Business Description and Significant Accounting Policies (Policies)	12 Months Ended
Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Principles of Consolidation	Principles of Consolidation The Consolidated Financial Statements include the accounts of Oblong and our 100%-owned subsidiaries (i) GP Communications, LLC (“GP Communications”), whose business function is to provide interstate telecommunications services for regulatory purposes, and (ii) Oblong Industries, Inc. All inter-company balances and transactions have been eliminated in consolidation. The U.S. Dollar is the functional currency for all subsidiaries. During 2022, the Company ceased operations through Oblong Industries’ 100%-owned subsidiaries (i) Oblong Industries Europe, S.L. and (ii) Oblong Europe Limited, and combined the operations into Oblong Industries, Inc. There was no activity in either subsidiary in 2022 and, as of December 31, 2022, Oblong Industries Europe, S.L. has been dissolved and Oblong Europe, Limited is in liquidation.
Segments	Segments Effective October 1, 2019, the former businesses of Glowpoint (now Oblong, Inc.) and Oblong Industries have been managed separately, and involve different products and services. Accordingly, the Company currently operates in two segments for purposes of segment reporting: (1) “Collaboration Products” which represents the Oblong Industries business surrounding our Mezzanine™ product offerings and (2) “Managed Services” which represents the Oblong (formerly Glowpoint) business surrounding managed services for video collaboration and network solutions. See Note 14 - Segment Reporting for further discussion.
Use of Estimates	Use of Estimates Preparation of the Consolidated Financial Statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates made. We continually evaluate estimates used in the preparation of our Consolidated Financial Statements for reasonableness. Appropriate adjustments, if any, to the estimates used are made prospectively based upon such periodic evaluation. The significant areas of estimation include determining the allowance for doubtful accounts, the estimated lives and recoverability of property and equipment and intangible assets, the inputs used in the valuation of goodwill and intangible assets in connection with our impairment tests, and the inputs used in the fair value of equity based awards.
Cash and Restricted cash	Cash and Restricted Cash As of December 31, 2022, our total cash balance was $3,085,000, and all cash was unrestricted. As of December 31, 2021, our total cash balance of $9,000,000 included current restricted cash of $61,000. The restricted cash pertained to one letter of credit that served as the security deposit for our leased office space in Boston, Massachusetts, and was secured by an equal amount of cash pledged as collateral, and such cash was held in a restricted bank account. The Boston lease, and thereby the letter of credit, in the amount of $61,000, expired in February 2022 and the cash was released.
Accounts Receivable and Provision for Estimated Credit Losses	Accounts Receivable and Provision for Estimated Credit Losses Accounts receivable are customer obligations due under normal trade terms. The Company sells its Managed Services products to end-users, and its Collaboration products to both resell partners and end-users. The Company extends credit to its customers based on their credit worthiness and on historical data, and performs ongoing credit evaluations of our customers’ financial condition. The Company maintains an allowance for doubtful accounts, related to accounts receivable, for future expected bad debt resulting from the inability or unwillingness of our customers to make required payments. We estimate our allowance for doubtful accounts based on relevant information such as historical experience, current economic conditions, and future expectations of specifically identified customer balances. This allowance is adjusted as appropriate to reflect current conditions. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. We do not obtain collateral from our customers to secure accounts receivable.
Employee Retention Credit	Employee Retention CreditThe CARES Act provided an employee retention credit (“ERC”), which was a refundable tax credit against certain payroll taxes. Upon determination that the Company had complied with all of the conditions required to receive the credit, the Company qualified and filed to claim the ERC. The Company reflected the ERC as a reduction to the respective captions on the consolidated statements of operations associated with the employees to which the payroll tax benefit related
