UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________

FORM 10-Q

___________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~June 30, ~~2022.~~2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-39470.

___________________________

VIEW, INC.

(Exact name of registrant as specified in its charter)

___________________________


Delaware						84-3235065
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

195 South Milpitas Blvd Milpitas, California						95035
(Address of principal executive offices)						(Zip Code)

(408) 263-9200

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

___________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange
on which registered

Class A common stock, par value, $0.0001 per share

VIEW

The Nasdaq Global Market

Redeemable warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of ~~$11.50~~$690.00

VIEWW

The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒¨

Accelerated filer

Non-accelerated filer

¨☒

Smaller reporting company

¨☒

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~November 3, 2022, 221,505,840~~August 7, 2023, 4,041,687 shares of Class A common stock, par value $0.0001 of the registrant were issued and outstanding.

Table of Contents

View, Inc.

Quarterly Report on Form 10-Q

Table of Contents


		Page No.
Note Regarding Forward Looking Statements		4

PART I. FINANCIAL INFORMATION		5

Item 1.	Financial Statements (Unaudited)	5
	Condensed Consolidated Balance Sheets as of ~~September~~June 30 , ~~30, 2022~~2023 and December 31, ~~2021~~2022	5
	Condensed Consolidated Statements of Comprehensive Loss for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2022~~2023 and ~~2021~~2022	6
	Condensed Consolidated Statements of ~~Redeemable Convertible Preferred Stock and~~ Stockholders’ Equity ~~(Deficit)~~ for the Three and ~~Nine~~Six Months Ended ~~September~~June 30 ~~30,~~, 2023 and 2022 ~~and 2021~~	7
	Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Six Months Ended ~~September~~June 30 ~~30,~~, 2023 and 2022 ~~and 2021~~	98
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3530
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	4843
Item 4.	Controls and Procedures	4843

PART II. OTHER INFORMATION		5245

Item 1.	Legal Proceedings	5245
Item 1A.	Risk Factors	5245
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	5345
Item 3.	Defaults Upon Senior Securities	5346
Item 4.	Mine Safety Disclosures	5346
Item 5.	Other Information	5346
Item 6.	Exhibits	5346

Signatures		5648

Table of Contents

Note Regarding Forward Looking Statements

Certain statements included in this Quarterly Report on Form 10-Q that are not historical facts are forward-looking statements within the meaning of the federal securities laws, including safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are sometimes accompanied by words such as “believe,” “continue,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “predict,” “plan,” “may,” “should,” “will,” “would,” “potential,” “seem,” “seek,” “outlook” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. These statements are based on various assumptions, whether or not identified in this Quarterly Report on Form 10-Q. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by an investor, as a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of the Company. Many factors could cause actual future events to differ from the forward-looking statements in this Quarterly Report on Form 10-Q. These risks and uncertainties may be amplified by the COVID-19 pandemic and current economic uncertainty, including inflation and rising interest rates. You should carefully consider the factors and the other risks and uncertainties described in Part II, Item 1A of this Quarterly Report on Form 10-Q and in the Company's ~~2021~~2022 Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on ~~June 15, 2022.~~March 31, 2023. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. The Company does not give any assurance that it will achieve its expectations.

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

View, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands, except share ~~and per share~~ data)


		September 30, 2022		December 31, 2021			June 30, 2023		December 31, 2022
Assets	Assets					Assets
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	51,272	$	281,081	Cash and cash equivalents	$	30,144	$	95,858
Short-term investments						Short-term investments	49,824		102,284
Accounts receivable, net of allowances	Accounts receivable, net of allowances	23,934		30,605		Accounts receivable, net of allowances	36,540		42,407
Inventories	Inventories	17,852		10,267		Inventories	17,832		17,373
Prepaid expenses and other current assets	Prepaid expenses and other current assets	34,529		21,579		Prepaid expenses and other current assets	37,892		38,297
Total current assets	Total current assets	127,587		343,532		Total current assets	172,232		296,219
Property and equipment, net	Property and equipment, net	262,549		268,401		Property and equipment, net	257,307		262,360
Restricted cash	Restricted cash	16,444		16,462		Restricted cash	13,147		16,448
Right-of-use assets	Right-of-use assets	19,167		21,178		Right-of-use assets	17,070		18,485

Other assets	Other assets	27,186		29,493		Other assets	26,170		25,514
Total assets	Total assets	$	452,933	$	679,066	Total assets	$	485,926	$	619,026
Liabilities and Stockholders’ Equity	Liabilities and Stockholders’ Equity					Liabilities and Stockholders’ Equity
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	15,232	$	24,186	Accounts payable	$	17,345	$	21,099
Accrued expenses and other current liabilities	Accrued expenses and other current liabilities	54,782		59,456		Accrued expenses and other current liabilities	52,250		72,410
Accrued compensation	Accrued compensation	11,430		9,508		Accrued compensation	7,534		9,799
Deferred revenue	Deferred revenue	7,677		11,460		Deferred revenue	6,474		9,199

Total current liabilities	Total current liabilities	89,121		104,610		Total current liabilities	83,603		112,507
Debt, non-current	Debt, non-current	13,225		13,960		Debt, non-current	94,728		109,754
Debt, non-current - related party						Debt, non-current - related party	113,613		109,083
Sponsor earn-out liability	Sponsor earn-out liability	1,260		7,624		Sponsor earn-out liability	—		506
Lease liabilities	Lease liabilities	20,485		22,997		Lease liabilities	17,757		19,589
Other liabilities	Other liabilities	41,068		50,537		Other liabilities	41,356		47,095
Total liabilities	Total liabilities	165,159		199,728		Total liabilities	351,057		398,534
Commitments and contingencies (Note 7)
Commitments and contingencies (Note 6)						Commitments and contingencies (Note 6)

Stockholders’ equity:	Stockholders’ equity:					Stockholders’ equity:

Common stock, $0.0001 par value; 600,000,000 shares authorized as of September 30, 2022 and December 31, 2021; 221,390,799 and 219,195,971 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively		22		22
Common stock, $0.0001 par value; 600,000,000 shares authorized as of June 30, 2023 and December 31, 2022; 4,032,626 and 3,695,598 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively						Common stock, $0.0001 par value; 600,000,000 shares authorized as of June 30, 2023 and December 31, 2022; 4,032,626 and 3,695,598 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively	—		—
Additional paid-in capital	Additional paid-in capital	2,792,406		2,736,647		Additional paid-in capital	2,852,938		2,814,912

Accumulated deficit	Accumulated deficit	(2,504,654)		(2,257,331)		Accumulated deficit	(2,718,069)		(2,594,420)
Total stockholders’ equity	Total stockholders’ equity	287,774		479,338		Total stockholders’ equity	134,869		220,492
Total liabilities and stockholders’ equity	Total liabilities and stockholders’ equity	$	452,933	$	679,066	Total liabilities and stockholders’ equity	$	485,926	$	619,026

Share and per share data have been adjusted for all periods presented to reflect the 60-for-1 reverse stock split effective July 26, 2023.

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

View, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(unaudited)

(in thousands, except share and per share data)


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended June 30,				Six Months Ended June 30,
		2022		2021		2022		2021			2023		2022		2023		2022
Revenue	Revenue	$	23,762	$	18,884	$	57,090	$	45,579	Revenue	$	24,071	$	14,546	$	38,958	$	29,788
Costs and expenses:
Revenue - related party										Revenue - related party	3,963		1,770		7,424		3,540
Total revenue										Total revenue	28,034		16,316		46,382		33,328
Cost of revenue	Cost of revenue	49,126		51,828		129,219		137,617		Cost of revenue	36,505		39,496		74,418		79,860
Cost of revenue - related party										Cost of revenue - related party	5,305		35		7,605		233
Total cost of revenue										Total cost of revenue	41,810		39,531		82,023		80,093
Gross loss										Gross loss	(13,776)		(23,215)		(35,641)		(46,765)
Operating expenses:										Operating expenses:
Research and development	Research and development	15,554		36,314		56,157		73,924		Research and development	9,714		20,908		22,655		40,603
Selling, general, and administrative	Selling, general, and administrative	41,174		38,210		124,888		94,543		Selling, general, and administrative	23,511		40,755		48,911		83,714
Total costs and expenses		105,854		126,352		310,264		306,084
Impairment of note receivable (Note 4)										Impairment of note receivable (Note 4)	4,000		—		4,000		—
Restructuring costs (Note 11)										Restructuring costs (Note 11)	1,258		—		5,507		—
Total operating expenses										Total operating expenses	38,483		61,663		81,073		124,317
Loss from operations	Loss from operations	(82,092)		(107,468)		(253,174)		(260,505)		Loss from operations	(52,259)		(84,878)		(116,714)		(171,082)
Interest and other expense (income), net
Interest and other expense (income), net:										Interest and other expense (income), net:

Interest expense, net	Interest expense, net	58		287		324		5,906		Interest expense, net	3,970		69		7,131		266

Other expense (income), net	Other expense (income), net	118		(100)		259		6,320		Other expense (income), net	119		(187)		281		141

Gain on fair value change, net	Gain on fair value change, net	(226)		(13,078)		(6,511)		(18,426)		Gain on fair value change, net	(6)		(1,904)		(513)		(6,285)
Loss on extinguishment of debt		—		—		—		10,018
Interest and other (income) expense, net		(50)		(12,891)		(5,928)		3,818
Loss before provision (benefit) for income taxes		(82,042)		(94,577)		(247,246)		(264,323)
Provision (benefit) for income taxes		23		(425)		77		(416)

Interest and other expense (income), net										Interest and other expense (income), net	4,083		(2,022)		6,899		(5,878)
Loss before provision for income taxes										Loss before provision for income taxes	(56,342)		(82,856)		(123,613)		(165,204)
Provision for income taxes										Provision for income taxes	18		30		36		54
Net and comprehensive loss	Net and comprehensive loss	$	(82,065)	$	(94,152)	$	(247,323)	$	(263,907)	Net and comprehensive loss	$	(56,360)	$	(82,886)	$	(123,649)	$	(165,258)

Net loss per share, basic and diluted	Net loss per share, basic and diluted	$	(0.38)	$	(0.44)	$	(1.15)	$	(1.64)	Net loss per share, basic and diluted	$	(14.11)	$	(23.21)	$	(31.17)	$	(46.28)
Weighted-average shares used in calculation of net loss per share, basic and diluted	Weighted-average shares used in calculation of net loss per share, basic and diluted	214,775,043		212,154,820		214,422,143		160,497,517		Weighted-average shares used in calculation of net loss per share, basic and diluted	3,994,813		3,570,886		3,966,316		3,570,711

Share and per share data have been adjusted for all periods presented to reflect the 60-for-1 reverse stock split effective July 26, 2023.

The accompanying notes are an integral part of these condensed consolidated financial statements.

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View, Inc.

Condensed Consolidated Statements of ~~Redeemable Convertible Preferred Stock and~~ Stockholders’ Equity ~~(Deficit)~~

(unaudited)

(in thousands)

Common Stock Additional
Paid-In
Capital Accumulated
Deficit Total
Stockholders’
Equity
Shares Amount
Balances as of December 31, 2021 219,196 $ 22 $ 2,736,647 $ (2,257,331) $ 479,338
Vesting of restricted stock units 26 — — — —
Stock-based compensation — — 17,468 — 17,468
Net loss — — — (82,372) (82,372)
Balances as of March 31, 2022 219,222 $ 22 $ 2,754,115 $ (2,339,703) $ 414,434
Vesting of restricted stock units 6 — — — —
Stock-based compensation — — 18,141 — 18,141
Net loss — — — (82,886) (82,886)
Balances as of June 30, 2022 219,228 $ 22 $ 2,772,256 $ (2,422,589) $ 349,689
Vesting of restricted stock units 4,050 — — — —
Stock-based compensation — — 23,226 — 23,226
Shares withheld related to net share settlement of equity awards (1,887) — (3,076) — (3,076)
Net loss — — — (82,065) (82,065)
Balances as of September 30, 2022 221,391 $ 22 $ 2,792,406 $ (2,504,654) $ 287,774

~~Table of Contents~~

~~View, Inc.~~

~~Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)~~

~~(unaudited)~~

~~(in thousands)~~


	Common Stock		Additional Paid-In Capital		Accumulated Deficit		Total Stockholders’ Equity
		Shares							Amount



Balances as of December 31, 2022		3,696	$	—	$	2,814,912	$	(2,594,420)		$	220,492




Vesting of restricted stock units		58	—		—		—			—
Shares withheld related to net share settlement		(22)	—		(1,001)		—			(1,001)
Shares issued upon Convertible Notes conversion		280	—		17,828		—			17,828
Stock-based compensation		—	—		10,962		—			10,962
Net loss		—	—		—		(67,289)			(67,289)
Balances as of March 31, 2023		4,012	$	—	$	2,842,701	$	(2,661,709)		$	180,992
Vesting of restricted stock units		34	—		—		—			—
Shares withheld related to net share settlement		(13)	—		(293)		—			(293)

Stock-based compensation		—	—		10,530		—			10,530
Net loss		—	—		—		(56,360)			(56,360)
Balances as of June 30, 2023		4,033	$	—	$	2,852,938	$	(2,718,069)		$	134,869

Redeemable Convertible Preferred Stock Common Stock Additional
Paid-In
Capital Accumulated
Deficit Total
Stockholders’
Equity (Deficit)
Shares Amount Shares Amount
Balances as of December 31, 2020 5,222,852 $ 1,812,678 73,483 $ 7 $ 89,782 $ (1,914,353) $ (1,824,564)
Retroactive application of reverse recapitalization (Note 2)
(5,101,421) — (71,774) (7) 7 — —
Balances as of December 31, 2020, as converted 121,431 $ 1,812,678 1,709 $ — $ 89,789 $ (1,914,353) $ (1,824,564)
Conversion of redeemable convertible preferred stock to common stock in connection with reverse recapitalization (121,431) (1,812,678) 121,431 12 1,812,666 — 1,812,678
Reverse recapitalization transaction, net of fees — — 93,865 10 745,741 — 745,751
Conversion of redeemable convertible preferred stock warrants to common stock warrants in connection with reverse recapitalization — — — — 7,267 — 7,267
Issuance of common stock upon exercise of stock options — — 72 — 382 — 382
Stock-based compensation — — — — 10,463 — 10,463
Net loss — — — — — (74,035) (74,035)
Balances as of March 31, 2021 — $ — 217,077 $ 22 $ 2,666,308 $ (1,988,388) $ 677,942
Issuance of common stock upon exercise of stock options — — 4 — 31 — 31
Vesting of restricted stock units — — 35 — — — —
Stock-based compensation — — — — 22,274 — 22,274
Net loss — — — — — (95,720) (95,720)
Balances as of June 30, 2021 — $ — 217,116 $ 22 $ 2,688,613 $ (2,084,108) $ 604,527
Vesting of restricted stock units — — 40 — — — —
Stock-based compensation — — — — 22,470 — 22,470
Net loss — — — — — (94,152) (94,152)
Balances as of September 30, 2021 — $ — 217,156 $ 22 $ 2,711,083 $ (2,178,260) $ 532,845




Balances as of December 31, 2021	3,653	$	—	$	2,736,669	$	(2,257,331)	$	479,338
Vesting of restricted stock units	1	—		—		—		—
Stock-based compensation	—	—		17,468		—		17,468
Net loss	—	—		—		(82,372)		(82,372)
Balances as of March 31, 2022	3,654	$	—	$	2,754,137	$	(2,339,703)	$	414,434
Vesting of restricted stock units	—	—		—		—		—
Stock-based compensation	—	—		18,141		—		18,141
Net loss	—	—		—		(82,886)		(82,886)
Balances as of June 30, 2022	3,654	$	—	$	2,772,278	$	(2,422,589)	$	349,689

Share and per share data have been adjusted for all periods presented to reflect the 60-for-1 reverse stock split effective July 26, 2023.

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

View, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(in thousands)


		Nine Months Ended September 30,						Six Months Ended June 30,
			2022		2021				2023		2022
Cash flows from operating activities:	Cash flows from operating activities:						Cash flows from operating activities:
Net loss	Net loss		$	(247,323)	$	(263,907)	Net loss		$	(123,649)	$	(165,258)
Adjustments to reconcile net loss to net cash used in operating activities:	Adjustments to reconcile net loss to net cash used in operating activities:						Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	Depreciation and amortization		17,797		35,200		Depreciation and amortization		11,015		11,874
Loss on extinguishment of debt			—		10,018

Gain on fair value change, net	Gain on fair value change, net		(6,511)		(18,426)		Gain on fair value change, net		(513)		(6,285)
Stock-based compensation	Stock-based compensation		58,835		55,207		Stock-based compensation		21,952		35,609

Non-cash interest expense							Non-cash interest expense		9,297		—
Impairment of note receivable							Impairment of note receivable		4,000		—
Other	Other		1,008		1,524		Other		2,893		524
Changes in operating assets and liabilities:	Changes in operating assets and liabilities:						Changes in operating assets and liabilities:
Accounts receivable	Accounts receivable		6,693		(6,683)		Accounts receivable		5,403		(256)
Inventories	Inventories		(7,585)		(3,272)		Inventories		(459)		(6,851)
Prepaid expenses and other current assets	Prepaid expenses and other current assets		(11,090)		(7,254)		Prepaid expenses and other current assets		1,699		(644)
Other assets	Other assets		2,616		(472)		Other assets		(4,553)		1,972
Accounts payable	Accounts payable		(2,803)		(2,226)		Accounts payable		(1,372)		(8,724)
Deferred revenue	Deferred revenue		(3,783)		963		Deferred revenue		(2,725)		(3,556)
Accrued compensation	Accrued compensation		1,922		1,661		Accrued compensation		(2,265)		8
Accrued expenses and other liabilities	Accrued expenses and other liabilities		(13,977)		8,923		Accrued expenses and other liabilities		(28,342)		(11,661)
Net cash used in operating activities	Net cash used in operating activities		(204,201)		(188,744)		Net cash used in operating activities		(107,619)		(153,248)
Cash flows from investing activities:	Cash flows from investing activities:						Cash flows from investing activities:
Purchases of property and equipment	Purchases of property and equipment		(14,396)		(15,419)		Purchases of property and equipment		$	(7,240)	$	(12,147)
Purchases of short-term investments							Purchases of short-term investments		(106,032)		—
Maturities of short-term investments							Maturities of short-term investments		160,133		—
Disbursement under loan receivable (Note 4)							Disbursement under loan receivable (Note 4)		(3,001)		(1,589)

Disbursement under loan receivable (Note 7)			(5,160)		—
Acquisition, net of cash acquired			—		(4,938)
Net cash used in investing activities			(19,556)		(20,357)
Net cash provided by (used in) investing activities							Net cash provided by (used in) investing activities		43,860		(13,736)
Cash flows from financing activities:	Cash flows from financing activities:						Cash flows from financing activities:
Payment of debt issuance costs (Note 7)							Payment of debt issuance costs (Note 7)		$	(228)	$	—

Repayment of revolving debt facility (Note 8)			—		(257,454)
Repayment of other debt obligations	Repayment of other debt obligations		(735)		—		Repayment of other debt obligations		—		(735)
Payments of obligations under finance leases	Payments of obligations under finance leases		(400)		(520)		Payments of obligations under finance leases		(269)		(264)
Proceeds from issuance of common stock upon exercise of stock options			—		403
Proceeds from reverse recapitalization and PIPE financing (Note 2)			—		815,184
Payment of transaction costs related to reverse recapitalization (Note 2)			—		(41,655)
Taxes paid related to the net share settlement of equity awards (Note 9)			(3,076)		—
Net cash (used in) provided by financing activities			(4,211)		515,958
Net (decrease) increase in cash, cash equivalents, and restricted cash			(227,968)		306,857

Taxes paid related to the net share settlement of equity awards (Note 8)							Taxes paid related to the net share settlement of equity awards (Note 8)		(1,293)		—
Net cash used in financing activities							Net cash used in financing activities		(1,790)		(999)
Net decrease in cash, cash equivalents, and restricted cash							Net decrease in cash, cash equivalents, and restricted cash		(65,549)		(167,983)
Cash, cash equivalents, and restricted cash, beginning of period	Cash, cash equivalents, and restricted cash, beginning of period		297,543		74,693		Cash, cash equivalents, and restricted cash, beginning of period		114,165		297,543
Cash, cash equivalents, and restricted cash, end of period	Cash, cash equivalents, and restricted cash, end of period		$	69,575	$	381,550	Cash, cash equivalents, and restricted cash, end of period		$	48,616	$	129,560
Supplemental disclosure of cash flow information:	Supplemental disclosure of cash flow information:						Supplemental disclosure of cash flow information:
Cash paid for interest	Cash paid for interest		$	55	$	19,366	Cash paid for interest		$	131	$	39

Non-cash investing and financing activities:	Non-cash investing and financing activities:						Non-cash investing and financing activities:
Payables and accrued liabilities related to purchases of property and equipment	Payables and accrued liabilities related to purchases of property and equipment		$	1,569	$	2,749	Payables and accrued liabilities related to purchases of property and equipment		$	1,043	$	2,674
Conversion of redeemable convertible preferred stock to common stock			$	—	$	1,812,678
Conversion of redeemable convertible preferred stock warrants to common stock warrants			$	—	$	7,267
Common stock issued in exchange for services associated with the reverse recapitalization			$	—	$	7,500

Common stock issued upon vesting of restricted stock units	Common stock issued upon vesting of restricted stock units		$	6,651	$	539	Common stock issued upon vesting of restricted stock units		$	3,371	$	49

Common stock issued upon conversion of Convertible Notes							Common stock issued upon conversion of Convertible Notes		$	18,000	$	—

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

View, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1.Organization and Summary of Significant Accounting Policies

Organization

View, Inc. ~~(f/k/a CF Finance Acquisition Corp. II)~~ and its wholly-owned subsidiaries (collectively “View” or the “Company”), headquartered in Milpitas, California, is a technology company that manufactures smart building products intended to help improve people’s health, productivity, and experience, while simultaneously reducing energy consumption. View’s primary product is a proprietary electrochromic or “smart” glass panel that when combined with View’s proprietary network infrastructure and software, intelligently adjusts in response to the sun by tinting from clear to dark states, and vice versa, thereby reducing heat and glare. The Company is devoting substantially all of its efforts towards the manufacturing, sale and further development of its product platforms, and marketing of both custom and standardized product solutions.

On March 8, 2021 (the “Closing Date” or “Closing”), CF Finance Acquisition Corp. II (“CF II”), a Delaware corporation, consummated the previously announced merger pursuant to an Agreement and Plan of Merger, dated November 30, 2020 (the “Merger Agreement”), by and among CF II, PVMS Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of CF II (“Merger Sub”), and View, Inc. (hereinafter referred to as “Legacy View”). Pursuant to the Merger Agreement, a business combination between CF II and Legacy View was effected through the merger of Merger Sub with and into Legacy View, with Legacy View (the “Business Combination”) surviving as the surviving company and as a wholly-owned subsidiary of CF II (the “Merger” and collectively with the other transactions described in the Merger Agreement, the “Transactions”). On the Closing Date, CF II changed its name from CF Finance Acquisition Corp. II to View, Inc. and Legacy View changed its name to View Operating Corporation.

On March 8, 2021, the Company completed the Transactions and raised net proceeds of $771.3 million, net of transaction costs of $43.9 million. In conjunction with the Transactions, the Company repaid in full the revolving debt facility of $276.8 million, including accrued interest and future interest through maturity of the notes of $26.8 million. See ~~Note 2~~ ~~for additional information regarding the reverse recapitalization.~~

Basis of Presentation

The condensed consolidated financial statements and accompanying notes have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and regulations of the U.S. Securities and Exchange Commission ~~(“SEC”~~(the “SEC”) for interim financial reporting and are unaudited. The Company’s condensed consolidated financial statements include the accounts of View, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The Company’s fiscal year ends on December 31.

Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, ~~2021,~~2022, included in the Company’s ~~2021~~2022 Annual Report on Form 10-K filed with the SEC on ~~June 15, 2022 (the “2021 Annual Report on Form 10-K”).~~March 31, 2023. The information as of December 31, ~~2021~~2022 included in the condensed consolidated balance sheets was derived from those audited consolidated financial statements.

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, there was no difference between net loss and total comprehensive loss.

As a result of the Transactions completed on March 8, 2021, prior period share and per share amounts presented in the accompanying condensed consolidated financial statements and these related notes have been retroactively converted in an amount determined by application of the exchange ratio of 0.02325 (“Exchange Ratio”), which was based on Legacy View’s implied price per share prior to the Merger.

The condensed consolidated financial statements were prepared on the same basis as the audited consolidated financial statements and included herein reflect all adjustments, including normal recurring adjustments, which are, in the opinion of management, necessary for a fair statement of the Company’s financial position as of ~~September~~June 30, ~~2022,~~2023, the results of operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and the cash flows for the ~~nine~~six months ended ~~September~~June 30, ~~2022.~~2023. The results of operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 are not necessarily indicative of the results that may be expected for the full year or any other future interim or annual periods.

All amounts are presented in U.S. dollars ($).

~~Table of Contents~~

~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

Liquidity and Going Concern

~~The accompanying condensed consolidated financial statements have been prepared on the basis that~~In accordance with Accounting Standards Codification (“ASC”) Topic 205-40, Going Concern, the Company ~~will continue as a going concern, which contemplates realization of assets~~evaluates whether there are certain conditions and ~~the satisfaction of liabilities~~events, considered in the ~~normal course of business. The financial statements do not include any adjustments that might be necessary should~~aggregate, which raise substantial doubt about the ~~Company be unable~~Company’s ability to continue as a going concern. ~~Since inception,~~As further detailed below, the Company has not achieved profitable operations or positive cash flows from operations. The Company’s accumulated deficit totaled $2,504.7 million as of September 30, 2022. For the nine months ended September 30, 2022, the Company had a net loss of approximately $247.3 million and negative cash flows from operations of approximately $204.2 million. In addition, for the nine months ended September 30, 2021, the Company had a net loss of approximately $263.9 million and negative cash flows from operations of approximately $188.7 million. Cash and cash equivalents as of September 30, 2022 was $51.3 million. The Company has historically financed its operations through the issuance and sale of redeemable convertible preferred stock, the issuance of debt financing, the gross proceeds associated with the Merger and revenue generation from product sales. The Company’s business will require significant amounts of capital to sustain operations and the Company will need to make the investments it needs to execute its long-term business plans.

The Company’s net cash outflow in the third quarter of 2022 decreased by $29.3 million when compared to the second quarter of 2022, from $89.3 million for the three months ended June 30, 2022 to $60.0 million for the three months ended September 30, 2022. In addition, as discussed further in ~~Note 14~~, the Company entered into an agreement on October 25, 2022 resulting in the sale of $200.0 million aggregate principal amount of Convertible Senior Pay in Kind (“PIK”) Toggle Notes (the “Notes”), generating net proceeds of approximately $194 million. As of October 31, 2022, the Company had approximately $228 million in cash and cash equivalents on hand.

Due to the historical rate of cash outflows, the Company is not currently able to conclude that its existing cash and cash equivalents balance as of the date of this filing will be adequate to fund its forecasted operating costs and meet its obligations; the Company has therefore determinedconcluded that there is substantial doubt about its ability to continue as a going ~~concern. While~~concern as the Company ~~plans to continue to reduce cash outflow when compared to prior periods, the Company’s ability~~estimates that its financial resources are adequate to fund its forecasted operating costs and meet its obligations into, but not beyond ~~twelve months from the date of this filing~~September 2023. This projection is dependent upon its ability to attain and maintain profitable operations by entering into profitable sales contracts and generating sufficient operating cash flow. The Company is evaluating the impact of the Investment Tax Credit (“ITC”) available to its customers under the Inflation Reduction Act of 2022 (“IRA”) passed by Congress and signed into law on August 16, 2022 and the potential positive impact it may havebased on the ~~future demand for the~~ Company’s ~~products~~current expectations regarding revenues, collections, cost structure, current cash burn rate and ~~the Company’s objective of profitable operations.~~

Ifother operating assumptions. To address its cash needs, the Company is ~~not able to achieve profitability prior to the depletion~~actively seeking additional sources of ~~its current cash and cash equivalents, it would be required to raise additional~~ capital. ~~While the Company has successfully raised additional capital during the current fiscal year,~~As there can be no assurance that ~~future~~such necessary financing will be available, the Company may execute other strategic alternatives to maximize stakeholder value, including further expense reductions, sale of all or portions of the business, corporate capital restructuring or formal reorganization, or liquidation of assets.

There can be no assurance that the necessary additional financing will be available on terms acceptable to the Company, or at all. If the Company raises funds in the future by issuing equity securities, ~~such as through the sale of the Company’s common stock under the common stock purchase agreements (the “Purchase Agreements”) discussed further in~~ ~~Note 9~~, dilution to stockholders will occur and may ~~result.~~be substantial. Any equity securities issued may also provide for rights, preferences, or privileges senior to those of holders of common stock. If the Company raises funds in the future by issuing additional debt securities, these debt securities could have rights, preferences, and privileges senior to those of preferred and common stockholders. The terms of any additional debt securities or borrowings could impose significant restrictions on the Company’s operations. The capital markets have experienced in the past, and may experience in the future, periods of upheaval that could impact the availability and cost of

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View, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

equity and debt financing. In addition, recent and anticipated future increases in federal fund rates set by the Federal Reserve, which serve as a benchmark for rates on borrowing, will continue to impact the cost of debt financing.

IfThe accompanying condensed consolidated financial statements have been prepared on the basis that the Company iswill continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments that might be necessary should the Company be unable to ~~obtain adequate capital resources to fund operations by attaining and maintaining~~continue as a going concern. Since inception, the Company has not achieved profitable operations or ~~raising~~positive cash flows from operations. The Company’s accumulated deficit totaled $2,718.1 million as of June 30, 2023. For the six months ended June 30, 2023, the Company had a net loss of approximately $123.6 million and negative cash flows from operations of approximately $107.6 million. In addition, for the six months ended June 30, 2022, the Company had a net loss of approximately $165.3 million and negative cash flows from operations of approximately $153.2 million. Cash and cash equivalents were $30.1 million and short-term investments were $49.8 million as of June 30, 2023. The Company has historically financed its operations through revenue generation from product sales, the issuance and sale of redeemable convertible preferred stock, the issuance of debt financing, and the gross proceeds associated with the contribution of cash and the issuance of private investment in public equity (“PIPE”) in connection with the Company’s merger completed on March 8, 2021. As noted in Note 7, the Company raised additional capital of $206.3 million, after deducting fees and offering expenses, during the fourth quarter of 2022 through the issuance of Convertible Senior Pay in Kind (“PIK”) Toggle Notes (the “Convertible Notes”).

