DecisionPoint Systems (DPSIP) 10-Q 14 Nov 22 2022 Q3 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2022	Nov. 04, 2022
Document Information Line Items
Entity Registrant Name	DECISIONPOINT SYSTEMS, Inc.
Trading Symbol	DPSI
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		7,397,494
Amendment Flag	false
Entity Central Index Key	0001505611
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Document Period End Date	Sep. 30, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	333-245695
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	37-1644635
Entity Address, Address Line One	1615 South Congress Avenue Suite 103
Entity Address, City or Town	Delray Beach
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33445
City Area Code	(561)
Local Phone Number	900-3723
Title of 12(b) Security	Common Stock, $0.001 par value
Security Exchange Name	NYSE
Entity Interactive Data Current	Yes

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets(Unaudited) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
ASSETS
Cash	$ 9,447	$ 2,587
Accounts receivable, net	14,483	12,302
Inventory, net	1,415	2,111
Deferred costs	2,422	1,998
Prepaid expenses and other current assets	184	336
Total current assets	27,951	19,334
Operating lease assets	2,784	329
Property and equipment, net	1,764	834
Deferred costs, net of current portion	2,346	1,492
Deferred tax assets	1,539	1,999
Intangible assets, net	4,711	3,564
Goodwill	10,012	8,128
Other assets	16	50
Total assets	51,123	35,730
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	18,044	10,273
Accrued expenses and other current liabilities	4,098	3,220
Deferred revenue	6,664	4,599
Current portion of long-term debt	3	3
Current portion of operating lease liabilities	421	257
Total current liabilities	29,230	18,352
Deferred revenue, net of current portion	2,872	2,510
Long-term debt	143	146
Noncurrent portion of operating lease liabilities	2,639	83
Other liabilities	221	381
Total liabilities	35,105	21,472
Commitments and contingencies (Notes 6 and 10)
Stockholders’ equity:
Preferred stock, $0.001 par value; 10,000 shares authorized; no shares issued or outstanding
Common stock, $0.001 par value; 50,000 shares authorized; 7,397 and 7,007 shares issued and outstanding, respectively	7	7
Additional paid-in capital	38,292	39,216
Accumulated deficit	(22,281)	(24,965)
Total stockholders’ equity	16,018	14,258
Total liabilities and stockholders’ equity	$ 51,123	$ 35,730

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets(Unaudited) (Parentheticals) - $ / shares shares in Thousands	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Preferred stock, par value (in Dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000	10,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value (in Dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	50,000	50,000
Common stock, shares issued	7,397	7,007
Common stock, shares outstanding	7,397	7,007

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Net sales:
Product		$ 20,988	$ 14,349	$ 59,259	$ 37,846
Service		4,725	3,870	13,681	11,614
Net sales		25,713	18,219	72,940	49,460
Cost of sales:
Product		16,923	11,267	47,213	29,948
Service		3,036	2,764	8,971	7,990
Cost of sales		19,959	14,031	56,184	37,938
Gross profit		5,754	4,188	16,756	11,522
Operating expenses:
Sales and marketing expense		2,291	1,812	6,850	5,611
General and administrative expenses		1,936	1,498	6,155	4,592
Total operating expenses		4,227	3,310	13,005	10,203
Operating income		1,527	878	3,751	1,319
Interest expense		(7)	(17)	(42)	(67)
Gain on extinguishment of debt					1,211
Other expense				(17)
Income before income taxes		1,520	861	3,692	2,463
Income tax expense		(409)	(249)	(1,008)	(348)
Net income and comprehensive income attributable to common stockholders		$ 1,111	$ 612	$ 2,684	$ 2,115
Earnings per share attributable to stockholders (1):
Basic (in Dollars per share)	[1]	$ 0.15	$ 0.09	$ 0.37	$ 0.31
Diluted (in Dollars per share)	[1]	$ 0.15	$ 0.08	$ 0.36	$ 0.29
Weighted average common shares outstanding
Basic (in Shares)		7,290	6,958	7,210	6,928
Diluted (in Shares)		7,593	7,230	7,510	7,274
[1] All share and per share information has been retroactively adjusted to reflect a reverse stock split. See Note 8, Stockholders’ Equity for additional information.

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders’ Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands		Common Stock		Additional Paid-in Capital	Accumulated Deficit	Total
Balance at Dec. 31, 2020		$ 7	[1]	$ 38,236	$ (26,379)	$ 11,864
Balance (in Shares) at Dec. 31, 2020	[1]	6,788
Net income			[1]		1,333	1,333
Share-based compensation expense			[1]	33		33
Share-based compensation expense (in Shares)	[1]
Exercise of stock options			[1]	2		2
Exercise of stock options (in Shares)	[1]	2
Exercise of warrants (Note 8)			[1]
Exercise of warrants (Note 8) (in Shares)	[1]	152
Balance at Mar. 31, 2021		$ 7	[1]	38,271	(25,046)	13,232
Balance (in Shares) at Mar. 31, 2021	[1]	6,942
Net income			[1]		170	170
Share-based compensation expense			[1]	41		41
Share-based compensation expense (in Shares)	[1]
Balance at Jun. 30, 2021		$ 7	[1]	38,312	(24,876)	13,443
Balance (in Shares) at Jun. 30, 2021	[1]	6,942
Net income			[1]		612	612
Share-based compensation expense			[1]	35		35
Share-based compensation expense (in Shares)	[1]
Exercise of stock options			[1]	(25)		(25)
Balance at Sep. 30, 2021		$ 7	[1]	38,322	(24,264)	14,090
Balance (in Shares) at Sep. 30, 2021	[1]	6,942
Balance at Dec. 31, 2021		$ 7		39,216	(24,965)	14,258
Balance (in Shares) at Dec. 31, 2021		7,007
Net income					852	852
Share-based compensation expense				225		225
Cashless exercise of stock options (Note 9)				(1,403)		(1,403)
Cashless exercise of stock options (Note 9) (in Shares)		214
Balance at Mar. 31, 2022		$ 7		38,038	(24,113)	13,932
Balance (in Shares) at Mar. 31, 2022		7,221
Net income					721	721
Share-based compensation expense				50		50
Exercise of stock options				25		25
Exercise of stock options (in Shares)		13
Balance at Jun. 30, 2022		$ 7		38,113	(23,392)	14,728
Balance (in Shares) at Jun. 30, 2022		7,234
Net income					1,111	1,111
Share-based compensation expense				50		50
Exercise of stock options				129		129
Exercise of stock options (in Shares)		66
Exercise of warrants (Note 8)
Exercise of warrants (Note 8) (in Shares)		97
Balance at Sep. 30, 2022		$ 7		$ 38,292	$ (22,281)	$ 16,018
Balance (in Shares) at Sep. 30, 2022		7,397
[1] All share information and balances have been retroactively adjusted to reflect a reverse stock split. See Note 8, Stockholders’ Equity for additional information.

