IMPINJ INC, 10-K filed on 2/12/2024
Annual Report
v3.24.0.1
Document and Entity Information - USD ($)
$ in Billions
 12 Months Ended
Dec. 31, 2023
Feb. 02, 2024
Jun. 30, 2023
Document Information [Line Items]      
Document Type 10-K    
Amendment Flag false    
Document Period End Date Dec. 31, 2023    
Document Fiscal Year Focus 2023    
Document Fiscal Period Focus FY    
Trading Symbol PI    
Entity Registrant Name IMPINJ, INC.    
Entity Central Index Key 0001114995    
Current Fiscal Year End Date --12-31    
Entity Well-known Seasoned Issuer No    
Entity Current Reporting Status Yes    
Entity Voluntary Filers No    
Entity Filer Category Large Accelerated Filer    
Entity Shell Company false    
Entity Emerging Growth Company false    
ICFR Auditor Attestation Flag true    
Document Financial Statement Error Correction [Flag] false    
Entity Small Business false    
Entity Common Stock, Shares Outstanding   27,197,698  
Entity Public Float     $ 2.1
Entity Interactive Data Current Yes    
Title of 12(b) Security Common Stock, $0.001 par value per share    
Security Exchange Name NASDAQ    
Entity File Number 001-37824    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 91-2041398    
Entity Address, Address Line One 400 Fairview Avenue North    
Entity Address, Address Line Two Suite 1200    
Entity Address, City or Town Seattle    
Entity Address, State or Province WA    
Entity Address, Postal Zip Code 98109    
City Area Code 206    
Local Phone Number 517-5300    
Document Annual Report true    
Document Transition Report false    
Auditor Name Ernst & Young LLP    
Auditor Firm ID 42    
Auditor Location Seattle, Washington    
Documents Incorporated by Reference

DOCUMENTS INCORPORATED BY REFERENCE

The information required by Part III of this report, to the extent not set forth herein, is incorporated in this report by reference to the registrant’s definitive proxy statement relating to its 2024 annual meeting of stockholders. The definitive proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2023.

    
v3.24.0.1
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Current assets:    
Cash and cash equivalents $ 94,793 $ 19,597
Short-term investments 18,440 154,148
Accounts receivable, net of allowances of $827 and $755 at December 31, 2023 and 2022, respectively 54,919 49,996
Inventory 97,172 46,397
Prepaid expenses and other current assets 4,372 5,032
Total current assets 269,696 275,170
Long-term investments   19,200
Property and equipment, net 44,891 39,027
Intangible assets, net 13,913  
Operating lease right-of-use assets 9,735 10,490
Other non-current assets 1,478 1,969
Goodwill 19,696 3,881
Total assets 359,409 349,737
Current liabilities:    
Accounts payable 8,661 25,024
Accrued compensation and employee related benefits 8,519 9,048
Accrued and other current liabilities 8,614 2,925
Current portion of operating lease liabilities 3,373 3,122
Current portion of deferred revenue 1,713 2,250
Total current liabilities 30,880 42,369
Long-term debt 281,855 280,244
Operating lease liabilities, net of current portion 9,360 11,066
Deferred tax liabilities, net 2,911 118
Deferred revenue, net of current portion 272 349
Total liabilities 325,278 334,146
Commitments and contingencies (Note 12)
Stockholders' equity:    
Preferred stock, $0.001 par value - 5,000 shares authorized, no shares issued and outstanding at December 31, 2023 and 2022
Common stock, $0.001 par value - 495,000 shares authorized, 27,166 and 26,098 shares issued and outstanding at December 31, 2023 and 2022, respectively 27 26
Additional paid-in capital 463,900 403,599
Accumulated other comprehensive income (loss) 355 (1,249)
Accumulated deficit (430,151) (386,785)
Total stockholders' equity 34,131 15,591
Total liabilities and stockholders' equity $ 359,409 $ 349,737
v3.24.0.1
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Statement of Financial Position [Abstract]    
Accounts receivable, allowances $ 827 $ 755
Preferred stock, par value $ 0.001 $ 0.001
Preferred stock, shares authorized 5,000,000 5,000,000
Preferred stock, shares issued 0 0
Preferred stock, shares outstanding 0 0
Common stock, par value $ 0.001 $ 0.001
Common stock, shares authorized 495,000,000 495,000,000
Common stock, shares issued 27,166,000 26,098,000
Common stock, shares outstanding 27,166,000 26,098,000
v3.24.0.1
Consolidated Statements of Operations - USD ($)
shares in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Income Statement [Abstract]      
Revenue $ 307,539,000 $ 257,800,000 $ 190,283,000
Cost of revenue 155,557,000 119,916,000 91,329,000
Gross profit 151,982,000 137,884,000 98,954,000
Operating expenses:      
Research and development 88,562,000 74,106,000 64,058,000
Sales and marketing 41,123,000 37,894,000 34,287,000
General and administrative 60,828,000 45,465,000 36,137,000
Amortization of intangible assets 4,953,000 0  
Restructuring costs   (102,000) 1,721,000
Total operating expenses 195,466,000 157,363,000 136,203,000
Loss from operations (43,484,000) (19,479,000) (37,249,000)
Other income, net 4,644,000 2,517,000 25,000
Induced conversion expense   (2,232,000) (11,333,000)
Interest expense (4,848,000) (4,923,000) (2,550,000)
Loss before income taxes (43,688,000) (24,117,000) (51,107,000)
Income tax benefit (expense) 322,000 (184,000) (153,000)
Net loss $ (43,366,000) $ (24,301,000) $ (51,260,000)
Net loss per share basic $ (1.62) $ (0.95) $ (2.12)
Net loss per share diluted $ (1.62) $ (0.95) $ (2.12)
Weighted-average shares outstanding basic 26,752 25,539 24,176
Weighted-average shares outstanding diluted 26,752 25,539 24,176
v3.24.0.1
Consolidated Statements of Comprehensive Loss - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Statement of Comprehensive Income [Abstract]      
Net loss $ (43,366) $ (24,301) $ (51,260)
Other comprehensive income (loss), net of tax:      
Unrealized loss on investments 1,198 (1,210) (42)
Foreign currency translation adjustment 406    
Total other comprehensive income (loss) 1,604 (1,210) (42)
Comprehensive loss $ (41,762) $ (25,511) $ (51,302)
v3.24.0.1
Consolidated Statements of Changes in Stockholders' Equity - USD ($)
shares in Thousands, $ in Thousands
Total
Cumulative-effect Adjustment from Adoption of ASU 2020-06
Common Stock
Additional Paid-In Capital
Additional Paid-In Capital
Cumulative-effect Adjustment from Adoption of ASU 2020-06
Accumulated Deficit
Accumulated Deficit
Cumulative-effect Adjustment from Adoption of ASU 2020-06
Accumulated Other Comprehensive Income (loss)
Beginning balance at Dec. 31, 2020 $ 109,119 $ (29,301) $ 23 $ 423,759 $ (32,743) $ (314,666) $ 3,442 $ 3
Beginning balance, shares at Dec. 31, 2020     23,350          
Issuance of common stock 17,648   $ 2 17,646        
Issuance of common stock, shares     1,387          
Stock-based compensation 40,498     40,498        
Induced conversion on 2019 Notes (Note 8) (97,738)     (97,738)        
Net loss (51,260)         (51,260)    
Other comprehensive loss (42)             (42)
Ending balance at Dec. 31, 2021 (11,076)   $ 25 351,422   (362,484)   (39)
Ending balance, shares at Dec. 31, 2021     24,737          
Issuance of common stock 15,416   $ 1 15,415        
Issuance of common stock, shares     1,361          
Stock-based compensation 42,443     42,443        
Induced conversion on 2019 Notes (Note 8) (5,681)     (5,681)        
Net loss (24,301)         (24,301)    
Other comprehensive loss (1,210)             (1,210)
Ending balance at Dec. 31, 2022 15,591   $ 26 403,599   (386,785)   (1,249)
Ending balance, shares at Dec. 31, 2022     26,098          
Issuance of common stock 8,737   $ 1 8,736        
Issuance of common stock, shares     1,041          
Stock-based compensation 47,986     47,986        
Net loss (43,366)         (43,366)    
Equity issuance for Voyantic acquisition 3,579     3,579        
Equity issuance for Voyantic acquisition, shares     27          
Other comprehensive loss 1,604             1,604
Ending balance at Dec. 31, 2023 $ 34,131   $ 27 $ 463,900   $ (430,151)   $ 355
Ending balance, shares at Dec. 31, 2023     27,166          
v3.24.0.1
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Operating activities:      
Net loss $ (43,366) $ (24,301) $ (51,260)
Adjustments to reconcile net loss to net cash provided by operating activities:      
Depreciation and amortization 13,623 6,044 4,602
Stock-based compensation 47,986 42,443 40,498
Accretion of discount or amortization of premium on investments (1,637) (233) 896
Amortization of debt issuance costs 1,611 1,601 568
Loss on fixed asset disposal   57  
Induced conversion expense related to convertible notes   2,232 11,333
Settlement and related costs     (460)
Deferred tax expense (931) 6 8
Revaluation of acquisition-related contingent consideration liability 1,570    
Changes in operating assets and liabilities, net of amounts acquired:      
Accounts receivable (3,713) (14,547) (10,446)
Inventory (49,577) (24,439) 14,371
Prepaid expenses and other assets 1,625 852 (770)
Accounts payable (12,303) 7,371 2,340
Accrued compensation and employee related benefits (1,119) 2,683 836
Accrued and other liabilities (591) (215) 987
Operating lease right-of-use assets 2,607 3,414 2,792
Operating lease liabilities (3,308) (4,126) (3,528)
Deferred revenue (1,859) 1,805 (6,294)
Net cash provided by (used in) operating activities (49,382) 641 6,465
Investing activities:      
Purchases of investments   (205,749) (84,412)
Proceeds from sales of investments 13,372    
Proceeds from maturities of investments 144,401 114,750 82,000
Proceeds from sale of property and equipment 234 279  
Purchases of intangible assets (250)    
Purchases of property and equipment (18,592) (12,079) (16,230)
Business acquisitions, net of cash acquired (23,357)    
Net cash provided by (used in) investing activities 115,808 (102,799) (18,642)
Financing activities:      
Principal payments on finance lease obligations     (2)
Proceeds from exercise of stock options and employee stock purchase plan 8,736 15,416 17,648
Net cash provided by (used in) financing activities 8,736 (2,148) 112,444
Effect of exchange rate changes on cash and cash equivalents 34    
Net increase (decrease) in cash and cash equivalents 75,196 (104,306) 100,267
Cash and cash equivalents      
Beginning of period 19,597 123,903 23,636
End of period 94,793 19,597 123,903
Supplemental disclosure of cashflow information:      
Cash paid for interest 3,234 3,420 1,559
Purchases of property and equipment not yet paid 1,417 6,245 417
Operating lease liabilities arising from obtaining ROU assets 979    
Lease liabilities arising from remeasurement of ROU assets 159    
26,396 shares of common stock issued for Voyantic Oy acquisition 3,579    
Acquisition-related contingent consideration liability 6,172    
Disposal of fully depreciated property and equipment $ 3,855 199 4,467
2019 Notes      
Financing activities:      
Payment of 2019 Notes   $ (17,564) (183,624)
2021 Notes      
Financing activities:      
Proceeds from issuance of 2021 Notes, net of issuance costs     $ 278,422
v3.24.0.1
Consolidated Statements of Cash Flows (Parenthetical)
Dec. 31, 2023
shares
Common stock, shares issued 27,166,000
Voyantic Oy  
Common stock, shares issued 26,396
v3.24.0.1
Pay vs Performance Disclosure - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Pay vs Performance Disclosure      
Net Income (Loss) $ (43,366) $ (24,301) $ (51,260)
v3.24.0.1
Insider Trading Arrangements
 3 Months Ended
Dec. 31, 2023
shares
Trading Arrangements, by Individual  
Material Terms of Trading Arrangement

During our last fiscal quarter, no director or officer, as defined in Rule 16a-1(f), adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” each as defined in Item 408 of Regulation S-K, except as follows:

Name and Title

 

Character of Trading Arrangement (1)

 

Date Adopted

 

Date Terminated

 

Duration (2)

 

Aggregate Number of Shares of Common Stock to be Purchased or Sold Pursuant to Trading Arrangement

Chris Diorio, Chief Executive Officer and Vice Chair

 

Rule 10b5-1 Trading Arrangement

 

November 6, 2023

 

-

 

August 14, 2024

 

Up to 20,000

Jeff Dossett, 'Chief Revenue Officer

 

Rule 10b5-1 Trading Arrangement

 

October 28, 2022

 

October 27, 2023

 

February 9, 2024

 

Up to 45,500

 

 

Rule 10b5-1 Trading Arrangement

 

December 13, 2023

 

-

 

September 16, 2024

 

Up to 12,000

Hussein Mecklai, 'Chief Operating Officer

 

Rule 10b5-1 Trading Arrangement

 

March 9, 2023

 

October 27, 2023

 

June 5, 2024

 

Up to 30,319

(1) Except as indicated by footnote, each trading arrangement marked as a “Rule 10b5-1 Trading Arrangement” is intended to satisfy the affirmative defense of Rule 10b5-1(c), as amended (the “Rule”).

(2) Except as indicated by footnote, each trading arrangement permits transactions through and including the earlier of (a) the execution or expiration of all trades specified under the trading arrangement or (b) the date listed in the table. Each trading arrangement marked as a “Rule 10b5-1 Trading Arrangement” only permits transactions upon expiration of the applicable mandatory cooling-off period under the Rule.
Rule 10b5-1 Trading Plan | Chris Diorio  
Trading Arrangements, by Individual  
Name Chris Diorio
Title Chief Executive Officer and Vice Chair
Rule 10b5-1 Arrangement Adopted true
Adoption Date November 6, 2023
Aggregate Available 20,000
Trd Arr Expiration Date August 14, 2024
Rule 10b5-1 Trading Plan | Jeff Dossett One  
Trading Arrangements, by Individual  
Name Jeff Dossett
Title Chief Revenue Officer
Rule 10b5-1 Arrangement Adopted true
Adoption Date October 28, 2022
Rule 10b5-1 Arrangement Terminated true
Termination Date October 27, 2023
Aggregate Available 45,500
Trd Arr Expiration Date February 9, 2024
Rule 10b5-1 Trading Plan | Jeff Dossett Two  
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted true
Adoption Date December 13, 2023
Aggregate Available 12,000
Trd Arr Expiration Date September 16, 2024
Rule 10b5-1 Trading Plan | Hussein Mecklai  
Trading Arrangements, by Individual  
Name Hussein Mecklai
Title Chief Operating Officer
Rule 10b5-1 Arrangement Adopted true
Adoption Date March 9, 2023
Rule 10b5-1 Arrangement Terminated true
Termination Date October 27, 2023
Aggregate Available 30,319
Trd Arr Expiration Date June 5, 2024
v3.24.0.1
Description of Business
 12 Months Ended
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business

Note 1. Description of Business

Impinj, Inc., a Delaware corporation, is headquartered in Seattle, Washington. The Impinj platform wirelessly connects items and delivers data about the connected items to business and consumer applications. Impinj generates revenue from enterprise solutions that use our platform's constituent elements — endpoint ICs, reader ICs, readers, gateways, and test and measurement solutions — as well as from development, service and license agreements.

v3.24.0.1
Summary of Significant Accounting Policies
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies

Note 2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements include Impinj, Inc. and its wholly owned subsidiaries. We have eliminated intercompany balances and transactions in consolidation. We have prepared these consolidated financial statements in conformity with U.S. generally accepted accounting principles, or GAAP.

All numbers in the consolidated financial statements are rounded to the nearest thousand, except for per share data, and numbers in the notes to the consolidated financial statements are rounded to the nearest million.
 

Use of Estimates

Preparing financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and related disclosures as of the date of the financial statements, as well as the reported revenue and expenses during the periods presented. We evaluate our estimates on an ongoing basis, including those related to revenue recognition, sales incentives, the fair value of asset acquired, liabilities assumed, contingent consideration in business combinations, inventory excess and obsolescence, income taxes and fair value of stock awards. To the extent there are material differences between our estimates, judgments or assumptions and actual results, our financial statements will be affected.

Concentrations of Credit Risk

Financial instruments, which potentially subject us to credit-risk concentration, comprise primarily cash equivalents, investments and accounts receivable. We place our cash and cash equivalents and investments with major financial institutions, which management assesses to be of high credit quality, to limit our investment exposure. We extend credit to customers based on our evaluation of the customer’s financial condition and generally do not require collateral. The following tables present total revenue and accounts receivable concentration for the indicated periods as of the dates presented:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Revenue:

 

 

 

 

 

 

Avery Dennison

 

 

33

%

 

 

28

%

 

 

32

%

Arizon

 

 

11

 

 

 

10

 

 

 

11

 

 

 

44

%

 

 

38

%

 

 

43

%

 

 

As of December 31,

 

 

2023

 

 

2022

 

Accounts Receivable:

 

 

 

 

Avery Dennison

 

 

39

%

 

 

24

%

Arizon

 

 

11

 

 

 

13

 

 

 

50

%

 

 

37

%

 

 

Concentration of Supplier Risk

We outsource the manufacturing and production of our hardware products to a small number of suppliers. We believe other suppliers could provide similar products on comparable terms if needed. However, a supplier change could delay manufacturing and cause a sales loss, which would adversely affect our operating results.

Cash and Cash Equivalents

Cash includes demand deposits with banks or financial institutions. Cash equivalents include short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present minimal risk of changes in value with changes in interest rates. Our cash equivalents are solely investments with an original or remaining maturity of three months or less at the date of purchase. We regularly maintain cash amounts exceeding federally insured limits at financial institutions.

Investments

Our investments comprise fixed income securities, including U.S. government securities, corporate notes and bonds, commercial paper and asset-backed securities. The contractual maturities of some of our available-for-sale, or AFS, debt securities exceed a year and are classified as long-term investments on our balance sheet. We carry AFS debt securities at fair value with unrealized gains and losses reported as a component of other comprehensive income (loss). Our investments are subject to a periodic impairment review. We recognize an impairment charge when a decline in fair value of an investment below the cost basis is determined to be other-than-temporary. Factors we consider in determining whether a loss is temporary include the extent and length of time the investment's fair value has been lower than its cost basis, the financial condition and near-term prospects of the investee, our intent to sell the security and whether or not we will be required to sell the security prior to the expected recovery of the investment's amortized cost basis. No such impairment changes were recorded during the years ended December 31, 2023, 2022 and 2021. See Note 3 tables for the cost or amortized cost, gross unrealized gains, gross unrealized losses and total estimated fair value of our financial assets as of December 31, 2023 and 2022.

Fair Value Measurement

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

•
Level 1 — Quoted prices in active markets for identical assets or liabilities.
•
Level 2 — Assets and liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities.
•
Level 3 — Unobservable inputs that are supported by little or no market activity; instruments valued based on the best available data, some of which are internally developed, and considers risk premiums that a market participant would require.

We do not have any financial assets or liabilities in Level 3 as of December 31, 2022 or at December 31, 2023, except for the liability for the earnout consideration related to the Voyantic Oy acquisition. We have classified this liability as such because we determined the fair value using significant unobservable inputs. See Note 3: Fair Value Measurements and Note 6: Goodwill and Intangible Assets.

We applied the following methods and assumptions in estimating our fair value measurements:

Cash Equivalents — Cash equivalents comprise highly liquid investments, including money market funds with original maturities of less than three months at the acquisition date. We record the fair value measurement of these assets based on quoted market prices in active markets.

Investments — Our investments comprise fixed income securities, which include U.S. government agency securities, corporate notes and bonds, commercial paper, treasury bills and asset-backed securities. The fair value measurement of these assets is based on observable market-based inputs or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means.

Long-term Debt —See Note 8 for the carrying amount and estimated fair value of the Notes.

Accounts Receivable and Allowances

Accounts receivable comprises amounts billed and currently due from customers, net of allowances for doubtful accounts, sales returns and price exceptions.

The allowance for doubtful accounts is our best estimate of the amount of probable lifetime-expected credit losses in existing accounts receivable and is determined based on our historical collections experience, age of the receivable, knowledge of the customer and the condition of the general economy and industry as a whole. We record changes in our estimate of the allowance for doubtful accounts through bad debt expense and write off the receivable and corresponding allowance when accounts are ultimately determined to be uncollectible. We include bad debt expense in general and administrative expenses. For the periods presented in this report, bad debt expense and the allowance for doubtful accounts were not material.

We derive most of our accounts receivable from sales to original equipment manufacturers, or OEMs, original design manufacturers, ODMs, solution providers, and distributors who are large, well-established companies. We do not have customers that represent a significant credit risk based on current economic conditions and past collection experience. Also, we have not had material past-due balances on our accounts receivable as of December 31, 2023 or 2022.

The allowance for sales returns and price exceptions is our best estimate based on our historical experience and currently available evidence. We record changes in our estimate of the allowance for sales returns and price exceptions through revenue, and relieve the allowance when we receive product returns or process claims for price exceptions. The following table summarizes our allowance for sales returns (in thousands):

 

 

Balance at Beginning of Year

 

 

Additional Reserve

 

 

Applied Sales Return

 

 

Balance at End of Year

 

Allowance for sales returns and price exceptions:

 

 

 

 

 

 

 

 

During year ended December 31, 2023

 

$

605

 

 

$

2,912

 

 

$

(2,840

)

 

$

677

 

During year ended December 31, 2022

 

 

947

 

 

 

1,899

 

 

 

(2,241

)

 

 

605

 

During year ended December 31, 2021

 

 

406

 

 

 

2,780

 

 

 

(2,239

)

 

 

947

 

 

Inventory

We state inventories at the lower of cost or estimated net realizable value using the average costing method, which approximates a first-in, first-out method. Inventories comprise raw materials, work-in-process and finished goods. We continuously assess our inventory value and write down its value for estimated excess and obsolete inventory. This evaluation includes an analysis of inventory on hand, current and forecasted demand, product development plans and market conditions. If future demand or market conditions are less favorable than our projections, or our product development plans change from current expectations, then a write-down of excess or obsolete inventory may be required and is reflected in cost of goods sold in the period the updated information is known.

Excess and obsolescence charges had an immaterial impact on our 2023 and 2022 gross margin. Sales of fully reserved inventory had a favorable net impact of 1.5% on our 2021 gross margin. The 2021 favorable net impact was primarily from sales of fully reserved inventory, primarily endpoint ICs and readers included in the excess and obsolescence charge recorded in 2020. Because of industry-wide wafer shortages and reader supply constraints in 2021 and 2020, we sold a significant portion of the reserved endpoint ICs and gateways in the year ended December 31, 2021.

Property and Equipment

We record property and equipment at cost and depreciate it using the straight-line method over the estimated useful lives of the related assets. The useful lives are as follows:

Category

 

Useful Life

 

 

Machinery and equipment

 

1 to 10 years

 

 

Computer equipment and software

 

3 to 5 years

 

 

Furniture and fixtures

 

3 to 7 years

 

 

Equipment acquired under finance leases

 

3 to 7 years

 

 

Leasehold improvements

 

Shorter of remaining lease term or expected useful life

We charge maintenance and repair costs to expense when incurred. We capitalize major improvements, which extend the useful life of the related asset. Upon disposal of a fixed asset, we record a gain or loss based on the differences between the proceeds received and the net book value of the disposed asset.

