Atomera (ATOM) 10-Q 7 May 21 2021 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2021	May 03, 2021
Cover [Abstract]
Entity Registrant Name	Atomera Inc
Entity Central Index Key	0001420520
Document Type	10-Q
Document Period End Date	Mar. 31, 2021
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity's Reporting Status Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		23,037,493
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2021
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Transition Period	true
Interactive Data Current	Yes
Entity Incorporation State Country Code	DE
Entity File Number	001-37850
Entity Shell Company	false

Condensed Balance Sheets (Unaud

Condensed Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Current Assets:
Cash and cash equivalents	$ 36,738	$ 37,942
Accounts receivable, net	66	0
Prepaid expenses and other current assets	811	132
Total current assets	37,615	38,074
Property and equipment, net	164	153
Operating lease right-of-use asset	1,046	705
Long-term prepaid rent	450	450
Security deposit	14	13
Total assets	39,289	39,395
Current liabilities:
Accounts payable	508	442
Accrued expenses	196	211
Accrued payroll related expenses	288	705
Current operating lease liability	195	90
Total current liabilities	1,187	1,448
Long term operating lease liability	888	602
Total Liabilities	2,075	2,050
Commitments and contingencies (see Note 10)
Stockholders' equity:
Preferred stock $0.001 par value, authorized 2,500 shares; none issued and outstanding at March 31, 2021 and December 31, 2020	0	0
Common stock: $0.001 par value, authorized 47,500 shares; 23,073 and 20,971 shares issued March 31, 2021 and December 31, 2020, respectively; 23,027 and 20,971 shares outstanding at March 31, 2021 and December 31, 2020, respectively	23	22
Additional paid-in capital	190,951	187,463
Accumulated deficit	(153,760)	(150,140)
Total stockholders' equity	37,214	37,345
Total liabilities and stockholders' equity	$ 39,289	$ 39,395

Condensed Balance Sheets (Una_2

Condensed Balance Sheets (Unaudited) (Parenthetical) - $ / shares shares in Thousands	Mar. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized	2,500	2,500
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized	47,500	47,500
Common stock, issued	23,073	20,971
Common stock, oustanding	23,027	20,971

Condensed Statements of Operati

Condensed Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Income Statement [Abstract]
Revenue	$ 400	$ 62
Cost of revenue	0	(13)
Gross margin	400	49
Operating Expenses:
Research and development	2,229	2,062
General and administrative	1,513	1,445
Selling and marketing	266	225
Total operating expenses	4,008	3,732
Loss from operations	(3,608)	(3,683)
Other income:
Interest income	2	38
Total other income	2	38
Net loss before taxes	(3,606)	(3,645)
Provision for income taxes	14	0
Net loss	$ (3,620)	$ (3,645)
Net loss per common share, basic and diluted	$ (0.16)	$ (0.22)
Weighted average number of common shares outstanding, basic and diluted	22,090	16,760

Statement of Stockholders' Equi

Statement of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Beginning balance, shares at Dec. 31, 2019	17,117
Beginning balance, value at Dec. 31, 2019	$ 17	$ 149,017	$ (135,262)	$ 13,772
Stock-based compensation, shares	420
Stock-based compensation, value	$ 1	628		629
Warrant exercise, shares	189
Warrant exercise, value		164		164
Warrant modification		139		139
Net loss			(3,645)	(3,645)
Ending balance, shares at Mar. 31, 2020	17,726
Ending balance, value at Mar. 31, 2020	$ 18	149,948	(138,907)	11,059
Beginning balance, shares at Dec. 31, 2020	22,375
Beginning balance, value at Dec. 31, 2020	$ 22	187,463	(150,140)	37,345
Stock-based compensation, shares	71
Stock-based compensation, value		731		731
At-the-market sale of stock, net of commissions and expenses, shares	14
At-the-market sale of stock, net of commissions and expenses, value		243		243
Stock option exercise, shares	398
Stock option exercise, value	$ 1	2,514		2,515
Warrant exercise, shares	223
Warrant exercise, value
Forfeited restricted stock awards, shares	(54)
Warrant modification				0
Net loss			(3,620)	(3,620)
Ending balance, shares at Mar. 31, 2021	23,027
Ending balance, value at Mar. 31, 2021	$ 23	$ 190,951	$ (153,760)	$ 37,214

