Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2023 | May 08, 2023 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-04321 | |
Entity Registrant Name | Movella Holdings Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 98-1575384 | |
Entity Address, Address Line One | Suite 110 | |
Entity Address, Address Line Two | 3535 Executive Terminal Drive | |
Entity Address, City or Town | Henderson | |
Entity Address, State or Province | NV | |
Entity Address, Postal Zip Code | 89052 | |
City Area Code | (725) | |
Local Phone Number | 238-5682 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 50,907,431 | |
Entity Central Index Key | 0001839132 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Common stock | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common stock, $.00001 par value per share | |
Trading Symbol | MVLA | |
Security Exchange Name | NASDAQ | |
Warrant | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Warrants, each warrant exercisable for one share of common stock at an exercise price of $11.50 | |
Trading Symbol | MVLAW | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 62,096 | $ 14,334 |
Accounts receivable, net of allowance for credit losses of $440 and $144 at March 31, 2023 and December 31, 2022 | 4,716 | 6,690 |
Inventories | 6,570 | 5,164 |
Prepaid expenses and other current assets | 5,657 | 3,274 |
Total current assets | 79,039 | 29,462 |
Noncurrent assets: | ||
Property and equipment, net | 2,362 | 2,361 |
Goodwill | 36,666 | 36,381 |
Intangible assets, net | 843 | 5,807 |
Non-marketable equity securities | 25,285 | 25,285 |
Capitalized equity issuance costs and other assets | 1,735 | 4,265 |
Deferred tax assets | 86 | 86 |
Right-of-use assets | 3,107 | 3,281 |
Total assets | 149,123 | 106,928 |
Current liabilities | ||
Accounts payable | 3,896 | 5,967 |
Accrued expenses and other current liabilities | 7,356 | 7,944 |
Line of credit and current portion of long-term debt | 148 | 148 |
Current portion of deferred revenue | 3,159 | 3,334 |
Payable to Kinduct sellers – current | 0 | 4,303 |
Total current liabilities | 14,559 | 21,696 |
Noncurrent liabilities: | ||
Long-term portion of term debt | 43,187 | 25,649 |
Convertible notes, net – related party (Note 12) | 0 | 6,186 |
Warrant liabilities | 1,513 | 0 |
Deferred revenue, net of current portion | 1,389 | 1,344 |
Operating lease liabilities and other non-current liabilities | 2,982 | 3,088 |
Total liabilities | 63,630 | 57,963 |
Commitments and contingencies (Note 13) | ||
Mezzanine equity | ||
Total mezzanine equity | 0 | 185,183 |
Stockholders’ equity (deficit) | ||
Common stock, $0.00001 par value. 900,000,000 shares authorized, 50,693,308 shares issued and outstanding at March 31, 2023; 46,430,391 shares authorized, 6,231,947 shares issued and outstanding at December 31, 2022 | 1 | 1 |
Additional paid-in capital | 206,428 | 692 |
Accumulated other comprehensive loss | (1,386) | (1,646) |
Accumulated deficit | (126,180) | (142,016) |
Total Movella stockholders’ equity (deficit) | 78,863 | (142,969) |
Non-controlling interest in subsidiaries | 6,630 | 6,751 |
Total stockholders’ equity (deficit) | 85,493 | (136,218) |
Total liabilities, mezzanine equity and stockholders’ equity (deficit) | 149,123 | 106,928 |
Redeemable Convertible Preferred Stock | ||
Mezzanine equity | ||
Total mezzanine equity | 0 | 41,991 |
Nonredeemable Convertible Preferred Stock | ||
Mezzanine equity | ||
Total mezzanine equity | $ 0 | $ 143,192 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Allowance for doubtful accounts | $ 440 | $ 144 |
Common stock: | ||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 900,000,000 | 46,430,391 |
Common stock, shares issued (in shares) | 50,693,308 | 6,231,947 |
Common stock, shares outstanding (in shares) | 50,693,308 | 6,231,947 |
Redeemable Convertible Preferred Stock | ||
Mezzanine equity | ||
Mezzanine equity, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Mezzanine equity, shares authorized (in shares) | 0 | 3,207,472 |
Mezzanine equity, shares issued (in shares) | 0 | 3,207,472 |
Mezzanine equity, shares outstanding (in shares) | 0 | 3,207,472 |
Mezzanine equity, liquidation preference | $ 30,000 | |
Nonredeemable Convertible Preferred Stock | ||
Mezzanine equity | ||
Mezzanine equity, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Mezzanine equity, shares authorized (in shares) | 20,000,000 | 29,524,294 |
Mezzanine equity, shares issued (in shares) | 0 | 24,338,566 |
Mezzanine equity, shares outstanding (in shares) | 0 | 24,338,566 |
Mezzanine equity, liquidation preference | $ 146,548 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenues | ||
Total revenues | $ 9,167 | $ 9,508 |
Cost of revenues | ||
Total cost of revenues | 3,571 | 4,702 |
Gross profit | 5,596 | 4,806 |
Operating expenses | ||
Research and development | 2,904 | 3,536 |
Sales and marketing | 3,480 | 3,440 |
General and administrative | 3,957 | 3,337 |
Impairment of intangible assets | 4,657 | 0 |
Total operating expenses | 14,998 | 10,313 |
Loss from operations | (9,402) | (5,507) |
Other income (expense) | ||
Loss on debt extinguishment | (107) | 0 |
Gain on change in fair value of warrant liabilities | 1,390 | 0 |
Debt issuance costs | (7,945) | 0 |
Revaluation of debt, net | 31,868 | 0 |
Interest expense | (172) | (400) |
Interest income | 256 | 4 |
Other income (expense), net | (115) | 83 |
Income (loss) before income taxes | 15,773 | (5,820) |
Income tax expense | (58) | (15) |
Net income (loss) | 15,715 | (5,835) |
Net loss attributable to non-controlling interests | (121) | (239) |
Net income (loss) attributable to Movella Holdings Inc. | 15,836 | (5,596) |
Deemed dividend from accretion of Series D-1 preferred stock | (316) | (659) |
Net income (loss) attributable to common stockholders, basic | $ 15,520 | $ (6,255) |
Net income (loss) per share, basic (in dollars per share) | $ 0.51 | $ (1.38) |
Net income (loss) per share, diluted (in dollars per share) | $ 0.36 | $ (1.38) |
Weighted average shares outstanding, basic (in shares) | 30,440,497 | 4,529,543 |
Weighted average shares outstanding, diluted (in shares) | 44,562,485 | 4,529,543 |
Product | ||
Revenues | ||
Total revenues | $ 7,659 | $ 8,100 |
Cost of revenues | ||
Total cost of revenues | 2,361 | 3,589 |
Service | ||
Revenues | ||
Total revenues | 1,508 | 1,408 |
Cost of revenues | ||
Total cost of revenues | $ 1,210 | $ 1,113 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 15,715 | $ (5,835) |
Other comprehensive income (loss), net of tax | ||
Foreign currency translation adjustments, net of tax | 260 | 20 |
Comprehensive income (loss) | 15,975 | (5,815) |
Comprehensive loss attributable to non-controlling interests | (121) | (239) |
Comprehensive income (loss) attributable to Movella Holdings Inc. | $ 16,096 | $ (5,576) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Mezzanine Equity and Stockholders’ Equity (Deficit) - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Accumulated deficit | Non-controlling interests | Redeemable convertible preferred stock | Non-redeemable convertible preferred stock | Preferred Stock | Preferred Stock Common stock | Preferred Stock Additional paid-in capital | Convertible Notes | Convertible Notes Common stock | Convertible Notes Additional paid-in capital | Warrant Common stock | As Previously Reported | As Previously Reported Common stock | As Previously Reported Additional paid-in capital | As Previously Reported Accumulated other comprehensive income (loss) | As Previously Reported Accumulated deficit | As Previously Reported Non-controlling interests | As Previously Reported Redeemable convertible preferred stock | As Previously Reported Non-redeemable convertible preferred stock | Adjustment Common stock | Adjustment Redeemable convertible preferred stock | Adjustment Non-redeemable convertible preferred stock |
Beginning balance, mezzanine equity, shares outstanding (in shares) at Dec. 31, 2021 | 3,207,472 | 24,335,794 | 6,562,724 | 49,792,827 | (3,355,252) | (25,457,033) | ||||||||||||||||||||
Beginning balance, mezzanine equity at Dec. 31, 2021 | $ 39,307 | $ 143,192 | $ 39,307 | $ 143,192 | ||||||||||||||||||||||
Temporary Equity [Roll Forward] | ||||||||||||||||||||||||||
Accretion of Series D-1 convertible preferred stock (in shares) | $ 659 | |||||||||||||||||||||||||
Ending balance, mezzanine equity, shares outstanding (in shares) at Mar. 31, 2022 | 3,207,472 | 24,335,794 | ||||||||||||||||||||||||
Ending balance, mezzanine equity at Mar. 31, 2022 | $ 39,966 | $ 143,192 | ||||||||||||||||||||||||
Beginning balance, common stock, shares outstanding (in shares) at Dec. 31, 2021 | 4,488,642 | 9,184,092 | (4,695,450) | |||||||||||||||||||||||
Beginning balance at Dec. 31, 2021 | $ (100,786) | $ 1 | $ 0 | $ 1,431 | $ (109,601) | $ 7,383 | $ (100,786) | $ 1 | $ 0 | $ 1,431 | $ (109,601) | $ 7,383 | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||
Stock-based compensation expense | 313 | 313 | ||||||||||||||||||||||||
Accretion of Series D-1 convertible preferred stock | 659 | 418 | 241 | |||||||||||||||||||||||
Issuance of common stock for exercise of options (in shares) | 88,217 | |||||||||||||||||||||||||
Issuance of common stock for exercise of options | 87 | 87 | ||||||||||||||||||||||||
Issuance of common stock warrants to Eastward | 18 | 18 | ||||||||||||||||||||||||
Foreign currency translation adjustment | 20 | 20 | ||||||||||||||||||||||||
Net income (loss) | (5,835) | (5,596) | (239) | |||||||||||||||||||||||
Ending balance, common stock, shares outstanding (in shares) at Mar. 31, 2022 | 4,576,859 | |||||||||||||||||||||||||
Ending balance at Mar. 31, 2022 | (106,842) | $ 1 | 0 | 1,451 | (115,438) | 7,144 | ||||||||||||||||||||
Beginning balance, mezzanine equity, shares outstanding (in shares) at Dec. 31, 2022 | 3,207,472 | 24,338,566 | 6,562,724 | 49,798,500 | (3,355,252) | (25,459,934) | ||||||||||||||||||||
Beginning balance, mezzanine equity at Dec. 31, 2022 | 185,183 | $ 41,991 | $ 143,192 | $ 41,991 | $ 143,192 | |||||||||||||||||||||
Temporary Equity [Roll Forward] | ||||||||||||||||||||||||||
Accretion of Series D-1 convertible preferred stock (in shares) | $ 316 | |||||||||||||||||||||||||
Issuance of common stock upon conversion of Preferred stock (in shares) | (3,207,472) | (24,338,566) | ||||||||||||||||||||||||
Issuance of common stock upon conversion of Preferred stock | $ (42,307) | $ (143,192) | ||||||||||||||||||||||||
Ending balance, mezzanine equity, shares outstanding (in shares) at Mar. 31, 2023 | 0 | 0 | ||||||||||||||||||||||||
Ending balance, mezzanine equity at Mar. 31, 2023 | $ 0 | $ 0 | $ 0 | |||||||||||||||||||||||
Beginning balance, common stock, shares outstanding (in shares) at Dec. 31, 2022 | 6,231,947 | 6,231,947 | 12,751,023 | (6,519,076) | ||||||||||||||||||||||
Beginning balance at Dec. 31, 2022 | $ (136,218) | $ 1 | 692 | (1,646) | (142,016) | 6,751 | $ (136,218) | $ 1 | $ 692 | $ (1,646) | $ (142,016) | $ 6,751 | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||
Stock-based compensation expense | 664 | 664 | ||||||||||||||||||||||||
Accretion of Series D-1 convertible preferred stock | $ 316 | 316 | ||||||||||||||||||||||||
Issuance of common stock for exercise of options (in shares) | 3,970 | 3,970 | ||||||||||||||||||||||||
Issuance of common stock for exercise of options | $ 10 | 10 | ||||||||||||||||||||||||
Issuance of common stock upon conversion (in shares) | 27,583,963 | 651,840 | 266,880 | |||||||||||||||||||||||
Issuance of common stock upon conversion | $ 185,499 | $ 185,499 | $ 6,520 | $ 6,520 | ||||||||||||||||||||||
Issuance of common stock in connection with business combination, net (in shares) | 15,954,708 | |||||||||||||||||||||||||
Issuance of common stock in connection with Business Combination Agreement, net of redemptions and transaction costs | 13,359 | 13,359 | ||||||||||||||||||||||||
Foreign currency translation adjustment | 260 | 260 | ||||||||||||||||||||||||
Net income (loss) | $ 15,715 | 15,836 | (121) | |||||||||||||||||||||||
Ending balance, common stock, shares outstanding (in shares) at Mar. 31, 2023 | 50,693,308 | 50,693,308 | ||||||||||||||||||||||||
Ending balance at Mar. 31, 2023 | $ 85,493 | $ 1 | $ 206,428 | $ (1,386) | $ (126,180) | $ 6,630 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Cash flows from operating activities | |||
Net income (loss) | $ 15,715 | $ (5,835) | |
Adjustments to reconcile net income (loss) to net cash used in operating activities | |||
Depreciation and amortization | 672 | 1,852 | |
Stock-based compensation expense | 664 | 313 | |
Allowance for credit losses | 296 | 0 | |
Impairment of intangible assets | 4,657 | 0 | |
Unrealized loss on marketable securities | 0 | 58 | |
Non-cash interest expense from note accretion | 61 | 76 | |
Non-cash interest expense from deferred payout accretion | 57 | 0 | |
Amortization of debt discount and debt issuance costs | 52 | 69 | |
Gain on change in fair value of warrant liabilities | (1,390) | 0 | |
Gain on revaluation of debt, net | (31,868) | 0 | |
Loss on debt extinguishment | 107 | 0 | |
Debt issuance costs | 7,945 | 0 | |
Right-of-use assets | 174 | 0 | |
Changes in operating assets and liabilities: | |||
Accounts receivable | 1,788 | 728 | |
Inventories | (1,229) | (1,063) | |
Prepaid expenses and other assets | (1,408) | (50) | |
Other assets | (1,594) | 10 | |
Accounts payable | 629 | (1,046) | |
Accrued expenses and other liabilities | (397) | (297) | |
Deferred revenue | (235) | 514 | |
Other liabilities | (136) | (74) | |
Net cash used in operating activities | (5,440) | (4,745) | |
Cash flows from investing activities | |||
Purchase of intangibles | (15) | (153) | |
Purchases of property and equipment | (191) | (215) | |
Net cash used in investing activities | (206) | (368) | |
Cash flows from financing activities | |||
Proceeds from Venture Linked Notes | 75,000 | 0 | |
Payment of debt issuance costs | (8,791) | 0 | |
Proceeds from Business Combination | 36,048 | 0 | |
Payment of equity issuance costs | (18,682) | 0 | |
Repayment of loans using proceeds from Venture Linked Notes | (25,557) | 0 | |
Proceeds from term loans and revolving line of credit, net | 0 | 943 | |
Proceeds from issuance of convertible notes | 0 | 4,873 | |
Principal payments of loans | 0 | (280) | |
Proceeds from the exercise of stock options | 10 | 87 | |
Payment of deferred payout to Kinduct sellers | (4,360) | 0 | |
Net cash provided by financing activities | 53,668 | 5,623 | |
Effect of foreign exchange rate changes on cash and equivalents | (260) | (219) | |
Net increase in cash and cash equivalents | 47,762 | 291 | |
Cash and cash equivalents | |||
Beginning of period | 14,334 | 11,166 | $ 11,166 |
End of period | 62,096 | 11,457 | $ 14,334 |
Supplemental disclosures of cash flow information | |||
Cash paid for interest | 557 | 207 | |
Cash paid for taxes, net of refunds | 59 | 47 | |
Supplemental disclosure of non-cash financing activity | |||
Accretion of Series D-1 convertible preferred Stock | 316 | 659 | |
Issuance of convertible notes in exchange for Kinduct deferred payout | 0 | 1,148 | |
Issuance of warrants to lender | 0 | 18 | |
Right-of-use assets obtained in exchange for operating lease liabilities | 0 | 4,280 | |
Acquisition of warrant liabilities | 2,903 | 0 | |
Capitalized equity issuance costs applied to proceeds | 4,248 | 0 | |
Convertible Notes | |||
Supplemental disclosure of non-cash financing activity | |||
Issuance of common stock upon conversion, value | 6,520 | 0 | |
Preferred Stock | |||
Supplemental disclosure of non-cash financing activity | |||
Issuance of common stock upon conversion, value | $ 185,499 | $ 0 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview and Summary of Significant Accounting Policies | Overview and Summary of Significant Accounting Policies Description of Business Movella Holdings Inc. ( the "Company" or "New Movella" or "Movella) is a global full-stack provider of integrated sensors, software, and analytics that enable the digitization of movement. Movella’s solutions accelerate innovation and enable our customers, partners, and users to create extraordinary outcomes. Movella powers real-time character movement in digital environments, transforms movement into digital data that provides meaningful and actionable insights, renders digitized movement to enable the creation of sophisticated and true-to-life animated content, creates new forms of monetizable IP with unique biomechanical digital content, and provides spatial movement orientation and positioning data. Partnering with leading global brands such as Electronic Arts, EPIC Games, 20th Century Studios, Netflix, Toyota, Siemens and over 2,000 customers in total, Movella currently serves the entertainment, health and sports, and automation and mobility markets. Additionally, Movella believes it is well-positioned to provide critical enabling solutions for applications in emerging high-growth markets such as the Metaverse, next-generation gaming, live streaming, digital health, and autonomous robots with recently introduced offerings and products currently in development. Movella Inc. (“Legacy Movella”) was incorporated in the state of Delaware on August 14, 2009. Previously the Company was known as mCube Inc, and on September 27, 2021, the Company was renamed to Movella TM . The Company is headquartered in Henderson, Nevada and has subsidiaries in the Netherlands, Canada, United States, Taiwan, China, and India. Merger with Pathfinder Acquisition Corporation On February 10, 2023, (the “Closing Date”), Movella Holdings Inc., a Delaware corporation (formerly known as Pathfinder Acquisition Corporation (“Pathfinder”)), consummated the previously announced business combination (the “Business Combination”) contemplated by that certain Business Combination Agreement, dated October 3, 2022 (the “Business Combination Agreement”), by and among Pathfinder, Motion Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Pathfinder (“Merger Sub”) and Movella Inc., a Delaware corporation. On the Closing Date, promptly following the consummation of the Domestication, Merger Sub merged with and into Movella (the “Merger”), with Movella continuing as the surviving company in the Merger and, after giving effect to the Merger, Movella became a wholly owned subsidiary of New Movella (the time that the Merger became effective being referred to as the “Effective Time”). Pathfinder’s Class A ordinary shares, public warrants and the Pathfinder Units were historically quoted on The Nasdaq Stock Market LLC (“Nasdaq”) under the symbols “PFDR,” “PFDRW,” and “PFDRU,” respectively. On the Closing Date, the Pathfinder Units automatically separated into the component securities and, as a result, no longer trade as a separate security. On February 13, 2023, the New Movella Common Stock and warrants began trading on Nasdaq under the symbols “MVLA” and “MVLAW,” respectively. See Note 4. Reverse Recapitalization for additional information. The Company accounted for the Business Combination as a reverse recapitalization whereby Legacy Movella was determined as the accounting acquirer and PFDR as the accounting acquiree. This determination was primarily based on: • Legacy Movella