Disposals

3 Months Ended

Mar. 31, 2026

Discontinued Operations and Disposal Groups [Abstract]

Disposals

Note 2. Disposals

On November 7, 2023, the Board of the Company approved a strategic plan to wind down its powertrain business and preserve the related intellectual property (the “Plan”). As part of the Plan, the Company will continue to focus on commercialization of its KARNO Power Module technology. We have not accounted for the impacts of the Plan as a discontinued operation through March 31, 2026 as we have not abandoned or sold the underlying intellectual property.

Costs paid or settled associated with the Plan during the three months ended March 31, 2026 and 2025 were nil and $0.6 million, respectively. We reclassified assets previously recorded as held for sale totaling $1.0 million to property and equipment, net, on the condensed consolidated balance sheets, and recognized charges of $1.6 million using fair value hierarchy Level III inputs including comparable assets, adjusted for condition, included in exit and termination costs in the condensed consolidated statements of operations for the three months ended March 31, 2025. During the fourth quarter of 2025, we reclassified $1.2 million in assets from property and equipment, net to assets held for sale on the condensed consolidated balance sheets. These assets were subsequently sold in the three months ended March 31, 2026. We recorded net benefits for recoveries related to asset sales of $0.4 million and $0.3 million included in exit and termination (benefits) costs in the condensed consolidated statements of operations and in gain on disposal of assets in the condensed consolidated statements of cash flows for the three months ended March 31, 2026 and 2025, respectively.