Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 563

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 8
Chunk 563
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 than 50% likelihood
of being realized upon settlement. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense.
See Note 21 Income Taxes to the consolidated financial statements for further information regarding income taxes.

Foreign
Currency 

The
functional currency for the Company’s subsidiaries is determined based on the primary economic environment in which the subsidiary
operates. The Company translates the assets and liabilities of its non-U.S. dollar functional currency subsidiaries into U.S. dollars
using exchange rates in effect at the end of each period. Revenues and expenses for these subsidiaries are translated using rates that
approximate those in effect during the period. Gains and losses from these translations are recognized in cumulative translation adjustment
included in “Accumulated other comprehensive loss” in Stockholders’ equity on the Consolidated Balance Sheets. The
Company remeasures monetary assets and liabilities that are not denominated in the functional currency at exchange rates in effect at
the end of each period. Gains and losses from these remeasurements are recognized in general and administrative expenses in the consolidated
statements of operations. Foreign exchange gains (losses) were immaterial for the years ended December 31, 2024 and 2023, respectively.

Segments

The
Company and its Chief Executive Officer (“CEO”), acting as the Chief Operating Decision Maker (“CODM”) determined
its operating segments in accordance with ASC 280, “Segment Reporting” (“ASC 280”). The Company is organized
and operates as two reporting segments based on similar economic characteristics, the nature of products and production processes, end-use
markets, channels of distribution, and regulatory environments.

Recently
Issued and Adopted Accounting Standards

In
July 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-03,
Presentation of Financial Statements (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities
from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718), which updates codification on how
an entity would apply the scope guidance in paragraph 718-10-15-3 to determine whether profits interest and similar awards should be
accounted for in accordance with Topic 718, Compensation—Stock Compensation. The effective date of this update is for fiscal years
beginning after December 15, 2023, including interim periods within those fiscal years. The Company adopted ASU