Identiv Inc

Previous wording

This Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations, and other parts of this Quarterly Report on Form 10-Q (“Quarterly Report”) contain forward-looking statements, within the meaning of the safe harbor provisions under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. Forward-looking statements reflect current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “will,” “believe,” “could,” “should,” “would,” “may,” “anticipate,” “intend,” “plan,” “estimate,” “expect,” “project” or the negative of these terms or other similar expressions. Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in Part II, Item 1A of this Report and in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023, as amended, under the heading “Risk Factors,” The following discussion should be read in conjunction with the audited consolidated financial statements and notes thereto included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2023, as amended. We assume no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Current wording

This Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations, and other parts of this Quarterly Report on Form 10-Q (“Quarterly Report”) contain forward-looking statements, within the meaning of the safe harbor provisions under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. Forward-looking statements reflect current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “will,” “believe,” “could,” “should,” “would,” “may,” “anticipate,” “intend,” “plan,” “estimate,” “expect,” “project” or the negative of these terms or other similar expressions. Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in Part II, Item 1A of this Quarterly Report and in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023, as amended, under the heading “Risk Factors,” The following discussion should be read in conjunction with the audited consolidated financial statements and notes thereto included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2023, as amended. We assume no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Previous wording

The IoT Business segment develops, manufactures, and supplies specialty IoT solutions tailored for the healthcare industry and other high-value end markets. Our specialty RFID IoT devices, including NFC, high frequency (HF), dual frequency (DF), ultra-high frequency (UHF) and Bluetooth Low Energy (BLE), are attached to or embedded into physical items, such as syringes, pill containers, wine bottles, and sports jerseys, providing those items with a unique digital identity. These devices enable unique and secure digital interaction with the physical world while simultaneously capturing relevant data which can then be analyzed and managed by the end customer. We sell our products across multiple industries, focusing on pharmaceutical and medical devices, consumer electronics, mobile devices, wine and spirits, luxury goods, libraries, and logistics.

Current wording

The IoT Business segment develops, manufactures, and supplies specialty IoT solutions tailored for the healthcare industry and other high-value end markets. Our specialty radio-frequency identification (RFID) IoT devices, including NFC, high frequency (HF), dual frequency (DF), ultra-high frequency (UHF) and Bluetooth Low Energy (BLE), are attached to or embedded into physical items, such as syringes, pill containers, wine bottles, and sports jerseys, providing those items with a unique digital identity. These devices enable unique and secure digital interaction with the physical world while simultaneously capturing relevant data which can then be analyzed and managed by the end customer. We sell our products across multiple industries, focusing on pharmaceutical and medical devices, consumer electronics, mobile devices, wine and spirits, luxury goods, libraries, and logistics.

Previous wording

On April 2, 2024, we entered into a Stock and Asset Purchase Agreement (the “Purchase Agreement”) with Hawk Acquisition, Inc., a Delaware corporation (“Buyer”) and a wholly-owned subsidiary of Vitaprotech SAS, a French société par actions simplifiée and provider of security solutions (“Vitaprotech”). Upon the terms and subject to the conditions set forth in the Purchase Agreement, at the closing of the transactions contemplated thereby, we will sell our physical security, access card, and identity reader operations and assets, including all outstanding shares of Identiv Private Limited, our wholly-owned subsidiary (the “Physical Security Business”), to Buyer in exchange for $145.0 million (the “Purchase Price”), subject to customary adjustments, including net working capital, as set forth in the Purchase Agreement, and the assumption by Buyer of certain liabilities related to the Physical Security Business (collectively, the “Asset Sale”).

Current wording

On September 6, 2024, the Company completed the sale of its physical security, access card, and identity reader operations and assets, including all outstanding shares of Identiv Private Limited, its wholly-owned subsidiary (the “Physical Security Business”) to Hawk Acquisition, Inc., a Delaware corporation (“Buyer”) and a wholly-owned subsidiary of Vitaprotech SAS, a French société par actions simplifiée and provider of security solutions, and Buyer assumed certain of the Company’s liabilities related to the Physical Security Business (collectively, the “Asset Sale”) pursuant to that certain Stock and Asset Purchase Agreement, dated as of April 2, 2024 (the “Purchase Agreement”), by and between the Company and Buyer. As consideration for the Asset Sale, the Company received approximately $144.3 million in cash, subject to further customary adjustments as set forth in the Purchase Agreement.