In order to reduce the cash used in operating activities, the Company ~~would not be able~~implemented certain cost savings initiatives in the second half of 2022, as well as a restructuring plan in March 2023 as further discussed in Note 11. While these plans are anticipated to ~~continue~~reduce cash outflow when compared to ~~operate the business pursuant to~~prior periods, the Company’s current business plan, which would require the Company to modify its operations to reduce spending to a sustainable level by, among other things, delaying, scaling back or eliminating some or all of the Company’s ongoing or planned investments in corporate infrastructure, business development, sales and marketing, research and development and other activities, which would have a material impact on the Company’s operations andcontinued existence is dependent upon its ability to ~~increase revenues, or the Company may be forced~~obtain additional financing, as well as to ~~discontinue~~attain and maintain profitable operations by entering into profitable sales contracts and generating sufficient cash flow to meet its ~~operations entirely.~~obligations on a timely basis. The Company’s business will require a significant amount of capital investments to execute its long-term business plans.

Summary of Significant Accounting Policies

There have been no significant changes to the significant accounting policies disclosed in Note 1 of the audited consolidated financial statements as of and for the year ended December 31, ~~2021~~2022 included in the Company’s ~~2021~~2022 Annual Report on Form ~~10-K.~~

~~Table of Contents~~

~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

10-K filed with the SEC on March 31, 2023.

Concentration of Credit Risk and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash and cash equivalents, restricted cash, and accounts receivable. Cash and cash equivalents are almost entirely held by domestic financial institutions with high credit standings. Such deposits may, at times, exceed federally insured limits. As of ~~September~~June 30, ~~2022,~~2023, the Company has not experienced any losses on its deposits of cash and cash equivalents.

For the ~~nine~~six months ended ~~September~~June 30, 2023, three customers represented greater than 10.0% of total revenue, accounting for 16.0% 13.4%, and 11.4% of total revenue, respectively. For the six months ended June 30, 2022, two customers represented greater than 10.0% of total revenue, accounting for ~~16.2%~~16.9% and ~~15.5%~~16.6% of total revenue, respectively. ~~For the nine months ended September 30, 2021, two customers represented greater than 10.0% of total revenue, accounting for 16.1% and 11.2% of total revenue, respectively. Four customers~~One customer accounted for ~~50.8%~~23.7% of accounts receivable, net as of ~~September~~June 30, ~~2022, each accounting for 15.4%, 13.4%, 12.0%, and 10.0% of accounts receivable, net, respectively. Four~~2023. Two customers accounted for ~~53.0%~~27.3% of accounts receivable, net as of December 31, ~~2021,~~2022, accounting for ~~15.2%, 13.3%, 12.8%~~17.3% and ~~11.8% of accounts receivable, net,~~10.0%, respectively. Accounts receivable are stated at the amount the Company expects to collect. The Company generally does not require collateral or other security in support of accounts receivable. To reduce credit risk, management performs ongoing credit evaluations of its customers’ financial condition.

Certain materials used by the Company in the manufacturing of its products are purchased from a limited number of suppliers. ~~Shortages could occur~~Should any such supplier cease to manufacture the products the Company purchases from them or become unable to timely deliver these products in ~~these materials due~~accordance with the Company’s requirements or should such suppliers choose not to ~~an interruption of supply or increased demand~~do business with the Company, it may be required to locate alternative suppliers in the ~~industry.~~open market. There can be no assurance that the Company would be able to identify new suppliers with which to do business on terms acceptable to the Company, or at all. For the ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, each of ~~four~~two suppliers accounted for ~~26.7%, 12.9%, 11.2%,~~31.3% and ~~10.1%~~17.9% of total purchases, respectively. For the ~~nine~~six months ended ~~September~~June 30, ~~2021, one supplier~~2022, three suppliers accounted for ~~35.0%~~20.0%, 19.1% and 14.2% of total ~~purchases.~~purchases, respectively.

Segment Reporting

Operating segments are defined as components of an entity where discrete financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company operates and manages its business as one reportable and operating segment. The Company’s chief executive officer, who is the chief

Table of Contents

View, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

operating decision maker, reviews financial information on a consolidated basis for purposes of allocating resources and assessing performance. All material long-lived assets are maintained in the United States. See “Concentration of Credit Risk and Other Risks and Uncertainties” for further information on revenue by customer and Note 32 for further information on revenue by geography and categorized by products and services.

~~Recent Accounting Pronouncements, Adopted~~Reverse Stock Split

~~In May 2021,~~On July 25, 2023, the ~~FASB issued ASU No. 2021-04,~~ ~~Earnings Per Share (Topic 260)~~Company held its 2023 annual meeting of stockholders (the “Annual Meeting”), Debt — Modifications and Extinguishments (Subtopic 470-50), Compensation — Stock Compensation (Topic 718), and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchangesat which the Company’s stockholders approved an amendment to the Company’s Certificate of ~~Freestanding Equity-Classified Written Call Options~~ ~~(“ASU No. 2021-04”). This ASU provides~~Incorporation to effect a principles-based framework for issuers to account for a modification or exchange of freestanding equity-classified written call options that remain equity classified after the modification or exchange based on the economic substancereverse stock split of the ~~modification~~common stock at a reverse stock split ratio of 40-for-1, 45-for-1, 50-for-1, 55-for-1 or ~~exchange. The Company adopted this standard as~~60-for-1, such ratio to be fixed by the Company’s board of directors at a later date. Following the Annual Meeting, on July 25, 2023, the Company’s board of directors approved the implementation of the ~~first quarter~~reverse stock split at a ratio of ~~2022~~60-for-1 (the “Reverse Stock Split”). On July 26, 2023, the Company filed a Certificate of Amendment to the Company’s Amended and ~~the adoption did not have an impact on the condensed consolidated financial statements.~~

~~Recent Accounting Pronouncements, Not Yet Adopted~~

~~In August 2020, the FASB issued No. ASU 2020-06,~~ Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity ~~(“ASU 2020-06”)~~. This ASU simplifies accounting for convertible instruments by removing major separation models required under current U.S. GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument and more convertible preferred stock as a single equity instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU also simplifies the diluted earnings per share (“EPS”) calculation in certain areas. ASU 2020-6 is effective for fiscal years beginning after December 15, 2023 including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating whether this guidance will have a significant impact on its condensed consolidated financial statements.

2.~~Reverse Recapitalization~~

~~In connection~~Restated Certificate of Incorporation with the ~~Merger, the Company raised $815.2 million~~Secretary of ~~gross proceeds including the contribution of $374.1 million of cash held in CF II’s trust account from its initial public offering, net of redemptions of CF II Class A Common Stock~~

~~Table of Contents~~

~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

held by CF II’s public stockholders of $125.9 million, $260.8 million of private investment in public equity (“PIPE”) at $10.00 per share of CF II’s Class A Common Stock, and $180.3 million of additional PIPE at $11.25 per share of CF II’s Class A Common Stock.

~~Immediately before the Merger, all of Legacy View’s outstanding warrants were net exercised for shares of Legacy View Class A common stock. Upon consummation~~State of the ~~Merger, all holders~~State of ~~Legacy View Class A common~~Delaware to effect a 60-for-1 reverse stock ~~and redeemable convertible preferred stock received~~split of the outstanding shares of the Company’s Class A common ~~stock at a deemed value of $10.00 per share after giving effect to~~stock. The Reverse Stock Split became effective upon the ~~Exchange Ratio based on the completion~~filing of the ~~following transactions contemplated by the Merger Agreement:~~

•~~the cancellation~~Certificate of ~~each issued and outstanding share of Legacy View Capital Stock~~Amendment on July 26, 2023 and the ~~conversion into~~Company’s common stock began trading on a split-adjusted basis at market open on July 27, 2023.

No fractional common shares were issued as a result of the ~~right~~Reverse Stock Split. Any stockholder who would have been entitled to receive a ~~number of shares of View, Inc. Class A Common Stock equal to the Exchange Ratio;~~

•the conversion of all outstanding Legacy View Warrants into warrants exercisable for shares of View Inc. Class A Common Stock with the same terms except for the number of shares exercisable and the exercise price, each of which was adjusted using the Exchange Ratio; and

•the conversion of all outstanding vested and unvested Legacy View Options into options exercisable for shares of View Inc. Class A Common Stock with the same terms except for the number of shares exercisable and the exercise price, each of which was adjusted using the Exchange Ratio.

In connection with the Merger, the Company incurred $43.9 million of Transaction costs, consisting of underwriting, legal, and other professional fees, of which $42.4 million was recorded to additional paid-in capitalfractional share as a ~~reduction of proceeds and the remaining $1.5 million was expensed immediately.~~

~~The number of shares of Class A common stock issued immediately following the consummation~~result of the ~~Merger on March 8, 2021 was:~~


			~~Number of Shares~~
~~Common stock of CF II outstanding prior to the Merger~~ 1			~~62,500,000~~
~~Less redemption of CF II shares~~			~~(12,587,893)~~
~~CF II Sponsor Earnout Shares outstanding prior to the Merger~~			~~1,100,000~~
~~Common stock of CF II~~			~~51,012,107~~
~~Shares issued in PIPE financing~~			~~42,103,156~~
~~Shares issued for in kind banker fee payment~~			~~750,000~~
~~Merger and PIPE financing shares~~			~~42,853,156~~
~~Legacy View shares converted~~ 2			~~123,211,449~~
~~Total~~			~~217,076,712~~

~~_______________________~~

1~~Includes CF II Class A stockholders~~Reverse Stock Split received cash payments in lieu of ~~50,000,000~~such fractional shares. All share and ~~CF II Class B stockholders of 12,500,000.~~

2~~The number of Legacy View shares was determined from~~per share information included in the 76,565,107 shares of Legacy View common stock and 5,222,852,052 shares of Legacy View redeemable convertible preferred stock outstanding, which were converted to an equal number of shares of Legacy View common stock upon the closing of the Merger, and then converted at the Exchange Rate to Class A common stock of the Company. All fractional shares were rounded down to the nearest whole share.

The Merger was accounted for as a reverse recapitalization because Legacy View was determined to be the accounting acquirer. Under this method of accounting, CF II was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, theaccompanying financial statements of the Company will represent a continuation of the financial statements of Legacy View with the Merger treated as the equivalent of Legacy View issuing stock for the net assets of CF II, accompanied by a recapitalization. The net assets of CF II will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations priorhas been retrospectively adjusted to ~~the Merger are those of Legacy View.~~

~~Legacy View was determined to be the accounting acquirer based on the following facts and circumstances:~~

•~~Legacy View stockholders comprised a relative majority of voting power of View;~~

•~~Legacy View had the ability to nominate a majority of the members of the board of directors of View;~~

~~Table of Contents~~

~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

•~~Legacy View’s operations prior to the acquisition comprising the only ongoing operations of View;~~

•~~Legacy View’s senior management comprising a majority of the senior management of View; and~~

•~~View substantially assuming the Legacy View name.~~reflect this Reverse Stock Split.

3.2.Revenue

Disaggregation of Revenue

The Company disaggregates revenue between products and services, as well as by major product offering and by geographic market that depict the nature, amount, and timing of revenue and cash flows.

The following table summarizes the Company’s revenue by products and services (in thousands):


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended June 30,				Six Months Ended June 30,
		2022		2021		2022		2021			2023		2022		2023		2022
Revenue:	Revenue:									Revenue:
Products	Products	$	21,548	$	17,684	$	52,461	$	44,209	Products	$	27,377	$	15,380	$	45,297	$	30,913
Services	Services	2,214		1,200		4,629		1,370		Services	657		936		1,085		2,415
Total	Total	$	23,762	$	18,884	$	57,090	$	45,579	Total	$	28,034	$	16,316	$	46,382	$	33,328

View Smart Glass contracts to provide Controls, Software and Services (“CSS”) include the sale of both products and services. These services primarily relate to CSS installation and commissioning and are presented in the table above as Services. Also included within Services in the table above are revenues associated with extended or enhanced warranties. View Smart Glass contracts to provide insulating glass units (“IGUs”), View Smart Building Platform contracts and View Smart Building Technologies contracts relate to the sale of products.

The following table summarizes the Company's revenue by major product offering (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 2022 2021
Revenue:
Smart Building Platform $ 11,317 $ 9,876 $ 29,578 $ 15,012
Smart Glass 10,320 8,410 19,809 28,205
Smart Building Technologies 2,125 598 7,703 2,362
Total $ 23,762 $ 18,884 $ 57,090 $ 45,579

During the three months ended September 30, 2022 and 2021, the Company recognized a total of $1.5 million and $10.3 million, respectively, for initial contract loss accruals and incurred $4.2 million and $4.6 million, respectively, of previously accrued losses, which resulted in a decrease to the accrual. During the nine months ended September 30, 2022 and 2021, the Company recognized a total of $4.0 million and $24.5 million, respectively, for initial contract loss accruals and incurred $12.3 million and $7.5 million, respectively, of previously accrued losses, which resulted in a decrease to the accrual.

Changes in estimated costs to complete View Smart Building Platform projects and the related effect on revenue are recognized using a cumulative catch-up adjustment which recognizes in the current period the cumulative effect of the changes on current and prior periods based on a contract’s progress towards fulfillment of the performance obligation. The cumulative catch-up adjustments were $0.6 million and $0.1 million for the three months ended September 30, 2022 and 2021, respectively. The cumulative catch-up adjustments were $1.4 million and nil for the nine months ended September 30, 2022 and 2021, respectively.

~~The balance of estimated contract losses for work that had not yet been completed totaled $10.9 million and $20.7 million as of September 30, 2022 and December 31, 2021, respectively.~~


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Revenue:
Smart Building Platform	$	18,012	$	9,055	$	28,656	$	18,261
Smart Glass	7,721		4,306		12,373		9,489
Smart Building Technologies	2,301		2,955		5,353		5,578

Total	$	28,034	$	16,316	$	46,382	$	33,328

1411

Table of Contents

View, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The following table summarizes the Company’s revenue by geographic area, which is based on the shipping ~~address~~addresses of the customers (in thousands):


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended June 30,				Six Months Ended June 30,
		2022		2021		2022		2021			2023		2022		2023		2022
Revenue:	Revenue:									Revenue:
United States	United States	$	21,743	$	15,682	$	52,852	$	37,400	United States	$	25,919	$	14,825	$	42,969	$	31,109
Canada	Canada	2,009		2,968		4,170		7,475		Canada	2,115		1,443		3,413		2,161
Other	Other	10		234		68		704		Other	—		48		—		58
Total	Total	$	23,762	$	18,884	$	57,090	$	45,579	Total	$	28,034	$	16,316	$	46,382	$	33,328

Contract Estimates

Significant changes in estimated costs expected to complete View Smart Building Platform contracts could affect the profitability of our contracts. Changes to estimated profit on contracts are recognized using a cumulative catch-up adjustment which recognizes in the current period the cumulative effect of the changes on current and prior periods based on a contract’s progress towards fulfillment of the performance obligation. When the total estimated costs to be incurred for a contract exceed the transaction price, an accrual for the loss on the contract is recognized as cost of revenue in the period the contract is signed, and adjusted periodically as estimates are revised. As actual costs are incurred that are in excess of revenue recognized, they are recorded against the loss accrual, which is therefore reduced.

During the three months ended June 30, 2023 and 2022, the Company recognized a total of $1.0 million and zero, respectively, for initial contract loss accruals and incurred $6.3 million and $4.2 million, respectively, of previously accrued losses, which resulted in a decrease to the accrual. During the six months ended June 30, 2023 and 2022, the Company recognized a total of $1.6 million and $2.5 million, respectively, for initial contract loss accruals and incurred $8.2 million and $8.2 million, respectively, of previously accrued losses, which resulted in a decrease to the accrual. The cumulative catch-up adjustments resulting from changes in estimated profit on contracts were $(6.0) million and nil for the three months ended June 30, 2023 and 2022, respectively. The cumulative catch-up adjustments resulting from changes in estimated profit on contracts were $(3.8) million and $0.8 million for the six months ended June 30, 2023 and 2022, respectively. The balance of estimated contract losses for work that had not yet been completed totaled $12.2 million and $15.0 million as of June 30, 2023 and December 31, 2022, respectively.

Remaining Performance Obligations

The Company’s IGU contracts are short-term in nature and the practical expedient has been applied. The Company’s performance obligations in CSS contracts are generally short-term in nature, for which the practical expedient has been applied, with the exception of commissioning services, which are provided at the end of a construction project. Revenue for commissioning services performance obligations is not material. The Company’s performance obligations in Smart Building Platform contracts are longer-term in nature, however many of these contracts provide the customer with a right to cancel or terminate for convenience with no substantial penalty. The transaction price allocated to remaining performance obligations for non-cancelable Smart Building Platform contracts as of ~~September~~June 30, ~~2022~~2023 was ~~$13.7~~$6.8 million that the Company expects to recognize as it satisfies the performance obligations over the next 12 to 24 months, which are, among other things, dependent on the construction schedule of the site for which the Company's products and services are provided. The Company’s performance obligations in Smart Building Technologies contracts are generally short-term in nature, for which the practical expedient has been applied.

Contract Assets and Liabilities

Contract assets reflect revenue recognized and performance obligations satisfied in advance of customer billing, where payment is conditional, as well as retainage for amounts that the Company has billed to the customer but are being held for payment by the customer pending satisfactory completion of the project. Current contract assets as of ~~September~~June 30, ~~2022~~2023 and December 31, ~~2021~~2022 were ~~$14.6~~$17.0 million and ~~$11.5~~$14.6 million, respectively, and were included in other current assets. ~~The increase in 2022 primarily relates to contract assets associated with View Smart Building Platform contracts, which commenced in 2021.~~ The progress billing schedules for these contracts result in timing differences as compared to the Company’s satisfaction of its performance obligation. Non-current contract assets as of ~~September~~June 30, ~~2022~~2023 and December 31, ~~2021~~2022 were ~~$0.1~~$1.2 million and $0.7 million, respectively, and were included in other assets.

Contract liabilities relate to amounts invoiced or consideration received from customers, typically for the Company’s CSS contracts, in advance of the Company’s satisfaction of the associated performance obligation. Such contract liabilities are ~~recognized as revenue when the performance obligation is satisfied. Contract liabilities are presented as deferred revenue on the condensed consolidated balance sheets.~~

Revenue recognized during the three and nine months ended September 30, 2022, which was included in the opening contract liability balance as of December 31, 2021 was $1.3 million and $5.5 million, respectively. Revenue recognized during the three and nine months ended September 30, 2021, which was included in the opening contract liability balance as of December 31, 2020 was insignificant in both periods.

4.~~Fair Value~~

Fair value is defined as an exchange price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be either recorded or disclosed at fair value, the Company considers the principal or most advantageous market in which it would transact, and it also considers assumptions that market participants would use when pricing the asset or liability.

The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. U.S. GAAP establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is as follows:

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Table of Contents

View, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

~~Level 1 Observable inputs such~~recognized as ~~quoted prices~~revenue when the performance obligation is satisfied. Contract liabilities are presented as deferred revenue on the condensed consolidated balance sheets.

Revenue recognized during the three and six months ended June 30, 2023, which was included in ~~active markets for identical assets or liabilities that~~ the ~~Company has~~opening contract liability balance as of December 31, 2022, was $1.0 million and $4.2 million, respectively. Revenue recognized during the ~~ability to access at the measurement date.~~

~~Level 2 Inputs other than the quoted prices in active markets that are observable either directly or indirectly.~~

~~Level 3 Unobservable inputs in which there are little or no market data~~three and ~~which require the Company to develop its own assumptions.~~

At Closing, the Sponsor subjected 4,970,000 shares (“Sponsor Earn-Out Shares”) to vesting and potential forfeiture (and related transfer restrictions) based on a five year post-Closing earnout, with (a) 50% of the Sponsor Earn-Out Shares being released if the stock price of the Company exceeds $12.50 for 5 out of any 10 trading days, (b) 25% of the Sponsor Earn-Out Shares being released if the stock price of the Company exceeds $15.00 for 5 out of any 10 trading days and (c) 25% of the Sponsor Earn-Out Shares being released if the stock price of the Company exceeds $20.00 for 5 out of any 10 trading days, in each case, subject to early release for a sale, change of control or going private transaction or delisting after the Closing (collectively, the “Earn-Out Triggering Events”).

These Sponsor Earn-Out Shares are accounted for as liability classified instruments because the Earn-Out Triggering Events that determine the number of Sponsor Earn-Out Shares to be earned back by the Sponsor include events that are not solely indexed to the common stock of the Company. As of Septembersix months ended June 30, 2022, which was included in the ~~Earn-Out Triggering Events were not achieved for any~~opening contract liability balance as of ~~the tranches~~December 31, 2021, was $1.9 million and ~~as such the Company adjusted the carrying amount of the liability to its estimated fair value.~~$4.2 million, respectively.

3.Fair Value

The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis (in thousands):


		September 30, 2022									June 30, 2023
		Level 1		Level 2		Level 3		Total			Level 1		Level 2		Total
Cash equivalents:	Cash equivalents:									Cash equivalents:
Money market funds	Money market funds	$	27,921	$	—	$	—	$	27,921	Money market funds	$	21,850	$	—	$	21,850
Total cash equivalents		27,921		—		—		27,921

Restricted cash:	Restricted cash:									Restricted cash:
Certificates of deposit	Certificates of deposit	—		18,304		—		18,304		Certificates of deposit	—		18,472		18,472
Short-term investments										Short-term investments	—		49,824		49,824
Total assets measured at fair value	Total assets measured at fair value	$	27,921	$	18,304	$	—	$	46,225	Total assets measured at fair value	$	21,850	$	68,296	$	90,146

Sponsor earn-out liability		$	—	$	—	$	1,260	$	1,260
Private warrants liability		—		—		27		27
Total liabilities measured at fair value		$	—	$	—	$	1,287	$	1,287

December 31, 2021
Level 1 Level 2 Level 3 Total
Cash equivalents:
Money market funds $ 247,500 $ — $ — $ 247,500
Total cash equivalents 247,500 — — 247,500
Restricted cash:
Certificates of deposit — 16,462 — 16,462
Total assets measured at fair value $ 247,500 $ 16,462 $ — $ 263,962
Sponsor earn-out liability $ — $ — $ 7,624 $ 7,624
Private warrants liability — — 174 174
Total liabilities measured at fair value $ — $ — $ 7,798 $ 7,798

~~Table of Contents~~

~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~


	December 31, 2022
	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	66,614	$	—	$	—	$	66,614

Restricted cash:
Certificates of deposit	—		18,308		—		18,308
Short-term investments	—		102,284		—		102,284
Total assets measured at fair value	$	66,614	$	120,592	$	—	$	187,206


Sponsor earn-out liability	$	—	$	—	$	506	$	506
Private warrants liability	—		—		7		7
Total liabilities measured at fair value	$	—	$	—	$	513	$	513

The following table provides a reconciliation of the beginning and ending balances for the level 3 financial liabilities measured at fair value using significant unobservable inputs (in thousands):

Sponsor
Earn-out
Liability Private
Warrants
Balance as of December 31, 2021 $ 7,624 $ 174
Change in fair value (6,364) (147)
Balance as of September 30, 2022 $ 1,260 $ 27


	Sponsor Earn-out Liability		Private Warrants
Balance as of December 31, 2022	$	506	$	7

Change in fair value	(506)		(7)

Balance as of June 30, 2023	$	—	$	—

Sponsor Earn-out Shares, as defined below, and the Company’s privately placed warrants (“Private ~~Warrants and redeemable convertible preferred stock warrants~~Warrants”) are ~~or were~~ subject to remeasurement to fair value at each balance sheet date. ~~See~~ ~~Note 2~~ ~~for additional information regarding the reverse recapitalization and the conversion of the redeemable convertible preferred stock warrants at the time of the Merger.~~ Changes in fair value as a result of the remeasurement are recognized in

gain on fair value change, net in the condensed consolidated statements of comprehensive loss.

The following table summarizes the ~~(gain) loss~~gain on fair value change, net (in thousands):


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended June 30,				Six Months Ended June 30,
		2022		2021		2022		2021			2023		2022		2023		2022
Sponsor Earn-out Liability	Sponsor Earn-out Liability	$	(225)	$	(12,771)	$	(6,364)	$	(13,113)	Sponsor Earn-out Liability	$	(6)	$	(1,846)	$	(506)	$	(6,139)
Private Warrants	Private Warrants	(1)		(307)		(147)		(257)		Private Warrants	—		(58)		(7)		(146)
Redeemable Convertible Preferred Stock Warrants		—		—		—		(5,056)
(Gain) loss on fair value change, net		$	(226)	$	(13,078)	$	(6,511)	$	(18,426)

Gain on fair value change, net										Gain on fair value change, net	$	(6)	$	(1,904)	$	(513)	$	(6,285)

Valuation of Sponsor Earn-Out ~~liability~~Liability

In conjunction with the Company’s merger completed on March 8, 2021, CF Finance Holdings II, LLC (the “Sponsor”) subjected 82,835 shares (the “Sponsor Earn-Out Shares”) to vesting and potential forfeiture (and related transfer restrictions) based on a five year post-closing earnout, with (a) 50% of the Sponsor Earn-Out Shares being released if the stock price of the Company exceeds $750.00 for 5 out of any 10 trading days, (b) 25% of the Sponsor Earn-Out Shares being released if the stock price of the Company exceeds $900.00 for 5 out of any 10 trading days and (c) 25% of the Sponsor Earn-Out Shares being released if the stock price of the Company exceeds $1,200.00 for 5 out of any 10 trading days, in each case, subject to early release for a sale, change of control or going private transaction or delisting after March 8, 2021 (collectively, the “Earn-Out Triggering Events”).

The estimated fair value of the Sponsor Earn-Out Shares of $0.0 million and $0.5 million as of June 30, 2023 and December 31, 2022, respectively, was determined using a Monte Carlo simulation valuation model using the following assumptions:


		September 30, 2022	December 31, 2021		June 30, 2023	December 31, 2022
Stock price	Stock price	$1.34	$3.91	Stock price	$7.26	$57.90
Expected volatility	Expected volatility	70.25%	52.50%	Expected volatility	64.25%	69.25%
Risk free rate	Risk free rate	4.20%	1.12%	Risk free rate	4.61%	4.22%
Expected term (in years)	Expected term (in years)	3.4	4.2	Expected term (in years)	2.7	3.2
Expected dividends	Expected dividends	0%	0%	Expected dividends	0%	0%

Current stock price: The stock price was based on the closing price as of the valuation date.

Expected volatility: The volatility rate ~~of the Sponsor Earn-Out Shares~~ was determined using a Monte Carlo simulation to estimate the implied volatility of the Company’s publicly traded warrants (“Public ~~Warrants as such warrants are publicly traded.~~Warrants”).

Risk-free interest rate: The risk-free interest rate is based on the U.S. Treasury yield curve for zero-coupon U.S. Treasury notes with maturities corresponding to the remaining expected term of the earnout period.

Expected term: The expected term is the remaining contractual term of the earnout period.

Expected dividend yield: The expected dividend rate is zero as the Company currently has no history or expectation of declaring dividends in the foreseeable future.

~~Table of Contents~~

~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

Valuation of Private Warrants

The estimated fair value of the Private Warrants of $0.0 million as of both June 30, 2023 and December 31, 2022, was determined using the Black-Scholes option-pricing model using the following assumptions:


		September 30, 2022	December 31, 2021		June 30, 2023	December 31, 2022
Stock price	Stock price	$1.34	$3.91	Stock price	$7.26	$57.90
Expected volatility	Expected volatility	70.25%	52.50%	Expected volatility	64.25%	69.25%
Risk free rate	Risk free rate	4.25%	1.04%	Risk free rate	4.72%	4.32%
Expected term (in years)	Expected term (in years)	2.9	3.7	Expected term (in years)	2.2	2.7
Expected dividends	Expected dividends	0%	0%	Expected dividends	0%	0%

Other

The carrying amounts of cash equivalents relating to demand deposits and U.S. Treasury bills, accounts receivable, and accounts payable approximates fair value due to the short maturity of these instruments. The carrying amount of long-term trade ~~receivable~~receivables approximates fair value, which is estimated by discounting expected future cash flows using an average discount rate adjusted for the customer's creditworthiness. Short-term and long-term debt associated with the term loan are carried at amortized cost, which approximates its fair value. The Convertible Notes are carried at amortized cost and their fair value is determined using Level 3 inputs, as discussed further in Note 7.

5.4.Other Balance Sheet Information

Cash, Cash Equivalents and Restricted Cash

Cash, cash equivalents, and restricted cash reported within the accompanying condensed consolidated balance sheets that sum to the total of the same such amounts presented in the accompanying condensed consolidated statements of cash flows consisted of the following (in thousands):


		September 30, 2022		December 31, 2021			June 30, 2023		December 31, 2022
Cash	Cash	$	23,351	$	33,581	Cash	$	8,294	$	29,244
Cash equivalents	Cash equivalents	27,921		247,500		Cash equivalents	21,850		66,614
Cash and cash equivalents	Cash and cash equivalents	51,272		281,081		Cash and cash equivalents	30,144		95,858
Restricted cash included in prepaid expenses and other current assets	Restricted cash included in prepaid expenses and other current assets	1,859		—		Restricted cash included in prepaid expenses and other current assets	5,325		1,859
Restricted cash	Restricted cash	16,444		16,462		Restricted cash	13,147		16,448
Total cash, cash equivalents, and restricted cash presented in the statements of cash flows	Total cash, cash equivalents, and restricted cash presented in the statements of cash flows	$	69,575	$	297,543	Total cash, cash equivalents, and restricted cash presented in the statements of cash flows	$	48,616	$	114,165

Short-Term Investments

Short-term investments consisted of the following:


	June 30, 2023
	Amortized Cost		Unrealized Gain/(Loss)		Fair Value


U.S. Treasuries	$	34,874	$	—	$	34,874
U.S. Government Agencies	14,950		—		14,950
Total short-term investments	$	49,824	$	—	$	49,824


	December 31, 2022
	Amortized Cost		Unrealized Gain/(Loss)		Fair Value
Commercial Paper	$	59,684	$	—	$	59,684
Corporate Notes/Bonds	4,914		—		4,914
U.S. Treasuries	31,804		—		31,804
U.S. Government Agencies	5,882		—		5,882
Total short-term investments	$	102,284	$	—	$	102,284

The Company’s marketable debt securities have contractual maturities of less than one year, are classified as available-for-sale and are stated at fair value on the consolidated balance sheets based upon inputs other than quoted prices in active markets (Level 2 inputs). The Company did not record any unrealized gains or losses or recognize any gains or losses for three and six months ended June 30, 2023 and 2022. The Company also did not recognize any credit-related impairment losses during the three and six months ended June 30, 2023 and 2022 and had no ending allowance for credit losses as of June 30, 2023 and December 31, 2022. The amortized cost and fair value amounts above include accrued interest receivable of $0.2 million and $0.7 million as of June 30, 2023 and December 31, 2022, respectively.