Condensed Statements of Cash Fl

Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss	$ (3,620)	$ (3,645)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	13	10
Right of use asset amortization	40	36
Stock-based compensation	731	629
Warrant modification expense	0	139
Changes in operating assets and liabilities:
Accounts receivable	(66)	0
Prepaid expenses and other current assets	(679)	14
Long-term prepaid rent	0	(450)
Accounts payable	66	233
Accrued expenses	(16)	40
Accrued payroll expenses	(417)	(575)
Lease liability	10	(36)
Deferred revenue	0	(37)
Net cash used in operating activities	(3,938)	(3,642)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment	(24)	(3)
Net cash used in investing activities	(24)	(3)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from at-the-market sale of stock, net of commissions and expenses	243	0
Proceeds from exercise of warrants	0	164
Proceeds from exercise of stock options	2,515	0
Net cash provided by financing activities	2,758	164
Net (decrease) in cash and cash equivalents	(1,204)	(3,481)
Cash and cash equivalents at beginning of period	37,942	14,871
Cash and cash equivalents at end of period	36,738	11,390
Supplemental Information:
Cash paid for interest	0	0
Cash paid for taxes	0	0
Non-cash investing and financing activities
Exercise of warrants-cashless	$ 0	$ 0

1. NATURE OF OPERATIONS

1. NATURE OF OPERATIONS	3 Months Ended
	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF OPERATIONS	1. NATURE OF OPERATIONS Atomera Incorporated (“Atomera” or the “Company”) was incorporated in the state of Delaware in March 2007 under the name MEARS Technologies, Inc. and is engaged in the development, commercialization and licensing of proprietary processes and technologies for the semiconductor industry. On January 12, 2016, the Company changed its name to Atomera Incorporated. Atomera is an early-stage company, having only recently begun limited revenue-generating activities, and is devoting substantially all of its efforts toward technology research and development and to commercially licensing its technology to manufacturers and designers of integrated circuits. The Company has primarily financed operations through private placements of equity and debt securities, the Company’s Initial Public Offering (the “IPO”) which was consummated on August 10, 2016, and subsequent public offerings of its common stock.

2. LIQUIDITY AND MANAGEMENT PLA

2. LIQUIDITY AND MANAGEMENT PLANS	3 Months Ended
	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
LIQUIDITY AND MANAGEMENT PLANS	2. LIQUIDITY AND MANAGEMENT PLANS At March 31, 2021, the Company had cash and cash equivalents of approximately $36.7 million and working capital of approximately $36.4 million. The Company has generated only limited revenues since inception and has incurred recurring operating losses. The Company’s operating plans for the next 12 months include increased spending on research and development headcount, outsourced fabrication and testing, and sales and marketing expenses to drive customer adoption of the Company’s MST technology. Based on the funds it has available as of the date of the filing of this report, the Company believes that it has sufficient capital to fund its current business plans and obligations over, at least, 12 months from the date that these financial statements have been issued. However, as the Company has generated only limited revenue from its principal operations, it is subject to all the risks inherent in the initial organization, financing, expenditures, complications and delays in a new business. Accordingly, the Company may require additional capital, the receipt of which cannot be assured. In the event the Company requires additional capital, there can be no guarantee that funds will be available on commercially reasonable terms, if at all. The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its technology, competing technological and market developments, and the need to enter into collaborations with other companies or acquire technologies to enhance or complement its current offerings. If the Company is unable to secure additional capital, it may be required to curtail its research and development initiatives and take additional measures to reduce costs in order to conserve its cash.

3. SUMMARY OF SIGNIFICANT ACCOU

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2021
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Significant accounting policies There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 19, 2021. Basis of presentation of unaudited condensed financial information The unaudited condensed financial statements of the Company for the three months ended March 31, 2021 and 2020 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for the fair presentation of the Company’s financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31, 2020 was derived from the audited financial statements included in the Company's financial statements as of and for the year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 19, 2021. These financial statements should be read in conjunction with that report. Adoption of recent accounting standards In December 2019, the FASB issued ASU No. 2019-12, Simplifying Accounting for Income Taxes Income taxes Recent accounting standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-06, Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40).

