Quarterly report pursuant to Section 13 or 15(d)

Summary of Significant Accounting Policies (Tables)

v3.23.3
Summary of Significant Accounting Policies (Tables)
9 Months Ended
Sep. 30, 2023
Accounting Policies [Abstract]  
Concentrations of credit risk The net sales to the following customers comprised more than 10% of revenues for the periods presented.
Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
Net Sales % of Net Revenue Net Sales % of Net Revenue Net Sales % of Net Revenues Net Sales % of Net Revenues
Customer A $ 4,976  39  % $ —  —  % $ 9,157  37  % $ —  —  %
Customer B 2,826  22  % —  —  % 3,840  16  % —  —  %
Customer C —  —  % 5,920  53  % —  —  % 5,923  29  %
Customer D —  —  % 2,075  19  % —  —  % 2,075  10  %
Customer E —  —  % 1,098  10  % —  —  % 2,822  14  %
Customer F —  —  % —  —  % —  —  % 2,675  13  %
Total of customers with sales greater than 10% $ 7,802  61  % $ 9,093  82  % $ 12,997  53  % $ 13,495  66  %
Total of customers with sales less than 10% 4,888  39  % 2,038  18  % 11,429  47  % 6,584  34  %
Gross Revenue $ 12,690  100  % $ 11,131  100  % $ 24,426  100  % $ 20,079  100  %
Customer refunds(1)
(324) —  (2,833) — 
Total Revenue, net of customer refunds $ 12,366  $ 11,131  $ 21,593  $ 20,079 

(1)    Customer refunds are related to the recall for certain 2021-2022 model year FE4-129 vehicles (“ZEV4”) that were manufactured with Romeo Power Systems, Inc (“Romeo”) battery packs. See section “Revenue Recognition” below for more detail concerning the accounting treatment and the section “Warranties and Recall Campaigns” for more detail on the recall.
Schedule of allowance for doubtful accounts activity
The following table details the change in the allowance for credit losses for the periods indicated:
Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
Balance at beginning of period $ 2,041 $ 3,847 $ 2,028 $ 3,349
Credit loss expense (1)
45 1,733 1,987 2,231
Deductions (1)
(3,780) (1,929) (3,780)
Balance at end of period $ 2,086 $ 1,800 $ 2,086 $ 1,800
(1) The charges to expense and deductions in the allowance for doubtful accounts during the nine months ended September 30, 2023 were primarily associated with two customers. The customers have not paid and the Company repossessed the vehicles as collateral for the accounts receivable balance. The charges to expense represent further impairment of the receivable balance down to the net realizable value of the collateral. The deductions represent the write off of the remaining accounts receivable balance related to these customers after applying the net realizable value of the collateral against the outstanding balance.
Schedule of disaggregates revenue by major source
The following table disaggregates revenue by major source:
Three Months Ended September 30, Nine Months Ended September 30,
2023 2022 2023 2022
ZEVs $ 12,127 $ 10,570 $ 23,234 $ 18,969
Other 563 561 1,192 1,110
Gross Revenue $ 12,690 $ 11,131 $ 24,426 $ 20,079
Customer refunds(1)
(324) (2,833)
Total Revenue, net of customer refunds $ 12,366 $ 11,131 $ 21,593 $ 20,079
(1) Customer refunds are related to the recall for ZEV4 vehicles that were manufactured with Romeo battery packs.
Schedule of changes in contract balances Changes in contract liabilities are as follows:
Balance as of December 31, 2022
$ 794 
Revenues recognized (5,474)
Increase due to billings 5,466 
Balance as of September 30, 2023
$ 786 
The following table summarizes the Company’s contract balances:
September 30,
2023
December 31,
2022
January 1,
2022
Accounts receivable, net of allowance of $2,086, $2,028 and $3,349 as of September 30, 2023, December 31, 2022 and January 1, 2022, respectively
$ 9,747 $ 9,899 $ 9,172
Contract Liabilities - Current 786 794 147
Schedule of fair value hierarchy
The following tables set forth by level within the fair value hierarchy the Company’s financial assets and liabilities that were measured at fair value on a recurring basis in the consolidated balance sheets.
Level 1 Level 2 Level 3
As of September 30, 2023
Financial assets
Cash equivalents $ 4,065  $ —  $ — 
Financial Liabilities    
Derivative liability —  —  355 
As of December 31, 2022
Financial assets
Cash equivalents $ 51,351  $ —  $ — 
Financial Liabilities    
Warrant liability $ —  $ —  $ 60 
Derivative liability —  —  78 
Earnout liability —  —  2,265 
Schedule of earnout liability The following table provides a reconciliation of the beginning and ending balances for the earnout liability measured at fair value using significant unobservable inputs (Level 3):
September 30, 2023
Balance at beginning of period $ 2,265 
(Gain) loss (2,265)
Balance at end of period $ —