What changed in IRIDEX CORP's 10-K — 2023 vs 2024
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Paragraph-level year-over-year comparison of IRIDEX CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.
+191 added−192 removedSource: 10-K (2024-03-29) vs 10-K (2023-03-09)
Top changes in IRIDEX CORP's 2024 10-K
191 paragraphs added · 192 removed · 156 edited across 1 sections
- Item 1A. Risk Factors+191 / −192 · 156 edited
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
156 edited+35 added−36 removed247 unchanged
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
156 edited+35 added−36 removed247 unchanged
2023 filing
2024 filing
Biggest changeFY 2022 FY 2021 December 31, 2022 January 1, 2022 Revenues 100.0 % 100.0 % Cost of revenues 55.5 % 57.6 % Gross margin 44.5 % 42.4 % Operating expenses: Research and development 12.6 % 12.7 % Sales and marketing 31.9 % 27.2 % General and administrative 13.3 % 16.4 % Total operating expenses 57.8 % 56.3 % Loss from operations (13.3 %) (13.9 %) Other income, net 0.1 % 4.3 % Loss from operations before provision for income taxes (13.2 %) (9.6 %) Provision for income taxes 0.1 % 0.1 % Net loss (13.3 %) (9.7 %) Comparison of 2022 and 2021 Revenues (in thousands) FY 2022 FY 2021 Change in $ Change in % Cyclo G6 $ 14,694 $ 13,950 $ 744 5.3 % Retina 31,657 31,106 551 1.8 % Other 10,621 8,847 1,774 20.1 % Total revenues $ 56,972 $ 53,903 $ 3,069 5.7 % 40 Our total revenues increased by $3.1 million or 5.7% from $53.9 million in 2021 to $57.0 million in 2022.
Biggest changeFY 2023 FY 2022 December 30, 2023 December 31, 2022 Total revenues 100.0 % 100.0 % Cost of revenues 58.0 % 55.5 % Gross margin 42.0 % 44.5 % Operating expenses: Research and development 13.2 % 12.6 % Sales and marketing 31.3 % 31.9 % General and administrative 16.9 % 13.3 % Total operating expenses 61.40 % 57.8 % Loss from operations (19.4 %) (13.3 %) Other income, net 1.0 % 0.1 % Loss from operations before provision for income taxes (18.4 %) (13.2 %) Provision for income taxes 0.2 % 0.1 % Net loss (18.6 %) (13.3 %) Comparison of 2023 and 2022 Revenues (in thousands) FY 2023 FY 2022 Change in $ Change in % Cyclo G6 $ 13,461 $ 14,694 $ (1,233 ) (8.4 %) Retina 29,445 31,657 (2,212 ) (7.0 %) Other 8,963 10,621 (1,658 ) (15.6 %) Total revenues $ 51,869 $ 56,972 $ (5,103 ) (9.0 %) 41 Our total revenues decreased by $5.1 million or 9.0% from $57.0 million in 2022 to $51.9 million in 2023.
Regulatory and legal factors • healthcare reform measures; • third-party coverage and reimbursement policies; • compliance with healthcare laws; • our compliance with potential governmental, regulatory and other legal proceedings relative to advertising, promotion and marketing; • patents and proprietary rights related to our intellectual property; • compliance with government regulations, including the FDA’s quality system regulation and laser performance standards; 18 • regulatory approval for clinical trials; • compliance with product liability claims; • developments in trade policies; • tax laws; • federal, state and foreign laws, including changes to those laws; and • environmental requirements.
Regulatory and legal factors • healthcare reform measures and changes in third-party coverage and reimbursement policies; • compliance with healthcare laws; • our compliance with potential governmental, regulatory and other legal proceedings relative to advertising, promotion and marketing; • patents and proprietary rights related to our intellectual property; • compliance with government regulations, including the FDA’s quality system regulation and laser performance standards; 18 • regulatory approval for clinical trials; • compliance with product liability claims; • developments in trade policies; • tax laws; • federal, state and foreign laws, including changes to those laws; and • environmental requirements.
Management’s Discussion and Analysis of Financial Condition and Results of Operations Overview Iridex Corporation is an ophthalmic medical technology company focused on the development and commercialization of breakthrough products and procedures used to treat sight-threatening eye conditions, including glaucoma and retinal diseases. Our propriety MicroPulse® Technology and Endpoint Management Technology are used for the treatment of glaucoma and retina disorders.
Management’s Discussion and Analysis of Financial Condition and Results of Operations Overview IRIDEX is an ophthalmic medical technology company focused on the development and commercialization of breakthrough products and procedures used to treat sight-threatening eye conditions, including glaucoma and retinal diseases. Our propriety MicroPulse ® Technology and Endpoint Management Technology are used for the treatment of glaucoma and retina disorders.
The Monte Carlo simulation model incorporates assumptions for the holding period, risk-free interest rate, stock price volatility and dividend yield. 45 Leases We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use (“ROU”) assets, net and Operating lease liabilities in our consolidated balance sheets.
The Monte Carlo simulation model incorporates assumptions for the holding period, risk-free interest rate, stock price volatility and dividend yield. Leases We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use (“ROU”) assets, net and Operating lease liabilities in our consolidated balance sheets.
There is no continuing obligation after shipment is made to these distributors. We recognize revenue from product sale at a point in time subject to the allocation of transaction price to additional performance obligations, if any. 42 (2) Service Contracts: We offer a standard two-year warranty on all system sales.
There is no continuing obligation after shipment is made to these distributors. We recognize revenue from product sale at a point in time subject to the allocation of transaction price to additional performance obligations, if any. (2) Service Contracts: We offer a standard two-year warranty on all system sales.
If any distributor breaches the terms of its distribution agreement with us or fails to generate sales of our products, we may be forced to replace the distributor and our ability to sell our products into that exclusive sales territory could be adversely affected. We do not have any long-term employment contracts with the members of our direct sales force.
If any distributor breaches the terms of its distribution agreement with us or fails to generate sales of our products, we may be forced to replace the distributor and our ability to sell our products into that exclusive sales territory could be adversely affected. 21 We do not have any long-term employment contracts with the members of our direct sales force.
In addition, we may not realize the expected value from the divestiture of a business or 25 product lines and may need to raise additional capital to replace the revenue generated from the business or product line that is divested. We can provide no assurance that such capital will be available or available on terms that are acceptable to us.
