AEye, Inc.

AEYE,** INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share data or otherwise stated)

AEye, Inc. and its wholly owned subsidiaries (the “Company” or “AEye”) is a provider of high-performance, active lidar systems for vehicle autonomy, advanced driver-assistance systems ("ADAS"), and robotic vision applications. AEye’s Intelligent Sensing Platform includes a solid-state software definable active lidar sensor, an adaptive sensing SmartScan architecture to scan dynamic scenes/targets, and sophisticated signal processing capability that provides precise measurements and imaging for various safety-critical applications. The Intelligent Sensing Platform captures more information with less data, facilitating faster, more accurate, and more reliable perception of the environment.

AEye, formerly known as CF Finance Acquisition Corp. III, (“CF III”), was originally incorporated in Delaware on* March 15, 2016under the name CF SPAC Re Inc. On February 17, 2021,AEye Technologies, Inc., then known as AEye, Inc., entered into an Agreement and Plan of Merger with CF III. Based on CF III’s business activities, it was a “shell company” as defined under the Securities Exchange Act of1934,* as amended. On* August 16, 2021,*the business combination contemplated by the Agreement and Plan of Merger was closed and CF III changed its name to AEye, Inc.

The Company’s common stock and public warrants are listed on the Nasdaq Stock Market LLC (“Nasdaq”) under the symbols “LIDR” and “LIDRW”, respectively. Unless otherwise specified, “we,” “us,” “our,” “AEye,” and the “Company” refers to AEye, Inc. and its wholly owned subsidiaries.

Unaudited Condensed Consolidated Financial Statements

The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they donot include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for fair presentation have been included. The accompanying interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company's Annual Report on Form10-K for the year ended* December 31, 2024*.

Reclassification of Prior Period Presentation

Certain prior year amounts have been reclassified for consistency with the current year presentation.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with 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 condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include lease termination liability, write-downs of inventory to the lower of cost or net realizable value, investments, embedded derivative and warrant liabilities, stock-based compensation, and convertible notes.

Principle of Consolidation and Liquidity

The accompanying condensed consolidated financial statements include the accounts of AEye, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

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The Company has funded its operations primarily through the issuances of common stock. Since its inception, the Company has incurred net losses and negative cash flows from operations and expects to incur additional operating losses and negative operating cash flows as management continues to focus on achieving commercialization of its lidar solutions and execute on its strategic initiatives. As of* September 30, 2025*, the Company’s existing sources of liquidity included cash, cash equivalents, and marketable securities of $84,333. Management believes that the Company has sufficient financial resources to fund operations and meet its capital requirements and anticipated obligations as they come due in the nexttwelve months from the date of issuance of these condensed consolidated financial statements.

Emerging Growth Company

The Company is an “emerging growth company,” as defined in Section2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of2012 (the “JOBS Act”), and it* maytake advantage of certain exemptions from various reporting requirements that are applicable to other public companies that arenot* emerging growth companies including, butnot limited to,not being required to comply with the independent registered public accounting firm attestation requirements of Section404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute paymentsnot previously approved.

Further, Section102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that havenot had a Securities Act registration statement declared effective or donot have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected to take advantage of the benefits of the extended transition period for new or revised financial accounting standards. This* maymake it difficult or impossible to compare the Company’s financial results with the financial results of another public company that is eithernot* an emerging growth company or is an emerging growth company that has chosennot to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.

Concentration of Credit Risk

Financial instruments which potentially subject the Company to concentration of credit risk consist primarily of cash, cash equivalents, and marketable securities, and accounts receivable. The Company places its cash and cash equivalents with major financial institutions, which management assesses to be of high credit quality, to limit the exposure of each investment. The Company’s marketable securities have investment grade ratings when purchased which mitigates risk.

The Company’s accounts receivable are derived from customers located in the U.S., Europe, and Asia-Pacific. The Company mitigates its credit risks by performing ongoing credit evaluations of its customers’ financial conditions. The Company generally doesnot require collateral.

