Investments – Equity Securities |
6 Months Ended |
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Jun. 30, 2026 | |
| Investments, All Other Investments [Abstract] | |
| Investments – Equity Securities | 9. Investments – Equity Securities
In August 2025, the Company purchased shares of Defeye Inc.’s (“Defeye”) Series Seed-2 Preferred Stock in exchange for $2,890 of product purchase credits pursuant to a supply and distribution agreement. The fair value of the consideration the product purchase credits was recorded as deferred revenue and the Company is obligated to deliver product to Defeye when ordered.
In
October 2025, the Company entered into a license agreement (the “Defeye License Agreement”) with Defeye under which the Company
granted Defeye an exclusive license to certain intellectual property. In consideration for the license, the Company received
additional shares of Defeye Series Seed Preferred Stock. As a result of the additional equity interests obtained under the Defeye License
Agreement, the Company’s cumulative ownership and associated rights provide the Company with the ability to exercise significant
influence over Defeye’s operating and financial policies. In the fourth quarter of 2025, the Company determined that the fair value
of the investment was fully impaired due to uncertain market prospects and the preferred stock value was expensed.
On June 3, 2026, the Company entered into a binding Letter Agreement (the “Defeye Letter Agreement”) with Defeye to resolve outstanding commercial disputes. Under the terms of the Defeye Letter Agreement, product credits were permitted to be applied to product invoiced through May 6, 2026, after which any remaining unused credits were permanently waived and extinguished. As part of the settlement, the Company granted Defeye a defined discount of up to $0.3 million.
The Defeye Letter Agreement also established parameters for an approved secondary back-up manufacturer in the event of supply shortfalls, under which Defeye must pay the Company a variable fee based on the greater of a defined percentage of the contractual price or a defined percentage of the cost savings for units sourced from the secondary manufacturer.
The Company also returned shares of Defeye Series Seed-2 Preferred Stock pursuant to the Defeye Letter Agreement, reducing its voting interest below 20%. Consequently, the Company determined it lost significant influence over DefEYE and discontinued equity method accounting as of June 3, 2026.
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