0000950170-24-094090 | 10-Q | XBRL Viewer

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Basis of Presentation (Additional Information) (Details) - Lind Partners, LLC $ in Millions	6 Months Ended
	Jun. 29, 2024 USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Proceeds from Notes Payable	$ 3.4
Subsequent Note
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Proceeds from Notes Payable	$ 1.5

Stock-Based Compensation

6 Months Ended

Jun. 29, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

9. Stock-Based Compensation

The Company accounts for stock-based compensation granted to employees and directors, including stock option awards, restricted stock and restricted stock units (“RSUs”) in accordance with FASB ASC Topic 718, “Compensation – Stock Compensation” (“ASC 718”). Accordingly, stock-based compensation cost is measured at grant date, based on the fair value of the award, and is recognized as an expense over the employee’s service period. The Company recognizes compensation expense on a ratable basis over the requisite service period of the award.

The Company values options using the Black-Scholes option pricing model. Time-based RSUs are valued at the grant date fair value of the underlying common shares. Performance-based RSUs without market conditions are valued at grant date fair value of the underlying common shares. Performance-based RSUs granted with market conditions and performance-based stock options with market conditions are valued using the Monte Carlo simulation model. The Black-Scholes option pricing model requires the use of highly subjective and complex assumptions which determine the fair value of stock-based awards, including the option’s expected term and the price volatility of the underlying stock. The Monte Carlo simulation model incorporates assumptions for the holding period, risk-free interest rate, stock price volatility and dividend yield.

2008 Equity Incentive Plan, as amended.

The terms of awards granted during the six months ended June 29, 2024 were consistent with those described in the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 30, 2023.

The following table shows stock-based compensation expense included in the condensed consolidated statements of operations for the three and six months ended June 29, 2024 and July 1, 2023 (in thousands):


	Three Months Ended				Six Months Ended
	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023
Cost of revenues	$	73	$	34	$	133	$	95
Research and development		52		52		104		104
Sales and marketing		110		85		221		206
General and administrative		184		229		355		468
Total stock-based compensation expense	$	419	$	400	$	813	$	873

Stock-based compensation expense capitalized to inventory was immaterial for the six months ended June 29, 2024 and July 1, 2023.

As of June 29, 2024, there was $1.4 million of total unrecognized compensation cost, net of expected forfeitures, related to non-vested stock-based compensation arrangements. The cost is expected to be recognized over a weighted average period of 1.76 years.

Summary of Stock Options

The following table summarizes stock options information during the six months ended June 29, 2024:


	Number of Shares			Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value (thousands)
Outstanding as of December 30, 2023		2,757,921		$	3.60
Granted		20,300		$	2.94
Exercised		(135	)	$	2.32
Canceled or forfeited		(490,666	)	$	4.68
Outstanding as of June 29, 2024		2,287,420		$	3.37	$	36

The weighted average grant date fair value of the options granted was $1.82 and $1.35 per share for the six months ended June 29, 2024 and July 1, 2023, respectively.

The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock-based awards (options) with the following weighted-average assumptions:


	Three Months Ended						Six Months Ended
	June 29, 2024			July 1, 2023			June 29, 2024			July 1, 2023
Average risk free interest rate		4.35	%		3.83	%		4.35	%		3.83	%
Expected life (in years)		4.40			4.40			4.40			4.40
Dividend yield	—			—			—			—
Average volatility		77	%		76	%		77	%		76	%

Option-pricing models require the input of various subjective assumptions, including the option’s expected life and the price volatility of the underlying stock. The expected stock price volatility is based on an analysis of the Company’s stock price history over a period commensurate with the expected term of the options, trading volume of the Company’s stock, look-back volatilities and Company-specific events that affected volatility in a prior period. The expected term of employee stock options represents the weighted average period the stock options are expected to remain outstanding and is based on the history of exercises and cancellations on all past option grants made by the Company, the contractual term, the vesting period and the expected remaining term of the outstanding options. The risk-free interest rate is based on the U.S. Treasury interest rates whose term is consistent with the expected life of the stock options. No dividend yield is included as the Company has not issued any dividends and does not anticipate issuing any dividends in the future.

Information regarding stock options outstanding, vested, expected to vest, and exercisable as of June 29, 2024 is summarized below:


	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value (thousands)
Options outstanding		2,287,420	$	3.37		4.29	$	36
Options vested and expected to vest		2,230,362	$	3.40		4.24	$	34
Options exercisable		1,258,699	$	4.03		3.03	$	12

The aggregate intrinsic value in the table above represents the pre-tax intrinsic value, based on the Company’s closing price as of June 29, 2024, that would have been received by option holders had all option holders exercised their stock options as of that date. This amount changes based on the fair market value of the Company’s common stock. The total intrinsic value of options exercised for the six months ended June 29, 2024 and July 1, 2023 was immaterial and approximately $4 thousand, respectively.

