v3.26.1
Acquisitions
 6 Months Ended
Jun. 30, 2026
Business Combination [Abstract]  
Acquisitions Acquisitions
LSI Acquisition
On December 15, 2025, the Company entered into a Stock Purchase Agreement with Luminar Technologies, Inc., a Delaware corporation (the “Seller”) and Luminar Semiconductor, Inc. a Delaware corporation (“LSI”), pursuant to which, the Company agreed to acquire all of the issued and outstanding shares of common stock of LSI from the Seller (the “Transaction”). The Transaction was completed on February 2, 2026 (the “LSI Closing Date”). LSI is engaged primarily in the design, development, manufacturing, packaging, and development services of photonic components and sub-systems (including semiconductor lasers and photodetectors), application-specific integrated circuits, and pixel-based sensors. LSI’s revenue is derived from customers located in the United States and international markets.
The purchase price was $110.0 million in cash, subject to a dollar-for-dollar adjustment to the extent that the working capital at closing was greater or less than the target working capital of $8.1 million. The consideration paid by the Company at closing consisted of approximately $97.5 million in cash, along with $11.0 million placed with an escrow agent at signing. The escrow will remain in place for twelve months following the LSI Closing Date to cover certain limited indemnification obligations of the Seller.
The fair value of consideration transferred is below (in thousands):
Initial purchase price$110,000 
Less adjustments per purchase agreement for working capital and indebtedness(1,501)
Preliminary purchase price108,499 
Amount paid prior to closing date(11,000)
Cash consideration on closing date$97,499 
The acquisition is accounted for in accordance with FASB ASC Topic 805, Business Combinations (“ASC 805”). This method requires that assets acquired and liabilities assumed in a business combination be recognized at their respective estimated fair values as of the acquisition date. The Company allocated the purchase price to identifiable assets acquired based on their estimated fair values. The fair value of the consideration transferred and the assets acquired and liabilities assumed was determined by the Company and in doing so management engaged a third-party valuation specialist to assist with the measurement of the fair value of identifiable intangible assets. The estimated fair value of the identifiable assets acquired and liabilities assumed was based on management’s best estimates. The table below represents the preliminary purchase price allocation for LSI based on estimates, assumptions, valuations and other analyses as of the Closing Date, that have not been finalized in order to make a definitive allocation. Accordingly, the adjustments to allocate the purchase price will remain preliminary until management finalizes the fair values of assets acquired and liabilities assumed. The fair value of intangible assets was based upon an independent appraiser utilizing the cost, income or market approach. Operating lease asset and operating lease liability were valued based upon the present value of lease payments over the remaining lease term. The fair value of trade names and developed technology was determined using the relief-from-royalty method. The fair value of all other assets and liabilities approximated the carrying values at acquisition date. The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. The final amounts allocated to assets acquired and liabilities assumed, and therefore, calculation of goodwill, are dependent upon certain valuation and other studies that have not yet been completed and could differ materially from the amounts presented in the condensed consolidated financial statements. The goodwill recorded from this acquisition represents business benefits the Company anticipates from the acquired workforce and expectations for expanded sales opportunities to foster further business growth. The goodwill associated with the acquisition is deductible for tax purposes.
The preliminary purchase price is allocated to the tangible and intangible assets and liabilities of LSI based on their estimated fair values, with any excess purchase consideration allocated to goodwill as follows (in thousands):
Acquisition Date
Fair Values Assigned
Assets acquired:
Cash and cash equivalents$- 
Accounts receivable3,624 
Inventory3,070 
Prepaid expenses and other current assets1,146 
Property and equipment3,246 
Operating lease right-of-use assets3,181 
Intangible assets24,144 
38,411 
Liabilities assumed:
Accounts payable721 
Accrued expenses604 
Deferred revenue and contract liabilities1,267 
Other current liabilities913 
Operating lease liabilities, net of current portion2,268 
5,773 
Total identifiable net assets acquired32,638 
Goodwill75,861 
Preliminary purchase price$108,499 
During the three-months ended June 30, 2026, there was a $10.6 million change to the purchase price allocation related to intangibles assets. The measurement period adjustment did not have a material impact on the condensed consolidated statement of operations.
Acquired intangibles include the following:
Fair Value (in thousands)Useful Life in Years
Developed technology$21,238 7
Tradename2,906 5
Total$24,144 

From the acquisition date through June 30, 2026, LSI contributed revenue of $8.1 million and operating loss of $5.7 million.
