Balance Sheet Components

12 Months Ended

Dec. 31, 2022

Balance Sheet Components

Balance Sheet Components

4. Balance Sheet Components

Inventory

Inventory consisted of the following (in thousands):

	December 31,
	2022		2021
Raw materials	$	666	$	464
Work-in-process		4,746		4,620
Finished goods		1,271		1,312
Total inventory	$	6,683	$	6,396

Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):

	December 31,
	2022		2021
Manufacturing equipment	$	16,130	$	12,608
Computer and network equipment		1,124		1,008
Furniture and fixtures		187		187
Software		929		929
Leasehold improvements		1,444		1,444
Total property and equipment, gross		19,814		16,176
Less: accumulated depreciation		(15,931)		(15,203)
Total property and equipment, net	$	3,883	$	973

Depreciation and amortization expense during the years ended December 31, 2022 and 2021 was $1.0 million and $1.5 million, respectively.

Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

	December 31,
	2022		2021
Payroll-related expenses	$	2,886	$	2,845
Inventory		185		177
Other		462		557
Total accrued liabilities	$	3,533	$	3,579

Deferred Revenue

During the year ended December 31, 2021, the Company executed contractual arrangements with a customer for the development of a RAD-Hard product, consisting of a technology license, design license agreement and development subcontract (RAD-Hard 1). The Company does not share in the rights to future revenues or royalties. The total arrangements are for $6.5 million in consideration.

The Company concluded these contractual arrangements represent one arrangement and evaluated its promises to the customer and whether the performance obligations granted under the arrangement were distinct. The licenses provided to the customer are not transferable, are of limited value without the promised development services, and the customer cannot benefit from the license agreements without the specific obligated services in the development subcontract, as there is strong interdependency between the licenses and the development subcontract. Accordingly, the Company determined the licenses were not distinct within the context of the contract and combined the license with other performance obligations. The total transaction price of $6.5 million was allocated to the single performance obligation.

The Company recognizes revenue related to the performance obligations over time using the input method based on costs incurred to date relative to the total expected costs of the contract and began recognizing revenue in the second quarter of 2021 over the contract period. This method depicts performance under the contract and requires the Company to make estimates about the future costs expected to be incurred to perform under the contact, including labor and material costs.

As of December 31, 2022, the Company has billed $5.8 million for the performance under the RAD-Hard 1 contractual agreements. Under the input method of recognition, the Company has recognized $1.7 million in revenue for the year ending December 31, 2022, and $5.0 million in revenue since inception of the contractual agreements. As a result, the Company has recorded $0.8 million in deferred revenue as of December 31, 2022. The Company expects to

recognize the remaining $1.5 million of the transaction price as services are performed throughout the contractual period and performance is expected to be complete in the year ended December 31, 2024.

During the year ended December 31, 2022, the Company executed a contractual arrangement with a customer for the development of a strategic radiation hardened field programmable gate array product, consisting of a technology license to provide design and development services under the contractual agreement (RAD-Hard 2). The Company does not share in the rights to future revenues or royalties. The total arrangement is for $6.5 million in consideration and services are expected to be performed through the year ended December 31, 2024, subject to certain termination and extension provisions defined in the arrangement. The accounting for this contract follows the same revenue recognition as the RAD-Hard 1 contractual agreements. For the year ended December 31, 2022, the Company has billed $0.3 million for the performance under the RAD-Hard 2 contractual agreement. Under the input method of recognition, the Company has recognized $0.3 million in revenue for the year ending December 31, 2022. As a result, the Company does not have a deferred revenue balance as of December 31, 2022 related to the RAD-Hard 2 contractual agreement.