UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________

FORM 10-Q

___________________________________

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission file number 001-40481

___________________________________________________________________

INDIE SEMICONDUCTOR, INC.

___________________________________________________________________

(Exact name of registrant as specified in its charter)

Delaware	88-1735159
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
32 Journey Aliso Viejo, California	92656
(Address of Principal Executive Offices)	(Zip Code)

(949) 608-0854

Registrant’s telephone number, including area code

___________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	INDI	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).     Yes  x   No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	o
		Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes   o     No  x

The number of shares outstanding of the registrant’s Class A and Class V common stock as of May 7, 2024 was 168,168,203 (excluding 1,725,000 Class A shares held in escrow and 26,064 Class A shares subject to restricted stock awards) and 18,594,328, respectively.

INDIE SEMICONDUCTOR, INC.

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2024

Table of Contents

		Page
Part I. Financial Information		2
Item 1.	Condensed Consolidated Financial Statements as of March 31, 2024 and December 31, 2023 and for the three months ended March 31, 2024 and 2023 (Unaudited)	2
	Condensed Consolidated Balance Sheets	2
	Condensed Consolidated Statements of Operations	3
	Condensed Consolidated Statements of Comprehensive Loss	4
	Condensed Consolidated Statements of Changes in Stockholders’ Equity and Noncontrolling Interest	5
	Condensed Consolidated Statements of Cash Flows	7
	Notes to Unaudited Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	35
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	41
Item 4.	Controls and Procedures	42
Part II. Other Information		44
Item 1.	Legal Proceedings	44
Item 1A.	Risk Factors	44
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44
Item 3.	Defaults upon Senior Securities	44
Item 4.	Mine Safety Disclosures	44
Item 5.	Other Information	44
Item 6.	Exhibits	44
Signatures		46

1

FORWARD-LOOKING STATEMENTS

This report contains “forward-looking statements” (within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended). Such statements include, but are not limited to, statements regarding the Company’s future business and financial performance and prospects, and other statements identified by words such as “will likely result,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “plan,” “project,” “outlook,” “should,” “could,” “may” or words of similar meaning. Such forward-looking statements are based upon the current beliefs and expectations of the Company’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond our control. Actual results and the timing of events may differ materially from the anticipated results or other expectations expressed in or implied by such forward-looking statements as a result of various factors, including, among others, the following: macroeconomic conditions, including inflation, rising interest rates and volatility in the credit and financial markets; the Company’s reliance on contract manufacturing and outsourced supply chain and the availability of semiconductors and manufacturing capacity; competitive products and pricing pressures; the Company’s ability to win competitive bid selection processes and achieve additional design wins; the impact of any acquisitions the Company has made or may make, including its ability to successfully integrate acquired businesses and risks that the anticipated benefits of any acquisitions may not be fully realized or take longer to realize than expected; management’s ability to develop, market and gain acceptance for new and enhanced products and expand into new technologies and markets; trade restrictions and trade tensions; political or economic instability in the Company’s target markets; and the impact of the ongoing conflict in Ukraine and the Middle East; and additional factors disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the U.S. Securities and Exchange Commission (“SEC”) on February 29, 2024 (including those identified under “Risk Factors” therein), as such risk factors may be amended, supplemented or superseded from time to time in the Company’s other public reports filed with the SEC. indie cautions that the foregoing list of factors is not exclusive.

All information set forth herein speaks only as of the date hereof, and the Company disclaims any intention or obligation to update any forward-looking statements made in this report or in its other public filings, whether as a result of new information, future events or otherwise, except as required by law.

References in this Quarterly Report on Form 10-Q to “indie,” the “Company,” “we,” “us,” and “our” refer to indie Semiconductor, Inc., a Delaware corporation, and its consolidated subsidiaries, or (in the case of references prior to the consummation of the business combination (the “Transaction”) with Thunder Bridge Acquisition II, Ltd. (“TB2”) in June 2021) to our predecessor Ay Dee Kay, LLC, a California limited liability company (“ADK LLC”). All references to U.S. dollar amounts are in thousands, other than share amounts, per share amount or the context otherwise requires.

1

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INDIE SEMICONDUCTOR, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share and per share amounts)

(Unaudited)

	March 31, 2024		December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	138,174	$	151,678
Restricted cash	10,000		—
Accounts receivable, net of allowance for doubtful accounts of $156 and $192 for March 31, 2024 and December 31, 2023, respectively	52,418		63,602
Inventory, net	37,899		33,141
Prepaid expenses and other current assets	25,259		23,399
Total current assets	263,750		271,820
Property and equipment, net	29,399		26,966
Intangible assets, net	198,635		208,134
Goodwill	290,397		295,096
Operating lease right-of-use assets	14,332		13,790
Other assets and deposits	7,135		3,070
Total assets	$	803,648	$	818,876
Liabilities and stockholders' equity
Accounts payable	$	18,955	$	18,405
Accrued payroll liabilities	13,037		6,621
Contingent consideration	75,122		83,903
Accrued expenses and other current liabilities	29,280		21,411
Intangible asset contract liability	2,088		4,429
Current debt obligations	13,184		4,106
Total current liabilities	151,666		138,875
Long-term debt, net of current portion	156,996		156,735
Deferred tax liabilities, non-current	13,047		13,696
Operating lease liability, non-current	11,258		10,850
Other long-term liabilities	9,210		21,695
Total liabilities	342,177		341,851
Commitments and contingencies (Note 17)
Stockholders' equity
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; no shares issued or outstanding	—		—
Class A common stock, $0.0001 par value, 400,000,000 shares authorized, 167,864,185 and 164,979,958 shares issued, 166,104,433 and 163,193,278 shares outstanding as of March 31, 2024 and December 31, 2023, respectively.	17		16
Class V common stock, $0.0001 par value, 40,000,000 shares authorized, 18,594,332 and 18,694,332 issued and outstanding as of March 31, 2024 and December 31, 2023, respectively.	2		2
Additional paid-in capital	836,286		813,742
Accumulated deficit	(392,620)		(361,441)
Accumulated other comprehensive loss	(10,808)		(6,170)
indie's stockholders' equity	432,877		446,149
Noncontrolling interest	28,594		30,876
Total stockholders' equity	461,471		477,025
Total liabilities and stockholders' equity	$	803,648	$	818,876

See accompanying notes to the condensed consolidated financial statements.

