v3.26.1
Fair Value Measurement
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurement Fair Value Measurement
Assets and liabilities recorded at fair value on a recurring basis on the condensed balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows:
Level 1—Observable inputs such as unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
Level 2—Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy during the periods presented.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following tables set forth the Company's financial instruments on the condensed balance sheets that were measured at fair value on a recurring basis for the period indicated by level within the fair value hierarchy (in thousands):
June 30, 2026
Level 1
Level 2
Level 3
Total
Financial assets:
Money market funds
$71,901 $— $— $71,901 
Total
$71,901 $— $— $71,901 
Financial liabilities:
Warrants
$— $— $74,688 $74,688 
Total
$— $— $74,688 $74,688 

December 31, 2025
Level 1
Level 2
Level 3
Total
Financial assets:
Money market funds
$125,548 $— $— $125,548 
Total
$125,548 $— $— $125,548 
Financial liabilities:
Warrants
$— $— $114,353 $114,353 
Total
$— $— $114,353 $114,353 
Fair Value Measurements of Other Financial Instruments
The following table presents the carrying amounts and estimated fair values of the financial instruments that are not recorded at fair value on the condensed balance sheets (in thousands):
June 30, 2026December 31, 2025
Net Carrying AmountEstimated Fair ValueNet Carrying AmountEstimated Fair Value
2028 Notes
$47,817 $45,152 $47,703 $45,152 
2029 Notes
$144,293 $151,037 $140,980 $153,712 
2031 Notes
$183,699 $267,719 $183,130 $280,269 
The principal amounts of the 1.00% convertible senior notes due 2028 (the "2028 Notes"), 4.25%/8.75% PIK/cash senior secured notes due 2029 (the “2029 Notes”) and 4.00% convertible senior notes due 2031 (the “2031 Notes”, together with the 2028 Notes, and the 2029 Notes, the "Notes") are $48.2 million, $146.9 million, and $190.1 million, respectively. The difference between the principal amounts of such notes and their respective net carrying amounts is the unamortized debt issuance costs and debt premiums.
For the periods presented, the fair value of the 2028 Notes, the 2029 Notes and the 2031 Notes, which differs from their carrying value, is determined based on the quoted bid prices of such notes in an over-the-counter market using the latest trading information of the reporting period.
Fair Value Measurement of Warrants
In connection with the 2024 Note Exchange (defined in Note 6 – Non-convertible Notes, Net), the Company issued warrants (the "Warrants") to the participants in the 2024 Note Exchange to acquire an aggregate of up to 7,894,737 shares (subject to adjustment in accordance with the terms of the Warrants) of the Company’s common stock to the holders of the Exchanged Notes at an exercise price of $1.71, subject to certain cashless exercise provisions and adjustment in accordance with the terms of the Warrants. The Warrants are exercisable from the date of issuance until they expire on March 1, 2029. The Warrants are accounted for as liabilities under ASC 480 since the Warrants may be required to be settled in cash in case of a fundamental change, which could occur outside of the Company’s control. Changes in fair value are recognized within change in fair value of warrant liability on the Company’s condensed statements of operations.
During the six months ended June 30, 2026, warrants with an exercise value of approximately $10.9 million were exercised on a cashless basis and reclassified from warrant liabilities to additional paid-in capital. In connection with these exercises, 729,941 warrants were settled on a net share basis, resulting in the issuance of 655,017 shares of common stock. The difference between the number of warrants exercised and shares issued reflects shares withheld to satisfy the exercise value of the warrants. As of June 30, 2026, 7,164,796 warrants remained outstanding after giving effect to warrant exercises during the period.
The aggregate fair value of the Warrants for the periods presented was determined using a Black-Scholes Model with the following inputs:
June 30, 2026December 31, 2025
Stock price$11.79$15.78
Exercise price$1.71$1.71
Expected life in years
2.673.17
Expected volatility
86.40 %93.51 %
Expected dividends
— %— %
Discount rate
4.15 %3.55 %

The following table presents the activity related to the Warrants for each of the periods presented:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Beginning balance
$56,105 $36,081 $114,353 $78,584 
Settlement of warrant liabilities— — (10,913)— 
Change in fair value18,583 (4,537)(28,752)(47,040)
Ending balance
$74,688 $31,544 $74,688 $31,544