Table of Contents

View, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Accounts Receivable, Net of Allowances

During the three and ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, the Company recorded ~~an immaterial change~~a $0.5 million increase in the allowance for credit losses. The Company regularly reviews accounts receivable for collectability and establishes or adjusts the allowance for credit losses as necessary using the specific identification method based on the available facts. The allowance for credit losses totaled ~~$0.7~~$1.5 million and ~~$0.7~~$1.1 million ~~at September~~as of June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively.

Inventories

Inventories consist of finished goods which are stated at the lower of cost or net realizable value. Costs are measured on a first-in, first out basis using standard cost, which approximates actual cost. Net realizable value is the estimated selling price of the Company’s products in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation. Inventories are written down to their net realizable value if they have become obsolete, have a cost basis in excess of expected net realizable value, or are in excess of expected demand. Once inventory is written down, its new value is maintained until it is sold, scrapped, or written down for further valuation losses. The valuation of inventories requires the Company to make judgments based on currently available information about the likely method of disposition and current and future product demand relative to the remaining product life. Inventory valuation losses are classified as cost of revenue in the condensed consolidated statements of comprehensive loss. The Company recorded inventory impairments of ~~$14.2~~$6.6 million and ~~$8.9~~$12.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, respectively.

Note Receivable

~~Table~~In June 2021, the Company entered into a promissory note with one of ~~Contents~~

~~View, Inc.~~

~~Notes~~its customers, pursuant to ~~Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

~~Prepaid expenses~~which the customer has drawn an aggregate principal amount of $10.0 million. The promissory note has a maturity date of May 1, 2026. The promissory note bears no interest during the period between the first advance to the customer and ~~other current assets~~

~~Prepaid expenses~~the thirty-first month following the first advance, with interest increasing to an annual rate of 3.5% thereafter. The Company recorded a $4.0 million impairment loss on the note receivable during the three and ~~other current assets consisted~~six months ended June 30, 2023, resulting from a change in the assessment of the ~~following (in thousands):~~

September 30, 2022 December 31, 2021
Current contract assets $ 14,634 $ 11,532
Short-term deposits 11,555 4,554
Prepaid expenses 5,347 5,478
Restricted cash 1,859 —
Other current assets 1,134 15
Total prepaid expenses and other current assets $ 34,529 $ 21,579
credit risk for the customer. As of June 30, 2023, $6.0 million related to the note receivable is recorded in other assets on the condensed consolidated balance sheet.

Impairment of Long-Lived Assets

The Company evaluates long-lived assets for impairment whenever events indicate that a potential impairment may have occurred. If such events arise, the Company will compare the carrying amount of the asset group comprising the long-lived assets to the estimated future undiscounted cash flows expected to be generated by the asset group. If the estimated aggregate undiscounted cash flows are less than the carrying amount of the asset group, an impairment charge is recorded as the amount by which the carrying amount of the asset group exceeds the fair value of the assets, as based on the expected discounted future cash flows attributable to those assets. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

The Company regularly reviews its long-lived assets for triggering events or other circumstances that could indicate impairment. As of ~~September~~December 31, 2022, management considered the continued operating losses when combined with the sustained decline in our market capitalization, to be a potential triggering event and therefore performed a quantitative impairment test of our long-lived assets as of December 31, 2022. Based on the results of this test, the Company concluded that the fair value of the asset group was substantially above its carrying value, and no impairment was recorded as of December 31, 2022. As of June 30, ~~2022,~~2023, no triggering events or other circumstances were identified. There were no impairments of long-lived assets during the ~~nine~~six months ended ~~September~~June 30, ~~2022 and 2021.~~2023.

~~Goodwill and Other Intangible Assets~~

~~From time to time,~~If the decline in the Company’s market capitalization continues, the Company ~~makes acquisitions of companies related~~is unable to ~~existing, complementary,~~obtain additional financing as discussed in Note 1, or ~~new markets. During fiscal year 2021,~~ the Company ~~completed two acquisitions, which were immaterial to its financial position, results~~identifies other events or circumstances indicating the carrying amount of ~~operations~~an asset or asset group may not be recoverable, this would require further testing of these assets and cash flows. There were no acquisitions completed in the nine months ended September 30, 2022. Acquisition-related costs are included in general and administrative expenses in the consolidated statements of comprehensive loss and were nil for the nine months ended September 30, 2022 and 2021.

~~There were no impairments of goodwill or intangible assets during the nine months ended September 30, 2022 and 2021. Impairment of goodwill or intangible assets~~it may result in ~~the future from significant changes in the manner~~an impairment of ~~use~~such assets.

Table of Contents

View, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the ~~acquired assets, negative industry or economic trends or significant underperformance relative to historical or projected operating results.~~following (in thousands):


	June 30, 2023		December 31, 2022

Warranty accrual (Note 5)	$	11,304	$	10,236
Contract loss accrual (Note 2)	11,553		12,848
Environmental settlement accrual (Note 6)	450		1,450
Lease liability	4,269		3,949
Subcontractor accrual	7,872		18,435
Other	16,802		25,492
Accrued expenses and other current liabilities	$	52,250	$	72,410

6.5.Product Warranties

~~The Company provides a standard assurance type~~Changes in warranty that its IGUs will be free from defects in materials and workmanship for generally 10 years from the date of delivery to customers. IGUs with sloped or laminated glass generally have a warranty of 5 or 10 years. Control systems associated with the sale of CSS typically have a 5-year warranty. As part of the Company’s Smart Building Platform contracts, the Company generally warrants that the workmanship of the sub-assemblies and installation of the Smart Building Platformliabilities are free from defects and in conformance with the contract documents for one year from completion. In resolving warranty claims, the Company’s standard warranty terms provide that the Company generally has the option of repairing, replacing or refunding the selling price of the covered product. The Company has not been requested to and has not provided any refunds, which would be treated as a reduction to revenue, as of September 30, 2022. The Company accrues for estimated claims of defective products at the time revenue is recognized based on historical warranty claims rates. The Company’s estimated costs for standard warranty claims are based on future estimated costs the Company expects to incur to replace the IGUs or control systems multiplied by the estimated IGU or control system warranty claims, respectively, based on warranty contractual terms and business practices. presented below (in thousands):



	June 30, 2023		December 31, 2022
Beginning balance	$	39,573	$	42,256
Accruals for warranties issued	1,086		1,626
Changes to estimates of volume and costs	—		2,004
Settlements made	(2,977)		(6,313)
Ending balance	$	37,682	$	39,573
Warranty liability, current, beginning balance	$	10,236	$	8,868
Warranty liability, noncurrent, beginning balance	$	29,337	$	33,388
Warranty liability, current, ending balance	$	11,304	$	10,236
Warranty liability, noncurrent, ending balance	$	26,377	$	29,337

The total warranty liability above included ~~$6.4~~$9.2 million and ~~$6.1~~$8.8 million as of ~~September~~June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively, related to ~~this~~the Company' standard assurance warranty.

~~In 2019, the Company identified~~The total warranty liability above also included $28.5 million and $30.8 million as of June 30, 2023 and December 31, 2022, respectively, related to certain IGUs with a quality issue ~~with~~identified during fiscal year 2019. The quality issue was specific to certain material purchased from one of ~~its~~the Company’s suppliers utilized in the manufacturing of certain ~~IGUs. The~~IGUs and the Company stopped using the affected materials upon identification of the quality issue in 2019. The Company has replaced and expects to continue to replace the affected IGUs for the remainder of the period covered

~~Table of Contents~~

~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

by the warranty. The Company developed a statistical model to analyze the risk of failure of the affected IGUs related to this quality issue and predict the potential number of future failures that may occur during the remaining warranty period, as well as the timing of the expected failures. Management judgment is necessary to determine the distribution fit and covariates utilized in the statistical model, as well as the relative tolerance to declare convergence. The statistical model considered the volume of units sold, the volume of unit failures, data patterns, and other characteristics associated with the failed IGUs as well as the IGUs that had not yet failed as of each financial reporting period. These characteristics include, but are not limited to, time to failure, manufacture date, location of installation, and environmental factors. Based on this analysis, the Company has recorded a specific warranty liability using the estimated number of affected IGUs expected to fail in the remaining warranty period and applying estimated costs the Company expects to incur to replace the IGUs based on warranty contractual terms and business practices. ~~The total warranty liability included $32.0 million and $36.2 million as of September 30, 2022 and December 31, 2021, respectively, related to these IGUs.~~

The Company monitors warranty obligations and may make adjustments to its warranty liabilities if actual costs of product repair and replacement are significantly higher or lower than estimated. Accruals for anticipated future warranty costs are recorded to cost of revenue in the condensed consolidated statements of comprehensive loss and included in other current liabilities and other liabilities on the condensed consolidated balance sheet. Warranty liabilities are based on estimates of failure rates and future costs to settle warranty claims that are updated periodically, taking into consideration inputs such as changes in the volume of claims compared with the Company’s historical experience, and changes in the cost of servicing warranty claims. The estimated cost includes the Company’s expectations regarding future total cost of replacement, as well as fixed cost absorption as production increases. The Company accounts for the effect of changes in estimates prospectively.

~~Changes in warranty liabilities are presented below (in thousands):~~

September 30, 2022 December 31, 2021
Beginning balance $ 42,256 $ 47,678
Accruals for warranties issued 1,290 1,551
Changes to estimates of volume and costs (116) 1,234
Settlements made (5,055) (8,207)
Ending balance $ 38,375 $ 42,256
Warranty liability, current, beginning balance $ 8,868 $ 8,864
Warranty liability, noncurrent, beginning balance $ 33,388 $ 38,814
Warranty liability, current, ending balance $ 8,883 $ 8,868
Warranty liability, noncurrent, ending balance $ 29,492 $ 33,388

During the three months ended September 30, 2022 and 2021, the Company recorded a charge to Cost of revenue of $0.3 million and $0.4 million, respectively, related to adjustments to the warranty liability. During the nine months ended September 30, 2022 and 2021, the Company recorded a charge to Cost of revenue of $1.2 million and $1.2 million, respectively, related to adjustments to the warranty liability.

Considering the uncertainty inherent in the failure analysis, including the actual timing of the failures and the number of defective IGUs, as well as uncertainty regarding future supply chain costs and production volumes that may impact the projected costs to replace defective IGUs in future years, it is reasonably possible that the amount of costs to be incurred to replace the defective IGUs could ultimately be materially different from the estimate. Unforeseen component failures or exceptional component performance can also result in changes to warranty costs. If actual warranty costs differ substantially from the Company’s estimates, revisions to the estimated warranty liability would be required, which could have a material adverse effect on the Company’s business, financial condition and results of operations.

7.6.Commitments and Contingencies

Indemnifications

From time to time, the Company enters into certain types of contracts that contingently require the Company to indemnify the Company's officers, directors, and employees for liabilities arising out of their employment relationship. Generally, a maximum obligation under these contracts is not explicitly stated.

2015

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Because the maximum amounts associated with these agreements are not explicitly stated, the overall maximum amount of the obligation cannot be reasonably estimated. The Company has not been required to make payments under these obligations, and no liabilities have been recorded for these obligations on the Company's condensed consolidated balance sheets.

Standby Letter of Credit

During the course of business, the Company’s bank issues standby letters of credit on behalf of the Company to certain vendors and other third parties of the Company. As of ~~September~~June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the total value of the standby letters of credit issued by the bank is ~~$17.0~~$14.8 million and ~~$16.5~~$15.7 million, respectively. No amounts have been drawn under the standby letters of ~~credit.~~

~~Commitments~~

Incredit as of June 2021, the Company entered into a promissory note with one of its customers, pursuant to which the customer may draw amounts in a maximum aggregate principal amount of $10.0 million. The amount of the draws is limited to the total amount incurred by subcontractors contracted by the Company in relation to the project. The promissory note is not a revolving facility, which means that outstanding amounts under the promissory note that are repaid cannot be re-borrowed. The promissory note has a maturity date of May 1, 2026. The promissory note bears no interest during the period between the first advance to the customer and the thirty-first month following the first advance, with interest increasing to an annual rate of 3.5% thereafter. As of September 30, ~~2022, the customer has a balance of $5.2 million drawn against the promissory note, which is recorded in other assets on the condensed consolidated balance sheet.~~2023.

Litigation and Environmental Settlements

In December 2014, the Company finalized the terms of a litigation settlement with a third party where the Company agreed to pay the other party a total of $32.0 million periodically over the next ten years. The Company recorded the present value of future payments as a liability and records interest expense, included in interest and other, net in the condensed consolidated statements of comprehensive loss, as it accretes the liability.

The balances of the litigation settlement liability are recorded in accrued expenses and other current liabilities and other liabilities, respectively, on the Company’s condensed consolidated balance sheets as follows (in thousands):


		September 30, 2022		December 31, 2021			June 30, 2023		December 31, 2022
Litigation settlement liability - current	Litigation settlement liability - current	$	3,000	$	—	Litigation settlement liability - current	$	3,000	$	3,000
Litigation settlement liability - non-current	Litigation settlement liability - non-current	5,550		7,834		Litigation settlement liability - non-current	3,155		5,794
Total litigation settlement liability	Total litigation settlement liability	$	8,550	$	7,834	Total litigation settlement liability	$	6,155	$	8,794

In September and August of 2021, the Mississippi Commission on Environmental Quality (“MCEQ”), Desoto County Regional Utility Authority (“DCRUA”) and the City of Olive Branch, Mississippi (“Olive Branch”), each issued notices and orders to the Company with respect to its discharges of water from its Olive Branch facility into the publicly owned treatment works (“POTW”) of DCRUA and Olive Branch without first obtaining a pretreatment permit. In August 2021, a Subpoena to Testify Before a Grand Jury was issued out of the United States District Court for the Northern District of Mississippi ~~(“Subpoena”~~(the “Subpoena”) to the Company requiring it to produce to the Environmental Protection Agency (“EPA”) various documents relating to environmental matters at its Olive Branch facility, including but not limited to hazardous waste records, air emissions records, storm water discharges records and wastewater disposal records. The Company has cooperated fully with each such notice, order, and the Subpoena.

On April 13, 2022, the Company and the United States Attorney’s Office for the United States District Court for the Northern District of Mississippi agreed in principle to the terms of a global settlement (the “Plea Agreement”) resolving the prospect of claims and charges against the Company relating to all prior discharges of water into the POTW of DCRUA and Olive Branch without first obtaining a pretreatment permit. The principal terms of the settlement are:

1.the Company pleading guilty to a single misdemeanor count for negligently discharging wastewater to a POTW without first obtaining a pretreatment permit in violation of 33 U.S.C. § 1319(c)(1)(A);

2.the Company paying a fine of $3.0 million over a three-year period in equal installments of $1.0 million to the federal government;

3.the Company paying a special assessment of $125 to the federal government pursuant to 18 U.S.C. § 3013(a)(1)(B);

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4.the Company entering a separate civil Agreed Order with ~~the~~ MCEQ that ~~requires the~~required payment of a separate civil penalty of $1.5 million;

5.the Company making a separate community service payment in the amount of $0.5 million to DCRUA, to be used for the sole purpose of expanding wastewater treatment capacity in DeSoto County, Mississippi, within 30 days of entering the Plea Agreement;

6.the Company implementing an environmental management system that conforms to ISO 14001:2015 standards or a similar environmental management system approved by the ~~United States Environmental Protection Agency,~~EPA, which ~~is expected to result~~resulted in approximately $0.3 million in consulting and personnel costs;

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7.the Company implementing agreed upon wastewater reduction plans, which is expected to result in approximately ~~$2.0~~$5.5 million in capital expenditures to install a wastewater treatment and recycling ~~system;~~system, of which $4.7 million has been incurred as of June 30, 2023;

8.the Company obtaining a pretreatment permit from ~~MDEQ,~~MCEQ, or entering an Agreed Order with MCEQ and operating in compliance with that Agreed Order until a permit can be obtained;

9.the Company obtaining wastewater discharge permits from DCRUA and Olive Branch, or entering into Consent/Compliance Order(s) or Agreement(s) with DCRUA and Olive Branch that are consistent with any Agreed Order entered with MCEQ and operating in compliance with such Consent/Compliance Order(s) or Agreement(s) until permits can be obtained; and

10.the Company agreeing to probation for three years.

The terms of the Plea Agreement are subject to the approval of the United States District Court for the Northern District of Mississippi. ~~View is in~~On November 7, 2022, the ~~process of coordinating~~Company finalized an Agreed Order with ~~MDEQ~~MCEQ as contemplated by the settlement terms. On November 16 and 17, 2022, Olive Branch and DCRUA, respectively, approved a joint Agreed Order with the Company, consistent with the settlement terms. The Company continues to coordinate with MCEQ and the local authorities with respect to the ~~civil orders and/or agreements~~obligations contemplated by the settlement terms, including obtaining a pretreatment permit from ~~MCEQ,~~the Mississippi Environmental Quality Permit Board, which has not been granted as of the date of this ~~Report. The Plea Agreement will be presented to the Court for approval following these efforts. The date for presentation of the Plea Agreement to the Court has not yet been determined.~~ Quarterly Report on Form 10-Q.

The Company ~~has~~previously recognized the $5.0 million of penalties it expects to incur in conjunction with this environmental settlement over the next three years.

The balances of the environmental settlement liability are recorded in accrued expenses and other current liabilities and other liabilities, respectively, on the Company’s condensed consolidated balance sheets as follows (in thousands):


		September 30, 2022		December 31, 2021			June 30, 2023		December 31, 2022
Environmental settlement liability - current	Environmental settlement liability - current	$	2,950	$	2,950	Environmental settlement liability - current	$	450	$	1,450
Environmental settlement liability - non-current	Environmental settlement liability - non-current	2,000		2,000		Environmental settlement liability - non-current	3,000		3,000
Total environmental settlement liability	Total environmental settlement liability	$	4,950	$	4,950	Total environmental settlement liability	$	3,450	$	4,450

Litigation

From time to time, the Company is subject to claims, litigation, internal or governmental investigations, including those related to labor and employment, contracts, intellectual property, environmental, regulatory compliance, commercial matters, and other related matters, some of which allege substantial monetary damages and claims. Some of these actions may be brought as class actions on behalf of a class or purported class of employees. The Company is also defendant in judicial and administrative proceedings involving matters incidental to the business. Legal expenses are expensed as incurred.

The Company accrues a charge when management determines that it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. When a loss is probable, the Company records an accrual based on the reasonably estimable loss or range of loss. When no point of loss is more likely than another, the Company records the lowest amount in the estimated range of loss and discloses the estimated range. The Company does not record liabilities for reasonably possible loss contingencies but does disclose a range of reasonably possible losses if they are material and the Company is able to estimate such a range. If the Company cannot provide a range of reasonably possible losses, the Company explains the factors that prevent it from determining such a range. The Company regularly evaluates current information available to it to determine whether an accrual should be established or adjusted. The ultimate outcome of legal proceedings involves judgments, estimates, and inherent uncertainties and cannot be predicted with certainty. Should the ultimate outcome of any legal matter be unfavorable, the Company's business, financial condition, results of operations, or cash flows could be materially and adversely affected. The Company may also incur substantial legal fees, which are expensed as incurred, in defending against legal claims.

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Securities Litigation

On August 18, 2021, plaintiff Asif Mehedi filed a putative securities class action in the United States District Court for the Northern District of California (~~Mehedi~~(Mehedi v. View, Inc. f/k/a CF Finance Acquisition Corp. II et al. (No. 5:21CV06374, N.D. Cal.)) alleging violations of the federal securities laws by the Company, Rao Mulpuri, and Vidul Prakash. On February 8, 2022, the Court appointed Stadium Capital LLC (“Stadium Capital”) lead plaintiff and denied the competing motion of Sweta

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Sonthalia. The Ninth Circuit Court of Appeals denied Ms. Sonthalia’s petition for a writ of mandamus to vacate the lead plaintiff order.

On July 15, 2022, Stadium Capital filed an amended complaint against View, Mulpuri, and Prakash; certain current and former View board members; Cantor Fitzgerald & Co. and related entities; officers and board members of CF ~~II;~~Finance Acquisition Corp. II (“CF II”); and PricewaterhouseCoopers LLP.The action iswas brought on behalf of a putative class consisting of (i) all persons or entities who purchased or otherwise acquired View and/or CF II securities between November 30, 2020 and May 10, 2022, inclusive; (ii) all persons or entities who were holders of CF II Class A common stock as of the January 27, 2021 record date that were entitled to vote to approve the merger between View and CF II; and (iii) all persons or entities who purchased or otherwise acquired View securities pursuant or traceable to the Form S-4 Registration Statement filed by CF II on December 23, 2020.The amended complaint ~~asserts~~asserted claims under Sections 10(b) (and Rule 10b-5 thereunder), 14(a) (and Rule 14a-9 thereunder), and 20(a) of the Securities Exchange Act and Sections 11, 12, and 15 of the Securities Act.

The amended complaint ~~alleges~~alleged that certain defendants failed to disclose to investors that the Company’s warranty-related obligations and associated cost of revenue were materially false and misleading because they excluded expenses the Company incurred and expected to incur due to significant quality issues.The amended complaint ~~alleges~~alleged that certain defendants’ positive statements about the Company were false and materially misleading as a result, and that such statements caused the price of the Company’s stock to be inflated.The amended complaint ~~alleges~~alleged that class members were damaged when the price of the Company’s stock declined on the trading day following (1) August 16, 2021, when the Company announced an independent investigation concerning the adequacy of the Company’s previously disclosed warranty accrual, and (2) May 10, 2022, when the Company stated that management anticipated that it would be disclosing substantial doubt about the Company’s ability to continue as a going concern and that the Company’s cash position was $200.5 million at the end of Q1 2022.The amended complaint ~~seeks~~sought unspecified compensatory damages and costs, including attorneys’ fees.

Defendants filed motions to dismiss on October 6, 2022. ~~Pursuant to~~The motions were heard by the court on April 20, 2023. On May 20, 2023, the court issued a ~~stipulated schedule, Stadium Capital will file its opposition(s) to the motions by November 14, 2022; and Defendants will file any replies in support of~~written order granting the motions to dismiss with leave to amend. Any amended complaint must be filed by ~~December 14, 2022. The motions are set for hearing on April 20,~~August 21, 2023.

Given the ~~early stage of this matter,~~possibility that the plaintiff may amend its complaint, the Company cannot reasonably estimate the possible loss (or range of loss), if any, at this time; therefore, a liability has not been recorded as of ~~September~~June 30, ~~2022.~~2023.

Derivative Litigation

On December 6, 2021, a purported Company shareholder, Matthew Jacobson, filed a verified stockholder derivative complaint (nominally on behalf of the Company) against Rao Mulpuri, Nigel Gormly, Harold Hughes, Tom Leppert, Toby Cosgrove, Lisa Picard, Julie Larson-Green, and Vidul Prakash (~~Jacobson~~(Jacobson v. Mulpuri, et al. ~~(No.~~(No. 1:21CV01719, D. Del.)). On May 24, 2022, plaintiff and purported Company ~~stockholder~~shareholder Anil Damidi filed a verified stockholder derivative complaint (nominally on behalf of the Company) against the same defendants as in the Jacobson complaint: Mr. Mulpuri, Mr. Gormly, Mr. Hughes, Mr. Leppert, Mr. Cosgrove, Ms. Picard, Ms. Larson-Green, and Mr. Prakash. On July 26, 2022, plaintiff and purported Company stockholder James Monteleone filed a verified stockholder derivative complaint (nominally on behalf of the Company) against the same defendants as in the Jacobson and Damidi complaints: Mr. Mulpuri, Mr. Gormly, Mr. Hughes, Mr. Leppert, Mr. Cosgrove, Ms. Picard, Ms. Larson-Green, and Mr. Prakash.

On September 8, 2022, the Jacobson,, Damidi,, and Monteleone cases were assigned to Judge Gregory Williams. On September 30, 2022, Judge Williams entered the parties’ stipulation to (1) consolidate the three actions into In re View, Inc. Derivative Litigation,, C.A. No, 21-1719-GBW (Consolidated), (2) appoint co-lead counsel for plaintiffs, and (3) stay all proceedings in the consolidated action until the Mehedi class action is dismissed in its entirety, with prejudice, and all appeals related thereto have been exhausted, or is resolved by settlement, or the motions to dismiss in the Mehedi class actionare denied. Any party may request that the Court lift the stay upon good cause shown and bringing the matter to the Court’s attention.

The stipulation deems the Damidi complaint to be the operative complaint in the consolidated case until any amended complaint is filed. The Damidi complaint asserts claims for violation of Sections 10(b) and 21D of the Exchange Act, breach of fiduciary duty, aiding and abetting breach of fiduciary duty, unjust enrichment, and waste of corporate assets. The Damidi complaint

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seeks unspecified money damages, restitution, punitive damages, and costs (including attorneys’ fees and accountants’ and experts’ fees, costs, and expenses). The Damidi complaint alleges that the defendants failed to prevent the Company from making false statements regarding the Company’s business results and prospects and that the Company has been harmed by incurring legal fees and potential liability in investigations and lawsuits.

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On May 9, 2023, plaintiff and purported Company shareholder Alexandre Roberts filed a verified stockholder derivative complaint (nominally on behalf of the Company) against Rao Mulpuri, Vidul Prakash, Toby Cosgrove, Lisa Picard, and Nigel Gormly (Roberts v. Mulpuri, et al. (No. 5:23-cv-02248, N.D. Cal.)). The complaint asserts claims for breach of fiduciary duty, unjust enrichment, waste of corporate assets, and contribution under Section 10(b) and/or Section 20(a) of the Exchange Act. The complaint seeks unspecified money damages, restitution, punitive damages, and costs (including attorneys’ fees and experts’ fees, costs, and expenses). The Roberts complaint alleges that the defendants failed to prevent the Company from making false statements regarding the Company’s business results and prospects and that the Company has been harmed by incurring legal fees and potential liability in lawsuits.

On August 1, 2023, the judge in the Mehedi case ordered that the Roberts case should be related to the Mehedi case and ordered that the Roberts case should be reassigned to the Mehedi judge.

Given the early stage of this matter, the Company cannot reasonably estimate the possible loss (or range of loss), if any, at this time; therefore, a liability has not been recorded as of ~~September~~June 30, ~~2022.~~2023.

Government Investigations

On November 9, 2021, the Company announced that it had voluntarily reported to the SEC that the ~~Audit Committee~~audit committee of the Company’s ~~Board~~board of ~~Directors~~directors was conducting an independent, internal investigation into the adequacy of the Company’s previously reported warranty accrual. In January 2022, the Company was informed that the SEC iswas conducting a formal investigation of this matter. ~~The Company has cooperated with the SEC’s investigation and intends to continue doing so.~~

In June 2022, the U.S. Attorney’s Office for the Southern District of New York requested information related to this matter.The Company ~~has~~ cooperated with the SEC’s investigation and the U.S. Attorney’s ~~Office~~information request. On July 3, 2023, the SEC announced a settlement with the Company resolving the previously disclosed investigation arising from the Company’s restated warranty-related accruals in its financial statements. In light of the Company’s self-reporting, prompt remediation and cooperation, the SEC determined not to impose a civil penalty on the Company and there are no ongoing undertakings in connection with ~~these requests and intends to continue doing so.~~

~~Given~~ the ~~early stage of these matters, the Company cannot reasonably estimate the possible loss (or range of loss), if any, at this time; therefore, a liability has not been recorded as of September 30, 2022.~~settlement.

8.7.Debt

Debt outstanding consisted of the following (in thousands):


		Interest Rate	September 30, 2022		December 31, 2021			June 30, 2023		December 31, 2022
Term loan, due June 30, 2032		0%	$	14,695	$	15,430
Convertible Notes, net of debt issuance costs							Convertible Notes, net of debt issuance costs	$	196,586	$	206,347
Term loan							Term loan	13,960		13,960

Total debt	Total debt		14,695		15,430		Total debt	210,546		220,307
Debt, current	Debt, current		1,470		1,470		Debt, current	2,205		1,470
Debt, non-current	Debt, non-current		$	13,225	$	13,960	Debt, non-current	$	208,341	$	218,837

Principal payments on all debt outstanding as of ~~September~~June 30, ~~2022~~2023 are estimated as follows (in thousands):


Year Ending December 31,	Year Ending December 31,	Total		Year Ending December 31,	Total
2022 (remaining three months)		$	735
2023		1,470
2023 (remaining six months)				2023 (remaining six months)	$	1,470
2024	2024	1,470		2024	1,470
2025	2025	1,470		2025	1,470
2026	2026	1,470		2026	1,470
2027				2027	198,055
Thereafter	Thereafter	8,080		Thereafter	6,611
Total	Total	$	14,695	Total	$	210,546

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Convertible Notes

The following tables present the Company’s convertible debt outstanding (in thousands):


	June 30, 2023
	Gross amount		Debt discount and issuance costs		Carrying amount		Estimated fair value
Convertible Notes	$	201,607	$	(5,021)	$	196,586	$	105,885


	December 31, 2022
	Gross amount		Debt discount and issuance costs		Carrying amount		Estimated fair value
Convertible Notes	$	212,308	$	(5,961)	$	206,347	$	199,163

The following table presents the Company’s interest expense related to convertible debt (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Contractual interest expense	$	4,536	$	—	$	8,873	$	—
Amortization of debt discount and issuance costs	298		—		424		—
Total interest expense	$	4,834	$	—	$	9,297	$	—

In October 2022, the Company completed the sale of $200.0 million aggregate principal amount of the Company’s 6.00% / 9.00% Convertible Senior PIK Toggle Notes (the “Initial Notes”), with the option to sell an additional $40.0 million of Notes to the Purchasers (as defined in the indenture governing the Convertible Notes). In December 2022, the Company received notices from certain Purchasers that had elected to exercise their respective options to purchase an aggregate additional $12.3 million of Convertible Notes (the “Additional Notes”). Such Additional Notes were issued in December 2022. The Initial Notes and the Additional Notes, which will be collectively referred to as the Convertible Notes, will mature on October 1, 2027. The Convertible Notes were sold in a private placement in reliance on the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”) provided by Section 4(a)(2) of the Securities Act.

The net proceeds from the sale of the Convertible Notes were approximately $206.3 million after deducting fees and offering expenses. The debt discount and issuance costs, net of accumulated amortization, are reported as a direct deduction from the face amount of the Convertible Notes. The Company expects to use the net proceeds for general corporate purposes.

The Convertible Notes are convertible, based on the applicable conversion rate, into cash, shares of the Company’s common stock or a combination thereof, at the Company’s election. The initial conversion rate was 12.46106 shares per $1,000.00 principal amount of the Convertible Notes, subject to customary anti-dilution adjustment in certain circumstances, which represented an initial conversion price of approximately $80.25 per share.

The Convertible Notes will be convertible at the option of the holders at any time until the close of business on the second scheduled trading day immediately preceding the maturity date of the Convertible Notes. In connection with the issuance of the Convertible Notes, the Company entered into letter agreements with certain Purchasers (the “Blocker Agreements”). The Blocker Agreements provide, among other things, that the Convertible Notes held by the entities affiliated with certain holders (each, a “Blocker Party”), shall not be converted to the extent that such conversion would cause a Blocker Party to beneficially own more than a specified threshold percentage (as may be increased or decreased by the applicable Blocker Party upon 61 days’ written notice) of the Class A common stock, par value $0.0001 per share, of the Company outstanding immediately following such conversion.