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash flows from operating activities
Net income	$ 2,684	$ 2,115
Adjustments to reconcile net income to net cash provided by operating activities:
Loss on fixed asset disposal	22
Depreciation and amortization	1,750	1,031
Gain on extinguishment of debt		(1,211)
Amortization of deferred financing costs		25
Share-based compensation expense	325	109
Allowance for doubtful accounts	32
Deferred income taxes, net	460	171
Changes in operating assets and liabilities:
Accounts receivable	(811)	4,548
Inventory, net	825	(267)
Deferred costs	(1,155)	(21)
Prepaid expenses and other current assets	186	(346)
Accounts payable	7,213	(3,225)
Accrued expenses and other current liabilities	(139)	(161)
Due to related parties		(34)
Operating lease liabilities	265	(5)
Deferred revenue	2,279	(504)
Net cash provided by operating activities	13,936	2,225
Cash flows from investing activities
Cash paid for acquisitions, net of cash acquired	(4,525)	(170)
Purchases of property and equipment	(1,299)	(235)
Net cash used in investing activities	(5,824)	(405)
Cash flows from financing activities
Line of credit, net		(1,206)
Payment under term loan	(3)
Taxes paid in lieu of shares issued for share-based compensation	(1,403)	(25)
Proceeds from exercise of stock options	154	2
Net cash used in financing activities	(1,252)	(1,229)
Change in cash	6,860	591
Cash, beginning of period	2,587	2,005
Cash, end of period	9,447	2,596
Supplemental disclosures of cash flow information
Cash paid for interest	38	68
Cash paid for income taxes	497	362
Non-cash investing and financing activities
Right of use assets obtained in exchange for new operating lease liabilities	3,211
Cashless exercise of stock options	$ 3,508

Description of Business

Description of Business	9 Months Ended
	Sep. 30, 2022
Description of Business [Abstract]
Description of Business	Note 1: Description of Business DecisionPoint Systems, Inc., which we sometimes refer to as the “Company”, “we” or “us”, is an enterprise mobility systems integrator that, through its subsidiaries, sells, installs, deploys and repairs mobile computing and wireless systems that are used both within a company’s facilities and in the field. These systems generally include mobile computers, mobile application software, and related data capture equipment including bar code scanners and radio frequency identification (“RFID”) readers. We also provide services, consulting, staging, kitting, deployment, maintenance, proprietary and third-party software and software customization as an integral part of our customized solutions for our customers. The suite of products utilizes the latest technologies with the intent to make complex mobile technologies easy to use, understand and keep running within all vertical markets such as merchandising, sales and delivery, field service, logistics and transportation and warehouse management. In June 2018, we acquired 100% of the outstanding stock of Royce Digital Systems, Inc. (“RDS”). RDS provides innovative enterprise print and mobile technologies, deployment services and on-site maintenance. In December 2020, we acquired 100% of the issued and outstanding membership interests of ExtenData Solutions, LLC (“ExtenData”). ExtenData is focused on enterprise mobility solutions and provides software product development, mobile computing, identification and wireless tracking solutions. In January 2022, we acquired 100% of the issued and outstanding membership interests of Advanced Mobile Group, LLC (“AMG”). AMG provides services, hardware, software, integration, and wireless networking solutions, with deep experience in warehousing and distribution, manufacturing, mobile workforce automation, retailing, and healthcare segments.

Basis of Presentation and Summa

Basis of Presentation and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2022
Basis of Presentation and Summary of Significant Accounting Policies [Abstract]
Basis of Presentation and Summary of Significant Accounting Policies	Note 2: Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation We have prepared the accompanying unaudited condensed consolidated financial statements of DecisionPoint Systems, Inc. and its subsidiaries on the accrual basis of accounting in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”). The accompanying condensed consolidated financial statements include the accounts of DecisionPoint Systems, Inc. and its wholly owned subsidiaries, DecisionPoint Systems International (“DPSI”), DecisionPoint Systems Group, Inc. (“DPS Group”), RDS, ExtenData and AMG. AMG was acquired on January 31, 2022, and as such, has been consolidated into our financial position and results of operations beginning February 1, 2022. All intercompany accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted from these interim financial statements as permitted by SEC rules and regulations. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all normal and recurring adjustments necessary to present fairly the financial condition, results of operations and cash flows for the interim periods presented. The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of results to be expected for the full fiscal year. Reverse Stock Split In December 2021, we effectuated a reverse stock split of our outstanding shares of common stock at a ratio of 1-for-2. See Note 8, Stockholders’ Equity COVID-19 COVID-19 and the response to the pandemic have, at times, negatively impacted overall economic conditions (including contributing to supply chain disruptions, labor shortages and an inflationary economic environment). The potential future impacts of COVID-19, while uncertain, could materially adversely impact the Company’s results of operations. Operating Segments Under the Financial Accounting Standards Board Accounting Standards Codification 280-10, two or more operating segments may be aggregated into a single operating segment for financial reporting purposes if aggregation is consistent with the objective and basic principles, if the segments have similar characteristics, and if the segments are similar in each of the following areas: (i) the nature of products and services, (ii) the nature of the production processes, (iii) the type or class of customer for their products and services, and (iv) the methods used to distribute their products or provide their services. We believe each of the Company’s segments meet these criteria as they provide similar products and services to similar customers using similar methods of production and distribution. Because we believe each of the criteria set forth above has been met and each of the Company’s segments has similar characteristics, we aggregate results of operations in one reportable operating segment. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Certain accounting policies involve judgments and uncertainties to such an extent that there is a reasonable likelihood that materially different amounts could have been reported under different conditions, or if different assumptions had been used. We evaluate our estimates and assumptions on a regular basis. Inventory Inventory consists solely of finished goods and is stated at the lower of cost or net realizable value. Cost is determined under the first-in, first-out (FIFO) method. We periodically review our inventory and make provisions as necessary for estimated obsolete and slow-moving goods. The creation of such provisions results in reduction of inventory to net realizable value and a charge to cost of sales. Inventories are reflected in the accompanying condensed consolidated balance sheets net of a valuation allowance of $76,000 and $59,000 as of September 30, 2022 and December 31, 2021, respectively. Income Taxes Our quarterly provision for income taxes uses an annual effective tax rate based on the expected annual income and statutory tax rates. Our effective tax rate, including discrete items as more fully described below, was 27.3% for the nine months ended September 30, 2022 and 14.1% for the nine months ended September 30, 2021. We recognize excess tax benefits (windfalls) and excess tax deficiencies (shortfalls) as discrete items in income taxes in the period that stock options are exercised. For the nine months ended September 30, 2022, we recorded an income tax benefit and deferred tax asset of $0.1 million related to excess tax benefits for stock option exercises which represents the difference in deferred tax assets recorded at fair value during the vesting period and the actual deferred tax assets realized based on the intrinsic value on the date of exercise. For the nine months ended September 30, 2022, we recorded an income tax expense of $0.2 million related to non-deductible officer’s compensation under IRC 162(m). For the nine months ended September 30, 2021, we had recorded an income tax benefit of $0.3 million related to the non-taxable PPP loan forgiveness, which is not taxable at the federal level, but may be at the state level. Operating Leases For non-cancelable operating lease agreements, operating lease assets and operating lease liabilities are established for leases with an expected term greater than one year and we recognize lease expense on a straight-line basis. We previously had an operating lease for office and warehouse space in Irvine, California with fixed minimum monthly payments of $13,945, an original lease expiration of June 2023 and an incremental borrowing rate of 4.75%. In February 2022, we reached an agreement with the lessor which allowed for an early termination of the operating lease on February 28, 2022. The monthly payments remained unchanged through February 2022, and we did not incur an early termination liability in result of the lease modification. On the date of termination, we reversed the related net book value of the operating lease asset of $0.2 million and the lease liability of $0.2 million. In connection with the closure of the office and warehouse space in Irvine, California, we entered into a new lease agreement commencing in February 2022 to relocate that office and warehouse space to Laguna Hills, California. Pursuant to the lease agreement, the base rent of $39,778 per month begins on June 1, 2022 and will increase 3% annually. The lease expires on April 30, 2029. In February 2022, we established an operating lease liability of $3.1 million and operating lease assets of $3.0 million. In connection with the new lease agreement, we entered into a sublease agreement for a portion of the Laguna Hills office and warehouse location, and we will receive $24,254 per month commencing in February 2022 with a sublease expiration of October 31, 2023. During the nine months ended September 30, 2022, we also entered into several other non-cancelable operating lease agreements with terms greater than one year and established an operating lease liability of $0.1 million and operating lease assets of $0.1 million. At September 30, 2022 the total operating lease liability was $3.1 million and the total operating lease asset was $2.8 million. Revenue Recognition We recognize revenue when a customer obtains control of promised goods or services under the terms of a contract and is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. We do not have any material extended payment terms, as payment is due at or shortly after the time of the sale. Sales, value-added and other taxes collected concurrently with revenue producing activities are excluded from revenue. We recognize contract assets or unbilled receivables related to revenue recognized for services completed but not yet invoiced to our clients. Unbilled receivables are recorded when we have an unconditional right to contract consideration. A contract liability is recognized as deferred revenue when we invoice clients, or receive customer cash payments, in advance of performing the related services under the terms of a contract. Remaining performance obligations represent the transaction price allocated to the performance obligations that are unsatisfied as of the end of each reporting period. Deferred revenue is recognized as revenue when we have satisfied the related performance obligation. As of September 30, 2022, the total aggregate transaction price allocated to the unsatisfied performance obligations was approximately $9.5 million, of which approximately $6.7 million is expected to be recognized over the next 12 months. As of December 31, 2021, the total aggregate transaction price allocated to the unsatisfied performance obligations was approximately $7.1 million. We defer costs to acquire contracts, including commissions, incentives and payroll taxes if they are incremental and recoverable costs of obtaining a customer contract with a term exceeding one year. Deferred contract costs are amortized to sales and marketing expense over the contract term, generally over one to three years. We have elected to recognize the incremental costs of obtaining a contract with a term of less than one year as a selling expense when incurred. We include deferred contract acquisition costs in “Prepaid expenses and other current assets” in the consolidated balance sheets. As of September 30, 2022 and December 31, 2021, we deferred $0.1 million and $0.1 million, respectively, of related contract acquisition costs The following table summarizes net sales by revenue source (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Hardware and software $ 19,205 $ 12,743 $ 54,105 $ 33,464 Consumables 1,783 1,606 5,154 4,382 Professional services 4,725 3,870 13,681 11,614 $ 25,713 $ 18,219 $ 72,940 $ 49,460 Accounting Standards Not Yet Adopted In September 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates There are no other accounting standards that have been issued but not yet adopted that we believe could have a material impact on our consolidated financial statements.

