Balance Sheet Details

3 Months Ended

Mar. 31, 2023

Balance Sheet Related Disclosures [Abstract]

(5) Balance Sheet Details

Balance sheet detail as of March 31, 2023 and December 31, 2022 is as follows (in thousands):

Inventories


	March 31, 2023
	(As Restated)		December 31, 2022
Raw materials	$	35,870	$	37,354
Work in process	1,465		1,050
Finished goods	59,976		55,884
Total inventories	$	97,311	$	94,288

Inventories are stated at the lower of cost or net realizable value, with cost being computed based on an adjusted standard basis, which approximates actual cost on an average or first-in, first-out basis. Finished goods include deferred cost of revenue of $26.3 million and $16.4 million as of March 31, 2023 and December 31, 2022, respectively.

Provision for inventory write-down was $1.1 million and $0.7 million for the three months ended March 31, 2023 and March 31, 2022, respectively.

Property, plant and equipment


	March 31, 2023		December 31, 2022

Machinery and equipment	$	12,971	$	17,214
Leasehold improvements	2,440		5,683
Computers and software	4,608		4,713
Furniture and fixtures	2,108		1,748
Construction in progress and other	1,358		1,264
	23,485		30,622
Less: accumulated depreciation and amortization	(16,285)		(21,062)
Less: government grants	(65)		(82)
Total property, plant and equipment, net	$	7,135	$	9,478

Depreciation expense associated with property, plant and equipment for the three months ended March 31, 2023 and March 31, 2022 was $1.2 million and $0.8 million, respectively.

Warranties

The Company accrues warranty costs based on historical trends for the expected material and labor costs to provide warranty services. The Company's standard warranty period is one year from the date of shipment with the ability for customers to purchase an extended warranty of up to five years from the date of shipment. The following table summarizes the activity related to the product warranty liability:


	Three Months Ended March 31,
	2023		2022
Balance at beginning of period	$	1,896	$	1,981
Charged to cost of revenue	70		121
Claims and settlements	(113)		(149)
Foreign currency exchange impact	21		(17)
Balance at end of period	$	1,874	$	1,936

Contract Balances

The Company records contract assets when it has a right to consideration and records accounts receivable when it has an unconditional right to consideration. Contract liabilities consist of cash payments received (or unconditional rights to receive cash) in advance of fulfilling performance obligations. The majority of the Company's performance obligations in its contracts with customers relate to contracts with duration of less than one year.

The opening and closing balances of current and long-term contract assets and contract liabilities related to contracts with customers are as follows:


	Contract assets		Contract liabilities
December 31, 2022	$	576	$	26,493
March 31, 2023 (As Restated)	$	605	$	23,198

The decrease in contract liabilities during the three months ended March 31, 2023 was primarily due to the revenue recognition criteria being met for previously deferred revenue, partially offset by invoiced amounts that did not yet meet the revenue recognition criteria. The amount of revenue recognized in the three months ended March 31, 2023 that was included in the prior period contract liability balance was $8.5 million. The amount of revenue recognized in the three months ended March 31, 2022 that was included in the prior period contract liability balance was $2.4 million. This revenue consists of services provided to customers who had been invoiced prior to the current year. We expect to recognize approximately 72% of outstanding contract liabilities as revenue over the next 12 months and the remainder thereafter.

The balance of contract cost deferred as of March 31, 2023 and December 31, 2022 was $0.5 million and $1.0 million, respectively. During the three months ended March 31, 2023, the Company recorded $0.5 million in amortization related to contract cost deferred as of December 31, 2022. During the three months ended March 31, 2022, the Company recorded $0.2 million in amortization related to contract cost deferred as of December 31, 2021.