The Company may redeem the Convertible Notes in whole or in part, at its option, on or after October 1, 2025, and prior to the 41st scheduled trading day immediately preceding the maturity date, for cash at the applicable redemption price if the last reported sale price of the Company’s common stock has been at least 150% of the conversion price then in effect for at least 20

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trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides the applicable redemption notice. The redemption price will be equal to the aggregate principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. In addition, a holder may elect to convert its Convertible Notes during any such redemption period, in which case the applicable conversion rate may be increased in certain circumstances if the Convertible Notes are converted after they are called for redemption.

Additionally, if the Company undergoes a fundamental change transaction (each such term as defined in the indenture governing the Convertible Notes), subject to certain conditions, holders may require the Company to purchase for cash all or any portion of their Convertible Notes. The fundamental change repurchase price will be 100% of the capitalized principal amount of the Convertible Notes, plus any accrued and unpaid interest to, but excluding, the repurchase date.

The indenture governing the Convertible Notes contains customary terms and covenants, including certain events of default in which case either the trustee or the holders of at least 25% of the aggregate principal amount of the outstanding Convertible Notes may declare 100% of the principal of, and accrued and unpaid interest, if any, on, all the Convertible Notes to be due and payable immediately.

As of June 30, 2023, the effective interest rate on the Convertible Notes was 9.80%. Amortization of debt discount and issuance costs is reported as a component of interest expenses and is computed using the straight-line method over the term of the Convertible Notes, which approximates the effective interest method. During the six months ended June 30, 2023, the Company elected the PIK Interest option and accrued interest of $7.3 million was added to the principal balance of the Convertible Notes.

On January 12, 2023, holders of $18.0 million in aggregate principal amount of the Convertible Notes exercised their right to convert their Convertible Notes into shares at the conversion price of $64.20 per share. As a result, the Company issued 280,373 shares of its Class A common stock, par value $0.0001 per share.

Term Loan

On November 22, 2010, the Company entered into a debt arrangement with a lender, in an amount of $40.0 million ~~(“Term~~(the “Term Loan”), for the purpose of financing equipment and tenant improvements at its manufacturing facility in Olive Branch, Mississippi. Pursuant to the original terms, the loan provides for interest-free debt to be repaid in semi-annual payments due on June 30 and December 31 each year. The loan was originally being paid over 24 semi-annual installments through June 30, 2024.

On October 22, 2020, the Company entered into an amended and restated debt arrangement with the lender. The amended and restated debt arrangement temporarily suspended the payments. Starting June 30, 2022, the Company is required to make semi-annual payments of $0.7 million due on June 30 and December 31 each year through June 30, 2032.

The term loan agreement required the Company to invest certain amounts in land, building and equipment and create a certain number of jobs. The term loan agreement, as amended, also includes a covenant for audited consolidated financial statements to

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be delivered to the lender within 210 days of the Company’s fiscal year end. As of ~~September~~June 30, ~~2022,~~2023, the Company was in compliance with these covenants.

~~Revolving Debt Facility~~

In October 2019, the Company entered into a secured revolving debt facility pursuant to which the Company may draw amounts in a maximum aggregate principal amount of $200.0 million until January 3, 2020 and $250.0 million after such date, for the purpose of paying payables and other corporate obligations. In October 2019, the Company drew a principal amount of $150.0 million under the facility with weekly maturity dates ranging from 8 days to 364 days. In May 2020, the Company drew the remaining principal amount of $100.0 million available under the facility, which was repayable on May 1, 2021. The facility's original expiration was October 22, 2023, at which time all drawn amounts were to be repaid in full. The interest rate applicable to amounts outstanding under the facility was LIBOR, plus 9.05%. As security for the payment and performance of all obligations under the facility, the Company granted the finance provider a security interest in substantially all of the Company's assets.

Under the original agreement, repaid principal amounts became immediately available to be redrawn under the facility with maturity dates of one year through October 23, 2022. In December 2020, the Company entered into an amendment to replace thirteen weekly draws of approximately $2.9 million each, aggregating to $37.5 million in principal amount, with four notes of approximately $9.4 million each, aggregating to $37.5 million in principal amount.

On March 8, 2021, upon Closing, the facility was repaid in full in the amount of $276.8 million, including accrued interest and future interest through maturity of the notes of $26.8 million prior to the expiration of the limited waiver from the finance provider. Upon repayment of its obligation, the Company recorded a debt extinguishment loss of $10.0 million, and the facility was terminated.

9.8.Stockholders’ Equity

Common Stock

On March 9, 2021, the Company’s common stock and warrants began trading on the Nasdaq Global Select Market under the ticker symbols “VIEW” and “VIEWW,” respectively. Pursuant to the Company’s certificate of incorporation, the Company is authorized to issue 600,000,000 shares of common stock with a par value of $0.0001 per share. As of ~~September~~June 30, ~~2022,~~2023, the Company had ~~221,390,799~~4,032,626 shares of common stock issued and outstanding.

Preferred Stock

Pursuant to the Company’s certificate of incorporation, the Company is authorized to issue 1,000,000 shares of preferred stock having a par value of $0.0001 per share (“View Inc. Preferred Stock”). The Company’s board of directors has the authority to issue View, Inc. Preferred Stock and to determine the rights, preferences, privileges, and restrictions, including voting rights, of those shares. As of ~~September~~June 30, ~~2022,~~2023, no shares of View, Inc. Preferred Stock were issued and outstanding.

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Net Share Settlement of Equity Awards

During the three ~~and nine~~ months ended ~~September~~June 30, ~~2022,~~2023, the Company withheld ~~1,887,172~~13,423 shares with a fair value of ~~$3.1~~$0.3 million in satisfaction of tax withholding obligations relating to the vesting of restricted share units. ~~The~~During the six months ended June 30, 2023, the Company withheld 35,354 shares ~~were~~with a fair value of $1.3 million in satisfaction of tax withholding obligations relating to the vesting of restricted share units. No restricted share units vested during the three and six months ended June 30, 2022. Shares withheld in satisfaction of tax withholding obligations are retired upon repurchase and returned to the unissued authorized capital of the Company. As of ~~September~~June 30, ~~2022,~~2023, no shares of Treasury Stock were issued and outstanding.

Convertible Note Conversion

As discussed in Note 7, on January 12, 2023, holders of $18.0 million in aggregate principal amount of the Convertible Notes exercised their right to convert their Convertible Notes into shares at the conversion price of $64.20 per share. As a result, the Company issued 280,373 shares of its Class A common stock, par value $0.0001 per share. No holders of the Convertible Notes exercised their right to convert their Convertible Notes into shares during the three months ended June 30, 2023.

Dividend

Common stock is entitled to dividends when and if declared by the Company’s board of directors, subject to the rights of all classes of stock outstanding having priority rights to dividends. The Company has not paid any cash dividends on common stock to date. The Company may retain future earnings, if any, for the further development and expansion of its business and has no current plans to pay cash dividends for the foreseeable future. Any future determination to pay dividends will be made at the discretion of the Company’s board of directors and will depend on, among other things, the Company’s financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as the Company’s board of directors may deem relevant.

Common Stock Purchase Agreement

On August 8, 2022, the Company entered into ~~the~~ Purchase Agreements with each of CF Principal Investments LLC, a Delaware limited liability company (“Cantor”), and YA II PN, Ltd., a Cayman Islands exempted company (“Yorkville,” and

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~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

together with Cantor, the “Investors”), relating to a committed equity facility (the “Facility”). Under the terms of the Purchase Agreements, the Company will have the right, from time to time and at its option, to sell to the Investors up to $100.0 million, in the aggregate, of the Company’s common stock (“View Shares”), subject to certain conditions and limitations set forth in the Purchase Agreements. As of ~~September~~June 30, ~~2022,~~2023, the Investors have purchased zero ~~shares~~View Shares under the Purchase Agreements.

Sales of ~~the~~ View Shares under the Purchase Agreements, and the timing of any sales, will be determined by the Company from time to time at its sole discretion and will depend on a variety of factors, including, among other things, market conditions, the trading price of the Company’s common stock and determinations by the Company regarding the use of proceeds from such sales. The net proceeds from any sales under the Purchase Agreements will depend on the frequency with, and prices at which ~~the~~ View Shares are sold to the Investors. The Company expects to use the proceeds from any sales under the Purchase Agreements for working capital and general corporate purposes.

Upon the initial satisfaction of the conditions to the Investors’ obligations to purchase View Shares set forth in the Purchase Agreements (the “Commencement”), including that a registration statement (the “Resale Registration Statement”) registering the resale of ~~the~~ View Shares under the Securities Act, ~~of 1933, as amended (the “Securities Act”),~~ is declared effective by the SEC and the Investors are permitted to utilize the prospectus therein to resell all of the ~~shares~~View Shares included in such prospectus, the Company will have the right, but not the obligation, from time to time at its sole discretion until the earliest of (i) the first day of the month next following the date that is 36-months after the effective date of the Resale Registration Statement, (ii) the date on which the Investors shall have purchased, in the aggregate, $100.0 million worth of ~~shares~~View Shares pursuant to the Purchase Agreements, (iii) the date on which the Company’s common stock shall have failed to be listed or quoted on The Nasdaq Global Market or an alternative market and (iv) the date on which the Company commences a voluntary bankruptcy case or any person commences a proceeding against the Company, a custodian is appointed for the Company or for all or substantially all of its property or the Company makes a general assignment for the benefit of its creditors, to direct the Investors to purchase View Shares as set forth in the Purchase Agreements, by delivering written notice to Cantor or Yorkville prior to 9:00 AM, Eastern Time, on any trading day, subject to maximum amount as set forth in the Purchase Agreements for each such trading day. The purchase price of ~~the~~ View Shares that the Company elects to sell pursuant to the Purchase Agreements will be 97% of the volume weighted average price of the Company’s common stock during the applicable purchase date, subject to adjustment if the Company delivers a purchase notice for a purchase in excess of 20% of the total volume of the Company’s common stock traded during the applicable purchase period.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company will not sell, and the Investors will not purchase, any View Shares pursuant to the Purchase Agreements, if the aggregate number of View Shares issued pursuant to the Purchase Agreements would exceed 19.99% of the voting power or number of shares of the Company’s common stock issued and outstanding immediately prior to the execution of the Purchase Agreements), subject to reduction as described in the Purchase Agreements, unless the Company obtains approval of its stockholders for the sale of View Shares in excess of such amount. In addition, the Company will not sell, and Cantor and Yorkville will not purchase, any View Shares pursuant to the Purchase Agreements, which, when aggregated with all other shares of the Company’s common stock then beneficially owned by such Investor and its affiliates, would result in, in the case of Cantor, the beneficial ownership by Cantor and its affiliates of more than 9.99% of the Company’s outstanding voting power or shares of the Company’s common stock, or in the case of Yorkville and its affiliates, would result in the beneficial ownership by Yorkville and its affiliates of more than 4.99% of the Company’s outstanding voting power or shares of the Company’s common stock.

On the date of the Commencement, the Company will issue to Cantor shares of the Company’s common stock with a value of $1.3 million (the “Commitment Fee”) as of the trading day prior to the filing of the Resale Registration Statement as consideration for its irrevocable commitment to purchase ~~the~~ View Shares upon the terms and subject to the satisfaction of the conditions set forth in its respective Purchase Agreement. In addition, pursuant to the Purchase Agreements, the Company agreed to reimburse Cantor for certain of its expenses. The Company also entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with the Investors, pursuant to which the Company has agreed to register the resale of ~~the~~ View Shares and the shares constituting the Commitment Fee. The Purchase Agreements and the Registration Rights Agreement contain customary representations, warranties, conditions, and indemnification obligations by each party. The Purchase Agreements also provide that the representations and warranties of the Company (a) that are not qualified by “materiality” or “Material Adverse Effect” (as defined in the Purchase Agreements) must be true and correct in all material respects as of the date of the Commencement, except to the extent such representations and warranties are as of another date, in which case such representations and warranties must be true and correct in all material respects as of such other date, and (b) that are qualified by “materiality” or “Material Adverse Effect” (as defined in the Purchase Agreements) must be true and correct as of the date of the Commencement, except to the extent such representations and warranties are as of another date, in

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~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

which case such representations and warranties must be true and correct as of such other date. The Purchase Agreements also provide that the representations and warranties of the Company must be true and correct as described in (a) and (b) above as of a date within three trading days following each time the Company files (i) an Annual Report on Form 10-K and certain Annual Reports on Form 10-K/A, (ii) a Quarterly Report on Form 10-Q, (iii) certain Current Reports on Form 8-K containing amended financial information and (iv) the Resale Registration Statement, any New Registration Statement (as defined in the Purchase Agreements) or any supplement or post-effective amendment thereto, subject to certain exceptions and in any event not more than once per calendar quarter. The representations, warranties and covenants contained in the Purchase Agreements and the Registration Rights Agreement were made only for purposes of the Purchase Agreements and the Registration Rights Agreement and as of specific dates, are solely for the benefit of the parties to such agreements and are subject to certain important limitations.

The Company has the right to terminate the Purchase Agreements at any time after the date of the Commencement, at no cost or penalty, upon three trading days’ prior written notice. The Investors have the right to terminate the Purchase Agreements upon three trading days’ prior written notice if, among other things, a Material Adverse Effect (as defined in the Purchase Agreements) has occurred and is continuing.

~~10.~~9.Stock Warrants

Public and Private Warrants

~~Prior to~~Each of the ~~Merger, CF II issued 366,666~~Company’s Public and Private Warrants ~~and 16,666,637 Public Warrants. Each whole warrant~~ entitles the holder to purchase one share of the Company’s common stock at a price of ~~$11.50~~$690.00 per share, subject to adjustments. The Warrants became exercisable on August 26, 2021. The Public Warrants and Private Warrants will expire five years after ~~the Closing~~March 8, 2021 and five years after August 26, 2020, respectively.

The Company may redeem the outstanding warrants, in whole and not in part, upon a minimum of thirty days’ prior written notice of redemption (“Redemption Period”). For purposes of the redemption, “Reference Value” shall mean the last reported sales price of the Company’s common stock for any ~~twenty~~ ~~trading days within the~~ ~~thirty~~ ~~trading-day period ending on the third trading day prior to the date on which notice of the redemption is given.~~

The Company may redeem the outstanding Public Warrants for cash at a price of $0.01 per warrant if the Reference Value equals or exceeds $18.00 per share. The warrant holders have the right to exercise their outstanding warrants prior to the scheduled redemption date during the Redemption Period at $11.50 per share. If the Company calls the Public Warrants for redemption, the Company will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement.

The Private Warrants are identical to the Public Warrants except that the Private Warrants were not transferable, assignable, or salable until April 7, 2021. Additionally, the Private Warrants are exercisable on a cashless basis and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, then such warrants will be redeemable by the Company and exercisable by the warrant holders on the same basis as the Public Warrants.

As of ~~September~~June 30, ~~2022,~~2023, there were ~~366,666~~6,111 Private Warrants and ~~16,666,637~~277,777 Public Warrants outstanding, and no Warrants had been exercised.

~~Other Warrants~~Strategic Agreement & RXR Warrant Agreements

~~Legacy View also~~On October 25, 2022, the Company appointed RXR FP Services LLC (“RXR FP”) to render strategic planning and consulting services to the Company and issued ~~redeemable convertible preferred stock and common stock~~ warrants to ~~various service providers, lenders, investors, at various points~~RXR FP (the “RXR Warrants”) to purchase, in ~~time, which were subsequently converted to~~ the ~~common stock warrants~~aggregate, 158,518 shares of the ~~Company. Upon consummation of the Merger, each Legacy View warrant that was outstanding was assumed by CF II and converted into a~~Company’s common stock warrant exercisable for common stock equal to the product (rounded down to the nearest whole number) of (a) the number of shares of Legacy View capital stock subject to the Legacy View warrant immediately prior to the Merger multiplied by (b) the Exchange Ratio. Such warrants have a per share exercise price equal to the quotient (rounded up to the nearest whole cent) obtained by dividing (i) the exercise price per share of Legacy View capital stock subject to the Legacy View warrant immediately prior to the Merger by (ii) the Exchange Ratio, and, except as specifically provided in the Merger Agreement, each warrant continues to be governed by the same terms and conditions (including vesting and exercisability terms) as were applicable to the corresponding former Legacy View warrant immediately prior to the Merger. Prior to the merger, the redeemable convertible preferred stock warrants were classified as liabilities on the condensed consolidated balancestock. The RXR Warrants will expire ten years after October 25, 2022.

2723

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

~~sheets. See~~ ~~Note 4~~ ~~for a reconciliation~~A portion of the ~~beginning~~RXR Warrants is accounted for as consideration payable to a customer and ~~ending balances~~a portion of the RXR Warrants is accounted for as non-employee stock compensation. The total grant date fair value of the ~~level 3 financial liabilities measured~~RXR Warrants was $9.2 million, which was accounted for as an upfront payment to RXR FP as their right to receive the RXR Warrants was not contingent on satisfying any vesting conditions. The Company allocated the grant date fair value between consideration payable to a customer and non-employee stock compensation based on the estimated relative fair value of services to be provided by RXR FP. The portion of the RXR Warrants allocated as consideration payable to a customer is accounted for as a reduction to the contract price for contracts with RXR Realty and therefore a reduction to revenue on such contracts. The portion of the RXR Warrants allocated as non-employee stock compensation is accounted for as marketing expense and expensed as incurred. As of June 30, 2023, there were 158,518 RXR Warrants outstanding, and no RXR Warrants had been exercised.

Other Warrants

The Company previously issued common stock warrants to various service providers, lenders, investors, at ~~fair value.~~various points in time (the “Legacy Warrants”) that are exercisable at various exercise prices and expire at various points in time. During the three months ended June 30, 2023, none of the Legacy Warrants expired. During the six months ended June 30, 2023, 3,471 of the Legacy Warrants expired.

On December 1, 2021, in connection with the WorxWell acquisition, the Company issued ~~1,000,000~~16,666 common stock warrants to the ~~seller.~~seller (the “WorxWell Warrants”). As of June 30, 2023, no WorxWell Warrants had been exercised.

The following table summarizes the outstanding common stock warrants:


Warrant issue date	Warrant issue date	Types of shares issued	Number of Warrants September 30, 2022 (As converted)	Number of Warrants December 31, 2021 (As converted)	Exercise Price Per Warrant (As converted)		Expiry Date	Warrant issue date	Types of shares issued	Number of Warrants June 30, 2023	Number of Warrants December 31, 2022	Exercise Price Per Warrant		Expiry Date
August 2010 - June 2011	August 2010 - June 2011	Common stock (previously Series B redeemable convertible preferred stock)	46,498	46,498	$	15.49	March 2023	August 2010 - June 2011	Common stock	—	774	$	929.40	March 2023
August 2011 - January 2012	August 2011 - January 2012	Common stock (previously Series C redeemable convertible preferred stock)	53,256	53,256	18.78		March 2023	August 2011 - January 2012	Common stock	—	887	1,126.80		March 2023
August 2012	August 2012	Common stock (previously Series D redeemable convertible preferred stock)	45,388	45,388	21.60		March 2023	August 2012	Common stock	—	756	1,296.00		March 2023
December 2013	December 2013	Common stock (previously Series E redeemable convertible preferred stock)	63,296	63,296	25.91		March 2023	December 2013	Common stock	—	1,054	1,554.60		March 2023
April 2015 - April 2016		Common stock (previously Series F redeemable convertible preferred stock)	38,749	45,207	38.71		Through December 2022

April 2016 - November 2018	April 2016 - November 2018	Common stock (previously Series H redeemable convertible preferred stock)	1,135,391	1,135,391	18.93		Through November 2028	April 2016 - November 2018	Common stock	18,923	18,293	1,135.80		Through November 2028
March 2017	March 2017	Common stock (previously Series H redeemable convertible preferred stock)	1,849,431	1,849,431	12.91		March 2027	March 2017	Common stock	30,823	30,823	774.60		March 2027
March 2014	March 2014	Common stock	2,324	2,324	9.47		August 2023	March 2014	Common stock	38	38	568.20		August 2023
August 2015		Common stock	12,916	12,916	11.62		December 2022

December 2018	December 2018	Common stock	24,910	24,910	9.04		December 2028	December 2018	Common stock	415	415	542.40		December 2028
August 2020	August 2020	Common stock (Private Warrants)	366,666	366,666	11.50		Through March 2026	August 2020	Common stock (Private Warrants)	6,111	6,111	690.00		Through March 2026
August 2020	August 2020	Common stock (Public Warrants)	16,666,637	16,666,637	11.50		Through March 2026	August 2020	Common stock (Public Warrants)	277,777	277,777	690.00		Through March 2026
December 2021	December 2021	Common stock (in connection with the WorxWell acquisition)	1,000,000	1,000,000	$	10.00	December 2031	December 2021	Common stock (in connection with the WorxWell acquisition)	16,666	16,666	600.00		December 2031
October 2022								October 2022	Common stock (in connection with the Strategic Agreement with RXR FP)	158,518	158,518	$	0.60	October 2032
		Total stock warrants	21,305,462	21,311,920					Total stock warrants	509,271	512,112

~~11.~~10.Stock-Based Compensation

~~2018 Plan~~

~~Legacy View’s 2018 Amended and Restated~~2021 Equity Incentive Plan (formerly the 2009 Equity Incentive Plan), effective November 21, 2018 (the “2018 Plan”), allowed Legacy View to grant incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock awards and restricted stock units to eligible employees, directors, and consultants of Legacy View and any parent or subsidiary of Legacy View. In connection with the Closing of the Merger, the 2018 Plan was terminated, the remaining unallocated share reserve under the 2018 Plan was cancelled and no new awards will be granted under the 2018 Plan. 24,657,302 options (as converted, due to retroactive application of reverse recapitalization) outstanding under the 2018 Plan at Closing were assumed by the Company under the 2021 Plan (defined below).

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~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

The options assumed under the 2021 Plan (defined below) generally vest 20% upon completion of one year of service and 1/60 per month thereafter or vest 25% upon completion of one year of service and 1/48 per month thereafter and generally expire 10 years from the date of grant.

~~2021 Plan~~

~~In connection with the Closing of the Merger, the~~ Company adopted the 2021 Equity Incentive Plan (the “2021 Plan”) on March 8, 2021, under which ~~58,631,907~~977,198 shares of common stock were initially reserved for issuance. The 2021 Plan permits the grant of incentive stock options (“Options”), nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs)”, and stock bonus awards. As of ~~September~~June 30, ~~2022,~~2023, the Company had ~~22,834,641~~158,367 shares of common stock reserved for future issuance of equity awards to employees, officers, directors, or consultants under the 2021 Plan.

~~Pursuant~~

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

Options

The Company assumed approximately 410,955 options outstanding under a previous equity incentive plan under the ~~terms of the Agreement and Plan of Merger, at the Closing of the Merger~~2021 Plan. In addition, on March 8, 2021, the Company granted ~~12,500,000 Officer RSUs (the “Officer RSUs”) for shares of Class A Common Stock of the Company and 5,000,000~~83,333 options to purchase Class A ~~Common Stock~~common stock of the Company ~~(“Officer~~(the “Officer Options”) to View’s executive officers. The Officer Options time vest over a four-year period with 25% to vest on the twelve-month anniversary of ~~the Closing~~their grant date of March 8, 2021 and the remaining 75% ~~will~~to vest on a monthly basis over the following thirty-six months. No other options have been granted under the 2021 Plan.

The following table summarizes the activity under the 2021 Plan for time vested options:


	Options Outstanding
	Number of Shares Subject to Stock Options Outstanding	Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value 1
Balance as of December 31, 2022	400	$	567.23	6.0	$	—
Granted	—	—
Exercised	—	—
Canceled/forfeited	(11)	593.38
Outstanding as of June 30, 2023	390	$	566.28	5.6	$	—
Options vested and expected to vest as of June 30, 2023	390	$	566.29	5.6	$	—
Exercisable as of June 30, 2023	364	$	564.21	5.4	$	—

_______________________

1The aggregate intrinsic value is calculated as the difference between the market value of the Company's common shares as of the relevant period end and the respective exercise prices of the options. The market value as of June 30, 2023 and December 31, 2022 was $7.26 and $57.90 per share, respectively, which is the closing sale price of View's common shares on that day as reported by the Nasdaq Global Market.

No options have been exercised under this plan in the six months ended June 30, 2023 and 2022. The total grant date fair value of stock options vested was $2.7 million and $16.2 million during the six months ended June 30, 2023 and 2022, respectively.

As of June 30, 2023, total unrecognized compensation cost related to unvested stock options, net of estimated forfeitures, was $6.4 million and is expected to be recognized over a weighted-average remaining service period of 1.6 years.

RSUs

2021 Officer RSUs ~~were subject~~

On March 8, 2021, the Company granted 208,333 RSUs (the “2021 Officer RSUs”) for shares of Class A Common Stock of the Company to ~~both time and market-based vesting conditions.~~View’s executive officers. The 2021 Officer RSUs time vest over a four-year period with 25% to vest on the twelve-month anniversary of ~~the Closing~~their grant date of March 8, 2021 and the remaining 75% to vest on a monthly basis over the following thirty-six months subject to the following market-based vesting. 50% of the 2021 Officer RSUs granted to each executive officer will only vest if the share price hurdle of ~~$15.00~~$900.00 is achieved and the remaining 50% of such 2021 Officer RSUs will vest if the share price hurdle of ~~$20.00~~$1,200.00 is achieved.

On August 5, 2022, the ~~Board~~Company’s board of ~~Directors of the Company,~~directors, upon recommendation of the Compensation Committee, approved an amendment (the “Amendment”) to the 2021 Officer RSUs under the 2021 Plan, which provided that, effective as of September 8, 2022, the market-based vesting conditions applicable to the 2021 Officer RSUs were no longer applicable, and the awards will continue to vest subject only to the time-based vesting conditions, subject to the executive’s continued employment with the Company through each applicable vesting date. Any 2021 Officer RSUs that are not time-vested as of the date of the executive’s termination of employment with the Company shall be forfeited and returned to the 2021 Plan. Except as expressly amended by the Amendment, all the terms and conditions of the 2021 Officer RSUs remained in full force and effect.

The Company accounted for the Amendment as a modification of the original awards. ~~The~~At the modification date, the Company calculated the incremental compensation cost of $22.5 million as the excess of the fair value of the modified awards over the fair value of the original awards immediately before the modification. For awards that were vested as of the modification date, the Company recognized $7.9 million of the incremental compensation cost ~~immediately.~~immediately as of the modification date. For awards that were unvested as of the modification date, the sum of the remaining $14.6 million of the incremental compensation cost and the remaining unrecognized compensation cost of $21.2 million for the original awards on the modification date has

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

been and will continue to be recognized over the remaining requisite service period of ~~2.4~~2.6 years ~~as of~~from the modification date. The 2021 Officer RSUs have been included within the disclosures below for the outstanding RSUs under the 2021 Plan.

Other RSUs

The Company has also issued approximately 259,504 RSUs to its employees, directors, and officers (“Others RSUs”) under the 2021 Plan, which vest upon the achievement of specific time-based measures. The fair value for Other RSUs is calculated based on the stock price on the grant date and expensed ratably over the requisite service period, which ranges between one and four years.

The following table summarizes the activities for the outstanding RSUs under the 2021 Plan during the six months ended June 30, 2023:


	Number of Unvested Shares	Weighted Average Grant Date Fair Value 1
Outstanding as of December 31, 2022	254	$	240.00
Granted	106	32.89
Vested	(97)	162.67
Canceled	(24)	71.27
Outstanding as of June 30, 2023	240	$	196.30

The total grant date fair value of RSUs vested was $15.7 million and $0.3 million during the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023, total unrecognized compensation cost related to RSUs, net of estimated forfeitures, was $29.6 million and is expected to be recognized over a weighted-average remaining service period of 2.2 years.

To the extent that the actual forfeiture rate is different than what the Company has anticipated, stock-based compensation related to these awards will be different from expectations.

CEO Incentive Plan

In connection with the Closing of the Merger, the Company adopted the 2021 Chief Executive Officer Incentive Plan (the “CEO Incentive Plan”) effective March 8, 2021. Pursuant to the CEO Incentive Plan and the terms of the Agreement and Plan of Merger, onOn March 8, 2021, the Company granted the CEO an option award (the “CEO Option Award”) to purchase Class A common stock of the Company at an exercise price of ~~$10.00~~$600.00 per share (the CEO Incentive Plan”), which vests and becomes exercisable upon satisfaction of the performance conditions set forth in the table below, contingent upon the CEO’s continued employment with the Company on each such vesting date.


Tranche	Option Shares (#)	Average 60-day Trading Price per Share of the Entity ($)
1	41,666	$	1,200.00
2	41,666	1,800.00
3	41,666	2,400.00
4	41,666	3,000.00
5	41,666	3,600.00
6	41,666	4,200.00
7	41,666	4,800.00
8	41,666	5,400.00
9	41,666	6,000.00
10	41,666	$	6,600.00

As of June 30, 2023, total outstanding stock options under the CEO Incentive Plan was 416,660 shares with a grant date exercise price per share of $600.00 and remaining contractual term of 7.7 years. As of June 30, 2023, the CEO Option Award had no intrinsic value. No other options have been granted under the CEO Incentive Plan.

As of June 30, 2023, total unrecognized compensation cost related to options under the CEO Incentive Plan, net of estimated forfeitures, was $45.1 million and is expected to be recognized over a weighted-average remaining service period of 3.3 years.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

Tranche Option Shares (#) Average 60-day
Trading Price
per Share of the
Entity ($)
1 2,500,000 $ 20.00
2 2,500,000 30.00
3 2,500,000 40.00
4 2,500,000 50.00
5 2,500,000 60.00
6 2,500,000 70.00
7 2,500,000 80.00
8 2,500,000 90.00
9 2,500,000 100.00
10 2,500,000 $ 110.00
Valuation of Stock-Awards

~~The following table summarizes the activity~~No options were issued under the 2021 Plan ~~(in thousands, except per share data~~or the CEO Incentive Plan in the six months ended June 30, 2023 and ~~contractual term)~~2022. The grant date fair value for ~~time vested options:~~

Options Outstanding
Number of
Shares
Subject to
Stock Options
Outstanding Weighted-
Average
Exercise Price Weighted-Average
Remaining
Contractual Term
(in years)
Aggregate
Intrinsic
Value 1
Balance as of December 31, 2021 27,582 $ 9.43 7.0 $ —
Granted — —
Exercised — —
Canceled/forfeited (3,429) 9.34
Outstanding as of September 30, 2022 24,153 $ 9.45 6.3 $ —
Options vested and expected to vest as of September 30, 2022 24,116 $ 9.45 6.3 $ —
Exercisable as of September 30, 2022 21,007 $ 9.42 6.1 $ —

~~_______________________~~

1~~The aggregate intrinsic value is~~Other RSUs issued under the 2021 Plan in the six months ended June 30, 2023 was calculated as the difference between the market value of the Company's common shares as of the relevant period end and the respective exercise prices of the options. The market value as of September 30, 2022 and December 31, 2021 was $1.34 and $3.91 per share, respectively, which isusing the closing sale price of ~~View's common shares on that day as reported by the Nasdaq Global Market.~~

No options have been issued or exercised under this plan in the nine months ended September 30, 2022. The weighted-average grant date fair value per share of stock options granted was $4.38 for the nine months ended September 30, 2021. The total grant date fair value of stock options vested was $22.3 million and $18.9 million during the nine months ended September 30, 2022 and 2021, respectively. The total intrinsic value of options exercised during the nine months ended September 30, 2021 was $0.4 million.