stockholders having the largest voting interest in New Movella; • the board of directors of New Movella having seven members, and Legacy Movella’s former stockholders having the ability to nominate the majority of the members of the board of directors; • Legacy Movella management continuing to hold executive management roles for the post-combination company and being responsible for the day-to-day operations; • the post-combination company assuming the Legacy Movella name; • New Movella maintaining the pre-existing Legacy Movella headquarters; and • the intended strategy of New Movella being a continuation of Legacy Movella’s strategy. Accordingly, the Business Combination was treated as the equivalent of Legacy Movella issuing stock for the net assets of Pathfinder, accompanied by a recapitalization. The net assets of Pathfinder are stated at historical cost, with no goodwill or other intangible assets recorded. While Pathfinder was the legal acquirer in the Business Combination, because Legacy Movella was determined as the accounting acquirer, the historical financial statements of Legacy Movella became the historical financial statements of the combined company, upon the consummation of the Business Combination. As a result, the financial statements included in the accompanying unaudited interim condensed consolidated financial statements reflect (i) the historical operating results of Legacy Movella prior to the Business Combination; (ii) the combined results of the Company and Legacy Movella following the closing of the Business Combination; (iii) the assets and liabilities of Legacy Movella at their historical cost; and (iv) the Company’s equity structure for all periods presented. In connection with the Business Combination, the Company has converted the equity structure for the periods prior to the Business Combination to reflect the number of shares of New Movella’s common stock issued to Legacy Movella’s stockholders in connection with the recapitalization transaction. As such, the shares, corresponding capital amounts and earnings per share, as applicable, related to Legacy Movella’s convertible preferred stock and common stock prior to the Business Combination have been retroactively converted as shares by applying the exchange ratio of approximately 0.4887 established in the Business Combination. As of March 31, 2023, the Company incurred a total of $29.2 million of business combination related costs which principally consisted of advisory, legal, other professional fees, debt discount and debt issuance costs. The Company expensed $1.6 million related to the Venture Linked Notes in the twelve months ended December 31, 2022 and an additional $7.9 million related to the Venture Linked Notes in the three months ended March 31, 2023. Upon consummation of the business combination agreement in February 2023, $19.7 million of transaction costs have been recorded as a reduction in the proceeds from the business combination. Basis of Presentation and Principles of Consolidation The information contained herein has been prepared by Movella Holdings Inc. (the “Company”) in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The condensed consolidated financial statements include the accounts of the Company, its wholly-owned and majority-owned subsidiaries, and joint ventures in which the Company is the primary beneficiary. All significant intercompany accounts and transactions have been eliminated in consolidation. The information at March 31, 2023 and the results of the Company’s operations for the three months ended March 31, 2023 and 2022 are unaudited. The condensed consolidated financial statements reflect all adjustments, consisting of only normal recurring accruals, except otherwise disclosed herein, which are, in the opinion of management, necessary for a fair statement of the results of the interim periods presented. These unaudited condensed consolidated financial statements and notes hereto should be read in conjunction with the audited financial statements and notes thereto included elsewhere herein. Certain prior period amounts were reclassified to conform to the current period presentation. These reclassifications did not affect total revenues, costs and expenses, net loss, assets, liabilities or stockholders’ deficit. Except as set forth below, the accounting policies used in preparing these unaudited condensed consolidated financial statements are the same as those described in the Company’s financial statements for the year ended December 31, 2022. There were no material changes to our significant accounting policies and estimates during the three months ended March 31, 2023 with the exception of the addition of policies relating to the FP Venture Linked Notes and assumed warrant liabilities. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for any other interim period or for the year as a whole. Liquidity The Company has prepared its condensed consolidated financial statements assuming that the Company will continue as a going concern. The Company has incurred recurring losses from operations and net cash used in operating activities including a net loss from operations of $9.4 million and net cash used in operating activities of $5.4 million for the three months ended March 31, 2023. The Company has cash, cash equivalents, and marketable securities of $62.1 million; there are restrictions on the Company’s ability to transfer cash and cash equivalents of $0.2 million held outside of the U.S. by its subsidiaries in China and $1.0 million held by its joint venture entity in China as of March 31, 2023. The continuation of the Company as a going concern is dependent upon, among other things, the continued financial support from its investors to fund operations, the ability of the Company to obtain necessary equity or debt financing, and the attainment of profitable operations. On February 10, 2023, the Company consummated the Business Combination Agreement with Pathfinder Acquisition Corporation whereby through a series of transactions, the Company received approximately $58.0 million of net cash proceeds after transaction costs and repayment of debt. See Note 4. Reverse Recapitalization for additional details. The Note Purchase Agreement also contains a financial covenant requiring the Company and its subsidiaries to achieve positive EBITDA on a consolidated basis for the most recently ended four-quarter period, commencing with the last day of the fiscal quarter ending June 30, 2024 and as of the last day of each fiscal quarter thereafter. With the cash, cash equivalents, and marketable securities on hand at March 31, 2023, the Company believes the actions it has taken, and the measures it may take in the future, will provide sufficient liquidity to fund operations and capital expenditures over the next twelve months. The Company may seek to raise additional capital, which could be in the form of loans, convertible debt or equity, to fund future operating requirements and capital expenditures. The Company’s liquidity is highly dependent on its ability to increase revenues, control operating costs, and raise additional capital. The Company continues to closely monitor expenses to assess whether any immediate changes are necessary to enhance its liquidity. There can be no assurance that the Company will be able to raise additional capital on favorable terms, or execute on any other means of improving liquidity as described above. Reclassification Certain reclassifications have been made to the Company’s condensed consolidated financial statements for the three months ended March 31, 2022 to conform to the current period’s condensed consolidated financial statement presentation. The reclassifications had no impact on total revenues, expenses, assets, liabilities, stockholders’ deficit, cash flows from operating activities, cash flows from investing activities, or cash flows from financing activities for all periods presented. Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Such estimates include, but are not limited to, measurement of valuation allowances relating to accounts receivable, inventories and deferred tax assets; estimates of future payouts for customer incentives and allowances and warranties; uncertain tax positions; incremental borrowing rates; fair values of stock-based compensation, fair value of embedded derivatives, fair value of the Venture Linked Notes, and valuation of common stock, preferred stock and warrants; estimates and assumptions used in connection with business combinations; useful lives of long-lived assets including intangible assets and property and equipment; revenue recognition; and future cash flows used to assess and test for impairment of goodwill and long-lived assets, if applicable. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Due to the Coronavirus (“COVID-19”) pandemic, there has been uncertainty and disruption in the global economy and financial markets. The Company is not aware of any specific event or circumstance that would require a material update to its estimates or judgments or an adjustment of the carrying value of its assets or liabilities as of March 31, 2023. However, these estimates may change as new events occur and additional information is obtained, as well as other factors related to COVID-19 that could result in material impacts to the Company’s condensed consolidated financial statements in future reporting periods. Significant Risks and Uncertainties The Company is subject to those risks common in the technology industry and also those risks common to early stage companies including, but not limited to, the possibility of not being able to successfully develop or market its products as forecasted, technological obsolescence, competition, dependence on key personnel and key external alliances, the successful protection of its proprietary technologies, compliance with government regulations, and the possibility of not being able to obtain additional financing when needed. Segment Reporting The Company’s Chief Executive Officer (“CEO”) is the Chief Operating Decision Maker (“CODM”). The CODM allocates resources and makes operating decisions based on financial information presented on a consolidated basis. The profitability of the Company’s product group is not a determining factor in allocating resources and the CODM does not evaluate profitability below the level of the consolidated company. Accordingly, the Company has determined that it has a single reportable segment and operating segment structure. Cash and Cash Equivalents The Company’s cash and cash equivalents consist of highly liquid investments with insignificant interest rate risk and original maturities of three months of less at the time of purchase. Cash and cash equivalents include demand deposits and money market accounts. Interest is accrued as earned. Cash and cash equivalents are recorded at cost, which approximates fair value. Approximately $3.5 million and $4.1 million of the Company’s cash and cash equivalents balance were held outside of the U.S. as of March 31, 2023 and December 31, 2022, respectively. There are restrictions on the Company’s ability to transfer cash and cash equivalents of $0.2 million held outside of the U.S. by its subsidiaries in China and $1.0 million held by its joint venture entity in China as of March 31, 2023. Debt Instruments Venture Linked Notes As permitted under ASC 825, Financial Instruments the Company has elected the fair value option to account for its Francisco Partners Venture Linked Notes (the “Venture Linked Notes”) primarily to avoid the separate recognition of certain linked instruments in the consolidated statements of operations. In accordance with ASC 825, the Company records the Venture Linked Notes at fair value with changes in fair value recorded as a component of other income (expense), net in the consolidated statements of operations and comprehensive loss. As a result of applying the fair value option, $0.8 million of direct costs and fees related to the Pre-Close Notes and $1.6 million related to the Venture Linked Notes was expensed during the year ended December 31, 2022 and an additional $7.9 million related to the Venture Linked Notes was expensed upon consummation of the Business Combination Agreement in February 2023. Deferred Payout On September 23, 2020, the Company acquired 100% of the issued and outstanding equity of Kinduct Technology, Inc. (“Kinduct”), a privately held company, in the business of developing intelligent health, fitness, and sport performance software. Related to the acquisition of Kinduct the Company agreed to three deferred cash installment payments totaling $10.0 million with a fair value of $9.4 million. The deferred payout schedule was $2.0 million due on March 23, 2021, $2.0 million due on September 23, 2021, and $6.0 million due on March 23, 2022. As of December 31, 2022, the Company had paid $4.0 million for the first two deferred cash installment payments with the remaining $6.0 million of installment payments partially satisfied with an exchange of $1.1 million owed under the deferred payout for convertible notes. See Note 5. Debt and Note 12. Related Party Transactions for more information on the convertible notes. Any amounts that were due and payable under the deferred payout agreement were accruing interest at 12% until paid in full. On December 16, 2022, the Company reached an agreement with the former owners of Kinduct to satisfy in full the remaining balance of the deferred payout, with $1.0 million paid on December 20, 2022 and quarterly installments of $0.5 million due beginning March 31, 2023 unless an Acceleration Event occurs. On February 10, 2023, an Acceleration Event occurred and the Company satisfied the deferred payout liability in full on February 13, 2023. Debt and Equity Issuance Costs Debt and equity issuance costs, which primarily consist of direct and incremental banking, legal, accounting, consulting, and printing fees relating to the merger transaction described in Note 4. Reverse Recapitalization , are allocated between the debt and equity elements of the transaction. Debt issuance costs of $7.9 million relating to the Venture Linked Notes have been expensed in the three months ended March 31, 2023, as the Company elected the fair value option for the Venture Linked Notes which closed on February 10, 2023. The Company recorded $19.7 million of equity issuance costs as a reduction in proceeds received from the business combination. Acquired Intangible Assets The Company’s intangible assets include developed technology, customer relationships, patents, trademarks and non-compete agreements. Intangible assets are stated at cost less accumulated amortization and are amortized over their estimated useful lives using the straight-line method. Acquired intangible assets and long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset group containing these assets may not be recoverable. For the three months ended March 31, 2023 and 2022, the Company recognized $4.7 million and nil, respectively, of impairment losses. Warrant Liabilities In connection with the Closing, all 596,435 Legacy Movella warrants were net exercised for 546,056 common shares of Legacy Movella which were then converted into 266,880 shares of New Movella common stock based on the Exchange Ratio of approximately 0.4887. Upon the Closing of the Business Combination, the Company assumed 6,500,000 public warrants and 4,250,000 private placement warrants that were previously issued by PFDR. Each public warrant and private placement warrant is exercisable for 1 share of New Movella common stock at an exercise price of $11.50. The Company evaluates its financial instruments, including its outstanding warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. The Company has outstanding public and private warrants, both of which do not meet the criteria for equity classification and are accounted for as liabilities. Accordingly, the Company recognizes the warrants as liabilities at fair value and adjusts the warrants to fair value at each reporting period. The warrant liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s condensed consolidated statement of operations and comprehensive loss. The fair value of the public warrants is estimated based on the quoted market price of such warrants. The fair value of the private warrants is estimated using a binomial option pricing model. For the three months ended March 31, 2023 and 2022 the Company recorded a gain on change in fair value of the warrant liabilities of $1.4 million and nil, respectively. Non-marketable Equity Securities The Company’s non-marketable equity securities primarily comprise of shares of a privately held company which the Company received in 2021 as consideration for a licensing arrangement. The Company does not have significant influence over the privately held company and these equity securities do not have readily determinable fair values, as such the Company accounted for these equity securities using a measurement alternative in accordance with ASC 321, Investments—Equity Securities , which allows entities to measure these investments at cost, less any impairment, adjusted for changes from observable price changes in orderly transactions for identifiable or similar investments of the same issuer. The Company determined that there were no transactions with observable prices related to the non-marketable equity securities, and that there were no indicators of impairment related to the non-marketable equity securities for the three months ended March 31, 2023. Preferred Stock Redemption and Classification The Series D-1 convertible redeemable preferred stock (the “Series D-1 Preferred Stock”) contained a liquidation preference whereby holders of the Series D-1 Preferred Stock were entitled to receive consideration equal to their original issue price plus all declared but unpaid dividends, prior to payment to the holders of other series of convertible preferred stock or the holders of common stock. As such, the holders of the Series D-1 Preferred Stock could receive cash entirely while the holders of subordinated equity instruments could receive nothing or cash plus other assets of the company, which is not the same form of consideration as the holders of the Series D-1 Preferred Stock. Likewise, the Series E Preferred Stock has a liquidation preference to the Series D Preferred Stock, Series C Preferred Stock, and Series B and Series A Preferred Stock. The Series D Preferred Stock has a liquidation preference to the Series C Preferred Stock, and Series B and Series A Preferred Stock. The Series C Preferred Stock has a liquidation preference to Series B and Series A Preferred Stock. The Series B and Series A Preferred Stock have a liquidation preference to the Common Stock. The Series D-1 Preferred Stock was redeemable at a price per share equal to the original issue price of $4.5713 per share, plus an amount per share equal to 8% of the original issue price for each year following the original issue date, not more than 60 days after receipt of a written notice from a majority of the Series D-1 shareholders by the Company at any time on or after September 28, 2023. As the preferred stockholders had the ability to control a majority of the votes of the board of directors, a deemed redemption could have occurred that was in the control of the preferred stockholders and outside the control of the Company, and holders of common stock may not have received the same form of consideration as the holders of the preferred stock, the Company concluded that the preferred stock was redeemable at the option of the holder and should be classified in mezzanine equity on the condensed consolidated balance sheets. Upon consummation of the Business Combination Agreement on February 10, 2023, all series of Preferred Stock converted into common stock. Refer to Note 4. Reverse Recapitalization for more information. Lease Accounting The Company determines if an arrangement is a lease at inception. The Company’s operating lease agreements are primarily for real estate and are included within right-of-use assets, net, accrued expenses and other current liabilities, and other long-term liabilities on the condensed consolidated balance sheets. The Company elected the practical expedient to combine its lease and related non-lease components for all its leases. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Variable lease payments that do not depend on an index or rate are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. The Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. ROU assets also include any lease prepayments made and exclude lease incentives. Many of the Company’s lease agreements include options to extend the lease, which are not included in the Company’s minimum lease terms unless they are reasonably certain to be exercised. Rental expense for lease payments related to operating leases is recognized on a straight-line basis over the lease term. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) to replace the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The Company adopted ASU 2016-13 on January 1, 2023 which did not have a material impact on its condensed consolidated financial statements. Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity |
Balance Sheet Components
Balance Sheet Components | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventories Inventories consisted of the following (in thousands): March 31, December 31, Raw materials $ 2,986 $ 2,758 Work-in-progress 1,231 1,132 Finished goods 2,353 1,274 $ 6,570 $ 5,164 The amount recorded as charges to cost of revenues, representing inventories considered obsolete and unsaleable was insignificant for the three months ended March 31, 2023 and 2022. Prepaid expenses and other current assets Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, Prepaid and financed insurance $ 1,513 $ — Prepaid expenses 1,409 1,029 Value added tax receivable 900 446 Contract assets — 197 Vendor prepaid 287 — Government tax receivables 1,419 1,416 Other assets 129 186 $ 5,657 $ 3,274 Property and equipment, net Property and equipment, net consists of the following (in thousands): March 31, December 31, Office equipment $ 157 $ 157 Computer hardware and software 2,081 2,017 Lab equipment 2,802 2,864 Furniture and fixtures 553 545 Leasehold improvements 1,087 1,069 Gross book value 6,680 6,652 Less: accumulated depreciation and amortization (4,318) (4,291) $ 2,362 $ 2,361 Depreciation and amortization expense on property and equipment were $0.2 million and $0.2 million for the three months ended March 31, 2023 and 2022, respectively. Accrued expenses and other current liabilities Accrued expenses and other current liabilities consists of the following (in thousands): March 31, December 31, Accrued compensation and employee benefits $ 2,189 $ 2,999 Accrued professional services 1,243 1,909 Financed insurance 912 — Accrued valued added and other taxes 508 399 Accruals for purchases received 607 751 Current operating lease liabilities 483 593 Accrued TAS legal settlement — 325 Other current liabilities 1,414 968 $ 7,356 $ 7,944 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company categorizes assets and liabilities recorded at fair value on the Company’s condensed consolidated balance sheets based upon the level of judgment associated with inputs used to measure their fair value. The categories are as follows: • Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or inputs other than quoted prices that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments. • Level 3—Inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. The carrying amount of the Company’s financial instruments including cash and cash equivalents, accounts receivable, and accounts payable approximate their respective fair values because of their short maturities, the Venture Linked Notes are carried at fair value due to the Company's election of the ASC 825 fair value option, while the convertible notes and the deferred payout owed to the sellers of Kinduct were carried at amortized cost, with the convertible notes adjusted for changes in fair value of the embedded derivative. As of March 31, 2023 and December 31, 2022, the carrying amount of the Venture Linked Notes was $42.9 million and zero, respectively. Refer to Note 5. Debt for additional information on the Venture Linked Notes. The following table sets forth the Company’s financial assets and liabilities that were measured at fair value, on a recurring basis as of March 31, 2023 (in thousands): March 31, 2023 Level 1 Level 2 Level 3 Total Financial Assets Cash equivalents Money market funds $ 50,119 $ — $ — $ 50,119 Total assets $ 50,119 $ — $ — $ 50,119 Financial Liabilities Venture Linked Notes $ — $ — $ 42,874 $ 42,874 Public warrants 876 — — 876 Private warrants — 637 — 637 Total liabilities $ 876 $ 637 $ 42,874 $ 44,387 The following table sets forth the Company’s financial assets and liabilities that were measured at fair value, on a recurring basis as of December 31, 2022 (in thousands): December 31, 2022 Level 1 Level 2 Level 3 Total Financial Assets Cash equivalents Money market funds $ 11 $ — $ — $ 11 Marketable equity securities 2 — — 2 Total assets $ 13 $ — $ — $ 13 Financial Liabilities Pre-Close Notes $ — $ — $ 25,300 $ 25,300 Embedded derivative in convertible notes — — 60 60 Total liabilities $ — $ — $ 25,360 $ 25,360 Level 1 instruments include highly liquid money market funds classified as cash equivalents and the public warrants. The Company utilized the market approach and Level 1 valuation inputs to value its money market mutual funds and the public warrants. As of March 31, 2023 and December 31, 2022, the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity. The estimated fair value of the available-for-sale marketable equity securities may not be representative of values that will be realized in the future. Level 2 instruments include the Private warrants, whose fair value is primarily determined using quoted prices for the Public warrants. Level 3 instruments include the Venture Linked Notes and the warrant liabilities assumed in connection with the Business Combination Agreement. Public Warrants The fair value of the public warrants is estimated based on the quoted market price of such warrants on the valuation date. The public warrants were initially recognized as a liability in connection with the Business Combination on February 10, 2023 at a fair value of $1.8 million. As of March 31, 2023, the estimated fair value of the public warrants was $0.9 million. The non-cash gain of $0.9 million resulting from the change in fair value of the public warrants between February 10, 2023, and March 31, 2023 is recorded in change in fair value of warrant liabilities in our consolidated statements of operations and comprehensive loss during the three months ended March 31, 2023. Private Placement Warrants The private placement warrants were initially recognized as a liability in connection with the Business Combination on February 10, 2023 at a fair value of $1.1 million and was primarily determined based on the quoted price of the public warrants. As of March 31, 2023, the estimated fair value of the private placement warrants was $0.6 million. The non-cash gain of $0.5 million resulting from the change in fair value of the private placement warrants between February 10, 2023, and March 31, 2023 is recorded in change in fair value of warrant liabilities in our consolidated statements of operations and comprehensive loss during the three months ended March 31, 2023. Venture Linked Notes The Company elected the fair value option per ASC 825 for the Venture Linked Notes, accordingly the estimated fair value of the Venture Linked Notes at March 31, 2023 was determined using a binomial lattice model with significant assumptions including Movella's stock price, dividend yield, expected volatility, the risk-free rate, the discount rate, the term of the instrument, and lattice model inputs such as movement up or down and the probability of such movements. Changes in the fair value of the Venture Linked Notes and Pre-Close Notes totaling a net gain of $31.9 million and zero for the three months ended March 31, 2023 and 2022 are included in the Company’s consolidated statement of operations within other income (expense), net within the caption “Revaluation of debt, net”. As of March 31, 2023, the $75.0 million principal amount of Venture Linked Notes had a fair value of $42.9 million. The fair value of the Venture Linked Notes was determined using a binomial lattice model with the following key assumptions: March 31, 2023 February 10, 2023 Term 4.9 years 5.0 years Stock price $1.36 per share $8.58 per share Dividend yield — % — % Expected volatility 67.5 % 67.5 % Risk-free rate 3.7 % 3.9 % Risky rate 26.6 % 25.6 % Movement up 1.15 1.15 Movement down 0.87 0.87 Probability up 47.1 % 47.1 % Probability down 52.9 % 52.9 % |
Reverse Recapitalization
Reverse Recapitalization | 3 Months Ended |
Mar. 31, 2023 | |
Reverse Recapitalization [Abstract] | |
Reverse Recapitalization | Reverse Recapitalization On February 10, 2023, Movella and Pathfinder consummated the transactions contemplated by the Business Combination Agreement. In connection with the Closing, each share of preferred stock of Legacy Movella was converted into common stock and, immediately thereafter, each share of common stock of Legacy Movella that was issued and outstanding immediately prior to the effective time of the Business Combination (other than excluded shares as contemplated by the Business Combination Agreement) was canceled and converted into the right to receive approximately 0.4887 shares (the “Exchange Ratio”) of New Movella common stock. At the Closing, each option to purchase Legacy Movella’s common stock, whether vested or unvested, was assumed and converted into an option to purchase a number of shares of New Movella common stock in the manner set forth in the Business Combination Agreement. On November 14, 2022, Movella, Wilmington Savings Fund Society, FSB, as administrative agent and collateral agent, and FP Credit Partners Phoenix II, L.P. and FP Credit Partners II, L.P., as purchasers (the “FP Purchasers”), entered into a Note Purchase Agreement (the “Note Purchase Agreement”) pursuant to which, (a) Movella issued and sold to the FP Purchasers, and the FP Purchasers purchased, the Pre-Close Notes and (b) subject to the fulfillment of certain conditions precedent (including the consummation of the Merger), Movella agreed to issue and sell to the FP Purchasers, and the FP Purchasers agreed to purchase, on the Closing Date, the Venture Linked Notes, in each case, for the consideration, as set forth in the Note Purchase Agreement. In exchange for the entry into a Transaction Support Agreement for the FP Shares, pursuant to which the FP Purchasers agreed to, among other matters, refrain from redeeming the FP Shares (outside of certain circumstances), the Note Purchase Agreement provides that Movella issued and FP purchased notes evidencing the Venture Linked Notes, the deemed proceeds of which were used to, among other things, refinance the Pre-Close Notes in their entirety. Pursuant to the Venture Linked Notes, Movella Holdings has the right, subject to certain exceptions, to cause FP to sell all or a portion of the FP Shares at any time at its sole discretion over the life of the Venture Linked Notes, and a percentage of the proceeds (which percentage is a function of when proceeds are generated, based on a predetermined schedule with a sliding scale) of any such sale shall be applied as a credit against the outstanding obligations under the Venture Linked Notes upon repayment of the Venture Linked Notes in full or a refinancing event. The Venture Linked Notes will mature five years after the Closing Date. On December 5, 2022, the FP Purchasers commenced (within the meaning of Rule 14d-2 promulgated under the Exchange Act) the Tender Offer. On the terms and subject to the conditions set forth in the Offer to Purchase and Letter of Transmittal, each dated as of December 5, 2022, the Tender Offer was due to expire at 11:59 p.m., Eastern Time, on January 4, 2023 (the “Expiration Time”). Prior to the Expiration Time, on January 4, 2023, the FP Purchasers irrevocably and unconditionally terminated the Tender Offer. As a result of this termination, no Class A ordinary shares were purchased in the Tender Offer, all Class A ordinary shares previously tendered and not withdrawn were promptly returned to tendering holders, and FP purchased 7.5 million shares of New Movella Common Stock in the FP Private Placement. In connection with the Note Purchase Agreement, Pathfinder and the FP Purchasers entered into an agreement (the “Equity Grant Agreement”) that provides for the issuance of 1.0 million shares of New Movella Common Stock by New Movella to the FP Purchasers on the Closing Date, subject to and conditioned upon the Merger occurring, and the full deemed funding of the Venture Linked Notes and the acquisition by the FP Purchasers or its affiliates of 7.5 million shares of New Movella Common Stock in the FP Private Placement. As the issuance of the 1.0 million shares under the Equity Grant Agreement was negotiated by Pathfinder concurrently with the Note Purchase Agreement and represents an obligation of Pathfinder as of the Closing, Pathfinder recognized the expense associated with the fair value of the issuance of these shares immediately prior to the consummation of the Merger. In connection with the Merger, New Movella assumed all issued and outstanding Pathfinder ordinary shares and converted the Pathfinder ordinary shares to shares of New Movella, as described further below. The Company accounted for the Business Combination as a reverse recapitalization whereby Legacy Movella was determined as the accounting acquirer and Pathfinder as the accounting acquiree. Refer to Note 1. Overview and Summary of Significant Accounting Policies , for further details. Accordingly, the Business Combination was treated as the equivalent of Legacy Movella issuing stock for the net assets of Pathfinder, accompanied by a recapitalization. The net assets of Pathfinder are stated at historical cost, with no goodwill or other intangible assets recorded. Upon the closing of the Transactions and the issuance of the Venture Linked Notes, the Company received total gross proceeds of $111.0 million, which consisted of $36.0 million from Pathfinder’s trust and $75.0 million from the Venture Linked Notes. Such gross proceeds were offset by $27.5 million of transaction costs, which principally consisted of advisory, legal and other professional fees, and were allocated to the fair value of the equity issued on the Closing Date, as detailed below, and the Venture Linked Notes and Pathfinder warrants on a relative fair value basis. The transaction costs allocated to the equity issued on the Closing Date were accounted for as a reduction in additional paid-in capital, and the transaction costs allocated to the Venture Linked Notes and Pathfinder warrants were expensed immediately on the Closing Date. Debt repayments, inclusive of accrued but unpaid interest, of $25.6 million were paid in conjunction with the Closing, which consisted of a $25.6 million repayment of the Pre-Close Notes. Upon the consummation of the Merger, New Movella adopted a single class stock structure pursuant to which the following events contemplated by the Business Combination Agreement occurred, based on Legacy Movella’s capitalization as of February 10, 2023: • All 56,361,224 issued and outstanding shares of Legacy Movella redeemable convertible preferred stock were converted into 56,438,820 shares of Legacy Movella common stock at the conversion rate as calculated pursuant to Legacy Movella’s certificate of incorporation; • All of the outstanding principal and accrued interest on the convertible notes of Legacy Movella were converted into 1,333,712 shares of Legacy Movella common stock at the conversion rate as calculated pursuant to the terms of each of the Legacy Movella convertible notes; • All 596,435 issued and outstanding warrants of Legacy Movella were net exercised in exchange for 546,056 shares of Legacy Movella common stock pursuant to the terms of the applicable warrant agreement; • All 71,077,736 issued and outstanding shares of Legacy Movella common stock (including 12,759,148 shares of Legacy Movella common stock, 56,438,820 shares of legacy Movella common stock resulting from the conversion of the Legacy Movella redeemable convertible preferred stock, 1,333,712 shares from the conversion of Legacy Movella convertible notes, and 546,056 shares from the the net exercise of Legacy Movella warrants) were converted into 34,738,600 shares of New Movella common stock (including 6,235,917 shares of Legacy Movella common stock, 27,583,963 shares of legacy Movella common stock resulting from the conversion of the Legacy Movella redeemable convertible preferred stock, 651,840 shares from the conversion of Legacy Movella convertible notes, and 266,880 shares from the the net exercise of Legacy Movella warrants) after giving effect to the Exchange Ratio of approximately 0.4887 as calculated in accordance with the Business Combination Agreement; and • All 11,637,195 granted and outstanding unexercised Legacy Movella options were converted into 5,687,048 New Movella options exercisable for shares of New Movella common stock with the same terms and vesting conditions except for the number of shares exercisable and the exercise price, each of which was adjusted by the Exchange Ratio of approximately 0.4887 as calculated in accordance with the Business Combination Agreement. In connection with the Closing of the Merger: • All 3,354,708 issued and outstanding non-redeemed Pathfinder Class A ordinary shares were converted into 3,354,708 shares of New Movella common stock on a one-for-one basis in accordance with the Business Combination Agreement. Pathfinder’s public shareholders holding 29,145,292 Pathfinder Class A ordinary shares elected to redeem their shares prior to the Closing; • Pathfinder Acquisition LLC, a Delaware limited liability company (the “Sponsor”) forfeited approximately 50.0 percent, or 4,025,000 shares of Pathfinder Class B ordinary shares held