Business Combinations (Tables)

12 Months Ended

Dec. 31, 2022

Business Combination and Asset Acquisition [Abstract]

Schedule of Business Acquisition Consideration Transferred

The following table summarizes the Closing Date fair value of the consideration transferred (in thousands):


Fair value of common stock issued (1)	$	174,133
Fair value of replacement stock options(2)	80,693
Consideration for settlement of pre-existing liabilities due to Sixense(3)	(3,810)
Total purchase price	$	251,016

(1) The fair value of the 661,877 shares of common stock issued as part of consideration transferred was determined based on the acquisition date closing market price of the Company’s common stock of $263.09.

(2) Per ASC 805, the replacement of stock options or other share-based payment awards in conjunction with a business combination represents a modification of share-based payment awards that must be accounted for in accordance with ASC 718. As a result of the Company’s obligation to issue replacement awards, a portion of the fair-value-based measure of replacement awards is included in measuring the purchase consideration transferred in the business combination. To determine the portion of the replacement awards that is part of the purchase consideration, the Company measured the fair value of both the replacement awards and the historical awards as of the Closing Date, in accordance with ASC 718. The fair value of the replacement awards, whether vested or unvested, was included in the purchase consideration to the extent that pre-acquisition services had been

rendered. The fair value of replacement stock options assumed for which pre-acquisition services were rendered of $80.7 million was allocated to the purchase consideration and $25.8 million was recognized immediately in the post-combination financial statements as pre-acquisition services were not rendered but the vesting of all stock options was accelerated in connection with the Merger. Refer to Note “11. Stockholders’ Equity” for more information.

(3) In the connection with the Merger, the Company effectively settled pre-existing liabilities due to or on behalf of Sixense.

Schedule of Purchase Price Allocation

The following table presents the allocation of the purchase price, reflecting immaterial measurement period adjustments recorded during the three months ended September 30, 2022 (in thousands):


	Acquisition-Date Fair Value		Estimated Useful Life of Finite-Lived Intangible Assets
Tangible assets acquired and (liabilities) assumed:
Cash and cash equivalents	$	2,919
Prepaid expenses and other current and non-current assets	1,971
Deferred tax assets	20,678
Deferred tax liabilities	(19,398)
Accrued liabilities and other current liabilities	(1,341)
Intangible assets acquired:
Developed technology	62,466		8.75 years
In-process research and development	20,823
Net assets acquired	88,118
Fair value of subsidiary stock indirectly acquired through the Merger	4,161
Total net assets acquired	92,279
Goodwill	158,737
Total purchase price	$	251,016

Pro Forma Information

The unaudited pro forma information is presented below (unaudited, in thousands):


	Year Ended December 31, 2021		Year Ended December 31, 2020
	(unaudited, in thousands)
Pro forma revenues	$	747,840	$	560,779
Proforma net income (loss) attributable to Penumbra, Inc.	$	17,552	$	(30,188)
Proforma net loss attributable to non-controlling interest	$	—	$	—