Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The following tables provide information by level for the Company’s assets and liabilities that were measured at fair value on a recurring basis (in thousands):

	September 30, 2024
	Level 1		Level 2		Level 3		Total
Assets
Cash and cash equivalents:
Money market funds	$	17,043	$	—	$	—	$	17,043
Short-term investments:
Commercial paper	—		$	53,832	—		53,832
Corporate debt and U.S. government agency securities	—		$	53,213	—		53,213
Total short-term investments	—		107,045		—		107,045
Total financial assets	$	17,043	$	107,045	$	—	$	124,088
Liabilities
Warrant liabilities	$	—	$	—	$	38	$	38
Total financial liabilities	$	—	$	—	$	38	$	38

	December 31, 2023
	Level 1		Level 2		Level 3			Total
Assets
Cash and cash equivalents:
Money market funds	$	7,354	$	—	$	—		$	7,354
Commercial paper	—		2,989		—			2,989
Short-term investments:
Commercial paper	—		80,620		—		`	80,620
Corporate debt and U.S. government agency securities	—		58,538					58,538
Total short-term investments	$	—	$	139,158	$	—		$	139,158
Total financial assets	$	7,354	$	142,147	$	—		$	149,501
Liabilities
Warrant liabilities	$	—	$	—	$	229		$	229
Total financial liabilities	$	—	$	—	$	229		$	229

Money market funds are included within Level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets. Market valuations of our investments which are classified as Level 2 are provided by an independent third party. In accordance with the fair value hierarchy, the market valuation sources include observable market inputs and are therefore considered Level 2 inputs for purposes of determining the fair values.

The fair value of the Private Placement warrant liabilities is based on significant unobservable inputs, which represent Level 3 measurements within the fair value hierarchy. In determining the fair value of the warrant liabilities, the Company used the Black-Scholes option pricing model to estimate the fair value using unobservable inputs including the expected term, expected volatility, risk-free interest rate and dividend yield (see Note 7).

The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments (in thousands):

	Private Placement Warrant Liability
Fair value as of December 31, 2023	$	229
Change in the fair value included in other income, net	(191)
Fair value as of September 30, 2024	$	38
Fair value as of December 31, 2022	$	180
Change in the fair value included in other income, net	(67)
Fair value as of September 30, 2023	$	113

Non-Recurring Fair Value Measurements

The Company has certain assets, including intangible assets, which are measured at fair value on a non-recurring basis and are adjusted to fair value only if an impairment charge is recognized. The categorization of the framework used to measure fair value of the assets is considered to be within the Level 3 valuation hierarchy due to the subjective nature of the unobservable inputs used.

Disclosure of Fair Values

The Company’s financial instruments that are not re-measured at fair value include accounts receivable, accounts payable, accrued and other current liabilities. The carrying values of these financial instruments approximate their fair values. The Company acquired short-term investments consisting of commercial paper, corporate debt and U.S. government agency securities as a result of the merger with Velodyne that closed on February 10, 2023 (see Note 3). Unrealized gains and losses on the Company’s short-term investments were not significant as of September 30, 2024 and December 31, 2023, and therefore, the amortized cost of the Company’s short-term investments approximated its fair value.