Company: MVIS
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001641172-25-022632
Chunk: 40

Company: MICROVISION, INC.
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 1
Chunk 40
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 evaluation processes.

Cost
of Revenue

    % of  
       
    % of  

    (in thousands) 
    2025  
    revenue  
    2024  
    revenue  
    $
    change  
    %
    change 
  
    Three Months Ended June 30, 
    $716  
     461.9  
    $1,554  
     81.8  
    $(838) 
     (53.9)
  
    Six Months Ended June 30, 
     1,266  
     170.2  
     2,831  
     99.1  
     (1,565) 
     (55.3)

Cost
of revenue includes both 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 and our research and development department. 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 decrease in cost of revenue for the three and six months ended June 30, 2025 compared
to the same periods in 2024 was primarily due to decreased revenue and the revenue mix.

Research
and Development Expense

    (in thousands) 
    2025  
    2024  
    $
    change  
    %
    change 
  
    Three Months Ended June 30, 
    $7,658  
    $14,204  
    $(6,546) 
     (46.1)
  
    Six Months Ended June 30, 
     15,061  
     31,515  
     (16,454) 
     (52.2)

Research
and development expense consists of compensation related costs of employees and contractors engaged in internal research and product
development activities, direct material to support development programs, laboratory operations, outsourced development and processing
work, and other operating expenses.