by the Sponsor (“Sponsor Shares”) at the Closing in accordance with the Sponsor Letter Agreement for no consideration. The remaining 4,100,000 issued and outstanding Pathfinder Class B ordinary shares were converted into 4,100,000 shares of New Movella common stock on a one-for-one basis in accordance with the Business Combination Agreement; • All 7,500,000 issued and outstanding FP Shares were converted into 7,500,000 shares of New Movella common stock; • All 1,000,000 shares of New Movella common stock were issued to the FP Purchasers in accordance with the Equity Grant Agreement; • All 4,250,000 issued and outstanding Pathfinder private placement warrants were converted into 4,250,000 New Movella warrants that each represent the right to acquire one share of New Movella common stock for $11.50; and |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt The following table summarizes the outstanding borrowings as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Venture Linked Notes $ 75,000 $ — Pre-Close Notes — 25,300 Convertible notes - related party — 6,345 ACOA Loans 461 497 Add: fair value of embedded derivative in convertible notes — 60 Less: unamortized debt discounts and issuance costs — (219) Less: fair value adjustment on Venture Linked Notes (32,126) — Total debt $ 43,335 $ 31,983 Classification: Line of credit and current portion of long-term debt $ 148 $ 148 Long-term portion of term debt 43,187 25,649 Convertible notes, net – related party — 6,186 Term loans Pre-Merger Senior Secured Notes and Venture Linked Notes On November 14, 2022, the Company and certain of its subsidiaries, Wilmington Savings Fund Society, FSB, as administrative agent and collateral agent, and Credit Partners II AIV, L.P. and FP Credit Partners Phoenix II AIV, L.P., as purchasers (the “ Purchasers ”), entered into a Note Purchase Agreement (the “ Note Purchase Agreement ”) pursuant to which, (a) the Company issued and sold to the Purchasers, and the Purchasers purchased, senior secured notes of the Company in an aggregate original principal amount of $25 million (the “Pre-Close Facility ” or "Pre-Close Notes"), and (b) subject to the fulfillment of certain conditions precedent (including the consummation of the Merger), the Company agreed to issue and sell to the Purchasers, and the Purchasers agreed to purchase, on the Closing Date, senior secured venture-linked notes in an aggregate original principal amount of $75 million (the “ VLN Facility ”), in each case, for the consideration (including via a deemed sale and purchase, as applicable), as set forth in the Note Purchase Agreement. The obligations of the Company under the Note Purchase Agreement are guaranteed by certain of its subsidiaries and secured by substantially all of the Company’s and such subsidiaries’ assets. Upon consummation of the Merger, New Movella will also be required to become a secured guarantor of the obligations under the Note Purchase Agreement. The commitment to provide the VLN Facility terminates upon the earliest to occur of (i) the termination of the Business Combination Agreement in accordance with its terms prior to the Closing Date and (ii) April 30, 2023, if the Merger has not been consummated on or prior to April 30, 2023 (the “ VLN Termination Date ”). The Merger was consummated on February 10, 2023 and thus the Closing Date occurred. The proceeds of the Pre-Close Facility were used, in part, to refinance certain existing debt of the Company and its subsidiaries and to pay a portion of the transaction expenses associated with the financing arrangements contemplated by the Commitment Letter (the “ FP Financing ”), with the remaining proceeds available for growth and working capital and general corporate purposes. A portion of the proceeds of the VLN Facility were used on the Closing Date to refinance the Pre-Close Facility and to pay transaction expenses associated with the FP Financing. After the Closing, the remaining proceeds of the VLN Facility are available for growth and working capital and general corporate purposes. The interest rate per annum applicable to notes under the Note Purchase Agreement is 9.25%. With respect to the notes evidencing the VLN Facility, interest is paid in kind on the last business day of each calendar quarter commencing with the calendar quarter ending immediately after the Closing Date. Interest is also payable in cash on the Closing Date or the date of any prepayment or repayment of notes (subject however, in certain cases, to the payment of a contractual return, if such contractual return is greater than the amount of all accrued and unpaid interest (other than default interest, if any)). Subject to certain exceptions in connection with certain qualified refinancing events and the repayment of the Pre-Close Facility on the Closing Date, on the date of any voluntary or mandatory prepayment or acceleration of the notes under the Note Purchase Agreement, a scheduled contractual return is required to be paid, if greater than the amount of all accrued and unpaid interest (other than default interest, if any). When such contractual return is paid, such contractual return will be deemed to constitute payment of all accrued and unpaid interest (other than default interest, if any) on the principal amount of notes so prepaid, repaid or accelerated, as applicable, including all interest on the notes that was previously paid in kind. After the Closing, New Movella will have the right, subject to certain exceptions, to cause the Grantees (or their permitted assignees) to sell all or a portion of the shares purchased by such entities in the Tender Offer and the Private Placement at any time in its sole discretion over the life of the VLN Facility, and a percentage of the proceeds (which percentage is a function of when proceeds are generated, based on a predetermined schedule with a sliding scale) of any such sale shall be applied as a credit against the outstanding obligations under of the VLN Facility upon a repayment of the VLN Facility in full or a refinancing event. The VLN Facility also contains a financial covenant requiring the Company and its subsidiaries to achieve positive EBITDA on a consolidated basis for the most recently ended four-quarter period, commencing with the last day of the fiscal quarter ending June 30, 2024 and as of the last day of each fiscal quarter thereafter. As the Closing occurred on February 10, 2023, the maturity of the VLN Facility will be five years after the Closing Date on February 10, 2028. There are no regularly scheduled amortization payments on either the Pre-Close Facility or the VLN Facility until the maturity date therefor, however, there are customary mandatory prepayment events in connection with the receipt of net proceeds from extraordinary receipts and dispositions (subject, in the case of dispositions, to certain customary exceptions and customary reinvestment rights), debt issuances and upon events specified in the Note Purchase Agreement to be a change of control, and the Pre-Close Facility is required to be refinanced in full on the Closing Date with a portion of the proceeds of the VLN Facility. The Pre-Close Facility and VLN Facility may be optionally prepaid in whole or in part. All such prepayments are required to be accompanied by accrued and unpaid interest on the amount prepaid or if greater (excluding default interest, if any), payment of the contractual return. Silicon Valley Bank (SVB) In February 2022, the Company fully repaid the amounts owed to Silicon Valley Bank (“SVB”) per the previous agreement and entered into amendments to the Loan and Security Agreement with SVB and subsequently received cash proceeds of $1.0 million and issued warrants to purchase 16,321 shares of the Company’s common stock at a purchase price of $1.58 per share. The term loan was repayable over 30 months starting October 2022 and would have matured in March 2025. The term loan bore a floating interest rate equal to the greater of the prime rate plus 1.75% per annum or 5.0% payable monthly. In the third quarter of 2022, the Company was not in compliance with the adjusted quick ratio debt covenant of the SVB term loan; SVB issued a debt covenant waiver for the breach of the covenant. On November 14, 2022, the Company repaid the SVB Loan in full using a portion of the proceeds from the Pre-Close Facility. Eastward Fund Management, LLC On December 10, 2021, the Company entered into a new loan and security agreement with Eastward in an aggregate original principal amount of $8.0 million. The proceeds were used to pay off the existing Eastward debt with the principal amount of $4.4 million and to provide working capital for business growth. The loan bore interest at prime rate plus 8.25% floating with a prime floor of 3.25%. The repayment term included the first 18 months of interest-only payments followed by 30 consecutive equal monthly installments of principal and interest payments and a final payment due upon maturity equal to 2.5% of the advance or $0.2 million. The Company had the option to prepay the entirety of the debt with written notice at least 45 days prior to such prepayment. The prepayment amount includes i) the outstanding principal plus accrued and unpaid interest plus ii) the prepayment premium, plus iii) the final payment, plus iv) all other sums, including interest at the default rate with respect to any past due amounts owed. As part of the agreement, the Company issued Eastward warrants to purchase 215,054 shares of common stock at an exercise price of $0.93 per share on December 10, 2021. On November 14, 2022 the Company repaid the Eastward Loan in full using a portion of the proceeds from the Pre-Close Facility. The Atlantic Canada Opportunities Agency loan (“ACOA” Loan) Kinduct applied for non-interest bearing, unsecured term loans with a monthly installment repayment from the Atlantic Canada Opportunities Agency (ACOA) in 2011, 2013, and 2019. These three loans are scheduled to be repaid in 2024, 2024, and 2029, respectively. In 2022, Kinduct entered into an amendment to reduce the monthly repayments to $200 for these outstanding ACOA loans for the period from July 2021 to December 2022, July 2021 to December 2022, and October 2021 to December 2022, respectively. As of March 31, 2023 and December 31, 2022, the Company had recorded a total debt of $0.5 million and $0.5 million on the accompanying condensed consolidated balance sheets related to these loans. Convertible notes – related party In March 2022, the Company entered into convertible promissory note agreements with two of its existing preferred stock investors and received aggregate cash proceeds of $4.9 million. The Company exchanged an additional $1.1 million of convertible promissory notes to the sellers of Kinduct for extinguishment of $1.1 million of the deferred payout liability owed to them. The convertible note exchange was accounted for as a troubled debt restructuring pursuant to FASB ASC Topic 470-60, Troubled Debt Restructurings by Debtors . As the future undiscounted cash flows of the Convertible notes were greater than their carrying amount, the carrying amount was not adjusted and no gain was recognized as a result of the modification of terms. Of the $1.1 million in convertible notes issued in exchange to the sellers of Kinduct, $1.0 million were issued to a related party. The convertible promissory notes shall bear an interest rate of 6.0% per annum. The outstanding principal amount and all accrued but unpaid interest on the notes shall be mandatorily converted into the Company’s common stock at a conversion price of $9.80 per share (after the effect of the Exchange Ratio of approximately 0.4887) upon the earlier of i) maturity in September 2023 or ii) the occurrence of a capital markets transaction such as an initial public offering or acquisition by a special purpose acquisition company; or upon a change of control as defined in the convertible promissory note agreements, at the discretion of the noteholder, the notes would either convert into the Company’s common stock at a conversion price of $9.80 per share, or would be repayable at 1.50 times the outstanding principal amount plus all accrued and unpaid interest. The convertible notes contained an embedded derivative that was measured at fair value on a recurring basis, with changes in fair value of the embedded derivative recorded within other income (expense) on the condensed consolidated statements of operations. Total interest expense on the convertible notes for the three months ended March 31, 2023 was $0.1 million of which $0.1 million was to related parties. On February 10, 2023, as the Company completed its Nasdaq listing which qualified as a Maturity Date of the convertible notes, 100% of the outstanding principal and accrued interest on the convertible notes was mandatorily converted into 651,840 shares of Movella common stock at $9.80 per share per the original terms of the notes, after the effect of the Exchange Ratio of approximately 0.4887. Revolving lines of credit Silicon Valley Bank (SVB) In February 2022, the Company entered into amendments to the SVB Loan Agreement with SVB that raised the maximum amount available under the revolving line of credit to $3.0 million. The principal amount outstanding under the revolving line of credit shall accrue interest at a floating per annum rate equal to the greater of 1% above the prime rate, or 4.25%. The amendment modified the borrowing base. The maximum amount available for borrowing under the revolving line of credit was 65% of eligible accounts receivable of the Company, provided that total advances made against Xsens eligible accounts receivable shall not exceed $1.5 million, the portion of the borrowing base comprised of eligible foreign accounts shall not exceed 25%, and advances made against eligible foreign accounts shall not exceed $0.8 million. On November 14, 2022, the SVB revolving line of credit agreement was terminated concurrently with the execution of the Pre-Close Notes. TD BCRS Revolving Line of Credit On June 9, 2020, the Company’s wholly-owned subsidiary Kinduct entered into a line of credit facility with TD Ameritrade Commercial Banking, Canada. The credit limit was the lesser of $1.5 million or the previous quarter’s Borrowing Base Condition. Borrowing Base Condition was calculated using the monthly recurring revenue multiplied by 5, less the amount of any statutory claims including government remittances. The interest rate was Prime Rate plus 1.55% per annum. On November 14, 2022 the Company repaid the TD BCRS Revolving Line of Credit in full using a portion of the proceeds from the Pre-Close Notes. |
Revenues
Revenues | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues A typical sales arrangement involves multiple elements, such as sales of the Company’s inertial motion sensor units, motion capture suits, software licenses, professional services, cloud-based subscription, and subscription and support services which entitles customers to unspecified upgrades, patch releases and telephone-based support. The following table depicts the disaggregation of revenue according to revenue type (in thousands): Three Months Ended March 31, 2023 2022 Revenues Product $ 7,659 $ 8,100 Service 1,508 1,408 Total Revenues $ 9,167 $ 9,508 The Company’s Product revenues are generally recognized at a point in time, while Service revenues are generally recognized over time. Revenue recognized during the three months ended March 31, 2023 from deferred revenue balances as of December 31, 2022 was $1.0 million. Revenue recognized during the three months ended March 31, 2022 from deferred revenue balances as of December 31, 2021 was $0.9 million. |
Stock-based Compensation
Stock-based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | Stock-based Compensation Stock-based compensation expense Stock-based compensation expense included in the accompanying condensed consolidated statements of operations for the three months ended March 31, 2023 and 2022 are as follows (in thousands): Three Months Ended March 31, 2023 2022 Research and development $ 219 $ 48 Sales and marketing 140 93 General and administrative 305 172 Total stock-based compensation $ 664 $ 313 Equity incentive plans In August 2009, the Company adopted an equity incentive plan (the “2009 Plan”), which was a broad-based, long-term program intended to attract, retain and motivate talented employees and align stockholder and employee interests. The 2009 Plan provided for the issuance of incentive stock options or nonqualified stock options, and restricted stock units, or RSUs to employees, officers, directors, and consultants of the Company. Under the 2009 Plan, incentive stock options could be granted with an exercise price not less than the fair value of the stock at the date of grant as determined by the Board of Directors. For incentive stock options granted to a person who, at the time of the grant, owns stock representing more than 10% of the total combined voting power of all classes of stock of the Company, the per share exercise price must be no less than 110% of the fair value on the date of the grant as determined by the Board of Directors. All awards had ten-year terms and vest and generally become fully exercisable after five years of service from the date of grant. The 2009 Plan also allowed for the issuance of restricted common stock upon early exercise of nonvested stock options subject to the repurchase right of the Company. The repurchase right lapses in accordance with the vesting schedule of the original option. Shares of restricted stock were awarded to certain senior executives of the Company and 1,348,887 restricted stock units were issued and fully vested prior to 2018. In September 2019, the board approved the 2019 Equity Incentive Plan (the “2019 Plan”) that increased the number of shares of Common Stock that are reserved and available for issuance under the 2019 Plan by 5,500,000 shares. The 2019 Plan increases the maximum number of shares that may be issued under the 2019 Plan pursuant to the exercise of “incentive stock options” as defined in Section 422 of the Internal Revenue Code of 1986, as amended. Whereas, the Board has determined to (a) terminate the 2009 Equity Incentive Plan and (b) adopt the 2019 Plan in order to continue to provide equity incentives to attract, retain and motivate eligible service providers of the Company. Stock options previously granted under the 2009 Plan will remain outstanding until either exercised or canceled. All the remaining available shares under the 2009 Plan will be allocated to the 2019 Plan. In January 2022, the board approved an increase to the number of shares of Common Stock that are reserved and available for issuance under the 2019 plan by 1,500,000 shares. In October 2022, the board approved the 2022 Stock Incentive Plan (the "2022 Plan") that became effective upon the closing of the Business Combination in February 2023. In connection with the 2022 Plan becoming effective, no further grants will be made under Movella’s 2009 Equity Incentive Plan (the “2009 Plan”) or Movella’s 2019 Equity Incentive Plan (the “2019 Plan” and, collectively with the 