Inventory	Inventory Inventory consists of finished goods and was determined using average costs and was stated at the lower of cost or net realizable value. The Company periodically performs analyses to identify obsolete or slow-moving inventory. Casualty Loss In June 2022, the Company discovered that $533,000 of inventory was stolen from the Company’s warehouse in City of Industry, California. The theft is being investigated further by the Los Angeles, CA Sheriff’s Department and claims have been filed with the Company’s insurance carriers. During 2022, we received a recovery payment from one of our insurance policies of $50,000, resulting in a net casualty loss of $483,000 on our Consolidated Statement of Operations. In February 2023, we received notification from our other insurance carrier that they determined the Company was entitled to insurance proceeds of $315,000 relating to our inventory theft claim. The Company is currently in negotiations with the insurance carrier with the objective of increasing their determination of insurance proceeds. We will offset the casualty loss with the recognition of any proceeds once received from our insurance carrier.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company considers its cash, accounts receivable, accounts payable and lease obligations to meet the definition of financial instruments. The carrying amount of cash, accounts receivable and accounts payable approximated their fair value due to the short maturities of these instruments. The carrying amounts of our lease obligations (see Note 9 - Operating Lease Liabilities and Right-of-Use Assets ) approximated their fair values, which were based on borrowing rates that were available to the Company for loans with similar terms, collateral, and maturity. The Company measures fair value as required by Accounting Standards Codification (“ASC”) Topic 820“Fair Value Measurements and Disclosures” (“ASC Topic 820”). ASC Topic 820 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. ASC Topic 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, there exists a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: •Level 1 - unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. •Level 2 - inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. •Level 3 - unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.
Revenue Recognition and Taxes Billed to Customers and Remitted to Taxing Authorities	Revenue Recognition The Company accounts for revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606. The Company recognizes revenue using the five-step model as prescribed by Topic 606: •Identification of the contract, or contracts, with a customer; •Identification of the distinct performance obligations in the contract; •Determination of the transaction price; •Allocation of the transaction price to the performance obligations in the contract; and •Recognition of revenue when or as the Company satisfies a performance obligation. The Company’s managed videoconferencing services are offered to our customers on either a usage basis or on a subscription. Our network services are offered to our customers on a subscription basis. Revenue for these services is generally recognized on a monthly basis as services are performed. Revenue related to professional services is recognized at the time the services are performed. The costs associated with obtaining a customer contract were previously expensed in the period they were incurred. Under Topic 606, these payments are deferred on our consolidated balance sheets and amortized over the expected life of the customer contract. Deferred revenue as of December 31, 2022 totaled $1,000 as certain performance obligations were not satisfied as of this date. During the year ended December 31, 2022, the Company recorded $7,000 of revenue that was included in deferred revenue as of December 31, 2021. During the year ended December 31, 2021, the Company recorded $24,000 of revenue that was included in deferred revenue as of December 31, 2020. The Company’s visual collaboration products are composed of hardware and embedded software sold as a complete package, and generally include installation and maintenance services. Revenue for hardware and software is recognized upon shipment to the customer. Installation revenue is recognized upon completion of installation, which also triggers the beginning of recognition of revenue for maintenance services which range from one to three years. Revenue is recognized over time for maintenance services. Professional services are contracts with specific customers for software development, visual design, interaction design, engineering, and project support. These contracts vary in length, and revenue is recognized over time as services are rendered. Licensing agreements are for the Company’s core technology platform, g-speak, and are generally one year in length. Revenue for these services is recognized ratably over the service period. Deferred revenue, as of December 31, 2022, totaled $549,000 as certain performance obligations were not satisfied as of this date. During the year ended December 31, 2022, the Company recorded $776,000 of revenue that was included in deferred revenue as of December 31, 2021. During the year ended December 31, 2021, the Company recorded $1,193,000 of revenue that was included in deferred revenue as of December 31, 2020. Revenue recorded over time for the years ended December 31, 2022 and 2021 was $970,000 and $1,809,000, respectively. Revenue recorded at a period in time for the years ended December 31, 2022 and 2021 was $4,506,000 and $5,930,000, respectively. The Company disaggregates its revenue by geographic region. See Note 14 - Segment Reporting for more information. Taxes Billed to Customers and Remitted to Taxing Authorities We recognize taxes billed to customers in revenue and taxes remitted to taxing authorities in our cost of revenue.