Summary of RSUs

Information regarding RSUs activity for the six months ended June 29, 2024 is summarized below:


	Number of Shares
Outstanding as of December 30, 2023		353,212
RSUs granted		120,000
RSUs released		(196,335	)
RSUs forfeited		(16,669	)
Outstanding as of June 29, 2024		260,208

Stock-Based Compensation - Stock-Based Compensation Expenses (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 419	$ 400	$ 813	$ 873
Cost of Revenues
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	73	34	133	95
Research and Development
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	52	52	104	104
Sales and Marketing
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	110	85	221	206
General and Administrative
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 184	$ 229	$ 355	$ 468

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (2,679)	$ (2,766)	$ (6,143)	$ (4,856)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Business Segments (Tables)

6 Months Ended

Jun. 29, 2024

Segment Reporting [Abstract]

Schedule of Revenue Information by Product

Revenue information shown by product group is as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023
Cyclo G6	$	3,336	$	3,658	$	6,289	$	7,327
Retina		7,295		6,857		14,069		14,071
Other(1)		2,000		2,340		4,034		5,163
Total revenues	$	12,631	$	12,855	$	24,392	$	26,561

(1) Includes service contract revenues of $0.1 million and $0.3 million, and $0.4 million and $0.8 million recognized during the three and six months ended June 29, 2024 and July 1, 2023, respectively. Includes $0.4 million and $0.7 million recognized revenue related to the exclusive distribution rights during both of the three and six months ended June 29, 2024 and July 1, 2023, respectively. Other also includes revenues from paid service, royalty, freight and legacy G probes.

Revenue Information by Geographic Region

Revenue information shown by geographic region, based on the sales destination, is as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023
United States	$	5,598	$	6,742	$	10,919	$	13,516
Europe, Middle East and Africa		2,667		2,843		6,365		7,020
Asia/Pacific Rim		3,597		2,482		6,042		4,625
Americas, excluding the U.S.		769		788		1,066		1,400
	$	12,631	$	12,855	$	24,392	$	26,561

Stock-Based Compensation - Weighted Average Assumptions for Fair Value Estimate of Stock-Based Awards (Options) (Details)	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Weighted average assumptions for fair value estimate of stock-based awards (options)
Average risk free interest rate	4.35%	3.83%	4.35%	3.83%
Expected life (in years)	4 years 4 months 24 days	4 years 4 months 24 days	4 years 4 months 24 days	4 years 4 months 24 days
Dividend yield	0.00%	0.00%	0.00%	0.00%
Average volatility	77.00%	76.00%	77.00%	76.00%

Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 29, 2024

Accounting Policies [Abstract]

Reconciliation of Changes in Deferred Revenue

A reconciliation of the changes in the Company’s deferred revenue balance for the six months ended June 29, 2024 and July 1, 2023, is as follows:


	Six Months Ended
	June 29, 2024			July 1, 2023
Balance, beginning of period	$	12,429		$	14,153
Additions to deferral		678			607
Revenue recognized		(1,556	)		(1,569	)
Balance, end of the period		11,551			13,191
Non-current portion of deferred revenue		9,261			10,881
Current portion of deferred revenue	$	2,290		$	2,310

Accounts Receivable and Provision for Credit Losses (Tables)

6 Months Ended

Jun. 29, 2024

Allowance for Credit Loss [Abstract]

Summary of Activity in Provision for Credit Losses for Accounts Receivable

The following table presents the activity in the provision for credit losses for accounts receivable by pool type for the six months ended June 29, 2024 (in thousands):


	Domestic			International			Total
Balance, beginning of period	$	(94	)	$	(52	)	$	(146	)
Change to provision		16			18			34
Balance, end of period	$	(78	)	$	(34	)	$	(112	)

Related Party - Topcon - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023	Dec. 30, 2023
Related Party Transaction [Line Items]
Total revenues	$ 12,631	$ 12,855	$ 24,392	$ 26,561
Receivable from related party	6,269		6,269		$ 6,727
Payable to related party	$ 7,767		$ 7,767		4,499
Topcon [Member]
Related Party Transaction [Line Items]
Ownership percentage	9.90%		9.90%
Topcon America Corporation [Member]
Related Party Transaction [Line Items]
Total revenues	$ 4,100	3,700	$ 7,400	8,000
Purchases from related party	100		200
Topcon America Corporation [Member] \| Related Party [Member]
Related Party Transaction [Line Items]
Receivable from related party	1,800		1,800		2,900
Payable to related party	500		500		$ 200
Distribution Rights [Member]
Related Party Transaction [Line Items]
Revenue Recognized	400	300	700	700
Distribution Rights [Member] \| Topcon America Corporation [Member]
Related Party Transaction [Line Items]
Revenue Recognized	$ 400	$ 300	$ 700	$ 700