2009 Plan, the “Predecessor Plans”). The aggregate number of shares of New Movella Common Stock that may be issued pursuant to stock awards under the 2022 Plan will not exceed the sum of (w) 6,105,301 shares, plus (x) any shares underlying outstanding awards under the Predecessor Plans that are cancelled in exchange for an option under the 2022 Plan and that are subsequently forfeited or terminated for any reason before being exercised or becoming vested, not issued because an award is settled in cash, or withheld or reacquired to satisfy the applicable exercise, or purchase price, or a tax withholding obligation, plus (y) the number of shares which, but for the termination of the 2019 Plan immediately prior to the completion of the offering, were reserved under the 2019 Plan but not at such time issued or subject to outstanding awards under the 2019 Plan, plus (z) an annual increase on the first day of each calendar year, for a period of not more than 10 years, beginning on January 1, 2023 and ending on (and including) January 1, 2032, in an amount equal to (i) 5% of outstanding shares on the last day of the immediately preceding calendar year or (ii) such lesser amount (including zero) that the compensation committee determines for purposes of the annual increase for that calendar year. If restricted shares or shares issued upon the exercise of options are forfeited, then such shares will again become available for awards under the 2022 Plan. If stock units, options, or stock appreciation rights are forfeited or terminate for any reason before being exercised or settled, or an award is settled in cash without the delivery of shares to the holder, then the corresponding shares will again become available for awards under the 2022 Plan. Any shares withheld to satisfy the exercise price or tax withholding obligation pursuant to any award of options or stock appreciation rights will again become available for awards under the 2022 Plan. If stock units or stock appreciation rights are settled, then only the number of shares (if any) actually issued in settlement of such stock units or stock appreciation rights will reduce the number of shares available under the 2022 Plan, and the balance (including any shares withheld to cover taxes) will again become available for awards under the 2022 Plan. At March 31, 2023, there are 7,057,631 shares available for future grant under the 2022 Equity Incentive Plan. The following table summarizes the Company’s stock option activity under all plans for the three months ended March 31, 2023: Stock Options Outstanding Weighted-Average Outstanding - December 31, 2022 5,691,018 $ 2.15 Granted — $ — Exercised (3,970) $ 2.59 Cancelled (12,423) $ 3.70 Expired — $ — Balance outstanding at March 31, 2023 5,674,625 $ 2.19 Exercisable at March 31, 2023 3,552,483 $ 1.89 As of March 31, 2023, total compensation cost related to unvested stock-based awards granted to employees under the Company’s stock plan but not yet recognized were $2.8 million and is expected to be recognized on a straight-line basis over a weighted-average period of 2.31 years. 2022 Employee Stock Purchase Plan The 2022 Employee Stock Purchase Plan (the "ESPP") permits eligible employees of the Company to purchase newly issued shares of common stock, at a price equal to 85% of the lower of the fair market value on (i) the first day of the offering period or (ii) the last day of each offering period, through payroll deductions of up to 15% of their annual cash compensation. Under the ESPP, a maximum of 1,017,550 shares of common stock may be purchased by eligible employees. The shares available under the ESPP pool will increase on the first day of each calendar year by the lesser of (i) 1% of the outstanding shares of New Movella Common Stock on such date (ii) 508,775 shares and (iii) an amount (including zero) that the compensation committee determines for purposes of the annual increase for that calendar year. During the three months ended March 31, 2023 and 2022, the Company had not yet issued shares under the ESPP and accordingly recognized no share-based compensation expense related to the ESPP during the three months ended March 31, 2023 and 2022, respectively. The Company's ESPP plan is expected to begin in May 2023. The Company records stock-based compensation awards based on fair value of the stock-based awards as of the grant date using the Black-Scholes option-pricing model. The Company recognizes such costs as compensation expense on a straight-line basis over the employee’s requisite service period, which is generally five years. |
Net Income (Loss) per Share
Net Income (Loss) per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) per Share | Net Income (Loss) per Share The following table sets forth the computation of the basic and diluted net income (loss) per share attributable to common stockholders for the three months ended March 31, 2023, and 2022 (in thousands except share and per share amounts): Three Months Ended 2023 2022 Numerator: Net income (loss) attributable to common stockholders, basic $ 15,520 $ (6,255) Add: Deemed dividends from accretion of Series D-1 Preferred Stock 316 — Add: Convertible notes interest expense and loss on debt extinguishment 219 — Net income (loss) attributable to common stockholders, diluted $ 16,055 $ (6,255) Denominator: Weighted-average common shares outstanding for basic EPS 30,440,497 4,529,543 Weighted average shares from preferred stock converted into common shares 12,566,203 — Weighted average dilutive outstanding options 1,080,655 — Weighted average shares from convertible notes converted into common shares 296,949 — Weighted average Legacy Movella warrants converted into common shares 178,181 — Diluted weighted-average common shares outstanding 44,562,485 4,529,543 Net income (loss) per share: Basic net income (loss) per share attributable to common stockholders $ 0.51 $ (1.38) Diluted net income (loss) per share attributable to common stockholders $ 0.36 $ (1.38) Potentially dilutive securities that were not included in the diluted per share calculations as of March 31, 2023 and 2022 because they would be anti-dilutive were as follows: March 31, 2023 2022 Convertible preferred stock — 27,543,266 Outstanding stock options 1,682,520 7,493,066 Convertible notes(a) — 616,506 Legacy Movella Common stock warrants (1:1) — 291,502 Legacy Movella Preferred stock warrants (1:1) — 24,437 Public warrants (1:1) 6,499,961 — Private warrants (1:1) 4,250,000 — Total 12,432,481 35,968,777 (a) Assumes conversion at $9.80 per share. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Leases | LeasesThe Company has leased office spaces in U.S. locations including San Jose and Los Angeles, California, and Henderson, Nevada. Outside the U.S., leased sites include offices in Netherlands, Nova Scotia Canada, Shanghai, China, Taiwan and Hong Kong. Future minimum lease payments are under non-cancelable operating leases that expire at various dates through year 2031. Rent expense is recognized using the straight-line method over the term of the lease. The aggregate future non-cancelable minimum rental payments for the Company’s operating leases, as of March 31, 2023, are as follows (in thousands): Year ended December 31, 2023 (remainder) $ 666 2024 737 2025 561 2026 561 2027 561 2028 561 Thereafter 1,312 Total minimum operating lease payments $ 4,959 Less: Amounts representing interest (1,852) Present value of net minimum operating lease payments 3,107 Less: Current portion (483) Long-term portion of operating lease obligations $ 2,624 The components of the right-of-use assets and lease liabilities were as follows (in thousands): Balance Sheet Classification March 31, December 31, Right-of-use assets, net Right-of-use assets, net $ 3,107 $ 3,281 Current operating lease liabilities Accrued expenses and other current liabilities (483) (593) Non-current operating lease liabilities Operating lease liabilities and other non-current liabilities (2,624) (2,688) Total operating lease liabilities $ (3,107) $ (3,281) Weighted average remaining lease term (in years) 7.1 7.0 Weighted-average discount rate 14 % 14 % The components of lease cost were as follows (in thousands): Three Months Ended March 31, 2023 2022 Operating lease costs included in operating costs and expenses: Operating leases $ 361 $ 317 Supplemental cash flow information related to leases was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cash paid for amounts included in the measurement of operating lease liabilities: Operating cash flows related to operating leases $ 300 $ 366 Right-of-use assets obtained in exchange for lease liabilities: Operating leases $ — 4,280 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s income tax expense was $0.1 million and insignificant for the three months ended March 31, 2023 and 2022, respectively. The Company’s effective tax rate was less than 1% for each of the three months ended March 31, 2023 and 2022. The income tax expense consisted primarily of foreign income tax owed at certain of the Company’s international entities. The Company’s income tax expense is different than the expected expense based on statutory rates primarily due to the full valuation allowances for the majority of the entities. As of March 31, 2023, the Company had net operating loss carryforwards for federal and state income tax purposes of approximately $25.8 million and $26.5 million, respectively, which expire beginning in the year 2030 and 2029, respectively. On March 11, 2021, Congress passed, and the President signed into law, the American Rescue Plan Act, 2021 (the “ARP”), which includes certain business tax provisions. The Company does not expect the ARP to have a material impact on the Company’s effective tax rate or income tax expense for the year ending December 31, 2023. On October 28, 2021, the House Rules Committee, under the Biden Administration released new proposed tax legislation under the “Build Back Better Act” (“BBBA”) which contains potential reversals and revisions of key provisions of the 2017 Tax Cuts and Jobs Act. The BBBA, which was passed by the U.S. House of Representatives in November 2021, is proposed legislation that has not yet been enacted into law. Additionally, in late March 2022, the Biden administration proposed a 28% corporate income tax rate. The Company does not believe this will have a material impact on its effective tax rate, though it continues to monitor the Biden Administration’s proposals. The United States enacted the Tax Cuts and Jobs Act in December 2017, which requires companies to capitalize all of their R&D costs, including software development costs, incurred in tax years beginning after December 31, 2022. The Company does not believe this will have a material impact on its effective tax rate as it had no material domestic research costs in 2023. On August 16, 2022, President Biden signed the Inflation Reduction Act into law, marking the most significant action Congress has taken on clean energy and climate change in the nation's history. Effective January 1, 2023, two provisions of the Inflation Reduction Act of 2022 became effective for corporate taxpayers: the Corporate Alternative Minimum Tax (CAMT) and the 1% tax on stock buybacks. |
Geographic Information and Conc
Geographic Information and Concentrations of Risk | 3 Months Ended |
Mar. 31, 2023 | |
Risks and Uncertainties [Abstract] | |
Geographic Information and Concentrations of Risk | Geographic Information and Concentrations of Risk Concentrations of Risk Concentration of credit risk Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains a substantial portion of its cash and cash equivalents in checking and savings accounts with banks. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. The Company is exposed to credit risk in the event of default by the financial institutions holding its cash and cash equivalents to the extent recorded in the balance sheets. While the Company has not experienced any losses in such accounts, the recent failure of Silicon Valley Bank (SVB), at which the Company held cash and cash equivalents in multiple accounts, potentially exposed the Company to significant credit risk prior to the completion by the Federal Deposit Insurance Corporation of the resolution of SVB in a manner that fully protected all depositors. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company generally does not require collateral or other security in support of accounts receivable. The Company periodically reviews the need for an allowance by considering factors such as historical experience, credit quality, the age of the account receivable balances and current economic conditions that may affect a customer’s ability to pay. As of March 31, 2023 and December 31, 2022, no customer represented 10% or more of the Company’s accounts receivable balance. Concentration of customers For each of the three months ended March 31, 2023 and 2022, no customer represented 10% or more of the Company’s consolidated revenues. Concentration of suppliers For each of the three months ended March 31, 2023 and 2022, one supplier represented 31% of the Company’s inventory purchases, accounting for $1.9 million and $1.1 million in total purchases, respectively. Revenue concentrations The Company’s revenues by geographical region is as follows (in thousands): Three Months Ended March 31, 2023 2022 United States $ 2,004 $ 2,310 China 1,653 1,351 Asia, other 1,602 1,779 Europe 2,714 2,900 Other 1,194 1,168 $ 9,167 $ 9,508 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions In March 2022, the Company entered into convertible promissory note agreements with two of its existing preferred stock investors and received aggregate cash proceeds of $4.9 million. The Company exchanged an additional $1.1 million of convertible promissory notes to the sellers of Kinduct for extinguishment of $1.1 million of the deferred payout liability owed to them. The convertible note exchange was accounted for as a troubled debt restructuring pursuant to FASB ASC Topic 470-60, Troubled Debt Restructurings by Debtors . As the future undiscounted cash flows of the Convertible notes were greater than their carrying amount, the carrying amount was not adjusted and no gain was recognized as a result of the modification of terms. Of the $1.1 million in convertible notes issued in exchange to the sellers of Kinduct, $1.0 million were issued to a related party. The convertible promissory notes shall bear an interest rate of 6.0% per annum. The outstanding principal amount and all accrued but unpaid interest on the notes shall be mandatorily converted into the Company’s common stock at a conversion price of $9.80 per share (after the effect of applying the Exchange Ratio of approximately 0.4887) upon the earlier of i) maturity in September 2023 or ii) the occurrence of a capital markets transaction such as an initial public offering or acquisition by a special purpose acquisition company; or upon a change of control as defined in the convertible promissory note agreements, at the discretion of the noteholder, the notes would either convert into the Company’s common stock at a conversion price of $9.80 per share, or would be repayable at 1.5 times the outstanding principal amount plus all accrued and unpaid interest. |
Commitment and Contingencies
Commitment and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation and Asserted Claims The Company accrues for contingencies when it believes that a loss is probable and that it can reasonably estimate the amount of any such loss. Although the Company is not currently subject to any material litigation, and no material litigation is currently threatened against the Company, the Company may be subject to legal proceedings, claims and litigation, including intellectual property litigation, arising in the ordinary course of business. Such matters are subject to many uncertainties and outcomes and are not predictable with assurance. The Company accrues amounts that it believes are adequate to address any liabilities related to legal proceedings and other loss contingencies that it believes will result in a probable loss that is reasonably estimable. In February 2020, Tactical Air Support (“TAS”) filed a lawsuit in the California State Court in Los Angeles against the Company’s wholly-owned subsidiary, Xsens North America, Inc. (“Xsens North America”). In the complaint, TAS alleged tort and contract-based causes of action arising from TAS purchases of allegedly defective Xsens North America inertial measurement unit devices (“IMUs”). TAS never deployed IMUs in its military aircraft. In response, Xsens North America removed the case to the California Federal District Court in Los Angeles based upon the party’s diversity of citizenship. The Company filed a Motion to dismiss each of TAS’ alleged non-contract-based claims and its prayers for damages in excess of the approximate $40,000 TAS paid for the IMUs on multiple grounds, prohibiting such claims and limiting TAS’ alleged damages to the purchase amount paid. The Motion to dismiss alleged non-contract-based claims was granted on September 3, 2022. In December 2022, the Company entered into an agreement with TAS including mutual releases and the lawsuit was dismissed; in January 2023 the Company paid $0.3 million to TAS pursuant to the agreement, which was accrued on the December 31, 2022 condensed consolidated balance sheet. In April 2022, the Company received a demand letter concerning its alleged failure to make various payments to certain selling shareholders of Kinduct Technologies Inc. (“Kinduct Shareholders”) pursuant to the Amended and Restated Share Purchase Agreement dated as of September 10, 2020 (the “Purchase Agreement”). The Kinduct Shareholders alleged that the Issuer has breached the Purchase Agreement by failing to make certain payments by March 31, 2022. The remaining amount payable to the Kinduct Shareholders at issue in the matter was approximately $5.2 million that was recorded as a current liability in the December 31, 2022 condensed consolidated balance sheets and such amount was accruing interest at 12% per annum, pursuant to the Purchase Agreement. On December 16, 2022, the Company reached an agreement with the former owners of Kinduct to satisfy in full the remaining balance of the deferred payout, with $1.0 million paid on December 20, 2022 and quarterly installments of $0.5 million due beginning March 31, 2023 unless an Acceleration Event occurs. On February 10, 2023, an Acceleration Event occurred and the Company satisfied the deferred payout liability in full on February 13, 2023. Indemnification The Company has entered into agreements with its current and former executives and directors indemnifying them against certain liabilities incurred in connection with the performance of their duties. The Company’s Certificate of Incorporation and Bylaws contain comparable indemnification obligations with respect to the Company’s current directors and employees. In the normal course of business, the Company periodically enters into agreements that require the Company to indemnify and defend its customers for, among other things, claims alleging that the Company’s products infringe third-party patents or other intellectual property rights as well as personal injury or property damage. The Company’s maximum exposure under these indemnification provisions cannot be estimated but the Company does not believe that there are any matters individually or collectively that would have a material adverse effect on its condensed consolidated results of operations or financial condition. |
