NOTE 4—Significant Balance Sheet Components

Inventory consisted of the following:

 Schedule of Inventory

The Company purchases raw materials in bulk to obtain a lower price. The raw materials are resold to third-party manufacturers at the Company’s cost.

Distributor returns allowance

The Company records reductions to revenue related to future distributor product returns based on the Company’s expectation. The Company had inventory related to distributor product returns totaling approximately $4 and $4, respectively, as of December 31, 2023 and 2022.

Prepaid expenses and other current assets consisted of the following:

 Schedule of Prepaid Expenses and Other Current Assets

Property and equipment consisted of the following:

 Schedule of Property and Equipment

Depreciation and amortization expense of property and equipment for the years ended December 31, 2023 and 2022, was $47 and $244, respectively. During 2022, the Company retired or disposed of computer equipment, software, and leasehold improvements with a cost of $4,751 and accumulated depreciation of $4,621 as the Company stopped manufacturing in 2022 and two U.S. leases were terminated. The Company recorded a loss on the disposal of assets of $130 on these disposals that is included in Other Expense, Net, in the Consolidated Statements of Operations.

Contract fulfillment assets are capitalized costs to test and obtain certification for cell phones and data devices with specific carriers. These costs are amortized over the estimated life of the device, which is four years. Contract fulfillment assets for the years ended December 31, 2023 and 2022 are $9,232 and $6,848 respectively. Amortization of contract fulfillment assets for the years ended December 31, 2023 and 2022 was $2,159 and $1,733, respectively.

Other assets consisted of the following:

Schedule of Other Assets 

Accrued liabilities consisted of the following:

 Schedule of Accrued Expenses

The table below sets forth the activity in the warranty liability, which is included in Accrued Liabilities on the Consolidated Balance Sheets:

 Schedule of Warrant Liability Included in Accrued Expenses on Consolidated Balance Sheet