INVENTORY

Our inventory primarily consists of component parts as well as work-in-progress and finished goods. The cost of inventory includes cost of materials, labor, overhead and freight. The inventory is stated at the lower of cost or net realizable value and accounted for using the FIFO method.

There was no material impairment of our inventory for the three and six months ended June 30, 2018 and 2017.

We recorded an immaterial impairment charge of approximately $1.8 million in our Games segment for the three and six months ended June 30, 2018 to reduce the carrying value of certain component parts to their fair values. The adjustment was included in operating expenses in our Statements of Income (Loss).

Inventory consisted of the following (in thousands):

	At June 30,		At December 31,
	2018		2017
Inventory
Component parts, net of reserves of $1,563 and $1,327 at June 30, 2018 and December 31, 2017, respectively	$	18,598	$	18,782
Work-in-progress		1,389		985
Finished goods		3,540		4,200
Total inventory	$	23,527	$	23,967