Company: VHC
Filing Date: 2025-03-17
Form Type: 10-K
Source: 0001140361-25-009024
Chunk: 41

Company: VirnetX Holding Corp
Filing Date: 2025-03-17
Form: 10-K
Item: Item 3
Chunk 41
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 lowest priority to unobservable inputs (Level 3 measurement). Level 2 measurements
              utilize either directly or indirectly observable inputs in markets other than quoted prices in active markets.

Our financial instruments are stated at amounts that equal, or approximate, fair value. When we estimate fair value, we utilize market data or assumptions that we believe market
              participants would use in pricing the financial instrument, including assumptions about risk and inputs to the valuation technique. We use valuation techniques, primarily the income and market approach, which maximizes the use of observable
              inputs and minimize the use of unobservable inputs for recurring fair value measurements.

              25

Stock-based Compensation

We account for stock-based compensation using the fair value recognition method in accordance with U.S. GAAP. We recognize these compensation costs on a straight-line basis over the
              requisite service period of the award, which is generally a vesting term of 4 years. We recognize forfeitures, if any, when they occur. In addition, we record stock-based compensation expense for awards granted to non-employees at fair value
              of the consideration received or the fair value of the equity instruments issued, as they vest, over the performance period. See Note 6 in the notes to our consolidated financial statements for more information.

Results of Operations 

Revenue

                     2024

                    2023

                    Revenue

                    $

                    5

                    $

                    7

Revenue generated in 2024 was $5, compared to $7 in 2023.

Research and Development Expenses

                     2024

                    2023

                    Research and Development

                    $

                    6,038

                    $

                    9,713

Research and development costs include expenses paid to outside development consultants and compensation-related expenses for our engineering staff. Research and development costs are
              expensed as incurred. Our research and development expenses in 2024 were $6,038 compared to $9,713 in 2023. The decrease in 2024 was primarily due to a reduction in engineering compensation costs.

Selling, General and Administrative Expenses

                     2024

                    2023

                    Selling, General and Administrative

                    $

                    14,364

                    $

                    21,739

Selling, general and administrative expenses include compensation costs for management and administrative personnel, as well as expenses for outside legal, accounting, and consulting
              services. Our selling, general and administrative expenses in 2024 were $14,364 compared to $21