Segment Information

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Segment Information

11. Segment Information

The Company operates and reports its results in two business segments, Product and Software. The Company reports segment information based on the management approach. The management approach designates the internal reporting used by the Company's chief operating decision maker ("CODM") for decision making and performance assessment as the basis for determining the Company’s reportable segments. The performance measures of the Company’s reportable segments are primarily income (loss) from operations. Income (loss) from operations for each segment includes all revenues, related cost of net revenues, gross margin and operating expenses directly attributable to the segment.

The Company’s Product segment includes sales of the Company's GentleWave System console and related accessories and instruments.

The Company’s Software segment includes sales of the Company's traditional software licenses for practice management software to enable an integrated digital office for endodontists.

The following tables present the Company’s segment information as of and for the years ended December 31, 2022 and 2021:

	2022									2021
	(in thousands, except percentage data)
	Product			Software			Total			Product			Software			Total
Revenue	$	33,280		$	8,376		$	41,656		$	25,811		$	7,386		$	33,197
Cost of sales		28,193			2,983			31,176			21,992			2,869			24,861
Gross profit		5,087			5,393			10,480			3,819			4,517			8,336
Gross margin		15	%		64	%		25	%		15	%		61	%		25	%
Operating expenses:
Selling, general and administrative		49,859			2,047			51,906			31,781			2,132			33,913
Research and development		15,002			1,774			16,776			16,959			1,609			18,568
Change in fair value of contingent earnout		—			—			—			261			—			261
Total operating expenses		64,861			3,821			68,682			49,001			3,741			52,742
Income (loss) from operations	$	(59,774	)	$	1,572		$	(58,202	)	$	(45,182	)	$	776		$	(44,406	)

Depreciation:

	2022		2021
	(in thousands)
Product	$	1,032	$	1,409
Software		20		17
Total	$	1,052	$	1,426

Segment Assets:

	2022		2021
	(in thousands)
Product	$	125,713	$	104,588
Software		11,572		10,911
Total	$	137,285	$	115,499