10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2023

OR

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

For the transition period from ______ to ______

Commission File Number: 000-29440

IDENTIV, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	77-0444317
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2201 Walnut Avenue, Suite 100 Fremont, California	94538
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (949) 250-8888

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

Title of each class	Trading Symbol(s)	Name of exchange on which registered
Common Stock, $0.001 par value per share	INVE	The Nasdaq Stock Market LLC

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

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

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

Large accelerated filer	☐	Accelerated filer	☑
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

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

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

As of May 2, 2023, the registrant had 22,974,287 shares of common stock outstanding.

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Comprehensive Loss	4
	Condensed Consolidated Statements of Stockholders’ Equity	5
	Condensed Consolidated Statements of Cash Flows	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	31
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 6.	Exhibits	34
SIGNATURES		35

2

PART I: FINANCIAL INFORMATION

Item 1. Financial Statements

IDENTIV, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except par value)

	March 31, 2023			December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	20,804		$	16,650
Restricted cash		363			487
Accounts receivable, net of allowances of $2,675 and $2,666 as of March 31, 2023    and December 31, 2022, respectively		21,136			24,826
Inventories		30,609			28,958
Prepaid expenses and other current assets		4,361			4,177
Total current assets		77,273			75,098
Property and equipment, net		7,595			6,719
Operating lease right-of-use assets		4,344			4,373
Intangible assets, net		4,999			5,265
Goodwill		10,192			10,190
Other assets		1,148			1,120
Total assets	$	105,551		$	102,765
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	9,926		$	14,760
Financial liabilities, net of debt issuance costs of $59    as of March 31, 2023		9,941			—
Operating lease liabilities		1,199			1,190
Deferred revenue		1,798			2,068
Accrued compensation and related benefits		2,395			2,757
Other accrued expenses and liabilities		2,648			2,618
Total current liabilities		27,907			23,393
Long-term operating lease liabilities		3,371			3,366
Long-term deferred revenue		647			587
Other long-term liabilities		25			25
Total liabilities		31,950			27,371
Commitments and contingencies (see Note 15)
Stockholders' equity:
Preferred stock, $0.001 par value: 10,000 shares authorized; 5,000 shares    issued and outstanding as of March 31, 2023 and December 31, 2022		5			5
Common stock, $0.001 par value: 50,000 shares authorized; 24,246 and 24,168 shares    issued and 22,677 and 22,623 shares outstanding as of March 31, 2023 and    December 31, 2022, respectively		24			24
Additional paid-in capital		496,808			495,818
Treasury stock, 1,569 and 1,545 shares as of March 31, 2023 and December 31, 2022,    respectively		(12,357	)		(12,173	)
Accumulated deficit		(412,100	)		(409,381	)
Accumulated other comprehensive income		1,221			1,101
Total stockholders' equity		73,601			75,394
Total liabilities and stockholders' equity	$	105,551		$	102,765

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

3

IDENTIV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited, in thousands, except per share data)

	Three Months Ended March 31,
	2023			2022
Net revenue	$	25,997		$	25,061
Cost of revenue		16,786			16,095
Gross profit		9,211			8,966
Operating expenses:
Research and development		2,707			2,529
Selling and marketing		6,097			5,110
General and administrative		2,948			2,488
Restructuring and severance		191			(140	)
Total operating expenses		11,943			9,987
Loss from operations		(2,732	)		(1,021	)
Non-operating income (expense):
Interest expense, net		(50	)		(25	)
Gain on investment		—			24
Foreign currency gains, net		89			19
Loss before income tax benefit (provision)		(2,693	)		(1,003	)
Income tax benefit (provision)		(26	)		4
Net loss		(2,719	)		(999	)
Other comprehensive loss:
Foreign currency translation adjustment		120			(175	)
Comprehensive loss	$	(2,599	)	$	(1,174	)
Net loss per common share:
Basic	$	(0.13	)	$	(0.06	)
Diluted	$	(0.13	)	$	(0.06	)
Weighted average shares used in computing net    loss per common share:
Basic		22,794			22,574
Diluted		22,794			22,574

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

4

IDENTIV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited, in thousands)

	Three Months Ended March 31, 2023
	Series B Convertible Preferred Stock				Common Stock					Additional Paid-in		Treasury			Accumulated			Accumulated Other Comprehensive		Total Stockholders'
	Shares		Amount		Shares			Amount		Capital		Stock			Deficit			Income		Equity
Balances, January 1, 2023		5,000	$	5		22,623		$	24	$	495,818	$	(12,173	)	$	(409,381	)	$	1,101		75,394
Net loss		—		—		—			—		—		—			(2,719	)		—		(2,719	)
Unrealized income from foreign    currency translation adjustments		—		—		—			—		—		—			—			120		120
Issuance of common stock in connection    with vesting of stock awards		—		—		78			—		—		—			—			—		—
Stock-based compensation		—		—		—			—		990		—			—			—		990
Shares withheld in payment of taxes in    connection with net share settlement of    restricted stock units		—		—		(24	)		—		—		(184	)		—			—		(184	)
Balances, March 31, 2023		5,000	$	5		22,677		$	24	$	496,808	$	(12,357	)	$	(412,100	)	$	1,221	$	73,601

	Three Months Ended March 31, 2022
	Series B Convertible Preferred Stock				Common Stock					Additional Paid-in		Treasury			Accumulated			Accumulated Other Comprehensive			Total Stockholders'
	Shares		Amount		Shares			Amount		Capital		Stock			Deficit			Income			Equity
Balances, January 1, 2022		5,000	$	5		22,230		$	24	$	492,657	$	(11,134	)	$	(408,989	)	$	1,949			74,512
Net loss		—		—		—			—		—		—			(999	)		—			(999	)
Unrealized loss from foreign    currency translation adjustments		—		—		—			—		—		—			—			(175	)		(175	)
Issuance of common stock in connection    with vesting of stock awards		—		—		88			—		—		—			—			—			—
Stock-based compensation		—		—		—			—		895		—			—			—			895
Shares withheld in payment of taxes in    connection with net share settlement of    restricted stock units		—		—		(18	)		—		—		(399	)		—			—			(399	)
Balances, March 31, 2022		5,000	$	5		22,300		$	24	$	493,552	$	(11,533	)	$	(409,988	)	$	1,774		$	73,834

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

5

IDENTIV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, in thousands)

	Three Months Ended March 31,
	2023			2022
Cash flows used in operating activities
Net loss	$	(2,719	)	$	(999	)
Adjustments to reconcile net loss to net cash used in    operating activities:
Depreciation and amortization		623			509
Gain on investment		—			(24	)
Amortization of debt issuance costs		5			—
Stock-based compensation expense		990			895
Changes in operating assets and liabilities:
Accounts receivable		3,661			501
Inventories		(1,667	)		(541	)
Prepaid expenses and other assets		(214	)		417
Accounts payable		(4,876	)		816
Deferred revenue		(210	)		(649	)
Accrued expenses and other liabilities		(291	)		(959	)
Net cash used in operating activities		(4,698	)		(34	)
Cash flows from investing activities:
Capital expenditures		(1,225	)		(510	)
Proceeds from investment		—			24
Net cash used in investing activities		(1,225	)		(486	)
Cash flows from financing activities:
Borrowings under revolving loan facility, net of issuance costs		9,936			—
Taxes paid related to net share settlement of restricted stock units		(184	)		(399	)
Net cash provided by (used in) financing activities		9,752			(399	)
Effect of exchange rates on cash, cash equivalents, and restricted cash		201			(200	)
Net increase (decrease) in cash, cash equivalents, and restricted cash		4,030			(1,119	)
Cash, cash equivalents, and restricted cash at beginning of period		17,137			29,807
Cash, cash equivalents, and restricted cash at end of period	$	21,167		$	28,688
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	28		$	3
Taxes paid, net	$	27		$	32
Non-cash investing and financing activities:
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$	323		$	—

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

6

IDENTIV, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of Identiv, Inc. and its wholly owned subsidiaries (the “Company”). All intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications have been made to the fiscal year 2022 condensed consolidated financial statements to conform to the fiscal year 2023 presentation. The reclassifications had no impact on net loss, total assets, total liabilities, or stockholders’ equity.

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the Company’s unaudited condensed consolidated financial statements have been included. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023 or any future period. The unaudited condensed consolidated balance sheet as of December 31, 2022 has been derived from audited consolidated financial statements at that date, but does not include all disclosures required by U.S. GAAP for complete financial statements. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Risk Factors,” and the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

2. Significant Accounting Policies and Recent Accounting Pronouncements

Significant Accounting Policies

No material changes have been made to the Company's significant accounting policies disclosed in Note 2, Significant Accounting Policies and Recent Accounting Pronouncements, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. The Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on its financial position or results of operations upon adoption.

3. Revenue

Revenue Recognition

Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. The Company enters into contracts that can include various combinations of its products, software licenses, and services, which are generally capable of being distinct and accounted for as separate performance obligations. For contracts with multiple performance obligations, the Company allocates the transaction price of the contract to each performance obligation, generally on a relative basis using its standalone selling price. The stated contract value is generally the transaction price to be allocated to the separate performance obligations. Revenue is recognized net of any taxes collected from customers that are subsequently remitted to governmental authorities.

Nature of Products and Services

The Company derives revenues from sales of hardware products, software licenses, subscriptions, professional services, software maintenance and support, and extended hardware warranties.

7

Hardware Product Revenue — The Company generally has two performance obligations in arrangements involving the sale of hardware products. The first performance obligation is to transfer the hardware product (which includes software integral to the functionality of the hardware product). The second performance obligation is to provide assurance that the product complies with its agreed-upon specifications and is free from defects in material and workmanship for a period of one to three years (i.e., assurance warranty). The entire transaction price is allocated to the hardware product and is generally recognized as revenue at the time of shipment because the customer obtains control of the product at that point in time. The Company has concluded that control generally transfers at that point in time because the customer has title to the hardware, and a present obligation to pay for the hardware. None of the transaction price is allocated to the assurance warranty component, as the Company accounts for these product warranty costs in accordance with Accounting Standards Codification (“ASC”) 460, Guarantees (“ASC 460”).

Software License Revenue — The Company’s license arrangements grant customers the perpetual right to access and use the licensed software products at the outset of an arrangement. Technical support and software updates are generally made available throughout the term of the support agreement, which is generally one to three years. The Company accounts for these arrangements as two performance obligations: (1) the software licenses, and (2) the related updates and technical support. The software license revenue is recognized when the license is delivered to the customer or made available for download, while the software updates and technical support revenue is recognized over the term of the support contract.

Subscription Revenue — Subscription revenues consist of fees received in consideration for providing customers access to one or more of the Company’s software-as-a-service (“SaaS”) based solutions. These SaaS arrangements include access to the Company’s licensed software and, in certain arrangements, use of various hardware devices over the contract term. These SaaS arrangements do not provide the customer the right to take possession of the software supporting the subscription service, or if applicable, any hardware devices at any time during the contract period, and as such are not considered separate performance obligations. Revenue is recognized ratably on a straight-line basis over the term of the contract beginning when the service is made available to the customer. Subscription contract terms range from month-to-month to six years in length and are billed monthly or annually.

Professional Services Revenue — Professional services revenue consists primarily of programming customization services performed relating to the integration of the Company’s software products with the customers other systems, such as human resources systems. Professional services contracts are generally billed on a time and materials basis and revenue is recognized as the services are performed.

Software Maintenance and Support Revenue — Support and maintenance contract revenue consists of the services provided to support the specialized programming applications performed by the Company’s professional services group. Support and maintenance contracts are typically billed at inception of the contract and recognized as revenue over the contract period, typically over a one-or three-year period.

Extended Hardware Warranties Revenue — Sales of the Company’s hardware products may also include optional extended hardware warranties, which typically provide assurance that the product will continue to function as initially intended. Extended hardware warranty contracts are typically billed at inception of the contract and recognized as revenue over the respective contract period, typically over one-to-two-year periods after the expiration of the original assurance warranty.

Performance Obligation	When Performance Obligation is Typically Satisfied	When Payment is Typically Due	How Standalone Selling Price is Typically Estimated
Hardware products	When customer obtains control of the product (point-in-time)	Within 30-60 days of shipment	Observable in transactions without multiple performance obligations
Software licenses	When license is delivered to customer or made available for download, and the applicable license period has begun (point-in-time)	Within 30-60 days of the beginning of license period	Established pricing practices for software licenses bundled with software maintenance, which are separately observable in renewal transactions
Subscriptions	Ratably over the course of the subscription term (over time)	In advance of subscription term	Contractually stated or list price
Professional services	As services are performed and/or when contract is fulfilled (point-in-time)	Within 30-60 days of delivery	Observable in transactions without multiple performance obligations
Software maintenance and support services	Ratably over the course of the support contract (over time)	Within 30-60 days of the beginning of the contract period	Observable in renewal transactions
Extended hardware warranties	Ratably over the course of the support contract (over time)	Within 30-60 days of the beginning of the contract period	Observable in renewal transactions

8

Significant Judgments

The Company’s contracts with customers often include promises to transfer multiple products and services to a customer. For such arrangements, the Company allocates the transaction price to each performance obligation based on its relative standalone selling price (“SSP”).

Judgment is required to determine the SSP for each distinct performance obligation in a contract. For the majority of items, the Company estimates SSP using historical transaction data. The Company uses a range of amounts to estimate SSP when it sells each of the products and services separately and needs to determine whether there is a discount to be allocated based on the relative SSP of the various products and services. In instances where SSP is not directly observable, such as when the product or service is not sold separately, the Company determines the SSP using information that may include market conditions and other observable inputs. The determination of SSP is an ongoing process and information is reviewed regularly in order to ensure SSPs reflect current information or trends.

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers based on the timing of transfer of goods or services to customers (point-in-time or over time) and geographic region based on the shipping location of the customer. The geographic regions that are tracked are the Americas, Europe and the Middle East, and Asia-Pacific regions.

Total net revenue based on the disaggregation criteria described above is as follows (in thousands):

	Three Months Ended March 31,
	2023						2022
	Point-in- Time		Over Time		Total		Point-in- Time		Over Time		Total
Americas	$	20,874	$	754	$	21,628	$	15,898	$	993	$	16,891
Europe and the Middle East		2,899		85		2,984		3,669		125		3,794
Asia-Pacific		1,385		—		1,385		4,376		—		4,376
Total	$	25,158	$	839	$	25,997	$	23,943	$	1,118	$	25,061

Contract Balances

Amounts invoiced in advance of services being provided are accounted for as deferred revenue. Nearly all of the Company’s deferred revenue balance is related to software maintenance contracts. Payment terms and conditions vary by contract type, although payment is typically due within 30 to 60 days of contract inception. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined its contracts do not include a significant financing component. The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company’s products and services, not to receive financing from its customers.

Changes in deferred revenue during the three months ended March 31, 2023 and 2022 were as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Deferred revenue, beginning of period	$	2,655		$	2,433
Deferral of revenue billed in current period, net of recognition		504			381
Recognition of revenue deferred in prior periods		(714	)		(1,030	)
Deferred revenue, end of period	$	2,445		$	1,784

Amounts recognized as revenue in excess of amounts billed are recorded as unbilled receivables and are included in other current assets on the condensed consolidated balances sheets. As of March 31, 2023 and December 31, 2022, the amount of unbilled receivables was immaterial.

Unsatisfied Performance Obligations

Revenue expected to be recognized in future periods related to remaining performance obligations, excluding revenue pertaining to contracts that have an original expected duration of one year or less, and contracts where revenue is recognized as invoiced, was approximately $1.1 million as of March 31, 2023. Since the Company typically invoices customers at contract inception, this amount is included in the deferred revenue balance. As of March 31, 2023, the Company expects to recognize 38% of the revenue related to these unsatisfied performance obligations during the remainder of 2023, 31% during 2024, and 31% thereafter.

9

4. Fair Value Measurements

The Company determines the fair values of its financial instruments based on a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The classification of a financial asset or liability within the hierarchy is based upon the lowest level input that is significant to the fair value measurement. Under ASC 820, Fair Value Measurement and Disclosures, the fair value hierarchy prioritizes the inputs into three levels that may be used to measure fair value:

•Level 1 – Quoted prices (unadjusted) for identical assets and liabilities in active markets;

•Level 2 – Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly; and

•Level 3 – Unobservable inputs.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

As of March 31, 2023 and December 31, 2022, the only assets measured and recognized at fair value on a recurring basis were nominal cash equivalents. As of March 31, 2023 and December 31, 2022, there were no liabilities measured and recognized at fair value on a recurring basis.

Assets and Liabilities Measured at Fair Value on a Non-recurring Basis

Certain of the Company's assets, including goodwill, intangible assets, and privately-held investments, are measured at fair value on a nonrecurring basis if impairment is indicated. Purchased intangible assets are measured at fair value primarily using discounted cash flow projections. For additional discussion of measurement criteria used in evaluating potential impairment involving goodwill and intangible assets, refer to Note 5, Goodwill and Intangible Assets.

As of March 31, 2023 and December 31, 2022, the Company had $348,000 of privately-held investments measured at fair value on a nonrecurring basis, which were classified as Level 3 assets due to the absence of quoted market prices and inherent lack of liquidity. The Company reviews its investments to identify and evaluate investments that have an indication of possible impairment. The Company adjusts the carrying value for its privately-held investments for any impairment if the fair value is less than the carrying value of the respective assets on an other-than-temporary basis. The amount of privately-held investments is included in other assets in the accompanying condensed consolidated balance sheets.

As of March 31, 2023 and December 31, 2022, there were no liabilities that are measured and recognized at fair value on a non-recurring basis.

Assets and Liabilities Not Measured at Fair Value

The carrying amounts of the Company's accounts receivable, prepaid expenses and other current assets, accounts payable, and other accrued liabilities approximate fair value due to their short maturities. The carrying value of the Company's financial liabilities approximates fair value based upon borrowing rates currently available to the Company for loans with similar terms.

10

5. Goodwill and Intangible Assets

Goodwill

The following table summarizes the activity in goodwill (in thousands):

	Identity		Premises		Total
Balance as of January 1, 2022	$	3,554	$	6,714	$	10,268
Currency translation adjustment		—		20		20
Balance as of March 31, 2022	$	3,554	$	6,734	$	10,288
Balance as of January 1, 2023	$	3,554	$	6,636	$	10,190
Currency translation adjustment		—		2		2
Balance as of March 31, 2023	$	3,554	$	6,638	$	10,192

In accordance with ASC 350, Intangibles – Goodwill and Other, the Company tests goodwill for impairment on an annual basis, in the fourth quarter, or whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. The Company performs an initial assessment of qualitative factors to determine whether the existence of events and circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. In performing the qualitative assessment, the Company identifies and considers the significance of relevant key factors, events, and circumstances that affect the fair value of its reporting units. These factors include external factors such as macroeconomic, industry, and market conditions, as well as entity-specific factors, such as actual and planned financial performance. If, after assessing the totality of relevant events and circumstances, the Company determines that it is more likely than not that the fair value of the reporting unit exceeds its carrying value and there is no indication of impairment, no further testing is performed; however, if the Company concludes otherwise, then the Company will perform the quantitative impairment test which compares the estimated fair value of the reporting unit to its carrying value, including goodwill. If the carrying amount of the reporting unit is in excess of its fair value, an impairment loss would be recorded in the condensed consolidated statements of comprehensive loss. During the three months ended March 31, 2023 and 2022, the Company noted no indicators of goodwill impairment and concluded no further testing was necessary.

