Company: MVIS
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001493152-25-021931
Chunk: 168

Company: MICROVISION, INC.
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 1
Chunk 168
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 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 nine months ended September 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 September 30, 
    $7,978  
    $8,736  
    $(758) 
     (8.7)
  
    Nine Months Ended September 30, 
     23,039  
     40,251  
     (17,212) 
     (42.8)

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. We assign our research and development resources based on the business opportunity of the available
projects, the skill mix of the resources available and the contractual commitments we have made to our customers. We believe that a substantial
level of continuing research and development expense will be required to further develop our scanning technology.

The
decrease in research and development expense during the three months ended September 30, 2025 compared to the same period in 2024 was
primarily due to a reduced workforce resulting in lower salary and benefits expense of $0.5 million and lower IT and software costs of $0.3 million, partially offset
by higher building costs of $0.4 million and higher travel costs of $0.3 million.

The
decrease in research and development expense during the nine months ended September 30, 2025 compared to the same period in 2024 was
primarily due to a reduced workforce resulting in lower salary and benefits expense of $8.5 million, lower restructuring charges of $5.1 million, lower purchased services
of $1.7 million, lower IT and software costs of $0.8 million, and lower direct materials and equipment costs of $