v3.26.1
Stockholders' Deficit
 6 Months Ended
Jun. 30, 2026
Equity [Abstract]  
Stockholders' Deficit
10. Stockholders' Deficit
Reverse Stock Split
On June 3, 2026, the Company filed a Certificate of Amendment to the its charter with the Secretary of State of the State of Delaware, which effected a 1-for-10 reverse stock split of its issued and outstanding common stock at 12:01 AM Eastern Time on June 17, 2026. As a result of the Reverse Stock Split, every ten shares of the Company’s issued and outstanding common stock were automatically combined into one share of common stock, without any change in par value per share, which remained $0.0001 per share.
The Reverse Stock Split did not alter any stockholder’s percentage ownership interest in the Company, except to the extent that the Reverse Stock Split resulted in fractional shares. No fractional shares were issued in connection with the Reverse Stock Split, and stockholders who would otherwise have been entitled to receive a fractional share received a cash payment in lieu thereof.
All outstanding stock options, restricted stock units, and other equity-based awards, as well as the number of shares available for issuance under the Company’s 2024 Omnibus Incentive Plan, as amended, were proportionately adjusted in accordance with their respective terms.
All share and per share amounts presented in the accompanying condensed consolidated financial statements and related notes have been retroactively adjusted to reflect the Reverse Stock Split for all periods presented.
Common Stock
The common stock has a par value of $0.0001 per share. Each share of common stock is entitled to one vote at all meetings of stockholders. The number of authorized shares of common stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of shares of capital stock of the Company representing a majority of the votes represented by all outstanding shares of capital stock of the Company entitled to vote. The holders of common stock are also entitled to receive dividends, when, if and as declared by the board of directors, whenever funds are legally available therefore, subject to the priority rights of any outstanding preferred stock.
Share Repurchase Programs
On August 15, 2025, the Board of Directors authorized a stock repurchase program (the “2025 Share Repurchase Plan”) in the aggregate amount of up to $10 million (inclusive of any taxes payable as a result of such repurchase) that would allow the Company to repurchase shares of its issued and outstanding common stock, par value $0.0001 per share. The authorization does not have a specified expiration date. Accordingly, unless terminated earlier by resolution of the Board, the 2025 Share Repurchase Plan will expire when the Company has repurchased all shares authorized for repurchase thereunder. The Company is not obligated to acquire any particular amount of Common Stock and may modify or suspend the repurchases at any time in the Company’s discretion.
In the three and six months ended June 30, 2026, the Company did not purchase shares as part of the 2025 Stock Repurchase Plan. As of June 30, 2026, $9.9 million was still available for share repurchases under the 2025 Share Repurchase Plan.
Tax Benefit Preservation Plan and Preferred Stock Purchase Rights
Effective June 5, 2024, the Company entered into the 2024 Tax Benefit Preservation Plan with Broadridge Corporate Issuer Solutions, LLC, as Rights Agent (the “2024 Tax Benefit Preservation Plan”). By adopting the 2024 Tax Benefit Preservation Plan, the Company is seeking to protect its ability to use its net operating loss carryforwards (“NOLs”) and other tax attributes to offset potential future income tax liabilities. The Company’s ability to use such NOLs and other tax attributes would be substantially limited if the Company experiences an “ownership change,” as defined in Section 382 of the Internal Revenue Code. The 2024 Tax Benefit Preservation Plan is intended to make it more difficult for the Company to undergo an ownership change by deterring any person from acquiring 4.9% or more of the outstanding shares of stock without the approval of the Board of Directors. The following figures have been adjusted to reflect the Reverse Stock Split.
As part of the 2024 Tax Benefit Preservation Plan, the Board declared a dividend of one preferred stock purchase right (a “2024 Right” and collectively the “2024 Rights”) for each outstanding share of Common Stock payable as of June 15, 2024. In connection
with the 2024 Tax Benefit Preservation Plan, 2,703,061 2024 Rights were issued. The description and terms of the 2024 Rights are set forth in the 2024 Tax Benefit Preservation Plan. The 2024 Rights trade with, and are inseparable from, the Common Stock, and the record holders of shares of Common Stock are the record holders of the 2024 Rights. The 2024 Rights are not exercisable until the Distribution Date, as defined in the 2024 Tax Benefit Preservation Plan.
After the Distribution Date, each 2024 Right will be exercisable to purchase from the Company one one-thousandth of a share of Series B Junior Participating Preferred Stock, par value $0.0001 per share, of the Company (the “Series B Preferred”), at a purchase price of $152.50 per one one-thousandth of a share of Series B Preferred, subject to adjustment as provided in the 2024 Tax Benefit Preservation Plan. Until a 2024 Right is exercised or exchanged, the holder thereof, as such, will have no rights as a stockholder of the Company by virtue of holding such Right, including, without limitation, the right to vote and to receive dividends. The Board may adjust the Purchase Price, the number of shares of Series B Preferred issuable and the number of outstanding 2024 Rights to prevent dilution that may occur from a stock dividend, a stock split, a reclassification of the Series B Preferred or Common Stock or certain other specified transactions. No adjustments to the Purchase Price of less than 1% are required to be made.
Each one one-hundredth of a share of Series B Preferred, if issued:
•Will not be redeemable.