Previous wording

In addition, upon the closing of the Asset Sale, restricted stock units (“RSUs”) relating to unvested shares held by our employees who are employed by the Physical Security Business and remain employed by the Company through the closing of the Asset Sale and, effective immediately following the Asset Sale, become employees of Buyer (or an affiliate of Buyer) will become vested at Closing, while RSUs held by our remaining employees and non-employee directors will continue to vest according to their terms.

Current wording

In addition, at the closing of the Asset Sale, unvested restricted stock units (“RSUs”) held by employees who became employed by the Buyer (or an affiliate of Buyer) became fully vested, while RSUs held by our remaining employees and non-employee directors continue to vest according to their terms.

Previous wording

Following the completion of the Asset Sale, we will continue to be a public company operating under the name Identiv, Inc. and will continue to own the assets and liabilities of our business that are not sold to Buyer, which we refer to herein as the “IoT Business”. The discussion in this Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations, unless otherwise noted, relates solely to the Company’s continuing operations.

Current wording

Following the completion of the Asset Sale, we continue to be a public company operating under the name Identiv, Inc. and continue to own the assets and liabilities of our business that were not sold to Buyer, which we refer to herein as the “IoT Business”.

Previous wording

Our remaining business will be affected by the Asset Sale, assuming it closes. The pending Asset Sale includes assets and operations that have historically represented the majority of our revenues, representing approximately 63% of our 2023 revenue, as well as a substantial portion of our assets, representing approximately 43% of our assets as of December 31, 2023. The gross margin profile of the remaining business will be significantly lower than our historical total gross margins across a lower revenue base. As a result, we expect our net loss to increase substantially. From a liquidity and capital resources perspective, the Asset Sale is expected to result in approximately $145.0 million in proceeds to the Company; excluding transaction costs, taxes and other costs associated with the closing of the Asset Sale.

Current wording

Our business has and will continue to be affected by the Asset Sale. The Asset Sale included assets and operations that have historically represented the majority of our revenues, representing approximately 63% of our 2023 revenue, as well as a substantial portion of our assets, representing approximately 43% of our assets as of December 31, 2023. The gross margin profile of our continuing business has and will continue to be significantly lower than our historical total gross margins across a lower revenue base. As a result, our net loss has and we expect it will continue to increase substantially.

Previous wording

For additional information regarding the risks related to the pending Asset Sale, see “Risks Related to the Asset Sale” and “Risks Related to the Company’s IoT Business if the Asset Sale is Completed” under “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q.

Current wording

For additional information regarding the risks related to our continuing business, see “Risks Related to the Company’s IoT Business” under “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q.

Previous wording

Our results of operations for the three and six months ended June 30, 2024 and 2023 is as follows (in thousands, except percentages).

Current wording

Our results of operations for the three and nine months ended September 30, 2024 and 2023 is as follows (in thousands, except percentages).

Previous wording

Net revenue for the three and six months ended June 30, 2024 was $6.7 million and $13.4 million, respectively, decreases of 41% and 34% compared with $11.5 million and $20.4 million, respectively, for the comparable periods of 2023.

Current wording

Net revenue for the three and nine months ended September 30, 2024 was $6.5 million and $19.9 million, respectively, decreases of 44% and 38% compared with $11.7 million and $32.1 million, respectively, for the comparable periods of 2023.

Previous wording

Net revenue in the Americas for the three and six months ended June 30, 2024 was $3.4 million and $6.3 million, respectively, decreases of 57% and 56% compared to $7.9 million and $14.3 million, respectively, for the comparable periods of 2023. These decreases were primarily due to substantially lower unit sales of RFID transponder products to one of our customers undergoing a technology transition to their next-generation (Gen 3) chip. We do not expect shipments to this customer for at least a few quarters while they work on producing their Gen 3 chip.

Current wording

Net revenue in the Americas for the three and nine months ended September 30, 2024 was $2.8 million and $9.1 million, respectively, decreases of 34% and 51% compared to $4.2 million and $18.5 million, respectively, for the comparable periods of 2023. These decreases were primarily due to substantially lower unit sales of RFID transponder products to one of our customers undergoing a technology transition to their next-generation (Gen 3) chip. We do not expect shipments to this customer for at least a few quarters while they work on producing their Gen 3 chip.

