On September 6, 2024, the Company completed the sale of its Physical Security Business to Buyer, and Buyer assumed certain of the Company’s liabilities related to the Physical Security Business (collectively, the “Asset Sale”) pursuant to that certain Stock and Asset Purchase Agreement, dated as of April 2, 2024 (the “Purchase Agreement”), by and between the Company and Buyer. As consideration for the Asset Sale, the Company received gross proceeds of approximately $143.9 million in cash.

In connection with the closing of the Asset Sale, the Company and Buyer entered into a transition services agreement (the “Transition Services Agreement”). The Transition Services Agreement outlined the information technology, people, and facility support the Company provided to Buyer for a period of 12 months to 18 months after the transaction closing date. The agreed upon charges for such services were intended to allow the Company and Buyer, respectively, to recover all costs and expenses of providing such services. On September 6, 2025, the Company and Buyer completed the transition services and agreed to terminate the Transition Services Agreement. Fees earned and incurred under the Transition Services Agreement for the years ended December 31, 2025 and 2024 were immaterial.

As the sale of the Company's Physical Security Business represented a significant strategic shift that has a material effect on the Company's operations and financial results, the Company has separately reported the results of its Physical Security Business as discontinued operations in the consolidated statements of comprehensive income (loss) for the 2024 period presented.

The following presents the financial results of discontinued operations for the year ended December 31, 2024 (in thousands):


	Year Ended December 31,
	2024
Net revenue	$	42,473
Cost of revenue		22,825
Gross profit		19,648
Operating expenses:
Research and development		6,514
Selling and marketing		11,960
General and administrative		3,741
Restructuring and severance		145
Total operating expenses		22,360
Loss from operations		(2,712	)
Non-operating income (expense):
Foreign currency losses, net		(25	)
Loss before income tax provision		(2,737	)
Income tax provision		(41	)
Net loss	$	(2,778	)

The cash flows related to the discontinued operations have not been segregated and are included in the consolidated statements of cash flows. The following presents the significant non-cash items and capital expenditures related to discontinued operations for the year ended December 31, 2024 (in thousands):


	Year Ended December 31,
	2024
Depreciation and amortization	$	892
Capital expenditures		322
Stock-based compensation		5,254