Intangible Assets

The following table summarizes the gross carrying amount and accumulated amortization for intangible assets resulting from acquisitions (in thousands):

				Developed			Customer
	Trademarks			Technology			Relationships			Total
Amortization period (in years)	5			10 – 12			4 – 12
Gross carrying amount as of March 31, 2023	$	765		$	9,093		$	15,744		$	25,602
Accumulated amortization		(719	)		(6,777	)		(13,107	)		(20,603	)
Intangible assets, net as of March 31, 2023	$	46		$	2,316		$	2,637		$	4,999
Gross carrying amount as of December 31, 2022	$	766		$	9,093		$	15,743		$	25,602
Accumulated amortization		(691	)		(6,666	)		(12,980	)		(20,337	)
Intangible assets, net as of December 31, 2022	$	75		$	2,427		$	2,763		$	5,265

Each period, the Company evaluates the estimated remaining useful lives of purchased intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. If a revision to the remaining period of amortization is warranted, amortization is prospectively adjusted over the remaining useful life of the intangible asset. Intangible assets subject to amortization are amortized on a straight-line basis over their useful lives as indicated in the table above. The Company performs an evaluation of its amortizable intangible assets for impairment at the end of each reporting period. The Company did not identify any impairment indicators during the three months ended March 31, 2023.

11

The following table summarizes the amortization expense included in the condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Cost of revenue	$	111	$	112
Selling and marketing		155		168
Total	$	266	$	280

The estimated annual future amortization expense for purchased intangible assets with definite lives as of March 31, 2023 was as follows (in thousands):

2023 (remaining nine months)	$	773
2024		956
2025		956
2026		956
2027		956
Thereafter		402
Total	$	4,999

6. Balance Sheet Components

The Company’s inventories are stated at the lower of cost or net realizable value. Inventories consists of (in thousands):

	March 31, 2023		December 31, 2022
Raw materials	$	14,489	$	13,333
Work-in-progress		—		55
Finished goods		16,120		15,570
Total	$	30,609	$	28,958

Property and equipment, net consists of (in thousands):

	March 31, 2023			December 31, 2022
Building and leasehold improvements	$	2,742		$	1,941
Furniture, fixtures and office equipment		890			726
Plant and machinery		15,586			15,311
Purchased software		732			718
Total		19,950			18,696
Accumulated depreciation		(12,355	)		(11,977	)
Property and equipment, net	$	7,595		$	6,719

The Company recorded depreciation expenses of $0.4 million and $0.2 million during the three months ended March 31, 2023 and 2022, respectively.

Other accrued expenses and liabilities consist of (in thousands):

	March 31, 2023		December 31, 2022
Accrued professional fees	$	485	$	574
Accrued warranties		341		345
Other accrued expenses		1,822		1,699
Total	$	2,648	$	2,618

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7. Financial Liabilities

The Company’s financial liabilities consist of (in thousands):

	March 31,			December 31,
	2023			2022
Revolving loan facility	$	10,000		$	—
Less: Unamortized debt issuance costs		(59	)		—
Financial liabilities, net of debt issuance costs	$	9,941		$	—

On February 8, 2017, the Company entered into a Loan and Security Agreement (as amended or amended and restated from time to time, the “Loan Agreement”) with East West Bank (“EWB”). Following subsequent amendments, on April 14, 2022, the Company and EWB amended the Loan Agreement replacing the $20.0 million revolving loan facility subject to a borrowing base with a non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023. In addition, the interest rate was lowered from prime to prime minus 0.25% (interest rate as of March 31, 2023 was 7.75%), and certain financial covenants were amended. On February 8, 2023, the Company entered into an amendment (the "Fourth Amendment") to the Loan Agreement. The Fourth Amendment amends the Loan Agreement to, among other things, extend the maturity date to February 8, 2025, and amend certain financial covenants.

The Loan Agreement contains customary representations and warranties and customary affirmative and negative covenants, including, limits or restrictions on the Company’s ability to incur liens, incur indebtedness, make certain restricted payments (including dividends), merge or consolidate and dispose of assets, as well as other financial covenants. The Company’s obligations under the Loan Agreement are collateralized by substantially all of its assets. As of March 31, 2023, there was $10.0 million outstanding and the Company was in compliance with all financial covenants under the Loan Agreement. On May 4, 2023, the Company repaid $7.0 million of the amounts outstanding under the revolving loan facility.

8. Income Taxes

The Company conducts business globally and, as a result, files federal, state and foreign tax returns. The Company strives to resolve open matters with each tax authority at the examination level and could reach agreement with a tax authority at any time. While the Company has accrued for amounts it believes are the probable outcomes, the final outcome with a tax authority may result in a tax liability that is more or less than that reflected in the condensed consolidated financial statements. Furthermore, the Company may later decide to challenge any assessments, if made, and may exercise its right to appeal.

The Company applies the provisions of, and accounted for uncertain tax positions, in accordance with ASC 740, Income Taxes (“ASC 740”), which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. It prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.

The Company generally is no longer subject to tax examinations for years prior to 2017. However, if loss carryforwards of tax years prior to 2017 are utilized in the U.S., these tax years may become subject to investigation by the tax authorities. While timing of the resolution and/or finalization of tax audits is uncertain, the Company does not believe that its unrecognized tax benefits would materially change in the next 12 months.

On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 (the “Act”) into law. The $1.9 trillion Act includes COVID-19 relief, as well as broader stimulus, but also includes several revenue-raising and business tax provisions. The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) also includes several significant provisions for corporations, including the usage of net operating losses and payroll benefits. Several foreign (non-U.S.) jurisdictions in which the Company operates have taken similar economic stimulus measures. The Act and the CARES Act had no material impact on the Company’s condensed consolidated financial statements and disclosures.

The Inflation Reduction Act (the “IRA”) was signed into the law on August 16, 2022. The IRA provides for a minimum tax on certain corporations having more than $1 billion in revenue, excise taxes on share buybacks and changes to various types of tax credits. The Company believes the IRA will have little to no effect on the Company’s income taxes. The Company will continue to assess as the provisions are clarified.

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9. Stockholders’ Equity

Series B Convertible Preferred Stock Dividend Accretion

The following table summarizes Series B convertible preferred stock and the accretion of dividend activity for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Series B Convertible Preferred Stock:
Balance at beginning of period	$	25,323	$	24,117
Cumulative dividends on Series B convertible preferred stock		313		298
Balance at end of period	$	25,636	$	24,415
Number of Common Shares Issuable Upon Conversion:
Number of shares at beginning of period		6,331		6,029
Cumulative dividends on Series B convertible preferred stock		78		75
Number of shares at end of period		6,409		6,104

Based on the current conversion price, the outstanding shares, including the accretion of dividends, of Series B convertible preferred stock as of March 31, 2023 would be convertible into 6,409,010 shares of the Company’s common stock. However, the conversion rate will be subject to adjustment in certain instances, such as if the Company issues shares of its common stock at a price less than $4.00 per common share, subject to a minimum conversion price of $3.27 per share. As of March 31, 2023, none of the contingent conditions to adjust the conversion rate had been met.

Each share of Series B convertible preferred stock is entitled to a cumulative annual dividend of 5% for the first six years following the issuance of such share and 3% for each year thereafter, with the Company retaining the option to settle each year’s dividend after the 10th year in cash. The dividends accrue and are payable in kind upon such time as the shares convert into the Company’s common stock. In general, the shares are not entitled to vote except in certain limited cases, including in change of control transactions where the expected price per share distributable to the Company’s stockholders is expected to be less than $4.00 per share. The Certificate of Designation with respect to the Series B convertible preferred stock further provides that in the event of, among other things, any change of control, liquidation or dissolution of the Company, the holders of the Series B convertible preferred stock will be entitled to receive, on a pari passu basis with the holders of the common stock, the same amount and form of consideration that the holders of the Company’s common stock receive (on an as-if-converted-to-common-stock basis and without regard to the Beneficial Ownership Limitation (as defined in the Certificate of Designation) applicable to the Series B convertible preferred stock).

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Common Stock Warrants

On May 5, 2020, the Company entered into a Note and Warrant Purchase Agreement with 21 April Fund, LP and 21 April Fund, Ltd., (collectively, the “April 21 Funds”), pursuant to which the Company issued warrants (“April 21 Funds Warrants”) to purchase 275,000 shares of common stock of the Company. The April 21 Funds Warrants have a term of three years (subject to early termination upon the closing of an acquisition). The shares of common stock issuable upon exercise of the April 21 Fund Warrants are entitled to resale registration rights pursuant to a Stockholders Agreement dated December 21, 2017.

Below is the summary of outstanding warrants as of March 31, 2023:

Warrant Type	Number of Shares Issuable Upon Exercise		Weighted Average Exercise Price		Issue Date	Expiration Date
April 21 Funds Warrants		275,000	$	3.50	May 5, 2020	May 5, 2023

On April 24, 2023, April 21 Funds exercised their warrants, receiving 275,000 shares of the Company's common stock which resulted in the Company receiving $962,500 in cash proceeds.

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance as of March 31, 2023 was as follows:

Exercise of outstanding stock options, vesting of restricted stock units ("RSUs"), vesting of      performance stock units ("PSUs"), and issuance of RSUs vested but not released	1,556,124
Employee Stock Purchase Plan	293,888
Shares of common stock available for grant under the 2011 Plan	416,955
Warrants to purchase common stock	275,000
Shares of common stock issuable upon conversion of Series B convertible preferred stock	7,541,449
Total	10,083,416

10. Stock-Based Compensation

Stock Incentive Plan

The Company maintains a stock-based compensation plan, the 2011 Incentive Compensation Plan (the “2011 Plan”), as amended, to attract, motivate, retain and reward employees, directors and consultants by providing its Board or a committee of the Board the discretion to award equity incentives to these persons.

Stock Options

A summary of stock option activity for the three months ended March 31, 2023 is as follows:

	Number Outstanding		Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Balance as of January 1, 2023		505,593	$	5.05		3.17	$	1,280,805
Granted		—		—
Cancelled or Expired		—		—
Exercised		—		—
Balance as of March 31, 2023		505,593	$	5.05		2.93	$	791,309
Vested or expected to vest as of March 31, 2023		505,593	$	5.05		2.93	$	791,309
Exercisable as of March 31, 2023		505,593	$	5.05		2.93	$	791,309

The aggregate intrinsic value in the table above represents the difference between the fair value of the Company’s common stock as of March 31, 2023 and the exercise price of in-the-money stock options multiplied by the number of such stock options.

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The following table summarizes information about stock options outstanding as of March 31, 2023:

	Stock Options Outstanding						Stock Options Exercisable
Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$4.36 - $7.20		445,960		3.18	$	4.37		445,960	$	4.37
$7.50 - $11.25		59,100		1.05		10.17		59,100		10.17
$11.30 - $16.95		500		1.00		11.30		500		11.30
$19.70 - $29.55		33		0.38		19.70		33		19.70
$4.36 - $29.55		505,593		2.93	$	5.05		505,593	$	5.05

As of March 31, 2023, there was no unrecognized stock-based compensation expense related to stock options.

Restricted Stock Units

The following is a summary of RSU activity for the three months ended March 31, 2023:

	Number Outstanding			Weighted Average Fair Value
Unvested as of January 1, 2023		819,185		$	13.23
Granted		151,123			6.96
Vested		(84,816	)		13.35
Forfeited		(12,729	)		12.62
Unvested as of March 31, 2023		872,763		$	12.14
RSUs vested but not released		137,768		$	7.00

The fair value of the Company’s RSUs is calculated based upon the fair market value of the Company’s common stock at the date of grant. As of March 31, 2023, there was $8.6 million of unrecognized compensation expense related to unvested RSUs granted, which is expected to be recognized over a weighted average period of 3.1 years. No tax benefit was realized from RSUs for the three months ended March 31, 2023.

Performance Stock Units

The Company grants PSUs to certain key employees that are subject to the attainment of performance goals established by the Company’s Compensation Committee, the periods during which performance is to be measured, and other limitations and conditions. Performance goals are based on pre-established objectives that specify the manner of determining the number of PSUs that will vest if performance goals are attained. If an employee terminates employment, the non-vested portion of the PSUs will not vest and all rights to the non-vested portion will terminate.

The following is a summary of PSU activity for the three months ended March 31, 2023:

	Number Outstanding		Weighted Average Fair Value
Unvested as of January 1, 2023		40,000	$	8.51
Granted		—		—
Vested		—		—
Forfeited		—		—
Unvested as of March 31, 2023		40,000	$	8.51

As of March 31, 2023, there was $0.2 million of unrecognized compensation expense related to unvested PSUs, which is expected to be recognized over a period of 0.75 years. No tax benefit was realized from PSUs for the three months ended March 31, 2023.

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Stock-Based Compensation Expense

The following table summarizes stock-based compensation expense related to stock options, RSUs, and PSUs included in the condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Cost of revenue	$	45	$	56
Research and development		202		310
Selling and marketing		293		194
General and administrative		450		335
Total	$	990	$	895

Restricted Stock Unit Net Share Settlements

During the three months ended March 31, 2023 and 2022, the Company repurchased 24,812 and 17,647 shares, respectively, of common stock surrendered to the Company to satisfy tax withholding obligations in connection with the vesting of RSUs issued to employees.

11. Net Loss per Common Share

Basic net loss per common share is computed by dividing net loss available to common stockholders during the period by the weighted average number of common shares outstanding during that period. Diluted net loss per common share is impacted by equity instruments considered to be potential common shares, if dilutive, computed using the treasury stock or the if-converted method of accounting. Dilutive potential common share equivalents are excluded from the computation of net income (loss) per share in loss periods, as their effect would be antidilutive.

	Three Months Ended March 31,
	2023			2022
Basic net loss per common share:
Numerator:
Net loss	$	(2,719	)	$	(999	)
Less: accretion of Series B convertible preferred stock dividends		(313	)		(298	)
Net loss available to common stockholders	$	(3,032	)	$	(1,297	)
Denominator:
Weighted average common shares outstanding - basic		22,794			22,574
Net loss per common share - basic	$	(0.13	)	$	(0.06	)

The following common stock equivalents have been excluded from diluted net loss per share for the three months ended March 31, 2023 and 2022 because their inclusion would have been anti-dilutive (in thousands):

	Three Months Ended March 31,
	2023		2022
Shares of common stock subject to outstanding RSUs		873		557
Shares of common stock subject to outstanding PSUs		40		75
Shares of common stock subject to outstanding stock options		506		514
Shares of common stock subject to outstanding warrants		275		275
Shares of common stock issuable upon conversion of Series B    convertible preferred stock		6,409		6,104
Total		8,103		7,525

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12. Segment Reporting, Geographic Information, and Concentration of Credit Risk

Segment Reporting

ASC 280, Segment Reporting establishes standards for the reporting by public business enterprises of information about operating segments, products and services, geographic areas, and major customers. The method for determining what information to report is based on the way management organizes the operating segments within the Company for making operating decisions and assessing financial performance. An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenue and incur expenses and about which separate financial information is available to its chief operating decision makers (“CODM”). The Company’s CODM is its Chief Executive Officer.

The CODM reviews financial information and business performance for each operating segment. The Company evaluates the performance of its operating segments at the revenue and gross profit levels. The Company does not report total assets, capital expenditures or operating expenses by operating segment as such information is not used by the CODM for purposes of assessing performance or allocating resources.

Net revenue and gross profit information by segment for the three months ended March 31, 2023 and 2022 are as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Identity:
Net revenue	$	14,678		$	14,579
Gross profit		3,079			3,159
Gross profit margin		21	%		22	%
Premises:
Net revenue		11,319			10,482
Gross profit		6,132			5,807
Gross profit margin		54	%		55	%
Total:
Net revenue		25,997			25,061
Gross profit		9,211			8,966
Gross profit margin		35	%		36	%
Operating expenses:
Research and development		2,707			2,529
Selling and marketing		6,097			5,110
General and administrative		2,948			2,488
Restructuring and severance		191			(140	)
Total operating expenses:		11,943			9,987
Loss from operations		(2,732	)		(1,021	)
Non-operating income (expense):
Interest expense, net		(50	)		(25	)
Gain on investment		—			24
Foreign currency gains, net		89			19
Loss before income tax benefit (provision)	$	(2,693	)	$	(1,003	)

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Geographic Information

Geographic net revenue is based on the customer’s ship-to location. Information regarding net revenue by geographic region for the three months ended March 31, 2023 and 2022 is as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Americas	$	21,628		$	16,891
Europe and the Middle East		2,984			3,794
Asia-Pacific		1,385			4,376
Total	$	25,997		$	25,061
As percentage of net revenue:
Americas		83	%		67	%
Europe and the Middle East		12	%		15	%
Asia-Pacific		5	%		18	%
Total		100	%		100	%

Concentration of Credit Risk

One customer accounted for 11% of net revenue for the three months ended March 31, 2023. No customer accounted for more than 10% of net revenue for the three months ended March 31, 2022. No customer accounted for 10% or more of net accounts receivable as of March 31, 2023 or December 31, 2022.

Long-lived assets by geographic location as of March 31, 2023 and December 31, 2022 are as follows (in thousands):

	March 31, 2023		December 31, 2022
Property and equipment, net:
Americas	$	706	$	530
Europe and the Middle East		490		458
Asia-Pacific		6,399		5,731
Total property and equipment, net	$	7,595	$	6,719
Operating lease ROU assets:
Americas	$	3,440	$	3,637
Europe and the Middle East		350		384
Asia-Pacific		554		352
Total operating lease right-of-use assets	$	4,344	$	4,373

13. Restructuring and Severance

During the three months ended March 31, 2023, restructuring expenses consisted of severance related costs of $191,000. During the three months ended March 31, 2022, the Company entered into a settlement agreement associated with outstanding rental payments due the landlord on leased office space in San Francisco, California. As a result of the settlement, the Company recorded a net credit of $153,000 representing the difference between amounts accrued and the settlement amount. The settlement credit was partially offset by severance related costs of $13,000.

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14. Leases

The Company’s leases consist primarily of operating leases for administrative office space, research and development facilities, a manufacturing facility, and sales offices in various countries around the world. The Company determines if an arrangement is a lease at inception. Some lease agreements contain lease and non-lease components, which are accounted for as a single lease component. Total rent expense was $0.4 million and $0.3 million for the three months ended March 31, 2023 and 2022, respectively.

Initial lease terms are determined at commencement and may include options to extend or terminate the lease when it is reasonably certain the Company will exercise the option. Remaining lease terms range from one to five years, some of which include options to extend for up to five years. Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets. As the Company’s leases do not provide an implicit rate, the present value of future lease payments is determined using the Company’s incremental borrowing rate based on information available at the lease commencement date.

