Company: FTCI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0000950170-25-047224
Chunk: 280

Company: FTC Solar, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 7
Chunk 280
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 to (i) our revenue for both products and services being insufficient to fully cover our indirect and warehousing costs (ii) higher remediation costs, and (iii) changes in project mix and cost of freight.

We had positive gross margin for the year ended December 31, 2023 as our production volumes were sufficient to cover our overhead costs. This more than offset slightly negative service margins due mainly to warehousing costs.

Research and development

Research and development expenses consist primarily of salaries, employee benefits, stock-based compensation and travel expenses related to our engineers performing research and development activities to originate, develop and enhance our products. Additional expenses include consulting charges, component purchases, testing services and other costs for performing research and development on our software products.

    Year ended December 31,

    (in thousands)
     
    2024

    2023

    $ Change

    % Change

    Research and development
     
    $
    5,915

    $
    7,166

    $
    (1,251
    )

    (17.5
    %)

The decrease in research and development expenses in 2024, as compared to 2023, was primarily due to (i) lower spending of nearly $0.5 million on lab activity and materials, (ii) lower payroll-related costs of $0.4 million, largely due to the impact of employee terminations and severance costs recognized in 2023, (iii) $0.2 million of lower stock-based compensation expense and, (iv) lower research facility and software license costs of $0.2 million. Research and development expenses as a percentage of revenue were 12.5% for the year ended December 31, 2024, compared to 5.6% for the year ended December 31, 2023. The increase in the percentage of research and development costs to revenue for 2024 was largely a function of the lower level of revenue.

Selling and marketing

Selling and marketing expenses consist primarily of salaries, employee benefits, stock-based compensation expenses and travel expenses related to our sales and marketing and business development personnel. Additionally, selling and marketing expenses include costs associated with professional fees and support charges for software subscriptions and licenses, trade shows and conventions. 

47

    Year ended December 31,

    (in thousands)
     
    2024

    2023

    $ Change

    % Change

    Selling and marketing
     
    $