Overview and Summary of Signifi
Overview and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation and Principles of Consolidation The information contained herein has been prepared by Movella Holdings Inc. (the “Company”) in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The condensed consolidated financial statements include the accounts of the Company, its wholly-owned and majority-owned subsidiaries, and joint ventures in which the Company is the primary beneficiary. |
Consolidation | All significant intercompany accounts and transactions have been eliminated in consolidation. |
Reclassification | ReclassificationCertain reclassifications have been made to the Company’s condensed consolidated financial statements for the three months ended March 31, 2022 to conform to the current period’s condensed consolidated financial statement presentation. The reclassifications had no impact on total revenues, expenses, assets, liabilities, stockholders’ deficit, cash flows from operating activities, cash flows from investing activities, or cash flows from financing activities for all periods presented. |
Use of Estimates | Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Such estimates include, but are not limited to, measurement of valuation allowances relating to accounts receivable, inventories and deferred tax assets; estimates of future payouts for customer incentives and allowances and warranties; uncertain tax positions; incremental borrowing rates; fair values of stock-based compensation, fair value of embedded derivatives, fair value of the Venture Linked Notes, and valuation of common stock, preferred stock and warrants; estimates and assumptions used in connection with business combinations; useful lives of long-lived assets including intangible assets and property and equipment; revenue recognition; and future cash flows used to assess and test for impairment of goodwill and long-lived assets, if applicable. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. |
Segment Reporting | Segment Reporting The Company’s Chief Executive Officer (“CEO”) is the Chief Operating Decision Maker (“CODM”). The CODM allocates resources and makes operating decisions based on financial information presented on a consolidated basis. The profitability of the Company’s product group is not a determining factor in allocating resources and the CODM does not evaluate profitability below the level of the consolidated company. Accordingly, the Company has determined that it has a single reportable segment and operating segment structure. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company’s cash and cash equivalents consist of highly liquid investments with insignificant interest rate risk and original maturities of three months of less at the time of purchase. Cash and cash equivalents include demand deposits and money market accounts. Interest is accrued as earned. Cash and cash equivalents are recorded at cost, which approximates fair value. |
Debt Instruments | Debt Instruments Venture Linked Notes As permitted under ASC 825, Financial Instruments Debt and equity issuance costs, which primarily consist of direct and incremental banking, legal, accounting, consulting, and printing fees relating to the merger transaction described in Note 4. Reverse Recapitalization |
Deferred Payout | Deferred Payout On September 23, 2020, the Company acquired 100% of the issued and outstanding equity of Kinduct Technology, Inc. (“Kinduct”), a privately held company, in the business of developing intelligent health, fitness, and sport performance software. Related to the acquisition of Kinduct the Company agreed to three deferred cash installment payments totaling $10.0 million with a fair value of $9.4 million. The deferred payout schedule was $2.0 million due on March 23, 2021, $2.0 million due on September 23, 2021, and $6.0 million due on March 23, 2022. As of December 31, 2022, the Company had paid $4.0 million for the first two deferred cash installment payments with the remaining $6.0 million of installment payments partially satisfied with an exchange of $1.1 million owed under the deferred payout for convertible notes. See Note 5. Debt and Note 12. Related Party Transactions |
Debt and Equity Issuance Costs | Debt Instruments Venture Linked Notes As permitted under ASC 825, Financial Instruments Debt and equity issuance costs, which primarily consist of direct and incremental banking, legal, accounting, consulting, and printing fees relating to the merger transaction described in Note 4. Reverse Recapitalization |
Acquired Intangible Assets | Acquired Intangible AssetsThe Company’s intangible assets include developed technology, customer relationships, patents, trademarks and non-compete agreements. Intangible assets are stated at cost less accumulated amortization and are amortized over their estimated useful lives using the straight-line method. Acquired intangible assets and long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset group containing these assets may not be recoverable. |
Warrant Liabilities | Warrant Liabilities In connection with the Closing, all 596,435 Legacy Movella warrants were net exercised for 546,056 common shares of Legacy Movella which were then converted into 266,880 shares of New Movella common stock based on the Exchange Ratio of approximately 0.4887. Upon the Closing of the Business Combination, the Company assumed 6,500,000 public warrants and 4,250,000 private placement warrants that were previously issued by PFDR. Each public warrant and private placement warrant is exercisable for 1 share of New Movella common stock at an exercise price of $11.50. |
Non-marketable Equity Securities | Non-marketable Equity Securities The Company’s non-marketable equity securities primarily comprise of shares of a privately held company which the Company received in 2021 as consideration for a licensing arrangement. The Company does not have significant influence over the privately held company and these equity securities do not have readily determinable fair values, as such the Company accounted for these equity securities using a measurement alternative in accordance with ASC 321, Investments—Equity Securities , which allows entities to measure these investments at cost, less any impairment, adjusted for changes from observable price changes in orderly transactions for identifiable or similar investments of the same issuer. The Company determined that there were no transactions with observable prices related to the non-marketable equity securities, and that there were no indicators of impairment related to the non-marketable equity securities for the three months ended March 31, 2023. |
Preferred Stock Redemption and Classification | Preferred Stock Redemption and Classification The Series D-1 convertible redeemable preferred stock (the “Series D-1 Preferred Stock”) contained a liquidation preference whereby holders of the Series D-1 Preferred Stock were entitled to receive consideration equal to their original issue price plus all declared but unpaid dividends, prior to payment to the holders of other series of convertible preferred stock or the holders of common stock. As such, the holders of the Series D-1 Preferred Stock could receive cash entirely while the holders of subordinated equity instruments could receive nothing or cash plus other assets of the company, which is not the same form of consideration as the holders of the Series D-1 Preferred Stock. Likewise, the Series E Preferred Stock has a liquidation preference to the Series D Preferred Stock, Series C Preferred Stock, and Series B and Series A Preferred Stock. The Series D Preferred Stock has a liquidation preference to the Series C Preferred Stock, and Series B and Series A Preferred Stock. The Series C Preferred Stock has a liquidation preference to Series B and Series A Preferred Stock. The Series B and Series A Preferred Stock have a liquidation preference to the Common Stock. The Series D-1 Preferred Stock was redeemable at a price per share equal to the original issue price of $4.5713 per share, plus an amount per share equal to 8% of the original issue price for each year following the original issue date, not more than 60 days after receipt of a written notice from a majority of the Series D-1 shareholders by the Company at any time on or after September 28, 2023. As the preferred stockholders had the ability to control a majority of the votes of the board of directors, a deemed redemption could have occurred that was in the control of the preferred stockholders and outside the control of the Company, and holders of common stock may not have received the same form of consideration as the holders of the preferred stock, the Company concluded that the preferred stock was redeemable at the option of the holder and should be classified in mezzanine equity on the condensed consolidated balance sheets. Upon consummation of the Business Combination Agreement on February 10, 2023, all series of Preferred Stock converted into common stock. Refer to Note 4. Reverse Recapitalization |
Lease Accounting | Lease Accounting The Company determines if an arrangement is a lease at inception. The Company’s operating lease agreements are primarily for real estate and are included within right-of-use assets, net, accrued expenses and other current liabilities, and other long-term liabilities on the condensed consolidated balance sheets. The Company elected the practical expedient to combine its lease and related non-lease components for all its leases. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Variable lease payments that do not depend on an index or rate are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. The Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. ROU assets also include any lease prepayments made and exclude lease incentives. Many of the Company’s lease agreements include options to extend the lease, which are not included in the Company’s minimum lease terms unless they are reasonably certain to be exercised. Rental expense for lease payments related to operating leases is recognized on a straight-line basis over the lease term. |
Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) to replace the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The Company adopted ASU 2016-13 on January 1, 2023 which did not have a material impact on its condensed consolidated financial statements. Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventories | Inventories consisted of the following (in thousands): March 31, December 31, Raw materials $ 2,986 $ 2,758 Work-in-progress 1,231 1,132 Finished goods 2,353 1,274 $ 6,570 $ 5,164 |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following (in thousands): March 31, December 31, Prepaid and financed insurance $ 1,513 $ — Prepaid expenses 1,409 1,029 Value added tax receivable 900 446 Contract assets — 197 Vendor prepaid 287 — Government tax receivables 1,419 1,416 Other assets 129 186 $ 5,657 $ 3,274 |
Schedule of Property and Equipment, Net | Property and equipment, net consists of the following (in thousands): March 31, December 31, Office equipment $ 157 $ 157 Computer hardware and software 2,081 2,017 Lab equipment 2,802 2,864 Furniture and fixtures 553 545 Leasehold improvements 1,087 1,069 Gross book value 6,680 6,652 Less: accumulated depreciation and amortization (4,318) (4,291) $ 2,362 $ 2,361 |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consists of the following (in thousands): March 31, December 31, Accrued compensation and employee benefits $ 2,189 $ 2,999 Accrued professional services 1,243 1,909 Financed insurance 912 — Accrued valued added and other taxes 508 399 Accruals for purchases received 607 751 Current operating lease liabilities 483 593 Accrued TAS legal settlement — 325 Other current liabilities 1,414 968 $ 7,356 $ 7,944 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets at Fair Value | The following table sets forth the Company’s financial assets and liabilities that were measured at fair value, on a recurring basis as of March 31, 2023 (in thousands): March 31, 2023 Level 1 Level 2 Level 3 Total Financial Assets Cash equivalents Money market funds $ 50,119 $ — $ — $ 50,119 Total assets $ 50,119 $ — $ — $ 50,119 Financial Liabilities Venture Linked Notes $ — $ — $ 42,874 $ 42,874 Public warrants 876 — — 876 Private warrants — 637 — 637 Total liabilities $ 876 $ 637 $ 42,874 $ 44,387 The following table sets forth the Company’s financial assets and liabilities that were measured at fair value, on a recurring basis as of December 31, 2022 (in thousands): December 31, 2022 Level 1 Level 2 Level 3 Total Financial Assets Cash equivalents Money market funds $ 11 $ — $ — $ 11 Marketable equity securities 2 — — 2 Total assets $ 13 $ — $ — $ 13 Financial Liabilities Pre-Close Notes $ — $ — $ 25,300 $ 25,300 Embedded derivative in convertible notes — — 60 60 Total liabilities $ — $ — $ 25,360 $ 25,360 |
Schedule of Financial Liabilities at Fair Value | The following table sets forth the Company’s financial assets and liabilities that were measured at fair value, on a recurring basis as of March 31, 2023 (in thousands): March 31, 2023 Level 1 Level 2 Level 3 Total Financial Assets Cash equivalents Money market funds $ 50,119 $ — $ — $ 50,119 Total assets $ 50,119 $ — $ — $ 50,119 Financial Liabilities Venture Linked Notes $ — $ — $ 42,874 $ 42,874 Public warrants 876 — — 876 Private warrants — 637 — 637 Total liabilities $ 876 $ 637 $ 42,874 $ 44,387 The following table sets forth the Company’s financial assets and liabilities that were measured at fair value, on a recurring basis as of December 31, 2022 (in thousands): December 31, 2022 Level 1 Level 2 Level 3 Total Financial Assets Cash equivalents Money market funds $ 11 $ — $ — $ 11 Marketable equity securities 2 — — 2 Total assets $ 13 $ — $ — $ 13 Financial Liabilities Pre-Close Notes $ — $ — $ 25,300 $ 25,300 Embedded derivative in convertible notes — — 60 60 Total liabilities $ — $ — $ 25,360 $ 25,360 |
Schedule of the Fair Value of Venture Linked Notes | The fair value of the Venture Linked Notes was determined using a binomial lattice model with the following key assumptions: March 31, 2023 February 10, 2023 Term 4.9 years 5.0 years Stock price $1.36 per share $8.58 per share Dividend yield — % — % Expected volatility 67.5 % 67.5 % Risk-free rate 3.7 % 3.9 % Risky rate 26.6 % 25.6 % Movement up 1.15 1.15 Movement down 0.87 0.87 Probability up 47.1 % 47.1 % Probability down 52.9 % 52.9 % |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Outstanding Borrowings | The following table summarizes the outstanding borrowings as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Venture Linked Notes $ 75,000 $ — Pre-Close Notes — 25,300 Convertible notes - related party — 6,345 ACOA Loans 461 497 Add: fair value of embedded derivative in convertible notes — 60 Less: unamortized debt discounts and issuance costs — (219) Less: fair value adjustment on Venture Linked Notes (32,126) — Total debt $ 43,335 $ 31,983 Classification: Line of credit and current portion of long-term debt $ 148 $ 148 Long-term portion of term debt 43,187 25,649 Convertible notes, net – related party — 6,186 |
Revenues (Tables)
Revenues (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue | The following table depicts the disaggregation of revenue according to revenue type (in thousands): Three Months Ended March 31, 2023 2022 Revenues Product $ 7,659 $ 8,100 Service 1,508 1,408 Total Revenues $ 9,167 $ 9,508 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock-based Compensation Expense by Line Item on the Statement of Operations | Stock-based compensation expense included in the accompanying condensed consolidated statements of operations for the three months ended March 31, 2023 and 2022 are as follows (in thousands): Three Months Ended March 31, 2023 2022 Research and development $ 219 $ 48 Sales and marketing 140 93 General and administrative 305 172 Total stock-based compensation $ 664 $ 313 |
Schedule of Stock Option Activity | The following table summarizes the Company’s stock option activity under all plans for the three months ended March 31, 2023: Stock Options Outstanding Weighted-Average Outstanding - December 31, 2022 5,691,018 $ 2.15 Granted — $ — Exercised (3,970) $ 2.59 Cancelled (12,423) $ 3.70 Expired — $ — Balance outstanding at March 31, 2023 5,674,625 $ 2.19 Exercisable at March 31, 2023 3,552,483 $ 1.89 |
Net Income (Loss) per Share (Ta
Net Income (Loss) per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings per Share | The following table sets forth the computation of the basic and diluted net income (loss) per share attributable to common stockholders for the three months ended March 31, 2023, and 2022 (in thousands except share and per share amounts): Three Months Ended 2023 2022 Numerator: Net income (loss) attributable to common stockholders, basic $ 15,520 $ (6,255) Add: Deemed dividends from accretion of Series D-1 Preferred Stock 316 — Add: Convertible notes interest expense and loss on debt extinguishment 219 — Net income (loss) attributable to common stockholders, diluted $ 16,055 $ (6,255) Denominator: Weighted-average common shares outstanding for basic EPS 30,440,497 4,529,543 Weighted average shares from preferred stock converted into common shares 12,566,203 — Weighted average dilutive outstanding options 1,080,655 — Weighted average shares from convertible notes converted into common shares 296,949 — Weighted average Legacy Movella warrants converted into common shares 178,181 — Diluted weighted-average common shares outstanding 44,562,485 4,529,543 Net income (loss) per share: Basic net income (loss) per share attributable to common stockholders $ 0.51 $ (1.38) Diluted net income (loss) per share attributable to common stockholders $ 0.36 $ (1.38) |
Schedule of Potentially Dilutive Securities Excluded from Computation of Earnings Per Share | Potentially dilutive securities that were not included in the diluted per share calculations as of March 31, 2023 and 2022 because they would be anti-dilutive were as follows: March 31, 2023 2022 Convertible preferred stock — 27,543,266 Outstanding stock options 1,682,520 7,493,066 Convertible notes(a) — 616,506 Legacy Movella Common stock warrants (1:1) — 291,502 Legacy Movella Preferred stock warrants (1:1) — 24,437 Public warrants (1:1) 6,499,961 — Private warrants (1:1) 4,250,000 — Total 12,432,481 35,968,777 (a) Assumes conversion at $9.80 per share. |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Schedule of Maturity of Operating Lease Liabilities | The aggregate future non-cancelable minimum rental payments for the Company’s operating leases, as of March 31, 2023, are as follows (in thousands): Year ended December 31, 2023 (remainder) $ 666 2024 737 2025 561 2026 561 2027 561 2028 561 Thereafter 1,312 Total minimum operating lease payments $ 4,959 Less: Amounts representing interest (1,852) Present value of net minimum operating lease payments 3,107 Less: Current portion (483) Long-term portion of operating lease obligations $ 2,624 |