Other Assets

Other assets comprise primarily capitalized implementation costs from cloud computing arrangements and security deposits. We capitalize eligible costs associated with cloud computing arrangements over the term of the arrangement, plus reasonably certain renewals, and recognize those costs on a straight-line basis in the same line item in the consolidated statement of operations as the expense for fees associated with the cloud computing arrangement. Cloud computing arrangement costs, included in prepaid expenses and other current assets, were $0.4 million and $0.4 million, and other non-current assets were $1.4 million and $1.8 million, as of December 31, 2023 and 2022, respectively. Amortization expense associated with the cloud computing arrangements was $0.5 million for 2023, $0.4 million for 2022, and $0.2 million for 2021. We present cash flows related to capitalized implementation costs in cash flows used in operating activities.

Business combinations and intangible assets including goodwill

We account for business combinations using the acquisition method which involves allocating the purchase price paid to assets acquired and liabilities assumed at their acquisition-date fair values. The excess of the fair value of purchase consideration over the fair value of the identifiable assets and liabilities is recorded as goodwill. While we use our best estimates and assumptions to accurately estimate the fair value of assets acquired, liabilities assumed and the contingent consideration liability, our estimates are inherently uncertain. These estimates include, but are not limited to, estimates of future revenue, revenue growth rates, discount rates, underlying product or technology life cycles and expenses necessary to support the acquired technology, and estimated sales cycle for customer relationships. During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.

We review assumptions related to the fair value of the contingent consideration each reporting period until the contingency is satisfied. We recognize the change in fair value of the contingent consideration liability in “General and administrative” expense on the consolidated statements of operations for the period in which the fair value changes.

We assess the impairment of goodwill on an annual basis, during the fourth quarter, or otherwise when events or changes in circumstances indicate that goodwill may be impaired.

We amortize identifiable intangible assets with finite lives over their useful lives on a straight-line basis.

We expense acquisition-related costs, including advisory, legal, accounting, valuation and other similar costs in the periods in which the costs are incurred.

Revenue Recognition

We generate revenue primarily from sales of hardware products. We also generate revenue from software, extended warranties, enhanced maintenance, support services, and nonrecurring engineering, or NRE, development services, none of which are material.

We recognize revenue when we transfer control of the promised goods or services to our customers, which for hardware sales is generally at the time of product shipment as determined by agreed-upon shipping terms. We measure revenue based on the amount of consideration we expect to be entitled-to in exchange for those goods or services. We expect the period between when we transfer control of promised goods or services and when we receive payment to be one year or less, and that expectation is consistent with our historical experience. As such, we do not adjust our revenue for the effects of a significant financing component. We recognize any variable consideration, which comprises primarily sales incentives, as revenue reduction at the time of revenue recognition. We estimate sales incentives based on our historical experience and current expectations at the time of revenue recognition and update them at the end of each reporting period as additional information becomes available.

Our reader and gateway products are highly dependent on embedded software and cannot function without this embedded software. We account for the hardware and embedded software as a single performance obligation and recognize revenue when control is transferred.

Our customer contracts with multiple performance obligations generally include a combination of hardware products, extended warranty, enhanced maintenance and support services. For these contracts, we account for individual performance obligations separately if they are distinct. We allocate the transaction price to the separate performance obligations on a relative standalone selling-price basis. In instances where the standalone selling price is not directly observable, such as when we do not sell the product or service separately, we determine the standalone selling price using one, or a combination of, the adjusted market assessment or expected cost-plus margin. We defer amounts allocated to extended warranty and enhanced maintenance sold with our reader and gateway products and recognize them on a straight-line basis over the term of the arrangement, which is typically from one to three years. We defer amounts allocated to support services sold with our reader and gateway products and recognize them when we transfer control of the promised services to our customers.

For NRE development agreements that involve significant production, modification or customization of our products, we generally recognize revenue over the performance period using the cost-input method because it best depicts the transfer of services to the customer. We receive payments under these agreements based on a billing schedule. Contract assets relate to our conditional right to consideration for our completed performance under these agreements. We record accounts receivable when the right to consideration becomes unconditional. For the periods presented in this report, our contract assets, deferred revenue and the value of unsatisfied performance obligations for NRE development agreements are not material.

If a customer pays consideration before we transfer a good or service under the contract, then we classify those amounts as contract liabilities or deferred revenue. We recognize contract liabilities as revenue when we transfer control of the promised goods or services to our customers.

Payment terms typically range from 30 to 120 days. We present revenue net of sales tax in our consolidated statements of operations. We include shipping charges billed to customers in revenue and the related shipping costs in cost of revenue.

Practical Expedients and Exemptions: We expense sales commissions when incurred because we expect the amortization period to be one year or less. We record these costs within sales and marketing expenses. We do not disclose the value of unsatisfied performance obligations for (1) contracts with an original expected length of one year or less and (2) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

Product Warranties

We provide limited warranty coverage for most products, generally ranging from a period of 90 days to one year from the date of shipment. We record a liability for the estimated cost of these warranties based on historical

claims, product failure rates and other factors when we recognize the related revenue. We review these estimates periodically and adjust our warranty reserves when actual experience differs from historical estimates or when other information becomes available. The warranty liability primarily includes the anticipated cost of materials, labor and shipping necessary to repair or replace the product. Accrued warranty costs in 2023, 2022 and 2021 were not material.

Leases

We determine, at inception, whether an arrangement is or contains a lease. Right-of-use, or ROU, assets represent our right to use an identified asset for the lease term. Lease liabilities represent our obligation to make lease payments arising from the lease. We recognize operating lease ROU assets and liabilities at commencement date based on the present value of future lease payments over the lease term. We use an incremental borrowing rate in determining the present value of future lease payments because our operating leases do not provide an implicit rate. Our incremental borrowing rate is based on a credit-adjusted risk-free rate, which best approximates a secured rate over a similar term of lease. We recognize lease expense for lease payments on a straight-line basis over the lease term. Our lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. We expense variable lease costs on the consolidated statements of operations as incurred. Our lease agreements generally do not contain any residual value guarantees or restrictive covenants.

We have various noncancellable operating lease agreements for office, warehouse and research and development space in the U.S., China, Thailand, Brazil, Malaysia and Finland, with expiration dates from 2024 to 2029. Certain of these arrangements have free or escalating rent payment provisions and optional renewal and termination clauses that we factor into the classification and measurement of the lease when appropriate. These lease agreements typically include lease and non-lease components and are generally accounted for as a single lease component. We consider variable CAM expenses for real estate leases as non-lease components.

We do not record leases with an initial term of 12 months or less on our consolidated balance sheet; we instead recognize lease expense for these leases on a straight-line basis over the lease term.

Research and Development Costs

Research and development expense comprises primarily personnel expenses (salaries, benefits and other employee related costs) and stock-based compensation expense for our product-development personnel; external consulting and service costs; prototype materials; other new-product development costs; and an allocated portion of infrastructure costs which include occupancy, depreciation and software costs.

Foreign Currency

We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiary into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for this subsidiary are translated using rates that approximate those in effect during the period. We recognize gains and losses from these translations as a component of accumulated other comprehensive income (loss) in stockholders' equity. Our subsidiaries that use the U.S. dollar as their functional currency remeasure monetary assets and liabilities at exchange rates in effect at the end of each period, and non-monetary assets and liabilities at historical rates. We have included the gains or losses from foreign currency remeasurement in earnings.

Income Taxes

We use the asset and liability approach for accounting, which requires recognizing deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax bases. We measure deferred tax assets and liabilities using enacted tax rates expected to be in effect when the assets and liabilities are recovered or settled. We recognize the effects of a change in tax rates on deferred tax assets and liabilities in the year of the enactment date. We determine deferred tax assets, including historical net operating losses and deferred tax liabilities, based on temporary differences between the book and tax bases of the assets and liabilities. We believe that it is currently more likely than not that our deferred tax assets will not be realized and, as such, we have recorded a full valuation allowance for these assets. We evaluate the likelihood of our ability to realize deferred tax assets in future periods on a quarterly basis, and if evidence indicates we will be able to realize some or all of our deferred tax assets then we will revise our valuation allowance accordingly.

We use a two-step approach for evaluating uncertain tax positions. First, we evaluate recognition, which requires us to determine if the weight of available evidence indicates that a tax position is more likely than not to be sustained upon audit, including resolution of related appeals or litigation processes. If we consider a tax position more likely than not to be unsustained, then no benefits of the position are recognized. Second, we measure the uncertain tax position based on the largest amount of benefit which is more likely than not to be realized on effective settlement. This process involves estimating our actual current tax exposure, including assessing the risks associated with tax audits, together with assessing temporary differences resulting from the different treatment of items for tax and financial reporting purposes. If actual results differ from our estimates, then our net operating loss and credit carryforwards could be materially impacted.

Us realizing the benefits of the NOLs and credit carryforwards depends on sufficient taxable income in future years. We have established a valuation allowance against the carrying value of our deferred tax assets, as it is currently more likely than not we will be unable to realize these deferred tax assets. In addition, using NOLs and credits to offset future income subject to taxes may be subject to substantial annual limitations due to the “change in ownership” provisions of the Code and similar state provisions. Events that cause limitations in the amount of NOLs that we may use in any one year include, but are not limited to, a cumulative ownership change of more than 50%, as defined by Code Sections 382 and 383, over a three-year period. Using our NOLs and tax credit carryforwards could be significantly reduced if a cumulative ownership change of more than 50% has occurred in our past or occurs in our future.

Stock-Based Compensation

We have various equity award plans, or Plans for granting share-based awards to employees, consultants and non-employee Company directors. The Plans provide for granting several available forms of stock compensation such as stock option awards, restricted stock units, or RSUs, RSUs with performance conditions, or PSUs, and RSUs with market and service conditions, or MSUs and an employee stock purchase plan, or ESPP.

We measure stock-based compensation costs for all share-based awards at fair value on the measurement date, which is typically the grant date. We determine the fair value of stock options using the Black-Scholes option-pricing model, which considers, among other things, estimates and assumptions on the expected life of the options, stock price volatility and market value of the Company’s common stock. We determine the fair value of RSUs and PSUs based on the closing price of our common stock at grant date. Additionally, for awards with a market condition, we use a Monte Carlo simulation model to estimate grant date fair value, which takes into consideration the range of possible stock price of total stockholder return outcomes.

Net Loss per Share

We compute net loss per share by dividing net loss by the weighted-average number of shares of common stock outstanding. We have outstanding stock options, RSUs, PSUs, MSUs and an ESPP, each of which we include in our calculation of diluted net loss per share if their effect would be dilutive. We compute diluted net loss per share by considering all potential dilutive common stock equivalents outstanding for the period.

Upon us adopting Accounting Standard Update, or ASU, 2020-06 using the modified retrospective transition method on January 1, 2021, we applied the “if-converted” method for calculating any potential dilutive effect of the conversion of the 2019 and 2021 Notes on diluted net loss per share for the years ended December 31, 2023 and 2022. For more information about the 2019 and 2021 Notes, please refer to Note 8 to our consolidated financial statements.

Recently Adopted Accounting Standards

In August 2020, the Financial Statement Accounting Board, or FASB, issued guidance on debt with conversion and other options, or ASU 2020-06. This guidance eliminated the beneficial and cash-conversion accounting models for convertible instruments and amends the derivative scope exception for contracts in an entity’s own equity. Additionally, this guidance requires the application of the “if-converted” method to calculate the impact of convertible instruments on diluted earnings per share. We adopted ASU 2020-06 on January 1, 2021 using the modified retrospective transition method and accounted for our 2019 Notes on a whole-instrument basis. We recorded a $29.3 million increase to long-term debt, a $32.7 million decrease to additional paid-in capital and a $3.4 million decrease to accumulated deficit on January 1, 2021. Interest expense decreased for the year ended December 31, 2021 compared with the years ended December 31, 2020 and December 31, 2019, respectively, as we no longer separate an equity component of the 2019 Notes and incur amortization of debt discount. We had no changes to net deferred tax liabilities, due to the decrease in deferred tax liability being offset by a corresponding increase in valuation allowance upon adoption.

We present our consolidated financial statements as of and for the year ended December 31, 2021, under ASU 2020-06. We have not adjusted the comparative prior reporting periods and continue to report them in accordance with our historical accounting policy.

Recently Issued Accounting Standards Not Yet Adopted

In November 2023, the FASB released ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which amends reportable segment requirements, primarily through enhanced disclosures about significant segment expenses, including for public entities that have a single reportable segment. The standard is effective for fiscal years beginning after December 31, 2023 and interim periods within fiscal years beginning after December 31, 2024. We are currently evaluating any impact of this standard on our financial statement disclosures.

In December 2023, the FASB released ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which amends income tax disclosure requirements to enhance the transparency and decision usefulness for users of the financial statements. The standard is effective for fiscal years beginning after December 31, 2024. We are currently evaluating any impact of this standard on our financial statement disclosures.
v3.24.0.1
Fair Value Measurements
 12 Months Ended
Dec. 31, 2023
Fair Value Disclosures [Abstract]  
Fair Value Measurements

Note 3. Fair Value Measurements

The following table presents the balances of assets measured at fair value on a recurring basis, by level within the fair value hierarchy, as of the dates presented (in thousands):

 

 

 

December 31, 2023

 

 

December 31, 2022

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

78,661

 

 

$

—

 

 

$

—

 

 

$

78,661

 

 

$

14,620

 

 

$

—

 

 

$

—

 

 

$

14,620

 

Total cash equivalents

 

 

78,661

 

 

 

—

 

 

 

—

 

 

 

78,661

 

 

 

14,620

 

 

 

—

 

 

 

—

 

 

 

14,620

 

Short-term investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency securities

 

 

—

 

 

 

11,893

 

 

 

—

 

 

 

11,893

 

 

 

—

 

 

 

78,621

 

 

 

—

 

 

 

78,621

 

Corporate notes and bonds

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

26,953

 

 

 

—

 

 

 

26,953

 

Commercial paper

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

24,073

 

 

 

—

 

 

 

24,073

 

Treasury bill

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

11,359

 

 

 

—

 

 

 

11,359

 

Yankee bonds

 

 

—

 

 

 

1,951

 

 

 

—

 

 

 

1,951

 

 

 

—

 

 

 

1,939

 

 

 

—

 

 

 

1,939

 

Agency bonds

 

 

—

 

 

 

2,994

 

 

 

—

 

 

 

2,994

 

 

 

—

 

 

 

2,882

 

 

 

—

 

 

 

2,882

 

Asset-backed securities

 

 

—

 

 

 

1,602

 

 

 

—

 

 

 

1,602

 

 

 

—

 

 

 

8,321

 

 

 

—

 

 

 

8,321

 

Total short-term investments

 

 

—

 

 

 

18,440

 

 

 

—

 

 

 

18,440

 

 

 

—

 

 

 

154,148

 

 

 

—

 

 

 

154,148

 

Long-term investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency securities

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

13,462

 

 

 

—

 

 

 

13,462

 

Yankee bonds

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,869

 

 

 

—

 

 

 

1,869

 

Agency bonds

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

2,983

 

 

 

—

 

 

 

2,983

 

Asset-backed securities

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

886

 

 

 

—

 

 

 

886

 

Total long-term investments

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

19,200

 

 

 

—

 

 

 

19,200

 

Total

 

$

78,661

 

 

$

18,440

 

 

$

—

 

 

$

97,101

 

 

$

14,620

 

 

$

173,348

 

 

$

—

 

 

$

187,968

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition related contingent consideration liability

 

 

—

 

 

 

—

 

 

 

6,180

 

 

 

6,180

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total liabilities at fair value

 

$

—

 

 

$

—

 

 

$

6,180

 

 

$

6,180

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

The following table presents additional information about liabilities measured at fair value for which the Company utilizes Level 3 inputs to determine fair value as of December 31, 2023:

 

 

 

Year Ended December 31,

 

 

 

2023

 

Balance as of January 1

 

$

—

 

Addition of contingent consideration liability due to acquisition

 

 

4,602

 

Change in fair value of contingent consideration liability due to remeasurement

 

 

1,578

 

Balance as of December 31

 

$

6,180

 

We recorded the contingent consideration related to the Voyantic Oy acquisition at its fair value using unobservable inputs and used the Monte Carlo simulation option pricing framework, incorporating contractual terms and assumptions regarding financial forecasts, discount rates and volatility of forecasted revenue and gross margins. A decrease in estimated revenues and gross margins or an increase in the discount rate would decrease the fair value of the contingent consideration liability. The estimated revenues and gross margins are not interrelated inputs. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations is management's responsibility with the assistance of a third-party valuation specialist. During the year ended December 31, 2023, we remeasured the fair value of the contingent consideration liability based on updated inputs related to actual performance results and recorded an additional expense of $1.6 million in general and administrative expense on the consolidated statement of operations. As of December 31, 2023, the contingent consideration liability of $6.2 million is included in "Accrued expenses and other current liabilities" on the consolidated balance sheet.

We did not have any Level 3 assets nor did we measure any liabilities at fair value as of December 31, 2022.

We expect short-term investments to mature within 1 year of the reporting date. We expect long-term investments to mature between 1 and 2 years from the reporting date. See Note 8 for the carrying amount and estimated fair value of our convertible senior notes due 2027.

The following tables present the cost or amortized cost, gross unrealized gains, gross unrealized losses and total estimated fair value of our financial assets as of the dates presented (in thousands):

 

December 31, 2023

 

 

Cost or

 

 

Gross

 

 

Gross

 

 

Total Estimated

 

 

Amortized Cost

 

 

Unrealized Gains

 

 

Unrealized Losses

 

 

Fair Value

 

Description:

 

 

 

 

 

 

 

 

 

 

 

Money market funds

$

78,661

 

 

$

—

 

 

$

—

 

 

$

78,661

 

U.S. government agency securities

 

11,932

 

 

 

—

 

 

 

(39

)

 

 

11,893

 

Corporate notes and bonds

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Yankee bonds

 

1,956

 

 

 

—

 

 

 

(5

)

 

 

1,951

 

Commercial paper

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Treasury bill

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Agency bond

 

2,998

 

 

 

—

 

 

 

(4

)

 

 

2,994

 

Asset-backed securities

 

1,604

 

 

 

—

 

 

 

(2

)

 

 

1,602

 

Total

$

97,151

 

 

$

—

 

 

$

(50

)

 

$

97,101

 

 

 

December 31, 2022

 

 

Cost or

 

 

Gross

 

 

Gross

 

 

Total Estimated

 

 

Amortized Cost

 

 

Unrealized Gains

 

 

Unrealized Losses

 

 

Fair Value

 

Description:

 

 

 

 

 

 

 

 

 

 

 

Money market funds

$

14,620

 

 

$

—

 

 

$

—

 

 

$

14,620

 

U.S. government agency securities

 

93,065

 

 

 

—

 

 

 

(982

)

 

 

92,083

 

Corporate notes and bonds

 

27,133

 

 

 

6

 

 

 

(186

)

 

 

26,953

 

Yankee bonds

 

3,815

 

 

 

—

 

 

 

(7

)

 

 

3,808

 

Commercial paper

 

24,073

 

 

 

—

 

 

 

—

 

 

 

24,073

 

Treasury bill

 

11,361

 

 

 

2

 

 

 

(4

)

 

 

11,359

 

Agency bond

 

5,863

 

 

 

4

 

 

 

(2

)

 

 

5,865

 

Asset-backed securities

 

9,287

 

 

 

2

 

 

 

(82

)

 

 

9,207

 

Total

$

189,217

 

 

$

14

 

 

$

(1,263

)

 

$

187,968

 

Marketable securities in a continuous loss position for less than 12 months had an estimated fair value of $10.2 million and unrealized losses of $0.02 million as of December 31, 2023. Marketable securities in a continuous loss position for less than 12 months had an estimated fair value of $125.6 million and unrealized losses of $1.2 million as of December 31, 2022. Marketable securities in a continuous loss position for greater than 12 months had an estimated fair value of $8.2 million and unrealized losses of $0.03 million as of December 31, 2023. Marketable securities in a continuous loss position for greater than 12 months had an estimated fair value of $13.9 million and unrealized losses of $0.1 million as of December 31, 2022.

Unrealized losses from our fixed-income securities are primarily attributable to changes in interest rates and not to lower credit ratings of the issuers. In determining whether an unrealized loss is other-than-temporary, for the

periods presented, we determined we do not have plans to sell the securities nor is it more likely than not that we would be required to sell the securities before their anticipated recovery.
v3.24.0.1
Inventory
 12 Months Ended
Dec. 31, 2023
Inventory Disclosure [Abstract]  
Inventory

Note 4. Inventory

The following table presents the detail of inventories as of the dates presented (in thousands):

 

 

 

 

 

 

 

 

 

 

December 31, 2023

 

 

December 31, 2022

 

Raw materials

 

$

21,773

 

 

$

14,678

 

Work-in-process

 

 

42,217

 

 

 

14,525

 

Finished goods

 

 

33,182

 

 

 

17,194

 

Total inventory

 

$

97,172

 

 

$

46,397

 
v3.24.0.1
Property and Equipment
 12 Months Ended
Dec. 31, 2023
Property, Plant and Equipment [Abstract]  
Property and Equipment

Note 5. Property and Equipment

 

The following table presents property and equipment details as of the dates presented (in thousands):

 

 

 

 

 

 

 

 

December 31, 2023

 

 

December 31, 2022

 

Machinery and equipment

 

$

57,511

 

 

$

48,420

 

Computer equipment and software

 

 

3,012

 

 

 

3,308

 

Furniture and fixtures

 

 

1,333

 

 

 

1,303

 

Equipment acquired under finance leases

 

 

1,728

 

 

 

2,895

 

Leasehold improvements

 

 

12,966

 

 

 

10,684

 

Total property and equipment, gross

 

 

76,550

 

 

 

66,610

 

Less: Accumulated depreciation

 

 

(31,659

)

 

 

(27,583

)

Total property and equipment, net

 

$

44,891

 

 

$

39,027

 

 

Depreciation expense, which includes amortization of finance lease assets, was $8.7 million, $6.0 million and $4.6 million for the years ended December 31, 2023, 2022 and 2021, respectively. We did not acquire any property and equipment under finance leases for the years ended December 31, 2023 or 2022.
v3.24.0.1
Goodwill and Intangible Assets
 12 Months Ended
Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets

Note 6. Goodwill and Intangible Assets

 

On April 3, 2023, we acquired all of the outstanding equity of Voyantic Oy for an aggregate purchase price of $32.7 million. Our acquisition of Voyantic Oy adds label design, manufacturing and testing to our systems offerings, to advance the quality, reliability and readability of partner inlays. The consideration comprised (i) $3.6 million in shares of our common stock valued using the market price on the date of the acquisition, (ii) $4.6 million in deferred payments contingent upon revenue and gross margin performance over a one-year period from the acquisition date, and (iii) the remainder in cash paid at closing.

We recorded the assets acquired and liabilities assumed at their estimated fair values as of the acquisition date. We recorded the excess of the purchase price over the assets acquired and liabilities assumed as goodwill. The fair value of net assets acquired, goodwill, intangible assets and deferred tax liability were $2.4 million, $15.6 million $18.4 million and $3.7 million, respectively. The goodwill amount represents synergies we expect to realize from the business combination and assembled workforce. We allocated the goodwill to our one reporting unit and reportable segment. The acquired goodwill and intangible assets were not deductible for tax purposes.

The transaction-related costs for the acquisition were $1.7 million for the year ended December 31, 2023. In addition we revalued the contingent consideration subsequent to the acquisition date and recorded an additional $1.6 million. See Note 3. Fair Value Measures for additional information on the contingent consideration.

Transaction expenses and contingent consideration expense are included in general and administrative expense in the consolidated statements of operations.

This acquisition did not have a material impact on our reported revenue or net loss amounts for any period presented; therefore, we have not presented historical and pro forma disclosures.