Acquisitions

Acquisitions	9 Months Ended
	Sep. 30, 2022
Acquisition [Abstract]
Acquisitions	Note 3: Acquisitions Advanced Mobile Group, LLC On January 31, 2022, we entered into a Membership Unit Purchase Agreement and concurrently therewith closed upon the acquisition of all of the issued and outstanding membership interests of AMG for $5.1 million. The consideration we paid is comprised of cash of $4.6 million, of which $4.4 million was paid as of September 30, 2022, and an estimated earn-out obligation valued at $0.5 million, subject to the financial performance of AMG during each of the two years following the closing of the acquisition. As a result of the acquisition, AMG became a wholly owned subsidiary of the Company. Through the end of the third quarter of 2022, we continued to refine our analysis of the estimated fair value of the acquisition purchase price (including earn-outs) and the estimated fair value of the assets acquired and liabilities assumed in the acquisition, and we expect to continue to refine this analysis into the fourth quarter of 2022. Relative to the provisional amounts recorded as of March 31, 2022, changes to the fair value of assets and liabilities assumed at the date of AMG acquisition were a result of updating the purchase price allocation and were comprised of (i) $0.9 million decrease in customer lists and relationships, (ii) a $0.2 million decrease in the trade name, (iii) a $0.1 million increase in backlog, (iv) a $0.1 million increase in developed technology, (v) a $0.1 million decrease in deferred revenue and (vi) a $0.9 million increase in goodwill. We have not yet completed our final analysis of the estimated fair value of the acquisition purchase price (including earn-outs) and the estimated fair value of the assets acquired and liabilities assumed in the acquisition. We expect that significant goodwill and definite-lived intangible assets will be recognized upon completion of the required purchase price allocation analysis. In accordance with ASC 805 Business Combinations, the provisional amounts recorded below may be adjusted in future periods as management completes its acquisition analysis. As of September 30, 2022, the allocation of the total consideration to the estimated fair value of acquired net assets as of the acquisition date for AMG is as follows (in thousands): Cash $ 170 Accounts receivable 1,402 Inventory 129 Prepaids and other current assets 123 Customer lists and relationships 1,580 Trade name 330 Backlog 260 Developed technology 60 Accounts payable (558 ) Accrued expenses (152 ) Deferred revenue (148 ) Total fair value excluding goodwill 3,196 Goodwill 1,884 Total consideration $ 5,080 The estimated useful lives of intangible assets recorded related to the AMG acquisition are as follows (in thousands): Expected Life Customer lists and relationships 7 years Trade name 3 years Backlog 11 months Developed technology 3 years Other acquisition In March 2022, we acquired the customer lists and relationships of Boston Technologies, a provider of mobile order management and route accounting software for direct store delivery (DSD) operations, for cash of $0.3 million.

Intangible Assets

Intangible Assets	9 Months Ended
	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Note 4: Intangible Assets Definite lived intangible assets are as follows (in thousands): September 30, 2022 December 31, 2021 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Customer lists and relationships $ 7,590 $ (3,442 ) $ 4,148 $ 5,690 $ (2,453 ) $ 3,237 Trade names 1,330 (895 ) 435 1,000 (699 ) 301 Developed technology 130 (73 ) 57 70 (44 ) 26 Backlog 320 (249 ) 71 60 (60 ) - $ 9,370 $ (4,659 ) $ 4,711 $ 6,820 $ (3,256 ) $ 3,564 Amortization expense recognized during the three and nine months ended September 30, 2022 was $0.5 million and $1.4 million, respectively. Amortization expense recognized during the three and nine months ended September 30, 2021 was $0.2 million and $0.8 million, respectively. Amortization expense is calculated on an accelerated basis.

Net Income Per Share

Net Income Per Share	9 Months Ended
	Sep. 30, 2022
Net Income Per Share [Abstract]
Net Income Per Share	Note 5: Net Income Per Share Basic net income per common share is computed by dividing the net income available to common stockholders by the weighted-average number of common shares outstanding. Diluted net income per share is calculated similarly to basic per share amounts, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For periods in which there is a net loss, potentially dilutive securities are excluded from the computation of fully diluted net loss per share as their effect is anti-dilutive. Below is a reconciliation of the fully dilutive securities effect for the three and nine months ended September 30, 2022 and 2021 (in thousands, except per share data): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net income attributable to common stockholders $ 1,111 $ 612 $ 2,684 $ 2,115 Weighted average basic common shares outstanding 7,290 6,958 7,210 6,928 Dilutive effect of stock options, warrants and restricted stock 303 272 300 346 Weighted average shares for diluted earnings per share 7,593 7,230 7,510 7,274 Basic income per share $ 0.15 $ 0.09 $ 0.37 $ 0.31 Diluted income per share $ 0.15 $ 0.08 $ 0.36 $ 0.29