4. REVENUE

4. REVENUE	3 Months Ended
	Mar. 31, 2021
Revenue from Contract with Customer [Abstract]
REVENUE	4. REVENUE The Company recognizes revenue in accordance with ASC 606. The amount of revenue that the Company recognizes reflects the consideration it expects to receive in exchange for goods or services and such revenue is recognized at the time when goods or services are transferred and/or delivered to its customers. Revenue is recognized when the Company satisfies a performance obligation by transferring the product or service to the customer. The Company generates revenues from engineering service contracts, integration license agreements and joint development agreements. When the Company’s performance obligation is the promise to grant a license, revenue is recognized either at a point in time or over time. The following table provides information about disaggregated revenue by primary geographical markets and timing of revenue recognition (in thousands): Three Months Ended March 31, 2021 2020 Primary geographic markets North America $ – $ 62 Asia Pacific 400 – Total $ 400 $ 62 Timing of revenue recognition Products and services transferred at a point in time $ 400 $ 62 Products and services transferred over time – – Total $ 400 $ 62 Unbilled contracts receivable and deferred revenue : Timing of revenue recognition may differ from the timing of invoicing customers. Accounts receivable includes amounts billed and currently due from customers. Unbilled contracts receivable represents unbilled amounts expected to be received from customers in future periods, where the revenue recognized to date exceeds the amount billed, and the right to receive payment is subject to the underlying contractual terms. Unbilled contracts receivable amounts may not exceed their net realizable value and are classified as long-term assets if the payments are expected to be received more than one year from the reporting date. The Company records deferred revenue when revenue will be recognized after invoicing. During the three months ended March 31, 2020, the Company recognized approximately $37,000 of revenue that was included in deferred revenue as of December 31, 2019.

5. BASIC AND DILUTED LOSS PER S

5. BASIC AND DILUTED LOSS PER SHARE	3 Months Ended
	Mar. 31, 2021
Earnings Per Share [Abstract]
BASIC AND DILUTED LOSS PER SHARE	5. BASIC AND DILUTED LOSS PER SHARE Basic net loss per share is calculated by dividing the net loss by the weighted-average number of shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the sum of the weighted average number of shares of common stock outstanding and the dilutive common stock equivalent shares outstanding during the period. The Company’s potentially dilutive common stock equivalent shares, which include incremental common shares issuable upon (i) the exercise of outstanding stock options and warrants and (ii) vesting of restricted stock units and restricted stock awards, are only included in the calculation of diluted net loss per share when their effect is dilutive. Since the Company has had net losses for all periods presented, all potentially dilutive securities are anti-dilutive. Accordingly, basic and diluted net loss per share are equal. The following potential common stock equivalents were not included in the calculation of diluted net loss per common share because the inclusion thereof would be anti-dilutive (in thousands): Three Months Ended March 31, 2021 2020 Stock options 3,018 3,581 Unvested restricted stock 596 869 Warrants 2 566 Total 3,616 5,016