The following table presents goodwill as of December 31, 2023 (in thousands):

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

Balance at beginning of period

 

$

3,881

 

 

$

3,881

 

Additions from acquisition

 

 

15,590

 

 

 

—

 

Foreign currency translation adjustment

 

 

225

 

 

 

—

 

   Total

 

$

19,696

 

 

$

3,881

 

 

As of December 31, 2023, intangible assets comprised of the following (in thousands):

 

 

 

Estimated Useful Life in Years

 

Gross Carrying Amount

 

 

Accumulated Amortization

 

 

Net

 

Definite-lived intangible assets:

 

 

 

 

 

 

 

 

 

 

 

   Backlog

 

0.25

 

$

773

 

 

$

(773

)

 

$

—

 

   Customer Relationships

 

1

 

 

3,698

 

 

 

(2,773

)

 

 

925

 

   Developed Technology

 

7.25

 

 

13,024

 

 

 

(1,348

)

 

 

11,676

 

   Patent

 

3

 

 

250

 

 

 

(38

)

 

 

212

 

   Tradename

 

8

 

 

1,214

 

 

 

(114

)

 

 

1,100

 

   Total definite-lived intangible assets (1)

 

 

 

 

18,959

 

 

 

(5,046

)

 

 

13,913

 

(1) Foreign intangible asset carrying amounts are affected by foreign currency translation

 

 

We amortize identifiable intangible assets with finite lives over their useful lives on a straight-line basis. The weighted-average life of our intangible assets is approximately six years. Amortization expense of intangible assets was $5.0 million for the year ended December 31, 2023.

We did not have an intangible asset balance for the year ending December 31, 2022.

As of December 31, 2023, the estimated intangible asset amortization expense for the next five years and thereafter is as follows:

 

Estimated Amortization

 

 

 

(in thousands)

 

2024

 

 

2,956

 

2025

 

 

2,032

 

2026

 

 

1,993

 

2027

 

 

1,948

 

2028

 

 

1,948

 

Thereafter

 

 

3,036

 

Total

 

$

13,913

 
v3.24.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes

Note 7. Income Taxes

We are subject to federal and state income taxes in the United States and foreign jurisdictions.

The following table presents U.S. and foreign components of income (loss) before income taxes (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

U.S.

 

$

(40,349

)

 

$

(24,508

)

 

$

(51,488

)

Foreign

 

 

(3,339

)

 

 

391

 

 

 

381

 

Loss before income taxes

 

$

(43,688

)

 

$

(24,117

)

 

$

(51,107

)

The following table presents the detail of income tax benefit (expense) for the periods presented (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Current:

 

 

 

 

 

 

U.S. - Federal

 

$

—

 

 

$

—

 

 

$

—

 

U.S. - State

 

 

(163

)

 

 

(68

)

 

 

(8

)

Foreign

 

 

(446

)

 

 

(110

)

 

 

(137

)

 

 

(609

)

 

 

(178

)

 

 

(145

)

Deferred:

 

 

 

 

 

 

 

 

 

U.S. - Federal

 

 

(53

)

 

 

5

 

 

 

(7

)

U.S. - State

 

 

—

 

 

 

(11

)

 

 

(1

)

Foreign

 

 

984

 

 

 

—

 

 

 

—

 

 

 

931

 

 

 

(6

)

 

 

(8

)

Total income tax expense

 

$

322

 

 

$

(184

)

 

$

(153

)

We have not recorded a liability for U.S. income taxes and foreign withholding taxes on the undistributed earnings of foreign subsidiaries as of December 31, 2023 because we intend to permanently reinvest the earnings outside the United States. We expect the amount of the unrecognized deferred tax liability, if incurred, to be immaterial.

The following table presents a reconciliation of the federal statutory rate and our effective tax rate for the periods presented:

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

U.S. Statutory Rate

 

 

21.0

%

 

 

21.0

%

 

 

21.0

%

Change in valuation allowance

 

 

(42.0

)

 

 

(54.7

)

 

 

(33.3

)

State taxes (net of federal benefit)

 

 

0.1

 

 

 

0.4

 

 

 

0.2

 

Federal research and development credit

 

 

18.6

 

 

 

16.5

 

 

 

8.5

 

Stock-based compensation

 

 

10.4

 

 

 

16.1

 

 

 

10.2

 

Inducement premium

 

 

—

 

 

 

5.0

 

 

 

(4.7

)

Unrecognized tax benefits

 

 

(4.7

)

 

 

(4.1

)

 

 

(2.1

)

Other, net

 

 

(2.8

)

 

 

(1.0

)

 

 

(0.1

)

Effective income tax rate

 

 

0.7

%

 

 

(0.8

%)

 

 

(0.3

%)

We continue to maintain a full valuation allowance against our net deferred tax assets in the U.S. but recognize deferred income tax expense (benefit) due to the change in the indefinite deferred tax liability related to goodwill, which is partially offset by indefinite tax attributes.

Deferred federal, state and foreign income taxes reflect the net tax impact of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and for tax purposes. The following

table presents the significant components of our deferred tax assets and liabilities as of the dates presented (in thousands):

 

 

 

 

 

 

 

December 31, 2023

 

 

December 31, 2022

 

Net operating loss carryforwards

 

$

49,228

 

 

$

53,157

 

Credit carryforwards

 

 

22,971

 

 

 

16,868

 

Capitalized research and development

 

 

32,988

 

 

 

17,072

 

Operating lease liabilities

 

 

2,569

 

 

 

3,011

 

Allowances

 

 

1,624

 

 

 

1,398

 

Deferred revenue

 

 

48

 

 

 

74

 

Stock-based compensation

 

 

6,351

 

 

 

6,041

 

Disallowed interest expense

 

 

—

 

 

 

676

 

Inventory cost capitalization

 

 

1,433

 

 

 

791

 

Deferred tax assets

 

 

117,211

 

 

 

99,088

 

Less: Valuation allowance

 

 

(114,040

)

 

 

(95,710

)

Net deferred tax assets

 

 

3,171

 

 

 

3,378

 

Deferred tax liability:

 

 

 

 

 

 

Goodwill

 

 

(823

)

 

 

(796

)

Depreciation and amortization

 

 

(3,326

)

 

 

(475

)

Operating lease ROU assets

 

 

(1,933

)

 

 

(2,226

)

Deferred tax liabilities

 

 

(6,082

)

 

 

(3,497

)

Net deferred tax liability

 

$

(2,911

)

 

$

(119

)

 

Realizing deferred tax assets depends on us generating future taxable income, the timing and amount of which are uncertain. We have provided a full valuation allowance against the net deferred tax assets as of December 31, 2023 and 2022 because, based on the weight of available evidence, it is more likely than not we will be unable to realize the deferred tax assets.

We acquired Voyantic Oy, a Finnish company on April 3, 2023. As a result of the transaction, we recorded a $3.7 million deferred tax liability associated with intangibles, with an offset to goodwill.

We have accumulated federal tax losses of approximately $230.5 million and $249.3 million, respectively, as of December 31, 2023 and 2022, which are available to reduce future taxable income. The Tax Cuts and Jobs Act, or TCJA, enacted on December 22, 2017 altered the carryforward period for federal net operating losses and as a result, all net operating losses generated in 2018 and forward have an indefinite life. Of the net operating losses reported, we have accumulated $141.9 million with an indefinite life as of December 31, 2023. We have accumulated state tax losses of approximately $21.3 million and $21.7 million as of December 31, 2023 and 2022, respectively. We also have net research and development credit carryforwards of $30.5 million and $22.3 million as of December 31, 2023 and 2022, respectively, which are available to reduce future tax liabilities.

The Tax Cuts and Jobs Act contained a provision which requires the capitalization of Section 174 costs incurred in the years beginning on or after Jan. 1, 2022. Section 174 costs are expenditures which represent research and development costs that are incident to the development or improvement of a product, process, formula, invention, computer software or technique. This provision changes the treatment of Section 174 costs such that the expenditures are no longer allowed as an immediate deduction but rather must be capitalized and amortized. We have included the impact of this provision, which results in a deferred tax asset of approximately $32.9 million as of December 31, 2023.

The pre-2018 federal and state tax losses and federal research and development credit carryforwards began expiring in 2020. Under Sections 382 and 383 of the Internal Revenue Code, if a corporation undergoes an ownership change, the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes, such as research tax credits, to offset its post-change income or income tax liability may be limited. We have completed a formal IRC Section 382 study through December 31, 2023 and the attributes disclosed in this footnote reflect the conclusion of that study. However, subsequent ownership changes may affect the limitation in future years.

We are currently not under audit in any tax jurisdiction. Tax years from 2004 through 2023 are currently open for audit by federal and state taxing authorities.

We establish reserves for tax positions based on estimates of whether, and the extent to which, additional taxes will be due. We establish the reserves when we believe that our tax-return positions might be challenged by taxing authorities, despite our belief that our tax return positions are fully supportable.

The following table presents the total balance of unrecognized tax benefits as of the dates presented (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Balance at beginning of period

 

$

5,606

 

 

$

4,609

 

 

$

3,519

 

Gross increase to tax positions in current periods

 

 

2,034

 

 

 

997

 

 

 

1,090

 

Balance at end of period

 

$

7,640

 

 

$

5,606

 

 

$

4,609

 

As of December 31, 2023, we recorded a total amount of unrecognized tax benefit of $7.6 million as a reduction to the deferred tax asset. If recognized, this tax benefit would have no impact to our effective tax rate because we have a full valuation allowance. We do not anticipate that the amount of existing unrecognized tax benefit will significantly increase or decrease within the next 12 months. We record accrued interest and penalties related to unrecognized tax benefits as income tax expense and their value is zero.
v3.24.0.1
Long-term Debt
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
Long-term Debt

Note 8. Long-term debt

In December 2019, we issued $86.3 million aggregate principal amount of the 2019 Notes and in November 2021, we issued $287.5 million aggregate principal amount of convertible promissory notes due May 15, 2027, referred to as the 2021 Notes (collectively, the Notes). The 2019 Notes were repurchased in 2021 and 2022. See further information on the 2019 Note Repurchase under "Repurchase of the Convertible Senior Notes - 2019" section below.

The following table presents the outstanding principal amount and carrying value of the 2021 Notes as of the dates indicated (in thousands):

 

 

 

December 31, 2023

 

 

December 31, 2022

 

 

 

Principal Amount

 

 

Unamortized debt issuance costs

 

 

Net Carrying Amount

 

 

Principal Amount

 

 

Unamortized debt issuance costs

 

 

Net Carrying Amount

 

2021 Notes

 

 

287,500

 

 

 

(5,645

)

 

 

281,855

 

 

 

287,500

 

 

 

(7,256

)

 

 

280,244

 

Further details of the 2021 Notes are as follows:

 

Issuance

 

Maturity Date

 

Interest Rate

 

First Interest Payment Date

 

Effective Interest Rate

 

Semi-Annual Interest Payment Dates

 

Initial Conversion Rate per $1,000 Principal

 

Initial Conversion Price

 

 

Number of Shares (in millions) (1)

2021 Notes

 

May 15, 2027

 

1.125%

 

May 15, 2022

 

1.72%

 

May 15; November 15

 

9.0061

 

$

111.04

 

 

2.6

 

The 2021 Notes are senior unsecured obligations, do not contain any financial covenants and are governed by indentures (the Indentures). The total net proceeds from the 2021 Notes, after deducting initial debt issuance costs, fees and expenses, was $278.4 million. We used approximately $183.6 million of the 2021 Notes net proceeds, excluding accrued interest, to repurchase approximately $76.4 million aggregate principal amount of the 2019 Notes through individual privately negotiated transactions concurrent with us offering the 2021 Notes. We used approximately $17.6 million, excluding accrued interest, to repurchase the remaining $9.9 million aggregate principal amount of the 2019 Notes in June 2022. We will use the remainder of the net proceeds from the 2021 Notes for general corporate purposes.

Terms of the 2021 Notes

The holders of the 2021 Notes may convert their respective 2021 Notes at their option at any time prior to the close of business on the business day immediately preceding the respective conversion dates under the following circumstances:

•
during any fiscal quarter commencing after the fiscal quarter ending on March 31, 2022 (and only during such fiscal quarter), if the last reported sale price of our common stock, for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day;
•
during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the 2021 Notes for each trading day was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day;
•
prior to the close of business on the second scheduled trading day immediately preceding the redemption date if we call the 2021 Notes for redemption; or
•
upon the occurrence of specified corporate events, as described in the indenture.

None of the circumstances described in the above paragraphs were met during fiscal year 2023.

Regardless of the foregoing circumstances, holders may convert all or any portion of the 2021 Notes, in increments of $1,000 principal amount, on or after February 15, 2027, until the close of business on the second scheduled trading day immediately preceding the maturity date.

We may redeem all or a portion of the 2021 Notes for cash, at our option, on or after November 20, 2024, if the last reported sale price of our common stock has been at least 130% of the conversion price at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period at a redemption price equal to 100% of the principal amount of the 2021 Notes being redeemed, plus any accrued and unpaid interest to, but excluding, the redemption date.

Holders who convert their 2021 Notes in connection with certain corporate events that constitute a make-whole fundamental change (as defined in the indenture) are, under certain circumstances, entitled to an increase in the conversion rate. Additionally in the event of a corporate event constituting a fundamental change (as defined in the indenture), holders of the 2021 Notes may require us to repurchase all or a portion of their 2021 Notes at a repurchase price equal to 100% of the principal amount of the 2021 Notes being repurchased, plus any accrued and unpaid interest to, but excluding, the repurchase date.

Accounting for the Notes

Prior to January 1, 2021, we separated the 2019 Notes into liability and equity components.

We determined the fair value of the liability component to be $52.5 million calculated as the present value of future cash flows discounted at the borrowing rate for a similar nonconvertible debt instrument based on the expected term. We determined the borrowing rate to be 9.90% based on the market rates for nonconvertible debt instruments issued by other companies with publicly available credit ratings considered to be comparable to us. We recognized the excess of the principal amount of the 2019 Notes over the initial carrying amount of the liability component as a debt discount of $33.8 million and amortized it to interest expense over the expected term of the 2019 Notes using the effective interest rate method. We recorded the equity component of $33.8 million as additional paid-in capital, calculated as the difference between the total proceeds of $86.3 million and the initial carrying amount of the liability component.

We allocated the 2019 Notes total issuance costs of $2.8 million between liability and equity in the same proportion as the allocation of our total proceeds to liability and equity components. We amortized the issuance costs attributable to the liability component of $1.7 million to interest expense over the respective term of the 2019 Notes using the effective interest rate method. We netted the issuance costs attributable to the equity component of $1.1 million against the respective equity component in additional paid-in capital.

Effective January 1, 2021, we early adopted ASU 2020-06 using the modified retrospective approach. As a result, we accounted for the 2019 Notes as a single liability measured at amortized cost, as no other embedded

features require bifurcation and recognition as derivatives. Upon adoption, we recorded a $29.3 million increase to long-term debt, a $32.7 million decrease to additional paid-in capital and a $3.4 million decrease to accumulated deficit. We had no changes to net deferred tax liabilities with a decrease in deferred tax liability offset by a corresponding increase in valuation allowance upon adoption.

We accounted for the 2021 Notes issuance as a single liability measured at its amortized cost, as no other embedded features require bifurcation and recognition as derivatives. We presented the 2021 Notes total issuance costs of $9.1 million as a direct deduction from the face amount of the 2021 Notes. We amortized the issuance costs to interest expense over the respective term of the 2021 Notes using the effective interest rate method.

Interest expense related to the Notes was as follows (in thousands):

 

 

Year Ended December 31, 2023

 

 

Year Ended December 31, 2022

 

 

Year Ended December 31, 2021

 

 

 

2021 Notes

 

 

2019 Notes

 

 

2021 Notes

 

 

Total

 

 

2019 Notes

 

 

2021 Notes

 

 

Total

 

Amortization of debt issuance costs

 

 

1,612

 

 

 

19

 

 

 

1,583

 

 

 

1,602

 

 

 

329

 

 

 

239

 

 

 

568

 

Cash interest expense

 

 

3,236

 

 

 

87

 

 

 

3,234

 

 

 

3,321

 

 

 

1,488

 

 

 

494

 

 

 

1,982

 

Total interest expense

 

$

4,848

 

 

$

106

 

 

$

4,817

 

 

$

4,923

 

 

$

1,817

 

 

$

733

 

 

$

2,550

 

Accrued interest related to the 2021 Notes as of December 31, 2023 and 2022 was $0.4 million and $0.4 million, respectively. We record accrued interest in accrued liabilities in our consolidated balance sheet.

Our estimated fair value of the 2021 Notes was $314.0 million and $347.4 million as of December 31, 2023 and 2022, respectively, which we determined through consideration of quoted market prices. The fair value for the 2021 Notes is classified as Level 2, as defined in Note 2.

Capped Calls

In connection with the issuance of the 2019 Notes, we entered into privately negotiated capped-call transactions with certain financial counterparties. The capped call transactions are generally designed to reduce the potential dilution to our common stock upon any conversion or settlement of the 2019 Notes, or to offset any cash payments we are required to make in excess of the principal amount upon conversion of the 2019 Notes, as the case may be, with the reduction or offset subject to a cap based on the cap price. If, however, the market price per share of our common stock exceeds the cap price of the capped-call transactions, then our stock would experience some dilution and/or the capped call would not fully offset the potential cash payments, in each case, to the extent then-market price per share of our common stock exceeds the cap price. The capped call remains outstanding even though we have repurchased the 2019 Notes, to reduce the potential dilution of the 2021 Notes. The initial cap price of the capped call transactions is $54.20 per share, subject to certain adjustments under the terms of the capped call transactions. The capped call transactions expire over 40 consecutive scheduled trading days ending on

December 11, 2026. The capped call transactions meet the criteria for classification in equity, are not accounted for as derivatives and are not remeasured each reporting period.

Repurchase of the Convertible Senior Notes – 2019

In November 2021 and June 2022, we completed a privately negotiated induced conversion of $76.4 million and $9.9 million principal amount, respectively of the 2019 Notes. We accounted for the 2019 Notes Repurchase transactions as induced conversions in accordance with Accounting Standards Codification 470-20, Debt with Conversion and Other Options (ASC 470-20). In connection with the induced conversions, we paid approximately $183.6 million in cash in November 2021 and $17.6 million in cash in June 2022, and also paid accrued and unpaid interest thereon. As a result of the induced conversion, we recorded $11.3 million in November 2021 and $2.2 million in June 2022 in induced conversion expense which is included in the Consolidated Statements of Operations. The induced conversion expense represents the fair value of the consideration issued upon conversion in excess of the fair value of the securities issuable under the original terms of the 2019 Notes. We accounted for the remaining cash consideration under the original terms of the 2019 Notes under the general conversion accounting guidance, where the difference between the carrying amount of the 2019 Notes retired, including unamortized debt issuance costs of $1.8 million in November 2021 and $0.2 million in June 2022, and the cash consideration paid, was recorded in additional paid-in capital.
v3.24.0.1
Stockholders' Equity
 12 Months Ended
Dec. 31, 2023
Statement of Stockholders' Equity [Abstract]  
Stockholders' Equity

Note 9. Stockholders’ Equity

Preferred Stock

Our board of directors has the authority to fix the designations, powers, preferences and rights and the qualifications, limitations or restrictions thereof, of any wholly unissued series of preferred stock, and to increase or decrease the number of shares in any series of preferred stock, subject to limitations prescribed by law and by our certificate of incorporation. We had no preferred stock issued and outstanding as of December 31, 2023 or 2022.

Common Stock

As of December 31, 2023, we had authorized 495,000,000 shares of voting $0.001 par value common stock. Each holder of the common stock is entitled to one vote per common share. At its discretion, the board of directors may declare dividends on shares of common stock, subject to the prior rights of our preferred stockholders, if any. Upon liquidation or dissolution, holders of common stock will receive distributions only after preferred stock preferences have been satisfied.
v3.24.0.1
Stock-Based Awards
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
Stock-Based Awards

Note 10. Stock-Based Awards

Stock-Based Compensation Expense

The following table presents the detail of stock-based compensation expense amounts included in our consolidated statements of operations for the periods presented (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Cost of revenue

$

1,869

 

 

$

1,522

 

 

$

1,869

 

Research and development expense

 

21,307

 

 

 

17,961

 

 

 

17,170

 

Sales and marketing expense

 

10,240

 

 

 

9,447

 

 

 

9,496

 

General and administrative expense

 

14,570

 

 

 

13,513

 

 

 

11,963

 

Total stock-based compensation expense

$

47,986

 

 

$

42,443

 

 

$

40,498

 

2016 Equity Incentive Plan

In June 2016, our board of directors adopted and our stockholders approved our 2016 Equity Incentive Plan, or the 2016 Plan, which became effective in July 2016 at which time the 2010 Equity Incentive Plan, or the 2010 Plan, was terminated. The number of shares of common stock reserved for issuance under the 2016 Plan may increase on January 1 of each year, beginning on January 1, 2017 and ending on and including January 1, 2026, by the lesser of (1) 1,825,000 shares; (2) 5% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; and (3) a lesser number of shares determined by our board of directors. The 2016

Plan provides for granting incentive or non-qualified stock options, restricted stock, restricted stock units, stock appreciation rights and performance shares or performance units to employees, non-employee directors and consultants.

All options granted under the 2010 Plan and the 2016 Plan have a maximum 10-year term and generally vest and become exercisable over four years of continued employment or service as defined in each option agreement. We generally grant stock options with exercise prices that equal the fair value of the common stock on the date of grant. As allowed under the 2016 Plan, there are a few exceptions to this vesting schedule, which permit vesting at different rates or based on achieving performance targets. We use newly issued shares to satisfy option exercises. As of December 31, 2023, we had approximately 2.8 million shares of common stock available for future grants.

Stock Options

We did not issue stock options in fiscal year 2023 or fiscal year 2022. The following table summarizes option award activity for the year ended December 31, 2023 (in thousands, except per share data and years):

 

 

Number of
Underlying Shares

 

 

Weighted-Average
Exercise Price
Per Share

 

 

Weighted-Average
Remaining
Contractual
Life (Years)

 

 

Total Intrinsic
Value

 

Outstanding at December 31, 2022

 

 

1,712

 

 

$

25.09

 

 

 

5.92

 

 

$

143,996

 

Granted

 

 

—

 

 

 

—

 

 

 

 

 

 

 

Exercised

 

 

(243

)

 

 

22.72

 

 

 

 

 

 

 

Forfeited or expired

 

 

(3

)

 

 

27.72

 

 

 

 

 

 

 

Outstanding at December 31, 2023

 

 

1,466

 

 

 

25.48

 

 

 

4.97

 

 

 

94,650

 

Vested and exercisable at December 31, 2023

 

 

1,408

 

 

$

25.35

 

 

 

4.91

 

 

$

91,089

 

 

We estimate the fair value of options granted at the date of grant using the Black-Scholes option-pricing model with the following assumptions for the periods presented:

 

 

Year Ended December 31,

 

 

 

2023

 

2022

 

2021

 

Risk-free interest rate

 

N/A

 

N/A

 

0.8% - 1.2%

 

Expected dividends yield

 

N/A

 

N/A

 

None

 

Expected volatility

 

N/A

 

N/A

 

71.2% - 72.4%

 

Weighted-average expected term

 

N/A

 

N/A

 

 

6.08

 

Weighted-average fair value of options granted

 

N/A

 

N/A

 

$

36.94

 

 

In 2021, we determined that it was not practicable to calculate the volatility of our share price because we do not have an extensive public trading history for shares of our common stock. Therefore, we estimated our volatility based on a combination of our historical volatility since becoming a publicly traded company and reported market value data for a group of publicly traded entities that we believe are relatively comparable after considering their size, stage of lifecycle, profitability, growth, risk and return on investment.

