Leases

9 Months Ended

Sep. 30, 2023

7. Leases

We account for leases in accordance with ASC Topic 842: Leases.

We enter into lease agreements for the use of real estate space and certain equipment under operating leases and we have no financing leases. Our leases are included in “Right-of-use-assets” and “Lease liabilities” in our Condensed Consolidated Balance Sheets. Our leases have various lease terms, some of which include options to extend. Lease expense is recognized on a straight-line basis over the lease term.

Operating lease expense for the nine months ended September 30, 2023 and 2022 was $742 thousand and $748 thousand, respectively, and is reported as “Cost of sales”, “Engineering, design and product development expense”, “Selling and marketing expense”, and “General and administrative expense” in the Condensed Consolidated Statements of Operations. Operating lease expenses include short-term lease costs, which were immaterial during the periods presented.

The following information represents supplemental disclosure for the statement of cash flows related to operating leases (in thousands):

	Nine Months Ended
	September 30,
	2023		2022
Operating cash outflows from leases	$	756	$	617

The following summarizes additional information related to our leases as of September 30, 2023 and December 31, 2022:

	September 30, 2023			December 31, 2022
Weighted average remaining lease term (in years)		2.0			2.7
Weighted average discount rate		4.5	%		4.5	%

The maturity of the Company’s operating lease liabilities as of September 30, 2023 and December 31, 2022 were as follows (in thousands):

	September 30, 2023		December 31, 2022
2023		216		972
2024		1,022		1,022
2025		711		710
2026		21		20
Total undiscounted lease payments		1,970		2,724
Less imputed interest		90		166
Total lease liabilities	$	1,880	$	2,558