Company: XTIA
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076767
Chunk: 22

Company: XTI Aerospace, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 22
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(2)Professional services are also contracted on the fixed fee and time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date, in which revenue is recognized over time.

(3)Software As A Service Revenue’s performance obligation is satisfied evenly over the service period using a time-based measure because the Company is providing continuous access to its service and revenue is recognized over time.

15

XTI AEROSPACE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Deferred revenue

As of December 31, 2024 and June 30, 2025,
the Company had approximately $0.5 million and $1.0 million, respectively, in deferred revenue. This deferred revenue balance relates
to cash received in advance for product maintenance services and professional services provided by the Company’s technical staff.
The fair value of the deferred revenue approximates the services to be rendered. The Company expects to satisfy its remaining performance
obligations for these maintenance services and professional services and recognize the deferred revenue and related contract costs over
the next twelve months.

Note 5 - Proforma Financial Information

The XTI Merger was accounted for as a reverse merger under U.S. GAAP.
For financial reporting purposes, Legacy Inpixon is treated as the “acquired” company. As a result, the Company’s consolidated
financial statements include the operating results of Legacy Inpixon only from March 12, 2024, the merger closing date. The following
unaudited proforma financial information presents the consolidated results of operations of the Company and Legacy Inpixon for the three
months and six months ended June 30, 2024, as if the XTI Merger had occurred as of the beginning of the first period presented (January
1, 2024) instead of on March 12, 2024. The proforma information does not necessarily reflect the results of operations that would have
occurred had the entities been a single company during those periods.

The proforma financial information for the Company
and Legacy Inpixon is as follows (in thousands):

    For the Three Months Ended  June 30, 2024  
    For the  Six Months Ended  June 30,