Long-Lived Assets, Goodwill and Intangible Assets	Long-Lived Assets, Goodwill, and Intangible Assets Property and Equipment Property and equipment are accounted for in accordance with ASC Topic 360 “Property, Plant, and Equipment” (“ASC Topic 360”), stated at cost, and are depreciated using the straight-line method over the estimated economic lives of the assets, which range from three to ten years. Leasehold improvements are amortized over the shorter of either the asset’s useful life or the related lease term. Depreciation is computed on the straight-line method for financial reporting purposes. Property and equipment assets, net of accumulated depreciation, totaled $3,000 and $159,000 as of December 31, 2022 and 2021, respectively. Intangible Assets Intangible assets are accounted for in accordance with ASC Topic 350 “Intangibles - Goodwill and Other” (“ASC Topic 350”), and intangible assets with finite lives are amortized using the straight-line method over the estimated economic lives of the assets, which initially ranged from five to twelve years. Intangible assets, net of accumulated amortization totaled $604,000 and $7,562,000 as of December 31, 2022 and 2021, respectively. Goodwill Goodwill is accounted for in accordance with ASC Topic 350 and is not amortized. Goodwill is subject to periodic testing for impairment. As of December 31, 2021, goodwill of $7,367,000 was recorded on our Consolidated Balance Sheet in connection with the October 1, 2019 acquisition of Oblong Industries. As a result of the impairment charges discussed below, there was no goodwill recorded on our Consolidated Balance Sheet as of December 31, 2022. Operating Lease Right-of-use-assets Right-of-use Assets are accounted for in accordance with ASC Topic 842 “Leases” (“ASC Topic 842”), and are amortized using a straight-line method over the estimated life of the lease. Right-of-use assets, net totaled $142,000 and $659,000, as of December 31, 2022 and 2021, respectively. The Company primarily leases facilities for office, warehouse, and data center space under non-cancellable operating leases for its U.S. locations, and accounts for these leases in accordance with ASC-842. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the expected lease term. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Since our lease arrangements do not provide an implicit rate, we use our estimated incremental borrowing rate for the expected remaining lease term at commencement date in determining the present value of future lease payments. Impairment The Company assesses the impairment of our long-lived assets subject to amortization when events and circumstances indicate that the carrying value of the assets might not be recoverable. The determination of related estimated useful lives and whether or not these assets are impaired involves significant judgments, related primarily to the future profitability and/or future value of the assets. Changes in the Company’s strategic plan and/or other-than-temporary changes in market conditions could significantly impact these judgments and could require adjustments to recorded asset balances. Long-lived assets are evaluated for impairment whenever an event or change in circumstances has occurred that could have a significant adverse effect on the fair value of long-lived assets. During the year ended December 31, 2022, we considered the declines in revenue for the Collaboration Products reporting segment and the decline in the Company’s market capitalization to be triggering events for an impairment test of our long-lived and intangible for this reporting unit. Based on the corresponding recoverability tests of the asset group for this reporting unit, it was determined that the carrying value exceeded the gross cash flows of the asset group. The recoverability tests consisted of comparing the estimated undiscounted cash flows expected to be generated by those assets to the respective carrying amounts, and involves significant judgements and assumptions, related primarily to the future revenue and profitability of the assets. For the year ended December 31, 2022, the Company recorded net impairment charges on property and equipment assets of $59,000. See Note 5 - Property and Equipment for further discussion. During the year ended December 31, 2021, the Company recorded impairment charges of $98,000 on property and equipment assets. For the year ended December 31, 2022, the Company recorded impairment charges of $5,133,000 on purchased intangible assets. See Note 7 - Intangible Assets for further discussion. The Company recorded impairment Charges of $207,000 to purchased intangible assets for the year ended December 31, 2021. We tested goodwill for impairment on an annual basis, on September 30th of each year, unless events occurred or circumstances changed indicating that the fair value of the goodwill may be below its carrying amount. During the year ended December 31, 2022, we considered the sustained decline in our stock price to be a triggering event for an interim goodwill impairment test, as of both March 31, 2022 and June 30, 2022. To determine the fair value of the reporting unit for the goodwill impairment test, we used a weighted average of the discounted cash flow method and market-based method. During the year ended December 31, 2022, we recorded impairment charges of $7,367,000, related to the tests discussed above. See Note 6 - Goodwill for further discussion. No impairments were recorded for Goodwill during the year ended December 31, 2021. Right-of-use assets are tested for impairment using guidance from ASC Topic 360. For the year ended December 31, 2022, the Company recorded aggregate impairment charges of $179,000 on two right-of-use assets. See Note 9 - Operating Lease Liabilities and Right-of-Use Assets for further discussion. There were no right-of-use asset impairments for the year ended December 31, 2021.