In addition, we may not realize the expected value from the divestiture of a business or product lines and may need to raise additional capital to replace the revenue generated from the business or product line that is divested. We can provide no assurance that such capital will be available or available on terms that are acceptable to us.
These challenges related to acquisitions or investments could adversely affect our business, operating results and financial condition. 32 Our products may be misused, which could harm our reputation and our business. We market and sell our products for use by highly skilled physicians with specialized training and experience in the treatment of eye-related disorders.
These challenges related to acquisitions or investments could adversely affect our business, operating results and financial condition. Our products may be misused, which could harm our reputation and our business. We market and sell our products for use by highly skilled physicians with specialized training and experience in the treatment of eye-related disorders.
To the extent that trade tariffs and other restrictions imposed by the United States increase the price of, or limit the amount of, raw materials and finished goods imported into the United States, the costs of our raw materials may be adversely affected and the demand from our customers for products and services may be diminished, which could adversely affect our revenues and profitability.
To the 33 extent that trade tariffs and other restrictions imposed by the United States increase the price of, or limit the amount of, raw materials and finished goods imported into the United States, the costs of our raw materials may be adversely affected and the demand from our customers for products and services may be diminished, which could adversely affect our revenues and profitability.
For certain of our products, we are responsible for the cost of the fully assembled product that is manufactured by a third-party. Research and development expenses consist primarily of personnel costs, materials to support new product development and research support provided to clinicians at medical institutions developing new applications which utilize our products and regulatory expenses.
For certain of our products, we are responsible for the cost of the fully assembled product that is manufactured by a third-party. 40 Research and development expenses consist primarily of personnel costs, materials to support new product development and research support provided to clinicians at medical institutions developing new applications which utilize our products and regulatory expenses.
Service Contract Sale in Conjunction with System Sale: If the customer opts to purchase a service contract at the time of the system sale, we allocate the transaction price of the distinct performance obligations in the contract by determining stand-alone selling price using historical pricing net of any variable consideration or discounts to specifically allocate to a particular performance obligation. b.
Service Contract Sale in Conjunction with System Sale: If the customer opts to purchase a service contract at the time of the system sale, we allocate the transaction price of the distinct performance obligations in the contract by determining stand-alone selling price using historical pricing net of any variable consideration or discounts to specifically allocate to a particular performance obligation. 43 b.
Under the FD&C Act and the related regulations, the FDA regulates the design, development, clinical 30 testing, manufacture, labeling, sale, distribution and promotion of medical devices. Before a new device can be introduced into the market, the product must be shown to meet regulatory requirements established by the FD&C Act and implemented by the FDA.
Under the FD&C Act and the related regulations, the FDA regulates the design, development, clinical testing, manufacture, labeling, sale, distribution and promotion of medical devices. Before a new device can be introduced into the market, the product must be shown to meet regulatory requirements established by the FD&C Act and implemented by the FDA.
There can be no assurance that our common stock trading price will not suffer declines. Our common stock may experience an imbalance between supply and demand resulting from low trading volumes and therefore broad market fluctuations could have a significant impact on the market price of our common stock regardless of our performance.
There can be no assurance that our common stock trading price will not suffer declines. Our common stock may experience an imbalance between supply and demand resulting from low trading volumes and therefore 35 broad market fluctuations could have a significant impact on the market price of our common stock regardless of our performance.
Lead times for components and fully assembled products vary significantly and depend on numerous factors, including the specific supplier, the size of the order, contract terms and current market demand for such products. If we overestimate the demand for our product, we may have excess inventory, which would increase our costs.
Lead times for components and fully assembled products vary significantly and depend on numerous factors, including the specific supplier, the size of the order, contract terms and current market demand for such products. If 28 we overestimate the demand for our product, we may have excess inventory, which would increase our costs.
Such data security breaches could lead to the loss of trade secrets or other intellectual property, or could lead to the public exposure of sensitive and confidential information of our employees, customers, suppliers and others, any of which could have a material adverse effect on our business, financial condition and results of operations.
Such data security breaches could lead to the loss of trade secrets or other intellectual property, or 29 could lead to the public exposure of sensitive and confidential information of our employees, customers, suppliers and others, any of which could have a material adverse effect on our business, financial condition and results of operations.
As a result, this may lead to a period of regional, national, and global economic slowdown or regional, national, or global recessions that would curtail or delay spending by hospitals and affect demand for our products as well as increase the risk of customer defaults or delays in payments.
As a result, this may lead to a period of regional, national, and global economic slowdown or regional, national, or global recessions that would curtail or delay spending by hospitals and affect demand for 19 our products as well as increase the risk of customer defaults or delays in payments.
Any one or more of these factors stated above could have a material adverse effect on our business, financial condition or results of operations. As we expand our existing international operations, we may encounter new risks in addition to the above factors.
Any one or more of these factors stated above could have a material adverse effect on our business, financial condition or results of operations. 22 As we expand our existing international operations, we may encounter new risks in addition to the above factors.
Cost of revenues consists primarily of our direct manufacturing costs which include the cost of components and sub-systems, assembling, packaging, shipping and testing components at our facility, direct labor and associated overhead, 39 warranty, royalty and amortization of intangible assets and depot service costs.
Cost of revenues consists primarily of our direct manufacturing costs which include the cost of components and sub-systems, assembling, packaging, shipping and testing components at our facility, direct labor and associated overhead, warranty, royalty and amortization of intangible assets and depot service costs.
If there are claims under the indemnification provisions of the Distribution Agreement for which 20 we are liable, we will need to use some or all our cash to settle those claims or make payments to Topcon pursuant to the terms of the Distribution Agreement.
If there are claims under the indemnification provisions of the Distribution Agreement for which we are liable, we will need to use some or all our cash to settle those claims or make payments to Topcon pursuant to the terms of the Distribution Agreement.
The trading price of our common stock has been subject to wide fluctuations in response to a variety of factors, some of which are beyond our control, including changes in foreign currency exchange rates, quarterly variations in our operating results, announcements by us or our competitors of new products or of significant clinical achievements, changes in market valuations of other similar companies in our industry and general market conditions, including deteriorating market conditions due to investor concerns regarding inflation and hostilities between Russia and Ukraine.
