Company: MVIS
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0001641172-25-000783
Chunk: 545

Company: MICROVISION, INC.
Filing Date: 2025-03-26
Form: 10-K
Item: Item 8
Chunk 545
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 minimize the
use of unobservable inputs. The Company uses market data, assumptions and risks that market participants would use in measuring the fair
value of the asset or liability, including the risks inherent in the inputs and the valuation techniques.

Financial
instruments include cash and cash equivalents, investment securities, accounts receivable, accounts payable and accrued liabilities.
The carrying value of financial instruments approximate fair value due to their short maturities. Cash equivalents are comprised of short-term
highly rated (A rated securities and above) money market savings accounts.

Short-term
investment securities primarily consist of debt securities. The Company has classified its entire investment portfolio as available-for-sale.
Available-for-sale securities are stated at fair value with unrealized gains and losses included in other comprehensive income (loss).
Dividend and interest income are recognized when earned. Realized gains and losses, if any, are presented separately on the income statement.

Restricted
Cash

Restricted
cash is held in money market savings accounts and serves as collateral for irrevocable letters of credit related to our facility
lease agreements. The restricted cash balance as of December 31, 2024 includes $0.5
million and $0.2
million of collateral under two letters of credit, issued in connection with lease agreements for the Company’s headquarters
and general office and lab space, respectively, in Redmond, Washington. The restricted cash balance also includes approximately
$1.0
million for a security deposit associated with a lease agreement for office space in Hamburg,
Germany.

Inventory

Inventory
consists of raw materials, work in process and finished goods assemblies. Inventory is computed using the first-in, first-out (FIFO)
method and is stated at the lower of cost and net realizable value. Management periodically assesses the need to account for obsolescence
of inventory and adjusts the carrying value of inventory to its net realizable value when required.

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Intangible
Assets

Intangible
assets consist of acquired technology from the January 2023 Ibeo asset purchase and purchased patents. As part of the Ibeo asset acquisition,
two intangible assets were primarily acquired in the form of Perception software and Reference software, with initial useful lives of
15 years and 8 years, respectively. The estimated fair value of acquired technology was calculated through the income approach using
the multi-period excess earnings and relief from royalty methodologies. The intangible assets are amortized using the straight-line method
over their estimated period of benefit, ranging from one