proceeds raised subsequent to quarter-end of $68,844, we currently have sufficient financial resources to fund our operating expenses, working capital, and capital expenditure requirements for a period of at least twelve months from the date of this Quarterly Report on Form 10-Q.

Given the current macroeconomic environment, OEMs appear to be more cautious about their capital spending and investments into new technologies and as a result we have seen the timelines for certain opportunities delayed, which may negatively impact the time for us to reach positive cash flows from operations.

We believe we currently have sufficient financial resources to fund our operating expenses, working capital, and capital expenditure requirements for a period of at least twelve months from the date of this Quarterly Report on Form 10-Q.

Our plans for the use of cash in the long term (beyond twelve months from this Quarterly Report on Form 10-Q) are primarily related to funding operating expenses to support the commercialization of our products.

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Cash Flow Summary

Six months ended June 30,

Nine months ended September 30,

(in thousands)

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Operating Activities

For the six months ended June 30, 2025, net cash used in operating activities was $14,158.

Factors affecting our operating cash flows during this period were net loss of $17,286, a gain on termination of an operating lease of $1,612, and change in fair value of convertible notes and warrant liabilities of $87, partially offset by stock-based compensation of $3,661, debt issuance costs of $2,020, and common stock purchase agreement costs of $306.

For the nine months ended September 30, 2025, net cash used in operating activities was $20,247.

Factors affecting operating cash flows during this period were net loss of $26,616, a gain on termination of an operating lease of $1,014, partially offset by stock-based compensation of $4,732, change in fair value of convertible notes and warrant liabilities of $2,123, debt issuance costs of $2,020, and common stock purchase agreement costs of $325.

Within operating activities, the net changes in operating assets and liabilities were cash used of $1,869, primarily driven by decreases in accrued expenses and other liabilities and operating lease liabilities of $804 and $1,574, respectively.

Cash used was offset by cash provided by decreases in prepaid and other current assets and other noncurrent assets of $92 and $187, respectively, and an increase in accounts payable of $800.

For the six months ended June 30, 2024, net cash used in operating activities was $14,241.

Factors affecting our operating cash flows during this period were a net loss of $18,206, amortization of premiums and accretion of discounts on marketable securities, net of $428, offset by stock-based compensation of $4,754, and noncash lease expense of $727.

For the nine months ended September 30, 2024, net cash used in operating activities was $21,814.

Factors affecting operating cash flows during this period were a net loss of $26,912, a gain on termination of an operating lease, net, of $680, amortization of premiums and accretion of discounts on marketable securities, net of $491, offset by stock-based compensation of $7,002, common stock purchase agreement costs of $1,136, and noncash lease expense of $905.

Within operating activities, the net changes in operating assets and liabilities were cash used of $3,048, primarily driven by decreases in accrued expenses and other liabilities, operating lease liabilities, and other noncurrent liabilities of $3,411, $936, and $346, respectively.

Cash used was offset by cash provided by a decrease in prepaid and other current assets of $724 and an increase in accounts payable of $108.

Cash used was offset by cash provided by a decrease in prepaid and other current assets, inventories, and other noncurrent assets of $1,035, $157, and $123 respectively, and an increase in accounts payable of $275.

Investing Activities

For the six months ended June 30, 2025, net cash used in investing activities was $4,686.

For the nine months ended September 30, 2025, net cash used in investing activities was $29,167.

The primary factors affecting net cash used in investing activities during this period were the purchases of marketable securities of $44,989, partially offset by redemptions and maturities of marketable securities of $15,874.

For the six months ended June 30, 2024, net cash provided by investing activities was $2,993.

For the nine months ended September 30, 2024, net cash provided by investing activities was $3,140.

The primary factors affecting net cash provided by investing activities during this period were the proceeds from redemptions and maturities of marketable securities of $27,756, partially offset by the purchases of marketable securities of $24,241 and purchases of property and equipment of $420.

Financing Activities

For the six months ended June 30, 2025, net cash provided by financing activities was $10,952.

The primary factors affecting our financing cash flows during this period were proceeds from common stock purchase agreements of $10,076 and from the issuance of a convertible note of $2,950, partially offset by payments on convertible note of $750, payments of debt issuance costs of $608, taxes paid on net settlement of equity awards of $364 and payments of stock issuance costs related to common stock purchase agreements of $404.

For the six months ended June 30, 2024, net cash used in financing activities was $5,531.

The primary factors affecting our financing cash flows during this period were proceeds from the exercise of the common stock purchase agreement of $5,560, partially offset by payments for taxes related to net settlement of equity awards of $47.

For the nine months ended September 30, 2025, net cash provided by financing activities was $82,183.

The primary factors affecting financing cash flows during this period were proceeds from common stock purchase agreements of $80,988, the issuance of a convertible note of $2,950, and proceeds from the exercise of warrants of $1,788, partially offset by payments on convertible note of $989, payments of debt issuance costs of $658, taxes paid on net settlement of equity awards of $499, and payments of stock issuance costs related to common stock purchase agreements of $1,449.

For the nine months ended September 30, 2024, net cash used in financing activities was $5,443.

The primary factors affecting our financing cash flows during this period were proceeds from the exercise of the common stock purchase agreement of $5,863, partially offset by stock issuance costs related to common stock purchase agreements of $613.

Critical Accounting Estimates

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We believe our critical accounting estimates involve the greatest degree of judgment and complexity and have the greatest potential impact on our condensed consolidated financial statements.

During the six months ended June 30, 2025, there were no significant changes in our critical accounting estimates as compared to those previously disclosed in “Critical Accounting Policies and Estimates” in “Management's Discussion and Analysis of Financial Condition and Results of Operations” included in our 2024 Annual Report on Form 10-K.

During the nine months ended September 30, 2025, there were no significant changes in our critical accounting estimates as compared to those previously disclosed in “Critical Accounting Policies and Estimates” in “Management's Discussion and Analysis of Financial Condition and Results of Operations” included in our 2024 Annual Report on Form 10-K.

Emerging Growth Company Status

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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