The trading price of our common stock has been subject to wide fluctuations in response to a variety of factors, some of which are beyond our control, including changes in foreign currency exchange rates, quarterly variations in our operating results, announcements by us or our competitors of new products or of significant clinical achievements, changes in market valuations of other similar companies in our industry and general market conditions, including deteriorating market conditions due to investor concerns regarding inflation and hostilities between Russia-Ukraine and Israel-Hamas.
If we complete future acquisitions, we may also experience: • difficulties integrating any acquired products into our existing business; • difficulties in integrating an acquired company’s technologies, services, employees, customers, partners, business operations and administrative and software management systems with ours; • delays in realizing the benefits of the acquired products; • diversion of our management’s time and attention from other business concerns; • adverse customer reaction to the product acquisition; and • increases in expenses.
If we complete future acquisitions, we may also experience: • difficulties integrating any acquired products into our existing business; • difficulties in integrating an acquired company’s technologies, services, employees and other service providers, customers, partners, business operations and administrative and software management systems with ours; • delays in realizing the benefits of the acquired products; • diversion of our management’s time and attention from other business concerns; • adverse customer reaction to the product acquisition; and • increases in expenses.
The Distribution Agreement and Topcon’s appointment will, unless terminated earlier, continue on a country-by-country basis for a period of ten (10) years from the date exclusivity is granted.
The Distribution Agreement and Topcon’s appointment will, unless terminated earlier, continue on a country-by-country basis for a period of 10 years from the date exclusivity is granted.
Competition in the market for laser systems and delivery devices used for ophthalmic treatment procedures is intense and is expected to increase. This market is also characterized by technological innovation and change.
Competition in the market for laser systems and delivery devices used for ophthalmic treatment procedures is expected to increase. This market is also characterized by technological innovation and change.
These systems are ideal for multispecialty practices because these lasers also can be used to treat glaucoma, i.e., single-spot laser trabeculoplasty using MicroPulse technology, iridotomy, and iridectomy using the IQ lasers; and pattern scanning laser trabeculoplasty (PSLT) using the PASCAL laser system. • Surgical Retina – Our surgical-retina product line includes our OcuLight ® TX and OcuLight ® SLx (with MicroPulse technology) laser photocoagulation systems.
These systems are ideal for multispecialty practices because these lasers also can be used to treat glaucoma, i.e., single-spot laser trabeculoplasty using MicroPulse technology, iridotomy, and iridectomy using the IQ lasers; and pattern scanning laser trabeculoplasty (“PSLT”) using the PASCAL laser system. • Surgical Retina – Our surgical-retina product line includes our OcuLight ® TX and OcuLight ® SLx (with MicroPulse technology) laser photocoagulation systems.
Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. We are not currently party to any material legal proceedings. I tem 4. Mine Safety Disclosures Not applicable. 37 P ART II I tem 5.
Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. We are not currently party to any material legal proceedings. I tem 4. Mine Safety Disclosures Not applicable. 38 P ART II I tem 5.
Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results. The risk of our being found in violation of these laws is increased by the fact that their provisions are open to a variety of evolving interpretations and enforcement discretion.
Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results. The risk of our operations being found in violation of these laws is increased by the fact that the government’s provisions are open to a variety of evolving interpretations and enforcement discretion.
Material differences may result in the amount and timing of our revenue for any period if management made different judgments or utilized different estimates. Our provision for sales returns is recorded net of the associated costs. Similarly, management must make estimates regarding the uncollectibility of accounts receivable.
Material differences may result in the amount and timing of our revenue for any period if management made different judgments or utilized different estimates. Our provision for sales returns is recorded net of the associated costs. Similarly, management must make estimates regarding the collectibility of accounts receivable.
Unless otherwise exempt, a device manufacturer must obtain marketing “clearance” through the 510(k) premarket notification process, or “approval” through the lengthier premarket approval application (“PMA”) process or other processes such as the “de novo” process. Not all devices are eligible for the 510(k) clearance process.
Unless otherwise exempt, a device manufacturer must obtain marketing “clearance” through the 510(k) premarket notification process, or “approval” through the lengthier pre-market approval application (“PMA”) process or other processes such as the “de novo” process. Not all devices are eligible for the 510(k) clearance process.
There are risks associated with the use of independent manufacturers, including the following: • the impact of macroeconomic conditions, including the COVID-19 pandemic and inflationary pressures on global supply chains and market stability; • unavailability of shortages or limitations on the ability to obtain supplies of components and products in the quantities that we require, or that satisfy the environmental requirements to which we are subject; • delays in delivery or failure of suppliers to deliver critical components and products on the dates we require; • failure of suppliers to manufacture and assemble components and products to our specifications, and potentially reduced quality; and • inability to obtain components and products in a timely manner or at acceptable prices due to global supply chain constraints or other factors.
There are risks associated with the use of independent manufacturers, including the following: • the impact of macroeconomic conditions, including any future global pandemic and inflationary pressures on global supply chains and market stability; • unavailability of shortages or limitations on the ability to obtain supplies of components and products in the quantities that we require, or that satisfy the environmental requirements to which we are subject; • delays in delivery or failure of suppliers to deliver critical components and products on the dates we require; • failure of suppliers to manufacture and assemble components and products to our specifications, and potentially reduced quality; and • inability to obtain components and products in a timely manner or at acceptable prices due to global supply chain constraints or other factors.
Our efforts to market our MicroPulse systems as a fovea-friendly alternative to traditional continuous wavelength systems or alternative treatment methods may result in users failing to implement adequate safety precautions and thereby increase the risks associated with the misuse of our product.
Our efforts to market our MicroPulse systems as a fovea-friendly alternative to traditional continuous wavelength systems or alternative treatment methods may result in users failing to implement adequate safety precautions and thereby increase the risks associated with the misuse of our products.
Our business, results of operation and financial performance have been negatively impacted by the COVID-19 pandemic and related public health responses, such as travel restrictions in countries and regions in which we have operations or manufacturing partners.
Our business, results of operation and financial performance were negatively impacted by the COVID-19 pandemic and related public health responses, such as travel restrictions in countries and regions in which we have operations or manufacturing partners.
However, increases in the value of the U.S. dollars against any local currencies could cause our products to become relatively more expensive to customers in a particular country or region, leading to reduced revenue or profitability in that country or region.
