Company: AIP
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001667011-25-000029
Chunk: 19

Company: Arteris, Inc.
Filing Date: 2025-08-05
Form: 10-Q
Item: Part I, Item 1
Chunk 19
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 or paid any cash dividend and does not currently plan to pay a cash dividend in the foreseeable future.The following table summarizes the ESPP valuation assumptions:Six Months Ended June 30,20252024Expected volatility72.0%74.4%Expected term (in years)0.50.5Risk-free interest rate4.3%5.4%Expected dividend yield0%0%Stock-based CompensationStock-based compensation expense is recorded on a departmental basis, based on the classification of the award holder. The following table presents the amount of stock-based compensation related to stock-based awards to employees on the Company’s unaudited condensed consolidated statements of operations (in thousands):Three Months EndedJune 30,Six Months EndedJune 30,2025202420252024Cost of revenue$232 $186 $437 $375 Research and development1,926 1,788 3,898 3,396 Sales and marketing1,048 657 2,017 1,380 General and administrative1,291 1,129 2,457 2,266 Total stock-based compensation$4,497 $3,760 $8,809 $7,417 

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12.    EQUITY METHOD INVESTMENT

On February 21, 2022, Arteris IP (Hong Kong) Ltd. (AHK), a wholly-owned subsidiary of the Company, entered into a Share Purchase and Shareholders Agreement with certain investors and Ningbo Transchip Information Consulting Partnership (Limited Partnership) (Management Co), pursuant to which, the Company, certain investors and Management Co subscribed to the registered capital of Transchip Technology (Nanjing) Co., Ltd. (Transchip). The Company’s ownership interest in Transchip’s registered capital was 35.0% on a fully diluted basis as of June 30, 2025. The Company’s loss from its proportionate share of its equity method investment in Transchip was $0.8 million and $0.7 million for the three months ended June 30, 2025 and 2024, respectively, and $1.6 million and $1.5 million for the six months ended June 30, 2025 and 2024, respectively. The Company reviews its investment in Transchip for impairment if and when circumstances indicate that a decline in fair value below its carrying amount may have occurred. Since Transchip’s formation, it has incurred losses financed primarily through investor