2

INDIE SEMICONDUCTOR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share and per share amounts)

(Unaudited)

	Three Months Ended March 31,
	2024		2023
Revenue:
Product revenue	$	48,578	$	33,653
Contract revenue	3,775		6,799
Total revenue	52,353		40,452
Operating expenses:
Cost of goods sold	30,089		24,056
Research and development	49,589		36,563
Selling, general, and administrative	22,322		16,814
Total operating expenses	102,000		77,433
Loss from operations	(49,647)		(36,981)
Other income (expense), net:
Interest income	1,309		2,419
Interest expense	(2,106)		(2,148)
Loss from change in fair value of warrants	—		(47,332)
Gain (loss) from change in fair value of contingent considerations and acquisition-related holdbacks	15,359		(1,630)
Other expense	(247)		—
Total other income (expense), net	14,315		(48,691)
Net loss before income taxes	(35,332)		(85,672)
Income tax benefit	1,109		3,706
Net loss	(34,223)		(81,966)
Less: Net loss attributable to noncontrolling interest	(3,044)		(9,220)
Net loss attributable to indie Semiconductor, Inc.	$	(31,179)	$	(72,746)
Net loss attributable to common shares — basic	$	(31,179)	$	(72,746)
Net loss attributable to common shares — diluted	$	(31,179)	$	(72,746)
Net loss per share attributable to common shares — basic	$	(0.19)	$	(0.55)
Net loss per share attributable to common shares — diluted	$	(0.19)	$	(0.55)
Weighted average common shares outstanding — basic	164,602,608		131,490,221
Weighted average common shares outstanding — diluted	164,602,608		131,490,221

See accompanying notes to the condensed consolidated financial statements.

3

INDIE SEMICONDUCTOR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Amounts in thousands)

(Unaudited)

	Three Months Ended March 31,
	2024		2023
Net loss	$	(34,223)	$	(81,966)
Other comprehensive loss:
Foreign currency translation adjustments	(4,638)		(2,205)
Comprehensive loss	(38,861)		(84,171)
Less: Comprehensive loss attributable to noncontrolling interest	(2,955)		(9,925)
Comprehensive loss attributable to indie Semiconductor, Inc.	$	(35,906)	$	(74,246)

See accompanying notes to the condensed consolidated financial statements.

4

INDIE SEMICONDUCTOR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND NONCONTROLLING INTEREST

(Amounts in thousands, except unit and share amounts)

(Unaudited)

	Common Stock Class A			Common Stock Class V			Additional Paid-in Capital		Accumulated Deficit			Accumulated Other Comprehensive Loss		Total Stockholders' Equity Attributable to indie Semiconductor, Inc.		Noncontrolling Interest		Total Stockholders' Equity
	Shares	Amount		Shares	Amount
Balance as of December 31, 2022	126,824,465	$	13	21,381,476	$	2	$	568,564	$	(243,816)		$	(11,951)	$	312,812	$	1,520	$	314,332
Vesting of equity awards	95,160	—		—	—		—		—			—		—		—		—
Issuance per net settlement of equity awards and cash exercise of stock options	836,984	—		—	—		(148)		—			—		(148)		167		19
Issuance per Exchange of Class V to Class A	1,551,531	—		(1,551,531)	—		(2,653)		—			—		(2,653)		2,653		—
Issuance per Exchange of ADK LLC units to Class A	74,817	—		—	—		—		—			—		—		—		—
Share-based compensation	—	—		—	—		8,372		—			—		8,372		—		8,372
Issuance in connection with At-The-Market equity offering	3,316,198	—		—	—		34,194		—			—		34,194		—		34,194
Shares issued due to acquisition of GEO Semiconductor Inc.	6,868,768	1		—	—		74,176		—			—		74,177		1,380		75,557
Shares issued due to acquisition of Silicon Radar GmbH	982,445	—		—	—		9,585		—			—		9,585		249		9,834
Net loss	—	—		—	—		—		(72,746)			—		(72,746)		(9,220)		(81,966)
Foreign currency translation adjustment	—	—		—	—		—		—			(1,500)		(1,500)		(705)		(2,205)
Balance as of March 31, 2023	140,550,368	$	14	19,829,945	$	2	$	692,090	$	(316,562)	—	$	(13,451)	$	362,093	$	(3,956)	$	358,137

5

INDIE SEMICONDUCTOR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND NONCONTROLLING INTEREST

(Amounts in thousands, except unit and share amounts)

(Unaudited)

	Common Stock Class A			Common Stock Class V			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity Attributable to indie Semiconductor, Inc.		Noncontrolling Interest		Total Stockholders' Equity
	Shares	Amount		Shares	Amount
Balance as of December 31, 2023	163,193,278	$	16	18,694,332	$	2	$	813,742	$	(361,441)	$	(6,170)	$	446,149	$	30,876	$	477,025
Vesting of equity awards	26,931	—		—	—		—		—		—		—		—		—
Issuance per net settlement of equity awards and cash exercise of stock options	2,166,146	—		—	—		473		—		—		473		204		677
Issuance per Exchange of Class V to Class A	100,000	—		(100,000)	—		—		—		—		—		—		—
Issuance per Exchange of ADK LLC units to Class A	30,516	—		—	—		—		—		—		—		—		—
Share-based compensation	—	—		—	—		18,608		—		—		18,608		—		18,608
Issuance per settlement of contingent considerations	62,562	—		—	—		500		—		—		500		48		548
Shares issued for Investment in Expedera	525,000	1		—	—		2,963		—		—		2,964		421		3,385
Net loss	—	—		—	—		—		(31,179)		—		(31,179)		(3,044)		(34,223)
Foreign currency translation adjustment	—	—		—	—		—		—		(4,638)		(4,638)		89		(4,549)
Balance as of March 31, 2024	166,104,433	$	17	18,594,332	$	2	$	836,286	$	(392,620)	$	(10,808)	$	432,877	$	28,594	$	461,471

See accompanying notes to the condensed consolidated financial statements.