6. LEASES

6. LEASES	3 Months Ended
	Mar. 31, 2021
Leases [Abstract]
Leases	6. LEASES The Company leases corporate office space in Los Gatos, California. In August 2020, the Company and its landlord amended the lease for this office. This amendment extends the expiration date of the operating lease from January 2021 to January 2026 and increases the space from 3,396 square feet to 4,101 square feet. Under Accounting Standard Codification (“ASC”) 842, the lease amendment was treated as a separate lease for the new space and a modification of the lease for the original space. An additional right-of-use (“ROU”) asset and lease liability of approximately $681,000 were recorded during at the time of the amendment. In January 2021 the additional space became available for use, and the Company recorded an additional ROU asset and corresponding liability of approximately $144,000. The lease liability is based on the present value of the minimum lease payments, discounted using the Company’s estimated incremental borrowing rate of 5.5%. The lease contains escalating payments on the anniversary of the original commencement which are included in the measurement of the initial lease liability. Additional payments based on a change in the Company’s share of the operating expenses, including property taxes and insurance, are recorded as a period expense when incurred. In March 2021, the Company began leasing 474 square feet of office space in Tempe, Arizona. The new lease is classified as an operating lease with an initial term of two years and an option to extend for an additional three years through February 2026. The lease also contains a performance standard for research collaboration with Arizona State University. The agreement requires a minimum value of collaborative research in each year of the lease. The lease is accounted for under ASC 842 and accordingly, the research payments are included in the ROU and lease liability at the commencement. In March 2021, the Company recorded an ROU and associated lease liability of approximately $238,000. The lease liability is based on the present value of the minimum lease payments, discounted using the Company’s estimated incremental borrowing rate of 5.5% over five years, as the Company expects to lease the through the three year extension. The lease also contains escalating payments on the anniversary of the original commencement which are included in the measurement of the initial lease liability. Lease expense for operating leases consists of the lease payments recognized on a straight-line basis over the lease term. The components of operating lease costs were as follows (in thousands): Three Months Ended March 31, 2021 2020 Fixed lease costs $ 52 $ 27 Variable lease costs – 13 Short term lease costs 11 10 Total operating lease costs $ 63 $ 50 Future minimum payments under non-cancellable leases as of March 31, 2021 were as follows (in thousands): For the Year Ended December 31, Amount Remaining 2021 $ 148 2022 239 2023 271 2024 278 2025 & thereafter 305 Total future minimum lease payments 1,241 Less imputed interest (158 ) Total lease liability $ 1,083 The following table provides supplemental information and non-cash activity related to the Company’s operating leases (in thousands): Three Months Ended March 31, 2021 2020 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 2 $ 41 Non-cash activity: Right-of-use assets obtained in exchange for the lease obligations $ 382 $ – In October 2019, the Company entered into an agreement to lease a tool for use in the development of the Company’s technology. The lease is for five years at $150,000 per month. The lease commencement date is anticipated to be in May 2021, at which time the Company will account for the lease under ASC 842. A prepayment of $450,000 was made in the three months ended March 31, 2020, this payment represents the final three payments under the lease and is recorded as a long-term prepaid until the lease commencement, at which time it will be record in accordance with ASC 842.

7. WARRANTS

7. WARRANTS	3 Months Ended
	Mar. 31, 2021
Equity [Abstract]
Warrants	7. WARRANTS A summary of warrant activity for the three months ended March 31, 2021 is as follows (in thousands except per share amounts and contractual term): Schedule of warrant activity Number of Shares Weighted- Average Exercise Price Weighted- Remaining Contractual Term (In Years) Outstanding at January 1, 2021 320 $ 9.47 Exercised (318 ) $ 9.38 Outstanding at March 31, 2021 2 $ 24.81 0.8 The warrants outstanding at March 31, 2021 had an intrinsic value of approximately $11,000 based on a per-share stock price of $24.50 as of March 31, 2021. On March 17, 2020, 196,602 warrants with an exercise price of $3.75 were set to expire. Prior to the expiration, the Company entered into an agreement with the warrant holders, whereby it modified the terms of the warrants to extend the expiration date until September 17, 2020 in exchange for the removal of a cashless exercise provision. No other terms were modified. Due to this modification, the Company incurred a modification expense of approximately $139,000 that is included in general and administrative expenses on the Condensed Statement of Operations for the three months ended March 31, 2020. All of the modified warrants were exercised on August 6, 2020. In January 2021, warrants for 317,488 shares were presented for cashless exercises resulting in the issuance of 223,487 shares of common stock.

