Note 6 - Property and Equipment, Net

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

6.    Property and Equipment, net

Property and equipment consist of the following:

	March 31, 2019			December 31, 2018
Land, building, and improvements	$	9,093		$	9,039
Machinery and equipment		5,892			5,745
Computer equipment		300			282
Office equipment, furnishings, and improvements		181			181
Total		15,466			15,247
Accumulated depreciation		(3,739	)		(3,480	)
Total property and equipment, net	$	11,727		$	11,767

Depreciation expense for the

three

months ended

March 31, 2019

and

2018

was

$258

and

$231,

respectively. For the

three

months ended

March 31, 2019

and

2018,

$23

and

$13

of depreciation expense, respectively, was included in cost of sales and

$235

and

$218

was included in selling, marketing, general, and administrative expenses, respectively.

The Company’s manufacturing activities and efforts have historically focused on the identification, design, and successful prototyping of customer applications, including, but

not

limited to, medical and automotive components. Experience has shown that customers will perform numerous tests and extensively evaluate components and products before incorporating them into their finished products. The time required for testing, evaluating, and designing the Company’s components and products for use in a customer’s products, and in some cases, obtaining regulatory approval, can be significant, with an additional period of time before a customer commences volume production of products incorporating Liquidmetal components and products, if ever. The time it takes to transition a customer from limited production to full-scale production runs will depend upon the nature of the processes and products into which Liquidmetal alloys are integrated.

Investments in the Company’s manufacturing capabilities and infrastructure have been historically made based on certain assumptions and expectations regarding the time and investment required to reach minimum volume manufacturing levels, to scale and generate sustainable revenues, and to ultimately reach profitability. As a result of the Company’s inability to gain traction in receiving and fulfilling orders for the volume production of parts, the Company has commenced a comprehensive review of the options available in the context of its current strategy. While

no

decisions have been made, any change to the current strategy, depending on its nature,

may

result in future impairments of the Company’s manufacturing assets, inclusive of patents and trademarks.