Company: MVIS
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0001641172-25-000783
Chunk: 28

Company: MICROVISION, INC.
Filing Date: 2025-03-26
Form: 10-K
Item: Item 1A
Chunk 28
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) is determined by the closing price of our common stock on the grant date or the period end date for the awards that are being measured
by the service inception date. Executive PSUs issued in 2022 were valued using a Monte Carlo simulation model using the following inputs:
stock price, volatility, and risk-free interest rates. Changes in estimated inputs or using other option valuation methods may result
in materially different option values and share-based compensation expense.

Leases

Significant
judgment may be required when determining whether a contract contains a lease, the length of the lease term, the allocation of the consideration
in a contract between lease and non-lease components, and the determination of the discount rate included in our office lease. We review
the underlying objective of each contract, the terms of the contract, and consider our current and future business conditions when making
these judgments.

Derivative
Liability

We
evaluate our financial instruments, specifically, our notes payable, to determine if such instruments are derivatives or contain features
that qualify as embedded derivatives in accordance with ASC 815, “Derivatives and Hedging”. For derivative financial instruments
that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the issuance date and is
then re-valued at each reporting date, with changes in the fair value reported as an unrealized gain or loss in earnings on the consolidated
statements of operations.

Results
of Operations 

Revenue

    2024  
    2023  
    $
    change  
    %
    change 
  
    (In thousands) 

    Revenue 
    $4,696  
    $7,259  
     (2,563) 
     (35.3)

Revenues
are recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration
that we expect to receive in exchange for those goods or services. We recognize revenue either at a point in time, or over time, depending
upon the characteristics of the individual contract. If control of the deliverable(s) transfers over time, the revenue is recognized
in proportion to the transfer of control. If control passes to the customer only upon completion and transfer of the asset, revenue is
recognized at the completion of the contract.

The
decrease in revenue for the year ended December 31, 2024 compared to the same period in 2023 was primarily due to revenue associated
with the Microsoft contract partially