8. STOCK BASED COMPENSATION

8. STOCK BASED COMPENSATION	3 Months Ended
	Mar. 31, 2021
Share-based Payment Arrangement [Abstract]
STOCK BASED COMPENSATION	8. STOCK BASED COMPENSATION In May 2017, the Company’s shareholders approved its 2017 Stock Incentive Plan (“2017 Plan”) after its 2007 Stock Incentive Plan (“2007 Plan”) had expired in March 2017. The 2017 Plan provides for the grant of non-qualified stock options and incentive stock options to purchase shares of the Company’s common stock and for the grant of restricted and unrestricted shares. The 2017 Plan provides for the issuance of 3,750,000 shares of common stock. All of the Company’s employees and any subsidiary employees (including officers and directors who are also employees), as well as all of the Company’s nonemployee directors and other consultants, advisors and other persons who provide services to the Company are eligible to receive incentive awards under the 2017 Plan. Generally, stock options and restricted stock issued under the 2017 Plan vest over a period of one to four years from the date of grant. The following table summarizes the stock-based compensation expense recorded in the Company’s results of operations during the three months ended March 31, 2021 and 2020 for stock options and restricted stock granted under the 2017 Plan and the 2007 Plan (in thousands): Three Months Ended March 31, 2021 2020 Research and development $ 223 $ 227 General and administrative 455 369 Selling and Marketing 53 33 $ 731 $ 629 As March 31, 2021, there was approximately $6.5 million of total unrecognized compensation expense related to unvested share-based compensation arrangements. This cost is expected to be recognized over a weighted-average period of 2.5 years. The weighted average grant date fair value per share of the options granted under the Company’s 2017 Plan was $15.94 and $2.70 for the three months ended March 31, 2021 and 2020, respectively. The following table summarizes stock option activity during the three months ended March 31, 2021 (in thousands except exercise prices and contractual terms): Number of Shares Weighted- Average Exercise Prices Weighted- Remaining Contractual Term (In Years) Intrinsic Outstanding at January 1, 2021 3,446 $ 5.97 Granted 73 $ 22.72 Exercised (398 ) $ 6.32 Forfeited (103 ) $ 4.17 Outstanding at March 31, 2021 3,018 $ 6.39 6.46 $ 54,736 Exercisable at March 31, 2021 2,250 $ 6.50 5.73 $ 40,564 During the three months ended March 31, 2021, the Company granted options under the 2017 Plan to purchase approximately 73,000 shares of its common stock to its employees. The fair value of these options was approximately $1.2 million at the time of grant. The Company issues restricted stock to employees, directors and consultants and estimates the fair value based on the closing price on the day of grant. The following table summarizes all restricted stock activity during the three months ended March 31, 2021 (in thousands except per share data): Number of Shares Weighted- Average Grant Date Outstanding at January 1, 2021 642 $ 4.43 Granted 71 $ 22.38 Vested (63 ) $ 4.54 Forfeited (54 ) $ 4.81 Outstanding non-vested shares at March 31, 2021 596 $ 6.53 During the three months ended March 31, 2021 the Company granted approximately 71,000 restricted stock awards under the 2017 Plan to its employees and directors. The fair value of these awards was approximately $1.6 million at the time of grant. During the quarter ended March 31, 2021, approximately 54,000 restricted stock awards were forfeited. Approximately 9,000 of these shares were then reissued as restricted stock awards. The remaining approximately 45,000 shares can be reissued in the future under its equity compensation plan.

9. PROVISION FOR INCOME TAXES

9. PROVISION FOR INCOME TAXES	3 Months Ended
	Mar. 31, 2021
Income Tax Disclosure [Abstract]
PROVISION FOR INCOME TAXES	9. PROVISION FOR INCOME TAXES The Company recorded a provision for income taxes of approximately $14,000 and $0 during the three months ended March 31, 2021, respectively. The provision is withholding income taxes accrued in foreign jurisdictions where we have income. The Company recorded the provision in accordance with ASC 740 using its estimated annual tax rate and applied it to the net loss for the three months ended March 31, 2021.

10. COMMITMENTS AND CONTINGENCI

10. COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	10. COMMITMENTS AND CONTINGENCIES Litigation, Claims and Assessments The Company may be subject to periodic lawsuits, investigations and claims that arise in the ordinary course of business. The Company is not party to any material litigation as of March 31, 2021, or through the date these financial statements have been issued.