Operating Leases	Operating Leases Operating leases are accounted for in accordance with ASC Topic 842 “Leases” (“ASC Topic 842”), and the liabilities are amortized using a straight-line method over the estimated life of the lease. The remaining operating lease liability as of December 31, 2022 and 2021 was $236,000 and $728,000, respectively. See Note 9 - Operating Lease Liabilities and Right-of-Use Assets for further discussion. Operating lease expense is recognized on a straight-line basis over the lease term. Variable lease payments are not included in the lease payments to measure the lease liability and are expensed as incurred. The Company’s leases have remaining terms of one to fourteen months and some of the leases include a Company option to extend the lease term for less than twelve months to five years, or more, which if reasonably certain to exercise, the Company includes in the determination of lease payments. The lease agreements do not contain any material residual value guarantees or material restrictive covenants. Leases with an initial term of 12 months or less, with the exception of leases for real property, are not recognized on the balance sheet and the expense for these short-term leases is recognized on a straight-line basis over the lease term. Common area maintenance fees (or CAMs) and other charges related to leases are expensed as incurred.
Concentration of Credit Risk	Concentration of Credit RiskFinancial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and trade accounts receivable. We place our cash needed for operations in commercial checking accounts, and the majority of our cash is held in a money market fund. Commercial bank balances may from time to time exceed federal insurance limits. Deposits are insured by the Federal Deposit Insurance Corporation (the “FDIC”) in an amount up to $250,000 for any depositor, any deposit in excess of this insured amount could be lost.
Income Taxes	Income Taxes We use the asset and liability method to determine our income tax expense or benefit. Deferred tax assets and liabilities are computed based on temporary differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates that are expected to be in effect when the differences are expected to be recovered or settled. Any resulting net deferred tax assets are evaluated for recoverability and, accordingly, a valuation allowance is provided when it is more likely than not that all or some portion of the deferred tax asset will not be realized.
Stock-based Compensation	Stock-based Compensation Stock-based awards have been accounted for as required by ASC Topic 718 “Compensation – Stock Compensation” (“ASC Topic 718”). Under ASC Topic 718 stock-based awards are valued at fair value on the date of grant, and that fair value is recognized over the requisite service period. The Company accounts for forfeitures when they occur.
Research and Development	Research and Development Research and development expenses include internal and external costs related to developing new service offerings and features and enhancements to our existing product offerings.
Treasury Stock	Treasury StockPurchases and sales of treasury stock are accounted for using the cost method. Under this method, shares acquired are recorded at the acquisition price directly to the treasury stock account. Upon sale, the treasury stock account is reduced by the original acquisition price of the shares and any difference is recorded in additional paid in capital, on a first-in first-out basis. The Company does not recognize a gain or loss to income from the purchase and sale of treasury stock.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Recently Issued Accounting Pronouncements There are no new accounting pronouncements that are expected to have a significant impact on financial statements. In June 2016 the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326),” which was subsequently amended in February 2020 by ASU 2020-02, “Financial Instruments - Credit Losses (Topic 326) and Leases (Topic 842).” The amendments introduce an impairment model that is based on expected credit losses, rather than incurred losses, to estimate credit losses on certain types of financial instruments (e.g., loans and held-to-maturity securities), including certain off-balance sheet financial instruments (e.g., loan commitments). The expected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments, over the contractual term. Financial instruments with similar risk characteristics may be grouped together when estimating expected credit losses. The update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted the new guidance, as of January 1, 2023, and it did not have a material impact on the Consolidated Financial Statements.