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Recent Accounting Pronouncements

In* December2023,* the Financial Accounting Standards Board (“FASB”), issued Accounting Standards Update (“ASU”)2023-09, Income Taxes (Topic740*) - Improvements to Income Tax Disclosures*, to increase the transparency and usefulness of income tax information through improvements to the income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The guidance is effective for fiscal years beginning after* December15,* 2024. The Company is currently assessing the effect that the updated standard will have on its financial statement disclosures.

In* November 2024,FASB issued ASU2024*-03, Disaggregation of Income Statement Expenses, which requires annual and interim disclosure of disaggregated disclosures of certain costs and expenses on the income statement. The standard is effective for fiscal years beginning after* December 15, 2026,and interim periods within fiscal years beginning after December 15, 2027,*with early adoption permitted. Amendments are applied on a prospective basis with retrospective application permitted. The Company is currently evaluating the impact of this guidance.

The fair value of the Company’s financial assets and liabilities is determined in accordance with the fair value hierarchy established in FASB ASC Topic820, Fair Value Measurements and Disclosures (“ASC820”). ASC820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy of ASC820 requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs intothree levels:

Level 1—Observable inputs, such as quoted prices in active markets for identical assets or liabilities.

Level 2—Observable inputs, other than Level1 inputs, which are observable either directly or indirectly or can be corroborated by observable market data using quoted prices for similar assets or liabilities.

Level 3—Unobservable inputs in which there is little orno market data, which require the reporting entity to develop its own assumptions.

The Company's financial instruments that arenot remeasured at fair value include accounts receivable, prepaid and other current assets, accounts payable, accrued expenses, other current and noncurrent liabilities, and the noncurrent convertible note. The carrying values of these financial instruments approximate their fair values.

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The Company’s financial assets and liabilities measured at fair value on a recurring basis and the level of inputs used for such measurements were as follows (in thousands):

The Company’s financial assets and liabilities subject to fair value procedures were comprised of the following:

*Money Market Funds:*The Company holds financial assets consisting of money market funds. These securities are valued using observable inputs, such as quoted prices in active markets for identical assets or liabilities.

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Marketable Securities: The Company holds financial assets consisting of fixed-income U.S. government agency securities, corporate bonds, commercial paper, and asset-backed securities. The securities are valued using prices from independent pricing services based on quoted prices of identical instruments in less active or inactive markets. Additionally, quoted prices of similar instruments in active market or industry models using data inputs such as interest rates and prices that can be directly observed or corroborated in active markets are used to value marketable securities.

2025 Convertible Note: In* January**2025,* the Company entered into a convertible note agreement with a face value of $3,240 (the*"2025* Note"). The Company elected the fair value option to account for the2025 Note. The fair value estimate of the2025 Note is based on a binomial-lattice model, which represents Level3 measurements. Significant assumptions include the discount rate used in the model, remaining term, stock price, and volatility. The changes in fair value are recognized in other income (expense), net for each reporting period. See Note7 for details of the terms and conditions of the2025 Note.

Derivative Warrant Liabilities: On* September 15, 2022*, the Company entered into a convertible note agreement with a face value of $10,500 (the*"2022* Note"). The Company issued warrants as part of the2022 Note. The warrants are recorded on the condensed consolidated balance sheets at fair value. The fair value is based on unobservable inputs, which represent Level3 measurements within the fair value hierarchy. The fair value estimate of the warrants was based on a Monte-Carlo simulation model. Inherent in a Monte-Carlo simulation model are assumptions related to price, volatility, risk-free interest rate, term to expiration, and dividend yield. Changes in fair value are recognized in other income (expense) for each reporting period. Derivative Warrant Liability is included within other noncurrent liabilities on the condensed consolidated balance sheets. These warrants were cancelled on* July 28, 2025.*