6

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INDIE SEMICONDUCTOR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

	Three Months Ended March 31,
	2024		2023
Cash flows from operating activities:
Net loss	$	(34,223)	$	(81,966)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	9,551		6,035
Amortization of inventory step-up	—		2,537
Allowance for credit losses and inventory reserves	262		31
Share-based compensation	25,577		11,395
Amortization of discount and cost of issuance of debt	250		259
Loss from change in fair value of warrants	—		47,332
(Gain) loss from change in fair value of contingent considerations and acquisition-related holdbacks	(15,359)		1,630
Loss from change in fair value of currency forward contract	552		—
Deferred tax liabilities	—		(3,716)
Amortization of right-of-use assets	822		525
Changes in operating assets and liabilities:
Accounts receivable	11,752		4,823
Inventory	(1,051)		(9,973)
Accounts payable	(414)		(2,937)
Accrued expenses and other current liabilities	(4,429)		(2,085)
Accrued payroll liabilities	454		269
Prepaid and other current assets	(1,816)		(5,627)
Operating lease liabilities	(824)		(453)
Other long-term liabilities	(453)		(964)
Net cash used in operating activities	(9,349)		(32,885)
Cash flows from investing activities:
Purchases of property and equipment	(2,317)		(3,199)
Business combinations, net of cash acquired	(3,200)		(98,429)
Net cash used in investing activities	(5,517)		(101,628)
Cash flows from financing activities:
Proceeds from issuance of common stock/At-the-market offering	—		34,946
Offering costs for the issuance of common stock/At-the-market offering	—		(752)
Proceeds from issuance of short-term debt obligations	10,740		747
Issuance costs on line of credit	(50)		—
Payments on debt obligations	(1,493)		(11,825)
Payments on financed software	(2,341)		(2,069)
Proceeds from exercise of stock options	24		19
Net cash provided by financing activities	6,880		21,066
Effect of exchange rate changes on cash and cash equivalents	4,482		(1,034)
Net decrease in cash and cash equivalents	(3,504)		(114,481)
Cash, cash equivalents and restricted cash at beginning of period	151,678		321,879
Cash, cash equivalents and restricted cash at end of period	$	148,174	$	207,398

7

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Reconciliation of amounts on condensed consolidated balance sheet:
Cash and cash equivalents	$	138,174	$	207,398
Restricted cash	10,000		—
Total cash, cash equivalents and restricted cash	$	148,174	$	207,398
Supplemental disclosure of cash flow information:
Cash paid for interest	$	70	$	88
Supplemental disclosure of non-cash investing and financing activities:
Purchases of property and equipment, accrued but not paid	$	(890)	$	348
Fair value of common stock issued for business combination	$	—	$	85,391
Fair value of common stock issuable for business combination	$	—	$	20,979
Contingent consideration for business combination	$	4,599	$	73,047
Accrual for purchase consideration for business combination	$	1,300	$	4,264
Fair value of common stock issued for investment in Expedera	$	3,428	$	—

See accompanying notes to the condensed consolidated financial statements.

8

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INDIE SEMICONDUCTOR, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(amounts in thousands, except unit and share amounts and per unit and per share amounts)

(Unaudited)

1.    Nature of the Business and Basis of Presentation

indie Semiconductor, Inc. (“indie”) and its predecessor for accounting purposes, Ay Dee Kay, LLC, a California limited liability company (“ADK LLC”) and its subsidiaries are collectively referred to herein as the “Company.” The Company offers highly innovative automotive semiconductors and software solutions for Advanced Driver Assistance Systems (“ADAS”), autonomous vehicle, connected car, user experience and electrification applications. The Company focuses on edge sensors across multiple modalities spanning LiDAR, radar, ultrasound and computer vision. These functions represent the core underpinnings of both electric and autonomous vehicles, while the advanced user interfaces are transforming the in-cabin experience to mirror and seamlessly connect to the mobile platforms people rely on every day. indie is an approved vendor to Tier 1 automotive suppliers and its platforms can be found in marquee automotive manufacturers around the world. Headquartered in Aliso Viejo, California, indie has design centers and sales offices in Austin, Texas; Boston, Massachusetts; Detroit, Michigan; San Francisco and San Jose, California; Cordoba, Argentina; Budapest, Hungary; Dresden, Frankfurt an der Oder, Munich and Nuremberg, Germany; Edinburgh, Scotland; Schlieren, Switzerland; Rabat, Morocco; Haifa, Israel; Quebec City and Toronto, Canada; Seoul, South Korea; Tokyo, Japan and several locations throughout China. The Company engages subcontractors to manufacture its products. The majority of these subcontractors are located in Asia.

Execution of At-The-Market Agreement

On August 26, 2022, the Company entered into an At Market Issuance Agreement (“ATM Agreement”) with B. Riley Securities, Inc., Craig-Hallum Capital Group LLC and Roth Capital Partners, LLC (collectively as “Sales Agents”) relating to shares of its Class A common stock, par value $0.0001 per share (the “Class A common stock”). In accordance with the terms of the ATM Agreement, the Company may offer and sell shares of its Class A common stock having an aggregate offering price of up to $150,000 from time to time through the Sales Agents, acting as the Company’s agent or principal. The Company implemented this program for the flexible access that it provides to the capital markets. As of March 31, 2024, and since the inception of the program indie has raised gross proceeds of $70,339 and issued 7,351,259 shares of Class A common stock at an average per-share sales price of $9.57 and had approximately $79,661 available for future issuances under the ATM Agreement. During the three months ended March 31, 2023, indie raised gross proceeds of $34,946 and issued 3,316,198 shares of Class A common stock at an average per-share sales price of $10.54. For the three months ended March 31, 2023, indie incurred total issuance costs of $751. There was no activity during the three months ended March 31, 2024.

Recent Acquisition

On January 25, 2024 (the “Deal Closing Date”), indie and ADK LLC completed its acquisition of Kinetic Technologies, LLC (“Kinetic”). The acquisition was consummated pursuant to an Asset Purchase Agreement (the “APA”) to acquire certain research and development personnel, intellectual property and business properties from Kinetic, in support of a custom product development for a North American electric vehicle original equipment manufacturer (“OEM”). The closing consideration consisted of (i) $3,200 in cash as the initial cash consideration, net of an adjustment holdback amount of $500 and an indemnity holdback amount of $800, (ii) $2,348 of total contingent considerations, payable in cash or Class A common stock, subject to achievement of certain production based milestones 24 months after the Deal Closing Date (“the Production Earnout”), and (iii) $2,251 of contingent considerations, payable in cash or Class A common stock, subject to achievement of certain revenue based milestones 12 months after the Deal Closing Date (“the Revenue Earnout”). The purchase price was subject to working capital and other adjustments as provided in the APA. The indemnity holdback amount is payable within five business days after the 18-month anniversary of the Deal Closing Date and is payable in shares of Class A common stock.

