Restructuring charges

12 Months Ended

Dec. 31, 2022

Restructuring and Related Activities [Abstract]

Restructuring charges

Restructuring charges

Restructuring charges for each period were as follows:

	Year ended December 31,
(in thousands)	2022		2021		2020
Cost of revenue	$	8,090	$	70	$	1,201
Research and development	244		600		8,062
Sales and marketing	137		361		10,684
General and administrative	77		195		5,449
Total restructuring charges	$	8,548	$	1,226	$	25,396

Fourth quarter 2022 restructuring

In December 2022, the Company approved a restructuring plan to reduce camera production-related costs by globally realigning its manufacturing footprint to concentrate production activities in two primary locations: China and Thailand. Under the fourth quarter 2022 restructuring, the Company recorded restructuring charges of $8.1 million including $7.0 million for camera production line closure costs and $1.1 million for related transitional costs to migrate production to the Company’s remaining manufacturing locations.

The following table provides a summary of the Company’s restructuring activities and the movement in the related liabilities recorded in accrued expenses and other current liabilities on the Consolidated Balance Sheets under the fourth quarter 2022 restructuring.

(in thousands)	Contract and Other Costs		Total
Restructuring liability as of December 31, 2021	$	—	$	—
Restructuring charges	8,061		8,061
Non-cash reductions	(228)		(228)
Restructuring liability as of December 31, 2022	$	7,833	$	7,833

Second quarter 2020 restructuring

On April 14, 2020, the Company approved a restructuring to reduce future operating expenses, optimize its business model and address the impact of the COVID-19 pandemic. The restructuring provided for a reduction of the Company’s global workforce by approximately 20% and the consolidation of certain leased office facilities. Under the second quarter 2020 restructuring, the Company recorded restructuring charges of $31.5 million to date, including a $12.5 million right-of-use asset impairment primarily related to its headquarters campus, $7.4 million related to severance, and $11.6 million related to accelerated depreciation and other charges.

The Company ceased using a portion of its headquarters campus in the third quarter of 2020 as part of the second quarter 2020 restructuring. The unused portion of the Company’s headquarters campus has its own identifiable expenses and is not dependent on other parts of the Company, and thus was considered its own asset group. As a result, the Company impaired a part of the carrying value of the related right-of-use asset to its estimated fair value using the discounted future cash flows method. The discounted future cash flows were determined based on future sublease rental rates, future sublease market conditions and a discount rate based on the weighted-average cost of capital. Based on the results of the Company’s assessment, the Company recognized a $12.3 million impairment, which was reflected as a restructuring expense, primarily in the operating expense financial statement line items in the Consolidated Statements of Operations.