Company: MVIS
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0001641172-25-000783
Chunk: 249

Company: MICROVISION, INC.
Filing Date: 2025-03-26
Form: 10-K
Item: Item 2
Chunk 249
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 change  
    %
    change 
  
    (In thousands) 

    Revenue 
    $4,696  
    $7,259  
     (2,563) 
     (35.3)

Revenues
are recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration
that we expect to receive in exchange for those goods or services. We recognize revenue either at a point in time, or over time, depending
upon the characteristics of the individual contract. If control of the deliverable(s) transfers over time, the revenue is recognized
in proportion to the transfer of control. If control passes to the customer only upon completion and transfer of the asset, revenue is
recognized at the completion of the contract.

The
decrease in revenue for the year ended December 31, 2024 compared to the same period in 2023 was primarily due to revenue associated
with the Microsoft contract partially offset by the sale of sensors to an existing industrial customer for agricultural equipment and
service parts, an increase in shipments of MOVIA L sensors to Daimler Truck North America and affiliates as part of their RFQ evaluation
process, and increased sales to a second industrial customer.

25

Cost
of revenue

    2024  
    %
    of revenue  
    2023  
    %
    of revenue  
    $
    change  
    %
    change 
  
    (In thousands) 

    Cost of revenue 
    $7,530  
     160.3  
    $2,772  
     38.2  
    $4,758  
     171.6 

Cost
of revenue includes the direct and allocated indirect costs of products and services sold to customers. Direct costs include labor, materials,
reserves for estimated warranty expenses, and other costs incurred directly, or charged to us by our contract manufacturers, in the manufacture
of these products. Indirect costs include labor, overhead, and other costs associated with operating our manufacturing capabilities.
Overhead includes the costs of procuring, inspecting and storing material, facility and other costs, and is allocated to cost of revenue
based on the proportion of indirect labor which supported revenue activities.

Cost
of revenue can fluctuate significantly from period to period, depending on the product mix and volume, the level of overhead expense
and the volume of direct material purchased. The increase in cost of revenue for