See Note 2 — Business Combinations for a full description of all of the recent acquisitions.

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Risks and Uncertainties

Current and continued inflationary conditions have led, and may continue to lead to rising prices or rising interest rates, which has had a dampening effect on overall economic activity and consumer demand for automotive products. Additionally, the conflict in the Middle East and the implication of this event has created global political and economic uncertainty. The Company is closely monitoring developments, including potential impact to the Company’s business, customers, suppliers, its employees and operations in Israel, the Middle East and elsewhere. At this time, the impact to indie is subject to change given the volatile nature of the situation.

Refer to Part I, Item 1A of our 2023 Annual Report on Form 10-K for the fiscal year ended December 31, 2023 under the heading “Risk Factors” for more information on our risks and uncertainties.

Basis of Presentation

The condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and the Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). The condensed consolidated financial statements include the condensed consolidated accounts of the Company’s majority-owned subsidiary, ADK LLC, of which approximately 90% was owned by indie as of March 31, 2024. ADK LLC’s condensed consolidated financial statements include its wholly-owned subsidiaries indie Services Corporation, indie LLC and indie City LLC, all California entities, Ay Dee Kay Limited, a private limited company incorporated under the laws of Scotland, indie GmbH, Symeo GmbH, and Silicon Radar GmbH (“Silicon Radar”), all of which are private limited liability companies incorporated under the laws of Germany, Exalos AG (“Exalos”), a company limited by shares organized under the laws of Switzerland, indie Kft, a limited liability company incorporated under the laws of Hungary, TeraXion Inc. and Geo Semiconductor Canada Inc., both incorporated under the laws of Canada, indie Semiconductor Israel Ltd., a private limited company incorporated under the laws of Israel, Ay Dee Kay S.A., a limited liability company incorporated under the laws of Argentina, indie Semiconductor Morocco, a limited liability company under the laws of Morocco, indie Semiconductor Japan KK, a limited liability company under the laws of Japan, Wuxi indie Microelectronics (“Wuxi”), a Chinese entity with approximately 59% voting controlled and approximately 34% owned by the Company as of March 31, 2024 and Wuxi’s wholly-owned subsidiaries, indie Semiconductor Suzhou, indie Semiconductor HK, Ltd and Shanghai Ziying Microelectronics Co., Ltd.

All significant intercompany accounts and transactions of the subsidiaries have been eliminated in consolidation. The noncontrolling interest attributable to the Company’s less-than-wholly-owned subsidiary is presented as a separate component from stockholders’ equity (deficit) in the condensed consolidated balance sheets, and a noncontrolling interest in the condensed consolidated statements of operations and condensed consolidated statements of stockholders’ equity (deficit) and noncontrolling interest.

Unaudited Interim Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC for interim financial reporting. Certain information and footnote disclosures, normally included in annual consolidated financial statements prepared in accordance with U.S. GAAP, have been condensed or omitted pursuant to those rules and regulations. However, in management’s opinion, the financial information reflects all adjustments, including those of a normal recurring nature, necessary to present fairly the results of operations, financial position, and cash flows of the Company for the periods presented. The results of operations, financial position, and cash flows for the Company during the interim periods are not necessarily indicative of those expected for the full year. This information should be read in conjunction with the Company’s consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 29, 2024.

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Significant Accounting Policies

The Company’s significant accounting policies are disclosed in its Annual Report on Form 10-K for the year ended December 31, 2023. There has been no material change to the Company’s significant accounting policies during the three months ended March 31, 2024.

Recent Accounting Pronouncements

Recently Issued Not Yet Adopted Accounting Pronouncements

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740) — Improvements to Income Tax Disclosures, to require enhanced income tax disclosures to provide information to assess how an entity’s operations and related tax risks, tax planning, and operational opportunities affect its tax rate and prospects for future cash flows. The amendments in this update provide that a business entity disclose (1) a tabular income tax rate reconciliation, using both percentages and amounts, (2) separate disclosure of any individual reconciling items that are equal to or greater than 5% of the amount computed by multiplying the income (loss) from continuing operations before income taxes by the applicable statutory income tax rate, and disaggregation of certain items that are significant and (3) amount of income taxes paid (net of refunds received) disaggregated by federal, state and foreign jurisdictions, including separate disclosure of any individual jurisdictions greater than 5% of total income taxes paid. These amendments are effective for the Company for annual periods in 2025, applied prospectively, with early adoption and retrospective application permitted. The Company intends to adopt the amendments in this update prospectively in 2025. The impact of the adoption of the amendments in this update is not expected to be material to the Company’s condensed consolidated financial position and results of operations, since the amendments require only enhancement of existing income tax disclosures in the notes to the Company’s condensed consolidated financial statements.

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures, to require enhanced disclosures that include reportable segment expenses. The amendments in this update provide that a business entity disclose significant segment expenses, segment profit or loss (after significant segment expenses), and allows reporting of additional measures of a segments profit or loss if used in assessing segment performance. Such disclosures apply to entities with a single reportable segment and are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, on a retrospective basis. Early adoption is permitted. The Company is currently evaluating the impact of ASU 2023-07 on its condensed consolidated financial statements and related disclosures.

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2.    Business Combinations

The Company acquired Silicon Radar in February 2023, GEO Semiconductor, Inc. (“GEO”) in March 2023, Exalos in September 2023, and Kinetic in January 2024. These acquisitions were recorded by allocating the purchase consideration to the net assets acquired based on their estimated fair values at the acquisition date. The excess of the purchase consideration for the acquisition over the fair value of the net assets acquired is recorded as goodwill. The following presents the preliminary allocation of the purchase consideration to the assets acquired and liabilities assumed for Exalos and Kinetic, and the final allocation of the purchase consideration to the assets acquired and liabilities assumed for Silicon Radar and GEO as of March 31, 2024:

	Kinetic		Exalos		Silicon Radar		GEO
Purchase price - cash consideration paid	$	3,200	$	—	$	8,653	$	91,076
Purchase price - cash consideration accrued	1,300		—		800		3,464
Less: cash acquired	—		(3,439)		(208)		(1,092)
Net cash consideration	$	4,500	$	(3,439)	$	9,245	$	93,448
Purchase price - equity consideration issued (common stock)	$	—	$	42,791	$	9,834	$	75,556
Purchase price - equity consideration issuable (common stock)	—		2,500		—		20,979
Total equity consideration	$	—	$	45,291	$	9,834	$	96,535
Contingent consideration	4,599		13,225		9,240		59,280
Net consideration	$	9,099	$	55,077	$	28,319	$	249,263
Estimated fair value of net assets and liabilities assumed:
Current assets other than cash	$	6,040	$	4,408	$	2,979	$	24,043
Property and equipment	962		1,001		781		178
Developed technology	455		7,968		4,950		69,330
In-process research & development	750		7,968		8,870		27,040
Customer relationships	250		5,312		4,340		14,220
Backlog	19		664		150		390
Trade name	97		3,984		2,130		10,320
Operating lease right-of-use assets step-up	—		664		—		—
Other non-current assets	729		—		17		10
Current liabilities	(650)		(3,541)		(1,585)		(6,084)
Deferred revenue	—		—		(512)		—
Deferred tax liabilities, non-current	—		(5,318)		(2,772)		(1,982)
Other non-current liabilities	(217)		—		—		(711)
Total fair value of net assets acquired	$	8,435	$	23,110	$	19,348	$	136,754
Goodwill	$	664	$	31,967	$	8,971	$	112,509

For all acquisitions, trade receivables and payables, as well as other current and non-current assets and liabilities and deferred revenue, were valued at the existing carrying value as they represented the fair value of those items at the acquisition date, based on management’s judgments and estimates.

Because the acquisitions related to Exalos and Kinetic occurred relatively recently, and in light of the magnitude of the transactions, the significant information to be obtained and analyzed and the fact that Exalos resides in a foreign jurisdiction, the Company’s fair value estimates for the purchase price allocation are preliminary and may change during the allowable measurement period, which is up to the point the Company obtains and analyzes the information that existed as of the date of the acquisition necessary to determine the fair values of the assets acquired and liabilities assumed, but in no case to exceed more than one year from the date of the acquisition. Changes in the estimated fair values of the net assets recorded for the business combinations of Exalos and Kinetic upon the finalization of more detailed analyses of the facts and circumstances that

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existed at the date of the transactions will change the allocation of the purchase price. Subsequent changes to the purchase allocation during the measurement period that are material will be recorded in the reporting period in which the adjustment amounts are determined. As of May 9, 2024, the Company had not finalized the determination of fair values allocated to various assets and liabilities, including, but not limited to, inventory, property, plant and equipment, identifiable intangible assets, deferred taxes, goodwill, tax uncertainties, income taxes payable and other liabilities. Specifically for the valuation of intangibles assets acquired, the Company used publicly available benchmarking information, as well as a variety of other assumptions, including market participant assumptions to determine the preliminary values. Any changes in the fair values of the assets acquired and liabilities assumed during the measurement period may result in material adjustments to goodwill and/or deferred taxes.

Acquisition of Silicon Radar GmbH

On February 21, 2023, Symeo, a wholly-owned subsidiary of the Company, completed its acquisition of all of the outstanding capital stock of Silicon Radar. The acquisition was consummated pursuant to a Share Purchase Agreement by and among Symeo, the Company and the holders of the outstanding capital stock of Silicon Radar. The closing consideration consisted of (i) $9,245 in cash (including accrued cash consideration at closing and net of cash acquired), (ii) approximately 982,445 shares of Class A common stock of the Company, with a fair value of $9,834, and (iii) a contingent consideration payable in cash or in Class A common stock subject to Silicon Radar’s achievement of certain revenue-based milestones through February 21, 2025. The fair value of this contingent consideration was $9,240 on February 21, 2023. The purchase price is subject to working capital and other adjustments as provided in the Share Purchase Agreement.

The Company paid a premium (i.e. goodwill) over the fair value of the net tangible and identified intangible assets acquired as this acquisition brings the Company an engineering development team with broad experience in radar system, which is expected to expand indie’s entry into the radar market and enable the Company to capture strategic opportunities among Tier 1 customers. The goodwill is not deductible for tax purposes.

The Company maintained an adjustment holdback for the purpose of providing security against any adjustment to the amounts at closing. The holdback period extended for 12 months from the closing date and was settled by cash in February 2024.

Total purchase consideration transferred at closing also included contingent consideration that had a fair value of $9,240 as of the acquisition date, which was determined by conducting a Monte Carlo Simulation Analysis. The contingent consideration is comprised of two tranches, both subject to Silicon Radar achieving certain revenue targets. Both tranches are payable, up to a maximum of $9,000, upon the achievement of a revenue threshold of $5,000 for the twelve-month period ending on February 21, 2024 and the achievement of revenue threshold of $7,000 for the twelve-month period ending on February 21, 2025, respectively. Both tranches are payable in cash or common stock, at indie’s election. Should indie elect to pay in common stock, the number of shares issuable equals the earnout amount divided by a volume-weighted-average-price (“VWAP”) for 20 days ending prior to the due date for payment. The fair value of any outstanding contingent consideration liabilities will be remeasured as of the end of each reporting period with any resulting remeasurement gains or losses recognized in the condensed consolidated statement of operations. The first tranche of this earn-out liability is reflected in Contingent consideration and the second tranche is reflected in Other long-term liabilities in the condensed consolidated balance sheet as of March 31, 2024.

As of December 31, 2023, the Company finalized the opening net assets acquired and goodwill.

The fair value of inventory was calculated using the cost of goods sold to estimate the selling price. The selling price was adjusted for selling costs and a reasonable profit margin.

Four separate developed technologies relating to radar sensors with different frequencies were identified at the time of the acquisition. Developed technologies were each valued using relief from royalty of the income approach. The selected royalty rate was determined based on an analysis of licensing agreements related to similar technologies and was further adjusted to reflect the maintenance research and development expenses associated with sustaining the technology. The economic useful life for the identified assets range between three years and ten years based on the technology cycle related to each developed technology, as well as the cash flows over the forecast period.

Customer relationships represents the fair value of future projected revenue that will be derived from sales of products to existing customers of Silicon Radar. The fair value was determined by applying the excess earnings method of the income approach. The economic useful life was determined to be ten years.

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Backlog relates to various purchase orders in place with Silicon Radar’s customers at the time of the acquisition. The fair value was determined by applying the excess earnings method of the income approach. The economic useful life was determined to be two years was determined.

Trade name relates to the “Silicon Radar” trade name. The fair value was determined by applying the relief from royalty of the income approach. The selected royalty rate was determined based on an analysis of licensing agreements related to similar brand names. The economic useful life was determined to be seven years.

