Company: SONM
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001493152-25-020310
Chunk: 11

Company: SONIM TECHNOLOGIES INC
Filing Date: 2025-10-31
Form: 10-Q
Item: Item 8
Chunk 11
---

  
    Connected Solutions 
     4,000  
     49  
     6,937  
     330 
  
    White Label Products (ODM Model) (Related Party) 
     —  
     —  
     —  
     7,658 
  
    Accessories and Other 
     305  
     236  
     765  
     577 
  
    Total net revenues 
    $16,214  
    $15,022  
    $44,125  
    $43,314 

Shipping
and handling costs

The
Company has elected to account for shipping and handling activities related to contracts with customers as costs to fulfill the promise
to transfer the associated products.

    9

Contract
costs

Applying
the practical expedient, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred when the amortization
period of the assets that otherwise would have been recognized is one year or less. These costs are included in sales and marketing expenses.

The
non-recurring costs associated with design and development of new products for technical approval represent costs to fulfill a contract
pursuant to ASC 340-40, Other Assets and Deferred Costs. Accordingly, the Company capitalizes these contract fulfillment costs
and amortizes such costs over the estimated period of time they are expected to be recovered, which is typically three to four years,
the estimated life of a particular product model. As of September 30, 2025, and December 31, 2024, the net contract fulfillment assets
were $9,053 and $6,399, respectively.

If
the Company determines that such contract fulfillment costs are not expected to be recovered, it records an impairment in the period
such determination is made. During the nine months ended September 30, 2024, the Company recorded an impairment of contract fulfillment
assets of $3,217 due to a decrease in projected profit of one of its hotspots and the cancellation of a consumer durable product. During
the nine months ended September 30, 2025, the Company recorded an impairment of contract fulfillment assets of $1,084 due to the end
of life of a legacy smartphone, which is included in cost of revenues in the Condensed Consolidated Statements of Operations. 

NOTE
3 — Significant Balance Sheet Components

The
following table presents the components of the Company’s accounts receivable, net:

Schedule