Summary of Lease Cost | The components of the right-of-use assets and lease liabilities were as follows (in thousands): Balance Sheet Classification March 31, December 31, Right-of-use assets, net Right-of-use assets, net $ 3,107 $ 3,281 Current operating lease liabilities Accrued expenses and other current liabilities (483) (593) Non-current operating lease liabilities Operating lease liabilities and other non-current liabilities (2,624) (2,688) Total operating lease liabilities $ (3,107) $ (3,281) Weighted average remaining lease term (in years) 7.1 7.0 Weighted-average discount rate 14 % 14 % The components of lease cost were as follows (in thousands): Three Months Ended March 31, 2023 2022 Operating lease costs included in operating costs and expenses: Operating leases $ 361 $ 317 Supplemental cash flow information related to leases was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cash paid for amounts included in the measurement of operating lease liabilities: Operating cash flows related to operating leases $ 300 $ 366 Right-of-use assets obtained in exchange for lease liabilities: Operating leases $ — 4,280 |
Geographic Information and Co_2
Geographic Information and Concentrations of Risk (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Risks and Uncertainties [Abstract] | |
Schedule of Revenue by Geographic Region | The Company’s revenues by geographical region is as follows (in thousands): Three Months Ended March 31, 2023 2022 United States $ 2,004 $ 2,310 China 1,653 1,351 Asia, other 1,602 1,779 Europe 2,714 2,900 Other 1,194 1,168 $ 9,167 $ 9,508 |
Overview and Summary of Signi_2
Overview and Summary of Significant Accounting Policies - Merger with Pathfinder Acquisition Corporation (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Feb. 28, 2023 USD ($) | Feb. 10, 2023 USD ($) | Feb. 28, 2023 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Business Acquisition [Line Items] | |||||
Recapitalization exchange ratio | 0.4887 | ||||
Acquisition related costs | $ 29.2 | ||||
Recapitalization costs | $ 19.7 | $ 27.5 | |||
Venture Linked Notes | |||||
Business Acquisition [Line Items] | |||||
Acquisition costs expensed | $ 7.9 | $ 7.9 | $ 1.6 |
Overview and Summary of Signi_3
Overview and Summary of Significant Accounting Policies - Liquidity (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Feb. 10, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||||
Loss from operations | $ (9,402) | $ (5,507) | ||
Net cash used in operating activities | 5,440 | $ 4,745 | ||
Cash and cash equivalents | 62,096 | $ 14,334 | ||
Value of shares purchased | $ 111,000 | |||
New Movella Common Stock | ||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||||
Value of shares purchased | $ 58,000 | |||
Subsidiaries | China | ||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||||
Maximum cash and cash equivalents transfer amount | 200 | |||
Joint Venture Entity | China | ||||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||||
Maximum cash and cash equivalents transfer amount | $ 1,000 |
Overview and Summary of Signi_4
Overview and Summary of Significant Accounting Policies - Segment Reporting (Details) | 3 Months Ended |
Mar. 31, 2023 segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 1 |
Number of reportable segments | 1 |
Overview and Summary of Signi_5
Overview and Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||
Cash and cash equivalents | $ 62,096 | $ 14,334 |
Non-US | ||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||
Cash and cash equivalents | 3,500 | $ 4,100 |
Subsidiaries | China | ||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||
Maximum cash and cash equivalents transfer amount | 200 | |
Joint Venture Entity | China | ||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | ||
Maximum cash and cash equivalents transfer amount | $ 1,000 |
Overview and Summary of Signi_6
Overview and Summary of Significant Accounting Policies - Debt Instruments (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended |
Feb. 28, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
Pre-Close Notes | |||
Business Acquisition [Line Items] | |||
Acquisition costs expensed | $ 0.8 | ||
Venture Linked Notes | |||
Business Acquisition [Line Items] | |||
Acquisition costs expensed | $ 7.9 | $ 7.9 | $ 1.6 |
Overview and Summary of Signi_7
Overview and Summary of Significant Accounting Policies - Deferred Payout (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||
Mar. 23, 2022 USD ($) | Sep. 23, 2021 USD ($) | Mar. 23, 2021 USD ($) | Sep. 23, 2020 USD ($) payment | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 20, 2022 USD ($) | |
Business Acquisition [Line Items] | ||||||||
Cash installment, paid amount | $ 4,360 | $ 0 | ||||||
Deferred payout, remaining balance paid | $ 1,000 | |||||||
Litigation settlement, amount awarded to other party, quarterly installments | $ 500 | |||||||
Kinduct | ||||||||
Business Acquisition [Line Items] | ||||||||
Ownership percentage | 100% | |||||||
Number of deferred cash installment payments | payment | 3 | |||||||
Cash installment payments | $ 6,000 | $ 2,000 | $ 2,000 | $ 10,000 | ||||
Cash installment payments, fair value | $ 9,400 | |||||||
Cash installment, paid amount | $ 4,000 | |||||||
Cash installment payments, remaining amount | 6,000 | |||||||
Exchange of consideration under the deferred payout for convertible notes | $ 1,100 | |||||||
Deferred payouts, interest rate | 0.12 |
Overview and Summary of Signi_8
Overview and Summary of Significant Accounting Policies - Debt and Equity Issuance Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Feb. 28, 2023 | Feb. 10, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Debt issuance costs | $ 7,945 | $ 0 | ||
Recapitalization costs | $ 19,700 | $ 27,500 | ||
Venture Linked Notes | ||||
Business Acquisition [Line Items] | ||||
Debt issuance costs | $ 7,900 |
Overview and Summary of Signi_9
Overview and Summary of Significant Accounting Policies - Acquired Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Impairment of intangible assets | $ 4,657 | $ 0 |
Overview and Summary of Sign_10
Overview and Summary of Significant Accounting Policies - Warrant Liabilities (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | |||
Feb. 10, 2023 $ / shares shares | Mar. 31, 2023 USD ($) shares | Mar. 31, 2022 USD ($) | Dec. 31, 2022 shares | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Common stock, shares outstanding (in shares) | 50,693,308 | 6,231,947 | ||
Recapitalization exchange ratio | 0.4887 | |||
Gain on change in fair value of warrant liabilities | $ | $ 1,390 | $ 0 | ||
New Movella Common Stock | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Issuance of common stock upon conversion (in shares) | 266,880 | |||
Public and Private Warrant | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 11.50 | |||
Public and Private Warrant | New Movella Common Stock | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Common stock, shares outstanding (in shares) | 1 | |||
Public Warrants | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Warrants outstanding (in shares) | 6,500,000 | |||
Private Warrants | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Warrants outstanding (in shares) | 4,250,000 | |||
Legacy Movella Warrants | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Warrants outstanding (in shares) | 596,435 | |||
Legacy Movella Common Stock | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Warrants outstanding (in shares) | 546,056 |
Overview and Summary of Sign_11
Overview and Summary of Significant Accounting Policies - Preferred Stock Redemption and Classification (Details) - Series D-1 Convertible Preferred Stock | 3 Months Ended |
Mar. 31, 2023 $ / shares | |
Class of Stock [Line Items] | |
Share issued (in dollars per share) | $ 4.5713 |
Percentage of original issue price | 0.08 |
Maximum days after receipt of a written notice | 60 days |
Balance Sheet Components - Inve
Balance Sheet Components - Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 2,986 | $ 2,758 |
Work-in-progress | 1,231 | 1,132 |
Finished goods | 2,353 | 1,274 |
Inventory, net | $ 6,570 | $ 5,164 |
Balance Sheet Components - Prep
Balance Sheet Components - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Prepaid and financed insurance | $ 1,513 | $ 0 |
Prepaid expenses | 1,409 | 1,029 |
Value added tax receivable | 900 | 446 |
Contract assets | 0 | 197 |
Vendor prepaid | 287 | 0 |
Government tax receivables | 1,419 | 1,416 |
Other assets | 129 | 186 |
Prepaid expenses and other current assets | $ 5,657 | $ 3,274 |
Balance Sheet Components - Prop
Balance Sheet Components - Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | |||
Gross book value | $ 6,680 | $ 6,652 | |
Less: accumulated depreciation and amortization | (4,318) | (4,291) | |
Property and equipment, net | 2,362 | 2,361 | |
Depreciation and amortization, expense | 200 | $ 200 | |
Office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Gross book value | 157 | 157 | |
Computer hardware and software | |||
Property, Plant and Equipment [Line Items] | |||
Gross book value | 2,081 | 2,017 | |
Lab equipment | |||
Property, Plant and Equipment [Line Items] | |||
Gross book value | 2,802 | 2,864 | |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Gross book value | 553 | 545 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Gross book value | $ 1,087 | $ 1,069 |
Balance Sheet Components - Accr
Balance Sheet Components - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued compensation and employee benefits | $ 2,189 | $ 2,999 |
Accrued professional services | 1,243 | 1,909 |
Financed insurance | 912 | 0 |
Accrued valued added and other taxes | 508 | 399 |
Accruals for purchases received | 607 | 751 |
Current operating lease liabilities | 483 | 593 |
Accrued TAS legal settlement | 0 | 325 |
Other current liabilities | 1,414 | 968 |
Accrued expenses and other current liabilities | $ 7,356 | $ 7,944 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2023 | Mar. 31, 2022 | Feb. 10, 2023 | Dec. 31, 2022 | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Warrants | $ 1,513 | $ 0 | ||
Gain on change in fair value of warrant liabilities | 1,390 | $ 0 | ||
Gain on revaluation of debt, net | 31,868 | 0 | ||
Notes Payable, Other Payables | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Principal amount | 75,000 | |||
Fair Value, Recurring | Venture Linked and Pre-Close Notes | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Gain on revaluation of debt, net | 31,900 | $ 0 | ||
Fair Value, Recurring | Public Warrants | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Warrants | 876 | $ 1,800 | ||
Gain on change in fair value of warrant liabilities | 900 | |||
Fair Value, Recurring | Private Warrants | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Warrants | 637 | $ 1,100 | ||
Gain on change in fair value of warrant liabilities | $ 500 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets and Liabilities at Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Feb. 10, 2023 | Dec. 31, 2022 |
Financial Liabilities | |||
Warrants | $ 1,513 | $ 0 | |
Embedded derivative in convertible notes | 0 | 60 | |
Fair Value, Recurring | |||
Financial Assets | |||
Marketable equity securities | 2 | ||
Total assets | 50,119 | 13 | |
Financial Liabilities | |||
Embedded derivative in convertible notes | 60 | ||
Total liabilities | 44,387 | 25,360 | |
Fair Value, Recurring | Public Warrants | |||
Financial Liabilities | |||
Warrants | 876 | $ 1,800 | |
Fair Value, Recurring | Private Warrants | |||
Financial Liabilities | |||
Warrants | 637 | $ 1,100 | |
Fair Value, Recurring | Venture Linked Notes | |||
Financial Liabilities | |||
Notes | 42,874 | 0 | |
Fair Value, Recurring | Pre-Close Notes | |||
Financial Liabilities | |||
Notes | 25,300 | ||
Fair Value, Recurring | Money market funds | |||
Financial Assets | |||
Money market funds | 50,119 | 11 | |
Fair Value, Recurring | Level 1 | |||
Financial Assets | |||
Marketable equity securities | 2 | ||
Total assets | 50,119 | 13 | |
Financial Liabilities | |||
Embedded derivative in convertible notes | 0 | ||
Total liabilities | 876 | 0 | |
Fair Value, Recurring | Level 1 | Public Warrants | |||
Financial Liabilities | |||
Warrants | 876 | ||
Fair Value, Recurring | Level 1 | Private Warrants | |||
Financial Liabilities | |||
Warrants | 0 | ||
Fair Value, Recurring | Level 1 | Venture Linked Notes | |||
Financial Liabilities | |||
Notes | 0 | ||
Fair Value, Recurring | Level 1 | Pre-Close Notes | |||
Financial Liabilities | |||
Notes | 0 | ||
Fair Value, Recurring | Level 1 | Money market funds | |||
Financial Assets | |||
Money market funds | 50,119 | 11 | |
Fair Value, Recurring | Level 2 | |||
Financial Assets | |||
Marketable equity securities | 0 | ||
Total assets | 0 | 0 | |
Financial Liabilities | |||
Embedded derivative in convertible notes | 0 | ||
Total liabilities | 637 | 0 | |
Fair Value, Recurring | Level 2 | Public Warrants | |||
Financial Liabilities | |||
Warrants | 0 | ||
Fair Value, Recurring | Level 2 | Private Warrants | |||
Financial Liabilities | |||
Warrants | 637 | ||
Fair Value, Recurring | Level 2 | Venture Linked Notes | |||
Financial Liabilities | |||
Notes | 0 | ||
Fair Value, Recurring | Level 2 | Pre-Close Notes | |||
Financial Liabilities | |||
Notes | 0 | ||
Fair Value, Recurring | Level 2 | Money market funds | |||
Financial Assets | |||
Money market funds | 0 | 0 | |
Fair Value, Recurring | Level 3 | |||
Financial Assets | |||
Marketable equity securities | 0 | ||
Total assets | 0 | 0 | |
Financial Liabilities | |||
Embedded derivative in convertible notes | 60 | ||
Total liabilities | 42,874 | 25,360 | |
Fair Value, Recurring | Level 3 | Public Warrants | |||
Financial Liabilities | |||
Warrants | 0 | ||
Fair Value, Recurring | Level 3 | Private Warrants | |||
Financial Liabilities | |||
Warrants | 0 | ||
Fair Value, Recurring | Level 3 | Venture Linked Notes | |||
Financial Liabilities | |||
Notes | 42,874 | ||
Fair Value, Recurring | Level 3 | Pre-Close Notes | |||
Financial Liabilities | |||
Notes | 25,300 | ||
Fair Value, Recurring | Level 3 | Money market funds | |||
Financial Assets | |||
Money market funds | $ 0 | $ 0 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of the Fair Value of Venture Linked Notes (Details) - Venture Linked Notes | Mar. 31, 2023 $ / shares movement yr | Feb. 10, 2023 yr movement $ / shares |
Term | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | yr | 4.9 | 5 |
Stock price | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | $ / shares | 1.36 | 8.58 |
Dividend yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 0 | 0 |
Expected volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 0.675 | 0.675 |
Risk-free rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 0.037 | 0.039 |
Risky rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 0.266 | 0.256 |
Movement up | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 1.15 | 1.15 |
Movement down | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 0.87 | 0.87 |
Probability up | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 0.471 | 0.471 |
Probability down | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement inputs | 0.529 | 0.529 |
Reverse Recapitalization - Narr
Reverse Recapitalization - Narrative (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | ||||||
Feb. 28, 2023 USD ($) | Feb. 10, 2023 USD ($) $ / shares shares | Jan. 04, 2023 shares | Nov. 14, 2022 shares | Mar. 31, 2023 USD ($) shares | Mar. 31, 2022 USD ($) | Dec. 31, 2022 shares | |
Business Acquisition [Line Items] | |||||||
Recapitalization exchange ratio | 0.4887 | ||||||
Value of shares purchased | $ | $ 111,000 | ||||||
Recapitalization costs | $ | $ 19,700 | $ 27,500 | |||||
Repayment of loans using proceeds from Venture Linked Notes | $ | $ 25,557 | $ 0 | |||||
Common stock, shares outstanding (in shares) | 50,693,308 | 6,231,947 | |||||
Common stock, shares issued (in shares) | 50,693,308 | 6,231,947 | |||||
Legacy Movella Options | |||||||
Business Acquisition [Line Items] | |||||||
Options, granted and outstanding (in shares) | 11,637,195 | ||||||
New Movella Options | |||||||
Business Acquisition [Line Items] | |||||||
Options converted, reverse recapitalization (in shares) | 5,687,048 | ||||||
Pathfinder Trust | |||||||
Business Acquisition [Line Items] | |||||||
Value of shares purchased | $ | $ 36,000 | ||||||
Venture Linked Notes | |||||||
Business Acquisition [Line Items] | |||||||
Value of shares purchased | $ | 75,000 | ||||||
Repayment of loans using proceeds from Venture Linked Notes | $ | 25,600 | ||||||
Pre-Close Notes | |||||||
Business Acquisition [Line Items] | |||||||
Repayment of loans using proceeds from Venture Linked Notes | $ | $ 25,600 | ||||||
Legacy Movella Warrants | |||||||
Business Acquisition [Line Items] | |||||||
Warrants outstanding, exercised (in shares) | 596,435 | ||||||
Warrants outstanding (in shares) | 596,435 | ||||||
Warrants exercised (in shares) | 546,056 | ||||||
Legacy Movella Warrants | Other Related Parties | |||||||
Business Acquisition [Line Items] | |||||||
Issuance of common stock upon conversion (in shares) | 266,880 | ||||||
Public Warrants | |||||||
Business Acquisition [Line Items] | |||||||
Warrants outstanding (in shares) | 6,500,000 | ||||||
Legacy Movella Redeemable Convertible Preferred Stock | |||||||
Business Acquisition [Line Items] | |||||||
Common stock, shares outstanding (in shares) | 56,361,224 | ||||||
Legacy Movella Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Issuance of common stock in connection with business combination, net (in shares) | 56,438,820 | ||||||
Stock converted from notes, reverse recapitalization (in shares) | 1,333,712 | ||||||
Stock, issued and outstanding (in shares) | 71,077,736 | ||||||
Common stock, shares outstanding (in shares) | 12,759,148 | ||||||
Legacy Movella Common Stock | Other Related Parties | |||||||
Business Acquisition [Line Items] | |||||||
Stock converted, reverse recapitalization (in shares) | 6,235,917 | ||||||
Stock converted from redeemable convertible preferred stock, reverse recapitalization (in shares) | 27,583,963 | ||||||
New Movella Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Value of shares purchased | $ | $ 58,000 | ||||||
Issuance of common stock upon conversion (in shares) | 266,880 | ||||||
Stock acquired, reverse recapitalization (in shares) | 1 | ||||||
Price per share (in dollars per share) | $ / shares | $ 11.50 | ||||||
New Movella Common Stock | Other Related Parties | |||||||
Business Acquisition [Line Items] | |||||||
Stock converted, reverse recapitalization (in shares) | 34,738,600 | ||||||
FP Purchasers | New Movella Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Stock converted, reverse recapitalization (in shares) | 7,500,000 | ||||||
Common stock, shares issued (in shares) | 1,000,000 | ||||||