As of September 30, 2022, total unrecognized compensation cost related to unvested stock options, net of estimated forfeitures, was $12.1 million and is expected to be recognized over a weighted-average remaining service period of 1.9 years.

In addition to the time vested options above, as of September 30, 2022, total outstanding stock options under the CEO Incentive Plan was 25,000,000 shares which were issued during the three months ended March 31, 2021 with a grant date exercise price per share of $10.00 and remaining contractual term of 8.4 years. As of September 30, 2022, the CEO Option Award had no intrinsic value.

The weighted-average grant date fair value per share of stock options granted under the CEO Incentive Plan was $3.54 for the nine months ended September 30, 2021. As of September 30, 2022, total unrecognized compensation cost related to options under the CEO Incentive plan, net of estimated forfeitures, was $59.1 million and is expected to be recognized over a weighted-average remaining service period of 3.8 years.

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~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

~~The following table summarizes the activities for the outstanding RSUs under~~ the Company’s ~~2021 Plan (in thousands, except per share data) during the nine months ended September 30, 2022:~~

Number of
Unvested Shares
Weighted
Average
Grant Date
Fair Value 1
Outstanding as of December 31, 2021 11,643 $ 6.14
Granted — —
Vested (4,082) 8.21
Canceled (811) 6.28
Outstanding as of September 30, 2022 6,750 $ 8.21

~~_______________________~~

1~~The weighted average grant date fair value of the Officer RSUs that vested during the period and the Officer RSUs outstanding at~~ ~~September 30, 2022~~ ~~is calculated as the sum of~~Class A common stock on the grant date fair value per share of the original awards plus the incremental cost per share as of the date of the modification. The grant date fair value of the original Officer RSUs was $6.12 per share. The incremental cost of the Officer RSUs as of the date of modification, August 5, 2022, was $2.09 per share.

The total grant date fair value of RSUs vested was $33.5 million and $0.5 million during the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022, total unrecognized compensation cost related to RSUs, net of estimated forfeitures, was $33.6 million and is expected to be recognized over a weighted-average remaining service period of 2.4 years.

~~To the extent that the actual forfeiture rate is different than what the Company has anticipated, stock-based compensation related to these awards will be different from expectations.~~

~~Valuation~~

No options have been issued under this plan in the nine months ended September 30, 2022. The estimated grant date fair values of the Company’s time vested stock options granted to employees and non-employees under the plan in the nine months ended September 30, 2021 were calculated using the Black-Scholes option-pricing models based on the following assumptions:


									~~Nine Months Ended September 30,~~
									~~2021~~
~~Expected volatility~~									~~53.0%~~
~~Expected terms (in years)~~									~~6.0~~
~~Expected dividends~~									0%
~~Risk-free rate~~									~~1.07%~~

Prior to the Merger, due to the absence of a public market, the Company’s common stock required the Company’s board of directors to estimate the fair value of its common stock for purposes of granting options and for determining stock-based compensation expense by considering several objective and subjective factors, including contemporaneous third-party valuations, actual and forecasted operating and financial results, market conditions and performance of comparable publicly traded companies, developments and milestones in the Company, the rights and preferences of redeemable convertible preferred stock and common, and transactions involving the Company’s stock. The fair value of the Company’s common stock was determined in accordance with applicable elements of the American Institute of Certified Public Accountants guide, Valuation of Privately Held Company Equity Securities Issued as Compensation.

The estimated grant date fair value for each tranche of CEO Option Award and Officer RSUs is determined by using the Monte Carlo Simulation valuation model and the assumptions below. The estimated grant date fair value of the Officer Options is determined using the Black-Scholes option-pricing model. The valuation models incorporated the following key assumptions:

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~~View, Inc.~~

~~Notes to Condensed Consolidated Financial Statements~~

~~(Unaudited)~~

CEO Option
Award Officer RSUs (Prior to Modification on August 5, 2022) Officer Options
Expected stock price $9.19 $9.19 $9.19
Expected volatility 54.0% 56.0% 53.0%
Risk-free rate 1.59% 0.60% 1.07%
Expected terms (in years) 10.0 4.0 6.0
Expected dividends 0% 0% 0%
Discount for lack of marketability 20% n/a n/a

As noted above, the Officer RSUs were modified on August 5, 2022 to remove the market-based vesting condition; and therefore, the valuation assumptions above for the Officer RSUs only apply to the original awards. Refer above for further discussion of the impact of the modification.date.

Stock-based Compensation Expense

The Company’s stock-based compensation included in its condensed consolidated statements of comprehensive loss was as follows (in thousands):


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended June 30,				Six Months Ended June 30,
		2022		2021		2022		2021			2023		2022		2023		2022
Cost of revenue	Cost of revenue	$	418	$	1,286	$	1,126	$	3,461	Cost of revenue	$	309	$	345	$	723	$	708
Research and development	Research and development	2,032		2,670		3,587		6,213		Research and development	1,020		1,486		2,194		1,555
Selling, general, and administrative	Selling, general, and administrative	20,776		18,514		54,122		45,533		Selling, general, and administrative	9,431		16,310		19,035		33,346
Total	Total	$	23,226	$	22,470	$	58,835	$	55,207	Total	$	10,760	$	18,141	$	21,952	$	35,609

11.Restructuring

In March 2023, the Company announced a restructuring plan to reduce structural costs, including its workforce. As a result of the restructuring plan, the Company recorded $4.2 million in restructuring costs during the three months ended March 31, 2023 for employee severance and other costs for employees impacted by the plan. Further, the Company recorded $1.3 million in restructuring costs during the three months ended June 30, 2023 primarily related to the relocation of certain long-lived assets associated with the Company’s R&D equipment from its headquarters in Milpitas, California to its manufacturing facility in Olive Branch, Mississippi. The Company expects to incur additional restructuring costs associated with the plan to relocate such R&D equipment. No other restructuring charges were incurred during the six months ended June 30, 2023.

As of March 31, 2023, there were $4.2 million in restructuring cost related liabilities recorded in accrued compensation. $2.9 million of the accrued restructuring costs related to compensation were paid during the second quarter of 2023 and $0.1 million in additional restructuring costs associated with the relocation of assets were accrued as of June 30, 2023. As such, the total ending liability related to restructuring costs was $1.4 million as of June 30, 2023.

The Company may incur additional costs in the future due to events that may occur as a result of, or that are associated with, the restructuring or other undetermined plans to reduce structural costs.

12.Income Taxes

The Company calculates the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full fiscal year to ordinary income or loss for the interim reporting period. When applicable, the year-to-date tax provision reflects adjustments from discrete tax items.

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, the Company’s income tax expense was immaterial.

As the Company’s U.S. operations are projecting to be in a taxable loss in the year and based on all available objectively verifiable evidence during the ~~three and nine~~six months ended ~~September~~June 30, ~~2022,~~2023, the Company believes it is more likely than not that the tax benefits of the U.S. losses incurred will not be realized. Accordingly, the Company will continue to maintain a full valuation allowance on the U.S. deferred tax assets. The Company’s income tax expense for the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 is due primarily to income taxes for foreign operations.

The Company accounts for the uncertainty in income taxes by utilizing a comprehensive model for the recognition, measurement, presentation, and disclosure in financial statements of any uncertain tax positions that have been taken or are expected to be taken on an income tax return. During the three and ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, there have been no changes in the estimated uncertain tax benefits.

In August 2022, the IRA and CHIPS and Science Act were passed by Congress and signed into law. The IRA introduced new provisions, including a 15 percent corporate alternative minimum tax for certain large corporations that have at least an average of $1.0 billion adjusted financial statement income over a consecutive three-tax-year period. The corporate minimum tax will be effective for fiscal 2023. The Company is currently evaluating the applicability and the effect of the new law to its financial results.

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

13.Net Loss Per Share

The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data):

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 2022 2021
Net loss $ (82,065) $ (94,152) $ (247,323) $ (263,907)
Weighted-average shares outstanding, basic and diluted 214,775,043 212,154,820 214,422,143 160,497,517
Net loss per share, basic and diluted $ (0.38) $ (0.44) $ (1.15) $ (1.64)

~~As a result of the Merger, the weighted-average number of shares of common stock used in the calculation of net loss per share have also been retroactively converted by applying the Exchange Ratio.~~


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Net loss	$	(56,360)	$	(82,886)	$	(123,649)	$	(165,258)
Weighted-average shares outstanding, basic and diluted	3,994,813		3,570,886		3,966,316		3,570,711
Net loss per share, basic and diluted	$	(14.11)	$	(23.21)	$	(31.17)	$	(46.28)

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, common stock equivalents consisted of stock options, restricted stock units, warrants, and ~~warrants.~~the Convertible Notes. For the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, common stock equivalents consisted of stock options, restricted stock units, and warrants. None of the common stock equivalents were included in the calculation of diluted net loss per share for all periods presented as the Company recorded a net loss.

The following outstanding shares of common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have had an anti-dilutive effect:


		September 30,			June 30,
		2022	2021		2023	2022
Stock options to purchase common stock	Stock options to purchase common stock	24,153,378	29,159,417	Stock options to purchase common stock	389,634	412,838
Unvested restricted stock units	Unvested restricted stock units	6,750,000	182,951	Unvested restricted stock units	239,578	—
Warrants to purchase common stock	Warrants to purchase common stock	21,305,462	20,311,920	Warrants to purchase common stock	456,433	355,085

Convertible Notes (on an as-converted basis)				Convertible Notes (on an as-converted basis)	1,533,650	—

Total	Total	52,208,840	49,654,288	Total	2,619,295	767,923

The ~~4,970,000~~82,835 Sponsor Earn-Out Shares are excluded from basic and diluted net loss per share as such shares are contingently recallable until the share price of the Company exceeds specified thresholds that have not been achieved as of ~~September~~June 30, ~~2022.~~2023.

The common stock equivalents subject to the CEO Option Award are excluded from the anti-dilutive table as the underlying shares are contingently issuable until the share price of the Company exceeds the specified thresholds that have not been achieved. As of ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, the thresholds for the CEO Option Award have not been achieved, and ~~25,000,000~~416,660 stock options for the CEO Option Award are outstanding.

Prior to the Amendment described further in Note 1 110, the common stock equivalents subject to the 2021 Officer RSUs were excluded from the anti-dilutive table, as the underlying shares were contingently issuable since the share price of the Company had not exceeded the specified thresholds. As of ~~September~~June 30, ~~2021,~~2022, the thresholds for the 2021 Officer RSUs had not been achieved, and ~~12,500,000~~180,000 RSUs of the 2021 Officer RSUs were outstanding. As of ~~September~~June 30, ~~2022,~~2023, due to the Amendment, the underlying shares are no longer contingently issuable and ~~6,750,000~~78,750 unvested 2021 Officer RSUs are included in the anti-dilutive table.

14.~~Subsequent Events~~Related Party Transactions

The Purchasers of the Convertible Notes include affiliates of RXR FP, a party with which the Company has an existing commercial relationship and with which it has engaged in and continues to engage in corporate transactions. The Chairman and CEO of RXR FP joined the Company’s board of directors in November 2022. As such, RXR FP was identified as a related party during fiscal year 2022.

Convertible Notes, net of debt issuance costs, outstanding to RXR FP (the “RXR Notes”) as of June 30, 2023 and December 31, 2022 totaled $113.6 million and $109.0 million, respectively. Interest of $2.6 million and $2.0 million associated with the RXR Notes was accrued within other liabilities on the Consolidated Balance Sheet as of June 30, 2023 and December 31, 2022, respectively. The Company incurred $2.8 million and $5.4 million interest expense, inclusive of the amortization of debt issuance costs, on the RXR Notes during the three and six months ended June 30, 2023, respectively. No interest expense was incurred on the RXR Notes during the three and six months ended June 30, 2022, as the RXR Notes were issued in October 2022.

The Company ~~has evaluated subsequent events~~recognized revenue from RXR FP, or an agent acting on behalf of RXR FP, of $4.0 million and $1.8 million during the ~~balance sheet date through the date the financial statements were issued~~three months ended June 30, 2023 and ~~has determined that, other than the events disclosed below, no additional material subsequent events exist.~~

~~Private Placement of 6.00% / 9.00% Convertible Senior PIK Toggle Notes due 2027~~

~~Investment Agreement~~

~~On October 25,~~ 2022, ~~the~~respectively. The Company ~~entered into~~recognized revenue from RXR FP, or an Investment Agreement (the “Investment Agreement”) with the Purchasers (as defined in the Investment Agreement) relating to the sale by the Company to the Purchasers of $200.0 million aggregate principal amount of Convertible Senior PIK Toggle Notes due 2027 (the “Notes”). On October 26, 2022, the Company completed the sale to the Purchasers of the Notes pursuant to the Investment Agreement resulting in net proceeds of approximately $194 million, after deducting fees and estimated offering expenses.

The Notes are senior, unsecured obligations of the Company, bearing interest at a rate of 6.00% per annum, to the extent paid in cash (“Cash Interest”), and 9.00% per annum, to the extent paid in kind through an increase in the principal amount of the

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

Notes (“PIK Interest”). The Company can elect to make any interest payment through Cash Interest, PIK Interest or any combination thereof. Any PIK Interest will be paid by issuing notes (“PIK Notes”) in the form of physical notes. Such PIK Notes will bear interest from and after the date of such PIK Interest payment. Interestagent acting on the Notes is payable semi-annually in arrears on April 1 and October 1 of each year, commencing on April 1, 2023. It is expected that the Notes will mature on October 1, 2027, unless redeemed, repurchased or converted in accordance with their terms prior to such date.

Subject to certain limitations, the Investment Agreement provides the Purchasers with certain registration rights for the shares of the Company’s Class A common stock, par value $0.0001 per share (“Common Stock”), issuable upon conversion of the Notes and exercise of the Warrants (as defined below). The Notes are convertible at an initial conversion rate equal to 747.6636, subject to certain adjustments as provided in the Indenture. All conversions will be subject to an increased conversion rate in accordance with the Indenture, based on the Conversion Date (as defined in the Indenture).

The Company may not redeem the Notes prior to October 1, 2025. The Company may redeem the Notes in whole or in part, at its option, on or after October 1, 2025, and prior to the 41st scheduled trading day immediately preceding the maturity date, for cash at the applicable redemption price if the last reported sale price of the Common Stock has been at least 150% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides the applicable redemption notice.

In the event of a fundamental change, holders of the Notes will have the right to require the Company to repurchase all or a portion of their Notes at a price equal to 100% of the capitalized principal amount of Notes, plus any accrued and unpaid interest to, but excluding, the repurchase date.

~~The Purchasers include affiliates~~behalf of RXR ~~a party with which the Company has an existing commercial relationship and with which it has engaged in prior corporate transactions. The Chairman and CEO~~FP, of RXR joined the Company’s Board of Directors in November 2022. As such, RXR has been identified as a related party. The Company has evaluated the relationship with RXR and determined that all previous transactions with the Purchasers were entered into in the ordinary course of business. All future transactions will be reviewed and approved as a related party transaction in accordance with the related party transaction approval process implemented by the Company. The Company analyzed the terms of all previous transactions with RXR and concluded that the terms represented transactions conducted at arm’s length. The Company recognized revenue from RXR of $1.4$7.4 million and ~~$0.6~~$3.5 million during the ~~three~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021, respectively, and $4.9 million and $0.6 million during the nine months ended September 30,~~ 2022, ~~and 2021,~~ respectively. In addition, the Company had no$1.0 million in deferred revenue, $7.5 million in contract loss accruals, $1.7 million contract assets associated with contracts with RXR FP, $7.4 million accounts ~~receivables~~receivable due from RXR FP or an agent acting on behalf of RXR FP, and an immaterial amount of accounts payable due to RXR FP as of June 30, 2023. The Company had $4.2 million in deferred revenue, $8.7 million in contract loss accruals, no contract assets associated with contracts with RXR FP, $7.3 million accounts receivable due from RXR FP or an agent acting on behalf of RXR FP, and no accounts payable due to RXR FP as of ~~September 30, 2022 and~~ December 31, ~~2021.~~

~~Strategic Agreement & Warrant Agreements~~

On October 25, 2022, the Company and RXR FP Services LLC (“RXR FP”) entered into an Agreement for Strategic Planning and Consulting Services (the “Strategic Agreement”). Pursuant to the Strategic Agreement, RXR FP was appointed to render strategic planning and consulting services to the Company. In consideration of RXR FP’s performance of its obligations under the Strategic Agreement, the Company agreed to issue to RXR FP warrants (the “Warrants”) to purchase,2022. As discussed in ~~the aggregate, 9,511,128 shares of Common Stock. On October 25, 2022,~~Note 9, the Company issued the RXR Warrants to RXR FP ~~pursuant~~on October 25, 2022. Refer to ~~certain Common Stock Purchase Warrant Agreements (the “Warrant Agreements”).~~

Note 9 for further information on the RXR Warrants.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following management’s discussion and analysis is provided in addition to the accompanying condensed consolidated financial statements and notes, and for a full understanding of the Company's results of operations and financial condition should be read in conjunction with the condensed consolidated financial statements and notes included in this Quarterly Report on Form 10-Q included in Part I, Item 1, “Financial Statements (Unaudited)” and the consolidated financial statements and notes for the fiscal year ended December 31, ~~2021~~2022 included in the Company's ~~2021~~2022 Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on ~~June 15, 2022.~~March 31, 2023.

Overview

Our Business

We are a leading smart buildings platform and technology company that transforms buildings to improve human health and experience, reduce energy consumption and carbon emissions, and generate additional revenue for building owners.

Our innovative products are designed to enable people to lead healthier and more productive lives by increasing access to daylight and views, while minimizing associated glare and heat from the sun and keeping occupants comfortable. These products also simultaneously reduce energy consumption from lighting and HVAC, thus reducing carbon emissions. To achieve these benefits, we design, manufacture, and provide electrochromic or smart glass panels to which we add a 1 micrometer (~1/100th the thickness of human hair) proprietary electrochromic coating. These smart glass panels, in combination with our proprietary network infrastructure, software and algorithms, intelligently adjust in response to the sun by tinting from clear to dark states, and vice versa, to minimize heat and glare without ever blocking the view. In addition, we offer a suite of fully integrated, cloud-connected smart-building products that are designed to enable us to further optimize the human experience within buildings, improve cybersecurity, further reduce energy usage and carbon footprint, reduce real estate operating costs, provide real estate owners greater visibility into and control over the utilization of their assets, and provide a platform on which to integrate and deploy new technologies into buildings.

Our earlier generation products are described best as “smart glass,” which are primarily composed of three components that all work together to produce a solution:

•the insulating glass ~~unit;~~unit, which is either double or triple pane with a micrometer semiconductor (or electrochromic) coating;

•the network ~~infrastructure;~~infrastructure, which is composed of the controllers, connectors, sensors, and cabling; and

•the ~~software;~~software, which includes the predictive algorithms, artificial intelligence, remote management tools, and user-facing iOS and Android apps, to control the tint of the glass.

After we completed installations in a few hundred buildings, we identified an opportunity to use our network infrastructure and cabling as the backbone on which different smart and connected devices in a typical building could operate. We believe customers using View Smart Glass can leverage our network as their building’s operations technology infrastructure to reduce duplicative labor costs, reduce materials usage, provide better cyber security, improve visibility and management of connected devices, and future-proof the building through easy upgradability.

Recognizing the opportunity to significantly improve the human experience, energy performance and carbon footprint in buildings, and real estate operating costs through adoption of technology, we began selling a Smart Building Platform, which is a fully integrated smart window platform, to building owners starting in 2021. Concurrent with the commencement of the sales efforts, we also began hiring an extensive team of construction managers, project managers, and building specialists to enable us to work towards delivering the fully installed and integrated Smart Building Platform, which had historically been the responsibility of the general contractor’s glazing and low-voltage electrician (“LVE”) subcontractors.

The Smart Building Platform includes ~~an upgraded network infrastructure and~~ end-to-end design and deployment services, and also enables next generation Smart Building Technologies. We began offering our Smart Building Platform for the following strategic reasons:

•To optimize the design, aesthetics, energy performance and cost of the entire smart façade (or digital skin) of the building, rather than just one component (smart glass), thus benefiting both customers and ~~View.~~us.

•To elevate the window selection and purchase decision to a customer and decision maker that has a more global view of the project and is in a much better position to make an informed decision regarding all the benefits provided by our Smart Building Platform.

•To accelerate the integration of new technologies into the fabric of the building. Today, this includes integrating environmental quality sensors and immersive, transparent, high-definition displays into smart windows. Importantly, our smart façade design enables future hardware and software upgrades into the building infrastructure.

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•We believe delivering a digital, connected façade and smart building platform will enable future business opportunities and pricing models as buildings, both existing and new, incorporate additional technology and connected products.

Our next generation, smart building network is designed as a scalable and open infrastructure in which the smart window is now another node of the network; in addition, the network is now equipped to host other connected devices and applications, from both ~~View~~us and third parties, as additional nodes on the network. The network has its own 48v direct current power and power-over-ethernet ports to incorporate other connected devices on a standard protocol. Also integrated into the network throughout the building is gigabit speed linear ethernet coaxial cable, as well as optical fiber. Computer processing is also built into the backbone of the network with x86 and ARM processing cores. The network also includes an operating system with capabilities to run third party applications and services, security protocol to protect buildings from cyberattacks, and several elements of a digital twin of the building. Our smart building network also hosts artificial intelligence and machine learning engines, which we developed, and also provides access to artificial intelligence and machine learning engines that are in the cloud. The exterior of the building is the largest in surface area. With the smart building network, the entire exterior of the building can be digitized. Activating the exterior through digitization creates multiple opportunities for building owners and occupants.

~~Our Smart Building Platform~~This next generation, smart building network enables other devices and smart building applications to be built and connected to our smart building network. A few applications we have already built and deployed on our next generation network include:

•Transparent Displays: View Immersive Display. Integrated into the smart window and connected to the same network as the glass, Immersive Display allows users to turn their windows into the equivalent of an iPad or tablet — an interactive digital display that allows users a new way to digest multi-media content. Immersive Displays are large-format (55 inches and larger), digital, high-definition, interactive canvases that can be used to broadcast content, host video calls and display information and digital art to large groups of people, while maintaining a view of the outdoors through the window on which it is integrated.

•Personalized Health: View Sense. An integrated, enterprise-grade, secure, sensor module that monitors multiple environmental variables (e.g., CO2, Temperature, Volatile Organic Compounds, Humidity, Dust, Light, and Noise) to provide illustrative data and information to building management teams in order to improve building performance and enhance human health and comfort.

Our R&D continues to focus on not only improving the smart glass product but also on continually bringing more smart building applications and capabilities to market, as well as collaborating with other industry partners to integrate their devices and applications with our smart building network, with the aim of making building occupants more comfortable, healthier, and more productive, making buildings more sustainable, and providing better information to building owners to streamline operations and reduce operating costs.

In terms of the value propositions to our customers, our earlier generation smart glass product focused primarily on improving occupant experience and reducing energy costs through adjustments of the glass tint. The current generation of the product focuses not only on improving energy savings and user experience through smart glass; it also focuses on increasing occupant productivity, creating healthier buildings, and using data from other devices to develop broader insights that further improve building operations and reduce energy usage. Current scientific research supports that cognitive function and in turn, productivity goes up when building occupants are exposed to more natural light and comfortable workspaces; they sleep better, and they experience less eye strain, fewer headaches, and lower stress. In a study published in the International Journal of Environmental Health and Public Health in 2020, researchers at the University of Illinois and SUNY Upstate Medical University found that employees working next to View Smart Glass during the day slept 37 minutes longer each night, experienced half as many headaches, and performed 42% better on cognitive tests. The research was sponsored in part by ~~View.~~us.

We also recognized that the new Smart Building Platform offering would potentially enable usView to move ‘up’ the supply chain of the construction industry. Whereas our traditional offering placed us in the role of a supplier to subcontractors of the General Contractor (“GC”), the level of integration and oversight needed to ensure a quality installation and integration of the complete smart building platform is designed to incentivize building owners and GCs to engage directly with us, engaging us to assume the role of the prime contractor for the platform rather than supplier of subcomponent materials. This would also better position us to upsell additional goods and services to the building owners in the future, which could be more efficiently integrated into the smart building platform than with the traditional offering.

Today, our Smart Glass products are installed into over 4048 million square feet of buildings, including offices, hospitals, airports, educational facilities, hotels, and multi-family residences. In addition to our Smart Building Platform, we continue to sell smart windows through our Smart Glass offering and several, individual smart building products through our Smart Building Technologies offerings. Across our combined product lines, our products are installed in 100 million square feet of buildings.

To date, we have devoted our efforts and resources towards the development, manufacture, and sale of our product platforms, which we believe have begun to show strong market traction. We have also devoted significant resources to enable our View

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Smart Building Platform, a new offering beginning in 2021. For the three months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, our revenue was ~~$23.8~~$28.0 million and ~~$18.9~~$16.3 million, respectively, representing period-over-period growth of ~~25.8%~~71.8%. For the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, our revenue was ~~$57.1~~$46.4 million and ~~$45.6~~$33.3 million, respectively, representing period-over-period growth of ~~25.3%~~39.2%.

Key Factors Affecting Operating Results

Execution of Growth Strategies

We believe that we are just beginning to address our market opportunity, which we expect to be driven by four multi-decade, secular trends: (i) climate change, Environmental, Social and Governance (“ESG”) and sustainability, (ii) a growing focus on human health inside buildings, (iii) an increased desire for better human experiences in buildings, and (iv) a growing demand for smart and connected buildings.

To capitalize on these trends and our market opportunity, we must execute on multiple growth initiatives, the success of which may depend on our ability to develop mainstream acceptance of our products, including (i) increasing awareness of our products and their benefits across major markets in North America and internationally, (ii) increasing recurring sales, (iii) expanding our product portfolio, (iv) expanding our sales channels to include real estate brokers, (v) continuing to develop strong relationships with ecosystem partners such as building owners, developers, tenants, architects, contractors, low voltage electricians and glaziers, and (vi) expanding outside North America into international markets.

On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was passed by Congress and signed into law by President Joe Biden. The IRA includes the implementation of a new alternative minimum tax, an excise tax on stock buybacks, and significant tax incentives for energy and climate incentives, and other provisions. ~~We are evaluating the impact of the~~The Investment Tax Credit (“ITC”) available to our customers under the IRA ~~which~~ is expected to ~~bring the cost of our products to cost parity with conventional windows. We believe the ITC will~~ increase demand for our products by reducing the net cost of our products to our customers. However, the full future impact of the ITC cannot be known with any certainty, and we may not recognize any or all of the expected benefits of the ITC.

~~The above~~While we believe that the prevailing secular trends will continue to drive adoption of smart glass, current macro-economic factors, including higher interest rates, uncertainty in the lending markets and post COVID-19 pandemic office occupancy are having a negative impact on the overall real estate market. Additionally, the market for our products could be affected by concerns about our current liquidity and future viability.

Our growth strategies depend upon our ability to continue as a going concern. As ~~discussed further in~~ ~~Note 14~~, we entered into an agreement on October 25, 2022 resulting in the sale of $200.0 million aggregate principal amount of Convertible Senior PIK Toggle Notes (the “Notes”). In addition, we implemented plans to reduce cash spend and increase cash collections during the third quarter of 2022, which resulted in a decrease of net cash outflow of $29.3 million, from $89.3 million for the three months ended June 30, 2022 to $60.0 million for the three months ended September 30, 2022. As of October 31, 2022, we had approximately $228 million in cash and cash equivalents. Due to the historical rate of cash outflows, we are not currently able to conclude that our existing cash and cash equivalents balance as of the date of this ~~filing will be adequate to fund our forecasted operating costs and meet our obligations; we have therefore~~Quarterly Report on Form 10-Q, the Company has determined that there is substantial doubt about ~~our~~its ability to continue as a going ~~concern.~~concern, as the Company believes it has adequate resources to fund its forecasted operating costs and meet its obligations into, but not beyond September 2023. This projection is based on our current expectations regarding revenues, collections, cost structure, current cash burn rate and other operating assumptions. To address our cash needs, we are actively seeking additional sources of capital. As there can be no assurance that such necessary financing will be available, we may execute other strategic alternatives to maximize stakeholder value, including further expense reductions, sale of all or portions of the business, corporate capital restructuring or formal reorganization, or liquidation of assets.

In order to reduce the cash used in operating activities, we implemented certain cost savings initiatives in the second half of 2022, as well as a restructuring plan in March 2023 as further discussed in Note 11 of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1. While ~~we plan to continue~~these plans are anticipated to reduce cash outflow when compared to prior periods, our ~~ability to fund our operating costs and meet our obligations beyond twelve months from the date of this filing~~continued existence is dependent upon our ability to obtain additional financing, as well as to attain and maintain profitable operations by entering into profitable sales contracts and generating sufficient ~~operating~~ cash ~~flow.~~flow to meet our obligations on a timely basis. Our business will require a significant ~~amounts~~amount of capital ~~to sustain operations and we will need to make the~~ investments ~~we need~~ to execute ~~these~~our long-term business plans.

Technology Innovation

With more than 1,400 patents and patent filings and over 1415 years of research and development experience, we have a history of technological innovation. We have a strong research and development team, including employees with expertise in all aspects of the development process, including materials science, electronics, networking, hardware, software, and human factors research. AsSince inception, we have ~~since inception, we intend to continue making~~made significant investments in research and development and hiring top technical and engineering talent to improve our existing products and develop new products ~~which will~~to increase our differentiation in the market. In 2021 and 2020, we introduced a new suite of products to complement our market-leading smart glass and optimize the human experience while making buildings more intelligent. These products are collectively referred to under the umbrella brand name “The Smart Building Cloud”:

•View Net. Our next generation controls, software, and services (“CSS”), a cloud-connected, network infrastructure offering that powers ~~View’s~~our smart glass products and can incorporate and power other smart building devices from ~~View~~us and other companies. This high bandwidth data and low voltage power network serves as the backbone to an intelligent

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building platform and provides future-proofing by enabling the addition of new capabilities during a building’s lifetime.

