v3.26.1
Business Combination and Related Transactions
 3 Months Ended
Mar. 31, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Business Combination and Related Transactions Business Combination and Related Transactions
On the Closing Date, the Company acquired 100% of the outstanding share capital of Stereolabs, a privately-held developer, manufacturer and seller of vision systems headquartered in France. The acquisition expanded the Company's product portfolio, and is expected to further strengthen its software capabilities and accelerated customer development.
Shareholders of Stereolabs received cash consideration of $32.4 million and 1,847,677 newly issued shares of the Company’s common stock, of which 660,005 shares are subject to a staggered lock-up arrangement lasting through a four-year period, whereby twenty-five (25%) percent will be released upon each anniversary of the completion date contingent upon employees remaining employed by the Company. See Note 9.
The consideration paid was comprised of cash and common stock, as follows (in thousands):
Consideration:
  Cash consideration$32,392 
  Fair value of common stock issued, less shares subject to continued employment requirements(1)
22,780 
$55,172 
(1)Calculated based upon 1,187,672 shares at the stock price of $19.18 per share on the Closing Date.
The Company accounted for the acquisition of Stereolabs as a business combination under ASC 805. This accounting treatment requires that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. In accordance with ASC 805, the total purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their respective estimated fair values using management’s best estimates and assumptions to assign fair value as of the acquisition date. The allocation of the purchase price to the assets acquired and liabilities assumed is subject to further adjustment within the measurement period which extends up to one year from the acquisition date.
The Company incurred $5.0 million in acquisition costs for Stereolabs, of which $3.9 million was incurred in the year ended December 31, 2025, and $1.2 million was incurred in three months ended March 31, 2026. These costs were expensed as incurred. Acquisition-related costs are presented within general and administrative expenses in the Company’s condensed consolidated statement of operations. In addition, the sellers incurred transaction costs of $3.0 million which were paid by the Company on the Closing Date.
The following table provides the assets acquired and liabilities assumed as of the date of acquisition (in thousands):
Estimated Fair Value
Purchase consideration$55,172 
Amounts of identifiable assets and liabilities assumed
Cash and cash equivalents$4,899 
Accounts receivable, net1,594 
Inventory2,159 
Prepaid expenses and other current assets (1)
4,065 
Property and equipment, net701 
Operating lease, right-of-use assets1,233 
Intangible assets, net23,400 
Other non-current assets 66 
Accounts payable(1,692)
Accrued and other current liabilities(10,792)
Contract liabilities, current(2,279)
Operating lease liability, current portion(197)
Operating lease liability, non-current portion(1,003)
Deferred tax liability(5,507)
Total identifiable net assets$16,647 
Goodwill38,525 
$55,172 
(1) Prepaid expenses and other current assets includes a $1.9 million indemnification asset, with the underlying indemnified liability of $6.3 million recorded within accrued and other current liabilities.
Identified intangible assets acquired and their estimated useful lives as of February 4, 2026, were (in thousands, except years):
Estimated Useful Life
(in years)
Estimated Fair Value
Trade name6$1,500 
Developed technology414,000 
Customer relationships87,900 
Intangible assets, net$23,400 
Developed technology relates to Stereolabs’ vision-based perception and Artificial Intelligence (“AI”) platform that provides real-time depth sensing, 3D mapping, and object detection in complex real-world environments. The Company valued the developed technology using the relief-from-royalty method under the income approach, which involved assumptions related to the economic life, obsolescence curve, and discount rate. The economic life was determined based on the development cycle, benchmarking analysis, and the projected cash flows over the forecasted period.
The estimated fair value of the trade name was determined using the relief-from-royalty method under the income approach, which involved assumptions related to the economic life and discount rate. The Stereolabs trade name is expected to be in use for the foreseeable future and the economic life was determined based on the branding strategy, benchmarking analysis, and the projected cash flows over the forecasted period.
The Company valued the customer relationship intangible asset using the multi-period excess earnings method under the income approach, which involved assumptions related to the economic life and discount rate. The economic life was determined based on expected attrition and existing customer revenue growth, as well the period over which the majority of discounted cash flows would be realized.
The excess of the purchase consideration and the fair value of identifiable assets acquired and liabilities assumed at the acquisition date over the fair value of net tangible and identified intangible assets acquired was recorded as goodwill, which is deductible for tax purposes. Goodwill is primarily attributable to the assembled workforce and the anticipated operational synergies expected from the Stereolabs acquisition.
Approximately $1.9 million of the cash consideration is held in an escrow account to cover estimated claims arising from pre-closing tax accruals related to certain historical foreign sales transactions and other taxes (“the Specific Tax Loss”). Any
remaining portion of the escrow amount that is not required to cover the Specific Tax Loss amounts will be paid to the former shareholders of Stereolabs at December 31, 2027 (the escrow release date). The indemnification of the Specific Tax Loss is capped at $1.9 million, the amount of the escrow fund balance. At the acquisition date, the associated Specific Tax Loss was recorded at the estimated fair value of $6.3 million within accrued and other current liabilities and the Company recorded an indemnification asset up to the amount of the escrow fund balance of $1.9 million.
The unaudited supplemental pro forma information below presents the combined historical results of operations of the Company and Stereolabs as if Stereolabs had been acquired as of January 1, 2025 (in thousands):

Three Months Ended March 31,
20262025
Revenue$50,216 $34,371 
Net loss$(24,245)$(31,848)
The unaudited supplemental pro forma information above includes the following adjustments to net loss in the appropriate pro forma periods (in thousands):

Three Months Ended March 31,
20262025
An increase in amortization expense related to the fair value of acquired identifiable intangible assets, net of the amortization expense already reflected in actual historical results.$(484)$(1,184)
A decrease (increase) in expenses related to the transaction expenses. This amount includes $3.0 million in transaction expenses incurred by the sellers.
$4,137 $(8,022)
An increase in additional stock-based compensation expense related to shares issued to key Stereolabs employees in the acquisition that are considered compensatory in the post business combination periods due to the additional service requirement, net of the stock compensation expense already reflected in actual historical results.$(303)$(780)
A decrease (increase) in additional stock-based compensation expense related to the impact of the acceleration of Stereolabs warrants that vested at the close of the Stereolabs acquisition.
$207 $(207)
The unaudited supplemental pro forma information has been presented for illustrative purposes only and is not necessarily indicative of results of operations that would have been achieved had the Stereolabs taken place on the date indicated, or of the Company’s future consolidated results of operations. The supplemental pro forma information presented above has been derived from the Company’s historical consolidated financial statements and from historical consolidated financial statements and the historical accounting records of Stereolabs.