The table below reconciles the undiscounted cash flows for the first five years and the total of the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of March 31, 2023 (in thousands):

	March 31, 2023
2023 (remaining nine months)	$	1,063
2024		1,285
2025		1,051
2026		836
2027		798
Thereafter		13
Total minimum lease payments		5,046
Less: amount of lease payments representing interest		(476	)
Present value of future minimum lease payments		4,570
Less: current liabilities under operating leases		(1,199	)
Long-term operating lease liabilities	$	3,371

As of March 31, 2023, the weighted average remaining lease term for the Company’s operating leases was 3.0 years, and the weighted average discount rate used to determine the present value of the Company’s operating leases was 6.3%.

Cash paid for amounts included in the measurement of operating lease liabilities was $0.4 million and $0.3 million for the three months ended March 31, 2023 and 2022, respectively.

15. Commitments and Contingencies

The following table summarizes the Company’s principal contractual commitments, excluding operating leases, as of March 31, 2023 (in thousands):

	Purchase Commitments		Other Contractual Commitments		Total
2023 (remaining nine months)	$	50,158	$	67	$	50,225
2024		7,744		—		7,744
2025		4,005		—		4,005
Total	$	61,907	$	67	$	61,974

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Purchase commitments for inventories are highly dependent upon forecasts of customer demand. Due to the uncertainty in demand from its customers, the Company may have to change, reschedule, or cancel purchases or purchase orders from its suppliers. These changes may lead to vendor cancellation charges on these purchases or contractual commitments.

The following table summarizes the Company’s warranty accrual account activity during the three months ended March 31, 2023 and 2022:

	Three Months Ended March 31,
	2023			2022
Balance at beginning of period	$	345		$	377
Charged (credited) to costs and expenses		(5	)		14
Cost of warranty claims		1			1
Balance at end of period	$	341		$	392

The Company provides warranties on certain product sales for periods ranging from 12 to 36 months, and allowances for estimated warranty costs are recorded during the period of sale. The determination of such allowances requires the Company to make estimates of product return rates and expected costs to repair or to replace the products under warranty. The Company currently establishes warranty reserves based on historical warranty costs for each product line combined with liability estimates based on the prior 12 months’ sales activities. If actual return rates and/or repair and replacement costs differ significantly from the Company’s estimates, adjustments to recognize additional cost of sales may be required in future periods. Historically, the warranty accrual and the expense amounts have been immaterial.

16. Subsequent Events

There were no subsequent events except as disclosed within Note 7, Financial Liabilities and Note 9, Stockholders' Equity.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and other parts of this Quarterly Report on Form 10-Q (“Quarterly Report”) contain forward-looking statements, within the meaning of the safe harbor provisions under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. Forward-looking statements reflect current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “will,” “believe,” “could,” “should,” “would,” “may,” “anticipate,” “intend,” “plan,” “estimate,” “expect,” “project” or the negative of these terms or other similar expressions. Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in Part II, Item 1A of this Report and in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2022 under the heading “Risk Factors,” The following discussion should be read in conjunction with the audited consolidated financial statements and notes thereto included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2022. We assume no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Each of the terms the “Company,” “Identiv,” “we,” “us” and “our” as used herein refers collectively to Identiv, Inc. and its wholly-owned subsidiaries, unless otherwise stated.

Overview

Identiv is a global provider of secure identification and physical security.

We are leveraging our Radio Frequency Identification (“RFID”)-enabled physical device-management expertise as well as our physical access, video and analytics solutions to provide leading solutions as our customers, and our customers’ customers, embracing the Internet of Things (“IoT”). Customers in the technology and mobility, consumer, government, healthcare, education and other sectors rely on Identiv’s identification and access solutions. Identiv’s platform encompasses RFID and Near-Field Communication (“NFC”), cybersecurity, and the full spectrum of physical access, video, and audio security. We are bringing the benefits of the IoT to a wide range of physical, connected items.

Identiv’s mission is to digitally enable every physical thing and every physical place on the planet. Our full continuum of security solutions is delivered through our platform of RFID-enabled devices, mobile, client/server, cloud, web, dedicated hardware and software defined architectures. In doing so, we believe that we will create smart physical security and a smarter physical world.

Segments

We have organized our operations into two reportable business segments, principally by solution families: Identity and Premises. Our Identity segment includes products and solutions enabling secure access to information serving the logical access and cyber-security market, and protecting connected objects and information using RFID embedded security. Our Premises segment includes our solutions to address the premises security market for government and enterprise, including access control, video surveillance, analytics, audio, access readers and identities.

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Factors Affecting Our Performance

Market Adoption

Our financial performance depends on the pace, scope and depth of end-user adoption of our RFID products in multiple industries. Such pace, scope and depth accelerated during 2020, causing large fluctuations in our operating results. During 2021, we believe RFID deployments occurred at a much faster pace of growth than historically. We believe significant improvement in chip capabilities at lower costs, combined with the incorporation of the full NFC Data Exchange Format (“NDEF”) protocol by Apple Inc. in its iPhone 12 and iOS 14, has accelerated the opportunities for product engineers to integrate RFID into their products to create new and more engaging customer experiences, product reliability and performance. As the market hit this pivot point, we expanded both our capacity and technical leadership. We track growth indicators including design wins, customer launches and technology launches. We have made investments in our technology, world class quality and automation, and we believe that our competitive advantages will continue to drive growth.

We believe the underlying, long-term trend is continued RFID adoption by multiple verticals. We also believe that expanding use cases fosters adoption across verticals and into other markets. In addition, we do not have any significant concentration of customers so we believe that our demand will continue to be resilient to the loss of any individual customer or application.

If RFID market adoption, and adoption of our products specifically, does not meet our expectations then our growth prospects and operating results will be adversely affected. If we are unable to meet end-user or customer volume or performance expectations, then our business prospects may be adversely affected. In contrast, if our RFID sales exceed expectations, then our revenue and profitability may be positively affected.

Given the uncertainties of the specific timing of our new customer deployments, we cannot assure you that we have appropriate inventory and capacity levels or that we will not experience inventory shortfalls or overages in the future or acquire inventory at costs to maintain gross margins. We attempt to mitigate those risks by being deeply embedded in our customers’ design cycles, working with our chip partners on long lead time components, managing our limited capital equipment needs within a short cycle and future proofing our facilities to accommodate several scenarios for growth potential.

If end users with sizable projects change or delay them, we may experience significant fluctuation in revenue on a quarterly or annual basis, and we anticipate that uncertainty to continue to characterize our business for the foreseeable future.

Seasonality and Other Factors

We experience variations in demand for our offerings from quarter to quarter, and typically experience a stronger demand cycle in the second half of our fiscal year. Sales of our physical access control solutions and related products to U.S. Government agencies are subject to annual government budget cycles and generally are highest in the third quarter of each year. Sales of our Identity readers, many of which are sold to government agencies worldwide, are impacted by project schedules of government agencies, as well as roll-out schedules for application deployments. Further, this business is typically subject to seasonality based on differing commercial and global government budget cycles. Lower sales are expected in the U.S. in the first half, and in particular, the first quarter of the year, with higher sales typically in the second half of each year. In the Asia-Pacific, with fiscal year-ends in March and June, order demand can be higher in the first quarter as customers attempt to complete projects before the end of the fiscal year. Accordingly, our net revenue levels in the first quarter each year often depend on the relative strength of project completions and sales mix between our U.S. customer base and our international customer base.

Purchasing of our Products and Services for U.S. Federal Government Security Programs

In addition to the general seasonality of demand, overall U.S. Federal Government expenditure patterns have a significant effect on demand for our products due to the significant portion of revenue that is typically sourced from U.S. Federal Government agencies. Drivers of growth included our technology strength and proven security solutions, work-from-home mandates, and continued strength in investments for security across a number of different agencies. We believe that the success and growth of our business will continue through the U.S. Federal Government focus on security and our successful procurement of government business. If there are changes in government purchasing policies or budgetary constraints, there could be implications for our growth prospects and operating results. If we are unable to meet end-user or customer volume or performance expectations, then our business prospects and operating results may be adversely affected.

Impacts of Macroeconomic Conditions and Other Factors on our Business

The COVID-19 pandemic and the responses to combat it have had a negative impact on the global economy, including industry-wide global supply chain challenges, such as manufacturing, transportation and logistics. We purchase certain products and key components from a limited number of sources that depend on the supply chain, including freight, to receive components, transport finished goods and deliver our products across the world. In view of the rapidly changing business environment, we have experienced

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delays and reductions in customer orders, shifting supply chain availability, component shortages, and other production-related challenges. We are currently unable to determine if there will be any continued disruption and the extent to which this may have future impact on our business. We continue to monitor the global supply chain challenges and its effect on our financial position, results of operations, and cash flows.

More recently, we have also been impacted by other adverse macroeconomic conditions, including but not limited to, inflation, foreign currency fluctuations, and the slowdown of economic activity around the globe. These conditions have also impacted our suppliers, contract manufacturers, logistics providers, and distributors, causing increases in cost of materials and higher shipping and transportation rates, which then impacted the pricing of our products. Price increases may not successfully offset cost increases or may cause us to lose market share and, in turn, may adversely impact our financial position, results of operations, and cash flows.

Results of Operations

The following table includes net revenue and net profit information by business segment and reconciles gross profit to loss before income tax benefit (provision) (in thousands).

	Three Months Ended March 31,
	2023			2022			% Change
Identity:
Net revenue	$	14,678		$	14,579			1	%
Gross profit		3,079			3,159			(3	%)
Gross profit margin		21	%		22	%
Premises:
Net revenue		11,319			10,482			8	%
Gross profit		6,132			5,807			6	%
Gross profit margin		54	%		55	%
Total:
Net revenue		25,997			25,061			4	%
Gross profit		9,211			8,966			3	%
Gross profit margin		35	%		36	%
Operating expenses:
Research and development		2,707			2,529			7	%
Selling and marketing		6,097			5,110			19	%
General and administrative		2,948			2,488			18	%
Restructuring and severance		191			(140	)		(236	%)
Total operating expenses:		11,943			9,987			20	%
Loss from operations		(2,732	)		(1,021	)		168	%
Non-operating income (expense):
Interest expense, net		(50	)		(25	)		100	%
Gain on investment		—			24			(100	%)
Foreign currency gains, net		89			19			368	%
Loss before income tax benefit (provision)	$	(2,693	)	$	(1,003	)		168	%

Geographic net revenue based on each customer’s ship-to location is as follows (in thousands):

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	Three Months Ended March 31,
	2023			2022			% Change
Americas	$	21,628		$	16,891			28	%
Europe and the Middle East		2,984			3,794			(21	%)
Asia-Pacific		1,385			4,376			(68	%)
Total	$	25,997		$	25,061
Percentage of net revenue:
Americas		83	%		67	%
Europe and the Middle East		12	%		15	%
Asia-Pacific		5	%		18	%
Total		100	%		100	%

Net Revenue

Net revenue for the three months ended March 31, 2023 was $26.0 million, an increase of 4% compared with $25.1 million for the comparable period of 2022. Net revenue in the Americas was $21.6 million for the three months ended March 31, 2023, an increase of 28% compared to $16.9 million for the comparable period of 2022. Net revenue in Europe, the Middle East, and the Asia-Pacific was approximately $4.4 million for the three months ended March 31, 2023, a decrease of 47% compared with the comparable period of 2022.

Identity Segment

Net revenue in our Identity segment was $14.7 million for the three months ended March 31, 2023, an increase of 1% compared with $14.6 million for the comparable period of 2022. Net revenue in this segment for the three months ended March 31, 2023 represented 56% of our net revenue, compared to 58% in the comparable period of the prior year.

Net revenue in this segment in the Americas for the three months ended March 31, 2023 increased 49% compared to the three months ended March 31, 2022. The increase was primarily due to higher sales of RFID transponder products to consumer products contract manufacturers and higher sales of access cards.

Net revenue in this segment in Europe, the Middle East, and the Asia-Pacific for the three months ended March 31, 2023 decreased 49% compared with the comparable period of 2022. The decrease was primarily due to lower sales of RFID transponder products, access cards and our legacy smart card readers to existing customers in the medical device and library markets.

Premises Segment

Net revenue in our Premises segment was $11.3 million for the three months ended March 31, 2023, an increase of 8% compared with $10.5 million for the comparable period of 2022. Net revenue in our Premises segment for the three months ended March 31, 2023 represented 44% of our net revenue, compared to 42% in the comparable period of the prior year.

Net revenue in this segment in the Americas for the three months ended March 31, 2023 increased 12%, compared with the comparable period of 2022 due to higher sales of Hirsch Velocity hardware, software, and video product offerings across both federal government and commercial businesses.

Net revenue in this segment across Europe, the Middle East, and the Asia-Pacific for the three months ended March 31, 2023 decreased 26%, compared with the comparable period of 2022. Net revenue in these regions is primarily project driven and can vary period to period.

As a general trend, U.S. Federal agencies continue to be subject to security improvement mandates under programs such as Homeland Security Presidential Directive-12 (“HSPD-12”) and reiterated in memoranda from the Office of Management and Budget (“OMB M-11-11”). We believe that our solutions for trusted physical access is an attractive offering to help federal agency customers move towards compliance with federal directives and mandates. To address sales opportunities in the United States in general and with our U.S. Government customers in particular, we focus on a strong U.S. sales organization and our sales presence in Washington D.C.

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Gross Profit and Gross Margin

Gross profit for the three months ended March 31, 2023 was $9.2 million, or 35% of net revenue, compared with $9.0 million, or 36% of net revenue in the comparable period of 2022. Gross profit represents net revenue less direct cost of product sales, manufacturing overhead, other costs directly related to preparing the product for sale including freight, scrap, inventory adjustments and amortization, where applicable.

Identity Segment

In our Identity segment, gross profit in the three months ended March 31, 2023 was $3.1 million compared with $3.2 million in the comparable period of 2022. Gross profit margins in the Identity segment for the three months ended March 31, 2023 decreased to 21% from 22% in the comparable period of 2022. The decrease in gross profit margins was primarily attributable to continued investments in technology, manufacturing processes and equipment, and changes in product mix, with lower sales of higher margin legacy smart card readers and higher sales of lower margin RFID transponder products.

Premises Segment

In our Premises segment, gross profit in the three months ended March 31, 2023 was $6.1 million compared with $5.8 million in the comparable period of 2022. Gross profit margins in the Premises segment for the three months ended March 31, 2023 decreased to 54% from 55% in the comparable period of 2022. The decrease in gross profit margins was primarily attributable to changes in product mix.

We expect there will be variation in our total gross profit from period to period, as our gross profit has been and will continue to be affected primarily by varying mix among our products. Within each product category, gross margins have tended to be consistent, but over time may be affected by a variety of factors, including, without limitation, competition, product pricing, the volume of sales in any given quarter, manufacturing volumes, product configuration and mix, the availability of new products, product enhancements, software and services, risk of inventory write-downs and the cost and availability of components.

Operating Expenses

Information about our operating expenses for the three months ended March 31, 2023 and 2022 is set forth below (dollars in thousands).

Research and Development

	Three Months Ended March 31,
	2023			2022			% Change
Research and development	$	2,707		$	2,529			7	%
as a % of net revenue		10	%		10	%

Research and development expenses consist primarily of employee compensation and fees for the development of hardware, software and firmware products. We focus the bulk of our research and development activities on the continued development of existing products and the development of new offerings for emerging market opportunities.

Research and development expenses for the three months ended March 31, 2023 increased compared to the comparable prior year period primarily due to higher subscriptions and licensing costs as well as higher travel related costs.

Selling and Marketing

	Three Months Ended March 31,
	2023			2022			% Change
Selling and marketing	$	6,097		$	5,110			19	%
as a % of net revenue		23	%		20	%

Selling and marketing expenses consist primarily of employee compensation as well as amortization expense of certain intangible assets, customer lead generation activities, tradeshow participation, advertising and other marketing and selling costs.

Selling and marketing expenses for the three months ended March 31, 2023 increased compared to the three months ended March 31, 2022 primarily due to higher headcount and related payroll costs, higher stock-based compensation costs as well as higher travel related costs.

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General and Administrative

	Three Months Ended March 31,
	2023			2022			% Change
General and administrative	$	2,948		$	2,488			18	%
as a % of net revenue		11	%		10	%

General and administrative expenses consist primarily of compensation expenses for employees performing administrative functions, and professional fees incurred for legal, auditing and other consulting services.

General and administrative expenses for the three months ended March 31, 2023 increased compared to the prior year period primarily due to higher headcount and related payroll costs as well as higher stock-based compensation costs.

Restructuring and Severance Charges

	Three Months Ended March 31,
	2023		2022			% Change
Restructuring and severance	$	191	$	(140	)		(236	%)

Restructuring expenses for the three months ended March 31, 2023, consisted of severance related costs of $191,000. During the three months ended March 31, 2022, we entered into a settlement agreement associated with outstanding rental payments due the landlord on leased office space in San Francisco, California. As a result of the settlement, we recorded a net credit of $153,000 representing the difference between amounts accrued and the settlement amount. The settlement credit was partially offset by severance related costs of $13,000.

Non-operating Income (Expense)

Information about our non-operating income (expense) for the three months ended March 31, 2023 and 2022 is set forth below (dollars in thousands).

	Three Months Ended March 31,
	2023			2022			% Change
Interest expense, net	$	(50	)	$	(25	)		100	%
Gain on investment	$	—		$	24			(100	%)
Foreign currency gains, net	$	89		$	19			368	%

Interest expense, net consists of interest on financial liabilities and amortization of debt issuance costs. The increase in interest expense for the three months ended March 31, 2023 compared to the comparable period of 2022 was attributable to borrowings under our revolving loan facility with our lender in the first quarter of 2023.

Changes in currency valuation in the periods mainly were the result of exchange rate movements between the U.S. Dollar, the Indian Rupee, the Canadian Dollar, and the Euro. Our foreign currency gains and losses primarily result from the valuation of current assets and liabilities denominated in a currency other than the functional currency of the respective entity in the local financial statements.

Income Tax Benefit (Provision)

	Three Months Ended March 31,
	2023			2022			% Change
Income tax benefit (provision)	$	(26	)	$	4			(750	%)
Effective tax rate		(0	%)		0	%

As of March 31, 2023, our deferred tax assets are fully offset by a valuation allowance. Accounting Standards Codification (“ASC”) 740, Income Taxes, provides for the recognition of deferred tax assets if realization of such assets is more likely than not. Based upon the weight of available evidence, which includes historical operating performance, reported cumulative net losses since inception and difficulty in accurately forecasting our future results, we provided a full valuation allowance against all of our net U.S. and foreign deferred tax assets. We reassess the need for our valuation allowance on a quarterly basis. If it is later determined that a portion or all of the valuation allowance is not required, it generally will be a benefit to the income tax provision in the period such determination is made.

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We recorded an income tax provision during the three months ended March 31, 2023. The effective tax rates for the three months ended March 31, 2023 and 2022 differ from the federal statutory rate of 21% primarily due to a change in valuation allowance, and the provision or benefit in certain foreign jurisdictions, which are subject to higher tax rates.

Liquidity and Capital Resources

As of March 31, 2023, our working capital, defined as current assets less current liabilities, was $49.4 million, a decrease of $2.3 million compared to $51.7 million as of December 31, 2022. As of March 31, 2023, our cash and cash equivalents balance was $20.8 million.