In* January**2025,* in connection with the2025 Note, the Company issued warrants, which are recorded on the accompanying condensed consolidated balance sheets at fair value. The fair value is based on unobservable inputs, which represent Level3 measurements within the fair value hierarchy. The fair value estimate of the warrants was based on a Black-Scholes model. Inherent in a Black-Scholes model are assumptions related to price, volatility, risk-free interest rate, term to expiration, and dividend yield. Changes in fair value are recognized in other income (expense) for each reporting period. Derivative Warrant Liability is included within other noncurrent liabilities on the condensed consolidated balance sheets. These warrants were exercised in full on* July 28, 2025.*

In* August**2025,* in connection with the lease settlement (see Note5 for details of the settlement), the Company issued warrants, which are recorded on the accompanying condensed consolidated balance sheets at fair value. The fair value is based on unobservable inputs, which represent Level3 measurements within the fair value hierarchy. The fair value estimate of the warrants was based on a Black-Scholes model. Inherent in a Black-Scholes model are assumptions related to price, volatility, risk-free interest rate, term to expiration, and dividend yield. Changes in fair value are recognized in other income (expense) for each reporting period. Derivative Warrant Liability is included within other noncurrent liabilities on the condensed consolidated balance sheets.

Private Placement Warrant Liability: The Private Placement Warrants are recorded on the condensed consolidated balance sheets at fair value. The fair value is based on observable Level2 inputs, specifically, the observable input of the Company's public warrants, as terms of both warrants are substantially similar. Any changes in the fair value of the liability are reflected in other income (expense), net, on the condensed consolidated statements of operations and comprehensive loss. Private Placement Warrant liability is included within other noncurrent liabilities on the condensed consolidated balance sheets.

For thenine months ended* September 30, 2025*, there wereno net transfers between Level1 and Level2 inputs.

The following table presents a summary of the changes in fair value of the Company’s Level3 financial instruments for thenine months ended* September 30, 2025* (in thousands):

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The key inputs into the Black-Scholes model for the derivative warrant liability from the2025 Note as of the exercise date of* July 28, 2025*are as follows:

The key inputs into the Black-Scholes model for the derivative warrant issued as a result of the lease settlement valued at* September 30, 2025* are as follows:

If factors or assumptions change, the estimated fair values could be materially different. The value of the Company’s convertible note and derivative warrant liabilities would increase if a higher risk-free interest rate was used and would decrease if a lower risk-free interest rate was used. Similarly, a higher volatility assumption would increase the value of the liabilities, and a lower volatility assumption would decrease the value of the liabilities.

Inventory, net of write-downs, as of* September 30, 2025* and* December 31, 2024* were as follows (in thousands):

The Company also had $0 and $209 of noncurrent inventory (raw materials), net of write-downs, classified within other noncurrent assets on the condensed consolidated balance sheet as of* September 30, 2025* and* December 31, 2024*, respectively.

The Company’s current and noncurrent inventory as of* September 30, 2025* and* December 31, 2024* was written down by $4,607 and $4,659, respectively, in order to reduce inventory to the lower of cost or net realizable value.

Prepaid and other current assets as of* September 30, 2025* and* December 31, 2024* were as follows (in thousands):

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The Company’s advances to suppliers as of* September 30, 2025* and* December 31, 2024* had been previously written down by $1,041, respectively, associated with the winding down of its legacy Non-Automotive product as part of its revised strategic plan. See Note15, Restructuring, for further details.

The Company leases office facilities in Northern California under non-cancelable operating leases. In* July 2024,*the Company entered intotwo new long-term leases, one of which the Company uses as its headquarters.

In* August 2024*, one of the Company's existing leases, originally set to expire on* November 30, 2026*, was terminated early. In conjunction with the early termination, the Company recorded a net gain of $491 on termination of the operating lease during the year ended* December 31, 2024*. The net gain included a gain of $5,954, comprised of a $16,325 net liability reduction, partially offset by a $10,371 decrease in its remaining right of use asset. Additionally, in accordance with terms in the lease agreement and based on certain assumptions, the Company recorded a lease termination loss of $5,463, representing estimated unpaid rent for the remaining term. The net gain was recorded in general and administrative expenses in the condensed consolidated statement of operations and comprehensive loss. The lease termination liability was reduced by the draw-down of the $2,150 letter of credit by the landlord in* August 2024*; the remaining liability of $3,313 as of* December 31, 2024*was recorded in accrued expenses and other current liabilities in the condensed consolidated balance sheet.