Line of Credit

Line of Credit	9 Months Ended
	Sep. 30, 2022
Line of Credit [Abstract]
Line of Credit	Note 6: Line of Credit Our Loan and Security Agreement (the “Loan Agreement”) with MUFG Union Bank, National Association (the “Bank”) provides for a revolving line of credit of up to $9.0 million with our obligations being secured by a security interest in substantially all of our assets. Loans extended to us under the Loan Agreement are scheduled to mature on July 31, 2024. Interest and Fees Loans under the Loan Agreement with an outstanding balance of at least $150,000 bear interest, at our option, at a base interest rate equal to the London Interbank Offered Rate (“LIBOR”) plus 2.50% or a base rate equal to an index offered by the Bank for the interest period selected and is payable at the on the last day of each month. If the LIBOR rate is selected, the interest rate on the loans adjusts at the end of each LIBOR rate period (1, 2, 3, 6, or 12 month term) selected by us. All other loan amounts bear interest at a rate equal to an index rate determined by the Bank, which shall vary when the index rate changes. As of September 30, 2022, the effective interest rate was the Prime Rate of 6.25%. We have the right to prepay variable interest rate loans, in whole or in part at any time, without penalty or premium. Amounts outstanding with a base interest rate may be prepaid in whole or in part provided we have given the Bank written notice of at least five days prior to prepayment and pay a prepayment fee. At any time prior to the maturity date, we may borrow, repay and reborrow amounts under the Loan Agreement, subject to the prepayment terms, and, as long as the total outstanding does not exceed $9.0 million. The Loan Agreement requires a commitment fee of 0.25% per year, payable quarterly and in arrears, on any unused portion of the line of credit. Covenants Under the Loan Agreement, we are subject to a variety of customary affirmative and negative covenants, including that we (i) achieve a net profit of not less than $1.0 million at the end of each fiscal year, (ii) maintain a ratio of total debt to EBITDA of not greater than 3.0:1.0 measured at the end of each quarter, and (iii) not realize a net loss for more than two consecutive quarters. The Loan Agreement also prohibits us from, or otherwise imposes restrictions on us with respect to, among other things, liquidating, dissolving, entering into any consolidation, merger, division, partnership, or other combination, selling or leasing a majority of our assets or business or purchase or lease all or the greater part of the assets or business of another entity or person. As of September 30, 2022, we were in compliance with all of our covenants, were eligible to borrow up to $9.0 million, and had no outstanding borrowings under the line of credit.

Term Debt

Term Debt	9 Months Ended
	Sep. 30, 2022
Term Debt [Abstract]
Term Debt	Note 7: Term Debt EIDL Promissory Note On August 27, 2020, we received $0.2 million in connection with a promissory note from the SBA under the Economic Injury Disaster Loan (“EIDL”) program pursuant to the CARES Act. Under the terms of the EIDL promissory note, interest accrues on the outstanding principal at an interest rate of 3.75% per annum and with a term of 30 years with equal monthly payments of principal and interest of $731 beginning on August 27, 2021. As of September 30, 2022 and December 31, 2021, outstanding debt under the promissory note was $0.1 million.

Stockholders_ Equity

Stockholders’ Equity	9 Months Ended
	Sep. 30, 2022
Stockholders’ Equity [Abstract]
Stockholders’ Equity	Note 8: Stockholders’ Equity We are authorized to issue two classes of stock designated as common stock and preferred stock. As of September 30, 2022, we are authorized to issue 60,000,000 total shares of stock. Of this amount, 50,000,000 shares are designated as common stock, each having a par value of $0.001 and 10,000,000 shares are designated as preferred stock, each having a par value of $0.001. Reverse Stock Split On December 13, 2021, DecisionPoint filed a Certificate of Amendment to the Amended and Restated Certificate of Incorporation (the “Certificate of Amendment”) with the Secretary of State of Delaware to effect a 1-for-2 reverse stock split of the outstanding shares of the Company’s common stock that were outstanding at the time the Certificate of Amendment was filed (the “Reverse Stock Split”). As a result of the Reverse Stock Split, every two shares of issued and outstanding common stock were automatically combined into one issued and outstanding share of common stock, without any change in the par value per share. No fractional shares were issued as a result of the Reverse Stock Split. Any fractional shares that would otherwise have resulted from the Reverse Stock Split were rounded up to the next whole number. The Reverse Stock Split reduced the number of shares of common stock outstanding however, the number of authorized shares of common stock under the Certificate of Incorporation remained unchanged at 50 million shares. Proportionate adjustments were made to the per share exercise price and the number of shares of common stock that may be purchased upon exercise of outstanding warrants and stock options granted by the Company, and the number of shares of Common Stock reserved for future issuance under the Company’s 2014 Equity Incentive Plan, as amended (the “2014 Plan”). Warrants The following table summarizes information about our outstanding common stock warrants as of September 30, 2022: Date Strike Total Total Weighted Issued Expiration Price Exercisable (in thousands) Price Warrants - Common Stock Jun-18 Jun-23 $ 1.00 207,665 $ 208 Warrants - Common Stock Oct-18 Oct-23 1.40 21,000 29 228,665 $ 237 $ 1.04 In February 2021, the common stock warrants issued by the Company in September 2016 were fully exercised by all of the holders on a cashless basis. As a result of the cashless exercise, 151,504 shares of common stock were issued. In September 2022, a portion of the common stock warrants issued by the Company in 2018 were exercised by certain of the holders on a cashless basis. As a result of the cashless exercise, 97,408 shares of common stock were issued.

Share-Based Compensation

Share-Based Compensation	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Share-Based Compensation	Note 9: Share-Based Compensation Under our amended 2014 Plan 1,100,000 shares of our common stock are reserved for issuance under the 2014 Plan (as adjusted for the Reverse Stock Split). Under the 2014 Plan, common stock incentives may be granted to our officers, employees, directors, consultants, and advisors (and prospective directors, officers, managers, employees, consultants and advisors) and our affiliates can acquire and maintain an equity interest in us, or be paid incentive compensation, which may (but need not) be measured by reference to the value of our common stock. The 2014 Plan permits us to provide equity-based compensation in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, unrestricted stock and other stock bonus awards and performance compensation awards. The 2014 Plan is administered by the Board of Directors, or a committee appointed by the Board of Directors, which determines recipients and the number of shares subject to the awards, the exercise price and the vesting schedule. The term of stock options granted under the 2014 Plan cannot exceed ten years. Options cannot have an exercise price less than 100% of the fair market value of our common stock on the grant date, and generally vest over a period of three years. If the individual possesses more than 10% of the combined voting power of all classes of our stock, the exercise price shall not be less than 110% of the fair market of a share of common stock on the date of grant. The following table summarizes stock option activity under the 2014 Plan for the nine months ended September 30, 2022: Stock Options Grant Date Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value (in years) ($ in thousands) Outstanding at January 1, 2022 1,002,750 $ 3.00 Granted 191,250 5.47 Forfeited or expired (92,917 ) 1.58 Exercised (629,792 ) 3.29 Outstanding at September 30, 2022 471,291 $ 3.81 3.14 $ 1,350 Exercisable at September 30, 2022 259,642 $ 3.88 3.07 $ 894 During the nine months ended September 30, 2022, certain employees exercised vested stock options through a cashless exercise. The options exercised were net settled in satisfaction of the exercise price and employee share-based tax withholding. These shares were issued pursuant to an S-8 Registration Statement dated July 7, 2021 with respect to shares issuable pursuant to the 2014 Plan. The exercised options, utilizing a cashless exercise, are summarized in the following table: Options exercised Weighted Average Exercise Price Shares Net Settled for Exercise Shares Withheld for Taxes (1) Net Shares Issued Weighted Average Share Price Employee Share-Based Tax Withholding (1) 550,834 $ 3.48 194,681 142,479 213,674 $ 9.85 $ 1,403,191 (1) Shares withheld for employee taxes of 142,479 represents the equivalent shares for employee tax withholding of $1.4 million. The employee tax withholding is based on the statutory rates for each employee on the date of exercise. ASU 2016-09 clarifies that employee taxes paid in lieu of shares issued for share-based compensation should be considered similar to a share repurchase. Accordingly, employee taxes paid by us are recorded as a reduction to stockholders’ equity on the date of exercise and classified as a financing activity on the statement of cash flows when taxes are paid to the taxing authorities. Share-based compensation cost is measured at the grant date based on the fair value of the award. The fair values of stock options granted during the nine months ended September 30, 2022 were estimated using the Black-Scholes option-pricing model with the following assumptions: Weighted average grant-date fair value per option granted $ 4.15 to 9.28 Expected option term in years 2.5 to 3.2 Expected volatility factor 65.0% to 83.0 % Risk-free interest rate 0.97% to 2.85 % Expected annual dividend yield 0.0 % We estimate expected volatility using historical volatility of common stock of our peer group over a period equal to the expected life of the options. The expected term of the awards represents the period of time that the awards are expected to be outstanding. We considered expectations for the future to estimate employee exercise and post-vest termination behavior. We do not intend to pay common stock dividends in the foreseeable future, and therefore have assumed a dividend yield of zero. The risk-free interest rate is the yield on zero-coupon U.S. Treasury securities for a period that is commensurate with the expected term of the awards. As of September 30, 2022, there was $0.1 million of total unrecognized share-based compensation related to unvested stock options. These costs have a weighted average remaining recognition period of 1.1 years.

