Company: XTIA
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076767
Chunk: 187

Company: XTI Aerospace, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 187
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,

●Structural
                                            design refinements based on updated loads and material analysis,

●Aerodynamic performance enhancements to the wing and tail surfaces,

●Stability and control improvements aligned with certification objectives,
and

●Updates to weight and Center of Gravity (CG) assessments.

We
maintain active monthly engagement with the FAA, including ongoing support for Tech Fam sessions with agency subject matter experts.
These interactions support continued progress in development and help confirm that our approach remains consistent with applicable regulatory
requirements.

We remain focused on advancing the TriFan 600
toward certification and commercialization, with Q2 marking notable progress in both engineering development and regulatory engagement
activities.

39

Critical Accounting Policies and Estimates

Our condensed consolidated
financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). In connection
with the preparation of our consolidated financial statements, we are required to make assumptions and estimates about future events,
and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses and the related disclosures. We base our
assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant
at the time our consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates
and judgments to ensure that our consolidated financial statements are presented fairly and in accordance with GAAP. However, because
future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and
such differences could be material.

The significant accounting policies of the Company
are described in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” section
of the Company’s annual report on Form 10-K for the year ended December 31, 2024. There have been no significant changes
to the Company’s critical accounting policies and estimates except for the valuation of long-lived and intangible assets and goodwill
as noted below.

Valuation of Long-lived and Intangible Assets
and Goodwill.

We periodically review long-lived
assets and certain identifiable intangible assets for impairment in accordance with Accounting Standards Codification (“ASC”)
360, “Property, Plant, and Equipment.” Goodwill and intangible assets not subject to amortization are reviewed annually for
impairment in accordance with ASC 350, “Intangibles – Goodwill and Other,” or more often if there are indications of
possible impairment.

The analysis to determine
whether or not an asset is