Fair Value Measurements - Financial Assets Measured and Recognized at Fair Value on a Recurring Basis (Details) - Fair Value Measurements Recurring - Money Market Funds - USD ($) $ in Thousands	Jun. 29, 2024	Dec. 30, 2023
Assets:
Assets, Fair Value Measurements	$ 1,238	$ 43
Level 1
Assets:
Assets, Fair Value Measurements	1,238	43
Level 2
Assets:
Assets, Fair Value Measurements	0	0
Level 3
Assets:
Assets, Fair Value Measurements	$ 0	$ 0

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023
Operating activities:
Net loss	$ (6,143)	$ (4,856)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	312	374
Amortization of operating lease right-of-use assets	460	527
Stock-based compensation	813	873
Changes in operating assets and liabilities:
Accounts receivable	458	62
Receivable from related party	1,154	1,157
Inventories	(1,218)	(513)
Prepaid expenses and other current assets	(874)	252
Other long-term assets	(25)	(288)
Accounts payable	3,268	286
Payable to related party	391	119
Accrued compensation	520	(286)
Accrued expenses	(1,128)	(154)
Deferred revenue	(878)	(962)
Operating lease liabilities	(457)	(510)
Other liabilities	373	(65)
Net cash used in operating activities	(2,974)	(3,984)
Investing activities:
Acquisition of property and equipment	(3)	(59)
Net cash used in investing activities	(3)	(59)
Financing activities:
Proceeds for stock option exercises	0	37
Taxes paid related to net share settlements of equity awards	0	(63)
Net cash used in financing activities	0	(26)
Effect of foreign exchange rate changes	54	(32)
Net decrease in cash and cash equivalents	(2,923)	(4,101)
Cash and cash equivalents, beginning of period	7,034	13,922
Cash and cash equivalents, end of period	4,111	9,821
Supplemental disclosure of cash flow information:
Cash paid during the period for income taxes	20	53
Supplemental disclosure of non-cash activities:
Transfer of inventory to property and equipment	$ 0	$ 3

Stock-Based Compensation (Tables)

6 Months Ended

Jun. 29, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation Expenses


	Three Months Ended				Six Months Ended
	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023
Cost of revenues	$	73	$	34	$	133	$	95
Research and development		52		52		104		104
Sales and marketing		110		85		221		206
General and administrative		184		229		355		468
Total stock-based compensation expense	$	419	$	400	$	813	$	873

Summary of Stock Options

The following table summarizes stock options information during the six months ended June 29, 2024:


	Number of Shares			Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value (thousands)
Outstanding as of December 30, 2023		2,757,921		$	3.60
Granted		20,300		$	2.94
Exercised		(135	)	$	2.32
Canceled or forfeited		(490,666	)	$	4.68
Outstanding as of June 29, 2024		2,287,420		$	3.37	$	36

Weighted Average Assumptions for Fair Value Estimate of Stock-Based Awards (Options)

The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock-based awards (options) with the following weighted-average assumptions:


	Three Months Ended						Six Months Ended
	June 29, 2024			July 1, 2023			June 29, 2024			July 1, 2023
Average risk free interest rate		4.35	%		3.83	%		4.35	%		3.83	%
Expected life (in years)		4.40			4.40			4.40			4.40
Dividend yield	—			—			—			—
Average volatility		77	%		76	%		77	%		76	%

Summary of Stock Options Outstanding, Vested, Expected to Vest and Exercisable

Information regarding stock options outstanding, vested, expected to vest, and exercisable as of June 29, 2024 is summarized below:


	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value (thousands)
Options outstanding		2,287,420	$	3.37		4.29	$	36
Options vested and expected to vest		2,230,362	$	3.40		4.24	$	34
Options exercisable		1,258,699	$	4.03		3.03	$	12

Restricted Stock Units

Information regarding RSUs activity for the six months ended June 29, 2024 is summarized below:


	Number of Shares
Outstanding as of December 30, 2023		353,212
RSUs granted		120,000
RSUs released		(196,335	)
RSUs forfeited		(16,669	)
Outstanding as of June 29, 2024		260,208

Stock-Based Compensation - Additional Information (Details) - USD ($)	6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total unrecognized compensation cost related to non-vested share-based compensation arrangements	$ 1,400,000
Cost is expected to be recognized over a weighted average period	1 year 9 months 3 days
Weighted-average grant date fair value of the options granted	$ 1.82	$ 1.35
Total intrinsic value of options exercised	$ 4,000	$ 4,000
Dividends issued	$ 0

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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+ Details

Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Dec. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Carrying value of goodwill	$ 965		$ 965
Amortization expense	$ 167	$ 167

- Definition

Amount, after accumulated impairment loss, of asset representing future economic benefit arising from other asset acquired in business combination or from joint venture formation or both, that is not individually identified and separately recognized.