Contingencies

Contingencies	9 Months Ended
	Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
Contingencies	Note 10: Contingencies Litigation From time to time, we are subject to litigation incidental to the conduct of our business. When applicable, we record accruals for contingencies when it is probable that a liability will be incurred, and the amount of loss can be reasonably estimated. While the outcome of lawsuits and other proceedings against us cannot be predicted with certainty, in our opinion, individually or in the aggregate, no such lawsuits are expected to have a material effect on our condensed consolidated financial position or results of operations. Concentrations One customer accounted for 30% of consolidated revenue during the three months ended September 30, 2022, and 18% of consolidated revenue during the nine months ended September 30, 2022. One customer accounted for approximately 10% and 15% of consolidated net revenues during the three and nine months ended September 30, 2021, respectively. Trade accounts receivable from two customers represented 14% and 13% of net consolidated receivables at September 30, 2022 and trade accounts receivable from three customers represented approximately 19%, 12% and 11% of net consolidated receivables at September 30, 2021. Two vendors accounted for 12% and 11% of all consolidated purchases during the three months ended September 30, 2022, and three vendors accounted for 37%, 22%, and 17% of all consolidated purchased during the nine months ended September 30, 2022. For the prior year periods, these same vendors accounted for 26% and 30% of all consolidated purchases for the three months ended September 30, 2021, 24% and 14% for the nine months ended September 30, 2021. No other vendor accounted for more than 10% of purchases during the three and nine months ended September 30, 2022 and 2021. As of September 30, 2022, three vendors accounted for 31%, 27% and 22% of total accounts payable. As of September 30, 2021, the same two vendors accounted for 32% and 40% of the total accounts payable. No other vendor accounted for more than 10% of accounts payable as of September 30, 2022 and 2021. A significant decrease or interruption in business from our significant customers or vendors could have a material adverse effect on our business, financial condition and results of operations. Financial instruments that potentially expose us to a concentration of credit risk principally consist of accounts receivable. We sell product to a large number of customers in many different geographic regions. To minimize credit risk, we perform ongoing credit evaluations of our customers’ financial condition.

Accounting Policies, by Policy

Accounting Policies, by Policy (Policies)	9 Months Ended
	Sep. 30, 2022
Basis of Presentation and Summary of Significant Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation We have prepared the accompanying unaudited condensed consolidated financial statements of DecisionPoint Systems, Inc. and its subsidiaries on the accrual basis of accounting in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”). The accompanying condensed consolidated financial statements include the accounts of DecisionPoint Systems, Inc. and its wholly owned subsidiaries, DecisionPoint Systems International (“DPSI”), DecisionPoint Systems Group, Inc. (“DPS Group”), RDS, ExtenData and AMG. AMG was acquired on January 31, 2022, and as such, has been consolidated into our financial position and results of operations beginning February 1, 2022. All intercompany accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted from these interim financial statements as permitted by SEC rules and regulations. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all normal and recurring adjustments necessary to present fairly the financial condition, results of operations and cash flows for the interim periods presented. The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of results to be expected for the full fiscal year.
Reverse Stock Split	Reverse Stock Split In December 2021, we effectuated a reverse stock split of our outstanding shares of common stock at a ratio of 1-for-2. See Note 8, Stockholders’ Equity
COVID-19	COVID-19 COVID-19 and the response to the pandemic have, at times, negatively impacted overall economic conditions (including contributing to supply chain disruptions, labor shortages and an inflationary economic environment). The potential future impacts of COVID-19, while uncertain, could materially adversely impact the Company’s results of operations.
Operating Segments	Operating Segments Under the Financial Accounting Standards Board Accounting Standards Codification 280-10, two or more operating segments may be aggregated into a single operating segment for financial reporting purposes if aggregation is consistent with the objective and basic principles, if the segments have similar characteristics, and if the segments are similar in each of the following areas: (i) the nature of products and services, (ii) the nature of the production processes, (iii) the type or class of customer for their products and services, and (iv) the methods used to distribute their products or provide their services. We believe each of the Company’s segments meet these criteria as they provide similar products and services to similar customers using similar methods of production and distribution. Because we believe each of the criteria set forth above has been met and each of the Company’s segments has similar characteristics, we aggregate results of operations in one reportable operating segment.
Use of Estimates	Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Certain accounting policies involve judgments and uncertainties to such an extent that there is a reasonable likelihood that materially different amounts could have been reported under different conditions, or if different assumptions had been used. We evaluate our estimates and assumptions on a regular basis.
Inventory	Inventory Inventory consists solely of finished goods and is stated at the lower of cost or net realizable value. Cost is determined under the first-in, first-out (FIFO) method. We periodically review our inventory and make provisions as necessary for estimated obsolete and slow-moving goods. The creation of such provisions results in reduction of inventory to net realizable value and a charge to cost of sales. Inventories are reflected in the accompanying condensed consolidated balance sheets net of a valuation allowance of $76,000 and $59,000 as of September 30, 2022 and December 31, 2021, respectively.
Income Taxes	Income Taxes Our quarterly provision for income taxes uses an annual effective tax rate based on the expected annual income and statutory tax rates. Our effective tax rate, including discrete items as more fully described below, was 27.3% for the nine months ended September 30, 2022 and 14.1% for the nine months ended September 30, 2021. We recognize excess tax benefits (windfalls) and excess tax deficiencies (shortfalls) as discrete items in income taxes in the period that stock options are exercised. For the nine months ended September 30, 2022, we recorded an income tax benefit and deferred tax asset of $0.1 million related to excess tax benefits for stock option exercises which represents the difference in deferred tax assets recorded at fair value during the vesting period and the actual deferred tax assets realized based on the intrinsic value on the date of exercise. For the nine months ended September 30, 2022, we recorded an income tax expense of $0.2 million related to non-deductible officer’s compensation under IRC 162(m). For the nine months ended September 30, 2021, we had recorded an income tax benefit of $0.3 million related to the non-taxable PPP loan forgiveness, which is not taxable at the federal level, but may be at the state level.
Operating Leases	Operating Leases For non-cancelable operating lease agreements, operating lease assets and operating lease liabilities are established for leases with an expected term greater than one year and we recognize lease expense on a straight-line basis. We previously had an operating lease for office and warehouse space in Irvine, California with fixed minimum monthly payments of $13,945, an original lease expiration of June 2023 and an incremental borrowing rate of 4.75%. In February 2022, we reached an agreement with the lessor which allowed for an early termination of the operating lease on February 28, 2022. The monthly payments remained unchanged through February 2022, and we did not incur an early termination liability in result of the lease modification. On the date of termination, we reversed the related net book value of the operating lease asset of $0.2 million and the lease liability of $0.2 million. In connection with the closure of the office and warehouse space in Irvine, California, we entered into a new lease agreement commencing in February 2022 to relocate that office and warehouse space to Laguna Hills, California. Pursuant to the lease agreement, the base rent of $39,778 per month begins on June 1, 2022 and will increase 3% annually. The lease expires on April 30, 2029. In February 2022, we established an operating lease liability of $3.1 million and operating lease assets of $3.0 million. In connection with the new lease agreement, we entered into a sublease agreement for a portion of the Laguna Hills office and warehouse location, and we will receive $24,254 per month commencing in February 2022 with a sublease expiration of October 31, 2023. During the nine months ended September 30, 2022, we also entered into several other non-cancelable operating lease agreements with terms greater than one year and established an operating lease liability of $0.1 million and operating lease assets of $0.1 million. At September 30, 2022 the total operating lease liability was $3.1 million and the total operating lease asset was $2.8 million.
Revenue Recognition	Revenue Recognition We recognize revenue when a customer obtains control of promised goods or services under the terms of a contract and is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. We do not have any material extended payment terms, as payment is due at or shortly after the time of the sale. Sales, value-added and other taxes collected concurrently with revenue producing activities are excluded from revenue. We recognize contract assets or unbilled receivables related to revenue recognized for services completed but not yet invoiced to our clients. Unbilled receivables are recorded when we have an unconditional right to contract consideration. A contract liability is recognized as deferred revenue when we invoice clients, or receive customer cash payments, in advance of performing the related services under the terms of a contract. Remaining performance obligations represent the transaction price allocated to the performance obligations that are unsatisfied as of the end of each reporting period. Deferred revenue is recognized as revenue when we have satisfied the related performance obligation. As of September 30, 2022, the total aggregate transaction price allocated to the unsatisfied performance obligations was approximately $9.5 million, of which approximately $6.7 million is expected to be recognized over the next 12 months. As of December 31, 2021, the total aggregate transaction price allocated to the unsatisfied performance obligations was approximately $7.1 million. We defer costs to acquire contracts, including commissions, incentives and payroll taxes if they are incremental and recoverable costs of obtaining a customer contract with a term exceeding one year. Deferred contract costs are amortized to sales and marketing expense over the contract term, generally over one to three years. We have elected to recognize the incremental costs of obtaining a contract with a term of less than one year as a selling expense when incurred. We include deferred contract acquisition costs in “Prepaid expenses and other current assets” in the consolidated balance sheets. As of September 30, 2022 and December 31, 2021, we deferred $0.1 million and $0.1 million, respectively, of related contract acquisition costs The following table summarizes net sales by revenue source (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Hardware and software $ 19,205 $ 12,743 $ 54,105 $ 33,464 Consumables 1,783 1,606 5,154 4,382 Professional services 4,725 3,870 13,681 11,614 $ 25,713 $ 18,219 $ 72,940 $ 49,460
Accounting Standards Not Yet Adopted	Accounting Standards Not Yet Adopted In September 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates There are no other accounting standards that have been issued but not yet adopted that we believe could have a material impact on our consolidated financial statements.