On* April 28, 2025,the Company and the former landlord entered into a settlement agreement to resolve all outstanding disputes related to the early termination of the lease. Under the terms of the agreement, the Company paid $1,400 in cash and has issued a warrant to purchase up to 350,000 shares of the Company's common stock at an exercise price of $2.22 per share with an estimated fair value of $899 on the date of issuance. The Company recorded a net gain on termination of operating lease of $1,014 during thenine* months ended* September 30, 2025.See Note17,* Commitments and Contingencies, for further discussion.

The components of operating lease expenses, excluding the loss (gain) on early termination of operating lease, for thenine months ended* September 30, 2025and2024*, are as follows (in thousands):

Maturities of lease liabilities are as follows (in thousands):

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Accrued expenses and other current liabilities as of* September 30, 2025* and* December 31, 2024* are as follows (in thousands):

2024 Promissory Note

On* May 10, 2024*, the Company entered into a Securities Purchase Agreement with an investor for the sale and issuance of 330,823 shares of common stock and a 5-year promissory note with a principal balance of $146 (* “May 2024Note”) for total gross cash proceeds of $1,000. The May 2024Note bears interest at an annual rate equal to the Secured Overnight Financing Rate plus 1.0%, which is compounded quarterly in arrears, and has a maturity date of June 4, 2029*. At maturity, the principal balance and accrued, unpaid and uncapitalized interest can be settled in cash, shares of common stock based on the closing price of the common stock as of the immediately preceding trading day, or any combination of the foregoing at the option of the investor. 

2025 Convertible Note

In* January**2025,* the Company entered into a Securities Purchase Agreement with a certain institutional investor and issued (i) a senior unsecured convertible promissory note (the*"2025* Note") for an aggregate principal amount of $3,240 for an aggregate purchase price of $3,000 and (ii) a warrant to purchase up to 805,263 shares of the Company’s common stock. The2025 Note, subject to an original issue discount of 7.4%, has a term ofeighteen months and accrues interest at the rate of 7% per annum. The interest* maybe settled in cash or shares at the option of the Company and is payable together with monthly redemptions of the outstanding principal amount of the2025* Note. The2025 Note is convertible into Common Stock, at a per share conversion price equal to $2.22, subject to adjustments noted in the2025 Note.

Monthly redemptions began in* April 2025and were due on thefirst* of each subsequent month (each a "Monthly Redemption Date" or an "Installment Date"). The Company was required to redeem the Monthly Redemption Amount until the2025 Note was fully redeemed, paid in cash or, so long as certain equity conditions are met, shares of our Common Stock. The equity conditions that must be met in order for the Company to settle the Monthly Redemption Amount in Common Stock include requirements for the daily volume weighted average price of the Company's Common Stock to exceed $0.50 and the average daily trading volume of the Company's Common Stock to exceed $100 for thetwenty (20) trading days prior to the applicable Installment Notice Date (which is thesixth (6th) trading day prior to each Installment Date). The Monthly Redemption Amount, in most instances, will be 1/15th of the original principal amount, plus any amount accelerated pursuant to the2025 Note, accrued but unpaid interest, and late fees, if any. If the Company elects to settle such redemptions in shares of Common Stock, the number of shares to be settled shall be based on an Installment Conversion Price equal to the lower of (i) $2.22 or (ii) the greater of $0.30 and 90% of average volume weighted average price of the Common Stock during thefive (5) trading days immediately preceding the applicable Monthly Redemption Date. The investor is permitted,not exceedingfive times, to accelerate up toone Monthly Installment Amount, between Installments, (each, an "Acceleration," and each such amount, an "Acceleration Amount", and the Conversion Date of any such Acceleration, each an "Acceleration Date") at the Acceleration Conversion Price. The Acceleration Conversion Price shall be the lower of (i) $2.22 or (ii) the greater of $0.30 and 90% of average volume weighted average price of the Common Stock during thefive (5) trading days immediately preceding the applicable Acceleration Date.