On February 8, 2017, we entered into a Loan and Security Agreement (as amended or amended and restated from time to time, the “Loan Agreement”) with East West Bank (“EWB”). Following subsequent amendments, on April 14, 2022, we amended and restated the Loan Agreement by replacing the $20.0 million revolving loan facility subject to a borrowing base with a non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023. In addition, the interest rate was lowered from prime to prime minus 0.25%, and certain financial covenants were amended. On February 8, 2023, we entered into an amendment (the "Fourth Amendment") to the Loan Agreement. The Fourth Amendment amends the Loan Agreement to, among other things, extend the maturity date to February 8, 2025 and amend certain financial covenants. As of March 31, 2023, we were in compliance with all financial covenants under the Loan Agreement.

As our previously unremitted earnings have been subjected to U.S. federal income tax, we expect any repatriation of these earnings to the U.S. would not incur significant additional taxes related to such amounts. However, our estimates are provisional and subject to further analysis. Generally, most of our foreign subsidiaries have accumulated deficits and cash and cash equivalents that are held outside the United States are typically not cash generated from earnings that would be subject to tax upon repatriation if transferred to the United States. We have access to the cash held outside the United States to fund domestic operations and obligations without any material income tax consequences. As of March 31, 2023, the amount of cash included at such subsidiaries was $5.2 million. We have not, nor do we anticipate the need to, repatriate funds to the United States to satisfy domestic liquidity needs arising in the ordinary course of business, including liquidity needs associated with our domestic debt service requirements.

We have historically incurred operating losses and negative cash flows from operating activities, and we may continue to incur losses in the future. As of March 31, 2023, we had an accumulated deficit of $412.1 million. During the three months ended March 31, 2023, we had a net loss of $2.7 million.

We believe our existing cash and cash equivalents, together with cash generated from operations and available credit under our Loan Agreement will be sufficient to satisfy our working capital needs to fund operations for the next 12 months. We may also use cash to acquire or invest in complementary businesses, technologies, services or products that would change our cash requirements. We may also choose to finance our business through public or private equity offerings, debt financings or other arrangements. However, there can be no assurance that additional capital will be available to us or that such capital will be available to us on acceptable terms. If we raise funds by issuing equity securities, dilution to stockholders could result. Debt or any equity securities issued also may provide for rights, preferences or privileges senior to those of holders of our common stock. The terms of debt securities issued or loans could impose significant restrictions on our operations. The incurrence of additional indebtedness or the issuance of certain debt or equity securities could result in increased fixed payment obligations and could also result in restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, limitations on our ability to acquire or license intellectual property rights and other operating restrictions that could adversely affect our ability to conduct our business. Our Loan Agreement imposes restrictions on our operations, increases our fixed payment obligations and has restrictive covenants. In addition, the issuance of additional equity securities by us, or the possibility of such issuance, may cause the market price of our common stock to decline. If we are not able to secure additional funding when needed, we may have to curtail or reduce the scope of our business or forgo potential business opportunities.

The following summarizes our cash flows for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023			2022
Net cash used in operating activities	$	(4,698	)	$	(34	)
Net cash used in investing activities		(1,225	)		(486	)
Net cash provided by (used in) financing activities		9,752			(399	)
Effect of exchange rates on cash, cash equivalents, and restricted cash		201			(200	)
Net increase (decrease) in cash, cash equivalents, and restricted cash		4,030			(1,119	)
Cash, cash equivalents, and restricted cash at beginning of period		17,137			29,807
Cash, cash equivalents, and restricted cash at end of period	$	21,167		$	28,688

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Cash flows from operating activities

Cash used in operating activities for the three months ended March 31, 2023 of $4.7 million, was primarily due to net loss of $2.7 million, a decrease in cash from net changes in operating assets and liabilities of $3.6 million, which included $1.7 million in strategic inventory purchases, partially offset by adjustments for certain non-cash items of $1.6 million, consisting primarily of depreciation, amortization and stock-based compensation.

Cash used in operating activities for the three months ended March 31, 2022 of less than $0.1 million was primarily due to net loss of $1.0 million, a decrease in cash from net changes in operating assets and liabilities of $0.4 million, offset by adjustments for certain non-cash items of $1.4 million, consisting primarily of depreciation, amortization and stock-based compensation.

Cash flows from investing activities

Cash used in investing activities for the three months ended March 31, 2023 was $1.2 million, which related primarily to capital investment expenditures in our manufacturing facility in Thailand (expected to begin production in the third quarter of 2023). Cash used in investing activities for the three months ended March 31, 2022 was $0.5 million, which related primarily to capital expenditures in our manufacturing facility in Singapore.

Cash flows from financing activities

Cash provided by financing activities during the three months ended March 31, 2023 was $9.8 million, which consisted of net borrowings of $9.9 million under our revolving loan facility with our lender, partially offset by net share settlements of restricted stock units. Cash used in financing activities during the three months ended March 31, 2022 was related to net share settlements of restricted stock units of $0.4 million.

Contractual Obligations

We lease facilities, certain equipment, and automobiles under non-cancelable operating lease agreements. See Note 14, Leases, in the accompanying notes to our condensed consolidated financial statements.

Purchases for inventories are highly dependent upon forecasts of customer demand. Due to the uncertainty in demand from our customers, we may have to change, reschedule, or cancel purchases or purchase orders from our suppliers. These changes may lead to vendor cancellation charges on these orders or contractual commitments. See Note 15, Commitments and Contingencies, in the accompanying notes to our condensed consolidated financial statements.

Our other long-term liabilities include gross unrecognized tax benefits, and related interest and penalties. At this time, we are unable to make a reasonably reliable estimate of the timing of payments in individual years in connection with these tax liabilities.

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Off-Balance Sheet Arrangements

We have not entered into off-balance sheet arrangements, or issued guarantees to third parties.

Climate Change

We believe that neither climate change, nor governmental regulations related to climate change, have had a material effect on our business, financial condition or results of operations.

Critical Accounting Policies and Estimates

Our condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these condensed consolidated financial statements requires management to establish accounting policies that contain estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. These policies relate to revenue recognition, inventory, income taxes, goodwill, intangible and long-lived assets and stock-based compensation. We have other important accounting policies and practices; however, once adopted, these other policies either generally do not require us to make significant estimates or assumptions or otherwise only require implementation of the adopted policy and not a judgment as to the policy itself. Management bases its estimates and judgments on historical experience and on various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Despite our intention to establish accurate estimates and assumptions, actual results may differ from these estimates under different assumptions or conditions.

During the three months ended March 31, 2023, management believes there have been no significant changes to the items that we disclosed within our critical accounting policies and estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022.

Recent Accounting Pronouncements

See Note 2, Significant Accounting Policies and Recent Accounting Pronouncements, in the accompanying notes to our unaudited condensed consolidated financial statements in Item 1 of Part I of this Quarterly Report for a description of recent accounting pronouncements, which is incorporated herein by reference.

10b5-1 Trading Plans

From time to time, our executive officers and directors have, and we expect they will in the future, enter into written trading plans pursuant to Rule 10b5-1 of the Securities and Exchange Act of 1934.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are primarily exposed to changes in currency exchange rates as certain of our operations are conducted in foreign currencies such as the Indian Rupee, the Canadian Dollar, and the Euro.

Economic Exposure

We transact business in various foreign currencies and have significant international revenues, as well as costs denominated in foreign currencies. This exposes us to the risk of fluctuations in foreign currency exchange rates. Our objective is to identify material foreign currency exposures and to manage these exposures to minimize the potential effects of currency fluctuations on our condensed consolidated financial statements.

Transaction Exposure

Our exposure to foreign currency transaction gains and losses is the result of assets and liabilities (including inter-company transactions) that are denominated in currencies other than the relevant entity’s functional currency. In certain circumstances, changes in the functional currency value of these assets and liabilities create fluctuations in our condensed consolidated financial statements. We have performed sensitivity analyses as of March 31, 2023 and December 31, 2022 using a modeling technique that evaluated the hypothetical impact of a 10% movement in the value of the U.S. Dollar compared to the functional currency of the foreign subsidiary, with all other variables held constant, to determine the incremental transaction gains or losses that would have been incurred. The foreign exchange rates used were based on market rates in effect at each of March 31, 2023 and December 31, 2022. The results of these sensitivity analyses indicated that the impact on a hypothetical 10% movement in foreign currency exchange rates would result in increased foreign currency gains or losses of $1.3 million as of March 31, 2023 and $1.1 million as of December 31, 2022.

Translation Exposure

We are also exposed to foreign exchange rate fluctuations as we convert the financial statements of our foreign subsidiaries into U.S. Dollars in consolidation. If there is a change in foreign currency exchange rates, the conversion of the foreign subsidiaries’ financial statements into U.S. Dollars results in a gain or loss which is recorded as a component of accumulated other comprehensive income (loss) in our condensed consolidated statements of stockholders’ equity.

With respect to our international operations, we have re-measured accounts which are denominated in the non-functional currencies into the functional currency of the subsidiary and recorded the resulting gains (losses) within foreign currency gains (losses), net in our condensed consolidated statements of comprehensive loss. We re-measure all monetary assets and liabilities at the current exchange rate at the end of the period, non-monetary assets and liabilities at historical exchange rates, and revenue and expenses at average exchange rates in effect during the periods.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, or Exchange Act, that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Our disclosure controls and procedures have been designed to meet reasonable assurance standards. Additionally, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Based on their evaluation as of the end of the period covered by this Quarterly Report on Form 10-Q, our Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

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Changes in Internal Controls over Financial Reporting

We have made no changes to our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during the three months ended March 31, 2023, that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

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PART II: OTHER INFORMATION

Item 1. Legal Proceedings

We are and from time to time, may become subject to various legal proceedings and claims arising in the ordinary course of business or could be named a defendant in other lawsuits. Legal proceedings could result in material costs, occupy significant management resources and entail penalties, even if we prevail. The outcome of such claims or other proceedings cannot be predicted with certainty and may have a material effect on our financial condition, results of operations or cash flows.

Item 1A. Risk Factors

Our business and results of operations are subject to numerous risks, uncertainties, and other factors that you should be aware of. You should carefully review and consider the information regarding certain factors that could materially affect our business, financial condition or future results set forth in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 under the heading “Risk Factors.” There have been no material changes from the risk factors disclosed in our 2022 Annual Report on Form 10-K. The risks, uncertainties and other factors described in the risk factors are not the only ones facing our company. Additional risks, uncertainties and other factors not presently known to us or that we currently deem immaterial may also impair our business operations. Any of the risks, uncertainties and other factors could have a materially adverse effect on our business, financial condition, results of operations, cash flows or product market share and could cause the trading price of our common stock to decline substantially.

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

During the three months ended March 31, 2023, we repurchased 24,812 shares of our common stock. The table below sets forth information regarding the Company’s purchases of its common stock during the three months ended March 31, 2023:

	Issuer Purchases of Equity Securities
Period	Total number of shares purchased(1)		Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs		Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs
January 1, 2023 – January 31, 2023		13,388	$	7.38		—		—
February 1, 2023 – February 28, 2023		4,832		8.38		—		—
March 1, 2023 – March 31, 2023		6,592		6.79		—		—
Total		24,812	$	7.42		—
(1) Consists of shares surrendered to the Company to satisfy tax withholding obligations in connection with the vesting of restricted stock units issued to employees.

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Item 6. Exhibits

Exhibit Number	Description
10.1	Fourth Amendment to Amended and Restated Loan and Security Agreement between Identiv, Inc. and East West Bank dated as of February 8, 2023 (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 8, 2023).
31.1^	Certification of Chief Executive Officer pursuant to Section 302 of the Securities Exchange Act of 1934.
31.2^	Certification of Chief Financial Officer pursuant to Section 302 of the Securities Exchange Act of 1934.
32#	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

# Furnished herewith and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act of 1933 or the Exchange Act, except to the extent that the registrant specifically incorporates them by reference.

^ Filed herewith.

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SIGNATURES

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

	IDENTIV, INC.
May 9, 2023	By:	/S/ Steven Humphreys
		Steven Humphreys
		Chief Executive Officer
		(Principal Executive Officer)
May 9, 2023	By:	/S/ Justin Scarpulla
		Justin Scarpulla
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

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EX-31

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Steven Humphreys, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Identiv, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 9, 2023	/s/ Steven Humphreys
	Steven Humphreys
	Chief Executive Officer
	(Principal Executive Officer)

EX-31

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Justin Scarpulla, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Identiv, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 9, 2023	/s/ Justin Scarpulla
	Justin Scarpulla
	Chief Financial Officer and Secretary
	(Principal Financial and Accounting Officer)

EX-32

Exhibit 32

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Steven Humphreys, the Chief Executive Officer of Identiv, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge: (1) the Quarterly Report of Identiv, Inc. on Form 10-Q for the quarterly period ended March 31, 2023 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (2) the information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Identiv, Inc.

Date: May 9, 2023	/s/ Steven Humphreys
	Steven Humphreys
	Chief Executive Officer
	(Principal Executive Officer)

I, Justin Scarpulla, the Chief Financial Officer of Identiv, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge: (1) the Quarterly Report of Identiv, Inc. on Form 10-Q for the quarterly period ended March 31, 2023 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (2) the information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Identiv, Inc.

Date: May 9, 2023	/s/ Justin Scarpulla
	Justin Scarpulla
	Chief Financial Officer and Secretary
	(Principal Financial and Accounting Officer)

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Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2023	May 02, 2023
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Trading Symbol	INVE
Entity Registrant Name	Identiv, Inc.
Entity Central Index Key	0001036044
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	000-29440
Entity Tax Identification Number	77-0444317
Entity Address, Address Line One	2201 Walnut Avenue
Entity Address, Address Line Two	Suite 100
Entity Address, City or Town	Fremont
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94538
City Area Code	949
Local Phone Number	250-8888
Entity Common Stock, Shares Outstanding		22,974,287
Security12b Title	Common Stock, $0.001 par value per share
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false

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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 20,804	$ 16,650
Restricted cash	363	487
Accounts receivable, net of allowances of $2,666 and $2,745 as of September 30, 2022 and December 31, 2021, respectively	21,136	24,826
Inventories	30,609	28,958
Prepaid expenses and other current assets	4,361	4,177
Total current assets	77,273	75,098
Property and equipment, net	7,595	6,719
Operating lease right-of-use assets	4,344	4,373
Intangible assets, net	4,999	5,265
Goodwill	10,192	10,190
Other assets	1,148	1,120
Total assets	105,551	102,765
Current liabilities:
Accounts payable	9,926	14,760
Financial liabilities, net of debt issuance costs	9,941
Operating lease liabilities	1,199	1,190
Deferred revenue	1,798	2,068
Accrued compensation and related benefits	2,395	2,757
Other accrued expenses and liabilities	2,648	2,618
Total current liabilities	27,907	23,393
Long-term operating lease liabilities	3,371	3,366
Long-term deferred revenue	647	587
Other long-term liabilities	25	25
Total liabilities	31,950	27,371
Commitments and contingencies (see Note 15)
Stockholders' equity:
Preferred stock, $0.001 par value: 10,000 shares authorized; 5,000 shares issued and outstanding as of March 31, 2023 and December 31, 2022	5	5
Common stock, $0.001 par value: 50,000 shares authorized; 24,246 and 24,168 sharesissued and 22,677 and 22,623 shares outstanding as of March 31, 2023 and December 31, 2022, respectively	24	24
Additional paid-in capital	496,808	495,818
Treasury stock, 1,569 and 1,545 shares as of March 31, 2023 and December 31, 2022,respectively	(12,357)	(12,173)
Accumulated deficit	(412,100)	(409,381)
Accumulated other comprehensive income	1,221	1,101
Total stockholders' equity	73,601	75,394
Total liabilities and stockholders' equity	$ 105,551	$ 102,765

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Statement Of Financial Position [Abstract]
Accounts receivable, allowances	$ 2,675	$ 2,666
Debt instrument debt issuance costs, current	$ 59
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, issued	5,000,000	5,000,000
Preferred stock, outstanding	5,000,000	5,000,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	24,246,000	24,168,000
Common stock, shares outstanding	22,677,000	22,623,000
Treasury stock, shares	1,569,000	1,545,000

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Statement [Abstract]
Net revenue	$ 25,997	$ 25,061
Cost of revenue	16,786	16,095
Gross profit	9,211	8,966
Operating expenses:
Research and development	2,707	2,529
Selling and marketing	6,097	5,110
General and administrative	2,948	2,488
Restructuring and severance	191	(140)
Total operating expenses	11,943	9,987
Income (loss) from operations	(2,732)	(1,021)
Non-operating income (expense):
Interest expense, net	(50)	(25)
Gain on investment		24
Foreign currency gains, net	89	19
Loss before income tax benefit (provision)	(2,693)	(1,003)
Income tax benefit (provision)	(26)	4
Net income (loss)	(2,719)	(999)
Other comprehensive income (loss):
Foreign currency translation adjustment	120	(175)
Comprehensive income (loss)	$ (2,599)	$ (1,174)
Net income (loss) per common share:
Basic	$ (0.13)	$ (0.06)
Diluted	$ (0.13)	$ (0.06)
Weighted average shares used in computing net income (loss) per common share:
Basic	22,794	22,574
Diluted	22,794	22,574

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Preferred Stock Series B Convertible Preferred Stock	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated Deficit	Accumulated Other Comprehensive Income
Beginning Balances at Dec. 31, 2021	$ 74,512	$ 5	$ 24	$ 492,657	$ (11,134)	$ (408,989)	$ 1,949
Beginning Balances (in shares) at Dec. 31, 2021		5,000,000	22,230,000
Net income (loss)	(999)					(999)
Unrealized income (loss) from foreign currency translation adjustments	$ (175)						(175)
Issuance of common stock in connection with vesting of stock awards (shares)	88,000
Stock-based compensation	$ 895			895
Shares withheld in payment of taxes in connection with net share settlement of restricted stock units	(399)				(399)
Shares withheld in payment of taxes in connection with net share settlement of restricted stock units (shares)			(18,000)
Ending Balances at Mar. 31, 2022	73,834	$ 5	$ 24	493,552	(11,533)	(409,988)	1,774
Ending Balances (in shares) at Mar. 31, 2022		5,000,000	22,300,000
Beginning Balances at Dec. 31, 2022	75,394	$ 5	$ 24	495,818	(12,173)	(409,381)	1,101
Beginning Balances (in shares) at Dec. 31, 2022		5,000,000	22,623,000
Net income (loss)	(2,719)					(2,719)
Unrealized income (loss) from foreign currency translation adjustments	120						120
Issuance of common stock in connection with vesting of stock awards (shares)			78,000
Stock-based compensation	990			990
Shares withheld in payment of taxes in connection with net share settlement of restricted stock units	(184)				184
Shares withheld in payment of taxes in connection with net share settlement of restricted stock units (shares)			(24,000)
Ending Balances at Mar. 31, 2023	$ 73,601	$ 5	$ 24	$ 496,808	$ (12,357)	$ (412,100)	$ 1,221
Ending Balances (in shares) at Mar. 31, 2023		5,000,000	22,677,000

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows used in operating activities
Net loss	$ (2,719)	$ (999)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	623	509
Gain on investment		(24)
Amortization of debt issuance costs	5
Stock-based compensation	990	895
Changes in operating assets and liabilities:
Accounts receivable	3,661	501
Inventories	(1,667)	(541)
Prepaid expenses and other assets	(214)	417
Accounts payable	(4,876)	816
Deferred revenue	(210)	(649)
Accrued expenses and other liabilities	(291)	(959)
Net cash provided by (used in) operating activities	(4,698)	(34)
Cash flows from investing activities:
Capital expenditures	(1,225)	(510)
Proceeds from investment		24
Net cash used in investing activities	(1,225)	(486)
Cash flows from financing activities:
Borrowings under revolving loan facility, net of issuance costs	9,936
Taxes paid related to net share settlement of restricted stock units	(184)	(399)
Net cash provided by (used in) financing activities	9,752	(399)
Effect of exchange rates on cash, cash equivalents, and restricted cash	201	(200)
Net increase (decrease) in cash, cash equivalents, and restricted cash	4,030	(1,119)
Cash, cash equivalents, and restricted cash at beginning of period	17,137	29,807
Cash, cash equivalents, and restricted cash at end of period	21,167	28,688
Supplemental Disclosures of Cash Flow Information:
Interest paid	28	3
Taxes paid, net	27	$ 32
Non-cash investing and financing activities:
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$ 323

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Basis of Presentation

3 Months Ended

Mar. 31, 2023

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Basis of Presentation

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of Identiv, Inc. and its wholly owned subsidiaries (the “Company”). All intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications have been made to the fiscal year 2022 condensed consolidated financial statements to conform to the fiscal year 2023 presentation. The reclassifications had no impact on net loss, total assets, total liabilities, or stockholders’ equity.