Basis of Presentation and Sum_2

Basis of Presentation and Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2022
Basis of Presentation and Summary of Significant Accounting Policies [Abstract]
Schedule of net sales by revenue	Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Hardware and software $ 19,205 $ 12,743 $ 54,105 $ 33,464 Consumables 1,783 1,606 5,154 4,382 Professional services 4,725 3,870 13,681 11,614 $ 25,713 $ 18,219 $ 72,940 $ 49,460

Acquisitions (Tables)

Acquisitions (Tables)	9 Months Ended
	Sep. 30, 2022
Acquisition [Abstract]
Schedule of estimated fair value of acquired net assets	Cash $ 170 Accounts receivable 1,402 Inventory 129 Prepaids and other current assets 123 Customer lists and relationships 1,580 Trade name 330 Backlog 260 Developed technology 60 Accounts payable (558 ) Accrued expenses (152 ) Deferred revenue (148 ) Total fair value excluding goodwill 3,196 Goodwill 1,884 Total consideration $ 5,080
Schedule of estimated useful lives of intangible assets	Expected Life Customer lists and relationships 7 years Trade name 3 years Backlog 11 months Developed technology 3 years

Intangible Assets (Tables)

Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of intangible asset	September 30, 2022 December 31, 2021 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Customer lists and relationships $ 7,590 $ (3,442 ) $ 4,148 $ 5,690 $ (2,453 ) $ 3,237 Trade names 1,330 (895 ) 435 1,000 (699 ) 301 Developed technology 130 (73 ) 57 70 (44 ) 26 Backlog 320 (249 ) 71 60 (60 ) - $ 9,370 $ (4,659 ) $ 4,711 $ 6,820 $ (3,256 ) $ 3,564

Net Income Per Share (Tables)

Net Income Per Share (Tables)	9 Months Ended
	Sep. 30, 2022
Net Income Per Share [Abstract]
Schedule of reconciliation of the fully dilutive securities effect	Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net income attributable to common stockholders $ 1,111 $ 612 $ 2,684 $ 2,115 Weighted average basic common shares outstanding 7,290 6,958 7,210 6,928 Dilutive effect of stock options, warrants and restricted stock 303 272 300 346 Weighted average shares for diluted earnings per share 7,593 7,230 7,510 7,274 Basic income per share $ 0.15 $ 0.09 $ 0.37 $ 0.31 Diluted income per share $ 0.15 $ 0.08 $ 0.36 $ 0.29

Stockholders_ Equity (Tables)

Stockholders’ Equity (Tables)	9 Months Ended
	Sep. 30, 2022
Stockholders’ Equity [Abstract]
Schedule of outstanding common stock warrants	Date Strike Total Total Weighted Issued Expiration Price Exercisable (in thousands) Price Warrants - Common Stock Jun-18 Jun-23 $ 1.00 207,665 $ 208 Warrants - Common Stock Oct-18 Oct-23 1.40 21,000 29 228,665 $ 237 $ 1.04

Share-Based Compensation (Table

Share-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Schedule of stock option activity	Stock Options Grant Date Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value (in years) ($ in thousands) Outstanding at January 1, 2022 1,002,750 $ 3.00 Granted 191,250 5.47 Forfeited or expired (92,917 ) 1.58 Exercised (629,792 ) 3.29 Outstanding at September 30, 2022 471,291 $ 3.81 3.14 $ 1,350 Exercisable at September 30, 2022 259,642 $ 3.88 3.07 $ 894
Schedule of the exercised options, utilizing a cashless exercise	Options exercised Weighted Average Exercise Price Shares Net Settled for Exercise Shares Withheld for Taxes (1) Net Shares Issued Weighted Average Share Price Employee Share-Based Tax Withholding (1) 550,834 $ 3.48 194,681 142,479 213,674 $ 9.85 $ 1,403,191
Schedule of the summary of fair value using the Black-Scholes option pricing model	Weighted average grant-date fair value per option granted $ 4.15 to 9.28 Expected option term in years 2.5 to 3.2 Expected volatility factor 65.0% to 83.0 % Risk-free interest rate 0.97% to 2.85 % Expected annual dividend yield 0.0 %