NuCrypt Acquisition
The Company completed its acquisition of NuCrypt, LLC (“NuCrypt”), a quantum communications technology company, on March 4, 2026. The acquisition helps establish quantum communications as an important commercialization vertical within QCi’s broader quantum technology strategy. By integrating NuCrypt’s suite of quantum communications systems and products, QCi expects to advance its technology roadmap while extending its portfolio of quantum communications and quantum photonics solutions.
The purchase price was $2.5 million in cash, subject to a working capital adjustment at closing, and 250,000 shares of QCi’s common stock. The equity consideration is valued at the fair value as of the acquisition date and will be issued equally in shares of common stock on the first, second and third anniversaries of the acquisition. The shares are reserved out of the Company’s authorized but unissued shares.
The fair value of consideration transferred is below (in thousands):
Initial cash purchase price$2,500 
Plus adjustments per purchase agreement for working capital(9)
Equity consideration at fair value2,038 
Preliminary Purchase Price4,529 
Less: Cash Retained by Company(58)
Fair value of consideration transferred$4,471 
The acquisition is accounted for in accordance with ASC 805. This method requires that assets acquired and liabilities assumed in a business combination be recognized at their respective estimated fair values as of the acquisition date. The Company allocated the purchase price to identifiable assets acquired based on their estimated fair values. The fair value of the consideration transferred and the assets acquired and liabilities assumed was determined by the Company and in doing so management engaged a third-party valuation specialist to assist with the measurement of the fair value of identifiable intangible assets. The estimated fair value of the identifiable assets acquired and liabilities assumed was based on management’s best estimates. The table below represents the preliminary purchase price allocation for NuCrypt based on estimates, assumptions, valuations and other analyses as of the Closing Date, that have not been finalized in order to make a definitive allocation. Accordingly, the adjustments to allocate the purchase price will remain preliminary until management finalizes the fair values of assets acquired and liabilities assumed. The fair value of intangible assets was based upon an independent appraiser utilizing the cost, income or market approach. Operating lease asset and operating lease liability were valued based upon the present value of lease payments over the remaining lease term. The fair value of the customer relationships was determined using the multi-period excess earnings income approach or cost approach. The fair value of trade names and developed technology was determined using the relief-from-royalty method. The fair value of all other assets and liabilities approximated the carrying values at acquisition date. The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. The final amounts allocated to assets acquired and liabilities assumed, and therefore, calculation of goodwill, are dependent upon certain valuation and other studies that have not yet been completed and could differ materially from the amounts presented in the condensed consolidated financial statements. The goodwill recorded from this acquisition represents business benefits the Company anticipates from the acquired workforce and expectations for expanded sales opportunities to foster further business growth. The goodwill associated with the acquisition is deductible for tax purposes.
The preliminary purchase price is allocated to the tangible and intangible assets and liabilities of NuCrypt based on their estimated fair values, with any excess purchase consideration allocated to goodwill as follows (in thousands):
Acquisition Date
Fair Values Assigned
Assets acquired:
Cash and cash equivalents$58 
Accounts receivable59 
Prepaid expenses and other current assets11 
Operating lease right-of-use assets22 
Property and equipment18 
Intangible assets1,018 
1,186 
Liabilities assumed:
Accounts payable33 
Other current liabilities43 
76 
Total identifiable net assets acquired1,110 
Goodwill3,419 
Preliminary purchase price$4,529 
Acquired intangibles include the following:
Fair Value (in thousands)Useful Life in Years
Developed technology$586 8
Customer Relationships289 16
Tradename143 7
Total$1,018 
From the acquisition date through June 30, 2026, NuCrypt contributed revenue of $0.4 million and operating loss of $0.2 million.
NHanced Acquisition
The Company completed its acquisition of NHanced Semiconductors, Inc. (“NHanced”) on June 22, 2026. The acquisition marks an important step in QCi’s transition from research-driven innovation and prototyping to scalable commercial production. By adding semiconductor and nanophotonics fabrication capabilities, advanced packaging expertise and specialized engineering talent, QCi is strengthening its operational capabilities and manufacturing readiness.
The purchase price was $48.1 million in cash, subject to a working capital adjustment at closing, $20.0 million placed in escrow and $5.0 million in shares of QCi’s common stock. The escrow amounts are to be paid to the sellers, with interest, upon NHanced achieving certain revenue targets as of December 31, 2027 and 2028. The equity consideration consists of 447,000 shares valued using the stock price as of the acquisition date. In addition, the acquisition agreement includes contingent consideration of up to $72.0 million based on the achievement of certain post-acquisition performance targets based on revenue as of December 31, 2027 and revenue and EBITDA as of December 31, 2028. As of June 30, 2026, the Company is continuing to evaluate the fair value of the contingent consideration as part of its preliminary purchase price allocation. Based on information available at this time, no amount has been preliminarily assigned to the contingent consideration liability; however, the valuation remains subject to change upon completion of the Company's valuation analyses and other purchase accounting procedures.