In 2021, to determine the expected term, we applied the simplified approach in which the expected term of an award is presumed to be the midpoint between the vesting date and the expiration date of the options as we did not have sufficient historical exercise data to provide a reasonable basis for an estimate of expected term.

The total intrinsic value of options exercised during 2023, 2022 and 2021 was $19.1 million, $31.9 million and $33.7 million, respectively. The total grant date fair value of options vested was $3.3 million, $7.0 million and $12.8 million during 2023, 2022 and 2021, respectively.

As of December 31, 2023, our total unrecognized stock-based compensation cost related to unvested stock options was $0.9 million, which we will recognize over the weighted-average remaining requisite service period of 0.5 years.

Restricted Stock Units

The following table summarizes activity for restricted stock units, or RSUs, PSUs, and MSUs for the year ended December 31, 2023 (in thousands, except per share data):

 

 

Number of Underlying Shares

 

 

Weighted-Average Grant Date Fair Value

 

 

 

RSUs

 

 

MSUs

 

 

PSUs

 

 

RSUs

 

 

MSUs

 

 

PSUs

 

Outstanding at December 31, 2022

 

 

 

1,310

 

 

 

110

 

 

 

74

 

 

$

56.92

 

 

$

80.40

 

 

$

64.03

 

Granted

 

 

 

441

 

 

 

126

 

 

 

—

 

 

 

119.12

 

 

 

145.51

 

 

 

—

 

Vested

 

 

 

(633

)

 

 

(58

)

 

 

(57

)

 

 

52.92

 

 

 

39.15

 

 

 

64.03

 

Forfeited

 

 

 

(40

)

 

 

(4

)

 

 

(17

)

 

 

71.49

 

 

 

185.49

 

 

 

64.03

 

Outstanding at December 31, 2023

 

 

 

1,078

 

 

 

174

 

 

 

—

 

 

$

84.18

 

 

$

138.77

 

 

$

—

 

We record stock-based compensation expense for RSUs and MSUs on a straight-line basis over the requisite service period, which is generally the vesting period. We record stock-based compensation for PSUs based on the probability of achieving the performance criteria defined in the PSU agreements. Forfeitures are recognized as they occur.

We granted PSUs under our annual bonus program to our senior executives and other bonus-eligible employees. The number of annual PSUs that ultimately vest depends on us attaining certain financial metrics for the fiscal year as well as on the employee’s continued employment through the vesting date. In fiscal year 2022, we transitioned to a bonus plan that was half cash and half PSUs. In fiscal year 2023, we transitioned to an all cash bonus plan.

The following table summarizes information related to granted and vested RSUs, PSUs, and MSUs (in thousands, except per share data):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

RSU weighted-average grant date fair value

$

119.12

 

 

$

65.81

 

 

$

56.40

 

MSU weighted-average grant date fair value

 

145.51

 

 

 

81.22

 

 

 

77.01

 

PSU weighted-average grant date fair value

$

—

 

 

$

64.07

 

 

$

54.67

 

 

 

 

 

 

 

 

 

 

Fair market value of RSUs vested

$

64,417

 

 

$

32,871

 

 

$

18,228

 

Fair market value of MSUs vested

 

7,219

 

 

 

—

 

 

 

—

 

Fair market value of PSUs vested

$

7,261

 

 

$

18,873

 

 

$

15,384

 

As of December 31, 2023, our total unrecognized stock-based compensation cost related to unvested MSUs was $13.7 million, which we will recognize over the weighted-average period of 1.3 years. As of December 31, 2023, there was $78.4 million of total unrecognized compensation cost related to unvested RSUs, which we expect to recognize over a weighted-average period of 2.4 years.

Employee Stock Purchase Plan

Effective July 2016, we adopted the 2016 Employee Stock Purchase Plan, or the ESPP, allowing eligible employees to authorize payroll deductions of up to 15% of their eligible compensation. An ESPP participant may purchase a maximum of 4,000 shares, or a lesser number as determined by the IRS rules, each six-month period. The offering periods generally start on the first trading day on or after February 20 and August 20 of each year. Participants in an offering period are granted the right to purchase common shares at a price per share that is 85% of the lesser of the fair market value of the shares on (1) the first day of the offering period or (2) the end of the purchase period. The number of shares reserved for the ESPP may increase each year, beginning on January 1, 2017 and continuing through and including January 1, 2036, by the lesser of: (1) 1% of the total number of shares of common stock outstanding on the first day of each year; (2) 365,411 shares of common stock; and (3) an amount determined by our board of directors.

As of December 31, 2023, the total unrecognized stock-based compensation from the ESPP was $0.3 million, which we will recognize on a straight-line basis over the weighted-average remaining service period of less than one year.

We estimate the fair value of the ESPP grant at the start of the offering period using the Black-Scholes option-pricing model with the following assumptions for the periods presented:

 

 

Year Ended December 31,

 

2023

 

2022

 

2021

Risk-free interest rate

 

5.1% - 5.6%

 

0.7% - 3.2%

 

0.0% - 0.1%

Expected term

 

0.5 Years

 

0.5 Years

 

0.5 Years

Expected volatility

 

64.7% - 85.9%

 

71.9% - 76.3%

 

61.0% - 65.8%

 
v3.24.0.1
Leases
 12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
Leases

Note 11. Leases

The following table presents the components of lease expense in our consolidated statements of operations for the periods presented (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Operating lease costs(1)

 

 

 

 

 

 

 

 

Single lease costs

$

3,486

 

 

$

4,299

 

 

$

4,154

 

Variable lease costs

 

1,280

 

 

 

2,159

 

 

 

1,910

 

Sublease income(2)

 

(165

)

 

 

(1,976

)

 

 

(1,900

)

Total operating lease costs

$

4,601

 

 

$

4,482

 

 

$

4,164

 

(1) Includes short-term lease costs, which are immaterial.

 

(2) Sublease income is related to unused office space that we sublet as part of the fiscal 2018 restructuring where we continue to have the primary obligations.

 

 

The following table presents supplemental cash flow information related to operating leases for the periods presented (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Cash paid for amounts included in the measurement of lease liabilities

 

 

 

 

 

 

 

 

Operating cash flows used

$

4,233

 

 

$

5,097

 

 

$

4,895

 

Lease liabilities arising from remeasurement of right-of-use assets

 

 

 

 

 

 

 

 

Operating leases

$

159

 

 

$

—

 

 

$

698

 

Lease liabilities arising from obtaining ROU assets

 

 

 

 

 

 

 

 

Operating leases

$

1,690

 

 

$

2,237

 

 

$

—

 

 

The following table presents weighted-average remaining lease term and weighted-average discount rate related to operating leases as of:

 

2023

 

 

2022

 

Weighted-average remaining lease term (years)

 

3.7

 

 

 

4.3

 

Weighted-average discount rate

 

6.9

%

 

 

6.9

%

 

 

The following table presents future lease payments under operating leases as of December 31, 2023 (in thousands):

 

 

Operating Leases

 

 

 

Lease Payments

 

2024

 

$

4,120

 

2025

 

 

4,129

 

2026

 

 

4,201

 

2027

 

 

775

 

2028

 

 

642

 

Thereafter

 

 

549

 

Total lease payments

 

$

14,416

 

Less: Imputed interest

 

 

(1,683

)

Present value of lease liabilities

 

 

12,733

 

Less: Current portion of lease liabilities

 

 

3,373

 

Lease liabilities, net of current portion

 

$

9,360

 
v3.24.0.1
Commitments and Contingencies
 12 Months Ended
Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

Note 12. Commitments and Contingencies

Indemnification

In the normal course of business, we may enter into agreements that require us to indemnify either customers or suppliers for certain risks. Although we cannot estimate our maximum exposure under these agreements, to date indemnification claims have not had a material impact on our consolidated results of operations or financial condition.

Litigation

From time to time, we are subject to various legal proceedings or claims that arise in the ordinary course of business. We accrue a liability when management believes that it is both probable that we have incurred a liability and we can reasonably estimate the amount of loss. As of December 31, 2023 and 2022, we did not have accrued contingency liabilities. The following is a description of our significant legal proceedings. Although we believe that resolving these claims, individually or in aggregate, will not have a material adverse impact on our financial statements, these matters are subject to inherent uncertainties.

Patent Infringement Claims and Counterclaims

Impinj Patent Infringement Claims Against NXP in California

On June 6, 2019, we filed a patent infringement lawsuit against NXP USA, Inc., a Delaware corporation and subsidiary of NXP Semiconductors N.V., or NXP, in the U.S. District Court for the Northern District of California, or the Court. Our original complaint alleged that certain NXP endpoint ICs infringe 26 of our U.S. patents. At the order of the Court, we filed an amended complaint limited to eight of the original 26 patents. We subsequently elected to go forward with asserting infringement of six of those eight patents. We sought, among other things, past damages, including lost profits; no less than a reasonable royalty; enhanced damages for willful infringement; and reasonable attorneys’ fees and costs. We also sought an injunction against NXP making, selling, using, offering for sale or importing UCODE 8 and UCODE 9 ICs. NXP responded to our complaint on September 30, 2019, citing numerous defenses including denying infringement and claiming our asserted patents are invalid.

After various pre-trial motions, the Court narrowed the case to two patents—U.S. patent nos. 9,633,302, or the ’302 patent and 8,115,597, or the ’597 patent. Before trial, the Court granted summary judgment of infringement on the ‘302 patent. The Court oversaw a jury trial on those two patents beginning on July 5, 2023, and concluding on July 13, 2023. The issues on the ‘302 patent were validity, damages and willful infringement. The issues on the ‘597 patent were infringement, validity, damages and willful infringement.

On July 14, 2023, the jury returned a verdict in our favor finding that: (1) the asserted independent claims of the '302 patent had not been proven invalid, but two of the asserted dependent claims had been proven invalid; (2)

NXP’s infringement of the asserted claims of the ‘302 patent was willful; (3) none of the asserted claims of the ‘597 patent were proven to be invalid; and (4) NXP infringed the asserted claims of the ‘597 patent. The jury awarded lost profits on a portion of NXP’s infringing sales, and for NXP’s remaining infringing sales, awarded royalties for each patent. This resulted in an award of approximately $18.2 million and $18.4 million in damages for infringement of the ‘302 patent and the ’597 patent respectively. Impinj cannot receive lost profits more than once for the same sales so the awards are largely overlapping.

On September 28, 2023, the Court granted NXP's post-trial motion for a new trial on the validity of the '302 patent based on the jury's inconsistent verdicts on the validity of independent and dependent claims for that patent. The Court also ruled that the damages awarded by the jury for both patents should be reduced by certain sales made to a distributor outside the United States. The Court directed the parties to meet and confer on the appropriate reduction of damages, and on October 20, 2023, the parties stipulated that the damages award for the infringement of the '597 patent alone should be $13.1 million. We recognize contingent gains in our financial statements upon resolution of all contingencies related to the award.

On October 3, 2023, the Court denied our motion for a permanent injunction. Having granted a new trial on the validity of the '302 patent, the denial was based only on the '597 patent. We have appealed the denial of the injunction to the Federal Circuit. We also moved for imposition of an ongoing royalty for infringement of the ‘597 patent. The Court indicated it would grant such an ongoing royalty but the amount would be decided after the re-trial on the ‘302 patent.

NXP Patent Infringement Claims Against Impinj in Washington

On October 4, 2019, NXP USA, Inc. and NXP filed a patent infringement lawsuit against us in the U.S. District Court for the District of Delaware. The complaint alleged that certain of our products infringe eight U.S. patents owned by NXP or NXP USA, Inc. The plaintiffs sought, among other things, past damages adequate to compensate them for our alleged infringement of each of the patents-in-suit and reasonable attorneys’ fees and costs. They also sought an injunction against us. We denied we are infringing any of the patents and asserted both that our wafer supplier is licensed under four of them and that all eight are invalid. On September 23, 2020, the District of Delaware granted Impinj’s motion to transfer the case to the U.S. District Court for the Western District of Washington in Seattle.

On December 11, 2020, we moved to stay the case with respect to six of the eight patents in suit pending final resolution of IPR petitions we filed with the PTAB. On February 12, 2021, the Court granted our motion to stay the case as to these six patents. The PTAB instituted IPRs on two of the six challenged patents but denied them on the other four. The Court subsequently removed the stay on the four against which IPRs were not instituted. The Court ultimately narrowed the case to seven patents.

Following the close of fact discovery, the parties each moved for summary judgment on various issues. The Court ultimately granted summary judgment of noninfringement to us on six of the seven patents, and the final patent went to a jury trial beginning on June 5, 2023. The jury found that we did not infringe the patent and a final judgment was entered in our favor. NXP has appealed the judgment. We moved for attorneys’ fees on July 12, 2023 but that motion was denied on August 31, 2023.

Impinj Patent Infringement Claims Against NXP in Texas

On May 25, 2021, we filed a new patent infringement lawsuit against NXP USA in the United States District Court for the Western District of Texas (Waco), asserting that NXP has infringed nine of our patents, including seven that we originally asserted in the Northern California case. We also later added NXP Semiconductor Netherlands B.V. as a defendant.

We are seeking, among other things, past damages, including lost profits; no less than a reasonable royalty; enhanced damages for willful infringement; and reasonable attorney’s fees and costs. We are also seeking an injunction against NXP making, selling, using, offering for sale or importing its UCODE 7, 8 and 9 endpoint ICs.

On July 26, 2021, NXP filed an answer to our complaint and counterclaimed that we infringe nine patents, one of which NXP owns and eight of which NXP recently licensed from a third party. NXP denied infringement, asserted our patents are invalid and asserted that some are unenforceable and/or subject to a license under our commitments to license “necessary” patents to certain standards.

The Patent Office has instituted reexamination proceedings on five of the nine patents asserted by NXP and has issued a final office action rejecting all asserted claims on three of those patents but allowing the claims on another.

A claim construction hearing was held on February 10, 2022. The Court held that the case would proceed with three trials, with each side selecting three patents for each trial. The parties originally selected three patents each for the first trial scheduled to begin on October 30,2023. A Magistrate Judge decided various summary judgment and other pre-trial motions on October 12, 2023. The Magistrate Judge denied most motions but did grant NXP’s motion to prevent Impinj from seeking damages based on induced infringement for sales made outside the United States. NXP subsequently dropped one of their patents for the first trial, leaving two NXP patents for the trial. On November 9, 2023, the jury returned a verdict finding that Impinj did not infringe either of the two NXP patents and that NXP infringed all three Impinj patents. The jury rejected NXP’s other defenses and awarded Impinj approximately $2 million based on a total royalty of 3.26% on the infringing products. Impinj has moved for entry of final judgment and imposition of an ongoing royalty but the briefing on that motion is not complete. The second and third trials in this case have not been scheduled.

Second Impinj Patent Infringement Claims Against NXP in Texas

On August 11, 2023, we filed a patent infringement case against NXP Semiconductor Netherlands B.V. in the United States District Court for the Western District of Texas, asserting the ‘302 and ‘597 patents that were found to be infringed by NXP USA, Inc. in the California case above. NXP has moved to dismiss the case and that motion is pending.

NXP Patent Infringement Claims Against Impinj in China

On December 7, 2020, Impinj Radio Frequency Technology (Shanghai) Co., Ltd., or Impinj Shanghai, was served with patent infringement lawsuits filed in the Intellectual Property Court in Shanghai, China, or Shanghai Intellectual Property Court, in which NXP B.V. asserted that certain of our products infringe three Chinese patents owned by NXP B.V. These patents corresponded to three of the eight U.S. patents NXP asserted in the U.S. District Court in Washington. On September 13, 2023, NXP filed petitions with the Shanghai court to withdraw all three cases without prejudice. The Shanghai court granted NXP’s petitions on September 27, 2023. With the withdrawal of all three lawsuits by NXP, all civil actions initiated by NXP against Impinj in China were concluded. However, proceedings continue at the Beijing Intellectual Property Court as to the validity of the patents that NXP previously asserted.

Obligations with Third-Party Manufacturers

We manufacture products with third-party manufacturers. We are committed to purchase $21.8 million of inventory as of December 31, 2023.
v3.24.0.1
Deferred Revenue
 12 Months Ended
Dec. 31, 2023
Deferred Revenue Disclosure [Abstract]  
Deferred Revenue

Note 13. Deferred Revenue

Deferred revenue, comprising individually immaterial amounts for extended warranties, enhanced product maintenance and advance payments on NRE services contracts, represents contracted revenue that we have not yet recognized.

The following table presents the changes in deferred revenue for the indicated periods (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

Balance at beginning of period

$

2,599

 

 

$

794

 

Balance from acquisition

 

1,233

 

 

 

—

 

Deferral of revenue

 

2,920

 

 

 

3,143

 

Recognition of deferred revenue

 

(4,767

)

 

 

(1,338

)

Balance at end of period

$

1,985

 

 

$

2,599

 

 

 

During 2023, we recognized $2.2 million revenue which we included in deferred revenue as of December 31, 2022. During 2022, we recognized $0.4 million revenue which we included in deferred revenue as of December 31, 2021.
v3.24.0.1
Segment Reporting
 12 Months Ended
Dec. 31, 2023
Segment Reporting [Abstract]  
Segment Reporting

Note 14. Segment Reporting

We have one reportable and operating segment: the development and sale of our products and services. We identified our reportable segment based on how our chief operating decision-maker manages our business, makes operating decisions and evaluates our operating performance. Our chief executive officer acts as the chief operating decision-maker and reviews financial and operational information on an entity-wide basis. We have one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components. Accordingly, we have determined that we have a single reporting segment and operating unit structure.

Information by Revenue Categories

Our chief executive officer reviews information about our revenue categories, endpoint ICs and systems, the latter defined as reader ICs, readers, gateways, test and measurement systems and software. The following table presents our revenue categories for the indicated periods (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Endpoint ICs

 

$

234,426

 

 

$

191,532

 

 

$

139,250

 

Systems

 

 

73,113

 

 

 

66,268

 

 

 

51,033

 

Total revenue

 

$

307,539

 

 

$

257,800

 

 

$

190,283

 

Information by Geography

The following table summarizes our long-lived assets, comprising property and equipment, less accumulated depreciation (in thousands):

 

December 31, 2023

 

 

December 31, 2022

 

United States

 

$

14,110

 

 

$

10,551

 

Malaysia

 

 

11,749

 

 

 

12,817

 

Taiwan

 

 

13,396

 

 

 

12,620

 

Others

 

 

5,636

 

 

 

3,039

 

Total

 

$

44,891

 

 

$

39,027

 

Our geographic revenue in the following table is based on the location of the VARs, inlay manufacturers, reader OEMs, distributors or end users who purchased products and services directly from us. For sales to our resellers and distributors, their location may be different from the locations of the ultimate end users. The following table presents our sales by geography for the indicated periods (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Americas

 

$

96,418

 

 

$

57,129

 

 

$

38,021

 

Asia Pacific

 

 

176,409

 

 

 

168,249

 

 

 

133,152

 

Europe, Middle East and Africa

 

 

34,712

 

 

 

32,422

 

 

 

19,110

 

Total revenue

 

$

307,539

 

 

$

257,800

 

 

$

190,283

 

 

Total revenue in the United States, which is included in the Americas, was $86.2 million, $43.0 million and $32.6 million for the years ended December 31, 2023, 2022 and 2021, respectively. Total revenue in China (and Hong Kong), which is included in Asia Pacific, was $128.3 million, $109.6 million and $98.8 million for the years ended December 31, 2023, 2022 and 2021, respectively. While total revenue in Malaysia, which is included in Asia Pacific, was less than 10% of revenue for the year ended December 31, 2023, it was $41.0 and $23.6 million for the years ended December 31, 2022 and 2021, respectively. No sales to countries other than the United States, China and Malaysia accounted for more than 10% of revenue for the years ended December 31, 2023, 2022 and 2021.
v3.24.0.1
Net Loss Per Share
 12 Months Ended
Dec. 31, 2023
Earnings Per Share [Abstract]  
Net Loss Per Share

Note 15. Net Loss per Share

For the periods presented, the following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net loss per share (in thousands, except for per-share amounts):

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

 

2021

 

Numerator:

 

 

 

 

 

 

 

 

 

Net loss

 

$

(43,366

)

 

$

(24,301

)

 

$

(51,260

)

Denominator:

 

 

 

 

 

 

 

 

 

Weighted-average shares outstanding — basic and diluted

 

 

26,752

 

 

 

25,539

 

 

 

24,176

 

Net loss per share — basic and diluted

 

$

(1.62

)

 

$

(0.95

)

 

$

(2.12

)

 

The following table presents the outstanding shares of our common stock equivalents excluded from the computation of diluted net loss per share as of the dates presented because their effect would have been antidilutive (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Stock options

 

1,466

 

 

 

1,712

 

 

 

2,288

 

RSUs, MSUs and PSUs

 

1,252

 

 

 

1,494

 

 

 

1,517

 

Employee stock purchase plan shares

 

51

 

 

 

26

 

 

 

42

 

2019 Notes

 

—

 

 

 

—

 

 

 

285

 

2021 Notes

 

2,589

 

 

 

2,589

 

 

 

2,589

 
v3.24.0.1
Related-Party Transactions
 12 Months Ended
Dec. 31, 2023
Related Party Transactions [Abstract]  
Related-Party Transactions

Note 16. Related-Party Transactions

We have been party to a consulting agreement with a limited liability company owned by Cathal Phelan, a member of our board of directors, pursuant to which Mr. Phelan provided advisory and consulting services to us. We recognized and paid $0.5 million in consulting fees to the limited liability company owned by Mr. Phelan for the years ended December 31, 2022 and 2021. No consulting fees were recognized and paid in the year ended December 31, 2023y. Additionally, we granted 60,000 shares of stock options to Mr. Phelan on September 21, 2020 in connection with these consulting services, with 1/24th of the shares subject to the option vesting on October 21, 2020 and 1/24th of the shares subject to the option vesting on each month thereafter, subject to Mr. Phelan remaining a service provider. Further, in connection with these consulting services, we granted 8,000 RSUs to Mr. Phelan on October 1, 2022 with ¼th of the RSUs vesting on January 1, April 1, July 1 and October 1, 2023, subject to Mr. Phelan remaining a service provider. On January 1, 2023, Mr. Phelan joined our company as Chief Innovation Officer and ceased to provide us with consulting services. Mr. Phelan remains on our board of directors as a non-independent director.

On June 23, 2023, we acquired a patent from a related party in which a member of our board of directors holds an executive leadership position. The patent pertains to our endpoint IC products and the acquisition price was $0.3 million. The patent expires on July 17, 2026 and does not have renewal rights. This patent is included in our intangible assets on our consolidated balance sheet as of December 31, 2023.
v3.24.0.1
Retirement Plans
 12 Months Ended
Dec. 31, 2023
Retirement Benefits [Abstract]  
Retirement Plans

Note 17. Retirement Plans

In 2001, we adopted a salary deferral 401(k) plan for our employees. The plan allows employees to contribute a percentage of their pretax earnings annually, subject to limitations imposed by the Internal Revenue Service, and allows a matching contribution, subject to certain limitations. We contributed $1.8 million and $1.4 million as matching contributions for the years ended December 31, 2023 and 2022, respectively.
v3.24.0.1
Restructuring
 12 Months Ended
Dec. 31, 2023
Restructuring and Related Activities [Abstract]  
Restructuring

Note 18. Restructuring

On February 2, 2021, we restructured our go-to-market organization to strategically align our global sales, product, partner development and marketing teams. As part of the restructuring, we eliminated approximately seven full-time positions within our go-to-market organization, representing roughly 2% of our workforce. We incurred restructuring charges of $1.7 million for employee termination benefits and other associated costs for legal expenses for the year ended December 31, 2021. Restructuring charges were immaterial for the year ended December 31, 2022 and there were no restructuring charges for the year ended December 31, 2023.

v3.24.0.1
Subsequent Events
 12 Months Ended
Dec. 31, 2023
Subsequent Events [Abstract]  
Subsequent Events

Note 19. Subsequent Events

On February 7, 2024, we initiated a strategic restructuring to align financial, business and research and development objectives for long-term growth, including a reduction-in-force affecting approximately 10% of our employees. We expect the reduction-in-force charges, comprising primarily severance benefits, to be in the range of $1.7 million to $2.0 million to be recognized in the first and second fiscal quarters of 2024, when the activities comprising the plan are expected to be substantially completed.
v3.24.0.1
Summary of Significant Accounting Policies (Policies)
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements include Impinj, Inc. and its wholly owned subsidiaries. We have eliminated intercompany balances and transactions in consolidation. We have prepared these consolidated financial statements in conformity with U.S. generally accepted accounting principles, or GAAP.

