Company: XTIA
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112615
Chunk: 166

Company: XTI Aerospace, Inc.
Filing Date: 2025-11-19
Form: 10-Q
Item: Part I, Item 8
Chunk 166
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 of the reporting unit exceeded its estimated fair value, indicating that the goodwill of the reporting unit was impaired. Therefore,
the Company recorded an impairment loss of $4.05 million during the quarter ended June 30, 2025, related to its Industrial IoT reporting
unit.

The Company utilized an income approach to assess
the fair value of the reporting unit as of June 30, 2025. The income approach considered the discounted cash flow model, considering
projected future cash flows (including timing and profitability), discount rate reflecting the risk inherent in future cash flows, perpetual
growth rate, and projected future economic and market conditions. The inputs for the fair value calculations of the reporting unit included
a 3% terminal growth rate and a discount rate of 29%. Management’s estimates of projected cash flows related to the reporting unit
include, but are not limited to, future earnings of the reporting unit using revenue growth rates, gross margins, and other cost assumptions
consistent with the reporting unit’s historical trends, and working capital requirements and future capital expenditures necessary
to fund future operations. The assumptions in the fair value measurement reflects the current market environment, industry-specific factors
and company-specific factors.

Intangible Assets

Intangible assets as of September 30, 2025 and
December 31, 2024 consisted of the following (in thousands):

     September 30, 2025      Gross Amount   Accumulated Amortization   Impairment   Net Carrying Amount   Remaining Weighted Average Useful Life   Patents  $468   $(207)  $—   $261    9.1   Trade Name/Trademarks   486    (191)   (115)   180    4.4   Proprietary Technology   1,395    (469)   (293)   633    5.2   Customer Relationships   137    (42)   —    95    3.5   In-Process R&D   243    (20)   (223)   —    —   Totals  $2,729    (929)  $(631)  $1,169    5.8  

    December 31, 2024 

    Gross Amount  
    Accumulated Am