As previously reported, on December 8, 2025, the Company entered into a Put Option Agreement to divest its Video business to Leone Media Inc. for $145 million, subject to working capital and other adjustments. On June 16, 2026, the Company completed the sale of its Video business with proceeds of $137.9 million, subject to final adjustments under the terms of the APA. The following table summarizes the carrying values of the assets and liabilities classified as held-for-sale in our consolidated balance sheets:


(in thousands)	July 3, 2026		December 31, 2025
Assets
Accounts receivable, net	$	—	$	38,895
Inventories		—		23,890
Prepaids and other current assets		—		13,207
Property and equipment, net		—		1,296
Goodwill		—		123,479
Deferred income taxes, net		—		8,742
Other non-current assets		—		14,452
Assets held for sale	$	—	$	223,961

Liabilities
Current portion of other borrowings	$	—	$	5,605
Accounts payable		—		8,004
Deferred revenue		—		26,577
Other current liabilities		—		22,936
Other long-term borrowings		—		8,076
Other non-current liabilities		—		14,473
Liabilities to be disposed of	$	—	$	85,671

Assets and liabilities classified as held for sale are required to be recorded at the lower of carrying value or fair value less costs to sell. As of December 31, 2025, we determined that the fair value of the Video business, including costs to sell, was lower than its carrying value and we recorded goodwill impairment charge of $57.5 million. On June 16, 2026, the effective date of the sale, we recorded an additional loss on disposal of $6.3 million.

The operating results of the discontinued operations only reflect revenues and expenses that are directly attributable to the Video business that will be eliminated from continuing operations. The following table presents key components of "Income (loss) from discontinued operations, net of tax" for all periods presented:


	Three Months Ended				Six Months Ended
(in thousands)	July 3, 2026		June 27, 2025		July 3, 2026		June 27, 2025
Revenue	$	39,493	$	51,109	$	89,564	$	99,366
Cost of revenue		12,643		17,102		28,244		33,265
Total gross profit		26,850		34,007		61,320		66,101
Operating expenses:
Research and development		10,124		11,450		24,341		23,135
Selling, general and administrative		21,952		17,711		44,915		35,029
Restructuring and related charges		—		222		—		222
Total operating expenses		32,076		29,383		69,256		58,386
Income (loss) from discontinued operations		(5,226)		4,624		(7,936)		7,715
Interest expense, net		(163)		(163)		(261)		(326)
Other income, net		—		1,551		—		2,000
Loss on sale of discontinued operations		(6,251)		—		(6,251)		—
Income (loss) from discontinued operations before income taxes		(11,640)		6,012		(14,448)		9,389
Provision for income taxes		7,735		2,284		7,266		2,090
Income (loss) from discontinued operations, net of tax	$	(19,375)	$	3,728	$	(21,714)	$	7,299

The Company will continue to be involved with the Buyer pursuant to a transition services agreement, through which the Company and the Buyer will continue to provide certain services (mainly IT support and facilities) to each other over a period of up to 12 months following the date of sale. Certain services may be extended for up to an additional three months upon mutual agreement. During the second quarter of 2026, transition services agreement income, net was $0.4 million.

In accordance with ASC 205-20, cash flows from discontinued operations are not separately presented on the face of the consolidated statement of cash flows. The following table presents the significant operating and investing cash flow items related to the Video business:


	Six Months Ended
(in thousands)	July 3, 2026		June 27, 2025
Operating activities:
Stock-based compensation	$	8,619	$	5,490
Depreciation		—		520
Investing activities:
Purchase of property and equipment	$	172	$	468