Business Description and Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

The Consolidated Financial Statements include the accounts of Oblong and our 100%-owned subsidiaries (i) GP Communications, LLC (“GP Communications”), whose business function is to provide interstate telecommunications services for regulatory purposes, and (ii) Oblong Industries, Inc. All inter-company balances and transactions have been eliminated in consolidation. The U.S. Dollar is the functional currency for all subsidiaries.

During 2022, the Company ceased operations through Oblong Industries’ 100%-owned subsidiaries (i) Oblong Industries Europe, S.L. and (ii) Oblong Europe Limited, and combined the operations into Oblong Industries, Inc. There was no activity in either subsidiary in 2022 and, as of December 31, 2022, Oblong Industries Europe, S.L. has been dissolved and Oblong Europe, Limited is in liquidation.

Segments

Effective October 1, 2019, the former businesses of Glowpoint (now Oblong, Inc.) and Oblong Industries have been managed separately, and involve different products and services. Accordingly, the Company currently operates in two segments for purposes of segment reporting: (1) “Collaboration Products” which represents the Oblong Industries business surrounding our Mezzanine™ product offerings and (2) “Managed Services” which represents the Oblong (formerly Glowpoint) business surrounding managed services for video collaboration and network solutions. See Note 14 - Segment Reporting for further discussion.

Use of Estimates

Preparation of the Consolidated Financial Statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates made. We continually evaluate estimates used in the preparation of our Consolidated Financial Statements for reasonableness. Appropriate adjustments, if any, to the estimates used are made prospectively based upon such periodic evaluation. The significant areas of estimation include determining the allowance for doubtful accounts, the estimated lives and recoverability of property and equipment and intangible assets, the inputs used in the valuation of goodwill and intangible assets in connection with our impairment tests, and the inputs used in the fair value of equity based awards.

Cash and Restricted cash

Cash and Restricted Cash

As of December 31, 2022, our total cash balance was $3,085,000, and all cash was unrestricted. As of December 31, 2021, our total cash balance of $9,000,000 included current restricted cash of $61,000. The restricted cash pertained to one letter of credit that served as the security deposit for our leased office space in Boston, Massachusetts, and was secured by an equal amount of cash pledged as collateral, and such cash was held in a restricted bank account. The Boston lease, and thereby the letter of credit, in the amount of $61,000, expired in February 2022 and the cash was released.

Accounts Receivable and Provision for Estimated Credit Losses

Accounts receivable are customer obligations due under normal trade terms. The Company sells its Managed Services products to end-users, and its Collaboration products to both resell partners and end-users. The Company extends credit to its customers based on their credit worthiness and on historical data, and performs ongoing credit evaluations of our customers’

financial condition. The Company maintains an allowance for doubtful accounts, related to accounts receivable, for future expected bad debt resulting from the inability or unwillingness of our customers to make required payments. We estimate our allowance for doubtful accounts based on relevant information such as historical experience, current economic conditions, and future expectations of specifically identified customer balances. This allowance is adjusted as appropriate to reflect current conditions. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. We do not obtain collateral from our customers to secure accounts receivable.

Employee Retention Credit

Employee Retention CreditThe CARES Act provided an employee retention credit (“ERC”), which was a refundable tax credit against certain payroll taxes. Upon determination that the Company had complied with all of the conditions required to receive the credit, the Company qualified and filed to claim the ERC. The Company reflected the ERC as a reduction to the respective captions on the consolidated statements of operations associated with the employees to which the payroll tax benefit related

Inventory

Inventory consists of finished goods and was determined using average costs and was stated at the lower of cost or net realizable value. The Company periodically performs analyses to identify obsolete or slow-moving inventory.

