| Balance Sheet Components | BALANCE SHEET COMPONENTS Accounts Receivable, Net Accounts receivable are contract assets that arise from the performance of our obligation pursuant to our contracts with our customers and represent our unconditional right to payment for the satisfaction of our performance obligations. They are recorded at invoiced amount and do not bear interest when recorded or accrue interest when past due. Accounts receivable are stated net of an allowance for doubtful accounts, which is maintained for estimated losses that may result from the inability of our customers to make required payments. Accounts receivable consist of the following: March 31, December 31, Accounts receivable, gross $ 8,627 $ 8,744 Less: allowance for doubtful accounts (63) (36) Accounts receivable, net $ 8,564 $ 8,708 The following is the change in our allowance for doubtful accounts: Three Months Ended March 31, 2022 2021 Balance at beginning of period $ 36 $ 41 Additions charged (reductions credited) 27 (6) Balance at end of period $ 63 $ 35 Inventories Inventories consist of finished goods and work-in-process, and are stated at the lower of standard cost (which approximates actual cost on a first-in, first-out basis) or market (net realizable value). Inventories consist of the following: March 31, December 31, Finished goods $ 477 $ 461 Work-in-process 1,317 1,008 Inventories $ 1,794 $ 1,469 Property and Equipment, Net Property and equipment, net consists of the following: March 31, December 31, Gross carrying amount $ 21,955 $ 21,817 Less: accumulated depreciation and amortization (16,580) (16,161) Property and equipment, net $ 5,375 $ 5,656 Acquired Intangible Assets, Net In connection with the acquisition of ViXS (the "Acquisition"), we recorded certain identifiable intangible assets. Acquired intangible assets resulting from this transaction were assigned to Pixelworks, Inc., and consist of the following: March 31, December 31, Developed technology $ 5,050 $ 5,050 Customer relationships 1,270 1,270 Backlog and tradename 410 410 6,730 6,730 Less: accumulated amortization (6,730) (6,640) Acquired intangible assets, net $ — $ 90 Developed technology and customer relationships were fully amortized as of March 31, 2022, tradename was fully amortized as of March 31, 2019 and backlog was fully amortized as of September 30, 2018. Amortization expense for intangible assets was $90 for the three months ended March 31, 2022, $72 was included in cost of revenue and $18 was included in selling, general and administrative for the three months ended March 31, 2022, in the condensed consolidated statements of operations. Goodwill Goodwill resulted from the Acquisition, whereby we recorded goodwill of $18,407. Goodwill is not amortized; however, we review goodwill for impairment annually and whenever events or changes in circumstances indicate that the fair value of the reporting unit may be less than it's carrying value. Conditions that would trigger an impairment assessment include, but are not limited to, a significant adverse change in our business climate or a current period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continued losses or adverse changes in legal factors, regulation or business environment. There were no such triggering events requiring a goodwill impairment assessment during the three months ended March 31, 2022. We perform our annual impairment assessment for goodwill on November 30 of each year. Accrued Liabilities and Current Portion of Long-Term Liabilities Accrued liabilities and current portion of long-term liabilities consist of the following: March 31, December 31, Accrued payroll and related liabilities $ 2,501 $ 3,490 Operating lease liabilities, current 2,330 2,439 Deferred research and development reimbursement 855 1,838 Current portion of accrued liabilities for asset financings 799 1,077 Accrued interest payable 363 361 Accrued commissions and royalties 239 259 Deferred revenue 220 50 Other 2,464 4,049 Accrued liabilities and current portion of long-term liabilities $ 9,771 $ 13,563 Deferred research and development reimbursement is related to the Co-Development Agreement discussed in "Note 7: Research and Development". Deferred revenues are contract liabilities that arise when cash payments are received or due in advance of the satisfaction of our performance obligations. Any increase in deferred revenues is driven by cash payments received or due in advance of satisfying our performance obligation pursuant to the contract with the customer. Any decrease in deferred revenues is due to the recognition of revenue related to satisfying our performance obligation. The change in deferred revenue is as follows: Three Months Ended March 31, 2022 2021 Deferred revenue: Balance at beginning of period $ 50 $ 179 Revenue recognized (80) (264) Revenue deferred 250 205 Balance at end of period $ 220 $ 120 |
