Company: XTIA
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076767
Chunk: 23

Company: XTI Aerospace, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 23
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 2024 
  
    Revenues 
    $1,031  
    $1,758 
  
    Net loss attributable to common stockholders 
    $(15,420) 
    $(31,669)
  
    Net loss per basic and diluted common share 
    $(261.97) 
    $(538.07)
  
    Weighted average common shares outstanding: 

    Basic and Diluted 
     58,857  
     58,857 

Note 6 - Goodwill and Intangible Assets 

Goodwill

In connection with the XTI Merger, the excess
of the purchase price over the estimated fair value of the net assets assumed of $12.4 million was recognized as goodwill.

The following table summarizes the changes in the carrying amount
of Goodwill for the three months ended June 30, 2025 (in thousands):

    Amount 
  
    Beginning balance - January 1, 2025 
    $12,072 
  
    Foreign currency translation adjustment 
     1,120 
  
    Impairment 
     (4,049)
  
    Ending balance – June 30, 2025 
    $9,143 

The Company tests goodwill for impairment at the reporting unit level
annually, on October 1, or more frequently if a change in circumstances or the occurrence of events indicates that potential impairment
exists. In accordance with ASC 350, the Company first assessed whether there were any indicators of goodwill impairment that would require
a quantitative analysis to be performed (i.e., a triggering event). The Company determined there was a triggering event during the
six months ended June 30, 2025 related to the IoT reporting unit, in the form of a current period operating and cash flow loss, a consistent
history of operating losses, and the revenue results for the current period missing forecasted targets due to (i) the sales cycle to close
transactions taking longer than anticipated and (ii) supply chain issues causing delays in our delivery of Nanotron product to customers.

In accordance with ASC 350, given a triggering
event was identified, the Company performed a quantitative goodwill impairment analysis related to its Industrial IoT reporting unit,
which concluded the carrying amount 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 three and six months ended June 30,
2025, related to