11. SUBSEQUENT EVENTS

11. SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2021
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	11. SUBSEQUENT EVENTS Management has evaluated subsequent events and transactions through the date these financial statements were issued.

3. SUMMARY OF SIGNIFICANT ACC_2

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2021
Accounting Policies [Abstract]
Basis of presentation of unaudited condensed financial information	Basis of presentation of unaudited condensed financial information The unaudited condensed financial statements of the Company for the three months ended March 31, 2021 and 2020 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for the fair presentation of the Company’s financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31, 2020 was derived from the audited financial statements included in the Company's financial statements as of and for the year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 19, 2021. These financial statements should be read in conjunction with that report.
Adoption of recent accounting standards	Adoption of recent accounting standards In December 2019, the FASB issued ASU No. 2019-12, Simplifying Accounting for Income Taxes Income taxes
Recent accounting standards	Recent accounting standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-06, Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40).

4. REVENUE (Tables)

4. REVENUE (Tables)	3 Months Ended
	Mar. 31, 2021
Revenue from Contract with Customer [Abstract]
Information about disaggregated revenue and timing of revenue	The following table provides information about disaggregated revenue by primary geographical markets and timing of revenue recognition (in thousands): Three Months Ended March 31, 2021 2020 Primary geographic markets North America $ – $ 62 Asia Pacific 400 – Total $ 400 $ 62 Timing of revenue recognition Products and services transferred at a point in time $ 400 $ 62 Products and services transferred over time – – Total $ 400 $ 62

5. BASIC AND DILUTED LOSS PER_2

5. BASIC AND DILUTED LOSS PER SHARE (Tables)	3 Months Ended
	Mar. 31, 2021
Earnings Per Share [Abstract]
Schedule of antidilutive shares	The following potential common stock equivalents were not included in the calculation of diluted net loss per common share because the inclusion thereof would be anti-dilutive (in thousands): Three Months Ended March 31, 2021 2020 Stock options 3,018 3,581 Unvested restricted stock 596 869 Warrants 2 566 Total 3,616 5,016

6. LEASES (Tables)

6. LEASES (Tables)	3 Months Ended
	Mar. 31, 2021
Leases [Abstract]
Components of lease costs	The components of operating lease costs were as follows (in thousands): Three Months Ended March 31, 2021 2020 Fixed lease costs $ 52 $ 27 Variable lease costs – 13 Short term lease costs 11 10 Total operating lease costs $ 63 $ 50
Schedule of future minimum lease payments	Future minimum payments under non-cancellable leases as of March 31, 2021 were as follows (in thousands): For the Year Ended December 31, Amount Remaining 2021 $ 148 2022 239 2023 271 2024 278 2025 & thereafter 305 Total future minimum lease payments 1,241 Less imputed interest (158 ) Total lease liability $ 1,083
Supplemental non-cash actiity related to operating leases	The following table provides supplemental information and non-cash activity related to the Company’s operating leases (in thousands): Three Months Ended March 31, 2021 2020 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 2 $ 41 Non-cash activity: Right-of-use assets obtained in exchange for the lease obligations $ 382 $ –

7. WARRANTS (Tables)

7. WARRANTS (Tables)	3 Months Ended
	Mar. 31, 2021
Equity [Abstract]
Schedule of warrant activity	A summary of warrant activity for the three months ended March 31, 2021 is as follows (in thousands except per share amounts and contractual term): Schedule of warrant activity Number of Shares Weighted- Average Exercise Price Weighted- Remaining Contractual Term (In Years) Outstanding at January 1, 2021 320 $ 9.47 Exercised (318 ) $ 9.38 Outstanding at March 31, 2021 2 $ 24.81 0.8

