Quarterly report [Sections 13 or 15(d)]

Goodwill and Business Acquisition

v3.25.3
Goodwill and Business Acquisition
 9 Months Ended
Sep. 30, 2025
Goodwill and Business Acquisition [Abstract]  
GOODWILL AND BUSINESS ACQUISITION

NOTE 6 – GOODWILL AND BUSINESS ACQUISITION

 

We account for acquisitions in accordance with FASB ASC 805, “Business Combinations” (“ASC 805”), and goodwill in accordance with ASC 350, “Intangibles — Goodwill and Other” (“ASC 350”). The excess of the purchase price over the estimated fair value of net assets acquired in a business combination is recorded as goodwill.

 

Apeiro Transaction

 

On August 31, 2025, the Company completed the acquisition of Apeiro, pursuant to the Share Purchase Agreement (the “Apeiro Acquisition Agreement”), by and among the Company, Apeiro, and the Apeiro shareholders. Pursuant to the Apeiro Acquisition Agreement, the Company acquired 100% of the issued and outstanding share capital of Apeiro.

 

The following table summarizes the consideration paid for Apeiro and the preliminary allocation of the purchase consideration to the estimated fair value of the assets acquired and liabilities assumed at the acquisition date.

 

Purchase price consideration:      
Cash   $ 12,024,896  
         
Estimated fair value of assets acquired:        
Cash and cash equivalents and restricted cash   $ 5,535,975  
Certificates of deposit     907,229  
Other current assets     644,854  
Property and equipment     78,494  
Intangible assets     3,982,000  
Total estimated fair value of assets acquired     11,148,552  
         
Estimated fair value of liabilities assumed:        
Accounts payable     1,534,122  
Customer Prepayments     3,108,382  
Other payables     624,326  
Deferred tax liability     878,839  
Total estimated fair value of liabilities assumed     6,145,669  
         
Net Assets Acquired   $ 5,002,883  
         
Goodwill   $ 7,022,013  

The intangible assets acquired include the developed technology (see Note 7 – Intangible Assets). The final purchase price allocation will be determined when the Company has completed the detailed valuations and necessary calculations. The final allocation could differ materially from the preliminary allocation. The final allocation may include (1) changes in fair values of property, plant and equipment, (2) changes in valuation of intangible assets such as developed technology, as well as goodwill and (3) other changes to assets and liabilities.

 

Goodwill represents the assembled workforce, acquired capabilities, and future economic benefits resulting from the acquisition. No portion of the goodwill is deductible for tax purposes.

 

Our results for the nine months ended September 30, 2025 include results from Apeiro between September 1, 2025 and September 30, 2025. The following unaudited pro forma information presents the Company’s results of operations as if the acquisition of Apeiro had occurred on January 1, 2024. The pro forma results do not purport to represent what the Company’s results of operations actually would have been if the transactions had occurred on January 1, 2024 or what the Company’s operating results will be in future periods.

 

    (Unaudited)  
    Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
    2025     2024     2025     2024  
Revenue, net   $ 11,495,560     $ 2,449,292     $ 26,208,880     $ 5,969,152  
Net loss attributable to common stockholders   $ (8,803,649 )   $ (10,678,382 )   $ (36,229,446 )   $ (30,918,420 )
Net loss per share – basic and diluted   $ (0.03 )   $ (0.15 )   $ (0.21 )   $ (0.46 )

 

Goodwill

 

The Company has recognized goodwill primarily as part of the American Robotics acquisition in 2021, the Airobotics acquisition in 2023, and the Apeiro acquisition in August 2025. In December 2024, the Company bypassed the qualitative analysis and proceeded directly to a quantitative analysis. The Company engaged a third-party service provider to carry out a valuation of the OAS reporting unit. Using a discounted cash flow model and market approach model with updated forecasts for revenue and cash flows, it was determined that the fair value of the OAS reporting unit was higher than the carrying value as of December 31, 2024 and no impairment was necessary.

 

The changes in the carrying amount of goodwill for the nine months ended September 30, 2025 are as follows:

 

    OAS  
Balance as of January 1, 2024 and 2025   $ 27,751,921  
Goodwill acquired     7,022,013  
Balance as of September 30, 2025   $ 34,773,934