•View Immersive Display. Our transparent, digital, interactive surface product that incorporates see-through, high definition displays directly onto the smart window.

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•View Sense. Modules that provide the ability to measure and optimize light, humidity, temperature, air quality, dust, and noise to improve occupant wellness.

•View Secure Edge. Our plug-and-play edge-to-cloud solution that enables IT and digital innovation teams to securely connect new and existing buildings to the cloud; centrally manage building networks, systems, and data in the cloud; and deploy edge applications for real-time processing, insights, and optimizations.

•View Remote Access. Our secure access portal that enables IT teams to reduce the cost and cybersecurity risks of maintaining smart buildings by providing vendors and technicians with secure, auditable, time-bound remote access to building networks and devices.

•View Building Performance. Our configurable application and web-based tool that enables building managers to measure, optimize and automate building performance with comprehensive, contextual, and actionable insights consolidated from disparate on-premises and cloud-based systems.

•View Workplace Experience. Our configurable application and web-based tool that enables corporate facilities managers to create healthier, more efficient, and more productive workplaces by uncovering actionable insights related to building health, space utilization and workplace operations.

~~We expect~~With the completed launch and ramp of our fourth-generation smart glass product and our Smart Building Platform product, as well as the launch of new product offerings in our Smart Building Technologies behind us, we have recently determined to reduce the level of spend in research and development as we focus on the profitability of our business. As such, we anticipate a reduction in research and development expenses during 2023 as compared to ~~increase in absolute dollars over time to maintain our differentiation in the market.~~prior periods.

Competition

We compete in the commercial window industry and the electrochromic glass industry, as well as within the larger smart building products industry, each of which is highly competitive and continually evolving as participants strive to distinguish themselves within their markets, including through product improvement, addition of new features, and price. We believe that our main sources of competition are existing commercial window manufacturers, electrochromic glass manufacturers, and companies developing smart building products and intrusion detection solution technologies. We believe the primary competitive factors in our markets are:

•Technological innovation;

•Ability to integrate multiple systems efficiently and effectively;

•Product performance;

•Product quality, durability, and price;

•Execution track record; and

•Manufacturing efficiency.

Capacity

~~View~~We currently ~~manufactures~~manufacture the insulating glass units (“IGUs”) included in the View Smart Glass and View Smart Building Platform product offerings at our production facility located in Olive Branch, Mississippi. We operate a sophisticated manufacturing facility designed for performance, scale, durability, and repeatability. Our manufacturing combines talent, equipment, and processes from the semiconductor, flat panel display, solar and glass processing industries. Our proprietary manufacturing facility has been in use since 2010. We currently operate one production line in our facility with a name-plate capacity of approximately 5 million square feet of smart glass per year. In addition, we have partially completed the construction of a second production line at our Olive Branch facility. Once operational, we expect our facility’s name-plate capacity to increase by an additional 7.5 million square feet of smart glass per year, bringing our total name-plate capacity of our facility to 12.5 million square feet per year. We believe our manufacturing facility will position us to achieve our strategic plans for economies of scale, meet future demand, and achieve profitability.

As of ~~September~~June 30, ~~2022,~~2023, we have invested over $400 million in capital expenditures primarily in our factory. We expect to incur additional factory capital expenditure of up to approximately $90 million ~~over the next four years~~in future periods with respect to facility automation and completion of the second production line to support the expected growth in demand for our products. This will require

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additional financing in order to make these additional investments. We believe our facility, including the second production line, will enable us to achieve economies of scale, meet future demand, and achieve profitability.

~~Table of Conte~~n t s

Components of Results of Operations

Revenue

View Smart ~~Glass~~Building Platform

We generate revenue ~~under our View Smart Glass offering from (i) the manufacturing and sale of IGUs that are coated on the inside~~by providing customers with ~~our proprietary technology and are designed, programmed, and built to customer specifications that include sizes for specific windows, skylights, and doors in specified or designated areas of~~ a building and (ii) selling the CSS, which includes sky sensors, window controllers and control panels with embedded software, cables and connectors, that, when combined with the IGUs enable the IGUs to tint. Also included in CSS is a system design service, in which a design document is prepared to lay out the IGUs and CSS hardware for the building, as well as a commissioning service, in which the installed IGUs and CSS components are tested and tinting configurations are set by View. The glaziers and LVEs subcontracted by the end user are responsible for ensuring satisfactory adherence to the design document as the products are installed.

Our View Smart Glass revenue primarily relies on securing design wins with end users of our products and services, which typically are the owners, tenants, or developers of buildings. We start the selling process by pitching the View Smart Glass benefits and business outcomes to the building owners, tenants, or developers. The pricing for a project is primarily driven by the make-up, size, shape, total units of the IGU, and associated CSS. The design win is typically secured through a non-binding agreement with the owners, tenants, or developers of the buildings. Once a design win is secured, we negotiate and enter into legally binding agreements with our Smart Glass customers (typically glaziers for the IGUs and LVEs or general contractors for CSS) to deliver the Smart Glass products and services.

Our IGUs are custom-built and sold to customers through legally binding contracts. Each contract to provide IGUs includes multiple distinct IGUs. We recognize revenue from our IGU contracts over time as the IGU manufacturing work progresses.

Our contracts to provide the CSS network infrastructure include the sale of electrical connections schema, sky sensors, window controllers and control panels with embedded software, cables and connectors, and professional services to provide a system We recognize revenue at a point in time upon shipment of the control panels and electrical components, and upon customer acceptance for the design and commissioning services, both of which have a relatively short period of time over which the services are provided.

In limited circumstances, we contract to provide extended or enhanced warranties of our products outside of the terms of its standard assurance warranty, which are recognized as revenue over the respective term of the warranty period.

~~View~~fully functional Smart Building Platform,

~~Our View Smart Building Platform is~~ a complete interrelated and integrated platform that combines our smart glass IGUs, the fabrication, unitization, and installation of the framing of those IGUs, ~~any combination of View Smart Building Technologies,~~ and installation of the completed smart glass windows and CSS ~~components into a fully installed Smart Building Platform.~~components. We enter into contracts to provide our View Smart Building Platform with our customers, which typically are the owners, tenants or developers of buildings, or the general contractor acting on behalf of our customers.

~~In contrast~~The contract with the customer outlines our rights and obligations, including specifications of the integrated platform to ~~the View Smart Glass product delivery method, we are the principal party responsible for delivering the fully integrated Smart Building Platform. In doing so, we~~be provided. We take responsibility for all activities needed to fulfill ~~the~~our single performance obligation of transferring control to the customer of a fully operational Smart Building Platform deliverable; from design, fabrication, installation, integration, commissioning, and testing. Underlying these activities is our responsibility for performing an essential and significant service of integrating each of the inputs of ~~our~~the completed solution. These inputs include our smart network infrastructure and IGUs, both of which are integrated into the window glazing system, which is fabricated by an unrelated subcontractor contracted by us to work on our behalf, as well as designing how the entire Smart Building Platform will be integrated and installed into the customer’s architectural specifications for the building that is being constructed or retrofitted. Our integration services also include the activities of installing, commissioning, and testing the Smart Building Platform to enable the transfer of a complete and operational system. We also use subcontractors we select and hire for portions of the installation labor. Given that ~~our responsibility~~View is ~~to provide~~responsible for providing the service of integrating each of the inputs into a single combined output, ~~we control~~View controls that output before it is transferred to the customer and accordingly, ~~we are~~View is the principal in the arrangement and will recognize the entire arrangement fee as its revenue, with any fees that ~~we pay~~View pays to ~~our~~its subcontractors recognized in ~~our~~its cost of revenue.

The pricing for a Smart Building Platform project is primarily driven by the make-up, size, shape, total units of the IGU, associated CSS, and costs associated with the management and performance of system design, fabrication, unitization, and installation efforts. We assume the risk of delivery and performance of the Smart Building Platform to our customer, and manage this through three key elements to ensure a pleasant end-user experience: 1) we have a contractual right and obligation to direct the activities of the subcontractors; 2) we perform quality inspections; and 3) we engage qualified personnel to protect our interest and direct the actions of the subcontractors. The end product to the customer is a single-solution Smart Building

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~~Platform that uses artificial intelligence to adjust the building environment to improve occupant health and productivity, as well as reduce building energy usage and carbon footprint.~~

~~We recognize~~Our View Smart Building Platform contracts to deliver a fully installed and functioning smart window curtain wall platform are typically considered one performance obligation that is satisfied as construction progresses. We recognize revenue over time as we provide services to satisfy our performance obligation. These contracts are typically long-term in nature and services are ~~performed~~provided over an extended period, transcending multiple financial reporting periods.

We determine the transaction price based on the consideration expected to be received, which is the contract price. When the contract contains payment terms that are extended beyond one year or other financing arrangements in conjunction with the contract, a significant financing component may exist. In such cases, we adjust the contract price at an amount that reflects the cash selling price. Payment terms may vary but are generally net 30 days from request for payment.

We recognize revenue over time using a cost-to-cost input method where progress on the performance obligation is measured by the proportion of actual costs incurred to the total costs expected to complete the contract. Recognizing revenue using a cost-to-cost input method provides an objective measure of progress and thereby best depicts the extent of transfer of control to the customer. Management judgment is required to estimate the progress towards completion. Significant changes in this estimate could affect the profitability of our contracts. Changes to estimated profit on contracts are recognized using a cumulative catch-up adjustment which recognizes in the current period the cumulative effect of the changes on current and prior periods based on a contract’s progress towards fulfillment of the performance obligation. When the total estimated costs to be incurred for a contract exceed the transaction price, an accrual for the loss on the contract is recognized as cost of revenue in the period the contract is signed, and adjusted periodically as estimates are revised. As actual costs are incurred that are in excess of revenue recognized, they are recorded against the loss accrual, which is therefore reduced.

InView Smart Glass

We also generate revenue as a materials provider from the ~~course~~(i) manufacturing and sale of ~~providing~~View Smart Glass IGUs and (ii) selling the View Smart ~~Building Platform, we routinely engage subcontractors we select~~Glass CSS components that when combined with the IGUs, enable the IGUs to tint. View Smart Glass CSS revenue also includes a system design document that lays out the design of the IGUs and CSS components and a commissioning service in which the installed IGUs and CSS components are tested, and tinting configurations are set by us. Smart Glass products are designed and fabricated by us in order to meet the building-site specifications of the end user, which is typically the owner, tenant or developer of buildings. When the end user approves of the use of our products, a non-binding letter of understanding with the owner, tenant or developer is signed.

We subsequently enter into the legally enforceable supplier contracts with our customers, which are typically glaziers for ~~fabricating~~IGUs and ~~unitizing~~low-voltage electricians (“LVE”) or General Contractors (“GC”) for CSS, to deliver the ~~specific smart glass~~Smart Glass products and services. The glaziers and LVEs are both subcontracted by the end user and are responsible for the design of the integrated platform, as well as assembly and installation of the IGUs and the CSS electrical components. As such, for this product offering, we serve as a materials provider to our customers and do not have a role in the assembly nor the installation of the framed IGUs. We enter into separate legally binding agreements with both the glazier and the LVE or GC, who are unrelated parties and therefore such contracts cannot be combined and accounted for as a single contract. We perform a commissioning service under the CSS contract after our customers have completed installation of the IGUs and ~~smart building infrastructure components~~CSS electrical components.

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Contracts with glaziers for IGUs include the promise to provide multiple customized IGUs. Each IGU represents a distinct and ~~incur~~separate single performance obligation as the customer can benefit from each unit on its own. Each unit is separately identifiable and does not modify or customize other ~~direct costs.~~units. We determine the transaction price based on the consideration expected to be received, which is generally the contractual selling price. Since the IGUs are ~~responsible~~customized to meet the building-site specifications of the ultimate end customer and have no alternative use to us and we have contractually enforceable rights to proportionate payment of the transaction price for performance completed to date, we recognize revenue over time as each IGU is manufactured using a cost-to-cost input method. Recognizing revenue using a cost-to-cost input method best depicts the Company’s performance in transferring control of the IGUs to the customer.

Contracts to deliver CSS to the customer, typically LVEs or GCs, contain multiple performance obligations for each promise in the CSS arrangement which is capable of being distinct and is separately identifiable in the context of the contract. This assessment requires management to make judgments about the individual promised good and service and whether each good and service is separable from the other goods and services in the contract. We determine the transaction price based on the consideration expected to be received, which is generally the contractual selling price. We allocate the transaction price to each performance obligation based on the relative standalone selling price (“SSP”). Management judgment is required in determining the SSP for contracts that contain products and services for which revenue is recognized both over time and at a point in time, and where such revenue recognition transcends multiple financial reporting periods due to the timing of delivery of such products and services. SSP is estimated based on the price at which the performance obligation is sold separately. We recognize revenue allocated to each performance obligation at the time the related performance obligation is satisfied by transferring control of the ~~entire~~promised good or service to a customer. For the control panels and electrical components, transfer of control generally occurs at a point in time upon shipment or delivery of the product and revenue is recognized upon shipment. For the system design, transfer of control generally occurs upon customer acceptance and revenue is recognized upon customer acceptance. For the commissioning services, which have a relatively short period of time over which the services are provided, transfer of control generally occurs upon acceptance of the installed products by the end user and revenue is recognized upon customer acceptance.

When the contract ~~including subcontracted work. Thus,~~contains payment terms that are extended beyond one year or we ~~may be subject to increased costs associated~~enter into loan or financing arrangement in conjunction with the ~~failure~~contract, a significant financing component may exist. In such cases, we adjust the contract price at an amount that reflects the cash selling price. We use a discount rate representing a borrowing rate as if a separate financing transaction been entered between the two parties based on the customer’s creditworthiness.

In limited circumstances, we contract to provide extended or enhanced warranties of ~~one~~our products outside of the terms of its standard assurance warranty, which are recognized as revenue over the respective term of the relevant extended or ~~more subcontractors to perform as anticipated.~~enhanced warranty period.

View Smart Building Technologies

~~Our~~View Smart Building Technologies ~~offering~~ includes a suite of products that can be either integrated into the View Smart Building Platform, added-on to View Smart Glass contracts or sold separately. These products, collectively referred to under the umbrella name “The Smart Building Cloud”, include the View Secure Edge, View Remote Access, View Building Performance, and View Workplace Experience products related to our acquisition of ioTium and WorxWell during 2021. Our customers are typically the owners or tenants of buildings. ~~Revenue generated from these products has not been material to date.~~

Some of our View Smart Building Technologies contracts offer software as a service pricing, which includes the use of our software applications, as a service, typically billed on a monthly or annual basis. ~~Our~~The Company’s contracts associated with these products, including implementation, support, and other services, represent a single promise to provide continuous access to ~~our~~its software solutions and their processing capabilities in the form of a service. Revenue on these services is recognized over the contract period. ~~Revenue recognized for these contracts has not been material to date.~~

Cost of Revenue

Cost of revenue consists primarily of the costs to manufacture and source our products, including the costs of materials, customer support, outside services, shipping, personnel expenses including salaries and related personnel expenses and stock-based compensation expense, equipment and facility expenses including depreciation of manufacturing equipment, rent and utilities, and insurance and taxes, warranty costs, and inventory valuation provisions.

The primary factor that impacts our cost of revenue as a percentage of revenues is the significant base operating costs that we incur as a result of our investment in manufacturing capacity to provide for future demand. At current production volume, these significant base operating costs result in higher costs to manufacture each IGU when compared to the sales price per IGU. As demand for our products increases and we achieve higher production yields, our cost of revenue as a percentage of revenue will decrease. Additional factors that impact our cost of revenue as a percentage of revenues include manufacturing efficiencies, cost of material, and mix of products. We expect to continue to incur significant base operating costs that will be absorbed over larger volumes of production as we scale our business. Following the restructuring plan discussed in Note 11 of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1, we have reduced certain of these base operating costs as we focus on the profitability of our business.

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Cost of revenues also includes the cost of subcontractors engaged to fabricate and unitize the specific smart glass products and for installation of IGUs and smart building infrastructure components. Further, and in contrast to View Smart Glass contracts in which losses associated with IGUs are recognized over time, our cost of revenue for our Smart Building Platform contracts includes the recognition of contract losses recorded upfront at contract execution within an initial loss accrual when the total current estimated costs for these contracts exceeds total contracted revenue. Revenue for these contracts is recognized as progress is made toward fulfillment of the performance obligation and cost of revenue is recognized equal to the revenue recognized. Actual costs incurred in excess of the revenue recognized are recorded against the initial loss accrual, which is then reduced. Given the growing nature of our business, we incur significant base operating costs attributable to our IGU production costs, which is a significant factor to the losses on these contracts. As we continue to ramp up our manufacturing volumes, we expect to absorb these base operating costs over larger volumes of production; therefore, we expect that the contract loss for individual contracts will decrease over time as a percentage of the total contract value. These economies of production have not been realized to date and the total amount of contract losses may not decrease in the near term as we continue to grow ~~this~~our business.

Research and Development Expenses

Research and development expenses consist primarily of costs related to research, design, maintenance, and enhancements of our products, including software ~~which~~that are expensed as incurred. Research and development expenses consist primarily of costs incurred for salaries and related personnel expenses, including stock-based compensation expense, for personnel related to the development of improvements and expanded features for our products, materials and supplies used in development and testing, payments to consultants, outside manufacturers, patent related legal costs, facility costs and depreciation. With the

~~Table~~ completed launch and ramp of ~~Conte~~n t s

~~recent completion~~our fourth-generation smart glass product and our Smart Building Platform product, as well as the launch of ~~certain projects~~new product offerings in our Smart Building Technologies behind us, we have recently determined to reduce the level of spend in research and development as we focus on ~~operational efficiencies,~~the profitability of our business as part of our restructuring plan discussed in Note 11 of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1. As such, we ~~expect that~~anticipate a reduction in our research and development expenses ~~will begin~~during 2023 as compared to ~~decrease as a percentage of revenue as our business grows.~~prior periods.

Selling, General and Administrative Expenses

Selling, general, and administrative expenses consist primarily of salaries and related personnel expenses, including stock-based compensation, costs related to sales and marketing, finance, legal and human resource functions, contractor and professional services fees, audit and compliance expenses, insurance costs, advertising and promotional expenses and general corporate expenses, including facilities and information technology expenses.

We expect our selling, general, and administrative expenses to ~~reflect an increase~~decrease in absolute dollars ~~for~~in 2023 following our restructuring plan discussed in Note 11 of the ~~full year of 2022,~~“Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1, as we ~~have scaled headcount~~aim to ~~grow~~right-size the business while focusing our presence in key geographies to support our customers and growing business, and as a result of operating as a public company, including compliance with the rules and regulations of the SEC and Nasdaq, legal, audit, higher expenses for directors and officer insurance, investor relations activities, and other administrative and professional services. In future periods,grow our business. Over time, we expect our selling, general and administrative expenses to decline as a percentage of revenue as we ~~have~~leverage these costs.

Restructuring Costs

Restructuring costs consist of severance and related costs, as well as costs incurred to relocate certain long-lived assets from our headquarters to our manufacturing facility, which are associated with the ~~infrastructure~~restructuring plan discussed in ~~place~~Note 11 of the “Notes to ~~support our growing business.~~Condensed Consolidated Financial Statements” included in Part I, Item 1.

Interest Expense, Net

Interest expense, net consists primarily of interest paid on our debt facilities and amortization of debt discounts and issuance costs, ~~during the first quarter~~net of ~~fiscal year 2021,~~ interest ~~paid on our finance leases and interest~~income primarily received or earned on our cash, ~~and~~ cash equivalents and short-term investment balances.

Other Expense (Income), Net

Other expense, ~~(income),~~ net primarily consists of penalties we expect to incur for the ~~proposed~~ settlement of an environmental matter in 2021, ~~and~~ foreign exchange gains and ~~losses.~~losses, and realized gains and losses from the sale of short-term investments.

Gain on Fair Value Change, Net

Our Sponsor Earn-out Shares and Private Warrants ~~and redeemable convertible preferred stock warrants~~ are ~~or were~~ subject to remeasurement to fair value at each balance sheet date. Changes in fair value as a result of the remeasurement are recognized in gain on fair value change, net in the ~~condensed~~ consolidated statements of ~~comprehensive loss. The redeemable convertible preferred stock warrants were converted to common stock as a result of the Merger.~~operations. We will continue to adjust the remaining outstanding instruments for changes in fair value until the Earn-Out Triggering Events are met, ~~which is~~ the earlier of the exercise or expiration of the Warrants.

~~Loss on Extinguishment~~

Table of ~~Debt~~Contents

~~Loss on extinguishment of debt comprises a loss arising from the extinguishment of debt as a result of repayment in full of our revolving debt facility in the first quarter of 2021.~~

Provision ~~(benefit)~~ for Income Taxes

Our provision ~~(benefit)~~ for income taxes consists of an estimate of federal, state, and foreign income taxes based on enacted federal, state, and foreign tax rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in tax law. Due to the level of historical losses, we maintain a valuation allowance against U.S. federal and state deferred tax assets as we have concluded it is more likely than not that these deferred tax assets will not be realized.

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Results of Operations

The following table sets forth our historical operating results for the periods indicated (in thousands, except percentages):

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 2022 2021
Amount % of Revenue Amount % of Revenue Amount % of Revenue Amount % of Revenue
Revenue $ 23,762 100.0 % $ 18,884 100.0 % $ 57,090 100.0 % $ 45,579 100.0 %
Costs and expenses:
Cost of revenue 49,126 206.7 % 51,828 274.5 % 129,219 226.3 % 137,617 301.9 %
Research and development 15,554 65.5 % 36,314 192.3 % 56,157 98.4 % 73,924 162.2 %
Selling, general, and administrative 41,174 173.3 % 38,210 202.3 % 124,888 218.8 % 94,543 207.4 %
Total costs and expenses 105,854 445.5 % 126,352 669.1 % 310,264 543.5 % 306,084 671.5 %
Loss from operations (82,092) (345.5) % (107,468) (569.1) % (253,174) (443.5) % (260,505) (571.5) %
Interest and other expense (income), net
Interest expense, net 58 0.2 % 287 1.5 % 324 0.6 % 5,906 13.0 %
Other expense (income), net 118 0.5 % (100) (0.5) % 259 0.5 % 6,320 13.9 %
Gain on fair value change, net (226) (1.0) % (13,078) (69.3) % (6,511) (11.4) % (18,426) (40.4) %
Loss on extinguishment of debt — — % — — % — — % 10,018 22.0 %
Interest and other (income) expense, net (50) (0.2) % (12,891) (68.3) % (5,928) (10.4) % 3,818 8.4 %
Loss before provision (benefit) of income taxes (82,042) (345.3) % (94,577) (500.8) % (247,246) (433.1) % (264,323) (579.9) %
Provision (benefit) for income taxes 23 0.1 % (425) (2.3) % 77 0.1 % (416) (0.9) %
Net and comprehensive loss $ (82,065) (345.4) % $ (94,152) (498.6) % $ (247,323) (433.2) % $ (263,907) (579.0) %


	Three Months Ended June 30,								Six Months Ended June 30,
	2023				2022				2023				2022
	Amount		% of net sales		Amount		% of net sales		Amount		% of net sales		Amount		% of net sales
Revenue	$	28,034	100.0	%	$	16,316	100.0	%	$	46,382	100.0	%	$	33,328	100.0	%
Cost of revenue	41,810		149.1	%	39,531		242.3	%	82,023		176.8	%	80,093		240.3	%
Gross loss	(13,776)		(49.1	%)	(23,215)		(142.3	%)	(35,641)		(76.8	%)	(46,765)		(140.3	%)
Operating expenses:
Research and development	9,714		34.7	%	20,908		128.1	%	22,655		48.8	%	40,603		121.8	%
Selling, general, and administrative	23,511		83.9	%	40,755		249.8	%	48,911		105.5	%	83,714		251.2	%
Impairment of note receivable	4,000		14.3	%	—		—	%	4,000		8.6	%	—		—	%
Restructuring costs	1,258		4.5	%	—		—	%	5,507		11.9	%	—		—	%
Total operating expenses	38,483		137.3	%	61,663		377.9	%	81,073		174.8	%	124,317		373.0	%
Loss from operations	(52,259)		(186.4	%)	(84,878)		(520.2	%)	(116,714)		(251.6	%)	(171,082)		(513.3	%)
Interest and other expense (income), net:
Interest expense, net	3,970		14.2	%	69		0.4	%	7,131		15.4	%	266		0.8	%

Other expense (income), net	119		0.4	%	(187)		(1.1	%)	281		0.6	%	141		0.4	%
Gain on fair value change, net	(6)		—	%	(1,904)		(11.7	%)	(513)		(1.1	%)	(6,285)		(18.9	%)

Interest and other expense (income), net	4,083		14.6	%	(2,022)		(12.4	%)	6,899		14.9	%	(5,878)		(17.6	%)
Loss before provision of income taxes	(56,342)		(201.0	%)	(82,856)		(507.8	%)	(123,613)		(266.5	%)	(165,204)		(495.7	%)
Provision for income taxes	18		0.1	%	30		0.2	%	36		0.1	%	54		0.2	%
Net and comprehensive loss	$	(56,360)	(201.0	%)	$	(82,886)	(508.0	%)	$	(123,649)	(266.6	%)	$	(165,258)	(495.9	%)

Revenue

The following table presents our revenue by major product offering (in thousands, except percentages):


		Three Months Ended September 30,										Nine Months Ended September 30,											Three Months Ended June 30,										Six Months Ended June 30,
		2022			2021			Change ($)		Change (%)		2022			2021			Change ($)		Change (%)			2023			2022			Change ($)		Change (%)		2023			2022			Change ($)		Change (%)
Smart Building Platform	Smart Building Platform	$	11,317		$	9,876		$	1,441	14.6	%	$	29,578		$	15,012		$	14,566	97.0	%	Smart Building Platform	$	18,012		$	9,055		$	8,957	98.9	%	$	28,656		$	18,261		$	10,395	56.9	%
Percentage of total revenue	Percentage of total revenue	47.6		%	52.3		%					51.8		%	32.9		%					Percentage of total revenue	64.3		%	55.5		%					61.8		%	54.8		%
Smart Glass	Smart Glass	10,320			8,410			1,910		22.7	%	19,809			28,205			(8,396)		(29.8)	%	Smart Glass	7,721			4,306			3,415		79.3	%	12,373			9,489			2,884		30.4	%
Percentage of total revenue	Percentage of total revenue	43.4		%	44.5		%					34.7		%	61.9		%					Percentage of total revenue	27.5		%	26.4		%					26.7		%	28.5		%
Smart Building Technologies	Smart Building Technologies	2,125			598			1,527		255.4	%	7,703			2,362			5,341		226.1	%	Smart Building Technologies	2,301			2,955			(654)		(22.1	%)	5,353			5,578			(225)		(4.0	%)
Percentage of total revenue	Percentage of total revenue	8.9		%	3.2		%					13.5		%	5.2		%					Percentage of total revenue	8.2		%	18.1		%					11.5		%	16.7		%
Total	Total	$	23,762		$	18,884		$	4,878	25.8	%	$	57,090		$	45,579		$	11,511	25.3	%	Total	$	28,034		$	16,316		$	11,718	71.8	%	$	46,382		$	33,328		$	13,054	39.2	%

4237

Table of ~~Conte~~n t sContents

The following table presents our revenue by geographic area and is based on the shipping address of the customers (in thousands, except percentages):


		Three Months Ended September 30,										Nine Months Ended September 30,											Three Months Ended June 30,										Six Months Ended June 30,
		2022			2021			Change ($)		Change (%)		2022			2021			Change ($)		Change (%)			2023			2022			Change ($)		Change (%)		2023			2022			Change ($)		Change (%)
United States	United States	$	21,743		$	15,682		$	6,061	38.6	%	$	52,852		$	37,400		$	15,452	41.3	%	United States	$	25,919		$	14,825		$	11,094	74.8	%	$	42,969		$	31,109		$	11,860	38.1	%
Percentage of total revenue	Percentage of total revenue	91.5		%	83.0		%					92.6		%	82.1		%					Percentage of total revenue	92.5		%	90.9		%					92.6		%	93.3		%
Canada	Canada	2,009			2,968			(959)		(32.3)	%	4,170			7,475			(3,305)		(44.2)	%	Canada	2,115			1,443			672		46.6	%	3,413			2,161			1,252		57.9	%
Percentage of total revenue	Percentage of total revenue	8.5		%	15.7		%					7.3		%	16.4		%					Percentage of total revenue	7.5		%	8.8		%					7.4		%	6.5		%
Other	Other	10			234			(224)		(95.7)	%	68			704			(636)		(90.3)	%	Other	—			48			(48)		(100.0	%)	—			58			(58)		(100.0	%)
Percentage of total revenue	Percentage of total revenue	—		%	1.2		%					0.1		%	1.5		%					Percentage of total revenue	—		%	0.3		%					—		%	0.2		%
Total	Total	$	23,762		$	18,884		$	4,878	25.8	%	$	57,090		$	45,579		$	11,511	25.3	%	Total	$	28,034		$	16,316		$	11,718	71.8	%	$	46,382		$	33,328		$	13,054	39.2	%

Our revenue totaled ~~$23.8~~$28.0 million during the three months ended ~~September~~June 30, ~~2022,~~2023, a ~~25.8%~~71.8% increase from ~~$18.9~~$16.3 million during the three months ended ~~September~~June 30, ~~2021.~~2022. Our revenue totaled $46.4 million during the six months ended June 30, 2023, a 39.2% increase from $33.3 million during the six months ended June 30, 2022. The ~~increase~~increases during the three and six months ended ~~September~~June 30, ~~2022~~2023 compared to the same ~~period~~periods in the prior year ~~was~~were primarily due to ~~an increase in Smart Glass revenues driven by work completed in the third quarter of the current year associated with several larger projects,~~ an increase in Smart Building Platform revenues driven by a continued shift in new projects from our Smart Glass offering to this ~~new~~ offering, ~~introduced in the second quarter~~reflective of ~~2021, and an~~a continued increase in ~~Smart Building Technologies revenues primarily driven by~~market awareness of our products, repeat purchases from existing customers indicative of the ~~WorxWell~~quality and value of our products, ~~acquired~~and our shift in ~~November 2021.~~

~~Our revenue totaled $57.1 million during~~focus to the ~~nine months ended September 30, 2022, a 25.3% increase from $45.6 million in the nine months ended September 30, 2021.~~multi-family residential market which continues to experience strong demand. The increase in ~~the nine months ended September 30, 2022 compared to the same period in the prior year was primarily~~our Smart Glass revenues is driven by a product mix shift within this offering to our higher priced CSS products, as we have fewer early-stage Smart Glass projects with IGUs in production following the shift to ~~the new View~~ Smart Building Platform offering introduced in the second quarter of 2021 and new Smart Building Technologies products, including the products acquired in the second half of 2021. The decline in Smart Glass revenues in the first nine months of 2022 is attributable to our customer's decisions to select the newly offered Smart Building Platform offering rather than Smart Glass offering, as well as the timing of new Smart Glass projects.Platform.