Previous wording

Net revenue in Europe, the Middle East, and the Asia-Pacific for the three months ended June 30, 2024 was $3.4 million, a decrease of 5% compared with the comparable period of 2023. The decrease was primarily due to lower sales of RFID transponder products in the Asia-Pacific, partially offset by higher sales RFID transponder products in Europe and the Middle East. Net revenue in Europe, the Middle East, and the Asia-Pacific for the six months ended June 30, 2024 was $7.1 million, an increase of 17% compared with the comparable period of 2023. The increase was primarily due to higher sales of RFID transponder products in Europe and the Middle East, partially offset by lower sales RFID transponder products in the Asia-Pacific.

Current wording

Net revenue in Europe, the Middle East, and the Asia-Pacific for the three and nine months ended September 30, 2024 was $3.8 million and $10.8 million, decreases of 50% and 20%, respectively, compared with the comparable period of 2023. The decreases were primarily due to lower sales of RFID transponder products in both Europe and the Middle East and the Asia-Pacific.

Previous wording

Gross profit for the three months ended June 30, 2024 was $0.6 million compared with $1.6 million in the comparable period of 2023. Gross profit for six months ended June 30, 2024 was $1.1 million compared with $2.9 million in the comparable period of 2023. Gross profit represents net revenue less direct cost of product sales, manufacturing overhead, other costs directly related to preparing the product for sale including freight, scrap, and inventory adjustments, where applicable.

Current wording

Gross profit for the three months ended September 30, 2024 was $0.2 million compared with $1.3 million in the comparable period of 2023. Gross profit for nine months ended September 30, 2024 was $1.3 million compared with $4.2 million in the comparable period of 2023. Gross profit represents net revenue less direct cost of product sales, manufacturing overhead, other costs directly related to preparing the product for sale including freight, scrap, and inventory adjustments, where applicable.

Previous wording

Gross profit margins for the three and six months ended June 30, 2024 decreased to 9% and 8% from 14% in the comparable periods of 2023. The decrease in gross profit margins was primarily attributable to substantially lower unit sales to one of our customers, as discussed above, resulting in underutilization of our manufacturing production facilities in Singapore and Thailand.

Current wording

Gross profit margins for the three and nine months ended September 30, 2024 decreased to 4% and 7% from 11% and 13% in the comparable periods of 2023. The decrease in gross profit margins was primarily attributable to substantially lower unit sales to one of our customers, as discussed above, resulting in underutilization of our manufacturing production facilities in Singapore and Thailand.

Previous wording

Information about our operating expenses for the three and six months ended June 30, 2024 and 2023 is set forth below (dollars in thousands).

Current wording

Information about our operating expenses for the three and nine months ended September 30, 2024 and 2023 is set forth below (dollars in thousands).

Previous wording

Research and development expenses for the three and six months ended June 30, 2024 decreased compared to the comparable prior year period primarily due to costs incurred in the second quarter of 2023 associated with the setup of our Thailand facility in 2023, as well as lower headcount and related payroll costs year over year.

Current wording

Research and development expenses for the three months ended September 30, 2024 increased compared to the comparable prior year period primarily due to higher external contractor costs as well as higher travel related costs. For the nine months ended September 30, 2024, the decrease in research and development expenses were attributable to lower headcount and payroll related costs.

Previous wording

Selling and marketing expenses for the three months ended June 30, 2024 increased compared to the three months ended June 30, 2023 primarily due to higher stock-based compensation expense period over period. Selling and marketing expenses for the six months ended June 30, 2024 decreased compared to the six months ended June 30, 2023 primarily due to lower third-party contractor costs as well as lower trade show-related costs in 2024 compared to 2023.

Current wording

Selling and marketing expenses for the three months ended September 30, 2024 increased compared to the comparable period in the prior year primarily due to higher advertising and trade show-related costs. For the nine months ended September 30, 2024, the increase period over period was associated with higher trade show-related costs, offset by lower third-party contractor costs.