The fair value of in-process research and development (“IPR&D”) was determined based on the projected total costs-to-complete at the time of the acquisition. If the development is abandoned in the future, these assets will be expensed in the period of abandonment. If and when the development activities are completed, IPR&D assets will be reclassified to developed technology, management will make a determination of the useful lives and methods of amortization of these assets.

Under both the relief from royalty and costs-to-complete methods, the fair value models incorporated estimates of future cash flows, estimates of allocations of certain assets and cash flows, estimates of future growth rates and management’s judgment regarding the applicable discount rates to use to discount such estimates of cash flows. Because the estimates and assumptions made by management at the time of the acquisitions are unobservable and significant to the overall fair value measurement of these acquired identifiable intangible assets, the corresponding fair values are classified as Level 3 fair value hierarchy measurements.

Pro forma financial information for Silicon Radar is not disclosed as the results are not material to the Company’s condensed consolidated financial statements.

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Acquisition of GEO Semiconductor Inc.

On February 9, 2023, indie entered into an Agreement and Plan of Merger, pursuant to which Gonzaga Merger Sub Inc., a Delaware corporation and indie’s wholly-owned subsidiary, will merge with and into GEO Semiconductor Inc., a Delaware corporation, with GEO surviving as a wholly-owned subsidiary of indie. The aggregate consideration for this transaction consisted of (i) $93,448 in cash (including accrued cash consideration at closing and net of cash acquired); (ii) the issuance by indie of 6,868,768 shares of Class A common stock at closing, with a fair value of $75,556; (iii) 1,907,180 shares of Class A common stock at closing, with a fair value of $20,979 payable in the next 24 month period after closing for the purpose of adjustment and indemnity holdbacks; and (iv) contingent consideration with fair value of $59,280 at closing payable in cash or in Class A common stock, subject to achieving certain GEO-related revenue targets through September 30, 2024. The purchase price is subject to working capital and other adjustments as provided in the Agreement and Plan of Merger. The transaction was completed on March 3, 2023.

GEO has programs with major image sensor suppliers and is engaged in multiple EV and autonomous vehicle programs. Its products comprise three generations of application specific camera video processors, including those focused on viewing, where video is projected on a display and viewed by the driver, and sensing, where video is processed using advanced computer vision and machine learning algorithms to assist the driver. The unique ability to support both of these key categories is expected to allow indie to deliver solutions in applications ranging from simple backup cameras to full Autonomous Driving platforms. Accordingly, indie paid a premium (i.e. goodwill) over the fair value of the net tangible and identifiable intangible assets acquired as this acquisition is expected to continue to strengthen indie’s expansion into the ADAS and autonomous vehicles market. The goodwill is not deductible for tax purposes.

The Company maintains an indemnity and adjustment holdback for the purpose of providing security against any adjustment to the amounts at closing. The indemnity holdback period extends for 24 months from the anniversary of the closing date. The indemnity holdback will be settled by transferring up to 1,566,472 shares of the Company’s Class A common stock. The fair value of the indemnity holdback was $17,231 as of the acquisition date. The adjustment holdback represents up to 340,708 shares of the Company’s stock and its period extended for 60 days from the closing date. The fair value of the adjustment holdback was $3,748 as of the acquisition date, and was remeasured as of the end of each reporting period with any resulting remeasurement gains or losses recognized in the consolidated statement of operations. On July 7, 2023, the adjustment holdback was settled and 291,366 shares of Class A common stock were issued with a final fair value of $2,651. Accordingly, the fair value of the adjustment holdback was reduced to zero as of December 31, 2023 and a gain of $1,096 was recorded in Other income (expense), net for the year ended December 31, 2023 in the consolidated statement of operations. The indemnity holdback is reflected in Other long-term liabilities in the condensed consolidated balance sheet as of March 31, 2024.

Total purchase consideration transferred at closing included contingent consideration that had a fair value of $59,280 as of the acquisition date, which was determined by conducting a Monte Carlo Simulation analysis. The contingent consideration is comprised of two tranches, both subject to GEO achieving certain GEO-related revenue targets. The first tranche is payable, up to a maximum of $55,000, upon the achievement of a revenue threshold of $20,000 for the twelve-month period ended on March 31, 2024. The second tranche payable, up to a maximum of $35,000, upon the achievement of revenue threshold of $10,000 for the six-month period ending on September 30, 2024. Both tranches are payable in cash or common stock, at indie’s election. Should indie elect to pay in common stock, the number of shares issuable through a payment in common stock equals the earnout amount divided by a 20 days VWAP ending on each earnout period and is collared between $8.50 and $11.50 per share (“Earnout Parent Trading Price”). Should the Company elect to pay the earn-out consideration in cash, the amount will be determined by multiplying the number of shares payable by the Earnout Parent Trading Price. The fair value of any outstanding contingent consideration liabilities will be remeasured as of the end of each reporting period with any resulting remeasurement gains or losses recognized in the condensed consolidated statement of operations. The first and second tranche of this earn-out liability are both reflected in Contingent considerations in the condensed consolidated balance sheet as of March 31, 2024.

As of December 31, 2023, the Company finalized the opening net assets acquired and goodwill.

The fair value of inventory was calculated using the cost of goods sold to estimate the selling price. The selling price was adjusted for selling costs and a reasonable profit margin.

Developed technology relates to a primary product GEO held at the time of acquisition and was valued using Multi-Period Excess Earnings Method (“MPEEM”) approach, which estimates value based upon the present value of future economic benefits. This method determines the value of the specific intangible asset as the present value of ‘excess’ cash flows or income attributable to a specific intangible asset after an appropriate return for all other assets used in the operation of the

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corresponding business have been accounted for. The economic useful life was determined to be eight years based on the technology cycle, as well as the cash flows over the forecast period.

The fair value of IPR&D was determined using the replacement cost approach, which represents a systematic framework for estimating the value of intangible assets based upon the economic principle of substitution. If the development is abandoned in the future, these assets will be expensed in the period of abandonment. If and when the development activities are completed, IPR&D assets will be reclassified to developed technology, management will make a determination of the useful lives and methods of amortization of these assets.

Customer relationships represents the fair value of future projected revenue that will be derived from sales of products to existing customers of GEO. The fair value was determined by applying the distributor method, which is a variation of the MPEEM. The economic useful life was determined to be 12 years.

Backlog relates to various purchase orders in place with GEO’s customers at the time of the acquisition. The fair value was determined by applying the distributor method. The economic useful life was determined to be two years.