Description of Business (Detail

Description of Business (Details)	Jan. 31, 2022	Dec. 31, 2020	Jun. 30, 2018
Royce Digital Systems, Inc. [Member]
Description of Business (Details) [Line Items]
Outstanding percentage			100%
ExtenData Solutions, LLC [Member]
Description of Business (Details) [Line Items]
Outstanding percentage		100%
Advanced Mobile Group, LLC [Member]
Description of Business (Details) [Line Items]
Outstanding percentage	100%

Basis of Presentation and Sum_3

Basis of Presentation and Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 28, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items]
Valuation allowance		$ 76,000		$ 76,000		$ 59,000
Effective tax rate				27.30%	14.10%
Income tax benefit and deferred tax asset				$ 100
Income tax expense		409	$ 249	1,008	$ 348
Lease income				$ 13,945
Borrowing rate percentage				4.75%
Operating lease asset	$ 200
Lease liability	200
Lease agreement rent				$ 39,778
Lease rent in percentage				3%
Operating lease liability	3,100	3,100		$ 3,100
Operating lease assets	3,000	2,784		2,784		329
Warehouse amount	$ 24,254
Operating lease assets				2,800
Unsatisfied performance obligations		9,500		9,500		7,100
Related contract acquisition costs		100		100		$ 100
Non-deductible [Member]
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items]
Income tax expense				200
PPP loan [Member]
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items]
Income tax expense					$ 300
Operating Leases [Member]
Basis of Presentation and Summary of Significant Accounting Policies (Details) [Line Items]
Operating lease liability		$ 100		100
Operating lease assets				$ 100

Basis of Presentation and Sum_4

Basis of Presentation and Summary of Significant Accounting Policies (Details) - Schedule of net sales by revenue - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Net sales	$ 25,713	$ 18,219	$ 72,940	$ 49,460
Hardware and software [Member]
Disaggregation of Revenue [Line Items]
Net sales	19,205	12,743	54,105	33,464
Consumables [Member]
Disaggregation of Revenue [Line Items]
Net sales	1,783	1,606	5,154	4,382
Professional services [Member]
Disaggregation of Revenue [Line Items]
Net sales	$ 4,725	$ 3,870	$ 13,681	$ 11,614

Acquisitions (Details)

Acquisitions (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended	9 Months Ended
	Jan. 31, 2022	Mar. 31, 2022	Sep. 30, 2022
Acquisitions (Details) [Line Items]
Consideration paid cash amount			$ 4.4
Cash		$ 0.3
Business Acquisition [Member]
Acquisitions (Details) [Line Items]
Acquisition description			Through the end of the third quarter of 2022, we continued to refine our analysis of the estimated fair value of the acquisition purchase price (including earn-outs) and the estimated fair value of the assets acquired and liabilities assumed in the acquisition, and we expect to continue to refine this analysis into the fourth quarter of 2022. Relative to the provisional amounts recorded as of March 31, 2022, changes to the fair value of assets and liabilities assumed at the date of AMG acquisition were a result of updating the purchase price allocation and were comprised of (i) $0.9 million decrease in customer lists and relationships, (ii) a $0.2 million decrease in the trade name, (iii) a $0.1 million increase in backlog, (iv) a $0.1 million increase in developed technology, (v) a $0.1 million decrease in deferred revenue and (vi) a $0.9 million increase in goodwill.
ExtenData Solutions, LLC [Member]
Acquisitions (Details) [Line Items]
Issued and outstanding membership interests	$ 5.1
Consideration paid cash amount			$ 4.6
Estimate earnout obligation			$ 0.5

Acquisitions (Details) - Schedu

Acquisitions (Details) - Schedule of estimated fair value of acquired net assets $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($)
Schedule of Estimated Fair Value of Acquired Net Assets [Abstract]
Cash	$ 170
Accounts receivable	1,402
Inventory	129
Prepaids and other current assets	123
Customer lists and relationships	1,580
Trade name	330
Backlog	260
Developed technology	60
Accounts payable	(558)
Accrued expenses	(152)
Deferred revenue	(148)
Total fair value excluding goodwill	3,196
Goodwill	1,884
Total consideration	$ 5,080

Acquisitions (Details) - Sche_2

Acquisitions (Details) - Schedule of estimated useful lives of intangible assets	9 Months Ended
	Sep. 30, 2022
Schedule of Estimated Useful Lives of Intangible Assets [Abstract]
Customer lists and relationships	7 years
Trade name	3 years
Backlog	11 months
Developed technology	3 years

Intangible Assets (Details)

Intangible Assets (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 0.5	$ 0.2	$ 1.4	$ 0.8

Intangible Assets (Details) - S

Intangible Assets (Details) - Schedule of intangible asset - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Gross Amount	$ 9,370	$ 6,820
Accumulated Amortization	(4,659)	(3,256)
Net Amount	4,711	3,564
Customer lists and relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Amount	7,590	5,690
Accumulated Amortization	(3,442)	(2,453)
Net Amount	4,148	3,237
Trade names [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Amount	1,330	1,000
Accumulated Amortization	(895)	(699)
Net Amount	435	301
Developed technology [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Amount	130	70
Accumulated Amortization	(73)	(44)
Net Amount	57	26
Backlog [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Amount	320	60
Accumulated Amortization	(249)	$ (60)
Net Amount	$ 71

Net Income Per Share (Details)

Net Income Per Share (Details) - Schedule of reconciliation of the fully dilutive securities effect - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Schedule of Reconciliation of the Fully Dilutive Securities Effect [Abstract]
Net income attributable to common stockholders (in Dollars)	$ 1,111	$ 612	$ 2,684	$ 2,115
Weighted average basic common shares outstanding	7,290	6,958	7,210	6,928
Dilutive effect of stock options, warrants and restricted stock	303	272	300	346
Weighted average shares for diluted earnings per share	7,593	7,230	7,510	7,274
Basic income per share (in Dollars per share)	$ 0.15	$ 0.09	$ 0.37	$ 0.31
Diluted income per share (in Dollars per share)	$ 0.15	$ 0.08	$ 0.36	$ 0.29

Line of Credit (Details)

Line of Credit (Details)	9 Months Ended
	Sep. 30, 2022 USD ($)
Line of Credit (Details) [Line Items]
Outstanding amount	$ 150,000
Prime rate	6.25%
Total outstanding	$ 9,000,000
Commitment fee	0.25%
Loans amounts, description	Under the Loan Agreement, we are subject to a variety of customary affirmative and negative covenants, including that we (i) achieve a net profit of not less than $1.0 million at the end of each fiscal year, (ii) maintain a ratio of total debt to EBITDA of not greater than 3.0:1.0 measured at the end of each quarter, and (iii) not realize a net loss for more than two consecutive quarters.
Eligible to borrow	$ 9,000,000
MUFG Union Bank Line of Credit [Member]
Line of Credit (Details) [Line Items]
Outstanding amount	$ 9,000,000
Maturity date	Jul. 31, 2024
LIBOR [Member]
Line of Credit (Details) [Line Items]
Interest rate	2.50%

Term Debt (Details)