Casualty Loss

In June 2022, the Company discovered that $533,000 of inventory was stolen from the Company’s warehouse in City of Industry, California. The theft is being investigated further by the Los Angeles, CA Sheriff’s Department and claims have been filed with the Company’s insurance carriers. During 2022, we received a recovery payment from one of our insurance policies of $50,000, resulting in a net casualty loss of $483,000 on our Consolidated Statement of Operations. In February 2023, we received notification from our other insurance carrier that they determined the Company was entitled to insurance proceeds of $315,000 relating to our inventory theft claim. The Company is currently in negotiations with the insurance carrier with the objective of increasing their determination of insurance proceeds. We will offset the casualty loss with the recognition of any proceeds once received from our insurance carrier.

Fair Value of Financial Instruments

The Company considers its cash, accounts receivable, accounts payable and lease obligations to meet the definition of financial instruments. The carrying amount of cash, accounts receivable and accounts payable approximated their fair value due to the short maturities of these instruments. The carrying amounts of our lease obligations (see Note 9 - Operating Lease Liabilities and Right-of-Use Assets ) approximated their fair values, which were based on borrowing rates that were available to the Company for loans with similar terms, collateral, and maturity.

The Company measures fair value as required by Accounting Standards Codification (“ASC”) Topic 820“Fair Value Measurements and Disclosures” (“ASC Topic 820”). ASC Topic 820 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. ASC Topic 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, there exists a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

•Level 1 - unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.

•Level 2 - inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.

•Level 3 - unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date.

This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

Revenue Recognition and Taxes Billed to Customers and Remitted to Taxing Authorities

Revenue Recognition

The Company accounts for revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606.

The Company recognizes revenue using the five-step model as prescribed by Topic 606:

•Identification of the contract, or contracts, with a customer;

•Identification of the distinct performance obligations in the contract;

•Determination of the transaction price;

•Allocation of the transaction price to the performance obligations in the contract; and

•Recognition of revenue when or as the Company satisfies a performance obligation.

The Company’s managed videoconferencing services are offered to our customers on either a usage basis or on a subscription. Our network services are offered to our customers on a subscription basis. Revenue for these services is generally recognized on a monthly basis as services are performed. Revenue related to professional services is recognized at the time the services are performed. The costs associated with obtaining a customer contract were previously expensed in the period they were incurred. Under Topic 606, these payments are deferred on our consolidated balance sheets and amortized over the expected life of the customer contract. Deferred revenue as of December 31, 2022 totaled $1,000 as certain performance obligations were not satisfied as of this date. During the year ended December 31, 2022, the Company recorded $7,000 of revenue that was included in deferred revenue as of December 31, 2021. During the year ended December 31, 2021, the Company recorded $24,000 of revenue that was included in deferred revenue as of December 31, 2020.

The Company’s visual collaboration products are composed of hardware and embedded software sold as a complete package, and generally include installation and maintenance services. Revenue for hardware and software is recognized upon shipment to the customer. Installation revenue is recognized upon completion of installation, which also triggers the beginning of recognition of revenue for maintenance services which range from one to three years. Revenue is recognized over time for maintenance services. Professional services are contracts with specific customers for software development, visual design, interaction design, engineering, and project support. These contracts vary in length, and revenue is recognized over time as services are rendered. Licensing agreements are for the Company’s core technology platform, g-speak, and are generally one year in length. Revenue for these services is recognized ratably over the service period. Deferred revenue, as of December 31, 2022, totaled $549,000 as certain performance obligations were not satisfied as of this date. During the year ended December 31, 2022, the Company recorded $776,000 of revenue that was included in deferred revenue as of December 31, 2021. During the year ended December 31, 2021, the Company recorded $1,193,000 of revenue that was included in deferred revenue as of December 31, 2020.

Revenue recorded over time for the years ended December 31, 2022 and 2021 was $970,000 and $1,809,000, respectively. Revenue recorded at a period in time for the years ended December 31, 2022 and 2021 was $4,506,000 and $5,930,000, respectively.

The Company disaggregates its revenue by geographic region. See Note 14 - Segment Reporting for more information.

Taxes Billed to Customers and Remitted to Taxing Authorities

We recognize taxes billed to customers in revenue and taxes remitted to taxing authorities in our cost of revenue.