However, increases in the value of the U.S. dollar against any local currencies could cause our products to become relatively more expensive to customers in a particular country or region, leading to reduced revenue or profitability in that country or region.
During uncertain economic times, customers or potential customers may delay, reduce or forego their purchases of our products and services, which may impact our business in a number of ways, including lower prices for our products and services and reducing or delaying sales.
During uncertain economic times, customers or potential customers may delay, reduce or forgo their purchases of our products and services, which may impact our business in a number of ways, including lower prices for our products and services and reducing or delaying sales.
Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. We depend on collaborative relationships to develop, introduce and market new products, product enhancements and new applications.
Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. We depend on collaborative relationships to develop, introduce and market new products, product enhancements and applications. We depend on both clinical and commercial collaborative relationships.
Performance-based RSUs granted with market conditions and performance-based stock options with market conditions are valued using the Monte Carlo simulation model. The Black-Scholes option pricing model requires the use of highly subjective and complex assumptions which determine the fair value of stock-based awards, including the option’s expected term and the price volatility of the underlying stock.
Performance-based restricted stock units granted with market conditions and performance-based stock options with market conditions are valued using the Monte Carlo simulation model. The Black-Scholes option pricing model requires the use of highly subjective and complex assumptions which determine the fair value of stock-based awards, including the option’s expected term and the price volatility of the underlying stock.
On April 30, 2021, the First Amendment to the Triple Net Lease (“First Amendment”) was executed, among other things, that reduced the portion of the premises leased by the Company to approximately 29,830 square feet and extended the lease term through August 31, 2024.
On April 30, 2021, the First Amendment to the Triple Net Lease (“First Amendment”) was executed, among other things, that reduced the portion of the premises leased by the Company to approximately 29,830 square feet and extended the lease term through August 31, 2024. On August 29, 2022 the Second Amendment to the Triple Net Lease (“Second Amendment”) was executed.
We currently intend to retain any earnings for use in our business and do not anticipate paying cash dividends in the foreseeable future. Sales of Unregistered Securities None. Purchases of Equity Securities by the Issuer and Affiliated Purchasers Not applicable. I tem 6.
We currently intend to retain any earnings for use in our business and do not anticipate paying cash dividends in the foreseeable future. Sales of Unregistered Securities None. Purchases of Equity Securities by the Issuer and Affiliated Purchasers Not applicable. I tem 6. [Reserved] 39 I tem 7.
All of our international revenues and costs for the fiscal year 2022 have been denominated in U.S. dollars except for sales transacted through our German subsidiary.
All of our international revenues and costs for the fiscal year 2023 have been denominated in U.S. dollars except for sales transacted through our German subsidiary.
Under ASC 740, an entity may only recognize or continue to recognize tax positions that meet a "more-likely-than-not" threshold. In accordance with our accounting policy, we recognize accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. There was no accrued interest and penalties during the year ended December 31, 2022.
Under ASC 740, an entity may only recognize or continue to recognize tax positions that meet a "more-likely-than-not" threshold. In accordance with our accounting policy, we recognize accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. There was no accrued interest and penalties during the year ended December 30, 2023.
Competition for qualified personnel in our industry and the San Francisco Bay Area, as well as other geographic markets in which we recruit, is intense and characterized by increasing salaries, which may increase our operating expenses or hinder our ability to recruit qualified candidates.
Competition for qualified personnel in our industry and the San Francisco Bay Area, as well as other geographic markets in which we recruit, is highly competitive and characterized by increasing salaries, which may increase our operating expenses or hinder our ability to recruit qualified candidates.
Operational factors • the success of our relationship with our strategic partner and main distributor Topcon; • quality control and production issues; • the complexity of our laser systems; • defects in our laser systems; • direct and independent sales forces and a network of international distributors to sell our products; • our growth; • dependence on international sales; • new products and applications and improving existing products; • fluctuations in our sales and operating results; • the ophthalmology market; • competition in our industry; • the collaborative relationships used to enhance products and applications; • costs, sales volumes, results of operations, and revenues; • the loss of key personnel; • meeting product demand; • dependence on sole source and limited source suppliers; • catastrophic loss; • disruptions to our information technology system and breaches of data security; • maintaining relationships with health care providers; • the misuse of our products; • our reputation and brand; • the inability of our customers to obtain credit or material increases in interest rates; • recalls of our products; and • managing growth effectively.
Operational factors • the success of our relationship with our strategic partner and main distributor Topcon; • quality control and production issues; • the complexity of our laser systems; • defects in our laser systems; • direct and independent sales forces and a network of international distributors to sell our products; • dependence on international sales; • new products and applications and improving existing products; • fluctuations in our sales and operating results; • the ophthalmology market; • competition in our industry; • the loss of key personnel; • the collaborative relationships used to enhance products and applications; • costs, sales volumes, results of operations, and revenues; • meeting product demand; • dependence on sole source and limited source suppliers; • catastrophic loss; • disruptions to our information technology system and breaches of data security; • maintaining relationships with health care providers; • the misuse of our products; • our reputation and brand; • the inability of our customers to obtain credit or material increases in interest rates; • adverse developments affecting financial institutions, including bank failures; • recalls of our products; and • managing growth effectively.
We compete by providing features and services that are valued by our customers such as: enhanced product performance and clinical outcomes, ease of use, durability, versatility, customer training services and rapid repair of equipment. Our principal ophthalmic laser competitors are Alcon Inc., Novartis AG, Bausch Health Companies Inc., Carl Zeiss Meditec AG, Lumenis Ltd., Nidek Co. Ltd., Lumibird, and Norlase.
We compete by providing features and services that are valued by our customers such as: enhanced product performance and clinical outcomes, ease of use, durability, versatility, customer training services and rapid repair of equipment. Our principal ophthalmic laser competitors are Alcon Inc., DORC, Bausch Health Companies Inc., Carl Zeiss Meditec AG, Lumenis Ltd., Nidek Co.
Other parties, including private plaintiffs, also are commonly bringing suit against pharmaceutical and medical device companies, alleging off-label marketing and other violations. We may be subject to liability based on the actions of individual employees and contractors carrying out activities on our behalf, including sales representatives who may interact with healthcare professionals.
Other parties, including private plaintiffs, also are commonly initiating lawsuits against pharmaceutical and medical device companies, alleging off-label marketing and other violations. We may be subject to liability based on the actions of individual employees and contractors carrying out activities on our behalf, including sales representatives who may interact with healthcare professionals.