Trade name relates to the trade names held by GEO. The fair value was determined by applying the relief from royalty of the income approach. The selected royalty rate was determined based on an analysis of licensing agreements related to similar brand names. The economic useful life was determined to be eight years.

Under both the relief from royalty method and MPEEM, the fair value models incorporated estimates of future cash flows, estimates of allocations of certain assets and cash flows, estimates of future growth rates and management’s judgment regarding the applicable discount rates to use to discount such estimates of cash flows. Because the estimates and assumptions made by management at the time of the acquisitions are unobservable and significant to the overall fair value measurement of these acquired identifiable intangible assets, the corresponding fair values are classified as Level 3 fair value hierarchy measurements.

The amount of revenue of GEO included in the Company’s consolidated statement of operations from the acquisition date of March 3, 2023 through December 31, 2023 is $48,417. It is impracticable for the Company to disclose the net earnings of GEO included in the Company’s consolidated statement of operations from the acquisition date of March 3, 2023 through December 31, 2023 as the Company merged GEO into ADK LLC shortly after the acquisition such that the operating activities are comingled within ADK LLC.

The unaudited pro forma financial information shown below summarizes the combined results of operations for the Company and GEO as if the closing of the acquisition had occurred on January 1, 2023:

	Three months ended March 31, 2023
Combined revenue	$	44,122
Combined net loss before income taxes	$	(95,352)

The unaudited pro forma financial information includes adjustments that are directly attributable to the business combination and are factually supportable. Pro forma information reflects adjustments that are expected to have a continuing impact on the Company’s results of operations and are directly attributable to the acquisition. The unaudited pro forma results include adjustments to reflect, among other things, direct transaction costs relating to the acquisition, the incremental intangible asset amortization to be incurred based on the preliminary values of each identifiable intangible asset, and to eliminate a portion of the interest expense related to legacy GEO’s former loans, which were settled upon completion of the acquisition. The unaudited pro forma financial information is presented for illustrative purposes only and is not necessarily indicative of the operating results that would have been realized if the acquisition had taken place on January 1, 2023.

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Acquisition of Exalos AG

On September 18, 2023, Ay Dee Kay Ltd. completed its acquisition of Exalos AG, a Swiss corporation (“Exalos”), pursuant to that Share Sale and Purchase Agreement by and among Ay Dee Kay Ltd., the Company and all of the stockholders of Exalos, whereby Ay Dee Kay Ltd. acquired all of the outstanding common shares of Exalos. The closing consideration consisted of (i) approximately 6,613,786 shares of Class A common stock of the Company, with a fair value of $42,791, and (ii) a contingent consideration with fair value of $13,225 at closing, payable in cash or Class A common stock, subject to Exalos’ achievement of certain revenue-based milestones through September 30, 2025; and (iii) a holdback of $2,500 subject to final release 12 months from the acquisition date payable in shares of Class A common stock. The purchase price is subject to working capital and other adjustments as provided in the Share Sale and Purchase Agreement.

The Company paid a premium (i.e., goodwill) over the fair value of the net tangible and identified intangible assets acquired as this acquisition immediately expands the Company’s ADAS and User Experience product and technology offering to its global tier one and automotive OEM customer base. Specifically, indie can now leverage Exalos’ technology portfolio to extend its FMCW LiDAR portfolio. The goodwill is not expected to be deductible for tax purposes.

The Company incurred various acquisition-related costs, which were primarily legal expenses and recorded as part of the Selling, General and Administrative expenses. Total costs incurred were $621 during the year ended December 31, 2023. Total costs incurred are $195 for the three months ended March 31, 2024

The Company maintains an adjustment holdback for the purpose of providing security against any adjustment to the amounts at closing. The holdback period extends for twelve months from the closing date and will be paid in shares of Class A common stock.

Total purchase consideration transferred at closing also included contingent consideration that had a fair value of $13,225 as of the acquisition date. The acquisition date fair value of the contingent consideration was determined based on the Company’s assessment of the probability of achieving the performance targets that ultimately obligate the Company to transfer additional consideration to the seller. The contingent consideration is comprised of two tranches, both subject to Exalos achieving certain revenue targets. Both tranches are payable in cash or Class A common stock, at indie’s election, up to a maximum of $20,000, upon the achievement of a revenue threshold of $19,000 for the twelve-month period ending on September 30, 2024 and the achievement of a revenue threshold of $21,000 for the twelve-month period ending on September 30, 2025, respectively. The fair value of any outstanding contingent consideration liabilities will be remeasured as of the end of each reporting period with any resulting remeasurement gains or losses recognized in the condensed consolidated statement of operations. The first tranche of this earn-out liability is reflected in Contingent considerations and the second tranche is reflected in Other long-term liabilities in the condensed consolidated balance sheet as of March 31, 2024.

Pro forma financial information for Exalos is not disclosed as the results are not material to the Company’s condensed consolidated financial statements.

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Acquisition of Kinetic

On January 25, 2024 (“Deal Closing Date”), indie and ADK LLC completed its acquisition of Kinetic. The acquisition was consummated pursuant to an executed APA to acquire certain research and development personnel, intellectual property and business properties from Kinetic, in support of a custom product development for a North American electric vehicle OEM. The closing consideration consisted of (i) $3,200 in cash as the Initial Cash Consideration, net of an adjustment holdback amount of $500 and an indemnity holdback amount of $800, (ii) the Production Earnout with fair value of $2,348, payable in cash or Class A common stock, subject to achievement of certain production based milestones 24 months after the Deal Closing Date, and (iii) the Revenue Earnout with fair value of $2,251, payable in cash or Class A common stock, subject to achievement of certain revenue based milestones 12 months after the Deal Closing Date. The purchase price is subject to working capital and other adjustments as provided in the APA. The indemnity holdback amount is payable within five business days after the 18-month anniversary of the Deal Closing Date and is payable in shares of Class A common stock.

The Company paid a premium (i.e., goodwill) over the fair value of the net tangible and identified intangible assets acquired as this acquisition brings the Company a new family of smart connectivity solutions that enable high-speed networking of displays and controllers throughout the vehicle, which already generated interest from OEMs. The goodwill is expected to be deductible for tax purposes.

indie incurred various acquisition-related costs, which were primarily legal expense, and recorded these as part of the Selling, General and Administrative expenses. Total costs incurred are $145 for the three months ended March 31, 2024.