All numbers in the consolidated financial statements are rounded to the nearest thousand, except for per share data, and numbers in the notes to the consolidated financial statements are rounded to the nearest million.
 
Use of Estimates

Use of Estimates

Preparing financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and related disclosures as of the date of the financial statements, as well as the reported revenue and expenses during the periods presented. We evaluate our estimates on an ongoing basis, including those related to revenue recognition, sales incentives, the fair value of asset acquired, liabilities assumed, contingent consideration in business combinations, inventory excess and obsolescence, income taxes and fair value of stock awards. To the extent there are material differences between our estimates, judgments or assumptions and actual results, our financial statements will be affected.

Concentrations of Credit Risk

Concentrations of Credit Risk

Financial instruments, which potentially subject us to credit-risk concentration, comprise primarily cash equivalents, investments and accounts receivable. We place our cash and cash equivalents and investments with major financial institutions, which management assesses to be of high credit quality, to limit our investment exposure. We extend credit to customers based on our evaluation of the customer’s financial condition and generally do not require collateral. The following tables present total revenue and accounts receivable concentration for the indicated periods as of the dates presented:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Revenue:

 

 

 

 

 

 

Avery Dennison

 

 

33

%

 

 

28

%

 

 

32

%

Arizon

 

 

11

 

 

 

10

 

 

 

11

 

 

 

44

%

 

 

38

%

 

 

43

%

 

 

As of December 31,

 

 

2023

 

 

2022

 

Accounts Receivable:

 

 

 

 

Avery Dennison

 

 

39

%

 

 

24

%

Arizon

 

 

11

 

 

 

13

 

 

 

50

%

 

 

37

%

 
Concentration of Supplier Risk

Concentration of Supplier Risk

We outsource the manufacturing and production of our hardware products to a small number of suppliers. We believe other suppliers could provide similar products on comparable terms if needed. However, a supplier change could delay manufacturing and cause a sales loss, which would adversely affect our operating results.
Cash and Cash Equivalents

Cash and Cash Equivalents

Cash includes demand deposits with banks or financial institutions. Cash equivalents include short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present minimal risk of changes in value with changes in interest rates. Our cash equivalents are solely investments with an original or remaining maturity of three months or less at the date of purchase. We regularly maintain cash amounts exceeding federally insured limits at financial institutions.
Investments

Investments

Our investments comprise fixed income securities, including U.S. government securities, corporate notes and bonds, commercial paper and asset-backed securities. The contractual maturities of some of our available-for-sale, or AFS, debt securities exceed a year and are classified as long-term investments on our balance sheet. We carry AFS debt securities at fair value with unrealized gains and losses reported as a component of other comprehensive income (loss). Our investments are subject to a periodic impairment review. We recognize an impairment charge when a decline in fair value of an investment below the cost basis is determined to be other-than-temporary. Factors we consider in determining whether a loss is temporary include the extent and length of time the investment's fair value has been lower than its cost basis, the financial condition and near-term prospects of the investee, our intent to sell the security and whether or not we will be required to sell the security prior to the expected recovery of the investment's amortized cost basis. No such impairment changes were recorded during the years ended December 31, 2023, 2022 and 2021. See Note 3 tables for the cost or amortized cost, gross unrealized gains, gross unrealized losses and total estimated fair value of our financial assets as of December 31, 2023 and 2022.
Fair Value Measurement

Fair Value Measurement

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

•
Level 1 — Quoted prices in active markets for identical assets or liabilities.
•
Level 2 — Assets and liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities.
•
Level 3 — Unobservable inputs that are supported by little or no market activity; instruments valued based on the best available data, some of which are internally developed, and considers risk premiums that a market participant would require.

We do not have any financial assets or liabilities in Level 3 as of December 31, 2022 or at December 31, 2023, except for the liability for the earnout consideration related to the Voyantic Oy acquisition. We have classified this liability as such because we determined the fair value using significant unobservable inputs. See Note 3: Fair Value Measurements and Note 6: Goodwill and Intangible Assets.

We applied the following methods and assumptions in estimating our fair value measurements:

Cash Equivalents — Cash equivalents comprise highly liquid investments, including money market funds with original maturities of less than three months at the acquisition date. We record the fair value measurement of these assets based on quoted market prices in active markets.

Investments — Our investments comprise fixed income securities, which include U.S. government agency securities, corporate notes and bonds, commercial paper, treasury bills and asset-backed securities. The fair value measurement of these assets is based on observable market-based inputs or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means.

Long-term Debt —See Note 8 for the carrying amount and estimated fair value of the Notes.

Accounts Receivable and Allowances

Accounts Receivable and Allowances

Accounts receivable comprises amounts billed and currently due from customers, net of allowances for doubtful accounts, sales returns and price exceptions.

The allowance for doubtful accounts is our best estimate of the amount of probable lifetime-expected credit losses in existing accounts receivable and is determined based on our historical collections experience, age of the receivable, knowledge of the customer and the condition of the general economy and industry as a whole. We record changes in our estimate of the allowance for doubtful accounts through bad debt expense and write off the receivable and corresponding allowance when accounts are ultimately determined to be uncollectible. We include bad debt expense in general and administrative expenses. For the periods presented in this report, bad debt expense and the allowance for doubtful accounts were not material.

We derive most of our accounts receivable from sales to original equipment manufacturers, or OEMs, original design manufacturers, ODMs, solution providers, and distributors who are large, well-established companies. We do not have customers that represent a significant credit risk based on current economic conditions and past collection experience. Also, we have not had material past-due balances on our accounts receivable as of December 31, 2023 or 2022.

The allowance for sales returns and price exceptions is our best estimate based on our historical experience and currently available evidence. We record changes in our estimate of the allowance for sales returns and price exceptions through revenue, and relieve the allowance when we receive product returns or process claims for price exceptions. The following table summarizes our allowance for sales returns (in thousands):

 

 

Balance at Beginning of Year

 

 

Additional Reserve

 

 

Applied Sales Return

 

 

Balance at End of Year

 

Allowance for sales returns and price exceptions:

 

 

 

 

 

 

 

 

During year ended December 31, 2023

 

$

605

 

 

$

2,912

 

 

$

(2,840

)

 

$

677

 

During year ended December 31, 2022

 

 

947

 

 

 

1,899

 

 

 

(2,241

)

 

 

605

 

During year ended December 31, 2021

 

 

406

 

 

 

2,780

 

 

 

(2,239

)

 

 

947

 
Inventory

Inventory

We state inventories at the lower of cost or estimated net realizable value using the average costing method, which approximates a first-in, first-out method. Inventories comprise raw materials, work-in-process and finished goods. We continuously assess our inventory value and write down its value for estimated excess and obsolete inventory. This evaluation includes an analysis of inventory on hand, current and forecasted demand, product development plans and market conditions. If future demand or market conditions are less favorable than our projections, or our product development plans change from current expectations, then a write-down of excess or obsolete inventory may be required and is reflected in cost of goods sold in the period the updated information is known.

Excess and obsolescence charges had an immaterial impact on our 2023 and 2022 gross margin. Sales of fully reserved inventory had a favorable net impact of 1.5% on our 2021 gross margin. The 2021 favorable net impact was primarily from sales of fully reserved inventory, primarily endpoint ICs and readers included in the excess and obsolescence charge recorded in 2020. Because of industry-wide wafer shortages and reader supply constraints in 2021 and 2020, we sold a significant portion of the reserved endpoint ICs and gateways in the year ended December 31, 2021.
Property and Equipment

Property and Equipment

We record property and equipment at cost and depreciate it using the straight-line method over the estimated useful lives of the related assets. The useful lives are as follows:

Category

 

Useful Life

 

 

Machinery and equipment

 

1 to 10 years

 

 

Computer equipment and software

 

3 to 5 years

 

 

Furniture and fixtures

 

3 to 7 years

 

 

Equipment acquired under finance leases

 

3 to 7 years

 

 

Leasehold improvements

 

Shorter of remaining lease term or expected useful life
We charge maintenance and repair costs to expense when incurred. We capitalize major improvements, which extend the useful life of the related asset. Upon disposal of a fixed asset, we record a gain or loss based on the differences between the proceeds received and the net book value of the disposed asset.
Other Assets

Other Assets

Other assets comprise primarily capitalized implementation costs from cloud computing arrangements and security deposits. We capitalize eligible costs associated with cloud computing arrangements over the term of the arrangement, plus reasonably certain renewals, and recognize those costs on a straight-line basis in the same line item in the consolidated statement of operations as the expense for fees associated with the cloud computing arrangement. Cloud computing arrangement costs, included in prepaid expenses and other current assets, were $0.4 million and $0.4 million, and other non-current assets were $1.4 million and $1.8 million, as of December 31, 2023 and 2022, respectively. Amortization expense associated with the cloud computing arrangements was $0.5 million for 2023, $0.4 million for 2022, and $0.2 million for 2021. We present cash flows related to capitalized implementation costs in cash flows used in operating activities.

Business Combinations and Intangible Assets Including Goodwill

Business combinations and intangible assets including goodwill

We account for business combinations using the acquisition method which involves allocating the purchase price paid to assets acquired and liabilities assumed at their acquisition-date fair values. The excess of the fair value of purchase consideration over the fair value of the identifiable assets and liabilities is recorded as goodwill. While we use our best estimates and assumptions to accurately estimate the fair value of assets acquired, liabilities assumed and the contingent consideration liability, our estimates are inherently uncertain. These estimates include, but are not limited to, estimates of future revenue, revenue growth rates, discount rates, underlying product or technology life cycles and expenses necessary to support the acquired technology, and estimated sales cycle for customer relationships. During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.

We review assumptions related to the fair value of the contingent consideration each reporting period until the contingency is satisfied. We recognize the change in fair value of the contingent consideration liability in “General and administrative” expense on the consolidated statements of operations for the period in which the fair value changes.

We assess the impairment of goodwill on an annual basis, during the fourth quarter, or otherwise when events or changes in circumstances indicate that goodwill may be impaired.

We amortize identifiable intangible assets with finite lives over their useful lives on a straight-line basis.

We expense acquisition-related costs, including advisory, legal, accounting, valuation and other similar costs in the periods in which the costs are incurred.

Revenue Recognition

Revenue Recognition

We generate revenue primarily from sales of hardware products. We also generate revenue from software, extended warranties, enhanced maintenance, support services, and nonrecurring engineering, or NRE, development services, none of which are material.

We recognize revenue when we transfer control of the promised goods or services to our customers, which for hardware sales is generally at the time of product shipment as determined by agreed-upon shipping terms. We measure revenue based on the amount of consideration we expect to be entitled-to in exchange for those goods or services. We expect the period between when we transfer control of promised goods or services and when we receive payment to be one year or less, and that expectation is consistent with our historical experience. As such, we do not adjust our revenue for the effects of a significant financing component. We recognize any variable consideration, which comprises primarily sales incentives, as revenue reduction at the time of revenue recognition. We estimate sales incentives based on our historical experience and current expectations at the time of revenue recognition and update them at the end of each reporting period as additional information becomes available.

Our reader and gateway products are highly dependent on embedded software and cannot function without this embedded software. We account for the hardware and embedded software as a single performance obligation and recognize revenue when control is transferred.

Our customer contracts with multiple performance obligations generally include a combination of hardware products, extended warranty, enhanced maintenance and support services. For these contracts, we account for individual performance obligations separately if they are distinct. We allocate the transaction price to the separate performance obligations on a relative standalone selling-price basis. In instances where the standalone selling price is not directly observable, such as when we do not sell the product or service separately, we determine the standalone selling price using one, or a combination of, the adjusted market assessment or expected cost-plus margin. We defer amounts allocated to extended warranty and enhanced maintenance sold with our reader and gateway products and recognize them on a straight-line basis over the term of the arrangement, which is typically from one to three years. We defer amounts allocated to support services sold with our reader and gateway products and recognize them when we transfer control of the promised services to our customers.

For NRE development agreements that involve significant production, modification or customization of our products, we generally recognize revenue over the performance period using the cost-input method because it best depicts the transfer of services to the customer. We receive payments under these agreements based on a billing schedule. Contract assets relate to our conditional right to consideration for our completed performance under these agreements. We record accounts receivable when the right to consideration becomes unconditional. For the periods presented in this report, our contract assets, deferred revenue and the value of unsatisfied performance obligations for NRE development agreements are not material.

If a customer pays consideration before we transfer a good or service under the contract, then we classify those amounts as contract liabilities or deferred revenue. We recognize contract liabilities as revenue when we transfer control of the promised goods or services to our customers.

Payment terms typically range from 30 to 120 days. We present revenue net of sales tax in our consolidated statements of operations. We include shipping charges billed to customers in revenue and the related shipping costs in cost of revenue.

Practical Expedients and Exemptions: We expense sales commissions when incurred because we expect the amortization period to be one year or less. We record these costs within sales and marketing expenses. We do not disclose the value of unsatisfied performance obligations for (1) contracts with an original expected length of one year or less and (2) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

Product Warranties

Product Warranties

We provide limited warranty coverage for most products, generally ranging from a period of 90 days to one year from the date of shipment. We record a liability for the estimated cost of these warranties based on historical

claims, product failure rates and other factors when we recognize the related revenue. We review these estimates periodically and adjust our warranty reserves when actual experience differs from historical estimates or when other information becomes available. The warranty liability primarily includes the anticipated cost of materials, labor and shipping necessary to repair or replace the product. Accrued warranty costs in 2023, 2022 and 2021 were not material.
Leases

Leases

We determine, at inception, whether an arrangement is or contains a lease. Right-of-use, or ROU, assets represent our right to use an identified asset for the lease term. Lease liabilities represent our obligation to make lease payments arising from the lease. We recognize operating lease ROU assets and liabilities at commencement date based on the present value of future lease payments over the lease term. We use an incremental borrowing rate in determining the present value of future lease payments because our operating leases do not provide an implicit rate. Our incremental borrowing rate is based on a credit-adjusted risk-free rate, which best approximates a secured rate over a similar term of lease. We recognize lease expense for lease payments on a straight-line basis over the lease term. Our lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. We expense variable lease costs on the consolidated statements of operations as incurred. Our lease agreements generally do not contain any residual value guarantees or restrictive covenants.

We have various noncancellable operating lease agreements for office, warehouse and research and development space in the U.S., China, Thailand, Brazil, Malaysia and Finland, with expiration dates from 2024 to 2029. Certain of these arrangements have free or escalating rent payment provisions and optional renewal and termination clauses that we factor into the classification and measurement of the lease when appropriate. These lease agreements typically include lease and non-lease components and are generally accounted for as a single lease component. We consider variable CAM expenses for real estate leases as non-lease components.

We do not record leases with an initial term of 12 months or less on our consolidated balance sheet; we instead recognize lease expense for these leases on a straight-line basis over the lease term.
Research and Development Costs

Research and Development Costs

Research and development expense comprises primarily personnel expenses (salaries, benefits and other employee related costs) and stock-based compensation expense for our product-development personnel; external consulting and service costs; prototype materials; other new-product development costs; and an allocated portion of infrastructure costs which include occupancy, depreciation and software costs.
Foreign Currency

Foreign Currency

We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiary into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for this subsidiary are translated using rates that approximate those in effect during the period. We recognize gains and losses from these translations as a component of accumulated other comprehensive income (loss) in stockholders' equity. Our subsidiaries that use the U.S. dollar as their functional currency remeasure monetary assets and liabilities at exchange rates in effect at the end of each period, and non-monetary assets and liabilities at historical rates. We have included the gains or losses from foreign currency remeasurement in earnings.

Income Taxes

Income Taxes

We use the asset and liability approach for accounting, which requires recognizing deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax bases. We measure deferred tax assets and liabilities using enacted tax rates expected to be in effect when the assets and liabilities are recovered or settled. We recognize the effects of a change in tax rates on deferred tax assets and liabilities in the year of the enactment date. We determine deferred tax assets, including historical net operating losses and deferred tax liabilities, based on temporary differences between the book and tax bases of the assets and liabilities. We believe that it is currently more likely than not that our deferred tax assets will not be realized and, as such, we have recorded a full valuation allowance for these assets. We evaluate the likelihood of our ability to realize deferred tax assets in future periods on a quarterly basis, and if evidence indicates we will be able to realize some or all of our deferred tax assets then we will revise our valuation allowance accordingly.

We use a two-step approach for evaluating uncertain tax positions. First, we evaluate recognition, which requires us to determine if the weight of available evidence indicates that a tax position is more likely than not to be sustained upon audit, including resolution of related appeals or litigation processes. If we consider a tax position more likely than not to be unsustained, then no benefits of the position are recognized. Second, we measure the uncertain tax position based on the largest amount of benefit which is more likely than not to be realized on effective settlement. This process involves estimating our actual current tax exposure, including assessing the risks associated with tax audits, together with assessing temporary differences resulting from the different treatment of items for tax and financial reporting purposes. If actual results differ from our estimates, then our net operating loss and credit carryforwards could be materially impacted.

Us realizing the benefits of the NOLs and credit carryforwards depends on sufficient taxable income in future years. We have established a valuation allowance against the carrying value of our deferred tax assets, as it is currently more likely than not we will be unable to realize these deferred tax assets. In addition, using NOLs and credits to offset future income subject to taxes may be subject to substantial annual limitations due to the “change in ownership” provisions of the Code and similar state provisions. Events that cause limitations in the amount of NOLs that we may use in any one year include, but are not limited to, a cumulative ownership change of more than 50%, as defined by Code Sections 382 and 383, over a three-year period. Using our NOLs and tax credit carryforwards could be significantly reduced if a cumulative ownership change of more than 50% has occurred in our past or occurs in our future.
Stock-Based Compensation

Stock-Based Compensation

We have various equity award plans, or Plans for granting share-based awards to employees, consultants and non-employee Company directors. The Plans provide for granting several available forms of stock compensation such as stock option awards, restricted stock units, or RSUs, RSUs with performance conditions, or PSUs, and RSUs with market and service conditions, or MSUs and an employee stock purchase plan, or ESPP.

We measure stock-based compensation costs for all share-based awards at fair value on the measurement date, which is typically the grant date. We determine the fair value of stock options using the Black-Scholes option-pricing model, which considers, among other things, estimates and assumptions on the expected life of the options, stock price volatility and market value of the Company’s common stock. We determine the fair value of RSUs and PSUs based on the closing price of our common stock at grant date. Additionally, for awards with a market condition, we use a Monte Carlo simulation model to estimate grant date fair value, which takes into consideration the range of possible stock price of total stockholder return outcomes.

Net Loss per Share

Net Loss per Share

We compute net loss per share by dividing net loss by the weighted-average number of shares of common stock outstanding. We have outstanding stock options, RSUs, PSUs, MSUs and an ESPP, each of which we include in our calculation of diluted net loss per share if their effect would be dilutive. We compute diluted net loss per share by considering all potential dilutive common stock equivalents outstanding for the period.

Upon us adopting Accounting Standard Update, or ASU, 2020-06 using the modified retrospective transition method on January 1, 2021, we applied the “if-converted” method for calculating any potential dilutive effect of the conversion of the 2019 and 2021 Notes on diluted net loss per share for the years ended December 31, 2023 and 2022. For more information about the 2019 and 2021 Notes, please refer to Note 8 to our consolidated financial statements.
Recently Adopted Accounting Standards

Recently Adopted Accounting Standards

In August 2020, the Financial Statement Accounting Board, or FASB, issued guidance on debt with conversion and other options, or ASU 2020-06. This guidance eliminated the beneficial and cash-conversion accounting models for convertible instruments and amends the derivative scope exception for contracts in an entity’s own equity. Additionally, this guidance requires the application of the “if-converted” method to calculate the impact of convertible instruments on diluted earnings per share. We adopted ASU 2020-06 on January 1, 2021 using the modified retrospective transition method and accounted for our 2019 Notes on a whole-instrument basis. We recorded a $29.3 million increase to long-term debt, a $32.7 million decrease to additional paid-in capital and a $3.4 million decrease to accumulated deficit on January 1, 2021. Interest expense decreased for the year ended December 31, 2021 compared with the years ended December 31, 2020 and December 31, 2019, respectively, as we no longer separate an equity component of the 2019 Notes and incur amortization of debt discount. We had no changes to net deferred tax liabilities, due to the decrease in deferred tax liability being offset by a corresponding increase in valuation allowance upon adoption.

We present our consolidated financial statements as of and for the year ended December 31, 2021, under ASU 2020-06. We have not adjusted the comparative prior reporting periods and continue to report them in accordance with our historical accounting policy.
Recently Issued Accounting Standards Not Yet Adopted

Recently Issued Accounting Standards Not Yet Adopted

In November 2023, the FASB released ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which amends reportable segment requirements, primarily through enhanced disclosures about significant segment expenses, including for public entities that have a single reportable segment. The standard is effective for fiscal years beginning after December 31, 2023 and interim periods within fiscal years beginning after December 31, 2024. We are currently evaluating any impact of this standard on our financial statement disclosures.