Our revenue is recognized in accordance with ASC 606, “Revenue from Contracts with Customers.” The Company recognizes revenue using the five-step model: (1) identifying the contract with the customer, (2) identifying the performance obligations in the contract, (3) determining expected transaction price, (4) allocating the transaction price to the distinct performance obligations in the contract, and (5) recognizing revenue when (or as) the performance obligations are satisfied.
Our revenue is recognized in accordance with ASC 606, “Revenue from Contracts with Customers.” We recognize revenue using the five-step model: (1) identifying the contract with the customer, (2) identifying the performance obligations in the contract, (3) determining expected transaction price, (4) allocating the transaction price to the distinct performance obligations in the contract, and (5) recognizing revenue when (or as) the performance obligations are satisfied.
The prior U.S. presidential administration has imposed tariffs on various goods from various countries, including China, Canada and the European Union (“EU”). As a result, Canada, the EU, China and other countries responded with retaliatory tariffs on certain United States exports.
The prior U.S. presidential administration has imposed tariffs on various goods from various countries, including China, Canada and the EU. As a result, Canada, the EU, China and other countries responded with retaliatory tariffs on certain United States exports.
Our international operations and sales are subject to a number of risks and potential costs, including: • macroeconomic conditions, including the impact of the COVID-19 pandemic on the global economy and financial markets; • fluctuations in foreign currency exchange rates; • product and production issues; • performance of our international channel of distributors; • longer accounts receivable collection periods; • impact of recessions in global economies and availability of credit; • political and economic instability; • change in international regulatory agreements and requirements; • trade sanctions and embargoes; 22 • impact of international conflicts, terrorist and military activity, civil unrest; • foreign certification requirements, including continued ability to use the “CE” mark in Europe, and other local regulatory requirements; • differing local product preferences and product requirements; • cultural differences; • changes in foreign medical reimbursement and coverage policies and programs; • reduced or limited protections of intellectual property rights in jurisdictions outside the United States; • potentially adverse tax consequences, such as those related to changes in tax laws or tax rates or their interpretations; • protectionist, adverse and changing foreign governmental laws and regulations; • greater risk of our employees failing to comply with both U.S. and foreign laws, including anti-trust regulations, the U.S.
Our international operations and sales are subject to a number of risks and potential costs, including: • macroeconomic conditions, including the impact of any future global pandemic on the global economy and financial markets; • fluctuations in foreign currency exchange rates; • uncertainty in the global banking and financial services market; • product and production issues; • performance of our international channel of distributors; • longer accounts receivable collection periods; • impact of recessions in global economies and availability of credit; • political and economic instability; • change in international regulatory agreements and requirements ; • trade sanctions and embargoes; • impact of international conflicts, terrorist and military activity, civil unrest; • foreign certification requirements, including continued ability to use the “CE” mark in Europe, and other local regulatory requirements, pending MDR approvals; • differing local product preferences and product requirements; • cultural differences; • changes in foreign medical reimbursement and coverage policies and programs; • reduced or limited protections of intellectual property rights in jurisdictions outside the United States; • potentially adverse tax consequences, such as those related to changes in tax laws or tax rates or their interpretations; • protectionist, adverse and changing foreign governmental laws and regulations; • greater risk of our employees failing to comply with both U.S. and foreign laws, including anti-trust regulations, the U.S.
As of December 31, 2022 and January 1, 2022, we recognized deferred costs incurred to obtain revenue contracts with customers, net of accumulated amortization, of $0.2 million and $0, respectively, and included these amounts in Prepaid expenses and other current assets and Other long-term assets in our consolidated balance sheets.
As of December 30, 2023 and December 31, 2022, we recognized deferred costs incurred to obtain revenue contracts with customers, net of accumulated amortization, of $0.2 million and $0.2 million, respectively, and included these amounts in Prepaid expenses and other current assets and Other long-term assets in our consolidated balance sheets.
We believe that continued and increased sales, if any, of these medical laser systems is dependent upon a number of factors including the following: • the impact of COVID-19 pandemic on timing of ophthalmic treatment procedures; • acceptance of product performance, features, ease of use, scalability and durability, including with respect to our MicroPulse laser photocoagulation systems, and our PASCAL product; • recommendations and opinions by ophthalmologists, other clinicians, and their associated opinion leaders; • marketing and clinical study outcomes; • price of our products and prices of competing products and technologies, particularly in light of the current macro-economic environment where healthcare systems and healthcare operators are becoming increasingly price sensitive; • availability of competing products, technologies and alternative treatments; and • level of reimbursement for treatments administered with our products.
We believe that continued and increased sales, if any, of these medical laser systems is dependent upon a number of factors including the following: • the impact of any future resurgence any future global pandemic or other public health emergencies on timing of ophthalmic treatment procedures; • acceptance of product performance, features, ease of use, scalability and durability, including with respect to our MicroPulse laser photocoagulation systems, and our PASCAL product; • recommendations and opinions by ophthalmologists, other clinicians, and their associated opinion leaders; • marketing and clinical study outcomes; 25 • price of our products and prices of competing products and technologies, particularly in light of the current macro-economic environment where healthcare systems and healthcare operators are becoming increasingly price sensitive; • availability of competing products, technologies and alternative treatments; and • level of reimbursement for treatments administered with our products.
The volatile macroeconomic environment, including the COVID-19 pandemic has created economic uncertainty and volatility in the financial markets around the world, resulting in an economic downturn that has affected and may likely continue to affect demand for our products and impact our results of operations.
The volatile macroeconomic environment has created economic uncertainty and volatility in the financial markets around the world, resulting in an economic downturn that has affected and may likely continue to affect demand for our products and impact our results of operations.
The ultimate impact of the volatile macroeconomic conditions, including the COVID-19 pandemic, on our operations and financial performance depends on many factors that are not within our control, including, but not limited, to: the recommendations by medical authorities on whether hospitals should and may perform elective surgical procedures; hospitals abilities and willingness to devote resources to elective surgical procedures; governmental, business and individuals’ actions that have been and continue to be taken in response to the COVID-19 pandemic (including restrictions on travel and transport and workforce pressures); the impact of the COVID-19 pandemic and actions taken in response on global and regional economies, travel, and economic activity; the availability of federal, state, local or non-U.S. funding programs; general economic uncertainty in key global markets and financial market volatility; global economic conditions and levels of economic growth; and the pace of recovery when the current volatile macroeconomic conditions, including the impact of the COVID-19 pandemic, subside.