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+ Details

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 29, 2024	Aug. 05, 2024
Cover [Abstract]
Entity Registrant Name	IRIDEX CORP
Entity Central Index Key	0001006045
Document Type	10-Q
Document Period End Date	Jun. 29, 2024
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-28
Trading Symbol	IRIX
Entity Filer Category	Non-accelerated Filer
Entity Shell Company	false
Entity Current Reporting Status	Yes
Entity Small Business	true
Entity Emerging Growth Company	false
Entity File Number	0-27598
Entity Tax Identification Number	77-0210467
Entity Address, Address Line One	1212 Terra Bella Avenue
Entity Address, City or Town	Mountain View
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94043-1824
City Area Code	650
Local Phone Number	940-4700
Entity Common Stock, Shares Outstanding		16,509,412
Entity Interactive Data Current	Yes
Title of 12(b) Security	Common Stock, par value $0.01 per share
Security Exchange Name	NASDAQ
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Income Statement [Abstract]
Total revenues	$ 12,631	$ 12,855	$ 24,392	$ 26,561
Cost of revenues	7,496	7,492	14,799	15,260
Gross profit	5,135	5,363	9,593	11,301
Operating expenses:
Research and development	1,501	1,845	3,037	3,594
Sales and marketing	3,487	4,264	7,233	8,547
General and administrative	2,785	2,148	5,253	4,398
Total operating expenses	7,773	8,257	15,523	16,539
Loss from operations	(2,638)	(2,894)	(5,930)	(5,238)
Other income (expense), net	(22)	138	(156)	404
Loss from operations before provision for income taxes	(2,660)	(2,756)	(6,086)	(4,834)
Provision for income taxes	19	10	57	22
Net loss	$ (2,679)	$ (2,766)	$ (6,143)	$ (4,856)
Net loss per share:
Basic	$ (0.16)	$ (0.17)	$ (0.38)	$ (0.3)
Diluted	$ (0.16)	$ (0.17)	$ (0.38)	$ (0.3)
Weighted average shares used in computing net loss per common share:
Basic	16,287	16,036	16,270	16,018
Diluted	16,287	16,036	16,270	16,018

Basis of Presentation

6 Months Ended

Jun. 29, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of IRIDEX Corporation (“IRIDEX”, the “Company”, “we”, “our”, or “us”) have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the financial statements have been included.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto, together with management’s discussion and analysis of the Company’s financial condition and results of operations, contained in our Annual Report on Form 10-K for the fiscal year ended December 30, 2023, which was filed with the SEC on March 29, 2024. The results of operations for the three and six months ended June 29, 2024 and July 1, 2023 are not necessarily indicative of the results for the fiscal year ending December 28, 2024 or any future interim period. The three months ended June 29, 2024 and July 1, 2023 each had 13 weeks. For purposes of reporting the financial results, the Company’s fiscal years end on the Saturday closest to the end of December. Periodically, the Company includes a 53rd week to a year in order to end that year on the Saturday closest to the end of December.

Liquidity and Management Plans

The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern. For the six months ended June 29, 2024, the Company implemented cost savings initiatives to increase operational efficiencies across all departments, which the Company expects will decrease its operating expenses and increase working capital over the next five quarters. Based on these cost savings initiatives implemented by the Company and the closing of the $3.4 million Note with The Lind Partners, LLC (“Lind”) (with an option to have an additional $1.5 million Subsequent Note), management believes it has alleviated substantial doubt about the Company’s ability to satisfy its liquidity needs over the next 12 months.

Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 29, 2024

Accounting Policies [Abstract]

Financial Statement Presentation

The unaudited condensed consolidated financial statements include the accounts of the Company and our wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and the related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. In addition, any change in these estimates or their related assumptions could have an adverse effect on our operating results.

Revenue Recognition

Our revenues arise from the sale of laser consoles, delivery devices, consumables, service, and support activities. We also derive revenue from royalties from third parties which are typically based on the licensees’ net sales of products that utilize our technology. Our revenue is recognized in accordance with Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers.” The Company recognizes revenue using the five-step model: (1) identifying the contract with the customer, (2) identifying the performance obligations in the contract, (3) determining expected transaction price, (4) allocating the transaction price to the distinct performance obligations in the contract, and (5) recognizing revenue when (or as) the performance obligations are satisfied.

The Company has the following revenue transaction types: (1) Product Sale Only, (2) Service Contracts, (3) System Repairs (outside of warranty), (4) Royalty Revenue and (5) Exclusive Distribution Rights.