Costs and Expenses

Cost of Revenue

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 Change ($) Change (%) 2022 2021 Change ($) Change (%)
Cost of revenue $ 49,126 $ 51,828 $ (2,702) (5.2) % $ 129,219 $ 137,617 $ (8,398) (6.1) %


	Three Months Ended June 30,								Six Months Ended June 30,
	2023		2022		Change ($)		Change (%)		2023		2022		Change ($)		Change (%)
Cost of revenue	$	41,810	$	39,531	$	2,279	5.8	%	$	82,023	$	80,093	$	1,930	2.4	%

Cost of revenue totaled ~~$49.1~~$41.8 million, or ~~206.7%~~149.1% of net sales during the three months ended ~~September~~June 30, ~~2022,~~2023, compared to ~~$51.8~~$39.5 million, or ~~274.5%~~242.3% of net sales during the three months ended ~~September~~June 30, ~~2021.~~2022. Cost of revenue totaled ~~$129.2~~$82.0 million, or ~~226.3%~~176.8% of net sales induring the ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, compared to ~~$137.6~~$80.1 million, or ~~301.9%~~240.3% of net sales induring the ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022. The cost of revenue decreases as a percentage of ~~revenues~~net sales during these periods ~~reflect~~reflects the benefit of leveraging the minimum operating costs in the factory over higher revenues and favorable product mix across the three major product ~~offerings and lower levels of contract loss accruals.~~offerings.

The ~~$2.7~~$2.3 million ~~decrease~~increase in cost of revenue in absolute dollars during the three months ended ~~September~~June 30, ~~2022~~2023 compared to the same period in the prior year was primarily driven by:

•a ~~$8.8~~$6.0 million ~~decrease in new contract loss accruals,~~increase to estimated costs to complete Smart Building Platform projects,

•$~~1.4~~4.8 million of ~~lower levels of inventory impairments for raw materials, and~~

•~~a $0.9 million decrease in stock-based compensation expense.~~

~~These decreases were partially offset by:~~

•~~$5.7 million of~~ increased to subcontractor costs used for the delivery of the Smart Building Platform product due to revenue increases in this product offering,

•~~$1.0~~a $1.6 million ~~of increased smart window product costs associated with the higher revenues.~~

~~Factory operating costs were relatively flat for the third quarter of 2022 as compared~~increase due to the ~~third quarter of 2021, as favorable~~volume increase in Smart Glass revenues, and

•a $1.0 million increase in new contract loss accruals.

These increases were partially offset by:

•a $4.8 million decrease in factory operating costs resulting from cost savings initiatives ~~were mostly offset by higher production requirements.~~

~~The $8.4 million decrease~~put in place during late 2022 and the ~~cost~~restructuring put in place at the end of ~~revenue in absolute dollars during~~ the ~~nine months ended September 30, 2022 compared to the same period in the prior year was primarily driven by:~~first quarter of 2023,

•~~a $20.5~~$4.7 million ~~decrease in new contract loss accruals,~~

~~Table~~ of ~~Conte~~n t slower levels of inventory impairments for raw materials and produced finished goods that were not sold at period end, and

•~~an increase~~$2.2 million of ~~$4.8 million for the~~increased usage of previously recorded contract loss accruals for actual costs incurred in excess of the revenue recognized, which offsets actual costs incurred in the production and delivery of the Smart Building Platform product for the amount incurred in excess of revenues ~~recognized,~~recognized.

Cost of revenue for the three months ended June 30, 2023 and 2022 each included $0.3 million of stock-based compensation expense.

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The $1.9 million increase in cost of revenue in absolute dollars during the six months ended June 30, 2023 compared to the same period in the prior year was primarily driven by:

•a ~~$5.1~~$4.6 million ~~reduction in post-installation customer support~~increase to estimated costs ~~primarily due~~ to a $4.8 million charge recorded in the first half of 2021 in connection with specific performance obligations promised to customers in connection with IGU failures associated with the previously discussed quality issue,

•~~approximately $2.6 million of lower levels of smart window product costs due to lower revenues,~~

•~~approximately $2.8 million lower materials costs due to favorable factory yields,~~

•~~a $2.3 million decrease in stock-based compensation expense,~~complete View Smart Building Platform projects, and

•~~cumulative catch-up adjustments to reduce previously recorded contract loss accruals of $1.4 million.~~

~~These decreases were partially offset by:~~

•$~~7.5 million of increased factory operating costs as we scaled our factory capacity in the second half of 2021 resulting in higher costs in the first half of 2022 as compared to the first half of 2021,~~

•~~$16.4~~10.2 million of increased subcontractor costs used for the delivery of the Smart Building Platform product due to ~~higher volumes~~revenue increases in this product offering.

These increases were partially offset by:

•a $6.9 million decrease in factory operating costs resulting from cost savings initiatives put in place during 2022 and the ~~current year,~~first half of 2023, and

•$~~7.9~~6.3 million of ~~higher~~lower levels of inventory impairments for raw materials and produced finished goods that were not sold at period end.

Cost of revenue for the ~~three~~six months ended ~~September~~June 30, 2023 and 2022 ~~and 2021~~ included ~~$0.4 million and $1.3~~$0.7 million of stock-based compensation ~~expense, respectively. Cost of revenue for the nine months ended September 30, 2022 and 2021 included $1.1 million and $3.5 million of stock-based compensation expense, respectively.~~expense.

Research and Development

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 Change ($) Change (%) 2022 2021 Change ($) Change (%)
Research and development $ 15,554 $ 36,314 $ (20,760) (57.2) % $ 56,157 $ 73,924 $ (17,767) (24.0) %


	Three Months Ended June 30,								Six Months Ended June 30,
	2023		2022		Change ($)		Change (%)		2023		2022		Change ($)		Change (%)
Research and development	$	9,714	$	20,908	$	(11,194)	(53.5	%)	$	22,655	$	40,603	$	(17,948)	(44.2	%)

Research and development expenses decreased ~~$20.8~~$11.2 million during the three months ended ~~September~~June 30, ~~2022~~2023 compared to the same period in the prior year, primarily related to ~~a $15.1 million reduction in depreciation expense primarily due to certain assets that were abandoned and written off in the third quarter of 2021. The remaining decrease related to $2.8~~an approximately $6 million reduction in costs for ~~existing~~ projects related to our IGU product and manufacturing processes ~~which were completed prior to the third quarter of 2022~~ and ~~$2.3~~an approximately $4 million reduction in costs for development and enhancement of Smart Building Technology ~~development and enhancement~~ projects ~~that have~~either completed during 2022 or not ~~been~~ commercialized as part of planned cost reductions, ~~for cash conservation.~~as well as other cost savings initiatives.

Research and development expenses decreased ~~$17.8~~$17.9 million during the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 compared to the same period in the prior year, primarily related to ~~a $17.5~~an approximately $10 million reduction in ~~depreciation expense~~costs for ~~certain assets abandoned~~projects related to our IGU product and ~~written off~~manufacturing processes and an approximately $7 million reduction in the second and third quarters of 2021 and a $2.6 million decrease in stock-based compensation expense, partially offset by a $2.5 million increase due to higher spending on the enhancement of existing products andcosts for development and enhancement of Smart Building Technology ~~products.~~projects either completed during 2022 or not commercialized as part of planned cost reductions, as well as other cost savings initiatives.

Research and development expenses for the three months ended ~~September~~June 30, 2023 and 2022 ~~and 2021~~ included ~~$2.0~~$1.0 million and ~~$2.7~~$1.5 million of stock-based compensation expense, respectively. Research and development expenses for the ~~nine~~six months ended ~~September~~June 30, 2023 and 2022 ~~and 2021~~ included ~~$3.6~~$2.2 million and ~~$6.2~~$1.6 million of stock-based compensation expense, respectively.

Selling, General, and Administrative

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 Change ($) Change (%) 2022 2021 Change ($) Change (%)
Selling, general and administrative $ 41,174 $ 38,210 $ 2,964 7.8 % $ 124,888 $ 94,543 $ 30,345 32.1 %


	Three Months Ended June 30,								Six Months Ended June 30,
	2023		2022		Change ($)		Change (%)		2023		2022		Change ($)		Change (%)
Selling, general and administrative	$	23,511	$	40,755	$	(17,244)	(42.3	%)	$	48,911	$	83,714	$	(34,803)	(41.6	%)

Selling, general, and administrative expenses ~~increased $3.0~~decreased $17.2 million during the three months ended ~~September~~June 30, ~~2022~~2023 compared to the same period in the prior year, primarily due to ~~$6.9~~an approximately $7 million decrease in legal and accounting expenses for costs incurred in 2022 related to the restatement of ~~stock-based compensation expense recorded~~the Company's financial statements included in its Annual Report on Form 10-K for the ~~modification of Officer RSUs, offset by a $4.6~~years ended December 31, 2021, 2020 and 2019 and the Quarterly Report on Form 10-Q/A for the three months ended March, 31 2021 and 2020, and other related work, an approximately $7 million decrease ofin stock-based compensation expense due to higher levels of ~~amortization~~expense recognized in the prior year due to the required use of an accelerated amortization method, ~~while other spending was held relatively flat.~~

~~Table of Conte~~n t s

and an approximately $3 million decrease in sales and marketing expenses resulting from cost savings initiatives.

Selling, general, and administrative expenses ~~increased $30.3~~decreased $34.8 million during the ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 compared to the same period in the prior year, primarily due to an ~~increase of~~ approximately ~~$13.4~~$13 million ofdecrease in legal, consulting and accounting expenses ~~during~~for costs incurred in 2022 related to ~~assist in~~ the restatement of the Company's financial statements included in ~~our recently filed~~its Annual Report on Form 10-K for the years ended December 31, 2021, 2020 and 2019 and the Quarterly Report on Form 10-Q/A for the three months ended March, 31 2021 and 2020, and other related work, ~~a $8.6~~an approximately $14 million ~~increase~~decrease in stock-based compensation expense due to higher levels of expense recognized in the prior year due to the required use of an accelerated amortization method, and an approximately $6 million decrease in sales and marketing expenses resulting from the CEO Option Awards, Officer RSUs and Officer Options granted as part of the Merger, and a $4.7 million increase in the first half of 2022 for employee compensation and benefits associated with an increase in headcount, particularly as it relates to sales support for our growing business and additional finance resources necessary as a result of operating as a public company.cost savings initiatives.

Selling, general, and administrative expenses for the three months ended ~~September~~June 30, 2023 and 2022 ~~and 2021~~ included ~~$20.8~~$9.4 million and ~~$18.5~~$16.3 million of stock-based compensation expense, respectively. Selling, general, and administrative expenses for the ~~nine~~ six

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months ended ~~September~~June 30, 2023 and 2022 ~~and 2021~~ included ~~$54.1~~$19.0 million and ~~$45.5~~$33.3 million of stock-based compensation expense, respectively.

Restructuring Costs


	Three Months Ended June 30,							Six Months Ended June 30,
	2023		2022	Change ($)		Change (%)		2023		2022	Change ($)		Change (%)
Restructuring Costs	$	1,258	—	$	1,258	100.0	%	$	5,507	—	$	5,507	100.0	%

Restructuring costs were $1.3 million during the three months ended June 30, 2023 primarily for the relocation of certain long-lived assets associated with our R&D equipment from our headquarters to our manufacturing facility, or the abandonment of certain other long-lived assets associated with our R&D equipment. Restructuring costs were $5.5 million during the six months ended June 30, 2023 primarily for employee severance and other costs for employees impacted by the March 2023 restructuring plan, along with the long-lived asset relocation costs. No restructuring costs were incurred during the three and six months ended June 30, 2022.

Interest and Other Expense (Income), net

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 Change ($) Change (%) 2022 2021 Change ($) Change (%)
Interest expense, net $ 58 $ 287 $ (229) (79.8) % $ 324 $ 5,906 $ (5,582) (94.5) %
Other expense (income), net 118 (100) 218 (218.0) % 259 6,320 (6,061) (95.9) %
Gain on fair value change, net (226) (13,078) 12,852 (98.3) % (6,511) (18,426) 11,915 (64.7) %
Loss on extinguishment of debt $ — $ — $ — * $ — $ 10,018 $ (10,018) *

*~~not meaningful~~


	Three Months Ended June 30,								Six Months Ended June 30,
	2023		2022		Change ($)		Change (%)		2023		2022		Change ($)		Change (%)
Interest expense, net	$	3,970	$	69	$	3,901	5,653.6	%	$	7,131	$	266	$	6,865	2,580.8	%
Other expense (income), net	119		(187)		306		(163.6	%)	281		141		140		99.3	%
Gain on fair value change, net	$	(6)	$	(1,904)	$	1,898	(99.7	%)	$	(513)	$	(6,285)	$	5,772	(91.8	%)

Interest Expense, Net

Interest expense, net ~~decreased $0.2~~increased $3.9 million and ~~$5.6~~$6.9 million during the three and ~~nine~~six months ended ~~September~~June 30, ~~2022, respectively,~~2023, compared to the same ~~periods~~period in the prior year primarily due tointerest expense on the ~~full repayment of the revolving debt facility at Closing~~Convertible Notes that were issued during the ~~first~~fourth quarter of ~~2021, resulting~~2022, partially offset by an increase in ~~lower~~ interest ~~expense.~~income related to short-term investments initially purchased during the fourth quarter of 2022.

Other Expense (Income), Net

Other expense (income), net did not fluctuate materially during the three months and six months ended ~~September~~June 30, ~~2022~~2023 compared to the same ~~period~~periods the prior year. Other expense, net decreased by $6.1 million during the nine months ended September 30, 2022 compared to the same period in the prior year primarily due to $5.0 million of penalties incurred during the nine months ended September 30, 2021 in conjunction with the proposed settlement between View and the United States government to resolve claims and charges against View relating to our discharges of water into publicly owned treatment works without first obtaining a pretreatment permit. See ~~Note 7~~ ~~of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1. “Financial Statements (Unaudited)” for further discussion of this matter.~~

Gain on Fair Value Change, Net

The gain on fair value change, net during the three and six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021, as well as the nine months ended September 30,~~ 2022 was primarily related to changes in the fair value of our Sponsor Earn-Out liability. The gain on fair value change, net during the nine months ended September 30, 2021 also included the changes in the fair value of our redeemable convertible preferred stock warrants prior to their conversion in the first quarter of 2021.

~~Loss on extinguishment of debt~~

~~During the nine months ended September 30, 2021, we recorded a loss of $10.0 million on debt extinguishment related to the full repayment of the revolving debt facility at Closing.~~

Provision for Income Taxes

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2022~~2023 and ~~2021,~~2022, our income tax expense was immaterial.

Liquidity and Capital Resources

As of ~~September~~June 30, ~~2022,~~2023, we had ~~$51.3~~$30.1 million in cash and cash equivalents, $49.8 million in short-term investments and ~~$38.5~~$88.6 million in working capital. Our accumulated deficit totaled ~~$2,504.7~~$2,718.1 million as of ~~September~~June 30, ~~2022.~~2023. For the ~~nine~~six months ended ~~September~~June 30, 2023, we had a net loss of approximately $123.6 million and negative cash flows from operations of approximately $107.6 million. In addition, for the six months ended June 30, 2022, we had a net loss of approximately ~~$247.3~~$165.3 million and negative cash flows from operations of approximately ~~$204.2~~$153.2 million. In addition, for the nine months ended September 30, 2021, we had a net loss of approximately $263.9 million and negative cash flows from operations of approximately $188.7 million. As discussed further in ~~Note 14, we entered into an agreement on October 25, 2022 resulting in the sale of $200.0 million aggregate principal amount of Notes. In addition, we implemented~~

~~Table of Conte~~n t s

plans to reduce cash spend and increase cash collections during the third quarter of 2022, which resulted in a decrease of net cash outflow of $29.3 million, from $89.3 million for the three months ended June 30, 2022 to $60.0 million for the three months ended September 30, 2022. As of October 31, 2022, our cash and cash equivalents totaled approximately $228 million.

We have historically financed our operations through the issuance and sale of redeemable convertible preferred stock, the issuance of debt financing, the gross proceeds associated with the Merger and revenue generation from product sales. Our principal uses of cash in recent periods have been funding operations and investing in capital expenditures. Our future capital requirements will depend on many factors, including revenue growth rate, achieving profitability on our revenue contracts, the timing and the amount of cash received from customers, the expansion of sales and marketing activities, the timing and extent of spending to support research and development efforts, capital expenditures associated with our capacity expansion, the introduction of new products and the continuing market adoption of our products. Our business will require significant amounts of capital to sustain operations and we will need to make the investments we need to execute our long-term business plans.

Our total current liabilities as of September 30, 2022 are $89.1 million, including $10.4 million accrued as estimated loss on our Smart Building Platform contracts. Our long-term liabilities as of September 30, 2022 that will come due during the next 12 months from the date of the filing of this Quarterly Report on Form 10-Q include $1.0 million in operating and finance lease payments and $1.8 million in estimated settlements of warranty liabilities. In addition, as disclosed in ~~Note 8~~ of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1, we have an agreement with one customer that could result in up to $4.8 million additional issuance of cash under a promissory note over the next 12 months.

Due to the historical rate of cash outflows, we are not currently able to conclude that our existing cash and cash equivalents balance as of the date of this filing will be adequate to fund our forecasted operating costs and meet our obligations; we have therefore determined that there is substantial doubt about our ability to continue as a going ~~concern. While~~concern, as we ~~plan to continue to reduce cash outflow when compared to prior periods,~~estimate that our ~~ability~~available financial resources are adequate to fund our forecasted operating costs and meet our obligations into, but not beyond ~~twelve months from the date of this filing~~September 2023. This projection is ~~dependent upon~~based on our ~~ability to attain~~current expectations regarding revenues, collections, cost structure, current cash burn rate and ~~maintain profitable operations by entering into profitable sales contracts and generating sufficient~~other operating assumptions. To address its cash flow. We are evaluating the impact of the ITC available to our customers under the IRA passed by Congress and signed into law on August 16, 2022, which management expects to bring the cost of our products to cost parity with conventional windows. Management further expects a resulting increase in demand for our products, allowing us to leverage our minimum operating costs in the factory even further over higher revenues and make further progress towards our objective of profitable operations.

Ifneeds, we are ~~not able to achieve profitability prior to the depletion~~actively seeking additional sources of ~~our current cash and cash equivalents, we would be required to raise additional~~ capital. ~~While we have successfully raised additional capital during the current fiscal year,~~As there can be no assurance that ~~future~~such necessary financing will be available, we may execute other strategic alternatives to maximize stakeholder value, including further expense reductions, sale of all or portions of the business, corporate capital restructuring or formal reorganization, or liquidation of assets.

While we raised additional financing during 2022, there can be no assurance that the necessary additional financing will be available on terms acceptable to us, or at all. If we raise funds in the future by issuing equity securities, such as through the sale of our common stock under the common stock purchase agreements (the “Purchase Agreements”) discussed further in Note 8 of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1, dilution to stockholders will occur and may ~~result.~~be substantial. Any equity securities issued may also provide for rights, preferences, or privileges senior to those of holders

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of common stock. If we raise funds in the future by issuing additional debt securities, these debt securities could have rights, preferences, and privileges senior to those of preferred and common stockholders. The terms of any additional debt securities or borrowings could impose significant restrictions on our operations. The capital markets have experienced in the past, and may experience in the future, periods of upheaval that could impact the availability and cost of equity and debt financing. In addition, recent and anticipated future increases in federal fund rates set by the Federal Reserve, which serve as a benchmark for rates on borrowing, will continue to impact the cost of debt financing.

IfWe have historically financed our operations through revenue generation from product sales, the issuance and sale of redeemable convertible preferred stock, the issuance of debt financing, and the gross proceeds associated with the contribution of cash and the issuance of private investment in public equity (“PIPE”) in connection with the Company’s merger completed on March 8, 2021. As discussed further in Note 7 of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1, we ~~are unable to obtain adequate capital resources to fund operations, either through attaining and maintaining profitable operations or raising~~raised additional capital of $206.3 million, after deducting fees and offering expenses, during the fourth quarter of 2022 through the issuance of the Convertible Notes.

Our principal uses of cash in recent periods have been funding operations and investing in capital expenditures. Our future capital requirements will depend on many factors, including revenue growth rate, achieving profitability on our revenue contracts, the timing and the amount of cash received from customers, capital expenditures associated with our capacity expansion, and the continuing market adoption of our products. Our business will require significant amounts of capital to sustain operations and we ~~would not be able~~will require a significant amount of capital investments to ~~continue to operate~~execute our long-term business ~~pursuant to~~plans.

Our total current liabilities as of June 30, 2023 are $83.6 million, including $11.6 million accrued as estimated loss on our ~~current business plan, which would require us to modify our operations~~Smart Building Platform contracts. Our long-term liabilities as of June 30, 2023 that will come due during the next 12 months from the date of the filing of this Quarterly Report on Form 10-Q include $0.9 million in operating and finance lease payments and $1.1 million in estimated settlements of warranty liabilities.

In order to reduce ~~spending~~the cash used in operating activities, we implemented certain cost savings initiatives in the second half of 2022, as well as a restructuring plan in March 2023 as further discussed in Note 11 of the “Notes to ~~a sustainable level by, among other things, delaying, scaling back or eliminating some or all of~~Condensed Consolidated Financial Statements” included in Part I, Item 1. While our ~~ongoing or planned investments in corporate infrastructure, business development, sales and marketing, research and development and other activities, which would have a material impact on~~plans are anticipated to reduce cash outflow when compared to prior periods, our ~~operations and~~continued existence is dependent upon our ability to obtain additional financing, as well as to attain and maintain profitable operations by entering into profitable sales contracts and generating sufficient cash flow to meet our obligations on a timely basis. Further, we are continuing to evaluate the impact of the ITC available to our customers under the IRA passed by Congress and signed into law on August 16, 2022, which management expects to bring the cost of our products to cost parity with conventional windows. Management further expects a resulting increase in demand for our products, allowing us to leverage our minimum operating costs in the factory even further over higher revenues ~~or we may be forced to discontinue~~and make further progress towards our ~~operations entirely.~~objective of profitable operations.

Debt

6.00% / 9.00% Convertible Senior PIK Toggle Notes due 2027

In the fourth quarter of 2022, we completed a private placement of $212.3 million aggregate principal amount of Convertible Notes, which will mature on October 1, 2027. The net proceeds from the sale of the Convertible Notes were approximately $206.3 million, after deducting fees and estimated offering expenses. We intend to use the net proceeds from this sale for general corporate purposes.

The Convertible Notes bear interest at 6.00% per annum, to the extent paid in cash (“Cash Interest”), and 9.00% per annum, to the extent paid in kind through the issuance of additional Convertible Notes (“PIK Interest”). Interest is payable semi-annually in arrears on April 1 and October 1 of each year, beginning on April 1, 2023. The Convertible Notes are convertible, based on the applicable conversion rate, into cash, shares of the Company’s common stock or a combination thereof, at our election. The initial conversion rate was 12.46106 shares per $1,000.00 principal amount of the Convertible Notes, subject to customary anti-dilution adjustment in certain circumstances, which represented an initial conversion price of approximately $80.25 per share.

For additional information on the Convertible Notes, refer to Note 7 of the “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1.

Term Loan

As of ~~September~~June 30, ~~2022,~~2023, we had ~~$14.7~~$14.0 million outstanding under our term loan debt arrangement. On October 22, 2020, we entered into an amended and restated debt arrangement with the lender, which temporarily suspended the payments until June 30, 2022. Starting June 30, 2022, we are required to make semi-annual payments of $0.7 million through June 30, 2032. As of ~~September~~June 30, ~~2022, $1.5~~2023, $2.2 million of the outstanding amount under this arrangement has been classified as a current liability, and the remaining ~~$13.2~~$11.8 million has been classified as a long-term liability.

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The debt arrangement required us to invest certain amounts in land, building and equipment and create a certain number of jobs. As of ~~September~~June 30, ~~2022,~~2023, we had met the requirements. The debt arrangement, as amended, has customary affirmative and negative covenants. As of ~~September~~June 30, ~~2022,~~2023, we were in compliance with all covenants.

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Cash Flows

The following table provides a summary of cash flow data (in thousands):

Nine Months Ended September 30,
2022 2021
Net cash used in operating activities $ (204,201) $ (188,744)
Net cash used in investing activities (19,556) (20,357)
Net cash provided by (used in) financing activities $ (4,211) $ 515,958


	Six Months Ended June 30,
	2023		2022
Net cash used in operating activities	$	(107,619)	$	(153,248)
Net cash provided by (used in) investing activities	43,860		(13,736)
Net cash used in financing activities	$	(1,790)	$	(999)

Cash Flows from Operating Activities

Net cash used in operating activities was ~~$204.2~~$107.6 million for the ~~nine~~six months ended ~~September~~June 30, 2023. The most significant component of our cash used during this period was a net loss of $123.6 million adjusted for non-cash charges of $22.0 million related to stock-based compensation, $11.0 million related to depreciation and amortization, and $9.3 million related to non-cash interest expense related to the Convertible Notes. This cash outflow was increased further by $32.6 million from changes in operating assets and liabilities, primarily due to a $30.6 million decrease in accrued compensation, expenses and other liabilities, including a $10.6 million reduction in subcontractor accruals associated with the delivery of the Smart Building Platform product, a $7.4 million reduction in general accruals consistent with our cost reduction efforts, a $3.0 million reduction to the litigation settlement liability for a payment made in the first quarter of 2023, a $2.8 million reduction to loss accruals for work performed during fiscal year 2023, a $2.1 million reduction in sales taxes payable due to payment made in 2023, and a $1.9 million reduction in warranty accruals primarily related to settlements during fiscal year 2023. The change in operating assets and liabilities was also related to a $4.6 million increase in other assets primarily related to cash collateral associated with the Company’s surety bonds; offset by a $5.4 million decrease in accounts receivable as a result of timing of revenues and collections.

Net cash used in operating activities was $153.2 million for the six months ended June 30, 2022. The most significant component of our cash used during this period was a net loss of ~~$247.3~~$165.3 million adjusted for non-cash charges of ~~$58.8~~$35.6 million related to stock-based compensation and ~~$17.8~~$11.9 million related to depreciation and amortization, partially offset by the ~~$6.5~~$6.3 million non-cash gain related to change in fair value of our Sponsor Earn-Out liability and other derivative liabilities. This cash outflow was increased further by ~~$28.0~~$29.7 million from changes in operating assets and liabilities, primarily due to a ~~$12.1~~$11.7 million decrease in accrued ~~compensation,~~ expenses and other liabilities, including a ~~$9.7~~$6.5 million reduction to loss accruals for work performed during fiscal year 2022 and a ~~$3.9~~$2.8 million reduction in warranty accruals primarily related to settlements during fiscal year 2022, a ~~$8.5 million increase in prepaid and other operating assets as a result of increases in deposits paid to our materials suppliers and increases in contract assets with customers, a $2.8~~$8.7 million decrease in accounts payable due to timing of payments to our suppliers, a ~~$7.6~~$6.9 million increase in inventory as a result of increased demand and timing of shipments, and a ~~$3.8~~$3.6 million decrease in deferred revenue due to timing of satisfaction of our performance obligations relating to our revenue generating contracts with customers. These changes were offset by a $6.7 million decrease in accounts receivable as a result of timing of collections.

Net cash used in operating activities was $188.7 million for the nine months ended September 30, 2021. The most significant component of our cash used during this period was a net loss of $263.9 million adjusted for non-cash charges of $55.2 million related to stock-based compensation, $35.2 million related to depreciation and amortization, and a loss on extinguishment of debt of $10.0 million, partially offset by $18.4 million non-cash gain related to change in fair value of our Sponsor Earn-Out liability and other derivative liabilities. This cash outflow was increased further by $8.4 million from changes in operating assets and liabilities, primarily due to a $7.7 million increase in prepaid and other operating assets as a result of increases in contract assets with customers for the new View Smart Building Platform offering, an increase of $6.7 million in accounts receivable as a result of increased revenue and timing of collections, a $3.3 million increase in inventory and a $2.2 million decrease in accounts payable due to timing of payments to our suppliers. These increases to cash outflows were offset by a $10.6 million increase in accrued compensation, expenses and other liabilities as a result of an increase in accruals for expenses also consistent with the growth of operations and a $1.0 million increase in deferred revenue due to timing of satisfaction of our performance obligations relating to our revenue generating contracts with customers.

Cash Flows from Investing Activities

Net cash provided by investing activities was $43.9 million for the six months ended June 30, 2023, which was primarily due to proceeds from the maturity from short-term investments of $160.1 million, partially offset by purchases of short-term investments of $106.0 million, purchases of property plant and equipment of $7.2 million and cash disbursements under a note receivable of $3.0 million.

Net cash used in investing activities was ~~$19.6 million and $20.4~~$13.7 million for the ~~nine~~six months ended ~~September~~June 30, 2022, ~~and 2021, respectively,~~ which was ~~primarily~~ due to purchases of property, plant and equipment primarily related to the expansion of our manufacturing facilities. In addition, net cash used in investing activities for the nine months ended September 30, 2022 included $5.2 million cash disbursement under a note receivable and net cash used in investing activities for the nine months ended September 30, 2021 included $4.9 million cash paid for acquisitions.

Cash Flows from Financing Activities

Net ~~cash provided by~~used in financing activities was ~~$4.2~~$1.8 million for the ~~nine~~six months ended ~~September~~June 30, ~~2022,~~2023, which was primarily related to the ~~$3.1~~$1.3 million payment of tax withholdings paid on behalf of employees for net share settlement of equity awards, as well as finance lease and ~~long-term~~ debt ~~payments.~~issuance costs.

Net cash used in financing activities was ~~$516.0~~$1.0 million for the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, which was ~~primarily due to proceeds~~ related to ~~the reverse recapitalization~~finance lease and ~~PIPE offering of $773.5 million, net of transaction costs, partially offset by repayment in full of our revolving~~long-term debt ~~facility of $257.5 million.~~payments.

Off-Balance Sheet Arrangements

During the periods presented, we did not have any material off-balance sheet financing arrangements or any relationships with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special

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purpose entities, which were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

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During the course of business, our bank issues standby letters of credit on behalf of us to certain vendors and other third parties. As of ~~September~~June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the total value of the standby letters of credit issued by the bank is ~~$17.0~~$14.8 million and ~~$16.5~~$15.7 million, respectively. No amounts have been drawn under the standby letters of credit.