The ultimate impact of the volatile macroeconomic conditions on our operations and financial performance depends on many factors that are not within our control, including, but not limited, to: the recommendations by medical authorities on whether hospitals should and may perform elective surgical procedures; hospitals’ abilities and willingness to devote resources to elective surgical procedures; governmental, business and individuals’ actions that have been and may continue to be taken in response to any future resurgence of the COVID-19 pandemic or other public health emergencies or outbreaks (including restrictions on travel and transport and workforce pressures); the impact of other public health emergencies or any future outbreak of disease and actions taken in response on global and regional economies, travel, and economic activity; the availability of federal, state, local or non-U.S. funding programs; general economic uncertainty in key global markets and financial market volatility; global economic conditions and levels of economic growth; and the pace of recovery when the current volatile macroeconomic conditions subside.
Currently our 21 direct and independent sales forces within the United States consist of approximately 28 employees and two independent representatives, respectively, and our direct sales force in Germany consists of one employee. Our international independent distributors are managed by a team of seven people.
Currently our direct and independent sales forces within the United States consist of approximately 30 employees and one independent representatives, respectively, and our direct sales force in Germany consists of one employee. Our international independent distributors are managed by a team of seven people.
During fiscal years ended 2022 and 2021, $1.3 million and $0.6 million in revenue related to the exclusive distribution rights was recorded, respectively. Costs of Obtaining Revenue Contracts We recognized assets from certain costs incurred to obtain revenue contracts. These costs relate to sales commissions arising from the sale of our products.
During fiscal years ended 2023 and 2022, $1.5 million and $1.3 million in revenue related to the exclusive distribution rights was recorded, respectively. Costs of Obtaining Revenue Contracts We recognized assets from certain costs incurred to obtain revenue contracts. These costs relate to sales commissions arising from the sale of our products.
As of December 31, 2022, we were not a party to finance lease arrangements. ROU 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.
As of December 30, 2023, we were not a party to finance lease arrangements. ROU 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.
We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. The allowance for doubtful accounts is based on past payment history with the customer, analysis of the customer’s current financial condition, the aging of the accounts receivable balance, customer concentration and other known factors.
We maintain provision for credit losses for estimated losses resulting from the inability of our customers to make required payments. The provision for credit losses is based on past payment history with the customer, analysis of the customer’s current financial condition, the aging of the accounts receivable balance, customer concentration and other known factors.
There are several major regulatory changes occurring in the regulation of medical devices in the EU. The revision of the quality system regulation (ISO 13485:2016) has been released that substantially increased the requirements for a medical device quality system.
There are several major regulatory changes occurring in the regulation of medical devices in the European Union (the “EU”). The revision of the quality system regulation (ISO 13485:2016) has been released that substantially increased the requirements for a medical device quality system.
Total revenues in 2022 and 2021 were $57.0 million and $53.9 million, respectively. We generated net losses of $7.5 million and $5.2 million in 2022 and 2021, respectively. Sales to international distributors are made on open credit terms or letters of credit and are currently denominated in U.S. dollars and accordingly, are not subject to risks associated with currency fluctuations.
Total revenues in 2023 and 2022 were $51.9 million and $57.0 million, respectively. We generated net losses of $9.6 million and $7.5 million in 2023 and 2022, respectively. Sales to international distributors are made on open credit terms or letters of credit and are currently denominated in U.S. dollars and accordingly, are not subject to risks associated with currency fluctuations.
As of December 31, 2022, based on our recent history of losses and its forecasted losses, management believes on the more likely than not basis that a full valuation allowance is required. Accordingly, as of December 31, 2022, we provided a full valuation allowance on our federal and state deferred tax assets.
As of December 30, 2023, based on our recent history of losses 45 and its forecasted losses, management believes on the more likely than not basis that a full valuation allowance is required. Accordingly, as of December 30, 2023, we provided a full valuation allowance on our federal and state deferred tax assets.
The Distribution Agreement includes customary termination rights and effects of termination, including a termination for convenience right in favor of Topcon and, subject to payment of a fee, a termination right in our favor upon a change of control of our company.
The Distribution Agreement includes customary termination rights and effects of termination, including a termination for convenience right in favor of Topcon and, subject to payment of a fee, a termination right in our favor upon a change of control of our company, as well as customary indemnification provisions.
On March 2, 2021, we entered into a series of strategic transactions with Topcon, Topcon America Corporation (the “Investor”) and Topcon Medical Laser Systems, Inc., a subsidiary of Topcon (“TMLS”), which included an asset purchase agreement with TMLS, pursuant to which we acquired substantially all the assets (except for cash and cash equivalents) of TMLS, including rights to the PASCAL product (as defined in Note 3 of the Notes to Consolidated Financial Statements) (the “Asset Purchase Agreement”), (ii) Topcon and our company entered into a distribution agreement dated March 2, 2021, pursuant to which we granted Topcon the exclusive right to distribute our retina and glaucoma products in certain geographies outside the United States (the “Distribution Agreement”), (iii) pursuant to an investment agreement dated March 2, 2021 (the “Investment Agreement”) the Investor acquired 1,618,122 shares of the our Common Stock for an aggregate purchase price of $10 million (the “Shares”).
On March 2, 2021, we entered into a series of strategic transactions with Topcon, Topcon America Corporation (the “Investor”) and Topcon Medical Laser Systems, Inc., a subsidiary of Topcon (“TMLS”), which included (i) an asset purchase agreement with TMLS, pursuant to which we acquired substantially all the assets (except for cash and cash equivalents) of TMLS, including rights to the PASCAL product (the “Asset Purchase Agreement”), (ii) a distribution agreement dated March 2, 2021, pursuant to which we granted Topcon the exclusive right to distribute our retina and glaucoma products in certain geographies outside the United States (the “Distribution Agreement”), and (iii) an investment agreement dated March 2, 2021 (the “Investment Agreement”), pursuant to which we sold the Investor 1,618,122 shares of our common stock for an aggregate purchase price of $10 million.
