v3.25.4
Acquisitions
 12 Months Ended
Dec. 31, 2025
Business Combination [Abstract]  
Acquisitions

5. Acquisitions

 

On November 14, 2025, the Company acquired 100 percent of the equity interests of GuideTech, LLC (“GuideTech”), Warnke Precision Machining, LLC (“Warnke Precision Machining”) and MKR Fabrication, LLC (“MKR Fabricators”). These transactions (collectively, the “2025 Acquisitions”) were undertaken pursuant to separate purchase agreements entered into on November 14, 2025.

 

GuideTech is an engineering and aerospace avionics products and services provider. MKR Fabricators and Warnke Precision Machining are U.S.-based precision manufacturing and fabrication businesses supporting defense and industrial customers. Through the 2025 Acquisitions, the Company acquired engineering design services, advanced avionics products and manufacturing and machining capabilities to complement its AI/ML Foundational Technology and related products and offer vertically integrated solutions for defense and commercial markets.

 

The aggregate consideration transferred for the 2025 Acquisitions was $22.6 million, consisting of $5.4 million of cash, $15.9 million comprised of 2,672,013 shares of common stock, and contingent consideration valued at $1.4 million. The contingent consideration arrangement provides for up to $25 million in earnout payments payable in cash or stock if certain revenue targets are achieved over a five-year period.

 

The 2025 Acquisitions have been accounted for as business combinations and the total purchase consideration was allocated to the net tangible and intangible assets and liabilities based on their fair values on the acquisition date and the excess was recorded as goodwill. The values assigned to the assets acquired and liabilities assumed are based on preliminary estimates of fair value available as of the issuance date of these consolidated financial statements and may be adjusted during the measurement period of up to 12 months from the date of acquisition as further information becomes available. Any changes in the fair values of the assets acquired and liabilities assumed during the measurement period may result in adjustments to goodwill or identified intangible assets. As of December 31, 2025, the primary areas that remain preliminary relate to the valuation of certain intangible items and various tax implications resulting from the acquisition.

The following table presents the preliminary purchase consideration allocation recorded in the Company’s consolidated balance sheet as of the acquisition date:

 

(in thousands)

 

Amount

 

Cash and cash equivalents

 

$

69

 

Accounts receivable

 

 

2,017

 

Unbilled receivables

 

 

316

 

Inventories

 

 

326

 

Prepaid expenses and other current assets

 

 

246

 

Property and equipment

 

 

4,793

 

Intangible assets

 

 

10,548

 

Goodwill

 

 

14,731

 

Operating lease assets

 

 

831

 

Accounts payable

 

 

(1,331

)

Accrued liabilities

 

 

(1,455

)

Current operating lease liabilities

 

 

(59

)

Operating lease liabilities

 

 

(773

)

Other non-current liabilities (1)

 

 

(5,093

)

Deferred tax liabilities

 

 

(2,541

)

Total acquisition consideration

 

$

22,625

 

 

(1)
Other non-current liabilities includes $3.7 million of debt obligations which were repaid prior to December 31, 2025.

 

The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition:

 

 

 

Amounts

 

 

Weighted Average Useful Life

 

 

 

(in thousands)

 

 

(in years)

 

Customer relationships

 

$

5,148

 

 

 

8.8

 

Developed technology

 

 

2,600

 

 

 

7.0

 

Tradename

 

 

1,500

 

 

 

10.0

 

Non-compete

 

 

1,300

 

 

 

5.0

 

Total intangible assets

 

$

10,548

 

 

 

8.1

 

Goodwill represents the future economic benefits arising from other assets that could not be individually identified and separately recognized, such as the acquired assembled workforce and synergies expected to be achieved from the integration of the 2025 Acquisitions. Goodwill is not deductible for tax purposes.

 

The results of operations of the 2025 Acquisitions from the date of acquisition have been included in the Company’s consolidated financial statements. Pro forma revenue and results of operations have not been presented because the historical results of the 2025 Acquisitions are not material to the Company’s consolidated financial statements in any period presented.