Critical Accounting Policies and Estimates

The preparation of financial statements and related disclosures in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires us to make judgments, assumptions, and estimates that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Note 1, “Organization and Summary of ~~Notes~~Significant Accounting Policies,” of the “Notes to Consolidated Financial ~~Statements~~Statements” in ~~Company’s 2021~~our 2022 Annual Report on Form 10-K filed with the SEC on ~~June 15, 2022~~March 31, 2023 describes the significant accounting policies and methods used in the preparation of these financial statements. The accounting policies described therein are significantly affected by critical accounting estimates and include the accounting for revenue recognition, product warranties, impairment of long-lived assets, impairment of goodwill, stock compensation, and the Sponsor Earn-out liability. Such accounting policies require significant judgments, assumptions, and estimates used in the preparation of the condensed consolidated financial statements, and actual results could differ materially from the amounts reported based on these policies. We have not made any changes in these critical accounting policies during the first ~~nine~~six months of ~~2022.~~2023.

~~Recent Accounting Pronouncements~~

~~For a description of recent accounting pronouncements, including the expected dates of adoption and estimated effects, if any, on our condensed consolidated financial statements, see Part I, Item 1,~~ ~~Note 1, “Organization and Summary of Significant Accounting Policies,” in our “Notes to Condensed Consolidated Financial Statements” in this Quarterly Report on Form 10-Q.~~

Item 3. Quantitative and Qualitative Disclosures About Market Risk

~~The exposure~~As a smaller reporting company, we are not required to market risks pertains mainly to changes in interest rates on cash and cash equivalents. Our outstanding debt as of September 30, 2022, relates to a long-term note that bears no interest with an outstanding balance of $14.7 million and $0.8 million of financing lease obligations. We do not expect net income or cash flows to be significantly affectedprovide the information required by ~~changes in interest rates.~~

Foreign currency transaction gains and losses were not material to our results of operations for the quarter ended September 30, 2022. To date, we have not entered into any foreign currency forward exchange contracts or other derivative financial instruments to hedge the effects of adverse fluctuations in foreign currency exchange rates.this item.

Item 4. Controls and Procedures

This Quarterly Report includes the certifications of our Chief Executive Officer and Chief Financial Officer required by Rule 13a-14 of the Securities Exchange Act of 1934 (the “Exchange Act”). See Exhibits 31.1 and 31.2. This Item 4 includes information concerning the controls and control evaluations referred to in those certifications.

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the U.S. Securities and Exchange Commission (“SEC”) rules and forms and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.

In connection with the preparation of this Quarterly Report, management, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of ~~September~~June 30, ~~2022.~~2023. Based on that evaluation, ~~due to the material weaknesses in internal control over financial reporting described below,~~ our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were not effective as of ~~September~~June 30, ~~2022.~~2023 due to the material weaknesses in internal control over financial reporting described below. Nevertheless, based on a number of factors, including ~~the completion of the Audit Committee’s investigation, our internal review that identified the need to restate our previously issued financial statements and~~ the performance of additional procedures by management designed to ensure the reliability of our financial reporting, we believe that the condensed consolidated financial statements in this Quarterly Report fairly present, in all material respects, our financial position, results of operations and cash flows as of the dates, and for the periods, presented, in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”).

Material Weaknesses in Internal Control over Financial Reporting

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

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As previously disclosed in the Form ~~10-K/A~~10-K for the year ended December 31, ~~2021,~~2022, management identified the following material weaknesses in our internal control over financial reporting that continue to exist as of ~~September~~June 30, ~~2022:~~2023:

•We did not design or maintain an effective internal control environment that meets our accounting and reporting requirements. Specifically, we did not have a sufficient complement of personnel with an appropriate degree of accounting knowledge and experience to appropriately analyze, record and disclose accounting matters commensurate with our accounting and reporting requirements and lacked related internal controls necessary to satisfy our accounting and financial reporting requirements. Additionally, we did not demonstrate a commitment to integrity and ethical values. These material weaknesses contributed to the following additional material weaknesses:

◦We we did not design or maintain effective controls in response to the risks of material misstatement, including designing and maintaining formal accounting policies, procedures, and controls over significant accounts and disclosures to achieve complete, accurate and timely financial accounting, reporting and disclosures, including with respect to revenue and ~~receivables, inventory, equity~~receivable and ~~derivative liabilities,~~ warranty-related ~~obligations, leasing arrangements, property, plant, and equipment, stock-based compensation, and period-end financial reporting.~~obligations.

◦~~We did not design or maintain effective controls over information technology (“IT”) general controls for information systems that are relevant to the preparation~~Table of our financial statements. Specifically, we did not design or maintain: (i) program change management controls for financial systems relevant to our financial reporting to ensure that information technology program and data changes affecting financial IT applications and underlying accounting records are identified, tested, authorized and implemented appropriately; (ii) user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to financial applications, programs, and data to appropriate personnel; (iii) computer operations controls to ensure critical data interfaces between systems are appropriately identified and monitored, data backups are authorized and monitored, and restorations are tested; and (iv) testing and approval controls for program development to ensure that new software development is aligned with business and IT requirements.Contents

~~The~~These material weaknesses in our control environment ~~in our response to the risks of material misstatement,~~ and in our warranty-related obligations process resulted in the need to restate our consolidated financial statements for the years ended December 31, 2020 and 2019, the unaudited quarterly financial information for the quarter ended March 31, 2021 and the unaudited quarterly financial information for each of the quarters in the year ended December 31, 2020. The ~~other~~ material ~~weaknesses, with the exception of the IT deficiencies,~~weakness in our revenues and receivable process resulted in adjustments that were not material to ~~substantially all of~~ our ~~accounts and disclosures for the~~annual or interim ~~and annual periods related to 2018, 2019, 2020, and 2021. The IT deficiencies did not result in an adjustment to the~~ financial statements; however, the deficiencies, when aggregated, could impact maintaining effective segregation of duties, as well as the effectiveness of IT-dependent controls (such as automated controls that address the risk of material misstatement to one or more assertions, along with the IT controls and underlying data that support the effectiveness of system-generated data and reports) that could result in misstatements potentially impacting all financial statement accounts and disclosures that would not be prevented or detected.statements. Additionally, ~~each of~~ these material weaknesses could result in a misstatement of substantially all of our account balances or disclosures that would result in a material misstatement to the annual or interim ~~condensed~~ consolidated financial statements that would not be prevented or detected.

Remediation ~~Plan~~

~~With oversight from the Audit Committee~~Efforts and ~~input from the Chair~~Status of the Board, management has continued designing and implementing changes in processes and controls to remediate the material weaknesses described above and to enhance our internal control over financial reporting as follows:Material Weaknesses

•~~During~~As previously disclosed in our Annual Report on Form 10-K for the third quarter of 2022, we have redesigned and enhanced control activities in response to the risk of material misstatement for our significant business processes, including inventory, equity and derivative liabilities, warranty-related obligations, leasing arrangements, property, plant, and equipment, stock-based compensation, and period-end financial reporting.

•~~We are continuing the process of designing and implementing new control activities in response to the risk of material misstatement for our revenue and receivables business processes.~~

•With the assistance of an independent consultant, we performed a comprehensive assessment of our financial reporting risk areas, associated review processes and other controls and subsequently implemented enhancements to achieve accurate and timely reporting, including with respect to:

◦~~warranty reserve accounting and accuracy of the accrual at each reporting period including the adequacy of the statistical model projecting future estimated failures and the costs; and~~

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◦~~existing disclosure committee structure, practices and charter, and the adequacy of its internal controls and processes.~~

•~~With the assistance of the independent consultant,~~year ended December 31, 2021, we performed a comprehensive review of our existing technical accounting capabilities and resources in the accounting/finance function, noting that certain positions in the accounting organization currently filled with interim resources need to be filled on a permanent basis. While we hired full time staff for many of these positions during 2022, certain open positions were filled with experienced and competent contractors. Management has concluded that the previously identified competency gap has been filled and the combination of the permanent staff and the interim contractors are fulfilling their roles and responsibilities. However, given the limited time that these positions have been filled during 2022 and the first half of 2023, management has concluded that additional time is needed to demonstrate the ability to consistently perform their roles and responsibilities before determining that the material weakness has been remediated. Management will continue to monitor the performance of the finance function to ensure controls are operating effectively for a sufficient period of time before concluding on remediation.

•~~Our~~Further, management has designed and implemented new ~~Chief Accounting Officer, who was hired~~control activities in ~~June 2021 with strong accounting expertise~~response to our commitment to integrity and ~~audit experience, was appointed interim Chief Financial Officer~~ethical values. However, given the limited time that these controls were operating during 2022 and the first half of 2023, management has concluded that additional time is needed to demonstrate the consistent operation of the new and enhanced controls before determining that the material weakness has been remediated. Management will continue to evaluate the control activities in response to our commitment to integrity and ethical values in the remaining half of 2023 to ensure they have operated effectively for a sufficient period of time before concluding on ~~November 8, 2021 and permanent Chief Financial Officer on February 17, 2022.~~remediation.

•~~We created a position~~During the first three quarters of ~~Vice President for Internal Audit reporting directly~~2022, we designed and implemented new control activities in response to the ~~Audit Committee~~risk of material misstatement related to warranty-related obligations. While the newly implemented controls were in place and ~~are currently recruiting for this position. In~~operated effectively as of December 31, 2022, March 31, 2023 and June 30, 2023, management has concluded that additional time is needed to demonstrate the ~~interim, we have outsourced~~consistent operation of the ~~assessment~~new and ~~testing of our internal control over financial reporting to an independent third party.~~enhanced controls before determining the material weakness has been remediated.

•~~The Board amended~~During 2022, we designed and implemented new control activities in response to the risk of material misstatement related to our ~~By-laws~~revenue and receivable process. While the newly implemented controls were in place and operated as of December 31, 2022, March 31, 2023 and June 30, 2023, management has concluded that additional time is needed to ~~separate~~demonstrate the ~~roles~~consistent operation of the Chair of the Board and the CEO. In addition, it established the position of Executive Chair with the duties of the Chair of the Board as set forth in our By-laws to serve at the direction of the Board and to be filled by an individual with substantial public company experience, in order to assist our CEO and focus on strengthening our financial and accounting functions, including financial statement reporting. Harold Hughes filled the position of Executive Chair from November 8, 2021, until his resignation on February 22, 2022. On February 23, 2022, Toby Cosgrove was appointed independent Chair of the Board. Mr. Cosgrove in his capacity as Chair of the Board along with Mr. Gormly in his capacity as Chair of the Audit Committee and the other independent members of the board will continue to assist our CEO and management to strengthen our financial and accounting functions.

•Management has provided, and will continue to provide, periodic training to members of the accounting and finance function on appropriate auditor communications, the identification of improper accounting behavior, and the various means available to employees to report potential instances of improper accounting and unethical activities in an anonymous manner without consequences.

•Management has continued its efforts to establish or enhance specific processes and controls to provide reasonable assurance with respect to the accuracy and integrity of financial reporting. These efforts included:

◦Centralization of the development, oversight, and monitoring of accounting policies and standardized processes in all critical accounting areas, including areas involving management judgment and discretion;

◦Implementation and clarification of specific accounting and finance policies, applicable worldwide, regarding the establishment, increase, and release of accrued liability and other balance sheet reserve accounts;

◦Creation of a revenue recognition accounting resource function to coordinate complex revenue recognition matters and to provide oversight and guidance on the design of controls and processes to enhance and standardize revenue recognition accounting procedures;

◦Improving the processes and procedures around the completion and review of quarterly sub-certification letters, in which our various business and finance leaders make full and complete representations concerning, and assume accountability for, the accuracy and integrity of their submitted financial results; and

◦Enhancing the development, communication, and monitoring of processes and controls to ensure that appropriate account reconciliations are performed, documented, and reviewed as part of standardized procedures.

•Management continues to invest in the design and implementation of additional and enhanced information technology systems, user applications and information technology general controls commensurate with the complexity of our business and financial reporting requirements, including the implementation of a tool used to monitor and assess segregation of duties conflicts in our enterprise resource planning system. It is expected that these investmentsnew and enhanced controls ~~will improve~~before determining the reliability of our financial reporting by reducing the need for manual processes, subjective assumptions, and management discretion; by reducing the opportunities for errors and omissions; and by decreasing reliance on manual controls to detect and correct accounting and financial reporting inaccuracies.

•In connection with our annual training requirements, management will reemphasize our communications to all employees regarding the availability of our Ethics Hotline, through which employees at all levels can anonymously submit information or express concerns regarding accounting, financial reporting, or other irregularities they have become aware of or have observed. In addition, these communications will emphasize the existence and availability of other reporting avenues or forums for all employees, such as their management chain, their Human Resources representatives, the Legal Department, and direct contact with our Chief Financial Officer or the Audit Committee.

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We believe the remediation measures described above will remediate the control deficiencies we have identified and strengthen our internal control over financial reporting. While these remediation measures are a critical priority, the design and implementation of control enhancements, and the continued execution of these enhancements, will take time to fully remediate all identified material ~~weaknesses. We are committed to continuing to improve our internal control processes and will continue to diligently and vigorously review our financial reporting controls and procedures.~~weakness has been remediated.

Changes in Internal Control Over Financial Reporting

~~Other than the changes described above under “Remediation Plan”, there~~There were no changes during the quarter ended June 30, 2023 in our internal control over financial reporting (as such term is defined in the Exchange Act) ~~during the quarter ended September 30, 2022~~ that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we are subject to claims, litigation, internal or governmental investigations, including those related to labor and employment, contracts, intellectual property, environmental, regulatory compliance, tax, commercial matters, and other related matters, some of which allege substantial monetary damages and claims. Please refer to Note 76 of the “Notes to the Condensed Consolidated Financial Statements” included in Part I, Item 1 of this Form 10-Q and Part I, Item 3. “Legal Proceedings” of the Company's ~~2021~~2022 Annual Report on Form 10-K, filed ~~June 15, 2022~~with the SEC on March 31, 2023 for additional information.

Item 1A. Risk Factors

The risk factors below should be read in conjunction with Part I, Item 1A. “Risk Factors” of the Company's ~~2021~~2022 Annual Report on Form 10-K, filed ~~June 15, 2022,~~ with the SEC on March 31, 2023, which discusses the material risk factors affecting our business operations and financial condition. Any of the risk factors included therein could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. The risks included below and in Part I, Item 1A. “Risk Factors” of the Company's ~~2021~~2022 Annual Report on Form 10-K, filed ~~June 15, 2022~~with the SEC on March 31, 2023 should be read in conjunction with the unaudited condensed consolidated financial statements and notes ~~included in this Quarterly Report on Form 10-Q included in Part I, Item 1, “Financial Statements (Unaudited)”~~

~~The Notes and~~to the Warrants are convertible into or exercisable for our Class A common stock, the issuance of which would increase the number of shares outstanding and eligible for future resale in the public market and would result in dilution to our stockholders.

~~As described~~unaudited condensed consolidated financial statements included elsewhere in this ~~Quarterly Report on~~ Form 10-Q, the Notes are convertible into shares of our Class A common stock. Similarly, the Warrants are exercisable for shares of our Class A common stock. The agreements pursuant to which the Notes and the Warrants were issued also provide the holders thereof with certain registration rights for the shares of Class A common stock issuable upon conversion or exercise thereof, including shares issuable upon conversion of the Notes if we were to elect the “payment-in-kind” option for the Notes for every interest payment date until maturity. In the event10-Q.

We cannot assure you that the ~~Notes are converted or~~Reverse Stock Split will increase the ~~Warrants are exercised, additional shares of our Class A common stock would be issued, which would result in dilution to the holders~~price of our Class A common stock and ~~increase~~have the ~~number~~desired effect of ~~shares eligible for resale in~~maintaining compliance with Nasdaq.

We expect that the ~~public market. Sales of substantial numbers of such shares in the public market, or the fact that such Notes may be converted or such Warrants may be exercised, could adversely affect~~Reverse Stock Split will increase the market price of our Class A common stock so that we are able to maintain compliance with the Nasdaq rules. However, the effect of a reverse stock split on the per share trading price of our Class A common stock cannot be predicted with any certainty, and ~~could have~~the outcomes of reverse stock splits for other companies are varied, particularly given that investors may view a ~~material adverse impact on~~reverse stock split as a negative indicator. It is possible that the per share trading price of our ~~business, financial condition and results of operations.~~

~~We have substantial indebtedness and may acquire additional indebtedness~~Class A common stock after the Reverse Stock Split will not increase in the ~~future, which could adversely affect~~same proportion as the reduction in the number of our ~~financial flexibility~~Class A outstanding shares of common stock following the Reverse Stock Split or at all, and ~~our competitive position. Any failure to comply with financial covenants in our debt agreements could~~the Reverse Stock Split may not result in ~~such debt agreements being declared~~a per share trading price that will attract investors who do not trade in ~~default.~~

lower priced stocks. We ~~have a significant amount of outstanding indebtedness~~cannot assure you that following the ~~completion~~Reverse Stock Split, our Class A common stock will be more attractive to investors or that we will regain compliance with the $1.00 minimum average closing share price requirement for continued listing on Nasdaq. Following the Reverse Stock Split, the per share trading price of our Class A common stock may decrease due to factors unrelated to the Reverse Stock Split, including our future performance. If the per share trading price of our Class A common stock following the Reverse Stock Split declines, the percentage decline as an absolute number and as a percentage of our overall market capitalization may be greater than would occur in the absence of the ~~sale of $200.0 million aggregate principal amount~~Reverse Stock Split.

The Reverse/Forward Stock Split may decrease the liquidity of our ~~6.00% / 9.00% Notes due 2027 on October 26, 2022,~~common stock.

The Reverse Stock Split may decrease the liquidity of our Class A common stock and result in higher transaction costs. The liquidity of our Class A common stock may be negatively impacted by the Reverse Stock Split, given the reduced number of shares that are outstanding following the Reverse Stock Split, particularly if the per share trading price does not increase as ~~described in Part I, Item 1,~~ ~~Note 14~~, “Subsequent Events,” in our “Notes to Condensed Consolidated Financial Statements” in this Quarterly Report on Form 10-Q. Our substantial indebtedness could have significant effects and consequences on our business. For example, as parta result of the ~~Strategic Agreement, we are now subject to a debt covenant that, among other things, prevents us from incurring certain debt in excess of $50 million principal amount (excluding~~Reverse Stock Split. In addition, the ~~Notes and certain debt incurred prior to or outstanding as of~~Reverse Stock Split will increase the date of the Strategic Agreement) during the term of the Strategic Agreement without the prior consent of RXR FP, subject to certain exceptions. Additionally, among other things, our substantial indebtedness could:

~~(a)increase our vulnerability to adverse changes in general economic, industry and competitive conditions;~~

~~(b)require us to dedicate a substantial portion~~number of our ~~cash flow from operations to make payments on our indebtedness, thereby reducing the availability~~stockholders who own “odd lots” of ~~our cash flow to fund working capital, capital expenditures~~fewer than 100 shares of common stock. Brokerage commission and other ~~general corporate purposes;~~

~~(c)restrict us from taking advantage~~costs of ~~business opportunities;~~

~~(d)make it~~transactions in odd lots are generally higher than the costs of transactions of more ~~difficult to satisfy our financial obligations;~~

~~(e)place us at a competitive disadvantage compared to our competitors that have less debt obligations; and~~

~~(f)limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions, debt service requirements, execution~~than 100 shares of ~~our business strategy or other general corporate purposes on satisfactory terms or at all.~~

Further, we may need to raise additional funding in the future to repay or refinance the Notes, potential future borrowings and our accounts payable, and as such, may need to seek additional debt or equity financing. Such additional financing may not be

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available on favorable terms, or at all. If debt financing is available and obtained, our interest expense may increase and we may become subject to the risk of default, depending on the terms of such financing. If equity financing is available and obtained, it may result in our stockholders experiencing significant dilution. If such financing is unavailable, we may be forced to curtail our operations, which may cause the value of our securities to decline in value and/or become worthless.common stock.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In the second quarter of 2021, the Company granted an aggregate amount of ~~257,625~~4,293 restricted stock units for shares of Class A ~~Common Stock~~common stock of the Company to its independent ~~directors.~~directors (the “Director RSUs”) . On May 14, 2021, Toby Cosgrove, Lisa Picard, Nigel Gormly, Harold Hughes, and Tom Leppert, were each granted ~~27,662~~461 RSUs, subject to time-based vesting conditions that vest in equal, quarterly installments over one year. On May 14, 2021, the Company granted RSUs to Mr. Hughes in the amount of ~~55,325~~922 units and Mr. Leppert in the amount of ~~41,493~~691 units. Such RSUs granted to Mr. Hughes and Mr. Leppert are subject to time-based vesting conditions and vest in equal installments over a three-year period with 33% to vest on each twelve-month anniversary of the grant date. On June 14, 2021, the Company granted Julie Larson-Green ~~22,497~~374 RSUs, subject to time-based vesting conditions that vest in equal, quarterly installments over one year. Mr. Hughes’ and Mr. Leppert’s remaining unvested RSUs were cancelled in connection with their resignations on February 22, 2022. As of ~~September~~June 30, ~~2022, 146,973~~2023, 2,449 restricted stock units of the Director RSUs have vested.

On March 8, 2021, the Company granted an aggregate amount of ~~12,500,000~~208,333 restricted stock units for shares of Class A ~~Common Stock~~common stock of the Company to its executive officers. The 2021 Officer RSUs time vest over a four-year period with 25% to vest on the twelve-month anniversary of ~~the Closing~~their grant date of March 8, 2021 and the remaining 75% to vest on a monthly basis over the

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following thirty-six months subject to the following market-based vesting. 50% of the 2021 Officer RSUs granted to each executive officer will only vest if the share price hurdle of ~~$15.00~~$900.00 is achieved and the remaining 50% of such 2021 Officer RSUs will vest if the share price hurdle of ~~$20.00~~$1,200.00 is achieved. On November 9, 2021, ~~1,000,000~~16,666 2021 Officer RSUs were cancelled in connection with an executive officer’s resignation from the Company. On March 8, 2022, ~~700,000~~11,666 2021 Officer RSUs were cancelled in connection with an executive officer’s resignation from the Company.

On August 5, 2022, the Board of Directors of the Company, upon recommendation of the Compensation Committee, approved an amendment (the “Amendment”) to the 2021 Officer RSUs under the 2021 Plan, which provided that, effective as of September 8, 2022, the market-based vesting conditions applicable to the 2021 Officer RSUs were no longer applicable, and the awards will continue to vest subject only to the time-based vesting conditions, subject to the executive’s continued employment with the Company through each applicable vesting date. Any 2021 Officer RSUs that are not time-vested as of the date of the executive’s termination of employment with the Company shall be forfeited and returned to the 2021 Plan. Except as expressly amended by the Amendment, all the terms and conditions of the 2021 Officer RSUs remained in full force and effect. As of ~~September~~June 30, ~~2022, 4,050,000~~2023, 101,250 restricted stock units of the 2021 Officer RSUs have vested, and ~~1,887,172~~47,789 restricted stock units were withheld and retired in connection with tax withholding payments made by the Company on behalf of the Officers.

On October 25, 2022, the Company entered into the Investment Agreement, pursuant to which it agreed to sell $200.0 million in aggregate principal amount of the Convertible Notes, with the option to sell an additional $40.0 million Convertible Notes, to the Purchasers (as defined in the indenture governing the Convertible Notes) in a private placement pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Company is selling the Convertible Notes to the Purchasers in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act. The Company is relying on this exemption from registration based in part on representations made by the Purchasers in the Investment Agreement. The Company is issuing the Warrants in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act. The Company is relying on this exemption from registration based in part on representations made by RXR FP in the RXR Warrant ~~Agreements.~~agreements.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

Item 6. Exhibits


Exhibit No.						Description
3.1						Amended and Restated Certificate of Incorporation of View, Inc. (incorporated by reference to Exhibit 3.3 of the Company’s Form 8-K, filed with the SEC on March 12, 2021).

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3.2						Certificate of Amendment to the Amended and Restated Certificate of Incorporation of View, Inc. (incorporated by reference to Exhibit 3.1 to the Company's Form 8-K, filed with the SEC on July 27, 2023).

~~Exhibit No.~~						~~Description~~
~~3.2~~3.3						Amended and Restated Bylaws of View, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K, filed with the SEC on July 22, 2022).

~~4.1+~~						Indenture, dated as of October 26, 2022, by and between View, Inc. and Wilmington Trust, National Association (incorporated by reference to Exhibit 4.1 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).

~~4.2+~~						~~Common Stock Purchase Warrant, dated as of October 25, 2022 (incorporated by reference to Exhibit 4.2 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).~~

~~4.3+~~						~~Common Stock Purchase Warrant, dated as of October 25, 2022 (incorporated by reference to Exhibit 4.3 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).~~

~~4.4+~~						~~Common Stock Purchase Warrant, dated as of October 25, 2022 (incorporated by reference to Exhibit 4.4 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).~~

~~10.1+~~						Investment Agreement, dated as of October 25, 2022, by and among View, Inc. and the other parties thereto (incorporated by reference to Exhibit 10.1 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).

~~10.2+~~						Agreement for Strategic Planning and Consulting Services, dated as of October 25, 2022, by and between View, Inc. and RXR FP Services LLC (incorporated by reference to Exhibit 10.2 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).

~~10.3~~						Letter Agreement, dated as of October 26, 2022, by and between View, Inc. and CF Principal Investments LLC (incorporated by reference to Exhibit 10.3 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).

~~10.4~~						Letter Agreement, dated as of October 26, 2022, by and among View, Inc., RXR FP Investor LP and RXR FP Investor II LP (incorporated by reference to Exhibit 10.4 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).

~~10.5~~						Letter Agreement, dated as of October 26, 2022, by and between View, Inc. and RXR FP Services LLC (incorporated by reference to Exhibit 10.5 to View, Inc.’s Current Report on Form 8-K filed on October 27, 2022).

~~10.6+~~						Primary Common Stock Purchase Agreement, dated as of August 8, 2022, by and between View, Inc. and CF Principal Investments LLC (incorporated by reference to Exhibit 10.1 to View, Inc.’s Current Report on Form 8-K filed on August 9, 2022).

~~10.7+~~						Standby Common Stock Purchase Agreement, dated as of August 8, 2022, by and between View, Inc. and YA II PN, Ltd. (incorporated by reference to Exhibit 10.2 to View, Inc.’s Current Report on Form 8-K filed on August 9, 2022).

~~10.8+~~						Registration Rights Agreement, dated as of August 8, 2022, by and among View, Inc., CF Principal Investments LLC and YA II PN, Ltd. (incorporated by reference to Exhibit 10.3 to View, Inc.’s Current Report on Form 8-K filed on August 9, 2022).

~~10.9^~~						Form of First Amendment to the Notice of Restricted Stock Unit Grant and Restricted Stock Unit Agreement under the View, Inc. 2021 Equity Incentive Plan (Executive RSUs) (incorporated by reference to Exhibit 10.4 to View, Inc.’s Current Report on Form 8-K filed on August 9, 2022).

31.1*						Certification of the Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*						Certification of the Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1**						Certification of the Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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~~Exhibit No.~~						~~Description~~
32.2**						Certification of the Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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Exhibit No.						Description
101.INS						XBRL Instance Document

101.SCH XBRL						Taxonomy Extension Schema Document

101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF						XBRL Taxonomy Extension Definition Linkbase Document

101.LAB						XBRL Taxonomy Extension Label Linkbase Document

101.PRE						XBRL Taxonomy Extension Presentation Linkbase Document

* Filed herewith

** Furnished herewith

+ Schedules to exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.

~~^ Denotes a management contract or compensatory plan or arrangement.~~

5547

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



						View, Inc.
Date: ~~November 8, 2022~~August 10, 2023
						/s/ Rao Mulpuri
						Name: Rao Mulpuri
						Title: Chief Executive Officer
						(Principal Executive Officer)

Date: ~~November 8, 2022~~August 10, 2023
						/s/ Amy Reeves
						Name: Amy Reeves
						Title: Chief Financial Officer
						(Principal Financial and Accounting Officer)

5648


	Redeemable Convertible Preferred Stock			Common Stock			Additional Paid-In Capital		Accumulated Deficit		Total Stockholders’ Equity (Deficit)
	Shares	Amount		Shares	Amount
Balances as of December 31, 2020	5,222,852	$	1,812,678	73,483	$	7	$	89,782	$	(1,914,353)	$	(1,824,564)
Retroactive application of reverse recapitalization (Note 2)	(5,101,421)	—		(71,774)	(7)		7		—		—
Balances as of December 31, 2020, as converted	121,431	$	1,812,678	1,709	$	—	$	89,789	$	(1,914,353)	$	(1,824,564)
Conversion of redeemable convertible preferred stock to common stock in connection with reverse recapitalization	(121,431)	(1,812,678)		121,431	12		1,812,666		—		1,812,678
Reverse recapitalization transaction, net of fees	—	—		93,865	10		745,741		—		745,751
Conversion of redeemable convertible preferred stock warrants to common stock warrants in connection with reverse recapitalization	—	—		—	—		7,267		—		7,267
Issuance of common stock upon exercise of stock options	—	—		72	—		382		—		382
Stock-based compensation	—	—		—	—		10,463		—		10,463
Net loss	—	—		—	—		—		(74,035)		(74,035)
Balances as of March 31, 2021	—	$	—	217,077	$	22	$	2,666,308	$	(1,988,388)	$	677,942
Issuance of common stock upon exercise of stock options	—	—		4	—		31		—		31
Vesting of restricted stock units	—	—		35	—		—		—		—
Stock-based compensation	—	—		—	—		22,274		—		22,274
Net loss	—	—		—	—		—		(95,720)		(95,720)
Balances as of June 30, 2021	—	$	—	217,116	$	22	$	2,688,613	$	(2,084,108)	$	604,527
Vesting of restricted stock units	—	—		40	—		—		—		—
Stock-based compensation	—	—		—	—		22,470		—		22,470
Net loss	—	—		—	—		—		(94,152)		(94,152)
Balances as of September 30, 2021	—	$	—	217,156	$	22	$	2,711,083	$	(2,178,260)	$	532,845


	Sponsor Earn-out Liability		Private Warrants
Balance as of December 31, 2021	$	7,624	$	174

Change in fair value	(6,364)		(147)

Balance as of September 30, 2022	$	1,260	$	27


	September 30, 2022		December 31, 2021
Current contract assets	$	14,634	$	11,532
Short-term deposits	11,555		4,554
Prepaid expenses	5,347		5,478
Restricted cash	1,859		—
Other current assets	1,134		15
Total prepaid expenses and other current assets	$	34,529	$	21,579


	Number of Unvested Shares	Weighted Average Grant Date Fair Value 1
Outstanding as of December 31, 2021	11,643	$	6.14
Granted	—	—
Vested	(4,082)	8.21
Canceled	(811)	6.28
Outstanding as of September 30, 2022	6,750	$	8.21


	CEO Option Award	Officer RSUs (Prior to Modification on August 5, 2022)	Officer Options
Expected stock price	$9.19	$9.19	$9.19
Expected volatility	54.0%	56.0%	53.0%
Risk-free rate	1.59%	0.60%	1.07%
Expected terms (in years)	10.0	4.0	6.0
Expected dividends	0%	0%	0%
Discount for lack of marketability	20%	n/a	n/a