In December 2023, the FASB released ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which amends income tax disclosure requirements to enhance the transparency and decision usefulness for users of the financial statements. The standard is effective for fiscal years beginning after December 31, 2024. We are currently evaluating any impact of this standard on our financial statement disclosures.
v3.24.0.1
Summary of Significant Accounting Policies (Tables)
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
Schedule of Revenue and Accounts Receivable Concentration The following tables present total revenue and accounts receivable concentration for the indicated periods as of the dates presented:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Revenue:

 

 

 

 

 

 

Avery Dennison

 

 

33

%

 

 

28

%

 

 

32

%

Arizon

 

 

11

 

 

 

10

 

 

 

11

 

 

 

44

%

 

 

38

%

 

 

43

%

 

 

As of December 31,

 

 

2023

 

 

2022

 

Accounts Receivable:

 

 

 

 

Avery Dennison

 

 

39

%

 

 

24

%

Arizon

 

 

11

 

 

 

13

 

 

 

50

%

 

 

37

%

 
Summary of Allowance for Sales Returns The following table summarizes our allowance for sales returns (in thousands):

 

 

Balance at Beginning of Year

 

 

Additional Reserve

 

 

Applied Sales Return

 

 

Balance at End of Year

 

Allowance for sales returns and price exceptions:

 

 

 

 

 

 

 

 

During year ended December 31, 2023

 

$

605

 

 

$

2,912

 

 

$

(2,840

)

 

$

677

 

During year ended December 31, 2022

 

 

947

 

 

 

1,899

 

 

 

(2,241

)

 

 

605

 

During year ended December 31, 2021

 

 

406

 

 

 

2,780

 

 

 

(2,239

)

 

 

947

 
Schedule of Property and Equipment Estimated Useful Lives

We record property and equipment at cost and depreciate it using the straight-line method over the estimated useful lives of the related assets. The useful lives are as follows:

Category

 

Useful Life

 

 

Machinery and equipment

 

1 to 10 years

 

 

Computer equipment and software

 

3 to 5 years

 

 

Furniture and fixtures

 

3 to 7 years

 

 

Equipment acquired under finance leases

 

3 to 7 years

 

 

Leasehold improvements

 

Shorter of remaining lease term or expected useful life
v3.24.0.1
Fair Value Measurements (Tables)
 12 Months Ended
Dec. 31, 2023
Fair Value Disclosures [Abstract]  
Summary of Assets Measured at Fair Value on Recurring Basis

The following table presents the balances of assets measured at fair value on a recurring basis, by level within the fair value hierarchy, as of the dates presented (in thousands):

 

 

 

December 31, 2023

 

 

December 31, 2022

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

78,661

 

 

$

—

 

 

$

—

 

 

$

78,661

 

 

$

14,620

 

 

$

—

 

 

$

—

 

 

$

14,620

 

Total cash equivalents

 

 

78,661

 

 

 

—

 

 

 

—

 

 

 

78,661

 

 

 

14,620

 

 

 

—

 

 

 

—

 

 

 

14,620

 

Short-term investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency securities

 

 

—

 

 

 

11,893

 

 

 

—

 

 

 

11,893

 

 

 

—

 

 

 

78,621

 

 

 

—

 

 

 

78,621

 

Corporate notes and bonds

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

26,953

 

 

 

—

 

 

 

26,953

 

Commercial paper

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

24,073

 

 

 

—

 

 

 

24,073

 

Treasury bill

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

11,359

 

 

 

—

 

 

 

11,359

 

Yankee bonds

 

 

—

 

 

 

1,951

 

 

 

—

 

 

 

1,951

 

 

 

—

 

 

 

1,939

 

 

 

—

 

 

 

1,939

 

Agency bonds

 

 

—

 

 

 

2,994

 

 

 

—

 

 

 

2,994

 

 

 

—

 

 

 

2,882

 

 

 

—

 

 

 

2,882

 

Asset-backed securities

 

 

—

 

 

 

1,602

 

 

 

—

 

 

 

1,602

 

 

 

—

 

 

 

8,321

 

 

 

—

 

 

 

8,321

 

Total short-term investments

 

 

—

 

 

 

18,440

 

 

 

—

 

 

 

18,440

 

 

 

—

 

 

 

154,148

 

 

 

—

 

 

 

154,148

 

Long-term investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government agency securities

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

13,462

 

 

 

—

 

 

 

13,462

 

Yankee bonds

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,869

 

 

 

—

 

 

 

1,869

 

Agency bonds

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

2,983

 

 

 

—

 

 

 

2,983

 

Asset-backed securities

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

886

 

 

 

—

 

 

 

886

 

Total long-term investments

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

19,200

 

 

 

—

 

 

 

19,200

 

Total

 

$

78,661

 

 

$

18,440

 

 

$

—

 

 

$

97,101

 

 

$

14,620

 

 

$

173,348

 

 

$

—

 

 

$

187,968

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition related contingent consideration liability

 

 

—

 

 

 

—

 

 

 

6,180

 

 

 

6,180

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total liabilities at fair value

 

$

—

 

 

$

—

 

 

$

6,180

 

 

$

6,180

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 
Schedule of Additional Information of Liabilities Measured at Fair Value for Company Utilized Level 3 Inputs to Determine Fair Value

The following table presents additional information about liabilities measured at fair value for which the Company utilizes Level 3 inputs to determine fair value as of December 31, 2023:

 

 

 

Year Ended December 31,

 

 

 

2023

 

Balance as of January 1

 

$

—

 

Addition of contingent consideration liability due to acquisition

 

 

4,602

 

Change in fair value of contingent consideration liability due to remeasurement

 

 

1,578

 

Balance as of December 31

 

$

6,180

 
Schedule of Cost Or Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, And Total Estimated Fair Value Of Financial Assets

The following tables present the cost or amortized cost, gross unrealized gains, gross unrealized losses and total estimated fair value of our financial assets as of the dates presented (in thousands):

 

December 31, 2023

 

 

Cost or

 

 

Gross

 

 

Gross

 

 

Total Estimated

 

 

Amortized Cost

 

 

Unrealized Gains

 

 

Unrealized Losses

 

 

Fair Value

 

Description:

 

 

 

 

 

 

 

 

 

 

 

Money market funds

$

78,661

 

 

$

—

 

 

$

—

 

 

$

78,661

 

U.S. government agency securities

 

11,932

 

 

 

—

 

 

 

(39

)

 

 

11,893

 

Corporate notes and bonds

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Yankee bonds

 

1,956

 

 

 

—

 

 

 

(5

)

 

 

1,951

 

Commercial paper

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Treasury bill

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Agency bond

 

2,998

 

 

 

—

 

 

 

(4

)

 

 

2,994

 

Asset-backed securities

 

1,604

 

 

 

—

 

 

 

(2

)

 

 

1,602

 

Total

$

97,151

 

 

$

—

 

 

$

(50

)

 

$

97,101

 

 

 

December 31, 2022

 

 

Cost or

 

 

Gross

 

 

Gross

 

 

Total Estimated

 

 

Amortized Cost

 

 

Unrealized Gains

 

 

Unrealized Losses

 

 

Fair Value

 

Description:

 

 

 

 

 

 

 

 

 

 

 

Money market funds

$

14,620

 

 

$

—

 

 

$

—

 

 

$

14,620

 

U.S. government agency securities

 

93,065

 

 

 

—

 

 

 

(982

)

 

 

92,083

 

Corporate notes and bonds

 

27,133

 

 

 

6

 

 

 

(186

)

 

 

26,953

 

Yankee bonds

 

3,815

 

 

 

—

 

 

 

(7

)

 

 

3,808

 

Commercial paper

 

24,073

 

 

 

—

 

 

 

—

 

 

 

24,073

 

Treasury bill

 

11,361

 

 

 

2

 

 

 

(4

)

 

 

11,359

 

Agency bond

 

5,863

 

 

 

4

 

 

 

(2

)

 

 

5,865

 

Asset-backed securities

 

9,287

 

 

 

2

 

 

 

(82

)

 

 

9,207

 

Total

$

189,217

 

 

$

14

 

 

$

(1,263

)

 

$

187,968

 
v3.24.0.1
Inventory (Tables)
 12 Months Ended
Dec. 31, 2023
Inventory Disclosure [Abstract]  
Schedule of Inventories

The following table presents the detail of inventories as of the dates presented (in thousands):

 

 

 

 

 

 

 

 

 

 

December 31, 2023

 

 

December 31, 2022

 

Raw materials

 

$

21,773

 

 

$

14,678

 

Work-in-process

 

 

42,217

 

 

 

14,525

 

Finished goods

 

 

33,182

 

 

 

17,194

 

Total inventory

 

$

97,172

 

 

$

46,397

 
v3.24.0.1
Property and Equipment (Tables)
 12 Months Ended
Dec. 31, 2023
Property, Plant and Equipment [Abstract]  
Schedule of Property and Equipment

The following table presents property and equipment details as of the dates presented (in thousands):

 

 

 

 

 

 

 

 

December 31, 2023

 

 

December 31, 2022

 

Machinery and equipment

 

$

57,511

 

 

$

48,420

 

Computer equipment and software

 

 

3,012

 

 

 

3,308

 

Furniture and fixtures

 

 

1,333

 

 

 

1,303

 

Equipment acquired under finance leases

 

 

1,728

 

 

 

2,895

 

Leasehold improvements

 

 

12,966

 

 

 

10,684

 

Total property and equipment, gross

 

 

76,550

 

 

 

66,610

 

Less: Accumulated depreciation

 

 

(31,659

)

 

 

(27,583

)

Total property and equipment, net

 

$

44,891

 

 

$

39,027

 
v3.24.0.1
Goodwill and Intangible Assets (Tables)
 12 Months Ended
Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Goodwill

The following table presents goodwill as of December 31, 2023 (in thousands):

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

Balance at beginning of period

 

$

3,881

 

 

$

3,881

 

Additions from acquisition

 

 

15,590

 

 

 

—

 

Foreign currency translation adjustment

 

 

225

 

 

 

—

 

   Total

 

$

19,696

 

 

$

3,881

 
Schedule of Intangible Assets

As of December 31, 2023, intangible assets comprised of the following (in thousands):

 

 

 

Estimated Useful Life in Years

 

Gross Carrying Amount

 

 

Accumulated Amortization

 

 

Net

 

Definite-lived intangible assets:

 

 

 

 

 

 

 

 

 

 

 

   Backlog

 

0.25

 

$

773

 

 

$

(773

)

 

$

—

 

   Customer Relationships

 

1

 

 

3,698

 

 

 

(2,773

)

 

 

925

 

   Developed Technology

 

7.25

 

 

13,024

 

 

 

(1,348

)

 

 

11,676

 

   Patent

 

3

 

 

250

 

 

 

(38

)

 

 

212

 

   Tradename

 

8

 

 

1,214

 

 

 

(114

)

 

 

1,100

 

   Total definite-lived intangible assets (1)

 

 

 

 

18,959

 

 

 

(5,046

)

 

 

13,913

 

(1) Foreign intangible asset carrying amounts are affected by foreign currency translation

 
Schedule of Estimated Intangible Asset Amortization Expense

As of December 31, 2023, the estimated intangible asset amortization expense for the next five years and thereafter is as follows:

 

Estimated Amortization

 

 

 

(in thousands)

 

2024

 

 

2,956

 

2025

 

 

2,032

 

2026

 

 

1,993

 

2027

 

 

1,948

 

2028

 

 

1,948

 

Thereafter

 

 

3,036

 

Total

 

$

13,913

 
v3.24.0.1
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Summary of Components of Income (Loss) before Income Taxes

The following table presents U.S. and foreign components of income (loss) before income taxes (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

U.S.

 

$

(40,349

)

 

$

(24,508

)

 

$

(51,488

)

Foreign

 

 

(3,339

)

 

 

391

 

 

 

381

 

Loss before income taxes

 

$

(43,688

)

 

$

(24,117

)

 

$

(51,107

)
Summary of Income Tax Expense

The following table presents the detail of income tax benefit (expense) for the periods presented (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Current:

 

 

 

 

 

 

U.S. - Federal

 

$

—

 

 

$

—

 

 

$

—

 

U.S. - State

 

 

(163

)

 

 

(68

)

 

 

(8

)

Foreign

 

 

(446

)

 

 

(110

)

 

 

(137

)

 

 

(609

)

 

 

(178

)

 

 

(145

)

Deferred:

 

 

 

 

 

 

 

 

 

U.S. - Federal

 

 

(53

)

 

 

5

 

 

 

(7

)

U.S. - State

 

 

—

 

 

 

(11

)

 

 

(1

)

Foreign

 

 

984

 

 

 

—

 

 

 

—

 

 

 

931

 

 

 

(6

)

 

 

(8

)

Total income tax expense

 

$

322

 

 

$

(184

)

 

$

(153

)
Reconciliation of U.S. Federal Statutory Income Tax Rate to Effective Income Tax Rate

The following table presents a reconciliation of the federal statutory rate and our effective tax rate for the periods presented:

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

U.S. Statutory Rate

 

 

21.0

%

 

 

21.0

%

 

 

21.0

%

Change in valuation allowance

 

 

(42.0

)

 

 

(54.7

)

 

 

(33.3

)

State taxes (net of federal benefit)

 

 

0.1

 

 

 

0.4

 

 

 

0.2

 

Federal research and development credit

 

 

18.6

 

 

 

16.5

 

 

 

8.5

 

Stock-based compensation

 

 

10.4

 

 

 

16.1

 

 

 

10.2

 

Inducement premium

 

 

—

 

 

 

5.0

 

 

 

(4.7

)

Unrecognized tax benefits

 

 

(4.7

)

 

 

(4.1

)

 

 

(2.1

)

Other, net

 

 

(2.8

)

 

 

(1.0

)

 

 

(0.1

)

Effective income tax rate

 

 

0.7

%

 

 

(0.8

%)

 

 

(0.3

%)
Summary of Significant Components Deferred Tax Assets and Liabilities

Deferred federal, state and foreign income taxes reflect the net tax impact of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and for tax purposes. The following

table presents the significant components of our deferred tax assets and liabilities as of the dates presented (in thousands):

 

 

 

 

 

 

 

December 31, 2023

 

 

December 31, 2022

 

Net operating loss carryforwards

 

$

49,228

 

 

$

53,157

 

Credit carryforwards

 

 

22,971

 

 

 

16,868

 

Capitalized research and development

 

 

32,988

 

 

 

17,072

 

Operating lease liabilities

 

 

2,569

 

 

 

3,011

 

Allowances

 

 

1,624

 

 

 

1,398

 

Deferred revenue

 

 

48

 

 

 

74

 

Stock-based compensation

 

 

6,351

 

 

 

6,041

 

Disallowed interest expense

 

 

—

 

 

 

676

 

Inventory cost capitalization

 

 

1,433

 

 

 

791

 

Deferred tax assets

 

 

117,211

 

 

 

99,088

 

Less: Valuation allowance

 

 

(114,040

)

 

 

(95,710

)

Net deferred tax assets

 

 

3,171

 

 

 

3,378

 

Deferred tax liability:

 

 

 

 

 

 

Goodwill

 

 

(823

)

 

 

(796

)

Depreciation and amortization

 

 

(3,326

)

 

 

(475

)

Operating lease ROU assets

 

 

(1,933

)

 

 

(2,226

)

Deferred tax liabilities

 

 

(6,082

)

 

 

(3,497

)

Net deferred tax liability

 

$

(2,911

)

 

$

(119

)
Total Balance of Unrecognized Tax Benefits

The following table presents the total balance of unrecognized tax benefits as of the dates presented (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Balance at beginning of period

 

$

5,606

 

 

$

4,609

 

 

$

3,519

 

Gross increase to tax positions in current periods

 

 

2,034

 

 

 

997

 

 

 

1,090

 

Balance at end of period

 

$

7,640

 

 

$

5,606

 

 

$

4,609

 
v3.24.0.1
Long-term Debt (Tables)
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
Summary of Outstanding Principal Amount and Carrying Value

The following table presents the outstanding principal amount and carrying value of the 2021 Notes as of the dates indicated (in thousands):

 

 

 

December 31, 2023

 

 

December 31, 2022

 

 

 

Principal Amount

 

 

Unamortized debt issuance costs

 

 

Net Carrying Amount

 

 

Principal Amount

 

 

Unamortized debt issuance costs

 

 

Net Carrying Amount

 

2021 Notes

 

 

287,500

 

 

 

(5,645

)

 

 

281,855

 

 

 

287,500

 

 

 

(7,256

)

 

 

280,244

 
Schedule of Notes

Further details of the 2021 Notes are as follows:

 

Issuance

 

Maturity Date

 

Interest Rate

 

First Interest Payment Date

 

Effective Interest Rate

 

Semi-Annual Interest Payment Dates

 

Initial Conversion Rate per $1,000 Principal

 

Initial Conversion Price

 

 

Number of Shares (in millions) (1)

2021 Notes

 

May 15, 2027

 

1.125%

 

May 15, 2022

 

1.72%

 

May 15; November 15

 

9.0061

 

$

111.04

 

 

2.6

 
Schedule of Interest Expense

Interest expense related to the Notes was as follows (in thousands):

 

 

Year Ended December 31, 2023

 

 

Year Ended December 31, 2022

 

 

Year Ended December 31, 2021

 

 

 

2021 Notes

 

 

2019 Notes

 

 

2021 Notes

 

 

Total

 

 

2019 Notes

 

 

2021 Notes

 

 

Total

 

Amortization of debt issuance costs

 

 

1,612

 

 

 

19

 

 

 

1,583

 

 

 

1,602

 

 

 

329

 

 

 

239

 

 

 

568

 

Cash interest expense

 

 

3,236

 

 

 

87

 

 

 

3,234

 

 

 

3,321

 

 

 

1,488

 

 

 

494

 

 

 

1,982

 

Total interest expense

 

$

4,848

 

 

$

106

 

 

$

4,817

 

 

$

4,923

 

 

$

1,817

 

 

$

733

 

 

$

2,550

 
v3.24.0.1
Stock-Based Awards (Tables)
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
Summary of Stock-Based Compensation Expense

The following table presents the detail of stock-based compensation expense amounts included in our consolidated statements of operations for the periods presented (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Cost of revenue

$

1,869

 

 

$

1,522

 

 

$

1,869

 

Research and development expense

 

21,307

 

 

 

17,961

 

 

 

17,170

 

Sales and marketing expense

 

10,240

 

 

 

9,447

 

 

 

9,496

 

General and administrative expense

 

14,570

 

 

 

13,513

 

 

 

11,963

 

Total stock-based compensation expense

$

47,986

 

 

$

42,443

 

 

$

40,498

 
Summary of Stock Options Activity The following table summarizes option award activity for the year ended December 31, 2023 (in thousands, except per share data and years):

 

 

Number of
Underlying Shares

 

 

Weighted-Average
Exercise Price
Per Share

 

 

Weighted-Average
Remaining
Contractual
Life (Years)

 

 

Total Intrinsic
Value

 

Outstanding at December 31, 2022

 

 

1,712

 

 

$

25.09

 

 

 

5.92

 

 

$

143,996

 

Granted

 

 

—

 

 

 

—

 

 

 

 

 

 

 

Exercised

 

 

(243

)

 

 

22.72

 

 

 

 

 

 

 

Forfeited or expired

 

 

(3

)

 

 

27.72

 

 

 

 

 

 

 

Outstanding at December 31, 2023

 

 

1,466

 

 

 

25.48

 

 

 

4.97

 

 

 

94,650

 

Vested and exercisable at December 31, 2023

 

 

1,408

 

 

$

25.35

 

 

 

4.91

 

 

$

91,089

 
Schedule of Stock Options Valuation Assumptions

We estimate the fair value of options granted at the date of grant using the Black-Scholes option-pricing model with the following assumptions for the periods presented:

 

 

Year Ended December 31,

 

 

 

2023

 

2022

 

2021

 

Risk-free interest rate

 

N/A

 

N/A

 

0.8% - 1.2%

 

Expected dividends yield

 

N/A

 

N/A

 

None

 

Expected volatility

 

N/A

 

N/A

 

71.2% - 72.4%

 

Weighted-average expected term

 

N/A

 

N/A

 

 

6.08

 

Weighted-average fair value of options granted

 

N/A

 

N/A

 

$

36.94

 
Summary of Restricted Stock Units

The following table summarizes activity for restricted stock units, or RSUs, PSUs, and MSUs for the year ended December 31, 2023 (in thousands, except per share data):

 

 

Number of Underlying Shares

 

 

Weighted-Average Grant Date Fair Value

 

 

 

RSUs

 

 

MSUs

 

 

PSUs

 

 

RSUs

 

 

MSUs

 

 

PSUs

 

Outstanding at December 31, 2022

 

 

 

1,310

 

 

 

110

 

 

 

74

 

 

$

56.92

 

 

$

80.40

 

 

$

64.03

 

Granted

 

 

 

441

 

 

 

126

 

 

 

—

 

 

 

119.12

 

 

 

145.51

 

 

 

—

 

Vested

 

 

 

(633

)

 

 

(58

)

 

 

(57

)

 

 

52.92

 

 

 

39.15

 

 

 

64.03

 

Forfeited

 

 

 

(40

)

 

 

(4

)

 

 

(17

)

 

 

71.49

 

 

 

185.49

 

 

 

64.03

 

Outstanding at December 31, 2023

 

 

 

1,078

 

 

 

174

 

 

 

—

 

 

$

84.18

 

 

$

138.77

 

 

$

—

 

We record stock-based compensation expense for RSUs and MSUs on a straight-line basis over the requisite service period, which is generally the vesting period. We record stock-based compensation for PSUs based on the probability of achieving the performance criteria defined in the PSU agreements. Forfeitures are recognized as they occur.
Summary of Information Related to Granted and Vested RSUs, PSUs and MSUs

The following table summarizes information related to granted and vested RSUs, PSUs, and MSUs (in thousands, except per share data):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

RSU weighted-average grant date fair value

$

119.12

 

 

$

65.81

 

 

$

56.40

 

MSU weighted-average grant date fair value

 

145.51

 

 

 

81.22

 

 

 

77.01

 

PSU weighted-average grant date fair value

$

—

 

 

$

64.07

 

 

$

54.67

 

 

 

 

 

 

 

 

 

 

Fair market value of RSUs vested

$

64,417

 

 

$

32,871

 

 

$

18,228

 

Fair market value of MSUs vested

 

7,219

 

 

 

—

 

 

 

—

 

Fair market value of PSUs vested

$

7,261

 

 

$

18,873

 

 

$

15,384

 
Schedule of Employee Stock Purchase Plan Valuation Assumptions

We estimate the fair value of the ESPP grant at the start of the offering period using the Black-Scholes option-pricing model with the following assumptions for the periods presented:

 

 

Year Ended December 31,

 

2023

 

2022

 

2021

Risk-free interest rate

 

5.1% - 5.6%

 

0.7% - 3.2%

 

0.0% - 0.1%

Expected term

 

0.5 Years

 

0.5 Years

 

0.5 Years

Expected volatility

 

64.7% - 85.9%

 

71.9% - 76.3%

 

61.0% - 65.8%
v3.24.0.1
Leases (Tables)
 12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
Components of Lease Expense

The following table presents the components of lease expense in our consolidated statements of operations for the periods presented (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Operating lease costs(1)

 

 

 

 

 

 

 

 

Single lease costs

$

3,486

 

 

$

4,299

 

 

$

4,154

 

Variable lease costs

 

1,280

 

 

 

2,159

 

 

 

1,910

 

Sublease income(2)

 

(165

)

 

 

(1,976

)

 

 

(1,900

)

Total operating lease costs

$

4,601

 

 

$

4,482

 

 

$

4,164

 

(1) Includes short-term lease costs, which are immaterial.

 

(2) Sublease income is related to unused office space that we sublet as part of the fiscal 2018 restructuring where we continue to have the primary obligations.

