Note 5 – Inventory

The Company maintained a provision for excess and obsolete inventory of $6.5 million and $2.8 million as of December 31, 2025 and 2024, respectively. The charge to excess and obsolete inventories is recorded within cost of revenue in the consolidated statements of operations and comprehensive loss.

In 2023, the Group’s warehouse located in the south of Israel suffered physical damage due to a direct missile hit related to the Iron Swords War. As a result, damaged inventory in the amount of $5.0 million was written off. The damage was covered by government authorities and the Company’s insurance policy, part of which was received in 2023, and the remainder in 2024. The net excess over the cost of the inventory damaged, was recognized as other income, $0.4 million in 2024 and $3.8 million in 2023.