8. STOCK BASED COMPENSATION (Ta

8. STOCK BASED COMPENSATION (Tables)	3 Months Ended
	Mar. 31, 2021
Share-based Payment Arrangement [Abstract]
Schedule of stock-based compensation expense	The following table summarizes the stock-based compensation expense recorded in the Company’s results of operations during the three months ended March 31, 2021 and 2020 for stock options and restricted stock granted under the 2017 Plan and the 2007 Plan (in thousands): Three Months Ended March 31, 2021 2020 Research and development $ 223 $ 227 General and administrative 455 369 Selling and Marketing 53 33 $ 731 $ 629
Schedule of stock option activity	The following table summarizes stock option activity during the three months ended March 31, 2021 (in thousands except exercise prices and contractual terms): Number of Shares Weighted- Average Exercise Prices Weighted- Remaining Contractual Term (In Years) Intrinsic Outstanding at January 1, 2021 3,446 $ 5.97 Granted 73 $ 22.72 Exercised (398 ) $ 6.32 Forfeited (103 ) $ 4.17 Outstanding at March 31, 2021 3,018 $ 6.39 6.46 $ 54,736 Exercisable at March 31, 2021 2,250 $ 6.50 5.73 $ 40,564
Schedule of restricted stock option activity	The following table summarizes all restricted stock activity during the three months ended March 31, 2021 (in thousands except per share data): Number of Shares Weighted- Average Grant Date Outstanding at January 1, 2021 642 $ 4.43 Granted 71 $ 22.38 Vested (63 ) $ 4.54 Forfeited (54 ) $ 4.81 Outstanding non-vested shares at March 31, 2021 596 $ 6.53

2. LIQUIDITY AND MANAGEMENT P_2

2. LIQUIDITY AND MANAGEMENT PLANS (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 36,738	$ 37,942	$ 11,390	$ 14,871
Working capital	$ 36,400

4. REVENUE (Details)

4. REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenue	$ 400	$ 62
Transferred at Point in Time [Member]
Revenue	400	62
Transferred Over Time [Member]
Revenue	0	0
North America [Member]
Revenue	0	62
Asia Pacific [Member]
Revenue	$ 400	$ 0

4. REVENUE (Details Narrative)

4. REVENUE (Details Narrative) $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)
Revenue from Contract with Customer [Abstract]
Revenue recognized that was previously included in deferred revenue	$ 37

5. BASIC AND DILUTED LOSS PER_3

5. BASIC AND DILUTED LOSS PER SHARE (Details) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Potential common stock equivalents	3,616	5,016
Stock options [Member]
Potential common stock equivalents	3,018	3,581
Unvested Restricted Stock [Member]
Potential common stock equivalents	596	869
Warrants [Member]
Potential common stock equivalents	2	566

6. LEASES (Details - Lease cost

6. LEASES (Details - Lease costs) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Leases [Abstract]
Fixed lease costs	$ 52	$ 27
Variable lease costs	0	13
Short term lease costs	11	10
Total operating lease costs	$ 63	$ 50

6. LEASES (Details - Minimum le

6. LEASES (Details - Minimum lease payments) $ in Thousands	Mar. 31, 2021USD ($)
Leases [Abstract]
Remaining 2021	$ 148
2022	239
2023	271
2024	278
2025 and thereafter	305
Total future minimum payments due	1,241
Less imputed interest	(158)
Total lease liability	$ 1,083

6. LEASES (Details - Cash flow

6. LEASES (Details - Cash flow effect) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$ 2	$ 41
Non-cash activity:
Right-of-use assets obtained in exchange for the lease obligations	$ 382	$ 0

6. LEASES (Details Narrative)

6. LEASES (Details Narrative) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Jan. 31, 2021	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020	Aug. 31, 2020
Operating lease right-of-use asset		$ 1,046		$ 705
Incremental borrowing rate		5.50%
Right-of-use Asset Obtained in Exchange for Operating Lease Liability		$ 382	$ 0
Long-term prepaid rent		$ 450
CALIFORNIA
Operating lease right-of-use asset					$ 681
Incremental borrowing rate		5.50%
Right-of-use Asset Obtained in Exchange for Operating Lease Liability	$ 144
ARIZONA
Operating lease right-of-use asset		$ 238
Incremental borrowing rate		5.50%
Lease term		5 years

