Company: CNTB
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001835268-25-000052
Chunk: 11

Company: Connect Biopharma Holdings Ltd
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 1
Chunk 11
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 invoice amount, net of an allowance for credit losses. The allowance for credit losses reflects accounts receivable balances that are believed to be uncollectible. In estimating the allowance for credit losses, we consider: (1) our historical experience with collections and write-offs; (2) the credit quality of our customers and any recent or anticipated changes thereto; (3) the outstanding balances and past due amounts from our customers; and (4) reasonable and supportable forecast of economic conditions expected to exist throughout the contractual term of the receivable.

10

As of June 30, 2025 and December 31, 2024, we determined that an allowance for credit losses was not required. For the three and six months ended June 30, 2025 and 2024, we did not have any material write-offs of accounts receivable balances.Share-Based Compensation ExpenseOn January 1, 2025, we began using the Black-Scholes option pricing model to estimate the fair value of each option grant on the grant date, in order to better align with our peers. Prior to 2025, we estimated the fair value of each option grant on the grant date using the Binomial option pricing model. This fair value is then amortized using the straight-line single-option method of attributing the value of share-based compensation to expense over the requisite service periods of the awards. Forfeitures are accounted for, as incurred, as a reversal of share-based compensation expense related to awards that will not vest. The fair value of each employee share purchase right is estimated on the grant date using the Black-Scholes option pricing model. The estimated fair value of each purchase right is then expensed on a straight-line basis over the requisite service period, which is generally the purchase period. The Black-Scholes option pricing model requires inputs of subjective assumptions, including each option’s expected life and price volatility of the underlying shares.Net Income (Loss) per ShareBasic net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of ordinary shares outstanding for the period. Diluted net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of ordinary shares and ordinary share equivalents outstanding for the period determined using the treasury share method. For purposes of this calculation, stock options and employee share purchase rights are considered to be ordinary share equivalents and are included in the calculation of diluted net income (loss) per share only when their effect is dilutive