Previous wording

General and administrative expenses for the three and six months ended June 30, 2024 increased compared to the prior year period primarily due to higher headcount and related payroll costs, higher stock-based compensation expense, higher outside contractors costs, and legal fees, as well as professional services fees of $1.6 million and $2.6 million, respectively, associated with strategic review-related activities incurred in 2024.

Current wording

General and administrative expenses for the three and nine months ended September 30, 2024 increased compared to the prior year periods primarily due to higher headcount and related payroll costs, higher stock-based compensation expense, higher outside contractors costs, and legal fees, as well as professional services fees of $3.6 million and $6.1 million, respectively, associated with strategic review-related activities incurred in 2024.

Previous wording

Restructuring expenses for the three and six months ended June 30, 2023 consisted of severance related costs.

Current wording

Restructuring expenses for the nine months ended September 30, 2023 consisted of severance related costs.

Previous wording

Information about our non-operating income (expense) for the three and six months ended June 30, 2024 and 2023 is set forth below (dollars in thousands).

Current wording

Information about our non-operating income (expense) for the three and nine months ended September 30, 2024 and 2023 is set forth below (dollars in thousands).

Previous wording

Interest expense, net consists of interest on financial liabilities and amortization of debt issuance costs. The increase in interest expense for the three and six months ended June 30, 2024 compared to the comparable period of 2023 was attributable to higher borrowings under our revolving loan facility with our lender in 2024 compared with 2023.

Current wording

Interest income (expense), net consists interest income generated on our cash equivalents offset by interest costs on our financial liabilities and amortization of debt issuance costs. The increase in interest income (expense), net for the three and nine months ended September 30, 2024 compared to the comparable period of 2023 was primarily attributable to interest earned on our money market accounts and treasury bills.

Previous wording

We recorded an income tax benefit and provision during the three and six months ended June 30, 2024, respectively. The effective tax rates for the three and six months ended June 30, 2024 and 2023 differ from the federal statutory rate of 21% primarily due to a change in valuation allowance, and the provision or benefit in certain foreign jurisdictions, which are subject to higher tax rates.

Current wording

We recorded an income tax provision during the three and nine months ended September 30, 2024, respectively, associated with taxable income from one of our foreign subsidiaries. The effective tax rates for the three and nine months ended September 30, 2024 and 2023 differ from the federal statutory rate of 21% primarily due to a change in valuation allowance, and the provision or benefit in certain foreign jurisdictions, which are subject to higher tax rates.

Previous wording

Income from Discontinued Operations, net of tax

Current wording

Income (Loss) from Discontinued Operations, net of tax

Previous wording

Income from discontinued operations consists of the results of operations, net of tax of our Physical Security Business which we disclosed as assets-held-for sale and discontinued operations in accordance with ASC 205.

Current wording

Income from discontinued operations consists of the results of operations, net of tax of our Physical Security Business which we disclosed as discontinued operations. The gain on sale of the Physical Security Business is subject to adjustment as we complete our tax analysis on the ability to utilize net operating loss and credit carryforwards to reduce the amount of income tax provision. Any adjustment to the income tax provision recorded in connection with the Sale of the Physical Security Business will be completed by December 31, 2024.

Previous wording

As of June 30, 2024, our working capital, defined as current assets less current liabilities, was $41.2 million, a decrease of $7.6 million compared to $48.7 million as of December 31, 2023. As of June 30, 2024, our cash and cash equivalents balance was $18.4 million.

Current wording

As of September 30, 2024, our working capital, defined as current assets less current liabilities, was $147.0 million, an increase of $98.3 million compared to $48.7 million as of December 31, 2023. As of September 30, 2024, our cash and cash equivalents balance was $145.4 million.

Previous wording

On February 8, 2017, we entered into a Loan and Security Agreement (as amended or amended and restated from time to time, the “Loan Agreement”) with East West Bank (“EWB”). Following subsequent amendments, on April 14, 2022, we amended and restated the Loan Agreement by replacing the $20.0 million revolving loan facility subject to a borrowing base with a non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023. In addition, the interest rate was lowered from prime to prime minus 0.25%, and certain financial covenants were amended. On February 8, 2023, we entered into an amendment (the "Fourth Amendment") to the Loan Agreement. The Fourth Amendment amends the Loan Agreement to, among other things, extend the maturity date to February 8, 2025 and amend certain financial covenants. We were not in compliance with a financial covenant under our Loan Agreement as of June 30, 2024, which non-compliance was waived by EWB on August 5, 2024.