As of December 31, 2022 and January 1, 2022, we recognized deferred costs incurred to fulfill a contract with a customer, net of accumulated amortization, of $0.8 million and $0.3 million, respectively, and included these amounts in Prepaid expenses and other current assets and Other long-term assets in the Company’s consolidated balance sheets.
As of December 30, 2023 and December 31, 2022, we recognized deferred costs incurred to fulfill a contract with a customer, net of accumulated amortization, of $0.7 million and $0.8 million, respectively, and included these amounts in Prepaid expenses and other current assets and Other long-term assets in the Company’s consolidated balance sheets.
Gross margins are expected to fluctuate due to changes in the relative proportion of domestic and international sales, the product mix of sales, introduction of new products, manufacturing variances, total unit volume changes that lead to greater or lesser production efficiencies.
Gross margins may fluctuate due to changes in the relative proportion of domestic and international sales, the product mix of sales, introduction of new products, manufacturing variances, total unit volume changes that lead to greater or lesser production efficiencies and other factors.
In the offices and clinics, ophthalmologists use our laser systems with either an indirect laser ophthalmoscope or a slit-lamp adapter. In 2022 and 2021, our products were sold in the United States and Germany predominantly through a direct sales force and internationally (aside from Germany) primarily through Topcon Corporation (“Topcon”) and other independent distributors.
In the offices and clinics, ophthalmologists use our laser systems with either an indirect laser ophthalmoscope or a slit-lamp adapter. In 2023 and 2022, our products were sold in the United States and Germany predominantly through a direct sales force and internationally (aside from Germany) primarily through independent distributors.
Factors contributing to these fluctuations include the following: • general macroeconomic conditions, including inflationary pressures and political concerns, rising interest rates, the impact of the COVID-19 pandemic, and the war between Russia and Ukraine; • changes in the prices at which we can sell our products, including the impact of changes in exchange rates; • introduction of new products, product enhancements and new applications by our competitors, including new drugs, entry of new competitors into our markets, pricing pressures and other competitive factors; • any delays or reductions in product shipments, or product recalls, resulting from manufacturing, distribution or other operational issues; • the timing of the introduction and market acceptance of new products, product enhancements and new applications; • changes in demand for our existing line of ophthalmology products; • the cost and availability of components and subassemblies, including the willingness and ability of our sole or limited source suppliers to timely deliver components at the times and prices that we have planned; • our ability to maintain sales volumes at a level sufficient to cover fixed manufacturing and operating costs; • fluctuations in our product mix within ophthalmology products and foreign and domestic sales; • the effect of regulatory approvals and changes in domestic and foreign regulatory requirements; • our long and highly variable sales cycle; • changes in customers’ or potential customers’ budgets as a result of, among other things, reimbursement policies of government programs and private insurers for treatments that use our products; • variances in shipment volumes as a result of product, supply chain due to global constraints or other factors and training issues; and • increased product innovation costs.
Factors contributing to these fluctuations include the following: • general macroeconomic conditions, including inflationary pressures and heightened interest rates, uncertainty in the global banking and financial services market, potential federal government shutdown, global pandemics and responsive measures and the wars between Russia-Ukraine and Israel-Hamas; • changes in the prices at which we can sell our products, including the impact of changes in foreign currency exchange rates; • introduction of new products, product enhancements and new applications by our competitors, including new drugs, entry of new competitors into our markets, pricing pressures and other competitive factors; • any delays or reductions in product shipments, or product recalls, resulting from manufacturing, distribution or other operational issues; • the timing of the introduction and market acceptance of new products, product enhancements and new applications; • changes in demand for our existing line of ophthalmology products; • the cost and availability of components and subassemblies, including the willingness and ability of our sole or limited source suppliers to timely deliver components at the times and prices that we have planned; • our ability to maintain sales volumes at a level sufficient to cover fixed manufacturing and operating costs; • fluctuations in our product mix within ophthalmology products and foreign and domestic sales; • the effect of regulatory approvals and changes in domestic and foreign regulatory requirements; • our long and highly variable sales cycle; • changes in customers’ or potential customers’ budgets as a result of, among other things, reimbursement policies of government programs and private insurers for treatments that use our products; • variances in shipment volumes as a result of product, supply chain due to global constraints or other factors and training issues; and • increased product innovation costs.
Market for Registrant’s Common Equity and Related Stockholder Matters, and Issuer Purchases of Equity Securities Market Information for Common Equity Our common stock is currently quoted on the Nasdaq Global Market under the symbol “IRIX”. As of March 2, 2023, there were approximately 33 holders of record (not in street name) of our common stock.
Market for Registrant’s Common Equity and Related Stockholder Matters, and Issuer Purchases of Equity Securities Market Information for Common Equity Our common stock is currently quoted on the Nasdaq Global Market under the symbol “IRIX”. As of February 29, 2024, there were approximately 33 holders of record (not in street name) of our common stock.
The macroeconomic conditions on our business and operations remains highly uncertain, and it is not possible for us to predict the duration and extent to which they will affect our business, future results of operations, and financial condition. For more information on risks associated with the COVID-19 pandemic, see the section titled “Risk Factors” in Item 1A of Part I.
The macroeconomic conditions on our business and operations remains uncertain, and it is not possible for us to predict the duration and extent to which they will affect our business, future results of operations, and financial condition. For more information on risks associated with the current macroeconomic conditions, see the sections titled “Risk Factors” in Item 1A of Part I.
Due to these impacts and measures, we have experienced and may continue to experience significant and unpredictable interruptions in the supply of raw materials, components and sub-assemblies necessary to manufacture and assemble our products and reductions in the demand for our products as healthcare customers continue to divert medical resources and priorities towards the treatment of COVID-19.
Due to these impacts and measures, we have experienced and may continue to experience significant and unpredictable interruptions in the supply of raw materials, components and sub-assemblies necessary to manufacture and assemble our products and reductions in the demand for our products if healthcare customers divert medical resources and priorities towards the treatment of COVID-19 or any future outbreak of disease.
Factors influencing these adjustments include changes in demand, product life cycle and development plans, component cost trends, product pricing, physical deterioration and quality issues. Revisions to these adjustments would be required if these factors differ from our estimates. 44 Sales Returns Allowance and Allowance for Doubtful Accounts We estimate future product returns related to current period product revenue.