The fair value of consideration transferred is below (in thousands):
Initial cash purchase price$48,100 
Plus contingent consideration paid to escrow20,000 
Plus adjustments per purchase agreement for working capital684 
Total cash payments at close68,784 
Equity consideration at fair value5,000 
Preliminary Purchase Price$73,784 

The acquisition is accounted for in accordance with ASC 805. This method requires that assets acquired and liabilities assumed in a business combination be recognized at their respective estimated fair values as of the acquisition date. The Company has not completed its valuation of acquired identifiable assets, including intangibles, as of the filing date of this Form 10-Q. Accordingly, the preliminary purchase price allocation reflects provisional amounts based on information currently available. Significant adjustments may be recorded upon completion of management's valuation analysis and third-party valuation studies. Such adjustments are expected to impact intangible assets, property and equipment, inventory and goodwill. As the allocation to identifiable intangible assets, which are expected to include developed technology, customer relationships, and tradename is not currently available due to the timing between the acquisition date and the filing of the Form 10-Q, we have classified amounts that would be allocated to such assets as goodwill as of June 30, 2026. The table below represents the preliminary purchase price allocation for NHanced based on management's best estimates as of the Closing Date. Operating lease asset and operating lease liability were valued based upon the present value of lease payments over the remaining lease term. The estimated fair value of all other assets and liabilities approximated the carrying values at acquisition date. The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. The goodwill recorded from this acquisition represents business
benefits the Company anticipates from the acquired workforce and expectations for expanded sales opportunities to foster further business growth. The goodwill associated with the acquisition is deductible for tax purposes.
Acquisition Date
Fair Values Assigned
Assets acquired:
Cash and cash equivalents$- 
Accounts receivable2,592 
Inventory7,720 
Prepaid expenses and other current assets185 
Property and equipment24,746 
Operating lease right-of-use assets12,812 
Other non-current assets320 
Intangible assets (subject to completion of valuation)
48,375 
Liabilities assumed:
Accounts payable1,567 
Accrued expenses2,305 
Deferred revenue and contract liabilities1,492 
Other current liabilities2,231 
Other non-current liabilities1,184 
Operating lease liabilities, net of current portion12,414 
21,193 
Total identifiable net assets acquired27,182 
Goodwill46,602 
Preliminary purchase price$73,784 
From the acquisition date through June 30, 2026, NHanced contributed revenue of $0.1 million and an operating loss of $0.4 million.
Unaudited Proforma Condensed Consolidated Results
The table below presents the unaudited pro forma condensed consolidated results assuming the acquisition of LSI, NuCrypt and NHanced had occurred on January 1, 2025 (in thousands):
Three Months Ended June 30, 2026
QCi as ReportedLSI Pre-AcquisitionNuCrypt Pre-AcquisitionNHanced Pre-AcquisitionTotal
Total revenue$5,551 $— $— $3,525 $9,076 
Net loss$(11,753)$— $— $(3,229)$(14,982)
Three Months Ended June 30, 2025
QCi as ReportedLSI Pre-AcquisitionNuCrypt Pre-AcquisitionNHanced Pre-AcquisitionTotal
Total revenue$61 $5,146 $149 $10,399 $15,755 
Net (loss) income$(36,482)$(3,578)$(167)$2,398 $(37,829)
Six Months Ended June 30, 2026
QCi as ReportedLSI Pre-AcquisitionNuCrypt Pre-AcquisitionNHanced Pre-AcquisitionTotal
Total revenue$9,242 $1,742 $346 $7,549 $18,879 
Net loss$(15,803)$(640)$(158)$(4,277)$(20,878)
Six Months Ended June 30, 2025
QCi as ReportedLSI Pre-AcquisitionNuCrypt Pre-AcquisitionNHanced Pre-AcquisitionTotal
Total revenue$100 $13,619 $340 $16,445 $30,504 
Net (loss) income$(19,500)$(9,603)$(204)$290 $(29,017)
The proforma information above reflects the combination of the Company’s results of operations as disclosed in the accompanying condensed consolidated statements of operations together with the unaudited results of LSI, NuCrypt and NHanced for the same periods.