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the Company’s unaudited condensed consolidated financial statements have been included. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023 or any future period. The unaudited condensed consolidated balance sheet as of December 31, 2022 has been derived from audited consolidated financial statements at that date, but does not include all disclosures required by U.S. GAAP for complete financial statements. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Risk Factors,” and the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

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Significant Accounting Policies and Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2023

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Significant Accounting Policies and Recent Accounting Pronouncements

2. Significant Accounting Policies and Recent Accounting Pronouncements

Significant Accounting Policies

No material changes have been made to the Company's significant accounting policies disclosed in Note 2, Significant Accounting Policies and Recent Accounting Pronouncements, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. The Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on its financial position or results of operations upon adoption.

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Revenue

3 Months Ended

Mar. 31, 2023

Revenue From Contract With Customer [Abstract]

Revenue

3. Revenue

Revenue Recognition

Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. The Company enters into contracts that can include various combinations of its products, software licenses, and services, which are generally capable of being distinct and accounted for as separate performance obligations. For contracts with multiple performance obligations, the Company allocates the transaction price of the contract to each performance obligation, generally on a relative basis using its standalone selling price. The stated contract value is generally the transaction price to be allocated to the separate performance obligations. Revenue is recognized net of any taxes collected from customers that are subsequently remitted to governmental authorities.

Nature of Products and Services

The Company derives revenues from sales of hardware products, software licenses, subscriptions, professional services, software maintenance and support, and extended hardware warranties.

Hardware Product Revenue — The Company generally has two performance obligations in arrangements involving the sale of hardware products. The first performance obligation is to transfer the hardware product (which includes software integral to the functionality of the hardware product). The second performance obligation is to provide assurance that the product complies with its agreed-upon specifications and is free from defects in material and workmanship for a period of one to three years (i.e., assurance warranty). The entire transaction price is allocated to the hardware product and is generally recognized as revenue at the time of shipment because the customer obtains control of the product at that point in time. The Company has concluded that control generally transfers at that point in time because the customer has title to the hardware, and a present obligation to pay for the hardware. None of the transaction price is allocated to the assurance warranty component, as the Company accounts for these product warranty costs in accordance with Accounting Standards Codification (“ASC”) 460, Guarantees (“ASC 460”).

Software License Revenue — The Company’s license arrangements grant customers the perpetual right to access and use the licensed software products at the outset of an arrangement. Technical support and software updates are generally made available throughout the term of the support agreement, which is generally one to three years. The Company accounts for these arrangements as two performance obligations: (1) the software licenses, and (2) the related updates and technical support. The software license revenue is recognized when the license is delivered to the customer or made available for download, while the software updates and technical support revenue is recognized over the term of the support contract.

Subscription Revenue — Subscription revenues consist of fees received in consideration for providing customers access to one or more of the Company’s software-as-a-service (“SaaS”) based solutions. These SaaS arrangements include access to the Company’s licensed software and, in certain arrangements, use of various hardware devices over the contract term. These SaaS arrangements do not provide the customer the right to take possession of the software supporting the subscription service, or if applicable, any hardware devices at any time during the contract period, and as such are not considered separate performance obligations. Revenue is recognized ratably on a straight-line basis over the term of the contract beginning when the service is made available to the customer. Subscription contract terms range from month-to-month to six years in length and are billed monthly or annually.

Professional Services Revenue — Professional services revenue consists primarily of programming customization services performed relating to the integration of the Company’s software products with the customers other systems, such as human resources systems. Professional services contracts are generally billed on a time and materials basis and revenue is recognized as the services are performed.

Software Maintenance and Support Revenue — Support and maintenance contract revenue consists of the services provided to support the specialized programming applications performed by the Company’s professional services group. Support and maintenance contracts are typically billed at inception of the contract and recognized as revenue over the contract period, typically over a one-or three-year period.

Extended Hardware Warranties Revenue — Sales of the Company’s hardware products may also include optional extended hardware warranties, which typically provide assurance that the product will continue to function as initially intended. Extended hardware warranty contracts are typically billed at inception of the contract and recognized as revenue over the respective contract period, typically over one-to-two-year periods after the expiration of the original assurance warranty.

Performance Obligation	When Performance Obligation is Typically Satisfied	When Payment is Typically Due	How Standalone Selling Price is Typically Estimated
Hardware products	When customer obtains control of the product (point-in-time)	Within 30-60 days of shipment	Observable in transactions without multiple performance obligations
Software licenses	When license is delivered to customer or made available for download, and the applicable license period has begun (point-in-time)	Within 30-60 days of the beginning of license period	Established pricing practices for software licenses bundled with software maintenance, which are separately observable in renewal transactions
Subscriptions	Ratably over the course of the subscription term (over time)	In advance of subscription term	Contractually stated or list price
Professional services	As services are performed and/or when contract is fulfilled (point-in-time)	Within 30-60 days of delivery	Observable in transactions without multiple performance obligations
Software maintenance and support services	Ratably over the course of the support contract (over time)	Within 30-60 days of the beginning of the contract period	Observable in renewal transactions
Extended hardware warranties	Ratably over the course of the support contract (over time)	Within 30-60 days of the beginning of the contract period	Observable in renewal transactions

Significant Judgments

The Company’s contracts with customers often include promises to transfer multiple products and services to a customer. For such arrangements, the Company allocates the transaction price to each performance obligation based on its relative standalone selling price (“SSP”).

Judgment is required to determine the SSP for each distinct performance obligation in a contract. For the majority of items, the Company estimates SSP using historical transaction data. The Company uses a range of amounts to estimate SSP when it sells each of the products and services separately and needs to determine whether there is a discount to be allocated based on the relative SSP of the various products and services. In instances where SSP is not directly observable, such as when the product or service is not sold separately, the Company determines the SSP using information that may include market conditions and other observable inputs. The determination of SSP is an ongoing process and information is reviewed regularly in order to ensure SSPs reflect current information or trends.

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers based on the timing of transfer of goods or services to customers (point-in-time or over time) and geographic region based on the shipping location of the customer. The geographic regions that are tracked are the Americas, Europe and the Middle East, and Asia-Pacific regions.

Total net revenue based on the disaggregation criteria described above is as follows (in thousands):

	Three Months Ended March 31,
	2023						2022
	Point-in- Time		Over Time		Total		Point-in- Time		Over Time		Total
Americas	$	20,874	$	754	$	21,628	$	15,898	$	993	$	16,891
Europe and the Middle East		2,899		85		2,984		3,669		125		3,794
Asia-Pacific		1,385		—		1,385		4,376		—		4,376
Total	$	25,158	$	839	$	25,997	$	23,943	$	1,118	$	25,061

Contract Balances

Amounts invoiced in advance of services being provided are accounted for as deferred revenue. Nearly all of the Company’s deferred revenue balance is related to software maintenance contracts. Payment terms and conditions vary by contract type, although payment is typically due within 30 to 60 days of contract inception. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined its contracts do not include a significant financing component. The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company’s products and services, not to receive financing from its customers.

Changes in deferred revenue during the three months ended March 31, 2023 and 2022 were as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Deferred revenue, beginning of period	$	2,655		$	2,433
Deferral of revenue billed in current period, net of recognition		504			381
Recognition of revenue deferred in prior periods		(714	)		(1,030	)
Deferred revenue, end of period	$	2,445		$	1,784

Amounts recognized as revenue in excess of amounts billed are recorded as unbilled receivables and are included in other current assets on the condensed consolidated balances sheets. As of March 31, 2023 and December 31, 2022, the amount of unbilled receivables was immaterial.

Unsatisfied Performance Obligations

Revenue expected to be recognized in future periods related to remaining performance obligations, excluding revenue pertaining to contracts that have an original expected duration of one year or less, and contracts where revenue is recognized as invoiced, was approximately $1.1 million as of March 31, 2023. Since the Company typically invoices customers at contract inception, this amount is included in the deferred revenue balance. As of March 31, 2023, the Company expects to recognize 38% of the revenue related to these unsatisfied performance obligations during the remainder of 2023, 31% during 2024, and 31% thereafter.

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Fair Value Measurements

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

4. Fair Value Measurements

The Company determines the fair values of its financial instruments based on a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The classification of a financial asset or liability within the hierarchy is based upon the lowest level input that is significant to the fair value measurement. Under ASC 820, Fair Value Measurement and Disclosures, the fair value hierarchy prioritizes the inputs into three levels that may be used to measure fair value:

•Level 1 – Quoted prices (unadjusted) for identical assets and liabilities in active markets;

•Level 2 – Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly; and

•Level 3 – Unobservable inputs.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

As of March 31, 2023 and December 31, 2022, the only assets measured and recognized at fair value on a recurring basis were nominal cash equivalents. As of March 31, 2023 and December 31, 2022, there were no liabilities measured and recognized at fair value on a recurring basis.

Assets and Liabilities Measured at Fair Value on a Non-recurring Basis

Certain of the Company's assets, including goodwill, intangible assets, and privately-held investments, are measured at fair value on a nonrecurring basis if impairment is indicated. Purchased intangible assets are measured at fair value primarily using discounted cash flow projections. For additional discussion of measurement criteria used in evaluating potential impairment involving goodwill and intangible assets, refer to Note 5, Goodwill and Intangible Assets.

As of March 31, 2023 and December 31, 2022, the Company had $348,000 of privately-held investments measured at fair value on a nonrecurring basis, which were classified as Level 3 assets due to the absence of quoted market prices and inherent lack of liquidity. The Company reviews its investments to identify and evaluate investments that have an indication of possible impairment. The Company adjusts the carrying value for its privately-held investments for any impairment if the fair value is less than the carrying value of the respective assets on an other-than-temporary basis. The amount of privately-held investments is included in other assets in the accompanying condensed consolidated balance sheets.

As of March 31, 2023 and December 31, 2022, there were no liabilities that are measured and recognized at fair value on a non-recurring basis.

Assets and Liabilities Not Measured at Fair Value

The carrying amounts of the Company's accounts receivable, prepaid expenses and other current assets, accounts payable, and other accrued liabilities approximate fair value due to their short maturities. The carrying value of the Company's financial liabilities approximates fair value based upon borrowing rates currently available to the Company for loans with similar terms.

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Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2023

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

5. Goodwill and Intangible Assets

Goodwill

The following table summarizes the activity in goodwill (in thousands):

	Identity		Premises		Total
Balance as of January 1, 2022	$	3,554	$	6,714	$	10,268
Currency translation adjustment		—		20		20
Balance as of March 31, 2022	$	3,554	$	6,734	$	10,288
Balance as of January 1, 2023	$	3,554	$	6,636	$	10,190
Currency translation adjustment		—		2		2
Balance as of March 31, 2023	$	3,554	$	6,638	$	10,192

In accordance with ASC 350, Intangibles – Goodwill and Other, the Company tests goodwill for impairment on an annual basis, in the fourth quarter, or whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. The Company performs an initial assessment of qualitative factors to determine whether the existence of events and circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. In performing the qualitative assessment, the Company identifies and considers the significance of relevant key factors, events, and circumstances that affect the fair value of its reporting units. These factors include external factors such as macroeconomic, industry, and market conditions, as well as entity-specific factors, such as actual and planned financial performance. If, after assessing the totality of relevant events and circumstances, the Company determines that it is more likely than not that the fair value of the reporting unit exceeds its carrying value and there is no indication of impairment, no further testing is performed; however, if the Company concludes otherwise, then the Company will perform the quantitative impairment test which compares the estimated fair value of the reporting unit to its carrying value, including goodwill. If the carrying amount of the reporting unit is in excess of its fair value, an impairment loss would be recorded in the condensed consolidated statements of comprehensive loss. During the three months ended March 31, 2023 and 2022, the Company noted no indicators of goodwill impairment and concluded no further testing was necessary.

Intangible Assets

The following table summarizes the gross carrying amount and accumulated amortization for intangible assets resulting from acquisitions (in thousands):

				Developed			Customer
	Trademarks			Technology			Relationships			Total
Amortization period (in years)	5			10 – 12			4 – 12
Gross carrying amount as of March 31, 2023	$	765		$	9,093		$	15,744		$	25,602
Accumulated amortization		(719	)		(6,777	)		(13,107	)		(20,603	)
Intangible assets, net as of March 31, 2023	$	46		$	2,316		$	2,637		$	4,999
Gross carrying amount as of December 31, 2022	$	766		$	9,093		$	15,743		$	25,602
Accumulated amortization		(691	)		(6,666	)		(12,980	)		(20,337	)
Intangible assets, net as of December 31, 2022	$	75		$	2,427		$	2,763		$	5,265

Each period, the Company evaluates the estimated remaining useful lives of purchased intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. If a revision to the remaining period of amortization is warranted, amortization is prospectively adjusted over the remaining useful life of the intangible asset. Intangible assets subject to amortization are amortized on a straight-line basis over their useful lives as indicated in the table above. The Company performs an evaluation of its amortizable intangible assets for impairment at the end of each reporting period. The Company did not identify any impairment indicators during the three months ended March 31, 2023.

The following table summarizes the amortization expense included in the condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Cost of revenue	$	111	$	112
Selling and marketing		155		168
Total	$	266	$	280

The estimated annual future amortization expense for purchased intangible assets with definite lives as of March 31, 2023 was as follows (in thousands):

2023 (remaining nine months)	$	773
2024		956
2025		956
2026		956
2027		956
Thereafter		402
Total	$	4,999

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Balance Sheet Components

3 Months Ended

Mar. 31, 2023

Statement Of Financial Position [Abstract]

Balance Sheet Components

6. Balance Sheet Components

The Company’s inventories are stated at the lower of cost or net realizable value. Inventories consists of (in thousands):

	March 31, 2023		December 31, 2022
Raw materials	$	14,489	$	13,333
Work-in-progress		—		55
Finished goods		16,120		15,570
Total	$	30,609	$	28,958

Property and equipment, net consists of (in thousands):

	March 31, 2023			December 31, 2022
Building and leasehold improvements	$	2,742		$	1,941
Furniture, fixtures and office equipment		890			726
Plant and machinery		15,586			15,311
Purchased software		732			718
Total		19,950			18,696
Accumulated depreciation		(12,355	)		(11,977	)
Property and equipment, net	$	7,595		$	6,719

The Company recorded depreciation expenses of $0.4 million and $0.2 million during the three months ended March 31, 2023 and 2022, respectively.

Other accrued expenses and liabilities consist of (in thousands):

	March 31, 2023		December 31, 2022
Accrued professional fees	$	485	$	574
Accrued warranties		341		345
Other accrued expenses		1,822		1,699
Total	$	2,648	$	2,618

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Financial Liabilities

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Financial Liabilities

7. Financial Liabilities

The Company’s financial liabilities consist of (in thousands):

	March 31,			December 31,
	2023			2022
Revolving loan facility	$	10,000		$	—
Less: Unamortized debt issuance costs		(59	)		—
Financial liabilities, net of debt issuance costs	$	9,941		$	—

On February 8, 2017, the Company entered into a Loan and Security Agreement (as amended or amended and restated from time to time, the “Loan Agreement”) with East West Bank (“EWB”). Following subsequent amendments, on April 14, 2022, the Company and EWB amended the Loan Agreement replacing the $20.0 million revolving loan facility subject to a borrowing base with a non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023. In addition, the interest rate was lowered from prime to prime minus 0.25% (interest rate as of March 31, 2023 was 7.75%), and certain financial covenants were amended. On February 8, 2023, the Company entered into an amendment (the "Fourth Amendment") to the Loan Agreement. The Fourth Amendment amends the Loan Agreement to, among other things, extend the maturity date to February 8, 2025, and amend certain financial covenants.

The Loan Agreement contains customary representations and warranties and customary affirmative and negative covenants, including, limits or restrictions on the Company’s ability to incur liens, incur indebtedness, make certain restricted payments (including dividends), merge or consolidate and dispose of assets, as well as other financial covenants. The Company’s obligations under the Loan Agreement are collateralized by substantially all of its assets. As of March 31, 2023, there was $10.0 million outstanding and the Company was in compliance with all financial covenants under the Loan Agreement. On May 4, 2023, the Company repaid $7.0 million of the amounts outstanding under the revolving loan facility.

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Income Taxes

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

8. Income Taxes

The Company conducts business globally and, as a result, files federal, state and foreign tax returns. The Company strives to resolve open matters with each tax authority at the examination level and could reach agreement with a tax authority at any time. While the Company has accrued for amounts it believes are the probable outcomes, the final outcome with a tax authority may result in a tax liability that is more or less than that reflected in the condensed consolidated financial statements. Furthermore, the Company may later decide to challenge any assessments, if made, and may exercise its right to appeal.

The Company applies the provisions of, and accounted for uncertain tax positions, in accordance with ASC 740, Income Taxes (“ASC 740”), which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. It prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.

The Company generally is no longer subject to tax examinations for years prior to 2017. However, if loss carryforwards of tax years prior to 2017 are utilized in the U.S., these tax years may become subject to investigation by the tax authorities. While timing of the resolution and/or finalization of tax audits is uncertain, the Company does not believe that its unrecognized tax benefits would materially change in the next 12 months.

On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 (the “Act”) into law. The $1.9 trillion Act includes COVID-19 relief, as well as broader stimulus, but also includes several revenue-raising and business tax provisions. The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) also includes several significant provisions for corporations, including the usage of net operating losses and payroll benefits. Several foreign (non-U.S.) jurisdictions in which the Company operates have taken similar economic stimulus measures. The Act and the CARES Act had no material impact on the Company’s condensed consolidated financial statements and disclosures.