7. WARRANTS (Details - Warrant

7. WARRANTS (Details - Warrant activity) - Warrants [Member] shares in Thousands	3 Months Ended
	Mar. 31, 2021$ / sharesshares
Warrants outstanding, beginning balance | shares	320
Warrants exercised | shares	(318)
Warrants outstanding, ending balance | shares	2
Weighted-average exercise price, warrants outstanding, beginning balance | $ / shares	$ 9.47
Weighted-average exercise price, warrants exercised | $ / shares	9.38
Weighted-average exercise price, warrants outstanding, ending balance | $ / shares	$ 24.81
Weighted-average remaining contractual term	9 months 18 days

7. WARRANTS (Details Narrative)

7. WARRANTS (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Warrant modification expense	$ 0	$ 139
Warrants [Member]
Warrant intrinsic value	$ 11,000
Stock price	$ 24.50
Warrant modification expense		$ 139

8. STOCK BASED COMPENSATION (De

8. STOCK BASED COMPENSATION (Details - Compensation Expense) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Allocated stock-based compensation	$ 731	$ 629
Research and Development [Member]
Allocated stock-based compensation	223	227
General and Administrative [Member]
Allocated stock-based compensation	455	369
Selling and Marketing [Member]
Allocated stock-based compensation	$ 53	$ 33

8. STOCK BASED COMPENSATION (_2

8. STOCK BASED COMPENSATION (Details - Stock Option Activity) - Options [Member] $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2021USD ($)$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Options outstanding, beginning balance | shares	3,446
Options granted | shares	73
Options exercised | shares	(398)
Options Forfeited | shares	(103)
Options outstanding, ending balance | shares	3,018
Options exercisable | shares	2,250
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Prices [Roll Forward]
Weighted average exercise price, options outstanding beginning balance | $ / shares	$ 5.97
Weighted average exercise price, options granted | $ / shares	22.72
Weighted average exercise price, options exercised | $ / shares	6.32
Weighted average exercise price, options Forfeited | $ / shares	4.17
Weighted average exercise price, options outstanding, ending balance | $ / shares	6.39
Weighted average exercise price, options exercisable | $ / shares	$ 6.50
Share-based Compensation Arrangement by Share-based Payment Award, Options, Weighted-Average Remaining Contractual Term [Roll Forward]
Weighted average remaining contractual term, options outstanding	6 years 5 months 16 days
Weighted average remaining contractual term, options exercisable	5 years 8 months 23 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Intrinsic Value [Roll Forward]
Intrinsic value, options outstanding ending balance | $	$ 54,736
Intrinsic value, options exercisable | $	$ 40,564

8. STOCK BASED COMPENSATION (_3

8. STOCK BASED COMPENSATION (Details - Restricted stock) - Restricted Stock [Member] shares in Thousands	3 Months Ended
	Mar. 31, 2021$ / sharesshares
Number of shares
Restricted stock outstanding, beginning balance | shares	642
Restricted stock granted | shares	71
Restricted stock vested | shares	(63)
Restricted stock Forfeited | shares	(54)
Restricted stock outstanding, ending balance | shares	596
Weighted-Average Grant Date Fair Value
Restricted stock outstanding, beginning balance | $ / shares	$ 4.43
Restricted stock granted | $ / shares	22.38
Restricted stock vested | $ / shares	4.54
Restricted stock Forfeited | $ / shares	4.81
Restricted stock outstanding, ending balance | $ / shares	$ 6.53

8. STOCK BASED COMPENSATION (_4

8. STOCK BASED COMPENSATION (Details Narrative) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
2017 Plan [Member]
Shares authorized for issuance	3,750
Restricted Stock [Member]
Restricted stock granted	71
Fair value of restricted stock granted	$ 1,600
Restricted stock Forfeited	(54)
Stock issued restricted stock awards	9
Options [Member]
Unrecognized compensation expense	$ 6,500
Unrecognized compensation weighted average period	2 years 6 months
Options granted	73
Fair value of options granted	$ 1,200
Weighted average grant date fair value per share	$ 15.94	$ 2.70

9. INCOME TAXES (Details Narrat

9. INCOME TAXES (Details Narrative) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Income Tax Disclosure [Abstract]
Income taxes expenses	$ 14	$ 0