Factors influencing these adjustments include changes in demand, product life cycle and development plans, component cost trends, product pricing, physical deterioration and quality issues. Revisions to these adjustments would be required if these factors differ from our estimates. Provision for Credit Loss and Sales Returns We estimate future sales returns related to current period product revenue.
We may need in the future to raise additional funds through future equity or debt financings to meet our operational needs and capital requirements for product development, clinical trials and commercialization and may subsequently require additional fundraising. Additional financing may not be available on favorable terms, if at all.
Our business and operations may consume resources faster than we anticipate. We may need in the future to raise additional funds through future equity or debt financings to meet our operational needs and capital requirements for product development, clinical trials and commercialization and may subsequently require additional fundraising. Additional financing may not be available on favorable terms, if at all.
Amortization expense was $36 thousand and $0, respectively, for the fiscal years ended December 31, 2022 and January 1, 2022. There were no impairment expenses for both the fiscal years ended December 31, 2022 and January 1, 2022, respectively. Sales commissions that do not represent incremental and recoverable costs of obtaining a contract are expensed as incurred.
Amortization expense was $105 thousand and $36 thousand, respectively, for the fiscal years ended December 30, 2023 and December 31, 2022. There were no impairment expenses for both the fiscal years ended December 30, 2023 and December 31, 2022, respectively. 44 Sales commissions that do not represent incremental and recoverable costs of obtaining a contract are expensed as incurred.
We derive, and expect to continue to derive, a large portion of our revenues from international sales. For the fiscal year 2022, our international sales were $27.8 million, or 48.8% of total revenues. We anticipate that international sales will continue to account for a significant portion of our revenues in the foreseeable future.
We derive, and expect to continue to derive, a large portion of our revenues from international sales. For the fiscal year 2023, our international sales were $25.8 million, or 49.8% of total revenues. We anticipate that international sales will continue to account for a significant portion of our revenues in the foreseeable future.
In addition, as of December 31, 2022, we have 11 patent applications pending in the United States and 21 international patent applications pending. Our patent applications may not be approved. Any patents granted now or in the future may offer only limited protection against potential infringement and development by our competitors of competing products.
In addition, as of December 30, 2023, we have 12 patent applications pending in the United States and 18 international patent applications pending. Our patent applications may not be approved. Any patents granted now or in the future may offer only limited protection against potential infringement and development by our competitors of competing products.
Our facilities could be subject to catastrophic loss such as fire, flood, unpredictable power outages, or earthquake. All of our research and development activities, manufacturing, our corporate headquarters and other critical business operations are located near major earthquake faults in Mountain View, California. California can experience earthquakes, catastrophic wildfires, and intermittent power outages.
If our facilities were to experience catastrophic loss, our operations would be seriously harmed. Our facilities could be subject to catastrophic loss such as fire, flood, unpredictable power outages, or earthquake. All of our research and development activities, manufacturing, our corporate headquarters and other critical business operations are located near major earthquake faults in Mountain View, California.
Results of Operations - 2022 and 2021 Our fiscal year ends on the Saturday closest to December 31. Fiscal 2022 ended on December 31, 2022 and fiscal 2021 ended on January 1, 2022. Fiscal years 2022 and 2021 each included 52 weeks of operations.
Results of Operations - 2023 and 2022 Our fiscal year ends on the Saturday closest to December 31. Fiscal 2023 ended on December 30, 2023 and fiscal 2022 ended on December 31, 2022. Fiscal years 2023 and 2022 each included 52 weeks of operations.
Although the magnitude of the impact of the COVID-19 pandemic on our business operations remains uncertain and difficult to predict, and this remains a highly dynamic situation, we have experienced and will continue to experience in subsequent periods, disruptions to our business that will likely continue to adversely impact our business, financial condition and results of operations.
Although the magnitude of the impact of the COVID-19 pandemic on our business operations remains a dynamic situation, we have experienced and may continue to experience in subsequent periods, disruptions to our business that may adversely impact our business, financial condition and results of operations .
We file patent applications to protect technology, inventions and improvements that are significant to the development of our business. As of December 31, 2022, our patent portfolio includes 62 active United States patents and 85 active international patents on the technologies related to our products and processes.
We file patent applications to protect technology, inventions and improvements that are significant to the development of our business. As of December 30, 2023, our patent portfolio includes 66 active United States patents and 84 active international patents on the technologies related to our products and processes.
During 2022, net cash used in financing activities was $0.1 million, primarily from payroll taxes related to net share settlement of equity awards partially offset by the net proceeds arising from the proceeds from stock option exercises.
During 2023, net cash used in financing activities was $5 thousand, primarily from payroll taxes related to net share settlement of equity awards partially offset by the net proceeds arising from the proceeds from stock option exercises.
Any loss of the members of our existing direct or indirect sales organizations, or any failure to execute on our plans to further develop our sales function, could have an adverse impact on our business, results of operations and financial condition.
Any loss of the members of our existing direct or indirect sales organizations, or any failure to execute on our plans to further develop our sales function, could have an adverse impact on our business, results of operations and financial condition. We depend on international sales for a significant portion of our operating results.
During 2022, the company added approximately $3.5 million to inventory and prepaid materials to mitigate supply chain constraints, which are expected to unwind throughout 2023. During 2022, net cash used in investing activities was $0.3 million for capital expenditures.
During 2022, the company added approximately $3.5 million to inventory and prepaid materials to mitigate supply chain constraints, which were resolved in 2023. During 2023, net cash used in investing activities was $109 thousand for capital expenditures. During 2022, net cash used in investing activities was $0.3 million for capital expenditures.
Other Income, Net Other income, net amounted to $60 thousand in 2022 and $2.3 million in 2021. Other income, net, consisted primarily of interest income or expense and foreign currency gain or loss.
Other Income, Net Other income, net amounted to $0.5 million in 2023 and $60 thousand in 2022. Other income, net, consisted primarily of interest income or expense and foreign currency gain or loss.
Amortization expense was $62 thousand and $0, respectively, for the fiscal years ended December 31, 2022 and January 1, 2022. There were no impairment expenses for both the fiscal years ended December 31, 2022 and January 1, 2022, respectively.
Amortization expense was $83 thousand and $62 thousand, respectively, for the fiscal years ended December 30, 2023 and December 31, 2022. There were no impairment expenses for both the fiscal years ended December 30, 2023 and December 31, 2022, respectively.
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