The Inflation Reduction Act (the “IRA”) was signed into the law on August 16, 2022. The IRA provides for a minimum tax on certain corporations having more than $1 billion in revenue, excise taxes on share buybacks and changes to various types of tax credits. The Company believes the IRA will have little to no effect on the Company’s income taxes. The Company will continue to assess as the provisions are clarified.

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Stockholders' Equity

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Stockholders' Equity

9. Stockholders’ Equity

Series B Convertible Preferred Stock Dividend Accretion

The following table summarizes Series B convertible preferred stock and the accretion of dividend activity for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Series B Convertible Preferred Stock:
Balance at beginning of period	$	25,323	$	24,117
Cumulative dividends on Series B convertible preferred stock		313		298
Balance at end of period	$	25,636	$	24,415
Number of Common Shares Issuable Upon Conversion:
Number of shares at beginning of period		6,331		6,029
Cumulative dividends on Series B convertible preferred stock		78		75
Number of shares at end of period		6,409		6,104

Based on the current conversion price, the outstanding shares, including the accretion of dividends, of Series B convertible preferred stock as of March 31, 2023 would be convertible into 6,409,010 shares of the Company’s common stock. However, the conversion rate will be subject to adjustment in certain instances, such as if the Company issues shares of its common stock at a price less than $4.00 per common share, subject to a minimum conversion price of $3.27 per share. As of March 31, 2023, none of the contingent conditions to adjust the conversion rate had been met.

Each share of Series B convertible preferred stock is entitled to a cumulative annual dividend of 5% for the first six years following the issuance of such share and 3% for each year thereafter, with the Company retaining the option to settle each year’s dividend after the 10th year in cash. The dividends accrue and are payable in kind upon such time as the shares convert into the Company’s common stock. In general, the shares are not entitled to vote except in certain limited cases, including in change of control transactions where the expected price per share distributable to the Company’s stockholders is expected to be less than $4.00 per share. The Certificate of Designation with respect to the Series B convertible preferred stock further provides that in the event of, among other things, any change of control, liquidation or dissolution of the Company, the holders of the Series B convertible preferred stock will be entitled to receive, on a pari passu basis with the holders of the common stock, the same amount and form of consideration that the holders of the Company’s common stock receive (on an as-if-converted-to-common-stock basis and without regard to the Beneficial Ownership Limitation (as defined in the Certificate of Designation) applicable to the Series B convertible preferred stock).

Common Stock Warrants

On May 5, 2020, the Company entered into a Note and Warrant Purchase Agreement with 21 April Fund, LP and 21 April Fund, Ltd., (collectively, the “April 21 Funds”), pursuant to which the Company issued warrants (“April 21 Funds Warrants”) to purchase 275,000 shares of common stock of the Company. The April 21 Funds Warrants have a term of three years (subject to early termination upon the closing of an acquisition). The shares of common stock issuable upon exercise of the April 21 Fund Warrants are entitled to resale registration rights pursuant to a Stockholders Agreement dated December 21, 2017.

Below is the summary of outstanding warrants as of March 31, 2023:

Warrant Type	Number of Shares Issuable Upon Exercise		Weighted Average Exercise Price		Issue Date	Expiration Date
April 21 Funds Warrants		275,000	$	3.50	May 5, 2020	May 5, 2023

On April 24, 2023, April 21 Funds exercised their warrants, receiving 275,000 shares of the Company's common stock which resulted in the Company receiving $962,500 in cash proceeds.

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance as of March 31, 2023 was as follows:

Exercise of outstanding stock options, vesting of restricted stock units ("RSUs"), vesting of      performance stock units ("PSUs"), and issuance of RSUs vested but not released	1,556,124
Employee Stock Purchase Plan	293,888
Shares of common stock available for grant under the 2011 Plan	416,955
Warrants to purchase common stock	275,000
Shares of common stock issuable upon conversion of Series B convertible preferred stock	7,541,449
Total	10,083,416

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Stock-Based Compensation

3 Months Ended

Mar. 31, 2023

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

10. Stock-Based Compensation

Stock Incentive Plan

The Company maintains a stock-based compensation plan, the 2011 Incentive Compensation Plan (the “2011 Plan”), as amended, to attract, motivate, retain and reward employees, directors and consultants by providing its Board or a committee of the Board the discretion to award equity incentives to these persons.

Stock Options

A summary of stock option activity for the three months ended March 31, 2023 is as follows:

	Number Outstanding		Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Balance as of January 1, 2023		505,593	$	5.05		3.17	$	1,280,805
Granted		—		—
Cancelled or Expired		—		—
Exercised		—		—
Balance as of March 31, 2023		505,593	$	5.05		2.93	$	791,309
Vested or expected to vest as of March 31, 2023		505,593	$	5.05		2.93	$	791,309
Exercisable as of March 31, 2023		505,593	$	5.05		2.93	$	791,309

The aggregate intrinsic value in the table above represents the difference between the fair value of the Company’s common stock as of March 31, 2023 and the exercise price of in-the-money stock options multiplied by the number of such stock options.

The following table summarizes information about stock options outstanding as of March 31, 2023:

	Stock Options Outstanding						Stock Options Exercisable
Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$4.36 - $7.20		445,960		3.18	$	4.37		445,960	$	4.37
$7.50 - $11.25		59,100		1.05		10.17		59,100		10.17
$11.30 - $16.95		500		1.00		11.30		500		11.30
$19.70 - $29.55		33		0.38		19.70		33		19.70
$4.36 - $29.55		505,593		2.93	$	5.05		505,593	$	5.05

As of March 31, 2023, there was no unrecognized stock-based compensation expense related to stock options.

Restricted Stock Units

The following is a summary of RSU activity for the three months ended March 31, 2023:

	Number Outstanding			Weighted Average Fair Value
Unvested as of January 1, 2023		819,185		$	13.23
Granted		151,123			6.96
Vested		(84,816	)		13.35
Forfeited		(12,729	)		12.62
Unvested as of March 31, 2023		872,763		$	12.14
RSUs vested but not released		137,768		$	7.00

The fair value of the Company’s RSUs is calculated based upon the fair market value of the Company’s common stock at the date of grant. As of March 31, 2023, there was $8.6 million of unrecognized compensation expense related to unvested RSUs granted, which is expected to be recognized over a weighted average period of 3.1 years. No tax benefit was realized from RSUs for the three months ended March 31, 2023.

Performance Stock Units

The Company grants PSUs to certain key employees that are subject to the attainment of performance goals established by the Company’s Compensation Committee, the periods during which performance is to be measured, and other limitations and conditions. Performance goals are based on pre-established objectives that specify the manner of determining the number of PSUs that will vest if performance goals are attained. If an employee terminates employment, the non-vested portion of the PSUs will not vest and all rights to the non-vested portion will terminate.

The following is a summary of PSU activity for the three months ended March 31, 2023:

	Number Outstanding		Weighted Average Fair Value
Unvested as of January 1, 2023		40,000	$	8.51
Granted		—		—
Vested		—		—
Forfeited		—		—
Unvested as of March 31, 2023		40,000	$	8.51

As of March 31, 2023, there was $0.2 million of unrecognized compensation expense related to unvested PSUs, which is expected to be recognized over a period of 0.75 years. No tax benefit was realized from PSUs for the three months ended March 31, 2023.

Stock-Based Compensation Expense

The following table summarizes stock-based compensation expense related to stock options, RSUs, and PSUs included in the condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Cost of revenue	$	45	$	56
Research and development		202		310
Selling and marketing		293		194
General and administrative		450		335
Total	$	990	$	895

Restricted Stock Unit Net Share Settlements

During the three months ended March 31, 2023 and 2022, the Company repurchased 24,812 and 17,647 shares, respectively, of common stock surrendered to the Company to satisfy tax withholding obligations in connection with the vesting of RSUs issued to employees.

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Net Loss per Common Share

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Net Loss per Common Share

11. Net Loss per Common Share

Basic net loss per common share is computed by dividing net loss available to common stockholders during the period by the weighted average number of common shares outstanding during that period. Diluted net loss per common share is impacted by equity instruments considered to be potential common shares, if dilutive, computed using the treasury stock or the if-converted method of accounting. Dilutive potential common share equivalents are excluded from the computation of net income (loss) per share in loss periods, as their effect would be antidilutive.

	Three Months Ended March 31,
	2023			2022
Basic net loss per common share:
Numerator:
Net loss	$	(2,719	)	$	(999	)
Less: accretion of Series B convertible preferred stock dividends		(313	)		(298	)
Net loss available to common stockholders	$	(3,032	)	$	(1,297	)
Denominator:
Weighted average common shares outstanding - basic		22,794			22,574
Net loss per common share - basic	$	(0.13	)	$	(0.06	)

The following common stock equivalents have been excluded from diluted net loss per share for the three months ended March 31, 2023 and 2022 because their inclusion would have been anti-dilutive (in thousands):

	Three Months Ended March 31,
	2023		2022
Shares of common stock subject to outstanding RSUs		873		557
Shares of common stock subject to outstanding PSUs		40		75
Shares of common stock subject to outstanding stock options		506		514
Shares of common stock subject to outstanding warrants		275		275
Shares of common stock issuable upon conversion of Series B    convertible preferred stock		6,409		6,104
Total		8,103		7,525

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Segment Reporting, Geographic Information, and Concentration of Credit Risk

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Segment Reporting, Geographic Information, and Concentration of Credit Risk

2. Segment Reporting, Geographic Information, and Concentration of Credit Risk

Segment Reporting

ASC 280, Segment Reporting establishes standards for the reporting by public business enterprises of information about operating segments, products and services, geographic areas, and major customers. The method for determining what information to report is based on the way management organizes the operating segments within the Company for making operating decisions and assessing financial performance. An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenue and incur expenses and about which separate financial information is available to its chief operating decision makers (“CODM”). The Company’s CODM is its Chief Executive Officer.

The CODM reviews financial information and business performance for each operating segment. The Company evaluates the performance of its operating segments at the revenue and gross profit levels. The Company does not report total assets, capital expenditures or operating expenses by operating segment as such information is not used by the CODM for purposes of assessing performance or allocating resources.

Net revenue and gross profit information by segment for the three months ended March 31, 2023 and 2022 are as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Identity:
Net revenue	$	14,678		$	14,579
Gross profit		3,079			3,159
Gross profit margin		21	%		22	%
Premises:
Net revenue		11,319			10,482
Gross profit		6,132			5,807
Gross profit margin		54	%		55	%
Total:
Net revenue		25,997			25,061
Gross profit		9,211			8,966
Gross profit margin		35	%		36	%
Operating expenses:
Research and development		2,707			2,529
Selling and marketing		6,097			5,110
General and administrative		2,948			2,488
Restructuring and severance		191			(140	)
Total operating expenses:		11,943			9,987
Loss from operations		(2,732	)		(1,021	)
Non-operating income (expense):
Interest expense, net		(50	)		(25	)
Gain on investment		—			24
Foreign currency gains, net		89			19
Loss before income tax benefit (provision)	$	(2,693	)	$	(1,003	)

Geographic Information

Geographic net revenue is based on the customer’s ship-to location. Information regarding net revenue by geographic region for the three months ended March 31, 2023 and 2022 is as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Americas	$	21,628		$	16,891
Europe and the Middle East		2,984			3,794
Asia-Pacific		1,385			4,376
Total	$	25,997		$	25,061
As percentage of net revenue:
Americas		83	%		67	%
Europe and the Middle East		12	%		15	%
Asia-Pacific		5	%		18	%
Total		100	%		100	%

Concentration of Credit Risk

One customer accounted for 11% of net revenue for the three months ended March 31, 2023. No customer accounted for more than 10% of net revenue for the three months ended March 31, 2022. No customer accounted for 10% or more of net accounts receivable as of March 31, 2023 or December 31, 2022.

Long-lived assets by geographic location as of March 31, 2023 and December 31, 2022 are as follows (in thousands):

	March 31, 2023		December 31, 2022
Property and equipment, net:
Americas	$	706	$	530
Europe and the Middle East		490		458
Asia-Pacific		6,399		5,731
Total property and equipment, net	$	7,595	$	6,719
Operating lease ROU assets:
Americas	$	3,440	$	3,637
Europe and the Middle East		350		384
Asia-Pacific		554		352
Total operating lease right-of-use assets	$	4,344	$	4,373

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Restructuring and Severance

3 Months Ended

Mar. 31, 2023

Restructuring And Related Activities [Abstract]

Restructuring and Severance

13. Restructuring and Severance

During the three months ended March 31, 2023, restructuring expenses consisted of severance related costs of $191,000. During the three months ended March 31, 2022, the Company entered into a settlement agreement associated with outstanding rental payments due the landlord on leased office space in San Francisco, California. As a result of the settlement, the Company recorded a net credit of $153,000 representing the difference between amounts accrued and the settlement amount. The settlement credit was partially offset by severance related costs of $13,000.

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Leases

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Leases

4. Leases

The Company’s leases consist primarily of operating leases for administrative office space, research and development facilities, a manufacturing facility, and sales offices in various countries around the world. The Company determines if an arrangement is a lease at inception. Some lease agreements contain lease and non-lease components, which are accounted for as a single lease component. Total rent expense was $0.4 million and $0.3 million for the three months ended March 31, 2023 and 2022, respectively.

Initial lease terms are determined at commencement and may include options to extend or terminate the lease when it is reasonably certain the Company will exercise the option. Remaining lease terms range from one to five years, some of which include options to extend for up to five years. Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets. As the Company’s leases do not provide an implicit rate, the present value of future lease payments is determined using the Company’s incremental borrowing rate based on information available at the lease commencement date.

The table below reconciles the undiscounted cash flows for the first five years and the total of the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of March 31, 2023 (in thousands):

	March 31, 2023
2023 (remaining nine months)	$	1,063
2024		1,285
2025		1,051
2026		836
2027		798
Thereafter		13
Total minimum lease payments		5,046
Less: amount of lease payments representing interest		(476	)
Present value of future minimum lease payments		4,570
Less: current liabilities under operating leases		(1,199	)
Long-term operating lease liabilities	$	3,371

As of March 31, 2023, the weighted average remaining lease term for the Company’s operating leases was 3.0 years, and the weighted average discount rate used to determine the present value of the Company’s operating leases was 6.3%.

Cash paid for amounts included in the measurement of operating lease liabilities was $0.4 million and $0.3 million for the three months ended March 31, 2023 and 2022, respectively.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2023

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

15. Commitments and Contingencies

The following table summarizes the Company’s principal contractual commitments, excluding operating leases, as of March 31, 2023 (in thousands):

	Purchase Commitments		Other Contractual Commitments		Total
2023 (remaining nine months)	$	50,158	$	67	$	50,225
2024		7,744		—		7,744
2025		4,005		—		4,005
Total	$	61,907	$	67	$	61,974

Purchase commitments for inventories are highly dependent upon forecasts of customer demand. Due to the uncertainty in demand from its customers, the Company may have to change, reschedule, or cancel purchases or purchase orders from its suppliers. These changes may lead to vendor cancellation charges on these purchases or contractual commitments.

The following table summarizes the Company’s warranty accrual account activity during the three months ended March 31, 2023 and 2022:

	Three Months Ended March 31,
	2023			2022
Balance at beginning of period	$	345		$	377
Charged (credited) to costs and expenses		(5	)		14
Cost of warranty claims		1			1
Balance at end of period	$	341		$	392

The Company provides warranties on certain product sales for periods ranging from 12 to 36 months, and allowances for estimated warranty costs are recorded during the period of sale. The determination of such allowances requires the Company to make estimates of product return rates and expected costs to repair or to replace the products under warranty. The Company currently establishes warranty reserves based on historical warranty costs for each product line combined with liability estimates based on the prior 12 months’ sales activities. If actual return rates and/or repair and replacement costs differ significantly from the Company’s estimates, adjustments to recognize additional cost of sales may be required in future periods. Historically, the warranty accrual and the expense amounts have been immaterial.

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Subsequent Events

3 Months Ended

Mar. 31, 2023

Subsequent Events [Abstract]

Subsequent Events

16. Subsequent Events

There were no subsequent events except as disclosed within Note 7, Financial Liabilities and Note 9, Stockholders' Equity.

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Significant Accounting Policies and Recent Accounting Pronouncements (Policies)

3 Months Ended

Mar. 31, 2023

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. The Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on its financial position or results of operations upon adoption.

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Revenue (Tables)

3 Months Ended

Mar. 31, 2023

Revenue From Contract With Customer [Abstract]

Total Net Revenue Based on Disaggregation Criteria

Total net revenue based on the disaggregation criteria described above is as follows (in thousands):

	Three Months Ended March 31,
	2023						2022
	Point-in- Time		Over Time		Total		Point-in- Time		Over Time		Total
Americas	$	20,874	$	754	$	21,628	$	15,898	$	993	$	16,891
Europe and the Middle East		2,899		85		2,984		3,669		125		3,794
Asia-Pacific		1,385		—		1,385		4,376		—		4,376
Total	$	25,158	$	839	$	25,997	$	23,943	$	1,118	$	25,061

Changes in Deferred Revenue

Changes in deferred revenue during the three months ended March 31, 2023 and 2022 were as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Deferred revenue, beginning of period	$	2,655		$	2,433
Deferral of revenue billed in current period, net of recognition		504			381
Recognition of revenue deferred in prior periods		(714	)		(1,030	)
Deferred revenue, end of period	$	2,445		$	1,784

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Goodwill and Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2023

Goodwill And Intangible Assets Disclosure [Abstract]

Summary of Activity in Goodwill

The following table summarizes the activity in goodwill (in thousands):

	Identity		Premises		Total
Balance as of January 1, 2022	$	3,554	$	6,714	$	10,268
Currency translation adjustment		—		20		20
Balance as of March 31, 2022	$	3,554	$	6,734	$	10,288
Balance as of January 1, 2023	$	3,554	$	6,636	$	10,190
Currency translation adjustment		—		2		2
Balance as of March 31, 2023	$	3,554	$	6,638	$	10,192

Summary of Gross Carrying Amount and Accumulated Amortization for Intangible Assets Resulting from Acquisitions

The following table summarizes the gross carrying amount and accumulated amortization for intangible assets resulting from acquisitions (in thousands):

				Developed			Customer
	Trademarks			Technology			Relationships			Total
Amortization period (in years)	5			10 – 12			4 – 12
Gross carrying amount as of March 31, 2023	$	765		$	9,093		$	15,744		$	25,602
Accumulated amortization		(719	)		(6,777	)		(13,107	)		(20,603	)
Intangible assets, net as of March 31, 2023	$	46		$	2,316		$	2,637		$	4,999
Gross carrying amount as of December 31, 2022	$	766		$	9,093		$	15,743		$	25,602
Accumulated amortization		(691	)		(6,666	)		(12,980	)		(20,337	)
Intangible assets, net as of December 31, 2022	$	75		$	2,427		$	2,763		$	5,265

Amortization Expense Included in Condensed Consolidated Statements of Operations

The following table summarizes the amortization expense included in the condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Cost of revenue	$	111	$	112
Selling and marketing		155		168
Total	$	266	$	280

Estimated Future Amortization Expense of Purchased Intangible Assets with Definite Lives

The estimated annual future amortization expense for purchased intangible assets with definite lives as of March 31, 2023 was as follows (in thousands):