Term Debt (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended	12 Months Ended
	Aug. 27, 2021	Sep. 30, 2022	Dec. 31, 2021	Aug. 27, 2020
Term Debt (Details) [Line Items]
Maturity term		3 years
Outstanding debt		$ 100	$ 100
EIDL Promissory Note [Member]
Term Debt (Details) [Line Items]
Principal amount				$ 200
Interest rate	3.75%
Maturity term	30 years
Interest amount	$ 731

Stockholders_ Equity (Details)

Stockholders’ Equity (Details) - $ / shares	1 Months Ended		9 Months Ended
	Sep. 30, 2022	Feb. 28, 2021	Sep. 30, 2022	Dec. 31, 2021
Stockholders’ Equity (Details) [Line Items]
Total number of authorized shares			60,000,000
Common stock outstanding	50,000,000		50,000,000
Common stock, par value (in Dollars per share)	$ 0.001		$ 0.001	$ 0.001
Preferred stock, shares authorized			10,000,000
Preferred stock par value (in Dollars per share)	$ 0.001		$ 0.001	$ 0.001
Unchanged shares	50,000,000		50,000,000
Common stock exercise	97,408	151,504
Common Stock [Member]
Stockholders’ Equity (Details) [Line Items]
Common stock, par value (in Dollars per share)	$ 0.001		$ 0.001

Stockholders_ Equity (Details)

Stockholders’ Equity (Details) - Schedule of outstanding common stock warrants $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($) $ / shares shares
Class of Warrant or Right [Line Items]
Total Warrants Outstanding and Exercisable | shares	228,665
Total Exercise Price | $	$ 237
Weighted Average Exercise Price | $ / shares	$ 1.04
Warrants - Common Stock [Member]
Class of Warrant or Right [Line Items]
Date - Issued	Jun-18
Date - Expiration	Jun-23
Strike Price | $ / shares	1
Total Warrants Outstanding and Exercisable | shares	207,665
Total Exercise Price | $	$ 208
Warrants - Common Stock [Member]
Class of Warrant or Right [Line Items]
Date - Issued	Oct-18
Date - Expiration	Oct-23
Strike Price | $ / shares	1.4
Total Warrants Outstanding and Exercisable | shares	21,000
Total Exercise Price | $	$ 29

Share-Based Compensation (Detai

Share-Based Compensation (Details) $ in Millions	9 Months Ended
	Sep. 30, 2022 USD ($) shares
Share-Based Compensation (Details) [Line Items]
Shares withheld for employee taxes	142,479
Shares for employee tax withholding	1,400,000
Unrecognized share related to unvested stock options | $	$ 0.1
Weighted average remaining recognition period	1 year 1 month 6 days
2014 Equity Incentive Plan (the “2014 Plan”) [Member]
Share-Based Compensation (Details) [Line Items]
Number of shares issuance	1,100,000
Term of stock option granted	10 years
Percentage of exercise price to fair market value of common stock	100%
Vest term	3 years
Percentage of voting power	10%
Fair market share of common stock	110%

Share-Based Compensation (Det_2

Share-Based Compensation (Details) - Schedule of stock option activity $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($) $ / shares shares
Schedule of Stock Option Activity [Abstract]
Outstanding, Stock options | shares	1,002,750
Outstanding, Grant Date Weighted Average Exercise Price | $ / shares	$ 3
Granted, Stock options | shares	191,250
Granted, Grant Date Weighted Average Exercise Price | $ / shares	$ 5.47
Forfeited or expired, Stock options | shares	(92,917)
Forfeited or expired, Grant Date Weighted Average Exercise Price | $ / shares	$ 1.58
Exercised, Stock options | shares	(629,792)
Exercised, Grant Date Weighted Average Exercise Price | $ / shares	$ 3.29
Outstanding, Stock options | shares	471,291
Outstanding, Grant Date Weighted Average Exercise Price | $ / shares	$ 3.81
Outstanding, Weighted Average Remaining Contractual Life	3 years 1 month 20 days
Outstanding, Aggregate Intrinsic Value | $	$ 1,350
Exercisable, Stock options | shares	259,642
Exercisable, Grant Date Weighted Average Exercise Price | $ / shares	$ 3.88
Exercisable, Weighted Average Remaining Contractual Life	3 years 25 days
Exercisable, Aggregate Intrinsic Value | $	$ 894

Share-Based Compensation (Det_3

Share-Based Compensation (Details) - Schedule of the exercised options, utilizing a cashless exercise $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($) $ / shares shares
Schedule of Exercised Options Utilizing ACashless Exercise [Abstract]
Options exercised	550,834
Weighted Average Exercise Price (in Dollars per share) | $ / shares	$ 3.48
Shares Net Settled for Exercise	194,681
Shares Withheld for Taxes	142,479	[1]
Net Shares Issued	213,674
Weighted Average Share Price (in Dollars per share) | $ / shares	$ 9.85
Employee Share-Based Tax Withholding (in Dollars) | $	$ 1,403,191	[1]
[1]Shares withheld for employee taxes of 142,479 represents the equivalent shares for employee tax withholding of $1.4 million. The employee tax withholding is based on the statutory rates for each employee on the date of exercise. ASU 2016-09 clarifies that employee taxes paid in lieu of shares issued for share-based compensation should be considered similar to a share repurchase. Accordingly, employee taxes paid by us are recorded as a reduction to stockholders’ equity on the date of exercise and classified as a financing activity on the statement of cash flows when taxes are paid to the taxing authorities.

Share-Based Compensation (Det_4

Share-Based Compensation (Details) - Schedule of the summary of fair value using the Black-Scholes option pricing model	9 Months Ended
	Sep. 30, 2022 $ / shares
Share-Based Compensation (Details) - Schedule of the summary of fair value using the Black-Scholes option pricing model [Line Items]
Expected annual dividend yield	0%
Minimum [Member]
Share-Based Compensation (Details) - Schedule of the summary of fair value using the Black-Scholes option pricing model [Line Items]
Weighted average grant-date fair value per option granted (in Dollars per share)	$ 4.15
Expected option term in years	2 years 6 months
Expected volatility factor	65%
Risk-free interest rate	0.97%
Maximum [Member]
Share-Based Compensation (Details) - Schedule of the summary of fair value using the Black-Scholes option pricing model [Line Items]
Weighted average grant-date fair value per option granted (in Dollars per share)	$ 9.28
Expected option term in years	3 years 2 months 12 days
Expected volatility factor	83%
Risk-free interest rate	2.85%

Contingencies (Details)

Contingencies (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
One Customer [Member]
Contingencies (Details) [Line Items]
Consolidated net revenues percentage	30%	10%	18%	15%
One Customer [Member] | Accounts Receivable [Member]
Contingencies (Details) [Line Items]
Net consolidated receivables percentage	14%	19%	14%	19%
Two Customers [Member] | Accounts Receivable [Member]
Contingencies (Details) [Line Items]
Net consolidated receivables percentage	13%	12%	13%	12%
Three Customers [Member] | Accounts Receivable [Member]
Contingencies (Details) [Line Items]
Net consolidated receivables percentage		11%		11%
One vendor [Member]
Contingencies (Details) [Line Items]
Consolidated purchases percentage	12%	26%	37%	24%
Account payable percentage	31%	32%	31%	32%
Two vendors [Member]
Contingencies (Details) [Line Items]
Consolidated purchases percentage	11%	30%	22%	14%
Account payable percentage	27%	40%	27%	40%
Three vendors [Member]
Contingencies (Details) [Line Items]
Consolidated purchases percentage			17%
Account payable percentage	22%		22%
Other Vendor [Member]
Contingencies (Details) [Line Items]
Consolidated purchases percentage	10%	10%	10%	10%
Account payable percentage	10%	10%	10%	10%