•Will entitle holders to quarterly dividend payments of $0.01 per one one-hundredth of a share of Series B Preferred, or an amount equal to the dividend paid on one share of Common Stock, whichever is greater.
•Will entitle holders upon liquidation either to receive $0.01 per one one-hundredth of a share of Series B Preferred, or an amount equal to the payment made on one share of Common Stock, whichever is greater.
•Will have the same voting power as one share of Common Stock.
•If shares of Common Stock are exchanged as a result of a merger, consolidation, or a similar transaction, will entitle holders to a per share payment equal to the payment made on one share of Common Stock.
Accumulated Other Comprehensive Income (Loss)
Comprehensive income consists of two elements, net loss and other comprehensive income (loss). Other comprehensive income (loss) items are recorded in the stockholders’ deficit section of the condensed consolidated balance sheets and are excluded from net loss. Other comprehensive income consists primarily of unrealized foreign currency translation adjustments for subsidiaries with functional currencies other than the U.S. dollar, unrealized translation gains (losses) on intercompany loans with foreign subsidiaries when repayment of those loans is not anticipated in the foreseeable future, and gains (losses) on interest rate swaps, net of amounts reclassified into interest expense, net.
The following table shows the components of accumulated other comprehensive loss, net of income taxes, (“AOCI”) in the stockholders’ deficit section of the condensed consolidated balance sheets at the dates indicated (in thousands):
June 30, 2026December 31, 2025
Unrealized foreign currency translation adjustment, net of realized amounts reclassified into loss from divestitures of businesses$(16,535)$(15,223)
Unrealized translation losses on intercompany loans with foreign subsidiaries, net of taxes(2,521)(2,605)
Unrealized gains on interest rate swaps, net of amounts reclassified into interest expense, net442 2,690 
Total accumulated other comprehensive loss$(18,614)$(15,138)
The unrealized translation losses on intercompany loans considered long-term in nature with foreign subsidiaries as of June 30, 2026 and December 31, 2025 are net of income tax of $1.4 million and $1.5 million, respectively.
The functional currency of foreign subsidiaries are the local currencies. Results of operations for foreign subsidiaries are translated into United States dollars (“USD”) using the average exchange rates on a monthly basis during the year. The assets and liabilities of those subsidiaries are translated into USD using the exchange rates in effect at the balance sheet date. The related translation adjustments are recorded in a separate component of stockholders' deficit in AOCI.
The income tax expense/benefit allocated to each component of other comprehensive income for all periods and components is not material. The Company reclassifies taxes from AOCI to earnings as the items to which the tax effects relate are similarly reclassified.
Stock-Based Compensation
The Company’s stock-based compensation generally includes awards of restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) under the Company’s 2024 Omnibus Incentive Plan. Key employees, officers and directors of the Company and its consultants or advisors are eligible to receive awards.
In connection with the hiring of the Company’s President and Chief Executive Officer on May 1, 2026, the Board of Directors granted 50,000 restricted stock units, which will vest in equal installments over three years, subject to continued service, and a grant of PSUs which will vest based on the achievement of certain market-based performance goals, with 13,333 PSUs eligible to vest at target performance and up to 50,000 PSUs eligible to vest at maximum performance. These grants are considered inducement grants pursuant to Nasdaq Listing Rule 5635(c)(4) whereby the underlying shares were authorized outside of the 2024 Omnibus Incentive Plan in connection with the commencement of the new President and Chief Executive Officer’s employment.
The following table summarizes all PSU and RSU activity during the six months ended June 30, 2026:
Number of UnitsWeighted-Average Grant Date Fair Value
Unvested restricted units outstanding as of December 31, 2025194,978 $48.84 
Granted181,833 8.98 
Vested(68,236)34.16 
Forfeited(56,632)72.01 
Unvested restricted units outstanding as of June 30, 2026251,943 $18.84 
The PSU and RSU activity table above includes 13,333 PSUs granted in 2026 based on a 100% target payout that are outstanding at June 30, 2026. During the three months ended June 30, 2026, the Company cancelled 25,000 PSUs based on 100% target payout that were previously granted to an executive officer in connection with the individual’s transition from Chief Executive Officer to a member of the Company’s Board of Directors.
Compensation cost related to awards is based on the fair market value at the time of the grant. The fair value of the RSUs is determined based on the grant date fair value of the award. Compensation expense for RSUs is recognized over the required service period of the grant. The PSUs vest upon the achievement of specified market performance thresholds. The PSUs have a vesting condition that is tied to the Company’s total shareholder return based on the Company’s stock performance up to a maximum of 375%, depending on the specified performance condition and the level of achievement obtained. The fair value of PSUs is determined using the Monte Carlo simulation model. Compensation expense for PSUs is recognized over the requisite service period and is not subject to adjustment regardless of whether the PSUs meet the performance metric.
The significant assumptions used in the Monte Carlo simulation model for the PSUs granted during the six months ended June 30, 2026 were as follows:
Expected volatility90.8%
Risk-free interest rate4.0%
Remaining performance period (in years)2.91
Dividend yield—

The Company recognizes stock-based compensation expense from all awards in the following expense categories included in the condensed consolidated statements of income (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Cost of revenue$72 $143 $158 $264 
Research and development57 318 140 608 
Sales and marketing13 52 43 304 
General and administrative688 2,561 1,450 4,573 
Total$830 $3,074 $1,791 $5,749