Current wording

On February 8, 2017, we entered into a Loan and Security Agreement (as amended or amended and restated from time to time, the “Loan Agreement”) with East West Bank (“EWB”). Following subsequent amendments, on April 14, 2022, we amended and restated the Loan Agreement by replacing the $20.0 million revolving loan facility subject to a borrowing base with a non-formula revolving loan facility with no borrowing base requirement and a maturity date of February 8, 2023. In addition, the interest rate was lowered from prime to prime minus 0.25%, and certain financial covenants were amended. On February 8, 2023, we entered into an amendment (the "Fourth Amendment") to the Loan Agreement. The Fourth Amendment amends the Loan Agreement to, among other things, extend the maturity date to February 8, 2025 and amend certain financial covenants. As of September 30, 2024, there were no amounts outstanding under the Loan Agreement.

Previous wording

As our previously unremitted earnings have been subjected to U.S. federal income tax, we expect any repatriation of these earnings to the U.S. would not incur significant additional taxes related to such amounts. However, our estimates are provisional and subject to further analysis. Generally, most of our foreign subsidiaries have accumulated deficits and cash and cash equivalents that are held outside the United States are typically not cash generated from earnings that would be subject to tax upon repatriation if transferred to the United States. We have access to the cash held outside the United States to fund domestic operations and obligations without any material income tax consequences. As of June 30, 2024, the amount of cash included at such subsidiaries was $6.9 million. We have not, nor do we anticipate the need to, repatriate funds to the United States to satisfy domestic liquidity needs arising in the ordinary course of business, including liquidity needs associated with our domestic debt service requirements.

Current wording

As our previously unremitted earnings have been subjected to U.S. federal income tax, we expect any repatriation of these earnings to the U.S. would not incur significant additional taxes related to such amounts. However, our estimates are provisional and subject to further analysis. Generally, most of our foreign subsidiaries have accumulated deficits and cash and cash equivalents that are held outside the United States are typically not cash generated from earnings that would be subject to tax upon repatriation if transferred to the United States. We have access to the cash held outside the United States to fund domestic operations and obligations without any material income tax consequences. As of September 30, 2024, the amount of cash included at such subsidiaries was $3.3 million. We have not, nor do we anticipate the need to, repatriate funds to the United States to satisfy domestic liquidity needs arising in the ordinary course of business, including liquidity needs associated with our domestic debt service requirements.

Previous wording

We have historically incurred operating losses and negative cash flows from operating activities, and we expect to continue to incur losses in the future. As of June 30, 2024, we had an accumulated deficit of $425.6 million. During the six months ended June 30, 2024, we had a net loss of $10.8 million which included strategic review-related costs of $2.6 million. We will continue to incur strategic review-related costs through the closing of the Asset Sale.

Current wording

We have historically incurred operating losses and negative cash flows from operating activities, and we expect to continue to incur losses in the future. As of September 30, 2024, we had an accumulated deficit of $339.7 million. During the nine months ended September 30, 2024, we had a loss from continuing operations of $21.6 million which included strategic review-related costs of $6.1 million.

Previous wording

We believe our existing cash and cash equivalents, together with cash generated from operations and available credit under our Loan Agreement will be sufficient to satisfy our working capital needs to fund operations for the next 12 months. We may also use cash to acquire or invest in complementary businesses, technologies, services or products that would change our cash requirements. We may also choose to finance our business through public or private equity offerings, debt financings or other arrangements. However, there can be no assurance that additional capital will be available to us or that such capital will be available to us on acceptable terms. If we raise funds by issuing equity securities, dilution to stockholders could result. Debt or any equity securities issued also may provide for rights, preferences or privileges senior to those of holders of our common stock. The terms of debt securities issued or loans could impose significant restrictions on our operations. The incurrence of additional indebtedness or the issuance of certain debt or equity securities could result in increased fixed payment obligations and could also result in restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, limitations on our ability to acquire or license intellectual property rights and other operating restrictions that could adversely affect our ability to conduct our business. Our