Product Sale Only: The Company’s products consist of laser consoles, delivery devices and consumable instrumentation, including laser probes. The Company’s products are currently sold for use by ophthalmologists specializing in the treatment of glaucoma and retinal diseases. Inside the United States and Germany the products are sold directly to the end

users. In other countries outside of the United States and Germany, the Company utilizes independent, third-party distributors to market and sell the Company’s products. There is no continuing obligation after shipment is made to these distributors.

The Company recognizes revenue from product sales at a point in time subject to the allocation of transaction price to additional performance obligations, if any.

Service Contracts: The Company offers a standard two-year warranty on all system sales. The Company also offers a service contract which is sold to customers in incremental, one-year periods that begin subsequent to the expiration of the standard two-year warranty. The customer can opt to purchase the service contract at the time of the system sale or after the initial system sale.

The Company recognizes revenue from service contracts ratably over the service period. Revenue recognition for the sale of a service contract is largely dependent on the timing of the sale as follows:

Service Contract Sale in Conjunction with System Sale: If the customer opts to purchase a service contract at the time of the system sale, the Company allocates the transaction price of the distinct performance obligations in the contract by determining stand-alone selling price using historical pricing net of any variable consideration or discounts to specifically allocate to a particular performance obligation.

Service Contract Sale Subsequent to System Sale: If the customer opts to purchase a service contract after the initial system sale, the Company determines the amount of time that has elapsed since the initial system sale. If the service contract is purchased within 60 days of the initial sale, the Company considers this sale to be an additional element of the original sale and allocates the transaction price of the distinct performance obligations in the contract by determining stand-alone selling price using historical pricing net of any variable consideration or discounts to specifically allocate to a particular performance obligation. If the service contract is purchased subsequent to 60 days after the initial sale, the sale of the service contract is deemed a separate contract and is deferred at the selling price and recognized ratably over the extended warranty period as the performance obligation is satisfied.

System Repairs (outside of warranty): Customers will occasionally request repairs from the Company subsequent to the expiration of the standard warranty and outside of a service contract.

The Company recognizes revenue from system repairs (outside of warranty) at a point in time. When the customer requests repairs from the Company subsequent to the expiration of the standard warranty and outside of a service contract, these repair contracts are considered separate from the initial sale. As such, revenue is recognized as the repair services are rendered and the performance obligation satisfied.

Royalty Revenue: The Company has royalty agreements with two customers related to the sale of the Company’s intellectual property. Under the terms of these agreements, one customer is to remit a percentage of sales to the Company as the sales occur and one customer is to remit fixed amount royalty payments based on the quantity sold as the sales occur.

The arrangements with three customers are for sales-based licenses of intellectual property, for which the guidance in paragraph ASC 606-10-55-65 applies. Therefore, the Company recognizes revenue at a point in time, only as the subsequent sale occurs. However, the Company notes that such sales being reported by the licensee with a quarter in arrears, such revenue is recognized at the time it is reported and paid by the licensee given that any estimated variable consideration would have to be fully constrained due to the unpredictability of such estimate and the unavoidable risk that it may lead to significant revenue reversals. For the arrangement with one customer, the Company had concluded that there is one combined performance obligation to be satisfied. Therefore, the Company recognizes revenue related to this arrangement over time.

5. Exclusive Distribution Rights: On March 2, 2021, the Company and Topcon Corporation (“Topcon”) entered into a distribution agreement (“Distribution Agreement”), pursuant to which the Company granted Topcon the exclusive right to distribute the Company’s retina and glaucoma products in certain geographies outside the United States. The exclusivity arrangement with Topcon obligates the Company to provide training, customer support, and exclusive territorial rights to Topcon for certain international regions, for a period of 10 years, commencing upon regulatory approval to transfer existing (non-exclusive) distribution rights from the current distributors in those regions to Topcon. The Company has the right to terminate the exclusive distribution rights granted to Topcon for any of the regions at any point in time during the 10 year exclusivity term for a termination fee that is based on a multiple of 1.2 times the revenue generated by the Company in 2019 for the respective region. Management has determined that the exclusivity rights, training, and customer support represents a single combined performance obligation for each region, to be recognized as exclusivity fee revenue on a straight-line basis over the 10 year period for each region, commencing on the date that regulatory approval is obtained for each region, based on the standalone selling price for such combined performance obligation for each region. The estimated fair value of the exclusive distribution rights for all regions combined totaled approximately $14.8 million. Of this amount, management has fully-constrained and returned to Topcon the arrangement fee allocated to Belarus (approximately $0.2 million) because obtaining the necessary regulatory approvals and termination of existing distributor relationship was not feasible. For each of the three months ended June 29, 2024 and July 1, 2023, $0.4 million and $0.3 million in revenue related to the exclusive distribution rights were recorded, respectively. For each of the six months ended June 29, 2024 and July 1, 2023, $0.7 million in revenue related to the exclusive distribution rights were recorded.