2023 (remaining nine months)	$	773
2024		956
2025		956
2026		956
2027		956
Thereafter		402
Total	$	4,999

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Balance Sheet Components (Tables)

3 Months Ended

Mar. 31, 2023

Statement Of Financial Position [Abstract]

Inventories

The Company’s inventories are stated at the lower of cost or net realizable value. Inventories consists of (in thousands):

	March 31, 2023		December 31, 2022
Raw materials	$	14,489	$	13,333
Work-in-progress		—		55
Finished goods		16,120		15,570
Total	$	30,609	$	28,958

Property and Equipment, Net

Property and equipment, net consists of (in thousands):

	March 31, 2023			December 31, 2022
Building and leasehold improvements	$	2,742		$	1,941
Furniture, fixtures and office equipment		890			726
Plant and machinery		15,586			15,311
Purchased software		732			718
Total		19,950			18,696
Accumulated depreciation		(12,355	)		(11,977	)
Property and equipment, net	$	7,595		$	6,719

Other Accrued Expenses and Liabilities

Other accrued expenses and liabilities consist of (in thousands):

	March 31, 2023		December 31, 2022
Accrued professional fees	$	485	$	574
Accrued warranties		341		345
Other accrued expenses		1,822		1,699
Total	$	2,648	$	2,618

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Financial Liabilities (Tables)

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Summary of Financial Liabilities

The Company’s financial liabilities consist of (in thousands):

	March 31,			December 31,
	2023			2022
Revolving loan facility	$	10,000		$	—
Less: Unamortized debt issuance costs		(59	)		—
Financial liabilities, net of debt issuance costs	$	9,941		$	—

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Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Summary of Series B Preferred Stock and Accretion of Dividends

The following table summarizes Series B convertible preferred stock and the accretion of dividend activity for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Series B Convertible Preferred Stock:
Balance at beginning of period	$	25,323	$	24,117
Cumulative dividends on Series B convertible preferred stock		313		298
Balance at end of period	$	25,636	$	24,415
Number of Common Shares Issuable Upon Conversion:
Number of shares at beginning of period		6,331		6,029
Cumulative dividends on Series B convertible preferred stock		78		75
Number of shares at end of period		6,409		6,104

Summary of Outstanding Warrants

Below is the summary of outstanding warrants as of March 31, 2023:

Warrant Type	Number of Shares Issuable Upon Exercise		Weighted Average Exercise Price		Issue Date	Expiration Date
April 21 Funds Warrants		275,000	$	3.50	May 5, 2020	May 5, 2023

Summary of Common Stock Reserved for Future Issuance

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance as of March 31, 2023 was as follows:

Exercise of outstanding stock options, vesting of restricted stock units ("RSUs"), vesting of      performance stock units ("PSUs"), and issuance of RSUs vested but not released	1,556,124
Employee Stock Purchase Plan	293,888
Shares of common stock available for grant under the 2011 Plan	416,955
Warrants to purchase common stock	275,000
Shares of common stock issuable upon conversion of Series B convertible preferred stock	7,541,449
Total	10,083,416

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Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2023

Share Based Compensation Arrangement By Share Based Payment Award [Line Items]

Summary of Activity for Stock Option Plans

A summary of stock option activity for the three months ended March 31, 2023 is as follows:

	Number Outstanding		Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Balance as of January 1, 2023		505,593	$	5.05		3.17	$	1,280,805
Granted		—		—
Cancelled or Expired		—		—
Exercised		—		—
Balance as of March 31, 2023		505,593	$	5.05		2.93	$	791,309
Vested or expected to vest as of March 31, 2023		505,593	$	5.05		2.93	$	791,309
Exercisable as of March 31, 2023		505,593	$	5.05		2.93	$	791,309

Summary Information about Options Outstanding

The following table summarizes information about stock options outstanding as of March 31, 2023:

	Stock Options Outstanding						Stock Options Exercisable
Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$4.36 - $7.20		445,960		3.18	$	4.37		445,960	$	4.37
$7.50 - $11.25		59,100		1.05		10.17		59,100		10.17
$11.30 - $16.95		500		1.00		11.30		500		11.30
$19.70 - $29.55		33		0.38		19.70		33		19.70
$4.36 - $29.55		505,593		2.93	$	5.05		505,593	$	5.05

Summary of Stock Unit Activity

The following is a summary of RSU activity for the three months ended March 31, 2023:

	Number Outstanding			Weighted Average Fair Value
Unvested as of January 1, 2023		819,185		$	13.23
Granted		151,123			6.96
Vested		(84,816	)		13.35
Forfeited		(12,729	)		12.62
Unvested as of March 31, 2023		872,763		$	12.14
RSUs vested but not released		137,768		$	7.00

Stock-Based Compensation Expense Related to Stock Options, RSUs and PSUs

The following table summarizes stock-based compensation expense related to stock options, RSUs, and PSUs included in the condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Cost of revenue	$	45	$	56
Research and development		202		310
Selling and marketing		293		194
General and administrative		450		335
Total	$	990	$	895

Performance Stock Units

Share Based Compensation Arrangement By Share Based Payment Award [Line Items]

Summary of Stock Unit Activity

The following is a summary of PSU activity for the three months ended March 31, 2023:

	Number Outstanding		Weighted Average Fair Value
Unvested as of January 1, 2023		40,000	$	8.51
Granted		—		—
Vested		—		—
Forfeited		—		—
Unvested as of March 31, 2023		40,000	$	8.51

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Net Loss per Common Share (Tables)

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Calculations for Basic Net Loss Per Common Share

Basic net loss per common share is computed by dividing net loss available to common stockholders during the period by the weighted average number of common shares outstanding during that period. Diluted net loss per common share is impacted by equity instruments considered to be potential common shares, if dilutive, computed using the treasury stock or the if-converted method of accounting. Dilutive potential common share equivalents are excluded from the computation of net income (loss) per share in loss periods, as their effect would be antidilutive.

	Three Months Ended March 31,
	2023			2022
Basic net loss per common share:
Numerator:
Net loss	$	(2,719	)	$	(999	)
Less: accretion of Series B convertible preferred stock dividends		(313	)		(298	)
Net loss available to common stockholders	$	(3,032	)	$	(1,297	)
Denominator:
Weighted average common shares outstanding - basic		22,794			22,574
Net loss per common share - basic	$	(0.13	)	$	(0.06	)

Common Stock Equivalents Excluded From Diluted Net Loss Per Share

The following common stock equivalents have been excluded from diluted net loss per share for the three months ended March 31, 2023 and 2022 because their inclusion would have been anti-dilutive (in thousands):

	Three Months Ended March 31,
	2023		2022
Shares of common stock subject to outstanding RSUs		873		557
Shares of common stock subject to outstanding PSUs		40		75
Shares of common stock subject to outstanding stock options		506		514
Shares of common stock subject to outstanding warrants		275		275
Shares of common stock issuable upon conversion of Series B    convertible preferred stock		6,409		6,104
Total		8,103		7,525

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Segment Reporting, Geographic Information, and Concentration of Credit Risk (Tables)

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Information Regarding Net Revenue and Gross Profit by Segment

Net revenue and gross profit information by segment for the three months ended March 31, 2023 and 2022 are as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Identity:
Net revenue	$	14,678		$	14,579
Gross profit		3,079			3,159
Gross profit margin		21	%		22	%
Premises:
Net revenue		11,319			10,482
Gross profit		6,132			5,807
Gross profit margin		54	%		55	%
Total:
Net revenue		25,997			25,061
Gross profit		9,211			8,966
Gross profit margin		35	%		36	%
Operating expenses:
Research and development		2,707			2,529
Selling and marketing		6,097			5,110
General and administrative		2,948			2,488
Restructuring and severance		191			(140	)
Total operating expenses:		11,943			9,987
Loss from operations		(2,732	)		(1,021	)
Non-operating income (expense):
Interest expense, net		(50	)		(25	)
Gain on investment		—			24
Foreign currency gains, net		89			19
Loss before income tax benefit (provision)	$	(2,693	)	$	(1,003	)

Information Regarding Net Revenue by Geographic Region

Geographic Information

Geographic net revenue is based on the customer’s ship-to location. Information regarding net revenue by geographic region for the three months ended March 31, 2023 and 2022 is as follows (in thousands):

	Three Months Ended March 31,
	2023			2022
Americas	$	21,628		$	16,891
Europe and the Middle East		2,984			3,794
Asia-Pacific		1,385			4,376
Total	$	25,997		$	25,061
As percentage of net revenue:
Americas		83	%		67	%
Europe and the Middle East		12	%		15	%
Asia-Pacific		5	%		18	%
Total		100	%		100	%

Long-Lived Assets by Geographic Location

Long-lived assets by geographic location as of March 31, 2023 and December 31, 2022 are as follows (in thousands):

	March 31, 2023		December 31, 2022
Property and equipment, net:
Americas	$	706	$	530
Europe and the Middle East		490		458
Asia-Pacific		6,399		5,731
Total property and equipment, net	$	7,595	$	6,719
Operating lease ROU assets:
Americas	$	3,440	$	3,637
Europe and the Middle East		350		384
Asia-Pacific		554		352
Total operating lease right-of-use assets	$	4,344	$	4,373

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Leases (Tables)

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Schedule of Reconciles Undiscounted Cash flows of Operating Lease Liabilities Recorded on the Condensed Consolidated Balance Sheet

The table below reconciles the undiscounted cash flows for the first five years and the total of the remaining years to the operating lease liabilities recorded on the condensed consolidated balance sheet as of March 31, 2023 (in thousands):

	March 31, 2023
2023 (remaining nine months)	$	1,063
2024		1,285
2025		1,051
2026		836
2027		798
Thereafter		13
Total minimum lease payments		5,046
Less: amount of lease payments representing interest		(476	)
Present value of future minimum lease payments		4,570
Less: current liabilities under operating leases		(1,199	)
Long-term operating lease liabilities	$	3,371

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Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2023

Commitments And Contingencies Disclosure [Abstract]

Summary of Principal Contractual Obligations, Excluding Operating Leases

The following table summarizes the Company’s principal contractual commitments, excluding operating leases, as of March 31, 2023 (in thousands):

	Purchase Commitments		Other Contractual Commitments		Total
2023 (remaining nine months)	$	50,158	$	67	$	50,225
2024		7,744		—		7,744
2025		4,005		—		4,005
Total	$	61,907	$	67	$	61,974

Summary of Warranty Accrual Account Activity

The following table summarizes the Company’s warranty accrual account activity during the three months ended March 31, 2023 and 2022:

	Three Months Ended March 31,
	2023			2022
Balance at beginning of period	$	345		$	377
Charged (credited) to costs and expenses		(5	)		14
Cost of warranty claims		1			1
Balance at end of period	$	341		$	392

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Revenue - Additional Information (Detail) $ in Millions	3 Months Ended
	Mar. 31, 2023 USD ($)
Revenue From Contract With Customer [Line Items]
Remaining performance obligations	$ 1.1
Minimum
Revenue From Contract With Customer [Line Items]
Payment period from contract inception	30 days
Maximum
Revenue From Contract With Customer [Line Items]
Payment period from contract inception	60 days
Software Licenses | Minimum
Revenue From Contract With Customer [Line Items]
Contract period	1 year
Software Licenses | Maximum
Revenue From Contract With Customer [Line Items]
Contract period	3 years
Subscriptions | Minimum
Revenue From Contract With Customer [Line Items]
Contract period	1 month
Subscriptions | Maximum
Revenue From Contract With Customer [Line Items]
Contract period	6 years
Software Maintenance and Support Services | Minimum
Revenue From Contract With Customer [Line Items]
Contract period	1 year
Software Maintenance and Support Services | Maximum
Revenue From Contract With Customer [Line Items]
Contract period	3 years
Extended Hardware Warranties | Minimum
Revenue From Contract With Customer [Line Items]
Contract period	1 year
Extended Hardware Warranties | Maximum
Revenue From Contract With Customer [Line Items]
Contract period	2 years

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Schedule of Performance Obligation (Detail)	3 Months Ended
	Mar. 31, 2023
Hardware Products
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Performance Obligation	Hardware products
When Performance Obligation is Typically Satisfied	When customer obtains control of the product (point-in-time)
When Payment is Typically Due	Within 30-60 days of shipment
How Standalone Selling Price is Typically Estimated	Observable in transactions without multiple performance obligations
Software Licenses
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Performance Obligation	Software licenses
When Performance Obligation is Typically Satisfied	When license is delivered to customer or made available for download, and the applicable license period has begun (point-in-time)
When Payment is Typically Due	Within 30-60 days of the beginning of license period
How Standalone Selling Price is Typically Estimated	Established pricing practices for software licenses bundled with software maintenance, which are separately observable in renewal transactions
Subscriptions
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Performance Obligation	Subscriptions
When Performance Obligation is Typically Satisfied	Ratably over the course of the subscription term (over time)
When Payment is Typically Due	In advance of subscription term
How Standalone Selling Price is Typically Estimated	Contractually stated or list price
Professional Services
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Performance Obligation	Professional services
When Performance Obligation is Typically Satisfied	As services are performed and/or when contract is fulfilled (point-in-time)
When Payment is Typically Due	Within 30-60 days of delivery
How Standalone Selling Price is Typically Estimated	Observable in transactions without multiple performance obligations
Software Maintenance and Support Services
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Performance Obligation	Software maintenance and support services
When Performance Obligation is Typically Satisfied	Ratably over the course of the support contract (over time)
When Payment is Typically Due	Within 30-60 days of the beginning of the contract period
How Standalone Selling Price is Typically Estimated	Observable in renewal transactions
Extended Hardware Warranties
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Performance Obligation	Extended hardware warranties
When Performance Obligation is Typically Satisfied	Ratably over the course of the support contract (over time)
When Payment is Typically Due	Within 30-60 days of the beginning of the contract period
How Standalone Selling Price is Typically Estimated	Observable in renewal transactions

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Schedule of Performance Obligation (Parenthetical) (Detail)	3 Months Ended
	Mar. 31, 2023
Hardware Products | Minimum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	30 days
Hardware Products | Maximum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	60 days
Software Licenses | Minimum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	30 days
Software Licenses | Maximum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	60 days
Professional Services | Minimum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	30 days
Professional Services | Maximum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	60 days
Software Maintenance and Support Services | Minimum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	30 days
Software Maintenance and Support Services | Maximum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	60 days
Extended Hardware Warranties | Minimum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	30 days
Extended Hardware Warranties | Maximum
Revenue Recognition Multiple Deliverable Arrangements [Line Items]
Payment period, after shipment	60 days

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Total Net Revenue Based on Disaggregation Criteria (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Disaggregation Of Revenue [Line Items]
Total net revenue	$ 25,997	$ 25,061
Point-in-Time
Disaggregation Of Revenue [Line Items]
Total net revenue	25,158	23,943
Over Time
Disaggregation Of Revenue [Line Items]
Total net revenue	839	1,118
Americas
Disaggregation Of Revenue [Line Items]
Total net revenue	21,628	16,891
Americas | Point-in-Time
Disaggregation Of Revenue [Line Items]
Total net revenue	20,874	15,898
Americas | Over Time
Disaggregation Of Revenue [Line Items]
Total net revenue	754	993
Europe and the Middle East
Disaggregation Of Revenue [Line Items]
Total net revenue	2,984	3,794
Europe and the Middle East | Point-in-Time
Disaggregation Of Revenue [Line Items]
Total net revenue	2,899	3,669
Europe and the Middle East | Over Time
Disaggregation Of Revenue [Line Items]
Total net revenue	85	125
Asia-Pacific
Disaggregation Of Revenue [Line Items]
Total net revenue	1,385	4,376
Asia-Pacific | Point-in-Time
Disaggregation Of Revenue [Line Items]
Total net revenue	$ 1,385	$ 4,376

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Changes in Deferred Revenue (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenue From Contract With Customer [Abstract]
Deferred revenue	$ 2,655	$ 2,433
Deferral of revenue billed in current period, net of recognition	504	381
Recognition of revenue deferred in prior periods	(714)	(1,030)
Deferred revenue	$ 2,445	$ 1,784

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Revenue - Unsatisfied Performance Obligation - Additional Information (Detail)	Mar. 31, 2023
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-04-01
Revenue From Contract With Customer [Line Items]
Unsatisfied performance obligations, expected to recognize	38.00%
Unsatisfied performance obligations, expected to recognize, period	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2024-01-01
Revenue From Contract With Customer [Line Items]
Unsatisfied performance obligations, expected to recognize	31.00%
Unsatisfied performance obligations, expected to recognize, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2025-01-01
Revenue From Contract With Customer [Line Items]
Unsatisfied performance obligations, expected to recognize	31.00%

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Fair Value Measurements - Additional Information (Detail) - USD ($)	Mar. 31, 2023	Dec. 31, 2022
Fair Value Measurements, Recurring
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Liability measured and recognized at fair value	$ 0	$ 0
Fair Value Measurements, Non-recurring
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Liability measured and recognized at fair value	0	0
Fair Value Measurements, Non-recurring | Fair Value, Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Privately-held investments measured at fair value	$ 348,000	$ 348,000

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Summary of Activity in Goodwill (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Goodwill [Line Items]
Beginning Balance	$ 10,190	$ 10,268
Currency translation adjustment	2	20
Ending Balance	10,192	10,288
Identity
Goodwill [Line Items]
Beginning Balance	3,554	3,554
Ending Balance	3,554	3,554
Premises
Goodwill [Line Items]
Beginning Balance	6,636	6,714
Currency translation adjustment	2	20
Ending Balance	$ 6,638	$ 6,734

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Goodwill and Intangible Assets - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Goodwill And Intangible Assets Disclosure [Abstract]
Impairment of goodwill	$ 0	$ 0
Impairment of intangible assets	$ 0

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Summary of Gross Carrying Amount and Accumulated Amortization for Intangible Assets Resulting from Acquisitions (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Acquired Finite Lived Intangible Assets [Line Items]
Gross carrying amount	$ 25,602	$ 25,602
Accumulated amortization	(20,603)	(20,337)
Intangible assets, net	$ 4,999	5,265
Trademarks
Acquired Finite Lived Intangible Assets [Line Items]
Amortization period (in years)	5 years
Gross carrying amount	$ 765	766
Accumulated amortization	(719)	(691)
Intangible assets, net	46	75
Developed Technology
Acquired Finite Lived Intangible Assets [Line Items]
Gross carrying amount	9,093	9,093
Accumulated amortization	(6,777)	(6,666)
Intangible assets, net	$ 2,316	2,427
Developed Technology | Minimum
Acquired Finite Lived Intangible Assets [Line Items]
Amortization period (in years)	10 years
Developed Technology | Maximum
Acquired Finite Lived Intangible Assets [Line Items]
Amortization period (in years)	12 years
Customer Relationships
Acquired Finite Lived Intangible Assets [Line Items]
Gross carrying amount	$ 15,744	15,743
Accumulated amortization	(13,107)	(12,980)
Intangible assets, net	$ 2,637	$ 2,763
Customer Relationships | Minimum
Acquired Finite Lived Intangible Assets [Line Items]
Amortization period (in years)	4 years
Customer Relationships | Maximum
Acquired Finite Lived Intangible Assets [Line Items]
Amortization period (in years)	12 years