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The2025 Note* may**not* be converted into Common Stock to the extent such conversion would result in the investor and its affiliates having beneficial ownership of more than 19.99% of our then outstanding shares of Common Stock. This limitation is waived if the Company either obtains stockholder approval as required by the applicable exchange rules or secures a satisfactory written opinion from its counsel stating that such approval is unnecessary.

The Company and investor entered into a registration rights agreement (the “Registration Rights Agreement”) to which the Company is required to file a registration statement registering the resale by the investor of any shares of the Company’s common stock issuable upon conversion, including the resale of shares issuable upon exercise of the associated warrants. The Company is required to meet certain obligations with respect to the timeliness of the filing and effectiveness of the registration statement. The Company filed such registration statement on* January 16, 2025,and an amendment thereto on February 25, 2025,which was declared effective by the U.S. Securities and Exchange Commission on March 4, 2025.*

The Company elected to apply the fair value option to the measurement of the2025 Note. As a result of adopting the fair value option,no embedded derivatives are bifurcated from the2025 Note. The Company classifies the2025 Note as a liability at fair value and will remeasure the2025 Note to fair value at each reporting period. The total proceeds received from the investor of $3,000 is allocated between the2025 Note and the related warrants issued using the relative fair value method at issuance date. This resulted in an initial fair value of $3,266 being allocated to the2025 Note, and $1,046 allocated to the associated warrants (see Note2 for further details). The Company recorded a non-cash issuance cost of $1,312, representing the difference between the fair value and proceeds received, within Interest expense and other on the condensed consolidated statement of operations. The fair value measurement includes the assumption of accrued interest and expense and thus a separate amount isnot reflected on the condensed consolidated statement of operations.

During thenine months ended* September 30, 2025*, the Company made cash payments of $989. Additionally, $2,485 in aggregate principal and interest were converted into 2,356,500 shares of common stock. As of* September 30, 2025*, the2025 Note has an outstanding principal balance and accrued interest of $106 and is recorded as a current liability at fair value of $106.

Interest expense and other for thenine months ended* September 30, 2025and2024* consisted of the following (in thousands):

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New Circle Principal Investments LLC (“New Circle”) Common Stock Purchase Agreement (the“CSPA”)

On* July 25, 2024*, the Company entered into a CSPA and a Registration Rights Agreement with New Circle. Under the terms and subject to the conditions of the CSPA, the Company has the right, butnot the obligation, to sell to New Circle, and New Circle is obligated to purchase up to the lesser of (i) $50,000 of the Company’s common stock, or (ii) the Exchange Cap equal to 1,721,755 shares of the Company's common stock, unless the Company’s stockholders approve the issuance of shares in excess of the Exchange Cap, or the average price of all applicable sales of common stock to New Circle equals or exceeds$1.41 per share. The Company has sole discretion to initiate such sales of common stock over a period of 36 months. In all instances, the Company* may**not* sell shares of its common stock to New Circle under the CSPA if doing so would result in New Circle beneficially owning more than 4.99% of the Company's common stock.

The purchase price per share to be purchased by New Circle shall equal either (i) the lowest volume-weighted average price for common stock over aone-day trading period or intraday trading period on the applicable purchase date multiplied by 96.5%, or (ii) the volume-weighted average price for common stock for thethree consecutive trading days commencing on the purchase notice date multiplied by 97.5%. The maximum number of shares the Company* maysell to New Circle on any single business day is the lesser of (i) the number of shares equal to 100.0% of the average daily trading volume of the common stock of the Company during thefive* trading days immediately preceding the purchase notice, and (ii)400,000 shares of common stock.