The Company maintains an adjustment holdback for the purpose of providing security against any adjustment to the amounts at closing. The holdback period extends for 18 months from the Deal Closing Date and will be paid in cash.

Total purchase consideration transferred at the Deal Closing Date also included contingent consideration that had a total fair value of $4,599 as of the acquisition date. The acquisition date fair value of the contingent considerations was determined based on the Company’s assessment of the probability of achieving the performance targets that ultimately obligate the Company to transfer additional consideration to the seller. The contingent consideration is comprised of two tranches and both are payable in cash or Class A common stock, at indie’s election. The Production Earnout pays up to a maximum of $3,000, upon fulfillment of certain production volume of a predetermined product within 24-month period ending on January 24, 2026. The Revenue Earnout pays up to a maximum of $2,500 upon the achievement of a minimum revenue threshold of $12,000 for the twelve-month period ending on January 24, 2025. The fair value of any outstanding contingent consideration liabilities will be remeasured as of the end of each reporting period with any resulting remeasurement gains or losses recognized in the condensed consolidated statement of operations. The Revenue Earnout is reflected in Contingent considerations and the Production Earnout is reflected in Other long-term liabilities in the condensed consolidated balance sheet as of March 31, 2024.

Pro forma financial information for Kinetic is not disclosed as the results are not material to the Company’s condensed consolidated financial statements.

3.    Inventory, Net

Inventory, net consists of the following:

	March 31, 2024		December 31, 2023
Raw materials	$	11,001	$	7,360
Work-in-process	12,222		12,423
Finished goods	17,282		15,896
Inventory, gross	40,505		35,679
Less: Inventory reserves	2,606		2,538
Inventory, net	$	37,899	$	33,141

During the three months ended March 31, 2024 and 2023, the Company recognized write-downs in the value of inventory of $262 and $31, respectively.

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4.    Property and Equipment, Net

Property and equipment, net consists of the following:

	Useful life (in years)	March 31, 2024		December 31, 2023
Production tooling	4	$	17,217	$	16,428
Lab equipment	4	13,453		12,887
Office equipment	3 - 7	8,493		6,539
Leasehold improvements	*	1,912		1,898
Construction in progress		4,395		3,867
Property and equipment, gross		45,470		41,619
Less: Accumulated depreciation		16,071		14,653
Property and equipment, net		$	29,399	$	26,966

*Leasehold improvements are amortized over the shorter of the remaining lease term or estimated useful life of the leasehold improvement.

The Company recognized depreciation expense of $1,485 and $955 for the three months ended March 31, 2024 and 2023, respectively.

Fixed assets not yet in service consist primarily of capitalized internal-use software and certain tooling and other equipment that have not been placed into service.

5.    Intangible Assets, Net

Intangible assets, net consist of the following:

	March 31, 2024							December 31, 2023
	Weighted Average Remaining Useful Life	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Remaining Useful Life	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Developed technology	6.0	$	106,966	$	(21,420)	$	85,546	6.3	$	106,512	$	(17,876)	$	88,636
Software licenses	0.7	23,874		(21,158)		2,716		1.0	23,745		(18,828)		4,917
Customer relationships	8.9	41,691		(5,998)		35,693		9.4	41,441		(5,156)		36,285
Intellectual property licenses	0.8	1,918		(1,736)		182		0.3	1,911		(1,736)		175
Trade names	5.8	26,067		(5,091)		20,976		6.0	25,970		(4,311)		21,659
Backlog	1.3	1,589		(821)		768		1.2	1,570		(700)		870
Effect of exchange rate on gross carrying amount		(3,539)				(3,539)			(917)		—		(917)
Intangible assets with finite lives		198,566		(56,224)		142,342			200,232		(48,607)		151,625
IPR&D		57,258		—		57,258			56,508		—		56,508
Effect of exchange rate on gross carrying amount		(965)		—		(965)			1		—		1
Total intangible assets with indefinite lives		56,293		—		56,293			56,509		—		56,509
Total intangible assets		$	254,859	$	(56,224)	$	198,635		$	256,741	$	(48,607)	$	208,134

The Company obtained software licenses, which it uses for its research and development efforts related to its products. In both fiscal 2024 and 2023, the Company acquired developed technology, customer relationships, trade names, backlog and IPR&D as a result of business combinations. See Note 2 — Business Combinations for additional information.

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Intangible assets with finite lives are amortized on a straight-line basis over the expected period to be benefited by future cash flows. The Company monitors and assesses these assets for impairment on a periodic basis.

Amortization of intangible assets for the three months ended March 31, 2024 and 2023 was $8,066 and $5,080, respectively, and is included within Cost of goods sold, Research and development expenses, and Selling, general and administrative expenses based their respective nature, in the condensed consolidated statements of operations.

Based on the amount of definite-lived intangible assets subject to amortization as of March 31, 2024, amortization expense for each of the next five fiscal years is expected to be as follows:

2024 (remaining 9 months)	$	19,509
2025	23,197
2026	21,171
2027	18,187
2028	17,932
Thereafter	42,346
Total	$	142,342

6.    Goodwill

The following table sets forth the carrying amount and activity of goodwill as of March 31, 2024:

	Amount
Balance as of Balance as of the beginning of the period	$	295,096
Acquisitions (Note 2)	664
Effect of exchange rate on goodwill	(5,363)
Balance as of Balance as of the end of the period	$	290,397

The change in goodwill is primarily driven by $664 increase during the three months ended March 31, 2024 due to acquisition of Kinetic that was completed during the period, as well as a $5,363 decrease in value due to the effect of exchange rate on goodwill. See Note 2 — Business Combinations for a detailed discussion of goodwill acquired.

The Company tests its goodwill for impairment annually as of the first day of its fourth fiscal quarter and in interim periods if certain events occur indicating the carrying value of goodwill may be impaired. There were no indicators of impairment noted during the three months ended March 31, 2024.

7.    Debt

The following table sets forth the components of debt as of March 31, 2024 and December 31, 2023:

	March 31, 2024						December 31, 2023
	Principal Outstanding		Unamortized Discount and Issuance Cost		Carrying Amount		Principal Outstanding		Unamortized Discount and Issuance Cost		Carrying Amount
2027 Notes	$	160,000	$	(4,038)	$	155,962	$	160,000	$	(4,288)	$	155,712
CIBC loan, due 2026	3,543		(11)		3,532		3,971		(13)		3,958
Total term loans