XML

Amortization Expense Included in Condensed Consolidated Statements of Operations (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Finite Lived Intangible Assets [Line Items]
Amortization expense	$ 266	$ 280
Cost of revenue
Finite Lived Intangible Assets [Line Items]
Amortization expense	111	112
Selling and Marketing Expense
Finite Lived Intangible Assets [Line Items]
Amortization expense	$ 155	$ 168

XML

Estimated Future Amortization Expense of Purchased Intangible Assets with Definite Lives (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Goodwill And Intangible Assets Disclosure [Abstract]
2023 (remaining nine months)	$ 773
2024	956
2025	956
2026	956
2027	956
Thereafter	402
Intangible assets, net	$ 4,999	$ 5,265

XML

Inventories (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Raw materials	$ 14,489	$ 13,333
Work-in-progress		55
Finished goods	16,120	15,570
Total	$ 30,609	$ 28,958

XML

Property and Equipment, Net (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 19,950	$ 18,696
Accumulated depreciation	(12,355)	(11,977)
Property and equipment, net	7,595	6,719
Building and Leasehold Improvements
Property Plant And Equipment [Line Items]
Property and equipment, gross	2,742	1,941
Furniture, Fixtures and Office Equipment
Property Plant And Equipment [Line Items]
Property and equipment, gross	890	726
Plant and Machinery
Property Plant And Equipment [Line Items]
Property and equipment, gross	15,586	15,311
Purchased Software
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 732	$ 718

XML

Balance Sheet Components - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Property Plant And Equipment [Abstract]
Depreciation expenses	$ 0.4	$ 0.2

XML

Other Accrued Expenses and Liabilities (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Accrued Liabilities And Other Liabilities Current [Abstract]
Accrued professional fees	$ 485	$ 574
Accrued warranties	341	345
Other accrued expenses	1,822	1,699
Total	$ 2,648	$ 2,618

XML

Financial Liabilities - Summary of Financial Liabilities (Detail) $ in Thousands	Mar. 31, 2023 USD ($)
Debt Instrument [Line Items]
Less: Unamortized debt issuance costs	$ (59)
Financial liabilities, net of debt issuance costs	9,941
Revolving Loan Facility
Debt Instrument [Line Items]
Financial liabilities	$ 10,000

XML

Financial Liabilities - Additional Information (Detail) - Revolving Loan Facility - USD ($) $ in Millions				3 Months Ended
	May 04, 2023	Feb. 08, 2023	Apr. 14, 2022	Mar. 31, 2023
Subsequent Event
Debt Instrument [Line Items]
Repayment of outstanding amounts	$ 7.0
Loan and Security Agreements
Debt Instrument [Line Items]
Outstanding borrowing capacity under credit facility				$ 10.0
Amended Loan Agreement
Debt Instrument [Line Items]
Interest rate				7.75%
Amended Loan Agreement | Prime Rate
Debt Instrument [Line Items]
Percentage of interest rate			0.25%
Amended Loan Agreement | East West Bank
Debt Instrument [Line Items]
Borrowing capacity under credit facility			$ 20.0
Loan facility payable date			Feb. 08, 2023
Fourth Amendment Loan Agreement | East West Bank
Debt Instrument [Line Items]
Loan facility payable date		Feb. 08, 2025

XML

Income Taxes - Additional Information (Detail) $ in Billions	3 Months Ended
	Mar. 31, 2023 USD ($)
Minimum
Income Taxes [Line Items]
Tax provide on corporations	$ 1

XML

Stockholders' Equity - Additional Information (Detail) - USD ($)		3 Months Ended
	Apr. 24, 2023	Mar. 31, 2023	May 05, 2020
Series B Convertible Preferred Stock
Stockholders Equity [Line Items]
Minimum conversion price		$ 3.27
Dividend payment terms		Each share of Series B convertible preferred stock is entitled to a cumulative annual dividend of 5% for the first six years following the issuance of such share and 3% for each year thereafter, with the Company retaining the option to settle each year’s dividend after the 10th year in cash. The dividends accrue and are payable in kind upon such time as the shares convert into the Company’s common stock
Cumulative annual dividend for first six years		5.00%
Cumulative annual dividend for each year after sixth year		3.00%
Price per share distributable to stockholders		$ 4.00
Series B Convertible Preferred Stock | Common Stock
Stockholders Equity [Line Items]
Preferred stock shares convertible into common stock		6,409,010
Maximum | Common Stock
Stockholders Equity [Line Items]
Shares issued, price per share		$ 4.00
April 21 Funds Warrants
Stockholders Equity [Line Items]
Warrants issued to purchase common stock			275,000
Warrant exercise price		$ 3.50
Warrants outstanding term			3 years
Number of shares issuable upon exercise		275,000
April 21 Funds Warrants | Subsequent Event
Stockholders Equity [Line Items]
Number of shares issuable upon exercise	275,000
Cash proceeds reveived	$ 962,500

XML

Summary of Series B Convertible Preferred Stock and Accretion of Dividend (Detail) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Stockholders Equity [Line Items]
Dividends earned on Series B preferred stock	$ 313	$ 298
Series B Convertible Preferred Stock
Stockholders Equity [Line Items]
Balance at beginning of period	25,323	24,117
Dividends earned on Series B preferred stock	313	298
Balance at end of period	$ 25,636	$ 24,415
Number of shares at beginning of period	6,331	6,029
Cumulative dividends on Series B convertible preferred stock	78	75
Number of shares at end of period	6,409	6,104

XML

Summary of Outstanding Warrants (Detail) - April 21 Funds Warrants	3 Months Ended
	Mar. 31, 2023 $ / shares shares
Class Of Warrant Or Right [Line Items]
Number of Shares Issuable Upon Exercise | shares	275,000
Weighted Average Exercise Price | $ / shares	$ 3.50
Issue Date	May 05, 2020
Expiration Date	May 05, 2023

XML

Summary of Common Stock Reserved for Future Issuance (Detail)	Mar. 31, 2023 shares
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Common stock reserved for future issuance	10,083,416
Exercise of Outstanding Stock Options, Vesting of Restricted Stock Units ("RSU"), Vesting of Performance Stock Units ("PSU") and Issuance of RSUs Vested but not Released
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Common stock reserved for future issuance	1,556,124
Employee Stock Purchase Plan
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Common stock reserved for future issuance	293,888
Shares of Common Stock Available for Grant Under the 2011 Plan
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Common stock reserved for future issuance	416,955
Warrants to Purchase Common Stock
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Common stock reserved for future issuance	275,000
Shares of Common Stock Issuable Upon Conversion of Series B Convertible Preferred Stock
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Common stock reserved for future issuance	7,541,449

XML

Summary of Activity for Stock Options (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Stock Options Number Outstanding
Beginning Balance	505,593
Ending Balance	505,593	505,593
Vested or expected to vest as of March 31, 2023	505,593
Exercisable as of March 31, 2023	505,593
Stock Options Aggregate Intrinsic Value
Beginning Balance	$ 1,280,805
Ending Balance	791,309	$ 1,280,805
Vested or expected to vest as of March 31, 2023	791,309
Exercisable as of March 31, 2023	$ 791,309
Stock Options Remaining Contractual Life (in years)
Weighted Average Remaining Contractual Term (Years)	2 years 11 months 4 days	3 years 2 months 1 day
Vested or expected to vest as of March 31, 2023	2 years 11 months 4 days
Exercisable as of March 31, 2023	2 years 11 months 4 days
Stock Options Weighted Average Exercise Price per share
Beginning Balance	$ 5.05
Ending Balance	5.05	$ 5.05
Vested or expected to vest as of March 31, 2023	5.05
Exercisable as of March 31, 2023	$ 5.05

XML

Summary Information about Stock Options Outstanding (Detail)	3 Months Ended
	Mar. 31, 2023 $ / shares shares
$4.36 - $7.20
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	$ 4.36
Range of Exercise Prices, upper limit	$ 7.20
Stock Options Number Outstanding | shares	445,960
Stock Options Outstanding Weighted Average Remaining Contractual Life (Years)	3 years 2 months 4 days
Stock Options Outstanding Weighted Average Exercise Price	$ 4.37
Stock Options Number Exercisable | shares	445,960
Stock Options Exercisable Weighted Average Exercise Price	$ 4.37
$7.50 - $11.25
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	7.50
Range of Exercise Prices, upper limit	$ 11.25
Stock Options Number Outstanding | shares	59,100
Stock Options Outstanding Weighted Average Remaining Contractual Life (Years)	1 year 18 days
Stock Options Outstanding Weighted Average Exercise Price	$ 10.17
Stock Options Number Exercisable | shares	59,100
Stock Options Exercisable Weighted Average Exercise Price	$ 10.17
$11.30 - $16.95
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	11.30
Range of Exercise Prices, upper limit	$ 16.95
Stock Options Number Outstanding | shares	500
Stock Options Outstanding Weighted Average Remaining Contractual Life (Years)	1 year
Stock Options Outstanding Weighted Average Exercise Price	$ 11.30
Stock Options Number Exercisable | shares	500
Stock Options Exercisable Weighted Average Exercise Price	$ 11.30
$19.70 - $29.55
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	19.70
Range of Exercise Prices, upper limit	$ 29.55
Stock Options Number Outstanding | shares	33
Stock Options Outstanding Weighted Average Remaining Contractual Life (Years)	4 months 17 days
Stock Options Outstanding Weighted Average Exercise Price	$ 19.70
Stock Options Number Exercisable | shares	33
Stock Options Exercisable Weighted Average Exercise Price	$ 19.70
$4.36 - $29.55
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	4.36
Range of Exercise Prices, upper limit	$ 29.55
Stock Options Number Outstanding | shares	505,593
Stock Options Outstanding Weighted Average Remaining Contractual Life (Years)	2 years 11 months 4 days
Stock Options Outstanding Weighted Average Exercise Price	$ 5.05
Stock Options Number Exercisable | shares	505,593
Stock Options Exercisable Weighted Average Exercise Price	$ 5.05

XML

Stock-Based Compensation - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized compensation expense related to stock options			$ 0
Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized compensation expense	$ 8,600,000
Unrecognized stock-based compensation expense, weighted average period of recognition	3 years 1 month 6 days
Realized tax benefit	$ 0
Granted	151,123
Grant fair value	$ 6.96
Repurchase of common stock (in shares)	24,812	17,647
Performance Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized compensation expense	$ 200,000
Unrecognized stock-based compensation expense, weighted average period of recognition	9 months
Realized tax benefit	$ 0

XML

Summary of RSU Activity (Detail) - Restricted Stock Units	3 Months Ended
	Mar. 31, 2023 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Beginning Balance, Unvested, Number Outstanding | shares	819,185
Granted, Number Outstanding | shares	151,123
Vested, Number Outstanding | shares	(84,816)
Forfeited, Number Outstanding | shares	(12,729)
Ending Balance, Unvested, Number Outstanding | shares	872,763
RSUs vested but not released, Number Outstanding | shares	137,768
Beginning Balance, Unvested, Weighted Average Fair Value | $ / shares	$ 13.23
Granted, Weighted Average Fair Value | $ / shares	6.96
Vested, Weighted Average Fair Value | $ / shares	13.35
Forfeited, Weighted Average Fair Value | $ / shares	12.62
Ending Balance, Unvested, Weighted Average Fair Value | $ / shares	12.14
RSUs vested but not released, Weighted Average Fair Value | $ / shares	$ 7.00

XML

Summary of PSU Activity (Detail) - Performance Stock Units	3 Months Ended
	Mar. 31, 2023 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Beginning Balance, Unvested, Number Outstanding | shares	40,000
Ending Balance, Unvested, Number Outstanding | shares	40,000
Beginning Balance, Unvested, Weighted Average Fair Value | $ / shares	$ 8.51
Ending Balance, Unvested, Weighted Average Fair Value | $ / shares	$ 8.51

XML

Stock-Based Compensation Expense Related to Stock Options, RSUs and PSUs (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-Based Compensation Expense	$ (990)	$ (895)
Stock Options and Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-Based Compensation Expense	990	895
Stock Options and Restricted Stock Units | Cost of revenue
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-Based Compensation Expense	45	56
Stock Options and Restricted Stock Units | Research and Development Expense
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-Based Compensation Expense	202	310
Stock Options and Restricted Stock Units | Selling and Marketing Expense
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-Based Compensation Expense	293	194
Stock Options and Restricted Stock Units | General and Administrative Expense
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock-Based Compensation Expense	$ 450	$ 335

XML

Calculations for Basic Net Loss Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Numerator:
Net loss	$ (2,719)	$ (999)
Less: accretion of Series B convertible preferred stock dividends	(313)	(298)
Net loss available to common stockholders	$ (3,032)	$ (1,297)
Denominator:
Weighted average common shares outstanding - basic	22,794	22,574
Net loss per common share - basic	$ (0.13)	$ (0.06)

XML

Common Stock Equivalents Excluded From Diluted Net Loss Per Share (Detail) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents diluted net income (loss) per share inclusion anti-dilutive	8,103	7,525
Restricted Stock Units
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents diluted net income (loss) per share inclusion anti-dilutive	873	557
PSUs
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents diluted net income (loss) per share inclusion anti-dilutive	40	75
Stock Options
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents diluted net income (loss) per share inclusion anti-dilutive	506	514
Warrants
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents diluted net income (loss) per share inclusion anti-dilutive	275	275
Shares of Common Stock Issuable Upon Conversion of Series B Convertible Preferred Stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock equivalents diluted net income (loss) per share inclusion anti-dilutive	6,409	6,104

XML

Information Regarding Net Revenue and Gross Profit by Segment (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
Net revenue	$ 25,997	$ 25,061
Gross profit	$ 9,211	$ 8,966
Gross profit margin	35.00%	36.00%
Operating expenses:
Research and development	$ 2,707	$ 2,529
Selling and marketing	6,097	5,110
General and administrative	2,948	2,488
Restructuring and severance	191	(140)
Total operating expenses	11,943	9,987
Loss from operations	(2,732)	(1,021)
Non-operating income (expense):
Interest expense, net	(50)	(25)
Gain on investment		24
Foreign currency gains, net	89	19
Loss before income tax benefit (provision)	(2,693)	(1,003)
Identity
Segment Reporting Information [Line Items]
Net revenue	14,678	14,579
Gross profit	$ 3,079	$ 3,159
Gross profit margin	21.00%	22.00%
Premises
Segment Reporting Information [Line Items]
Net revenue	$ 11,319	$ 10,482
Gross profit	$ 6,132	$ 5,807
Gross profit margin	54.00%	55.00%

XML

Information Regarding Net Revenue by Geographic Region (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
Net revenue	$ 25,997	$ 25,061
Geographic Concentration Risk | Revenue from Contract with Customer
Segment Reporting Information [Line Items]
Percentage of net revenue	100.00%	100.00%
Americas
Segment Reporting Information [Line Items]
Net revenue	$ 21,628	$ 16,891
Americas | Geographic Concentration Risk | Revenue from Contract with Customer
Segment Reporting Information [Line Items]
Percentage of net revenue	83.00%	67.00%
Europe and the Middle East
Segment Reporting Information [Line Items]
Net revenue	$ 2,984	$ 3,794
Europe and the Middle East | Geographic Concentration Risk | Revenue from Contract with Customer
Segment Reporting Information [Line Items]
Percentage of net revenue	12.00%	15.00%
Asia-Pacific
Segment Reporting Information [Line Items]
Net revenue	$ 1,385	$ 4,376
Asia-Pacific | Geographic Concentration Risk | Revenue from Contract with Customer
Segment Reporting Information [Line Items]
Percentage of net revenue	5.00%	18.00%

XML

Segment Reporting, Geographic Information and Concentration of Credit Risk - Additional Information (Detail) - Customer	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Segment Reporting [Abstract]
Concentration Risk, Customer	One customer accounted for 11% of net revenue for the three months ended March 31, 2023. No customer accounted for more than 10% of net revenue for the three months ended March 31, 2022. No customer accounted for 10% or more of net accounts receivable as of March 31, 2023 or December 31, 2022.
Number of major customer represented stated percentage of total net revenue	1	0
Number of customers who accounted for 10% or more net accounts receivable	0		0

XML

Long-Lived Assets by Geographic Location (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Segment Reporting Information [Line Items]
Property and equipment, net	$ 7,595	$ 6,719
Operating lease ROU assets	4,344	4,373
Americas
Segment Reporting Information [Line Items]
Property and equipment, net	706	530
Operating lease ROU assets	3,440	3,637
Europe and the Middle East
Segment Reporting Information [Line Items]
Property and equipment, net	490	458
Operating lease ROU assets	350	384
Asia-Pacific
Segment Reporting Information [Line Items]
Property and equipment, net	6,399	5,731
Operating lease ROU assets	$ 554	$ 352

XML

Restructuring and Severance - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Restructuring Cost And Reserve [Line Items]
Net credit representing difference between amounts accrued and the settlement amount		$ 153,000
Restructuring and severance expenses	$ 191,000	(140,000)
Severance
Restructuring Cost And Reserve [Line Items]
Restructuring and severance expenses	$ 191,000
Severance
Restructuring Cost And Reserve [Line Items]
Restructuring and severance expenses		$ 13,000

XML

Leases - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Lessee Lease Description [Line Items]
Total rent expense	$ 0.4	$ 0.3
Lessee, Operating Lease, Existence of Option to Extend [true false]	true
Weighted average remaining operating lease term	3 years
Weighted average discount rate of operating lease	6.30%
Operating lease liabilities, cash paid	$ 0.4	$ 0.3
Minimum
Lessee Lease Description [Line Items]
Remaining lease term	1 year
Maximum
Lessee Lease Description [Line Items]
Remaining lease term	5 years
Operating leases, options to extend leases term	5 years

XML

Leases - Schedule of Reconciles Undiscounted Cash flows of Operating Lease Liabilities Recorded on the Condensed Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Leases [Abstract]
2023 (remaining nine months)	$ 1,063
2024	1,285
2025	1,051
2026	836
2027	798
Thereafter	13
Total minimum lease payments	5,046
Less: amount of lease payments representing interest	(476)
Present value of future minimum lease payments	4,570
Less: current liabilities under operating leases	(1,199)	$ (1,190)
Long-term operating lease liabilities	$ 3,371	$ 3,366

XML

Summary of Principal Contractual Obligations, Excluding Operating Leases (Detail) $ in Thousands	Mar. 31, 2023 USD ($)
Purchase Commitments
2023 (remaining nine months)	$ 50,158
2024	7,744
2025	4,005
Total	61,907
Other Contractual Commitments
2023 (remaining nine months)	67
Total	67
Total Commitments
2023 (remaining nine months)	50,225
2024	7,744
2025	4,005
Total	$ 61,974

XML

Summary of Warranty Accrual Account Activity (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Leases [Abstract]
Balance at beginning of period	$ 345	$ 377
Charged (credited) to costs and expenses	(5)	14
Cost of warranty claims	1	1
Balance at end of period	$ 341	$ 392

XML

Commitments and Contingencies - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2023
Minimum
Commitment And Contingencies [Line Items]
Term of warranties on certain product sales	12 months
Maximum
Commitment And Contingencies [Line Items]
Term of warranties on certain product sales	36 months