 
Supplemental Cash Flow Information Related to Operating Leases

The following table presents supplemental cash flow information related to operating leases for the periods presented (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Cash paid for amounts included in the measurement of lease liabilities

 

 

 

 

 

 

 

 

Operating cash flows used

$

4,233

 

 

$

5,097

 

 

$

4,895

 

Lease liabilities arising from remeasurement of right-of-use assets

 

 

 

 

 

 

 

 

Operating leases

$

159

 

 

$

—

 

 

$

698

 

Lease liabilities arising from obtaining ROU assets

 

 

 

 

 

 

 

 

Operating leases

$

1,690

 

 

$

2,237

 

 

$

—

 
Schedule of Weighted-Average Remaining Lease Terms and Weighted-Average Discount Rate Related to Operating Leases

The following table presents weighted-average remaining lease term and weighted-average discount rate related to operating leases as of:

 

2023

 

 

2022

 

Weighted-average remaining lease term (years)

 

3.7

 

 

 

4.3

 

Weighted-average discount rate

 

6.9

%

 

 

6.9

%

 
Schedule of Future Lease Payments under Operating Leases

The following table presents future lease payments under operating leases as of December 31, 2023 (in thousands):

 

 

Operating Leases

 

 

 

Lease Payments

 

2024

 

$

4,120

 

2025

 

 

4,129

 

2026

 

 

4,201

 

2027

 

 

775

 

2028

 

 

642

 

Thereafter

 

 

549

 

Total lease payments

 

$

14,416

 

Less: Imputed interest

 

 

(1,683

)

Present value of lease liabilities

 

 

12,733

 

Less: Current portion of lease liabilities

 

 

3,373

 

Lease liabilities, net of current portion

 

$

9,360

 
v3.24.0.1
Deferred Revenue (Tables)
 12 Months Ended
Dec. 31, 2023
Deferred Revenue Disclosure [Abstract]  
Summary of Changes in Deferred Revenue

The following table presents the changes in deferred revenue for the indicated periods (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

Balance at beginning of period

$

2,599

 

 

$

794

 

Balance from acquisition

 

1,233

 

 

 

—

 

Deferral of revenue

 

2,920

 

 

 

3,143

 

Recognition of deferred revenue

 

(4,767

)

 

 

(1,338

)

Balance at end of period

$

1,985

 

 

$

2,599

 

 
v3.24.0.1
Segment Reporting (Tables)
 12 Months Ended
Dec. 31, 2023
Segment Reporting [Abstract]  
Summary of Revenue Categories The following table presents our revenue categories for the indicated periods (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Endpoint ICs

 

$

234,426

 

 

$

191,532

 

 

$

139,250

 

Systems

 

 

73,113

 

 

 

66,268

 

 

 

51,033

 

Total revenue

 

$

307,539

 

 

$

257,800

 

 

$

190,283

 
Summary of Long-lived Assets by Geography

The following table summarizes our long-lived assets, comprising property and equipment, less accumulated depreciation (in thousands):

 

December 31, 2023

 

 

December 31, 2022

 

United States

 

$

14,110

 

 

$

10,551

 

Malaysia

 

 

11,749

 

 

 

12,817

 

Taiwan

 

 

13,396

 

 

 

12,620

 

Others

 

 

5,636

 

 

 

3,039

 

Total

 

$

44,891

 

 

$

39,027

 
Summary of Sales by Geography The following table presents our sales by geography for the indicated periods (in thousands):

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Americas

 

$

96,418

 

 

$

57,129

 

 

$

38,021

 

Asia Pacific

 

 

176,409

 

 

 

168,249

 

 

 

133,152

 

Europe, Middle East and Africa

 

 

34,712

 

 

 

32,422

 

 

 

19,110

 

Total revenue

 

$

307,539

 

 

$

257,800

 

 

$

190,283

 
v3.24.0.1
Net Loss Per Share (Tables)
 12 Months Ended
Dec. 31, 2023
Earnings Per Share [Abstract]  
Reconciliation of the Numerator and Denominator used in Computing Basic and Diluted Net Loss Per Share

For the periods presented, the following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net loss per share (in thousands, except for per-share amounts):

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

 

2021

 

Numerator:

 

 

 

 

 

 

 

 

 

Net loss

 

$

(43,366

)

 

$

(24,301

)

 

$

(51,260

)

Denominator:

 

 

 

 

 

 

 

 

 

Weighted-average shares outstanding — basic and diluted

 

 

26,752

 

 

 

25,539

 

 

 

24,176

 

Net loss per share — basic and diluted

 

$

(1.62

)

 

$

(0.95

)

 

$

(2.12

)
Computation of Diluted Net Loss Per Share Effect in Antidilutive

The following table presents the outstanding shares of our common stock equivalents excluded from the computation of diluted net loss per share as of the dates presented because their effect would have been antidilutive (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Stock options

 

1,466

 

 

 

1,712

 

 

 

2,288

 

RSUs, MSUs and PSUs

 

1,252

 

 

 

1,494

 

 

 

1,517

 

Employee stock purchase plan shares

 

51

 

 

 

26

 

 

 

42

 

2019 Notes

 

—

 

 

 

—

 

 

 

285

 

2021 Notes

 

2,589

 

 

 

2,589

 

 

 

