8.
Leases

On December 11, 2025, the Company entered into lease amendments for its corporate office and warehouse leases, which amended the previous lease agreements, whereby the Company leases office space from the landlords with lease terms ending January 31, 2027. Pursuant to the lease amendments, the lease term was extended one year, expiring January 31, 2028.

The Company’s ROU asset relates to its leased corporate offices and warehouse in Sunnyvale, CA. Supplemental balance sheet information related to leases was as follows (in thousands):

 

 

 

December 31,

 

 

December 31,

 

 

 

2025

 

 

2024

 

Operating Lease

 

 

 

 

 

 

Operating lease right-of-use asset

 

$

2,296

 

 

$

2,132

 

 

 

 

 

 

 

 

Operating lease liability, current

 

 

1,105

 

 

 

1,088

 

Operating lease liability, long-term

 

 

1,360

 

 

 

1,314

 

Total operating lease liabilities

 

$

2,465

 

 

$

2,402

 

Weighted average remaining lease term (years)

 

 

2.1

 

 

2.1

 

Weighted average remaining discount rate

 

 

8.00

%

 

 

7.24

%

 

A summary of total lease expense and other information for the periods relating to the Company’s operating leases was as follows:

 

 

 

December 31,

 

 

December 31,

 

 

 

2025

 

 

2024

 

Operating lease expense

 

$

1,136

 

 

$

983

 

Variable lease expense

 

 

332

 

 

 

304

 

Total lease expense

 

$

1,468

 

 

$

1,287

 

 

 

 

 

 

 

 

Total cash payments for amounts included in the measurement of lease liabilities

 

$

1,216

 

 

$

911

 

 

The Company leases office space and warehouse space under non-cancelable operating leases. As of December 31, 2025, the future minimum lease payments under the non-cancelable operating lease are as follows (in thousands):

 

 

 

December 31,

 

Operating Leases:

 

2025

 

2026

 

$

1,254

 

2027

 

 

1,306

 

2028

 

 

109

 

Total undiscounted lease payments

 

 

2,669

 

Imputed interest

 

 

(204

)

Net Lease Liabilities

 

$

2,465

 

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.