Stock-Based Compensation

3 Months Ended

Mar. 31, 2023

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

Note 8. Stock-Based Compensation

Shares of common stock reserved for issuance under the Company’s equity incentive plans were as follows:

	March 31, 2023
Outstanding stock awards		9,971,919
Reserved for future award grants		2,748,592
Reserved for future ESPP		1,082,950
Total common stock reserved for stock awards		13,803,461

Stock Option Activity

A summary of the Company’s stock option activity (excluding performance-based stock option activity summarized further below) under the 2011 Plan, 2019 Plan, and Inducement Plan for the three months ended March 31, 2023 is as follows:

	Outstanding Options
(in thousands, except share and per share data)	Number of Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Balance—December 31, 2022		5,451,132		$	9.90		5.31	$	7
Options granted		2,076,000			2.76
Options exercised		—			—
Options forfeited or expired		(173,221	)		12.67
Balance—March 31, 2023		7,353,911		$	7.82		6.26	$	202
Options vested and exercisable as of March 31, 2023		3,871,448		$	9.19		3.37	$	177

The weighted-average grant date fair value of options granted was $1.91 and $6.59 per share for the three months ended March 31, 2023 and 2022, respectively. As of March 31, 2023, the unrecognized stock-based compensation cost of unvested options was $11.6 million, which is expected to be recognized over a weighted-average period of 2.6 years.

Valuation of Stock Options

The Company estimated the fair value of stock options (excluding performance-based stock options discussed below) using the Black-Scholes option-pricing model. The fair value of stock options is recognized on a straight-line basis over the requisite service periods of the awards. The fair value of stock options was estimated using the following weighted-average assumptions:

	Three Months Ended March 31,
	2023	2022
Expected term (in years)	5.77	6.00 - 6.08
Volatility	78.98%	68.37 - 69.10%
Risk-free interest rate	3.58%	1.62 - 2.13%
Dividend yield	–%	–%

Performance-Based Stock Option Activity

No performance-based stock option activity occurred during the three months ended March 31, 2023. As of March 31, 2023, performance-based stock options for 421,000 shares with an exercise price of $5.10 and a remaining contractual term of 0.75 years remained outstanding. The stock options are fully vested and exercisable and had no intrinsic value as of March 31, 2023.

Restricted Stock Units ("RSU") Activity and Valuation

A summary of the Company’s RSU activity under the 2019 Plan and Inducement Plan for the three months ended March 31, 2023 is as follows:

	Unvested Restricted Stock Units
(in thousands, except share and per share data)	Number of Shares			Weighted- Average Grant Date Fair Value		Aggregate Fair Value
Balance—December 31, 2022		2,621,482		$	9.33	$	5,191
RSUs granted		—			—
RSUs vested		(67,406	)		18.77		184
RSUs forfeited		(357,068	)		8.13
Balance—March 31, 2023		2,197,008		$	9.23	$	6,064

As of March 31, 2023, the unrecognized stock-based compensation cost of unvested RSUs was $16.9 million, which is expected to be recognized over a weighted-average period of 2.4 years.

ESPP Activity and Valuation

During the three months ended March 31, 2023 and 2022, no shares of common stock were purchased under the ESPP. Additionally, no stock purchase rights were granted during either period.

Stock-Based Compensation Expense

The following is a summary of stock-based compensation expense by award type (in thousands):

	Three Months Ended March 31,
	2023		2022
Stock options	$	1,343	$	2,396
RSUs		2,123		2,168
ESPP		229		252
Total stock-based compensation expense	$	3,695	$	4,816

The following is a summary of stock-based compensation expense by function (in thousands):

	Three Months Ended March 31,
	2023		2022
Cost of revenue	$	490	$	458
Research and development		1,245		1,341
Selling, general and administrative		1,960		3,017
Total stock-based compensation expense	$	3,695	$	4,816