Costs of Obtaining Revenue Contracts

The Company recognized assets from certain costs incurred to obtain revenue contracts. These costs relate to sales commissions arising from the sale of our products. The costs are considered incremental and recoverable of obtaining revenue contracts with customers. These deferred costs are amortized on a straight-line basis over the estimated period of benefit, which typically ranges from 2 to 3 years. As of June 29, 2024, the Company recognized deferred costs incurred to obtain revenue contracts with customers, net of accumulated amortization, of $0.1 million, and included these amounts in Prepaid expenses and other current assets and Other long-term assets in the Company’s condensed consolidated balance sheets. Amortization expense was $19 thousand and $38 thousand for both of the three and six months ended June 29, 2024 and July 1, 2023. There were no impairment expenses for both of the three and six months ended June 29, 2024 and July 1, 2023, respectively.

Sales commissions that do not represent incremental and recoverable costs of obtaining a contract are expensed as incurred. As a practical expedient, the Company will not recognize such sales commission as a contract asset but rather recognize as an expense when incurred if the amortization period of the asset that the Company would have otherwise recognized is one year or less.

Contract Fulfillment Costs

The Company recognized an asset from the costs incurred to fulfill a contract. These costs relate directly and must be incurred to satisfy performance obligations on certain specific contract with a customer. These costs are expected to be recovered over time and are amortized on a systematic basis that is consistent with the recognition of revenue to which it relates. As of June 29, 2024, the Company recognized deferred costs incurred to fulfill a contract with a customer, net of accumulated amortization, of $0.6 million, and included these amounts in Prepaid expenses and other current assets and Other long-term assets in the Company’s condensed consolidated balance sheets. Amortization expense was $21 thousand and $41 thousand for both of the three and six months ended June 29, 2024 and July 1, 2023. There were no impairment expenses for each of three and six months ended June 29, 2024 and July 1, 2023.

Leases

We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use (“ROU”) assets, net and Operating lease liabilities in our condensed consolidated balance sheets. As of June 29, 2024 and December 30, 2023, the Company was not a party to any finance lease arrangements.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on information available at the commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Under the available practical expedient, we account for the lease and non-lease components as a single lease component.

Concentration of Credit Risk and Other Risks and Uncertainties

Our cash and cash equivalents are deposited in demand and money market accounts. Deposits held with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand.

We market our products to distributors and end-users throughout the world. Sales to international distributors are generally made on open credit terms and letters of credit. Management performs ongoing credit evaluations of our customers and maintains a provision for potential credit losses. Historically, we have not experienced any significant losses related to individual customers or a group of customers in any particular geographic area. For the three and six months ended June 29, 2024, one customer, Topcon, accounted for more than 10% of total revenues, representing 38% and 35%, respectively. For the three and six months ended July 1, 2023, one customer, Topcon, accounted for more than 10% of total revenues, representing 28% and 30%, respectively As of June 29, 2024, one customer, Topcon, accounted for over 10% of our accounts receivable, representing 19%. As of December 30, 2023, one customer, Topcon, accounted for more than 10% of our accounts receivable, representing 30%.

Taxes Collected from Customers and Remitted to Governmental Authorities

Taxes collected from customers and remitted to governmental authorities are recognized on a net basis in the accompanying condensed consolidated statements of operations.

Shipping and Handling Costs

Our shipping and handling costs billed to customers are included in revenues and the associated expense is recorded in cost of revenues for all periods presented.

Deferred Revenue

Deferred revenue represents contract liabilities and exclusivity fees. Revenue related to service contracts is deferred and recognized on a straight-line basis over the period of the applicable service contract. Costs associated with these service arrangements are recognized as incurred. Revenue related to exclusivity fees is deferred and recognized over the related exclusivity period.

A reconciliation of the changes in the Company’s deferred revenue balance for the six months ended June 29, 2024 and July 1, 2023, is as follows:


	Six Months Ended
	June 29, 2024			July 1, 2023
Balance, beginning of period	$	12,429		$	14,153
Additions to deferral		678			607
Revenue recognized		(1,556	)		(1,569	)
Balance, end of the period		11,551			13,191
Non-current portion of deferred revenue		9,261			10,881
Current portion of deferred revenue	$	2,290		$	2,310

During the six months ended June 29, 2024 and July 1, 2023, approximately $1.4 million and $0.9 million was recognized pertaining to amounts deferred as of December 30, 2023 and December 31, 2022, respectively. As of June 29, 2024, approximately $9.0 million of the non-current portion of deferred revenue and $1.5 million of the current portion of deferred revenue pertain to exclusivity distribution rights deferred revenue.