Long-Lived Assets, Goodwill and Intangible Assets

Long-Lived Assets, Goodwill, and Intangible Assets

Property and Equipment

Property and equipment are accounted for in accordance with ASC Topic 360 “Property, Plant, and Equipment” (“ASC Topic 360”), stated at cost, and are depreciated using the straight-line method over the estimated economic lives of the assets, which range from three to ten years. Leasehold improvements are amortized over the shorter of either the asset’s useful life or the related lease term. Depreciation is computed on the straight-line method for financial reporting purposes. Property and equipment assets, net of accumulated depreciation, totaled $3,000 and $159,000 as of December 31, 2022 and 2021, respectively.

Intangible Assets

Intangible assets are accounted for in accordance with ASC Topic 350 “Intangibles - Goodwill and Other” (“ASC Topic 350”), and intangible assets with finite lives are amortized using the straight-line method over the estimated economic lives of the assets, which initially ranged from five to twelve years. Intangible assets, net of accumulated amortization totaled $604,000 and $7,562,000 as of December 31, 2022 and 2021, respectively.

Goodwill

Goodwill is accounted for in accordance with ASC Topic 350 and is not amortized. Goodwill is subject to periodic testing for impairment. As of December 31, 2021, goodwill of $7,367,000 was recorded on our Consolidated Balance Sheet in connection with the October 1, 2019 acquisition of Oblong Industries. As a result of the impairment charges discussed below, there was no goodwill recorded on our Consolidated Balance Sheet as of December 31, 2022.

Operating Lease Right-of-use-assets

Right-of-use Assets are accounted for in accordance with ASC Topic 842 “Leases” (“ASC Topic 842”), and are amortized using a straight-line method over the estimated life of the lease. Right-of-use assets, net totaled $142,000 and $659,000, as of December 31, 2022 and 2021, respectively.

The Company primarily leases facilities for office, warehouse, and data center space under non-cancellable operating leases for its U.S. locations, and accounts for these leases in accordance with ASC-842. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the expected lease term. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Since our lease arrangements do not provide an implicit rate, we use our estimated incremental borrowing rate for the expected remaining lease term at commencement date in determining the present value of future lease payments.

Impairment

The Company assesses the impairment of our long-lived assets subject to amortization when events and circumstances indicate that the carrying value of the assets might not be recoverable. The determination of related estimated useful lives and whether or not these assets are impaired involves significant judgments, related primarily to the future profitability and/or future value of the assets. Changes in the Company’s strategic plan and/or other-than-temporary changes in market conditions could significantly impact these judgments and could require adjustments to recorded asset balances. Long-lived assets are evaluated for impairment whenever an event or change in circumstances has occurred that could have a significant adverse effect on the fair value of long-lived assets.

During the year ended December 31, 2022, we considered the declines in revenue for the Collaboration Products reporting segment and the decline in the Company’s market capitalization to be triggering events for an impairment test of our long-lived and intangible for this reporting unit. Based on the corresponding recoverability tests of the asset group for this reporting unit, it was determined that the carrying value exceeded the gross cash flows of the asset group. The recoverability tests consisted of comparing the estimated undiscounted cash flows expected to be generated by those assets to the respective carrying amounts, and involves significant judgements and assumptions, related primarily to the future revenue and profitability of the assets.

For the year ended December 31, 2022, the Company recorded net impairment charges on property and equipment assets of $59,000. See Note 5 - Property and Equipment for further discussion. During the year ended December 31, 2021, the Company recorded impairment charges of $98,000 on property and equipment assets.

For the year ended December 31, 2022, the Company recorded impairment charges of $5,133,000 on purchased intangible assets. See Note 7 - Intangible Assets for further discussion. The Company recorded impairment Charges of $207,000 to purchased intangible assets for the year ended December 31, 2021.

We tested goodwill for impairment on an annual basis, on September 30th of each year, unless events occurred or circumstances changed indicating that the fair value of the goodwill may be below its carrying amount. During the year ended December 31, 2022, we considered the sustained decline in our stock price to be a triggering event for an interim goodwill impairment test, as of both March 31, 2022 and June 30, 2022. To determine the fair value of the reporting unit for the goodwill impairment test, we used a weighted average of the discounted cash flow method and market-based method.