In connection with the CSPA, the Company issued to New Circle 225,563 shares of common stock in the Company as commitment shares for the facility. At issuance, the 225,563 shares of common stock had a fair value of $282. The Company also recorded a final cash commitment fee of $200. The fair value of the commitment shares and the final commitment fee were recorded to Interest expense and other in the Company’s condensed consolidated statements of operations and comprehensive loss. The Company determined that the right to sell additional shares represents a freestanding put option under ASC815, Derivatives and Hedging, and as such, the financial instrument was classified as a derivative asset with a fair value ofzero at inception of the CSPA on* July 25, 2024*.

The Company has issued 8,980,713 shares of its common stock to New Circle under the CSPA for gross proceeds totaling $27,754 through* September 30, 2025*.

Alliance Global Partners (“A.G.P.”) At Market Issuance Sales Agreement (the“ATM Agreement”)

On* September 12, 2024*, the Company entered into the ATM and a Registration Rights Agreement with A.G.P. Under the terms and subject to the conditions of the original ATM Agreement, the Company had been allowed to issue and sell through AGP the Company’s common stock having an aggregate offering price of up to $2,600 ("Placement Shares") from time to time through an "at-the-market" equity offering program. In* July 2025,the Company increased the amount of the Company's common stock that it mayissue and sell through A.G.P. under the ATM Agreement to a new aggregate value offering of up to $75,000. The Company has sole discretion to initiate such sales of common stock over a period of 36 months. Under the terms and subject to the conditions of the ATM Agreement, the Company will set the parameters for the sale of shares, including the number or dollar amount of Placement Shares to be issued, the time period during which sales are requested to be made, any limitation on the number or dollar amount of Placement Shares that maybe sold in anyone* trading day and any minimum price below which sales* may**not* be made. The Company will pay a cash commission rate of up to 3.0% of the gross proceeds from the sale of Placement Shares sold pursuant to the ATM Agreement. The Company has sold 20,056,239 shares under the ATM Agreement for gross proceeds totaling $58,462 through* September 30, 2025*.

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The changes in accumulated other comprehensive income (loss) by component for thenine months ended* September 30, 2025and2024* are as follows (in thousands):

The following table sets forth the basic and diluted net loss per share attributable to common stockholders for the periods presented (in thousands, except share amounts and per share data):

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Due to net losses for thenine months ended* September 30, 2025and2024*, basic and diluted net loss per share were the same, as the effect of all potentially dilutive securities would have been anti-dilutive. The following table sets forth the anti-dilutive common share equivalents for the periods listed:

The following table summarizes stock-based compensation expense recorded in each financial statement line item in the Company’s condensed consolidated statements of operations and comprehensive loss for thethree andnine months ended* September 30, 2025and2024* (in thousands):

The Company adopted ASU2023-07 during the year ended* December 31, 2024.The Company hasone reportable segment managed on a consolidated basis by the Chief Executive Officer who is the chief operating decision maker (“CODM”). In identifyingone* reportable segment, the Company considered the basis of organization for the design and development of high-performance, active lidar systems and applications.

The accounting policies of the segment are the same as those described in the summary of significant accounting policies. The CODM assesses performance and decides how to allocate resources based on consolidated net loss as reported in the consolidated statements of operations and comprehensive loss. There areno other expense categories regularly provided to the CODM that arenot already included in the consolidated statements of operations and comprehensive loss. The measure of segment assets is reported on the balance sheet as cash, cash equivalents, and marketable securities.

Sale of Prototypes

The Company recorded revenue for prototype sales of $41 and $63 in thethree andnine months ended* September 30, 2025*, respectively, and $65 and $91 in thethree andnine months ended* September 30, 2024*, respectively. The Company doesnot incur significant contract costs in fulfilling or obtaining its contracts with customers.

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Development Contracts

The Company has entered into research and development contracts as well as a sales, marketing and technical support services contract with companies in both the Automotive and in Non-Automotive markets. The Company assessed the number of performance obligations associated with the promises under each agreement and recognized $9 and $73 in revenue for performance obligations that had been satisfied as of thethree andnine months ended* September 30, 2025*, respectively, and $39 and $65 during thethree andnine months ended* September 30, 2024* in the condensed consolidated statements of operations and comprehensive loss.