Current wording

We believe our existing cash and cash equivalents, together with cash generated from operations and available credit under our Loan Agreement will be sufficient to satisfy our working capital needs to fund operations for the next 12 months. We may also use cash to acquire or invest in complementary businesses, technologies, services or products that would change our cash requirements. We may also choose to finance our business through public or private equity offerings, debt financings or other arrangements. However, there can be no assurance that additional capital will be available to us or that such capital will be available to us on acceptable terms. If we raise funds by issuing equity securities, dilution to stockholders could result. Debt or any equity securities issued also may provide for rights, preferences or privileges senior to those of holders of our common stock. The terms of debt securities issued or loans could impose significant restrictions on our operations. The incurrence of additional indebtedness or the issuance of certain debt or equity securities could result in increased fixed payment obligations and could also result in restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, limitations on our ability to acquire or license intellectual property rights and other operating restrictions that could adversely affect our ability to conduct our business. Our Loan Agreement imposes restrictions on our operations, increases our fixed payment obligations and has restrictive covenants. In addition, the issuance of additional equity securities by us, or the possibility of such issuance, may cause the market price of our common stock to decline. If we are not able to secure additional funding when needed, we may have to curtail or reduce the scope of our business or forgo potential business opportunities.

Previous wording

The following summarizes our cash flows for the six months ended June 30, 2024 and 2023 (in thousands):

Current wording

The following summarizes our cash flows for the nine months ended September 30, 2024 and 2023 (in thousands):

Previous wording

Cash used in operating activities for the six months ended June 30, 2024 of $2.3 million, was primarily due to net loss of $10.8 million, offset by an increase in cash from net changes in operating assets and liabilities of $4.4 million and adjustments for certain non-cash items of $4.1 million, consisting primarily of depreciation, amortization and stock-based compensation.

Current wording

Cash used in operating activities for the nine months ended September 30, 2024 of $9.5 million, was primarily due to adjustments to net income for certain non-cash items of $89.3 million, consisting primarily of the gain on sale of our Physical Security Business of $99.5 million, as well as depreciation, amortization and stock-based compensation, offset by net income of $75.2 million and an increase in cash from net changes in operating assets and liabilities of $4.6 million.

Previous wording

Cash used in operating activities for the six months ended June 30, 2023 of $3.3 million, was primarily due to net loss of $3.9 million, a decrease in cash from net changes in operating assets and liabilities of $2.7 million, which included $2.2 million in strategic inventory purchases, partially offset by adjustments for certain non-cash items of $3.3 million, consisting primarily of depreciation, amortization and stock-based compensation.

Current wording

Cash used in operating activities for the nine months ended September 30, 2023 of $3.6 million, was primarily due to net loss of $3.9 million, a decrease in cash from net changes in operating assets and liabilities of $4.6 million, partially offset by adjustments for certain non-cash items of $4.9 million, consisting primarily of depreciation, amortization and stock-based compensation.

Previous wording

Cash used in investing activities for the six months ended June 30, 2024 and 2023 was $0.4 million and $2.4 million, respectively, which related primarily to capital investment expenditures in our manufacturing facility in Thailand.

Current wording

Cash used in investing activities for the nine months ended September 30, 2023 was $3.0 million related primarily to capital expenditures for our manufacturing facility in Thailand.

Previous wording

Cash used in financing activities during the six months ended June 30, 2024 was $2.7 million, which consisted of net repayments of $2.1 million under our revolving loan facility with our lender, and net share settlements of RSUs of $0.5 million.

Current wording

Cash used in financing activities during the nine months ended September 30, 2024 was $11.7 million, which consisted of net repayments of $10.1 million under our revolving loan facility with our lender, and net share settlements of RSUs of $1.6 million.

Previous wording

Cash provided by financing activities during the six months ended June 30, 2023 was $10.6 million, which consisted of net borrowings of $9.9 million under our revolving loan facility with our lender, proceeds received from the exercise of warrants by 21 April Fund, LP and 21 April Fund, Ltd. of approximately $1.0 million, partially offset by net share settlements of RSUs of $0.3 million.

Current wording

Cash provided by financing activities during the nine months ended September 30, 2023 was $10.5 million, which consisted of net borrowings of $9.9 million under our revolving loan facility with our lender, proceeds received from the exercise of warrants by 21 April Fund, LP and 21 April Fund, Ltd. of approximately $1.0 million, partially offset by net share settlements of RSUs of $0.4 million.