Press release·08/15/2026 07:41:58

Overview

We are a leading provider of augmented and virtual reality educational technology products, focusing primarily on United States K-12 schools, the Career and Technical Education sector, and select international markets. Our proprietary hardware and software platform delivers interactive, stereoscopic three-dimensional (3D) learning experiences without the need for VR goggles or specialty glasses. We generate revenue through the sale of our hardware, software licenses, and implementation and professional development services.

Our Business Model

We generate revenue by selling our hardware products, software, and professional development services to our customers.

Hardware Product Revenue

Our laptops are designed to work with a wide range of learning applications, for both K-12 education and CTE, that come to life by having 3D models projected out of the screen. Our flagship product is the Inspire, our latest laptop product built in partnership with a major PC OEM. Hardware Product revenue accounted for 53% and 57% of our total revenue for the six months ended June 30, 2026 and 2025, respectively.

Software Applications Revenue

We derive software applications revenue from the sale of licenses and subscription plans to the software applications available on our platform. Our software applications are priced based on the number of devices or users and length of the contract. Software applications revenue accounted for 39% and 31% of our total revenue for the six months ended June 30, 2026 and 2025, respectively. We expect that going forward our software applications revenue will grow faster in absolute dollars and as a percentage of our total revenue than our product or service revenues.

Services Revenue

We derive services revenue from installation and/or training services for products, both of which are separate performance obligations and typically are satisfied within a short period of time. We also offer one- and two-year extended warranty contracts that customers can purchase at their option. Services revenue accounted for 8% and 12% of our total revenue for the six months ended June 30, 2026 and 2025, respectively.

Key Metrics

We monitor several key metrics to help us evaluate our business, including:

Bookings Growth

We track bookings growth, which represent customer orders that have hardware, software, and service components. Bookings indicate future revenue, which lags based on product shipping date, monthly recognition of certain subscription revenue, and service delivery completion.

United States CTE & K-12 Bookings

We track bookings from customers in our United States CTE and K-12 market segments, as we believe our ability to retain and grow our product and software revenue will be dependent on our performance in these areas.

International Bookings

We track bookings from our international reseller partners relative to total bookings as an indicator of our international sales performance.

Software Subscription Renewable Revenue Growth

We monitor the level of renewing revenue from our software licenses and subscriptions, as an indicator of future business success, customer adoption, and potential for margin improvement.

Retention and Expansion of Customers

We track the annualized contract value (ACV) of active software licenses, with particular attention to customers with at least $50,000 in ACV, and our net dollar revenue retention rate (NDRR) on these customers as indicators of our ability to retain and grow our customer base.

Average Term Length

We measure the dollar-weighted term length of our renewable software license agreements as a signal of long-term customer adoption.

Non-GAAP Financial Measures

We use non-GAAP financial measures, such as Adjusted EBITDA, to provide additional insight into our operating performance.

Components of Results of Operations

Our revenue consists of hardware, software, and services. Our cost of goods sold includes the costs associated with hardware, software, and services. Our operating expenses include research and development, selling and marketing, and general and administrative expenses.

Results of Operations

For the three and six months ended June 30, 2026 and 2025, we experienced decreases in total revenue, primarily due to lower hardware, software, and services revenue. This was driven by uncertainty in our K-12 end-user markets, causing longer sales cycles and customer delays. Our operating expenses also decreased during these periods, primarily due to lower personnel, marketing, and consulting costs.

We incurred net losses of $6.3 million and $11.9 million for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, we had an accumulated deficit of $322.1 million and $0.5 million in cash and cash equivalents.

Liquidity and Capital Resources

We have historically funded our operations through the issuance of common and preferred stock, our IPO, and debt financing. As of June 30, 2026, we had $0.5 million in cash and cash equivalents. We have incurred operating losses and negative cash flows from operations since inception, and there is substantial doubt about our ability to continue as a going concern.

We have entered into various debt and financing arrangements, including a Senior Secured Convertible Note Financing, to provide additional liquidity. However, our ability to raise additional funds for working capital through equity or debt financings or other sources may depend on the financial success of our business and the implementation of our key strategic initiatives.

Critical Accounting Estimates

Our critical accounting estimates relate to revenue recognition, inventory valuation, convertible debt accounting, preferred stock valuation, and income taxes, among others. These estimates require significant judgment and could have a material impact on our financial statements.