During the year ended December 31, 2022, we recorded impairment charges of $7,367,000, related to the tests discussed above. See Note 6 - Goodwill for further discussion. No impairments were recorded for Goodwill during the year ended December 31, 2021.

Right-of-use assets are tested for impairment using guidance from ASC Topic 360. For the year ended December 31, 2022, the Company recorded aggregate impairment charges of $179,000 on two right-of-use assets. See Note 9 - Operating Lease Liabilities and Right-of-Use Assets for further discussion. There were no right-of-use asset impairments for the year ended December 31, 2021.

Operating Leases

Operating leases are accounted for in accordance with ASC Topic 842 “Leases” (“ASC Topic 842”), and the liabilities are amortized using a straight-line method over the estimated life of the lease. The remaining operating lease liability as of December 31, 2022 and 2021 was $236,000 and $728,000, respectively. See Note 9 - Operating Lease Liabilities and Right-of-Use Assets for further discussion.

Operating lease expense is recognized on a straight-line basis over the lease term. Variable lease payments are not included in the lease payments to measure the lease liability and are expensed as incurred. The Company’s leases have remaining terms of one to fourteen months and some of the leases include a Company option to extend the lease term for less than twelve months to five years, or more, which if reasonably certain to exercise, the Company includes in the determination of lease payments. The lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Leases with an initial term of 12 months or less, with the exception of leases for real property, are not recognized on the balance sheet and the expense for these short-term leases is recognized on a straight-line basis over the lease term. Common area maintenance fees (or CAMs) and other charges related to leases are expensed as incurred.

Concentration of Credit Risk

Concentration of Credit RiskFinancial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and trade accounts receivable. We place our cash needed for operations in commercial checking accounts, and the majority of our cash is held in a money market fund. Commercial bank balances may from time to time exceed federal insurance limits. Deposits are insured by the Federal Deposit Insurance Corporation (the “FDIC”) in an amount up to $250,000 for any depositor, any deposit in excess of this insured amount could be lost.

Income Taxes

We use the asset and liability method to determine our income tax expense or benefit. Deferred tax assets and liabilities are computed based on temporary differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates that are expected to be in effect when the differences are expected to be recovered or settled. Any resulting net deferred tax assets are evaluated for recoverability and, accordingly, a valuation allowance is provided when it is more likely than not that all or some portion of the deferred tax asset will not be realized.

Stock-based Compensation

Stock-based awards have been accounted for as required by ASC Topic 718 “Compensation – Stock Compensation” (“ASC Topic 718”). Under ASC Topic 718 stock-based awards are valued at fair value on the date of grant, and that fair value is recognized over the requisite service period. The Company accounts for forfeitures when they occur.

Research and Development

Research and Development Research and development expenses include internal and external costs related to developing new service offerings and features and enhancements to our existing product offerings.

Treasury Stock

Treasury StockPurchases and sales of treasury stock are accounted for using the cost method. Under this method, shares acquired are recorded at the acquisition price directly to the treasury stock account. Upon sale, the treasury stock account is reduced by the original acquisition price of the shares and any difference is recorded in additional paid in capital, on a first-in first-out basis. The Company does not recognize a gain or loss to income from the purchase and sale of treasury stock.

Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements

There are no new accounting pronouncements that are expected to have a significant impact on financial statements.

In June 2016 the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326),” which was subsequently amended in February 2020 by ASU 2020-02, “Financial Instruments - Credit Losses (Topic 326) and Leases (Topic 842).” The amendments introduce an impairment model that is based on expected credit losses, rather than incurred losses, to estimate credit losses on certain types of financial instruments (e.g., loans and held-to-maturity securities), including certain off-balance sheet financial instruments (e.g., loan commitments). The expected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments, over the contractual term. Financial instruments with similar risk characteristics may be grouped together when estimating expected credit losses. The update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted the new guidance, as of January 1, 2023, and it did not have a material impact on the Consolidated Financial Statements.