FP Purchasers | New Movella Common Stock | Equity Grant Agreement | |||||||
Business Acquisition [Line Items] | |||||||
Number of units issued by the company (in shares) | 1,000,000 | ||||||
FP Purchasers | New Movella Common Stock | Note Purchase Agreement | |||||||
Business Acquisition [Line Items] | |||||||
Number of units issued by the company (in shares) | 7,500,000 | 7,500,000 | |||||
FP Purchasers | Class A Ordinary Shares | |||||||
Business Acquisition [Line Items] | |||||||
Number of units issued by the company (in shares) | 0 | ||||||
FP Purchasers | FP Shares | |||||||
Business Acquisition [Line Items] | |||||||
Common stock, shares outstanding (in shares) | 7,500,000 | ||||||
Pathfinder | Private Placement Warrants | |||||||
Business Acquisition [Line Items] | |||||||
Warrants outstanding (in shares) | 4,250,000 | ||||||
Pathfinder | New Movella Warrants | |||||||
Business Acquisition [Line Items] | |||||||
Private warrants converted, reverse recapitalization (in shares) | 4,250,000 | ||||||
Public warrants converted, reverse recapitalization (in shares) | 6,500,000 | ||||||
Pathfinder | Public Warrants | |||||||
Business Acquisition [Line Items] | |||||||
Warrants outstanding (in shares) | 6,500,000 | ||||||
Pathfinder | New Movella Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Stock converted, reverse recapitalization (in shares) | 3,354,708 | ||||||
Remaining stock converted, reverse recapitalization (in shares) | 4,100,000 | ||||||
Pathfinder | Class A Ordinary Shares | |||||||
Business Acquisition [Line Items] | |||||||
Common stock, shares outstanding (in shares) | 3,354,708 | ||||||
Stock redeemed, reverse recapitalization (in shares) | 29,145,292 | ||||||
Pathfinder | Class B Ordinary Shares | |||||||
Business Acquisition [Line Items] | |||||||
Shares forfeited, reverse recapitalization, percent | 0.50 | ||||||
Shares forfeited, reverse recapitalization (in shares) | 4,025,000 | ||||||
Stock, issued and outstanding, remaining shares (in shares) | 4,100,000 |
Debt - Summary of Outstanding B
Debt - Summary of Outstanding Borrowings (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Add: fair value of embedded derivative in convertible notes | $ 0 | $ 60 |
Less: unamortized debt discounts and issuance costs | 0 | (219) |
Less: fair value adjustment on Venture Linked Notes | (32,126) | 0 |
Total debt | 43,335 | 31,983 |
Line of credit and current portion of long-term debt | 148 | 148 |
Long-term portion of term debt | 43,187 | 25,649 |
Related Party | ||
Debt Instrument [Line Items] | ||
Convertible notes, net – related party | 0 | 6,186 |
Venture Linked Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 75,000 | 0 |
Pre-Close Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 0 | 25,300 |
Convertible notes - related party | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 0 | 6,345 |
ACOA Loans | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 461 | $ 497 |
Debt - Pre-Merger Senior Secure
Debt - Pre-Merger Senior Secured Notes and Venture Linked Notes (Details) - Note Purchase Agreement - USD ($) $ in Millions | Feb. 10, 2023 | Nov. 14, 2022 |
Senior Secured Notes and Senior Secured Venture Linked Notes | ||
Debt Instrument [Line Items] | ||
Interest rate | 9.25% | |
Long-term debt, term | 5 years | |
Senior Secured Notes | ||
Debt Instrument [Line Items] | ||
Principal amount | $ 25 | |
Senior Secured Venture Linked Notes | ||
Debt Instrument [Line Items] | ||
Principal amount | $ 75 |
Debt - Silicon Valley Bank (Det
Debt - Silicon Valley Bank (Details) - Term Loan - Loan and Security Agreement, SVB $ / shares in Units, $ in Millions | 1 Months Ended | |
Oct. 31, 2022 | Feb. 28, 2022 USD ($) $ / shares shares | |
Debt Instrument [Line Items] | ||
Cash proceeds | $ | $ 1 | |
Common stock purchased with warrants issued (in shares) | shares | 16,321 | |
Exercise price of warrants (in dollars per share) | $ / shares | $ 1.58 | |
Term loan, repayable period | 30 months | |
Basis spread on prime rate | 1.75% | |
Fixed interest rate, payable monthly | 0.050 |
Debt - Eastward Fund Management
Debt - Eastward Fund Management, LLC (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Dec. 10, 2021 USD ($) day $ / shares shares | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | |||
Repayment of loans using proceeds from Venture Linked Notes | $ 25,557 | $ 0 | |
Term Loan | Loan and Security Agreement, Eastward | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 8,000 | ||
Repayment of loans using proceeds from Venture Linked Notes | $ 4,400 | ||
Repayment term, monthly interest-only payments | 18 months | ||
Repayment term, monthly principal and interest payments | 30 months | ||
Balloon payment, percentage | 0.025 | ||
Balloon payment, amount | $ 200 | ||
Number of days of notice for prepayment of the loan | day | 45 | ||
Common stock purchased with warrants issued (in shares) | shares | 215,054 | ||
Exercise price of warrants (in dollars per share) | $ / shares | $ 0.93 | ||
Term Loan | Loan and Security Agreement, Eastward | Prime Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on prime rate | 8.25% | ||
Prime floor percentage | 0.0325 |
Debt - ACOA Loan (Details)
Debt - ACOA Loan (Details) - Term Loan - ACOA Loan - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Mar. 31, 2023 | |
Debt Instrument [Line Items] | ||
Monthly repayment amount | $ 200 | |
Total debt | $ 500,000 | $ 500,000 |
Debt - Convertible notes - rela
Debt - Convertible notes - related party (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Mar. 31, 2022 USD ($) $ / shares | Mar. 31, 2023 USD ($) $ / shares | Mar. 31, 2022 USD ($) $ / shares | Feb. 10, 2023 | |
Debt Instrument [Line Items] | ||||
Proceeds from issuance of convertible notes | $ 0 | $ 4,873 | ||
Conversion price (in dollars per share) | $ / shares | $ 9.80 | $ 9.80 | $ 9.80 | |
Recapitalization exchange ratio | 0.4887 | |||
Interest expense | $ 172 | $ 400 | ||
Convertible Notes | ||||
Debt Instrument [Line Items] | ||||
Convertible notes | $ 1,100 | 1,100 | ||
Interest expense | 100 | |||
Convertible Notes | Preferred Stock Investors | ||||
Debt Instrument [Line Items] | ||||
Proceeds from issuance of convertible notes | 4,900 | |||
Convertible Notes | Kinduct | ||||
Debt Instrument [Line Items] | ||||
Convertible notes | 1,000 | 1,000 | ||
Deferred payout liability, payment | $ 1,100 | $ 1,100 | ||
Convertible Notes | Other Related Parties | ||||
Debt Instrument [Line Items] | ||||
Related party transactions, interest rate | 6% | |||
Interest expense | $ 100 | |||
Percentage of debt converted into equity | 1 |
Debt - Revolving Lines of Credi
Debt - Revolving Lines of Credit - SVB (Details) - Revolving Credit Facility - Line of Credit - USD ($) $ in Millions | 1 Months Ended | |
Feb. 28, 2022 | Jun. 09, 2020 | |
Amended SVB Loan Agreements | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 3 | |
Basis spread on prime rate | 1% | |
Interest rate, fixed | 4.25% | |
Percentage available for borrowings on eligible accounts receivable | 0.65 | |
Maximum amount eligible to be borrowed against accounts receivable | $ 1.5 | |
Percentage available for borrowings on eligible foreign accounts receivable | 0.25 | |
Maximum amount eligible to be borrowed against foreign accounts receivable | $ 0.8 | |
TD Ameritrade | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 1.5 |
Debt - TD BCRS Revolving Line o
Debt - TD BCRS Revolving Line of Credit (Details) - Revolving Credit Facility - TD Ameritrade - Line of Credit $ in Millions | Jun. 09, 2020 USD ($) multiplication_factor |
Line of Credit Facility [Line Items] | |
Maximum borrowing capacity | $ | $ 1.5 |
Multiplication factor for calculating the borrowing base | multiplication_factor | 5 |
Prime Rate | |
Line of Credit Facility [Line Items] | |
Basis spread on prime rate | 1.55% |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue from External Customer [Line Items] | ||
Total revenues | $ 9,167 | $ 9,508 |
Revenue recognized form prior year deferred revenue | 1,000 | 900 |
Product | ||
Revenue from External Customer [Line Items] | ||
Total revenues | 7,659 | 8,100 |
Service | ||
Revenue from External Customer [Line Items] | ||
Total revenues | $ 1,508 | $ 1,408 |
Stock-based Compensation - Sche
Stock-based Compensation - Schedule of Stock-based Compensation Expense by Line Item on the Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | $ 664 | $ 313 |
Research and development | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | 219 | 48 |
Sales and marketing | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | 140 | 93 |
General and administrative | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation | $ 305 | $ 172 |
Stock-based Compensation - Narr
Stock-based Compensation - Narrative (Details) - USD ($) | 3 Months Ended | ||||||
Oct. 31, 2022 | Dec. 31, 2017 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Jan. 31, 2022 | Sep. 30, 2019 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Per share exercise price as a percentage of fair value, minimum | 110% | ||||||
Common stock, shares outstanding (in shares) | 50,693,308 | 6,231,947 | |||||
Cost not yet recognized | $ 2,800,000 | ||||||
Compensation cost not yet recognized, weighted-average period | 2 years 3 months 21 days | ||||||
Shares issued under the ESPP (in shares) | 0 | 0 | |||||
Total stock-based compensation | $ 664,000 | $ 313,000 | |||||
Employee Stock | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Maximum shares allowed to be purchased under ESPP (in shares) | 1,017,550 | ||||||
Percentage of outstanding shares of common stock | 0.01 | ||||||
Common stock, potential additional shares authorized | 508,775 | ||||||
Total stock-based compensation | $ 0 | $ 0 | |||||
Employee's requisite service period | 5 years | ||||||
2009 Equity Incentive Plan | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Award term period | ten-year | ||||||
Award vesting period | 5 years | ||||||
2009 Equity Incentive Plan | Restricted Stock Units (RSUs) | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Restricted stock units, issued (in shares) | 1,348,887 | ||||||
Restricted stock units, vested (in shares) | 1,348,887 | ||||||
2019 Equity Incentive Plan | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Common stock reserved for future issuance (in shares) | 5,500,000 | ||||||
Increase (decrease) in the number of common stock reserved for future issuance (in shares) | 1,500,000 | ||||||
2022 Equity Incentive Plan | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Annual share increase, term | 10 years | ||||||
Annual share increase, percentage of outstanding shares | 5% | ||||||
Shares available for future grant (in shares) | 7,057,631 | ||||||
2022 Equity Incentive Plan | New Movella Common Stock | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Common stock, shares outstanding (in shares) | 6,105,301 |
Stock-based Compensation - Sc_2
Stock-based Compensation - Schedule of Stock Option Activity (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | |
Beginning balance, outstanding (in shares) | shares | 5,691,018 |
Granted (in shares) | shares | 0 |
Exercised (in shares) | shares | (3,970) |
Cancelled (in shares) | shares | (12,423) |
Expired (in shares) | shares | 0 |
Ending balance, outstanding (in shares) | shares | 5,674,625 |
Ending balance, exercisable (in shares) | shares | 3,552,483 |
Weighted-Average Exercise Price | |
Beginning balance, outstanding (in dollars per share) | $ / shares | $ 2.15 |
Ending balance, outstanding (in dollars per share) | $ / shares | 2.19 |
Granted (in dollars per share) | $ / shares | 0 |
Exercised (in dollars per share) | $ / shares | 2.59 |
Cancelled (in dollars per share) | $ / shares | 3.70 |
Expired (in dollars per share) | $ / shares | 0 |
Ending balance, exercisable (in dollars per share) | $ / shares | $ 1.89 |
Net Income (Loss) per Share - S
Net Income (Loss) per Share - Schedule of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator: | ||
Net income (loss) | $ 15,520 | $ (6,255) |
Add: Deemed dividends from accretion of Series D-1 Preferred Stock | 316 | 0 |
Add: Convertible notes interest expense and loss on debt extinguishment | 219 | 0 |
Net loss attributable to common stockholders, diluted | $ 16,055 | $ (6,255) |
Denominator: | ||
Weighted-average common shares outstanding for basic EPS (in shares) | 30,440,497 | 4,529,543 |
Weighted average shares from preferred stock converted into common shares (in shares) | 12,566,203 | 0 |
Weighted average dilutive outstanding options (in shares) | 1,080,655 | 0 |
Weighted average shares from convertible notes converted into common shares (in shares) | 296,949 | 0 |
Weighted average Legacy Movella warrants converted into common shares (in shares) | 178,181 | 0 |
Weighted average shares outstanding, diluted (in shares) | 44,562,485 | 4,529,543 |
Basic net income (loss) per share attributable to common stockholders (in dollars per share) | $ 0.51 | $ (1.38) |
Diluted net income (loss) per share attributable to common stockholders (in dollars per share) | $ 0.36 | $ (1.38) |
Net Income (Loss) per Share -_2
Net Income (Loss) per Share - Schedule of Potentially Dilutive Securities Excluded from Computation of Earnings Per Share (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 12,432,481 | 35,968,777 |
Conversion price (in dollars per share) | $ 9.80 | $ 9.80 |
Convertible preferred stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 0 | 27,543,266 |
Outstanding stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 1,682,520 | 7,493,066 |
Convertible notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 0 | 616,506 |
Common stock warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 0 | 291,502 |
Preferred stock warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 0 | 24,437 |
Public Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 6,499,961 | 0 |
Private Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 4,250,000 | 0 |
Leases - Schedule of Maturity o
Leases - Schedule of Maturity of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Maturity of Lease Liabilities | ||
2023 (remainder) | $ 666 | |
2024 | 737 | |
2025 | 561 | |
2026 | 561 | |
2027 | 561 | |
2028 | 561 | |
Thereafter | 1,312 | |
Total minimum operating lease payments | 4,959 | |
Less: Amounts representing interest | (1,852) | |
Present value of net minimum operating lease payments | 3,107 | $ 3,281 |
Less: Current portion | (483) | (593) |
Long-term portion of operating lease obligations | $ 2,624 | $ 2,688 |
Leases - Summary of Right-of-Us
Leases - Summary of Right-of-Use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Right-of-use assets, net | $ 3,107 | $ 3,281 |
Current operating lease liabilities | (483) | (593) |
Non-current operating lease liabilities | (2,624) | (2,688) |
Present value of net minimum operating lease payments | $ 3,107 | $ 3,281 |
Weighted average remaining lease term (in years) | 7 years 1 month 6 days | 7 years |
Weighted-average discount rate | 14% | 14% |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities |
Leases - Summary of Lease Cost
Leases - Summary of Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating lease costs included in operating costs and expenses: | ||
Operating leases | $ 361 | $ 317 |
Cash paid for amounts included in the measurement of operating lease liabilities: | ||
Operating cash flows related to operating leases | 300 | 366 |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 0 | $ 4,280 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | ||
Income tax expense | $ 58 | $ 15 |
Effective tax rate, less than | 1% | 1% |
Research costs | $ 2,904 | $ 3,536 |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | 25,800 | |
State | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 26,500 |
Geographic Information and Co_3
Geographic Information and Concentrations of Risk - Narrative (Details) - Number of Suppliers - Supplier Concentration Risk - Single Supplier - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Concentration Risk [Line Items] | ||
Concentration risk | 31% | 31% |
Inventory purchases | $ 1.9 | $ 1.1 |
Geographic Information and Co_4
Geographic Information and Concentrations of Risk - Schedule of Revenue by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 9,167 | $ 9,508 |
Revenue Benchmark | Geographic Concentration Risk | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 9,167 | 9,508 |
Revenue Benchmark | Geographic Concentration Risk | United States | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 2,004 | 2,310 |
Revenue Benchmark | Geographic Concentration Risk | China | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 1,653 | 1,351 |
Revenue Benchmark | Geographic Concentration Risk | Asia, other | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 1,602 | 1,779 |
Revenue Benchmark | Geographic Concentration Risk | Europe | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | 2,714 | 2,900 |
Revenue Benchmark | Geographic Concentration Risk | Other | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | $ 1,194 | $ 1,168 |
Related Party Transactions (Det
Related Party Transactions (Details) $ / shares in Units, $ in Millions | 1 Months Ended | |
Feb. 10, 2023 $ / shares shares | Mar. 31, 2022 USD ($) | |
Related Party Transaction [Line Items] | ||
Recapitalization exchange ratio | 0.4887 | |
Preferred Stock Investors | Investor | ||
Related Party Transaction [Line Items] | ||
Proceeds from note payable to related party | $ 4.9 | |
Convertible Promissory Notes to Sellers of Kinduct | Related Party | ||
Related Party Transaction [Line Items] | ||
Amounts of transaction | 1.1 | |
Conversion price (in dollars per share) | $ / shares | $ 9.80 | |
Percentage of debt converted into equity | 1 | |
Issuance of common stock upon conversion (in shares) | shares | 651,840 | |
Deferred Payout Liability | Related Party | ||
Related Party Transaction [Line Items] | ||
Amounts of transaction | 1.1 | |
Amount Issued | Related Party | ||
Related Party Transaction [Line Items] | ||
Amounts of transaction | $ 1 | |
Convertible Promissory Note Rate | Related Party | ||
Related Party Transaction [Line Items] | ||
Related party transactions, interest rate | 6% |
Commitment and Contingencies (D
Commitment and Contingencies (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Dec. 20, 2022 | Feb. 28, 2020 | |
Loss Contingencies [Line Items] | |||
Deferred payout, remaining balance paid | $ 1,000 | ||
Litigation settlement, amount awarded to other party, quarterly installments | $ 500 | ||
Tactical Air Support (TAS) | Pending Litigation | Alleged Tort and Contract Based Cause | |||
Loss Contingencies [Line Items] | |||
Loss contingency, estimate of possible loss | $ 40 | ||
Tactical Air Support (TAS) | Settled Litigation | Alleged Tort and Contract Based Cause | |||
Loss Contingencies [Line Items] | |||
Litigation settlement, amount awarded to other party | $ 300 | ||
Kinduct | Settled Litigation | |||
Loss Contingencies [Line Items] | |||
Loss contingency, annual interest rate | 12% | ||
Kinduct | Settled Litigation | Failure To Make Payments | |||
Loss Contingencies [Line Items] | |||
Loss contingency, amount payable | $ 5,200 |