2,589

 
v3.24.0.1
Summary of Significant Accounting Policies - Schedule of Revenue and Accounts Receivable Concentration (Details)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Customer Concentration Risk | Revenue | Avery Dennison      
Concentration Risk [Line Items]      
Concentration risk percentage 33.00% 28.00% 32.00%
Customer Concentration Risk | Revenue | Arizon      
Concentration Risk [Line Items]      
Concentration risk percentage 11.00% 10.00% 11.00%
Customer Concentration Risk | Revenue | Top Two Customers      
Concentration Risk [Line Items]      
Concentration risk percentage 44.00% 38.00% 43.00%
Credit Concentration Risk | Accounts Receivable | Avery Dennison      
Concentration Risk [Line Items]      
Concentration risk percentage 39.00% 24.00%  
Credit Concentration Risk | Accounts Receivable | Arizon      
Concentration Risk [Line Items]      
Concentration risk percentage 11.00% 13.00%  
Credit Concentration Risk | Accounts Receivable | Top Four Customers      
Concentration Risk [Line Items]      
Concentration risk percentage 50.00% 37.00%  
v3.24.0.1
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Jan. 01, 2021
Significant Accounting Policies [Line Items]        
Inventory excess and obsolescence charges, unfavorable impact on gross margin percentage     1.50%  
Amortization expense associated with cloud computing arrangements $ 500,000 $ 400,000 $ 200,000  
Sales commissions maximum amortization period 1 year      
Sales contracts with original expected length one year or less      
Cumulative ownership change percentage 50.00%      
Cumulative change in ownership period 3 years      
Investment impairment charges $ 0 0 $ 0  
Long-term debt 281,855,000 280,244,000    
Additional paid in capital (463,900,000) (403,599,000)    
Accumulated deficit $ 430,151,000 386,785,000    
ASU 2020-06        
Significant Accounting Policies [Line Items]        
Change in accounting principle, accounting standards update, adopted true      
Change in accounting principle, accounting standards update, adoption date Jan. 01, 2021      
Change in accounting principle, accounting standards update, immaterial effect false      
ASU 2020-06 | Change in Accounting Method Accounted for as Change in Estimate | Revision of Prior Period, Accounting Standards Update, Adjustment        
Significant Accounting Policies [Line Items]        
Long-term debt       $ 29,300,000
Additional paid in capital       32,700,000
Accumulated deficit       $ 3,400,000
Level 3        
Significant Accounting Policies [Line Items]        
Assets measured at fair value $ 0 0    
Financial liabilities, fair value $ 0 0    
Maximum        
Significant Accounting Policies [Line Items]        
Expected revenue recognition term 1 year      
Extended warranty and enhanced maintenance term 3 years      
Payment Terms 120 days      
Product warranty coverage period 1 year      
Lease expiration year 2029      
Minimum        
Significant Accounting Policies [Line Items]        
Extended warranty and enhanced maintenance term 1 year      
Payment Terms 30 days      
Product warranty coverage period 90 days      
Lease expiration year 2024      
Prepaid Expenses and Other Current Assets        
Significant Accounting Policies [Line Items]        
Cloud computing arrangement costs $ 400,000 400,000    
Other Non-current Assets        
Significant Accounting Policies [Line Items]        
Cloud computing arrangement costs $ 1,400,000 $ 1,800,000    
2021 Convertible Senior Notes due 2027        
Significant Accounting Policies [Line Items]        
Debt instrument, maturity year 2027      
v3.24.0.1
Summary of Significant Accounting Policies - Summary of Allowance for Sales Returns (Details) - Allowance for Sales Returns and Price Exceptions - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Valuation And Qualifying Accounts Disclosure [Line Items]      
Balance at Beginning of Year $ 605 $ 947 $ 406
Additional Reserve 2,912 1,899 2,780
Applied Sales Return 2,840 (2,241) (2,239)
Balance at End of Year $ 677 $ 605 $ 947
v3.24.0.1
Summary of Significant Accounting Policies - Schedule of Property and Equipment Estimated Useful Lives (Details)
Dec. 31, 2023
Leasehold Improvements  
Property Plant And Equipment [Line Items]  
Property, Plant, and Equipment, Useful Life, Term, Description [Extensible Enumeration] us-gaap:UsefulLifeShorterOfTermOfLeaseOrAssetUtilityMember
Minimum | Machinery and Equipment  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 1 year
Minimum | Computer Equipment and Software  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 3 years
Minimum | Furniture and Fixtures  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 3 years
Minimum | Equipment Acquired Under Finance Leases  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 3 years
Maximum | Machinery and Equipment  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 10 years
Maximum | Computer Equipment and Software  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 5 years
Maximum | Furniture and Fixtures  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 7 years
Maximum | Equipment Acquired Under Finance Leases  
Property Plant And Equipment [Line Items]  
Property and equipment, estimated useful lives (Years) 7 years
v3.24.0.1
Fair Value Measurements - Summary of Assets Measured at Fair Value on Recurring Basis (Details) - USD ($)
Dec. 31, 2023
Dec. 31, 2022
Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value $ 97,101,000 $ 187,968,000
Acquisition-related contingent consideration liability 6,180,000  
Total liabilities at fair value 6,180,000  
Cash Equivalents | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 78,661,000 14,620,000
Cash Equivalents | Money Market Funds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 78,661,000 14,620,000
Short-term Investments | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 18,440,000 154,148,000
Short-term Investments | U.S. Government Agency Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 11,893,000 78,621,000
Short-term Investments | Corporate Notes and Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   26,953,000
Short-term Investments | Commercial Paper | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   24,073,000
Short-term Investments | Treasury Bill | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   11,359,000
Short-term Investments | Yankee Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 1,951,000 1,939,000
Short-term Investments | Agency Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 2,994,000 2,882,000
Short-term Investments | Asset-Backed Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 1,602,000 8,321,000
Long-term Investments | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   19,200,000
Long-term Investments | U.S. Government Agency Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   13,462,000
Long-term Investments | Yankee Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   1,869,000
Long-term Investments | Agency Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   2,983,000
Long-term Investments | Asset-Backed Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   886,000
Level 1 | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 78,661,000 14,620,000
Level 1 | Cash Equivalents | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 78,661,000 14,620,000
Level 1 | Cash Equivalents | Money Market Funds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 78,661,000 14,620,000
Level 2 | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 18,440,000 173,348,000
Level 2 | Short-term Investments | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 18,440,000 154,148,000
Level 2 | Short-term Investments | U.S. Government Agency Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 11,893,000 78,621,000
Level 2 | Short-term Investments | Corporate Notes and Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   26,953,000
Level 2 | Short-term Investments | Commercial Paper | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   24,073,000
Level 2 | Short-term Investments | Treasury Bill | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   11,359,000
Level 2 | Short-term Investments | Yankee Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 1,951,000 1,939,000
Level 2 | Short-term Investments | Agency Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 2,994,000 2,882,000
Level 2 | Short-term Investments | Asset-Backed Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 1,602,000 8,321,000
Level 2 | Long-term Investments | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   19,200,000
Level 2 | Long-term Investments | U.S. Government Agency Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   13,462,000
Level 2 | Long-term Investments | Yankee Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   1,869,000
Level 2 | Long-term Investments | Agency Bonds | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   2,983,000
Level 2 | Long-term Investments | Asset-Backed Securities | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value   886,000
Level 3    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 0 $ 0
Level 3 | Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Acquisition-related contingent consideration liability 6,180,000  
Total liabilities at fair value $ 6,180,000  
v3.24.0.1
Fair Value Measurements - Schedule of Additional Information of Liabilities Measured at Fair Value for Company Utilized Level 3 Inputs to Determine Fair Value (Details) - Contingent Consideration Liability
$ in Thousands
 12 Months Ended
Dec. 31, 2023
USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]  
Addition of contingent consideration liability due to acquisition $ 4,602
Change in fair value of contingent consideration liability due to remeasurement 1,578
Ending balance $ 6,180
v3.24.0.1
Fair Value Measurements - Additional Information (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Marketable securities continuous loss position for less than 12 months, estimated fair value $ 10,200,000 $ 125,600,000
Marketable securities continuous loss position for less than 12 months, unrealized losses 20,000.00 1,200,000
Marketable securities continuous loss position for greater than 12 months, estimated fair value 8,200,000 13,900,000
Marketable securities continuous loss position for greater than 12 months, unrealized losses $ 30,000.00 100,000
2021 Convertible Senior Notes due 2027    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Debt instrument, maturity year 2027  
Accrued Expenses And Other Current Liabilities    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Contingent consideration liability $ 6,200,000  
General and Administrative Expense    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Fair value of the contingent consideration liability measurement additional expense 1,600,000  
Level 3    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 0 0
Fair Value Measurements Recurring    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Assets measured at fair value 97,101,000 $ 187,968,000
Liabilities measured at fair value 6,180,000  
Contingent consideration liability 6,180,000  
Fair Value Measurements Recurring | Level 3    
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]    
Liabilities measured at fair value 6,180,000  
Contingent consideration liability $ 6,180,000  
v3.24.0.1
Fair Value Measurements - Schedule of Cost Or Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, And Total Estimated Fair Value Of Financial Assets (Details) - Fair Value Measurements Recurring - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost $ 97,151 $ 189,217
Gross Unrealized Gains   14
Gross Unrealized Losses (50) (1,263)
Total Estimated Fair Value 97,101 187,968
Money Market Funds    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost 78,661 14,620
Total Estimated Fair Value 78,661 14,620
U.S. Government Agency Securities    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost 11,932 93,065
Gross Unrealized Losses (39) (982)
Total Estimated Fair Value 11,893 92,083
Corporate Notes and Bonds    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost   27,133
Gross Unrealized Gains   6
Gross Unrealized Losses   (186)
Total Estimated Fair Value   26,953
Yankee Bonds    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost 1,956 3,815
Gross Unrealized Losses (5) (7)
Total Estimated Fair Value 1,951 3,808
Commercial Paper    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost   24,073
Total Estimated Fair Value   24,073
Treasury Bill    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost   11,361
Gross Unrealized Gains   2
Gross Unrealized Losses   (4)
Total Estimated Fair Value   11,359
Agency Bonds    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost 2,998 5,863
Gross Unrealized Gains   4
Gross Unrealized Losses (4) (2)
Total Estimated Fair Value 2,994 5,865
Asset-Backed Securities    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Cost or Amortized Cost 1,604 9,287
Gross Unrealized Gains   2
Gross Unrealized Losses (2) (82)
Total Estimated Fair Value $ 1,602 $ 9,207
v3.24.0.1
Inventory - Schedule of Inventories (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Inventory Disclosure [Abstract]    
Raw materials $ 21,773 $ 14,678
Work-in-process 42,217 14,525
Finished goods 33,182 17,194
Total inventory $ 97,172 $ 46,397
v3.24.0.1
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($)
Dec. 31, 2023
Dec. 31, 2022
Property Plant And Equipment [Line Items]    
Total property and equipment, gross $ 76,550,000 $ 66,610,000
Less: Accumulated depreciation (31,659,000) (27,583,000)
Total property and equipment, net 44,891,000 39,027,000
Machinery and Equipment    
Property Plant And Equipment [Line Items]    
Total property and equipment, gross 57,511,000 48,420,000
Computer Equipment and Software    
Property Plant And Equipment [Line Items]    
Total property and equipment, gross 3,012,000 3,308,000
Furniture and Fixtures    
Property Plant And Equipment [Line Items]    
Total property and equipment, gross 1,333,000 1,303,000
Equipment Acquired Under Finance Leases    
Property Plant And Equipment [Line Items]    
Total property and equipment, gross 1,728,000 2,895,000
Total property and equipment, net 0 0
Leasehold Improvements    
Property Plant And Equipment [Line Items]    
Total property and equipment, gross $ 12,966,000 $ 10,684,000
v3.24.0.1
Property and Equipment - Additional Information (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Property Plant And Equipment [Line Items]      
Depreciation $ 8,700,000 $ 6,000,000 $ 4,600,000
Property and equipment, net 44,891,000 39,027,000  
Equipment Acquired Under Finance Leases      
Property Plant And Equipment [Line Items]      
Property and equipment, net $ 0 $ 0  
v3.24.0.1
Goodwill and Intangible Assets - Additional Information (Details) - USD ($)
 12 Months Ended
Apr. 03, 2023
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Goodwill [Line Items]        
Weighted average life of intangible assets   6 years    
Amortization expense of intangible assets   $ 4,953,000 $ 0  
Goodwill   19,696,000 $ 3,881,000 $ 3,881,000
Deferred tax liability $ 3,700,000      
Accrued Expenses And Other Current Liabilities        
Goodwill [Line Items]        
Contingent consideration liability   $ 6,200,000    
Voyantic Oy        
Goodwill [Line Items]        
Purchase price 32,700,000      
Consideration value of common stock 3,600,000      
Fair value of net assets acquired 2,400,000      
Goodwill 15,600,000      
Intangible assets 18,400,000      
Deferred tax liability 3,700,000      
Deferred payments 4,600,000      
Voyantic Oy | General and Administrative Expense        
Goodwill [Line Items]        
Transaction-related costs for acquisition 1,700,000      
Contingent consideration additional amount $ 1,600,000      
v3.24.0.1
Goodwill and Intangible Assets - Schedule of Goodwill (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]  
Balance at beginning of period $ 3,881
Additions from acquisition 15,590
Foreign currency translation adjustment 225
Total $ 19,696
v3.24.0.1
Goodwill and Intangible Assets - Schedule of Intangible Assets (Details)
$ in Thousands
Dec. 31, 2023
USD ($)
Finite-Lived Intangible Assets [Line Items]  
Estimated Useful Life in Years 6 years
Gross Carrying Amount $ 18,959
Accumulated Amortization (5,046)
Net Total $ 13,913
Backlog  
Finite-Lived Intangible Assets [Line Items]  
Estimated Useful Life in Years 3 months
Gross Carrying Amount $ 773
Accumulated Amortization $ (773)
Customer Relationships  
Finite-Lived Intangible Assets [Line Items]  
Estimated Useful Life in Years 1 year
Gross Carrying Amount $ 3,698
Accumulated Amortization (2,773)
Net Total $ 925
Developed Technology  
Finite-Lived Intangible Assets [Line Items]  
Estimated Useful Life in Years 7 years 3 months
Gross Carrying Amount $ 13,024
Accumulated Amortization (1,348)
Net Total $ 11,676
Patent  
Finite-Lived Intangible Assets [Line Items]  
Estimated Useful Life in Years 3 years
Gross Carrying Amount $ 250
Accumulated Amortization (38)
Net Total $ 212
Trade Names  
Finite-Lived Intangible Assets [Line Items]  
Estimated Useful Life in Years 8 years
Gross Carrying Amount $ 1,214
Accumulated Amortization (114)
Net Total $ 1,100
v3.24.0.1
Goodwill and Intangible Assets - Schedule of Estimated Intangible Asset Amortization Expense (Details)
$ in Thousands
Dec. 31, 2023
USD ($)
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]  
2024 $ 2,956
2025 2,032
2026 1,993
2027 1,948
2028 1,948
Thereafter 3,036
Net Total $ 13,913
v3.24.0.1
Income Taxes - Summary of Components of Income (Loss) before Income Taxes (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Income Tax Disclosure [Abstract]      
U.S. $ (40,349) $ (24,508) $ (51,488)
Foreign (3,339) 391 381
Loss before income taxes $ (43,688) $ (24,117) $ (51,107)
v3.24.0.1
Income Taxes - Summary of Income Tax Benefit (Expense) (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Current:      
U.S. - State $ (163) $ (68) $ (8)
Foreign (446) (110) (137)
Total current (609) (178) (145)
Deferred:      
U.S. - Federal (53) 5 (7)
U.S. - State   (11) (1)
Foreign 984    
Total deferred 931 (6) (8)
Total income tax expense $ 322 $ (184) $ (153)
v3.24.0.1
Income Taxes - Reconciliation of U.S. Federal Statutory Income Tax Rate to Effective Income Tax Rate (Details)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Income Tax Disclosure [Abstract]      
U.S. Statutory Rate 21.00% 21.00% 21.00%
Change in valuation allowance (42.00%) (54.70%) (33.30%)
State taxes (net of federal benefit) 0.10% 0.40% 0.20%
Federal research and development credit 18.60% 16.50% 8.50%
Stock-based compensation 10.40% 16.10% 10.20%
Inducement premium   5.00% (4.70%)
Unrecognized tax benefits (4.70%) (4.10%) (2.10%)
Other, net (2.80%) (1.00%) (0.10%)
Effective income tax rate 0.70% (0.80%) (0.30%)
v3.24.0.1
Income Taxes - Summary of Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Income Tax Disclosure [Abstract]    
Net operating loss carryforwards $ 49,228 $ 53,157
Credit carryforwards 22,971 16,868
Capitalized research and development 32,988 17,072
Operating lease liabilities 2,569 3,011
Allowances 1,624 1,398
Deferred revenue 48 74
Stock-based compensation 6,351 6,041
Disallowed interest expense   676
Inventory cost capitalization 1,433 791
Deferred tax assets 117,211 99,088
Less: Valuation allowance (114,040) (95,710)
Net deferred tax assets 3,171 3,378
Deferred tax liability:    
Goodwill (823) (796)
Depreciation and amortization (3,326) (475)
Operating lease ROU assets (1,933) (2,226)
Deferred tax liabilities (6,082) (3,497)
Net deferred tax liability $ (2,911) $ (119)
v3.24.0.1
Income Taxes - Additional Information (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Apr. 03, 2023
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Income Tax Disclosure [Line Items]          
Deferred tax liability   $ 3,700,000      
Accumulated federal tax losses $ 230,500,000   $ 249,300,000    
Accumulated federal tax losses with indefinite life 141,900,000        
Accumulated state tax losses 21,300,000   21,700,000    
Research and development credit carry-forwards $ 30,500,000   22,300,000    
Federal tax losses and research and development credit carryforward expiration year 2020        
Unrecognized tax benefits $ 7,640,000   $ 5,606,000 $ 4,609,000 $ 3,519,000
Accrued interest and penalties related to unrecognized tax benefits 0        
Unrecognized tax benefits, if recognized would impact the effective tax rate 0        
Tax cut job act, impact of provision in deferred tax assets $ 32,900,000        
Voyantic Oy          
Income Tax Disclosure [Line Items]          
Deferred tax liability   $ 3,700,000      
v3.24.0.1
Income Taxes - Total Balance of Unrecognized Tax Benefits (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Income Tax Disclosure [Abstract]      
Balance at beginning of period $ 5,606 $ 4,609 $ 3,519
Gross increase to tax positions in current periods 2,034 997 1,090
Balance at end of period $ 7,640 $ 5,606 $ 4,609
v3.24.0.1
Long-term Debt - Summary of Outstanding Principal Amount and Carrying Value (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Jun. 30, 2022
Nov. 30, 2021
2019 Convertible Senior Notes due 2026        
Debt Instrument [Line Items]        
Unamortized debt issuance costs     $ (200) $ (1,800)
2021 Convertible Senior Notes due 2027        
Debt Instrument [Line Items]        
Principal Amount $ 287,500 $ 287,500    
Unamortized debt issuance costs (5,645) (7,256)    
Net Carrying Amount $ 281,855 $ 280,244    
v3.24.0.1
Long-term Debt - Additional Information (Details)
$ / shares in Units, $ in Thousands
 1 Months Ended 12 Months Ended
Dec. 11, 2019
Jun. 30, 2022
USD ($)
Nov. 30, 2021
USD ($)
Dec. 31, 2019
USD ($)
Days
$ / shares
Dec. 31, 2023
USD ($)
Days
Dec. 31, 2022
USD ($)
Dec. 31, 2021
USD ($)
Jan. 01, 2021
USD ($)
Debt Instrument [Line Items]                
Debt instrument, threshold trading days | Days         5      
Number of business day | Days         5      
Long-term debt         $ 281,855 $ 280,244    
Additional paid in capital         (463,900) (403,599)    
Accumulated deficit         430,151 386,785    
Induced conversion expense related to convertible notes           2,232 $ 11,333  
ASU 2020-06 | Change in Accounting Method Accounted for as Change in Estimate | Revision of Prior Period, Accounting Standards Update, Adjustment                
Debt Instrument [Line Items]                
Long-term debt               $ 29,300
Additional paid in capital               32,700
Accumulated deficit               $ 3,400
2021 Convertible Promissory Notes due 2027                
Debt Instrument [Line Items]                
Aggregate principal amount     $ 287,500          
Debt instrument, maturity date     May 15, 2027          
2021 Convertible Promissory Notes due 2027 | Level 2                
Debt Instrument [Line Items]                
Estimated fair value         314,000 347,400    
2019 Convertible Senior Notes due 2026                
Debt Instrument [Line Items]                
Aggregate principal amount       $ 86,300        
Repurchase of debt principal amount   $ 9,900 $ 76,400          
Debt instrument, borrowing interest rate percentage       9.90%        
Fair value of liability component upon issuance       $ 52,500        
Initial carrying amount of liability component recognized as debt discount       33,800        
Proceeds from convertible debt       86,300        
Adjustments recorded in additional paid-in capital       33,800        
Total issuance costs       2,800        
Liability issuance costs       1,700        
Equity issuance costs       $ 1,100        
Cap price of the capped call transactions | $ / shares       $ 54.2        
Capped call transactions expiration consecutive days | Days       40        
Capped call transaction expiring date Dec. 11, 2026              
Payment of 2019 Notes   17,600 183,600          
Induced conversion expense related to convertible notes   2,200 11,300          
Unamortized debt issuance costs   200 1,800          
2019 Convertible Senior Notes due 2026 | 2019 Note Repurchase                
Debt Instrument [Line Items]                
Payment of 2019 Notes   17,600 183,600          
Repurchase of debt principal amount   $ 9,900 $ 76,400          
2021 Convertible Senior Notes due 2027                
Debt Instrument [Line Items]                
Debt instrument, maturity date     May 15, 2027          
Net proceeds from issuing notes     $ 278,400          
Total issuance costs     $ 9,100          
Accrued interest         400 400    
Unamortized debt issuance costs         $ 5,645 $ 7,256    
Convertible Senior Notes                
Debt Instrument [Line Items]                
Debt instrument, threshold consecutive trading days | Days         30      
Debt instrument, threshold percentage of stock price trigger         130.00%      
Debt instrument, terms of conversion feature         Regardless of the foregoing circumstances, holders may convert all or any portion of the 2021 Notes, in increments of $1,000 principal amount, on or after February 15, 2027, until the close of business on the second scheduled trading day immediately preceding the maturity date.      
Percentage of repurchase price of principal amount         100.00%      
Convertible Senior Notes | Minimum                
Debt Instrument [Line Items]                
Debt instrument, threshold trading days | Days         20      
Convertible Senior Notes | Maximum                
Debt Instrument [Line Items]                
Debt instrument, threshold percentage of stock price trigger         98.00%      
v3.24.0.1
Long-term Debt - Schedule of Notes (Details) - 2021 Notes
Unit in Millions
 1 Months Ended
Nov. 30, 2021
Unit
$ / shares
shares
Debt Instrument [Line Items]  
Maturity Date May 15, 2027
Interest Rate 1.125%
First Interest Payment Date May 15, 2022
Effective Interest Rate 1.72%
Semi-Annual Interest Payment Dates May 15; November 15
Initial Conversion Rate per $1,000 Principal | shares 9.0061
Initial Conversion Price | $ / shares $ 111.04
Number of Shares (in millions) | Unit 2.6
v3.24.0.1
Long-term Debt - Schedule of Interest Expense (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
2019 Convertible Senior Notes due 2026      
Debt Instrument [Line Items]      
Amortization of debt issuance costs   $ 19 $ 329
Cash interest expense   87 1,488
Total interest expense   106 1,817
2021 Convertible Senior Notes due 2027      
Debt Instrument [Line Items]      
Amortization of debt issuance costs $ 1,612 1,583 239
Cash interest expense 3,236 3,234 494
Total interest expense $ 4,848 4,817 733
Convertible Senior Notes      
Debt Instrument [Line Items]      
Amortization of debt issuance costs   1,602 568
Cash interest expense   3,321 1,982
Total interest expense   $ 4,923 $ 2,550
v3.24.0.1
Stockholders' Equity - Additional Information (Details) - $ / shares
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Stockholders' Equity Note [Abstract]    
Preferred stock, shares issued 0 0
Preferred stock, shares outstanding 0 0
Common stock, shares authorized 495,000,000 495,000,000
Common stock, par value $ 0.001 $ 0.001
Common stock, voting rights Each holder of the common stock is entitled to one vote per common share  
v3.24.0.1
Stock-Based Awards - Summary of Stock-Based Compensation Expense (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]      
Total stock-based compensation expense $ 47,986 $ 42,443 $ 40,498
Cost of Revenue      
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]      
Total stock-based compensation expense 1,869 1,522 1,869
Research and Development Expense      
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]      
Total stock-based compensation expense 21,307 17,961 17,170
Selling and Marketing Expense      
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]      
Total stock-based compensation expense 10,240 9,447 9,496
General and Administrative Expense      
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]      
Total stock-based compensation expense $ 14,570 $ 13,513 $ 11,963
v3.24.0.1
Stock-Based Awards - Additional Information (Details) - USD ($)
$ in Thousands
 1 Months Ended 6 Months Ended 12 Months Ended
Jul. 31, 2016
Dec. 31, 2016
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2016
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Stock based compensation expense     $ 47,986 $ 42,443 $ 40,498  
Stock Option            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Total intrinsic value of options exercised     19,100 31,900 33,700  
Total grant date fair value of options vested     3,300 7,000 12,800  
Unrecognized stock-based compensation cost     $ 900      
Unrecognized stock-based compensation cost, period for recognition     6 months      
Performance Share Units            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Total fair market value of RSUs/PSUs/MSUs vested     $ 7,261 18,873 15,384  
Restricted Stock Units            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Unrecognized stock-based compensation cost     $ 78,400      
Unrecognized stock-based compensation cost, period for recognition     2 years 4 months 24 days      
Total fair market value of RSUs/PSUs/MSUs vested     $ 64,417 $ 32,871 $ 18,228  
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period     441,000      
MSU            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Unrecognized stock-based compensation cost, period for recognition     1 year 3 months 18 days      
Total fair market value of RSUs/PSUs/MSUs vested     $ 7,219      
Unrecognized stock-based compensation cost     $ 13,700      
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period     126,000      
2016 Equity Incentive Plan            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Incentive plan effective date     Jul. 31, 2016      
Shares of common stock reserved for future issuance, description     The number of shares of common stock reserved for issuance under the 2016 Plan may increase on January 1 of each year, beginning on January 1, 2017 and ending on and including January 1, 2026, by the lesser of (1) 1,825,000 shares; (2) 5% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; and (3) a lesser number of shares determined by our board of directors.      
Options granted, maximum term     10 years      
Options granted, exercisable term     4 years      
Common stock available for future grants     2,800,000      
2016 Equity Incentive Plan | Lower of Potential Outcome One            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Common stock capital incremental shares reserved for future issuance each year     1,825,000      
2016 Equity Incentive Plan | Lower of Potential Outcome Two            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Percentage of total number of shares of common stock outstanding     5.00%      
2016 Employee Stock Purchase Plan            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Common stock capital incremental shares reserved for future issuance each year     365,411      
Percentage of total number of shares of common stock outstanding           1.00%
Unrecognized stock-based compensation cost     $ 300      
Percentage of salary contribution by employees 15.00%          
Maximum number of shares purchase per employee   4,000        
Percentage of price lesser than fair market value per share 85.00%          
2016 Employee Stock Purchase Plan | Maximum            
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]            
Unrecognized stock-based compensation cost, period for recognition     1 year      
v3.24.0.1
Stock-Based Awards - Summary of Stock Options Activity (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]    
Number of Underlying Shares, Outstanding, Beginning balance 1,712  
Number of Underlying Shares, Exercised (243)  
Number of Underlying Shares, Forfeited or expired (3)  
Number of Underlying Shares, Outstanding, Ending balance 1,466 1,712
Number of Underlying Shares, Vested and exercisable 1,408  
Weighted-Average Exercise Price Per Share, Outstanding, Beginning balance $ 25.09  
Weighted-Average Exercise Price Per Share, Exercised 22.72  
Weighted-Average Exercise Price Per Share, Forfeited or Expired 27.72  
Weighted-Average Exercise Price Per Share, Outstanding, Ending balance 25.48 $ 25.09
Weighted-Average Exercise Price Per Share, Vested and exercisable $ 25.35  
Weighted-Average Remaining Contractual Life (Years), Outstanding 4 years 11 months 19 days 5 years 11 months 1 day
Weighted-Average Remaining Contractual Life (Years), Vested and exercisable 4 years 10 months 28 days  
Total Intrinsic Value, Outstanding $ 94,650 $ 143,996
Total Intrinsic Value, Vested and exercisable $ 91,089  
v3.24.0.1
Stock-Based Awards - Schedule of Stock Options Valuation Assumptions (Details) - Stock Options
 12 Months Ended
Dec. 31, 2021
$ / shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]  
Risk-free interest rates, minimum 0.80%
Risk-free interest rates, maximum 1.20%
Expected dividends yield 0.00%
Volatility, minimum 71.20%
Volatility, maximum 72.40%
Weighted-average expected term 6 years 29 days
Weighted-average fair value of options granted $ 36.94
v3.24.0.1
Stock-Based Awards - Summary of Restricted Stock Units (Details) - $ / shares
shares in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Restricted Stock Units      
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]      
Number of Underlying Shares Outstanding, Balance 1,310    
Number of Underlying Shares, Granted 441    
Number of Underlying Shares, Vested (633)    
Number of Underlying Shares, Forfeited (40)    
Number of Underlying Shares Outstanding, Balance 1,078 1,310  
Weighted-Average Grant-Date Fair Value , Beginning balance $ 56.92    
Weighted-Average Grant-Date Fair Value , Granted 119.12 $ 65.81 $ 56.4
Weighted-Average Exercise Price Per Share, Vested 52.92    
Weighted-Average Exercise Price Per Share, Forfeited 71.49    
Weighted-Average Grant-Date Fair Value , Ending balance $ 84.18    
Market and Service Conditions Units      
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]      
Number of Underlying Shares Outstanding, Balance 110    
Number of Underlying Shares, Granted 126    
Number of Underlying Shares, Vested (58)    
Number of Underlying Shares, Forfeited (4)    
Number of Underlying Shares Outstanding, Balance 174 110  
Weighted-Average Grant-Date Fair Value , Beginning balance $ 80.40    
Weighted-Average Grant-Date Fair Value , Granted 145.51 $ 81.22 77.01
Weighted-Average Exercise Price Per Share, Vested 39.15    
Weighted-Average Exercise Price Per Share, Forfeited 185.49    
Weighted-Average Grant-Date Fair Value , Ending balance $ 138.77    
Performance Share Units      
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]      
Number of Underlying Shares Outstanding, Balance 74    
Number of Underlying Shares, Vested (57)    
Number of Underlying Shares, Forfeited (17)    
Number of Underlying Shares Outstanding, Balance   74  
Weighted-Average Grant-Date Fair Value , Beginning balance $ 64.03    
Weighted-Average Grant-Date Fair Value , Granted   $ 64.07 $ 54.67
Weighted-Average Exercise Price Per Share, Vested 64.03    
Weighted-Average Exercise Price Per Share, Forfeited $ 64.03    
v3.24.0.1
Stock Based Awards - Summary of Information Related to Granted and Vested RSUs, PSUs and MSUs (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Restricted Stock Units      
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]      
Weighted-average grant date fair value $ 119.12 $ 65.81 $ 56.4
Fair market value of vested $ 64,417 $ 32,871 $ 18,228
Market and Service Conditions Units      
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]      
Weighted-average grant date fair value $ 145.51 $ 81.22 $ 77.01
Fair market value of vested $ 7,219    
Performance Share Units      
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]      
Weighted-average grant date fair value   $ 64.07 $ 54.67
Fair market value of vested $ 7,261 $ 18,873 $ 15,384
v3.24.0.1
Stock-Based Awards - Schedule of Employee Stock Purchase Plan Valuation Assumptions (Details) - Employee Stock Purchase Plan
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]      
Risk-free interest rates, minimum 5.10% 0.70% 0.00%
Risk-free interest rates, maximum 5.60% 3.20% 0.10%
Expected term 6 months 6 months 6 months
Volatility, minimum 64.70% 71.90% 61.00%
Volatility, maximum 85.90% 76.30% 65.80%
v3.24.0.1
Leases - Components of Lease Expense (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Operating lease costs      
Single lease costs $ 3,486 $ 4,299 $ 4,154
Variable lease costs 1,280 2,159 1,910
Sublease income:      
Sublease income (165) (1,976) (1,900)
Total operating lease costs $ 4,601 $ 4,482 $ 4,164
v3.24.0.1
Leases - Supplemental Cash Flow Information Related to Operating Leases (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Cash paid for amounts included in the measurement of lease liabilities      
Operating cash flows used $ 4,233 $ 5,097 $ 4,895
Lease liabilities arising from remeasurement of right-of-use assets      
Operating leases 159   $ 698
Lease liabilities arising from obtaining ROU assets      
Operating leases $ 1,690 $ 2,237  
v3.24.0.1
Leases - Schedule of Weighted-Average Remaining Lease Terms and Weighted-Average Discount Rate Related to Operating Leases (Details)
Dec. 31, 2023
Dec. 31, 2022
Leases [Abstract]    
Weighted-average remaining lease term (years) 3 years 8 months 12 days 4 years 3 months 18 days
Weighted-average discount rate 6.90% 6.90%
v3.24.0.1
Leases - Schedule of Future Lease Payments under Operating Leases (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Leases [Abstract]    
Operating Leases, Lease Payments, 2024 $ 4,120  
Operating Leases, Lease Payments, 2025 4,129  
Operating Leases, Lease Payments, 2026 4,201  
Operating Leases, Lease Payments, 2027 775  
Operating Leases, Lease Payments, 2028 642  
Operating Leases, Lease Payments, Thereafter 549  
Operating Leases, Lease Payments, Total lease payments 14,416  
Less: Imputed interest (1,683)  
Present value of lease liabilities 12,733  
Less: Current portion of lease liabilities 3,373 $ 3,122
Lease liabilities, net of current portion $ 9,360 $ 11,066
v3.24.0.1
Commitments and Contingencies - Additional Information (Details)
Nov. 09, 2023
USD ($)
Patent
Oct. 30, 2023
Patent
Oct. 20, 2023
USD ($)
Jul. 14, 2023
USD ($)
Feb. 10, 2022
Patent
Jul. 26, 2021
Patent
May 25, 2021
Patent
Feb. 12, 2021
Patent
Dec. 11, 2020
Patent
Dec. 07, 2020
Patent
Oct. 04, 2019
Patent
Jun. 06, 2019
Patent
Dec. 31, 2023
USD ($)
Dec. 31, 2022
USD ($)
Commitments And Contingencies [Line Items]                            
Number of infringement patents           1                
Inventory purchase commitment, amount | $                         $ 21,800,000  
Patent Infringement Claims                            
Commitments And Contingencies [Line Items]                            
Number of patents allegedly infringed                   3 8 26    
Number of patents found                       6    
Number of patents filed inter parties review with patent trail and appeal board                 6          
Number of asserted patents             7       4      
Number of asserted patents Invalid                     8      
Number of patents in suit pending final resolution of petitions                 8          
Number of patents on for IPRs               2            
Number of patents denied for IPRs               4            
Stay removed on number of patents               4            
Number of non-Infringement patents               6            
Number of limited patents               7            
Number of infringement patents 3         9 9 7            
Number of infringement patents exclusively licensed           8                
Number of patents proceedings instituted for reexamination           5                
Other defenses and awarded amount | $ $ 2,000,000                          
Percentage of royalty on infringing products 3.26%                          
Number of patents selected for each trial         3                  
Number originally selected patents for first trial   3                        
Patent Infringement Claims | U.S. District Court in Washington                            
Commitments And Contingencies [Line Items]                            
Number of asserted patents                   3        
Patent Infringement Claims | U.S. Patents NXP                            
Commitments And Contingencies [Line Items]                            
Number of asserted patents                   8        
Patent Infringement Claims of 302                            
Commitments And Contingencies [Line Items]                            
Damages awarded value | $       $ 18,200,000                    
Patent Infringement Claims of 597                            
Commitments And Contingencies [Line Items]                            
Damages awarded value | $     $ 13,100,000 $ 18,400,000                    
Accrued Liabilities                            
Commitments And Contingencies [Line Items]                            
Contingent liabilities | $                         $ 0 $ 0
v3.24.0.1
Deferred Revenue - Summary of Changes in Deferred Revenue (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Deferred Revenue Disclosure [Abstract]    
Balance at beginning of period $ 2,599 $ 794
Balance from acquisition 1,233  
Deferral of revenue 2,920 3,143
Recognition of deferred revenue (4,767) (1,338)
Balance at end of period $ 1,985 $ 2,599
v3.24.0.1
Deferred Revenue - Additional Information (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Deferred Revenue Disclosure [Abstract]    
Recognition of deferred revenue $ 2.2 $ 0.4
v3.24.0.1
Segment Reporting - Additional Information (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
USD ($)
Segment
Dec. 31, 2022
USD ($)
Dec. 31, 2021
USD ($)
Segment Reporting Information [Line Items]      
Number of reportable segments | Segment 1    
Number of operating segments | Segment 1    
Total revenue $ 307,539 $ 257,800 $ 190,283
United States      
Segment Reporting Information [Line Items]      
Total revenue 86,200 43,000 32,600
China (and Hong Kong)      
Segment Reporting Information [Line Items]      
Total revenue 128,300 109,600 98,800
Malaysia      
Segment Reporting Information [Line Items]      
Total revenue $ 41,000 $ 23,600 $ 23,600
v3.24.0.1
Segment Reporting - Summary of Revenue Categories (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Segment Reporting Information [Line Items]      
Total revenue $ 307,539 $ 257,800 $ 190,283
Endpoint ICs      
Segment Reporting Information [Line Items]      
Total revenue 234,426 191,532 139,250
Systems      
Segment Reporting Information [Line Items]      
Total revenue $ 73,113 $ 66,268 $ 51,033
v3.24.0.1
Segment Reporting - Summary of Long-lived Assets Geography (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Segment Reporting Information [Line Items]    
Property and equipment, net $ 44,891 $ 39,027
United States    
Segment Reporting Information [Line Items]    
Property and equipment, net 14,110 10,551
Malaysia    
Segment Reporting Information [Line Items]    
Property and equipment, net 11,749 12,817
Taiwan    
Segment Reporting Information [Line Items]    
Property and equipment, net 13,396 12,620
Others    
Segment Reporting Information [Line Items]    
Property and equipment, net $ 5,636 $ 3,039
v3.24.0.1
Segment Reporting - Summary of Sales by Geography (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Segment Reporting Information [Line Items]      
Total revenue $ 307,539 $ 257,800 $ 190,283
Americas      
Segment Reporting Information [Line Items]      
Total revenue 96,418 57,129 38,021
Asia Pacific      
Segment Reporting Information [Line Items]      
Total revenue 176,409 168,249 133,152
Europe, Middle East and Africa      
Segment Reporting Information [Line Items]      
Total revenue $ 34,712 $ 32,422 $ 19,110
v3.24.0.1
Net Loss Per Share - Reconciliation of the Numerator and Denominator used in Computing Basic and Diluted Net Loss Per Share (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Numerator:      
Net Income (Loss) $ (43,366) $ (24,301) $ (51,260)
Denominator:      
Weighted-average shares outstanding - basic 26,752 25,539 24,176
Weighted-average shares outstanding - diluted 26,752 25,539 24,176
Net loss per share - basic $ (1.62) $ (0.95) $ (2.12)
Net loss per share - diluted $ (1.62) $ (0.95) $ (2.12)
v3.24.0.1
Net Loss Per Share - Computation of Diluted Net Loss Per Share Effect in Antidilutive (Details) - shares
shares in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Employee Stock Option      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Antidilutive securities excluded from computation of earnings per share 1,466 1,712 2,288
RSUs, MSUs, and PSUs      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Antidilutive securities excluded from computation of earnings per share 1,252 1,494 1,517
Employee Stock Purchase Plan Shares      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Antidilutive securities excluded from computation of earnings per share 51 26 42
2019 Notes      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Antidilutive securities excluded from computation of earnings per share     285
2021 Notes      
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]      
Antidilutive securities excluded from computation of earnings per share 2,589 2,589 2,589
v3.24.0.1
Related-Party Transactions - Additional Information (Details) - USD ($)
 12 Months Ended
Jun. 23, 2023
Oct. 01, 2022
Sep. 21, 2020
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Restricted Stock Units            
Related Party Transaction [Line Items]            
Other than option granted       441,000    
Cathal Phelan | Restricted Stock Units            
Related Party Transaction [Line Items]            
Stock options, vesting percentage   25.00%        
Other than option granted   8,000        
Cathal Phelan | Advisory and Consulting Services            
Related Party Transaction [Line Items]            
Consulting fee expense recognized and paid       $ 0 $ 500,000 $ 500,000
Stock options granted     60,000      
Cathal Phelan | Advisory and Consulting Services | 1/24th of Shares Shall Vest on October 21, 2020            
Related Party Transaction [Line Items]            
Stock options, vesting percentage     4.17%      
Cathal Phelan | Advisory and Consulting Services | 1/24th of Shares Shall Vest Subject on Each Month Thereafter, Subject to His Continued Consulting Services            
Related Party Transaction [Line Items]            
Stock options, vesting percentage     4.17%      
Related Party | Endpoint ICs | Patents            
Related Party Transaction [Line Items]            
Patent acquired $ 300,000          
v3.24.0.1
Retirement Plans - Additional Information (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
401(k) Plan    
Defined Contribution Plan Disclosure [Line Items]    
Employer matching contribution amount $ 1.8 $ 1.4
v3.24.0.1
Restructuring - Additional Information (Details)
 1 Months Ended 12 Months Ended
Feb. 02, 2021
Position
Dec. 31, 2023
USD ($)
Dec. 31, 2021
USD ($)
Restructuring Cost and Reserve [Line Items]      
Restructuring and related activities, description   On February 2, 2021, we restructured our go-to-market organization to strategically align our global sales, product, partner development and marketing teams. As part of the restructuring, we eliminated approximately seven full-time positions within our go-to-market organization, representing roughly 2% of our workforce. We incurred restructuring charges of $1.7 million for employee termination benefits and other associated costs for legal expenses for the year ended December 31, 2021. Restructuring charges were immaterial for the year ended December 31, 2022 and there were no restructuring charges for the year ended December 31, 2023.  
Number of positions eliminated | Position 7    
Number of positions eliminated, percent 2.00%    
Restructuring charges | $   $ 0 $ 1,700,000
Restructuring, Incurred Cost, Statement of Income or Comprehensive Income [Extensible Enumeration]     Restructuring Charges
v3.24.0.1
Subsequent Events - Additional Information (Details) - USD ($)
$ in Millions
 1 Months Ended
Feb. 07, 2024
Feb. 02, 2021
Subsequent Event [Line Items]    
Number of positions eliminated, percent   2.00%
Subsequent Events    
Subsequent Event [Line Items]    
Number of positions eliminated, percent 10.00%  
Subsequent Events | Minimum    
Subsequent Event [Line Items]    
Severance benefits $ 1.7  
Subsequent Events | Maximum    
Subsequent Event [Line Items]    
Severance benefits $ 2.0