Disaggregation of Revenue

The Company recognized the following revenues by geographic area based on the primary billing address of the customer and by the timing of the transfer of goods or services to customers (point in time or over time), as it believes such criteria best depict how the nature, amount, timing, and uncertainty of its revenue and cash flows are affected by economic factors. Total revenue based on the disaggregation criteria described above is as follows (in thousands):

Contract Liabilities

The Company had $0 and $35 in contract liabilities balance as of* September 30, 2025and2024.* There wereno remaining performance obligations as of* September 30, 2025and December 31, 2024.*

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied. It includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods and doesnot include contracts where the customer isnot committed. The customer isnot considered committed where they are able to terminate for convenience without payment of a substantive penalty under the contract. The Company hasnot disclosed the value of unsatisfied performance obligations for contracts with an original expected length ofone year or less. The contract liabilities balance represents the remaining performance obligations for contracts with an original duration of greater thanone year.

In2023, the Company implemented a revised strategic plan, which focused on reducing fixed operating activities by simplifying business operations and focusing development and commercial activities on a single unifying product for both the Automotive and Non-Automotive markets. As part of its effort to reduce fixed operating costs, focus operations, simplify supply chains, and streamline manufacturing, the Company wound down support for its legacy Non-Automotive product. In* August 2024,the Company further reduced fixed operating costs and terminated its headquarters lease and in2025,* settled the amount of the lease termination liability. See discussion in Note5, Leases and Note17, Commitment and Contingencies for further discussion regarding the settlement of the lease termination liability.

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Restructuring charges are summarized as follows for thenine months ended* September 30, 2025* (in thousands):

For thenine months ended* September 30, 2025and2024*, the Company recognized $2 and $2 provision for income taxes, respectively. The income tax rates vary from the federal and state statutory rates due to the valuation allowances on the Company’s net operating losses and foreign tax rate differences. The Company computes its quarterly income tax provision by using a forecasted annual effective tax rate and adjusts for any discrete items arising during the quarter.

Legal matters

The Company* maybe subject to legal proceedings and claims that arise in the ordinary course of business. Litigation can be expensive and disruptive to normal business operations. Moreover, the results of complex legal proceedings are difficult to predict and the Company’s view of these matters may*change in the future as the litigation and events related thereto unfold. The Company expenses legal fees as incurred. The Company records a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

In2025, the Company was notified by a former vendor that it intended to pursue a claim against the Company’s wholly owned subsidiary, AEye Technologies, Inc., arising out of an agreement entered into in* May 2020,*in which the former vendor alleges that AEye Technologies, Inc. failed to pay approximately $3,300 plus interest from the date the former vendor alleges such payments were due. AEye Technologies, Inc. has, and continues to dispute the total amount owed based, in part, on AEye Technologies, Inc.’s claim that the products supplied by the former vendor were largely defective and such former vendor was repeatedly made aware of the existence of such defects.

In2024, the Company was purportedly served with a complaint that (1) alleged the Company was in breach of the lease for its former headquarters office in Dublin, California because of the Company’s failure to pay rent as required by the lease and (2) provided notice that the lease had been terminated by the landlord effective as of* August 23, 2024.The landlord claimed that the amount owed could be up to $8,500. Thereafter, in August 2024,the landlord fully drew down the standby letter of credit of $2,150, which was held as security for the payment of rent, due to the alleged default of the lease. On April 28, 2025,the Company and the former landlord entered into a settlement agreement to resolve all outstanding disputes related to the early termination of the lease. Under the terms of the agreement, the Company paid $1,400 in cash in May 2025and issued warrants to purchase up to 350,000 shares of common stock at an exercise price of $2.22 per share in August 2025.*

Subsequent to* September 30, 2025,*the Company issued 3,164,545 shares of its common stock under the CSPA for total gross proceeds of $9,974.

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