Warranty

The Company currently provides a two-year full warranty on its products. The associated costs of these warranties are accrued for upon shipment of the products. The Company’s warranty policy is applicable to products which are considered defective in their performance or fail to meet the product specifications. Warranty costs are reflected in the condensed consolidated statements of operations as cost of revenues.

As warranty reserves do not meet the criteria to have separate captions on the face of the condensed consolidated balance sheet, we removed these captions and included those amounts in other current and long-term liabilities.

Implementation Costs Incurred in a Cloud Computing Service Arrangement

The Company has implemented a new enterprise resource planning (“ERP”) system. The new ERP system operates in a cloud-based environment. The Company concluded that this cloud computing arrangement does not include a license, and therefore, will account for this arrangement as one that is a service contract. The Company capitalized $1.1 million in implementation costs and began utilizing the ERP system near the end of the third quarter of 2023 and is recognizing amortization of the capitalized implementation costs over five years on a straight-line basis. For the six months ended June 29, 2024 approximately $113 thousand of amortization expenses were recorded. There were no amortization expenses for the six months ended July 1, 2023.

Recent Accounting Standards Not Yet Adopted

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for our annual periods beginning after December 15, 2023, and for interim periods beginning after December 15, 2024, with

early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09 “Income Taxes (Topics 740): Improvements to Income Tax Disclosures” to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for the Company’s annual periods beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.

Leases and Commitments and Contingencies (Tables)

6 Months Ended

Jun. 29, 2024

Commitments and Contingencies Disclosure [Abstract]

Schedule of Maturities of Operating Lease Liabilities

The following represents maturities of operating lease liabilities as of June 29, 2024 (in thousands):


Fiscal Year	Operating Lease Payments
Remainder of 2024 (six months)	$	558
2025		1,111
2026		762
Total lease payments		2,431
Less: Imputed interest		(142	)
Total lease liabilities		2,289
Non-current portion of lease liabilities		(1,294	)
Current portion of lease liabilities	$	995

Leases and Commitments and Contingencies - Schedule of Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 29, 2024	Dec. 30, 2023
Lessee, Operating Lease, Liability, to be Paid, Fiscal Year Maturity [Abstract]
Remainder of 2024 (six months)	$ 558
2025	1,111
2026	762
Total lease payments	2,431
Less: Imputed interest	(142)
Total lease liabilities	2,289
Non-current portion of lease liabilities	(1,294)	$ (1,751)
Current portion of lease liabilities	$ 995	$ 995

Business Segments - Additional Information (Details) - Segment	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Segment Reporting Information [Line Items]
Number of operating segments			1
United States \| Geographic Concentration Risk \| Revenue, Total
Segment Reporting Information [Line Items]
Customer and supplier accounted percentage of total revenues, accounts receivable and purchases	44.30%	52.40%	44.80%	50.90%
NETHERLANDS \| Geographic Concentration Risk \| Revenue, Total
Segment Reporting Information [Line Items]
Percentage of accounts receivable accounted	12.00%		14.50%
NETHERLANDS \| Geographic Concentration Risk \| Revenue, Total \| Minimum [Member]
Segment Reporting Information [Line Items]
Customer and supplier accounted percentage of total revenues, accounts receivable and purchases	10.00%	10.00%	10.00%	10.00%
Percentage of accounts receivable accounted		12.00%
NETHERLANDS \| Geographic Concentration Risk \| Revenue, Total \| Maximum [Member]
Segment Reporting Information [Line Items]
Percentage of accounts receivable accounted		14.00%

Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 29, 2024 USD ($) Customer	Jul. 01, 2023 USD ($) Customer	Jun. 29, 2024 USD ($) Customer	Jul. 01, 2023 USD ($) Customer	Dec. 30, 2023 Customer	Sep. 30, 2023 USD ($)
Disclosure Summary Of Significant Accounting Policies [Line Items]
Service contract warranty period			1 year
Service contract, period to determine nature of sale			60 days
Arrangement fee			$ 200
Fair value of distribution right			14,800
Amortization cost	$ 21	$ 41	21	$ 41
Impairments expenses	0	0	0	0
Deferred revenue recognized			1,400	900
Non-current portion of deferred revenue pertains to exclusivity fee deferred revenue	9,000		9,000
Current portion of deferred revenue pertains to exclusivity fee deferred revenue	1,500		$ 1,500
Products warranty period			2 years
Capitalized implementation costs						$ 1,100
Capitalized implementation costs amortization period					5 years
Amortization expense			$ 113	0
Prepaid Expenses and Other Current Assets and Other Long Term Assets
Disclosure Summary Of Significant Accounting Policies [Line Items]
Deferred costs incurred	600		600
Revenue, Total
Disclosure Summary Of Significant Accounting Policies [Line Items]
Amortization cost	19	38	19	38
Impairments expenses	$ 0	$ 0	$ 0	$ 0
Revenue, Total \| Minimum [Member]
Disclosure Summary Of Significant Accounting Policies [Line Items]
Amortization period	2 years		2 years
Revenue, Total \| Maximum [Member]
Disclosure Summary Of Significant Accounting Policies [Line Items]
Amortization period	3 years		3 years
Revenue, Total \| Prepaid Expenses and Other Current Assets and Other Long Term Assets
Disclosure Summary Of Significant Accounting Policies [Line Items]
Deferred costs incurred	$ 100		$ 100
Revenue, Total \| Topcon [Member] \| Customer Concentration Risk
Disclosure Summary Of Significant Accounting Policies [Line Items]
Number of customers \| Customer	1	1	1	1
Accounts Receivable \| Topcon [Member] \| Credit Concentration Risk
Disclosure Summary Of Significant Accounting Policies [Line Items]
Number of customers \| Customer			1		1
Percentage of accounts receivable accounted			19.00%		30.00%
Accounts Receivable \| Topcon [Member] \| Credit Concentration Risk \| One Customer \| Minimum [Member]
Disclosure Summary Of Significant Accounting Policies [Line Items]
Customer and supplier accounted percentage of total revenues, accounts receivable and purchases			10.00%		10.00%
Revenue, Total \| Topcon [Member] \| Customer Concentration Risk
Disclosure Summary Of Significant Accounting Policies [Line Items]
Percentage of accounts receivable accounted	38.00%	28.00%	35.00%	30.00%
Revenue, Total \| Topcon [Member] \| Customer Concentration Risk \| One Customer \| Minimum [Member]
Disclosure Summary Of Significant Accounting Policies [Line Items]
Customer and supplier accounted percentage of total revenues, accounts receivable and purchases	10.00%	10.00%	10.00%	10.00%
Distribution Rights [Member]
Disclosure Summary Of Significant Accounting Policies [Line Items]
Revenue Recognized	$ 400	$ 300	$ 700	$ 700
Royalty Agreements
Disclosure Summary Of Significant Accounting Policies [Line Items]
Number of customers \| Customer			2

Inventories - Components of Inventories (Details) - USD ($) $ in Thousands	Jun. 29, 2024	Dec. 30, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 4,926	$ 5,288
Work in process	20	156
Finished goods	6,178	4,462
Total inventories	$ 11,124	$ 9,906

Stock-Based Compensation - Summary of Stock Options Outstanding, Vested, Expected to Vest and Exercisable (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 29, 2024	Dec. 30, 2023
Stock options outstanding, exercisable and expected to vest
Options outstanding, Number of Shares	2,287,420	2,757,921
Options vested and expected to vest, Number of Shares	2,230,362
Options exercisable, Number of Shares	1,258,699
Options outstanding, Weighted Average Exercise Price	$ 3.37	$ 3.60
Options vested and expected to vest, Weighted Average Exercise Price	3.4
Options exercisable, Weighted Average Exercise Price	$ 4.03
Options outstanding, Weighted Average Remaining Contractual Life (Years)	4 years 3 months 14 days
Options vested and expected to vest, Weighted Average Remaining Contractual Life (Years)	4 years 2 months 26 days
Options exercisable, Weighted Average Remaining Contractual Life (Years)	3 years 10 days
Options outstanding, Aggregate Intrinsic Value	$ 36
Options vested and expected to vest, Aggregate Intrinsic Value	34
Options exercisable, Aggregate Intrinsic Value	$ 12

Related Party - Topcon

6 Months Ended

Jun. 29, 2024

Related Party - Topcon

4. Related Party - Topcon

As of June 29, 2024, Topcon holds a 9.9% voting interest in the Company, which qualifies it to be a principal owner and considered a related party, even though it currently does not have significant influence over the Company’s operations.

Topcon resells certain of our products as our exclusive distributor in certain international regions. At the same time, the Company also purchases certain raw materials from Topcon. During the three and six months ended June 29, 2024, the Company’s revenues related to Topcon amounted to approximately $4.1 million and $7.4 million, including $0.4 million and $0.7 million, respectively, in recognized exclusive distribution rights revenue. During the three and six months ended July 1, 2023, the Company’s revenues related to Topcon amounted to approximately $3.7 million and $8.0 million, respectively, including $0.3 million and $0.7 million, respectively, in recognized exclusive distribution rights revenue. The Company’s purchases from Topcon during the three and six months ended June 29, 2024 amounted to approximately $0.1 million and $0.2 million, respectively. As of June 29, 2024, the amounts receivable from and payable to Topcon were $1.8 million and $0.5 million, respectively. As of December 30, 2023, the amounts receivable from and payable to Topcon were $2.9 million and $0.2 million, respectively.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-6

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(g)(3))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(c))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(e))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/850/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-6

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

+ Details

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Cumulative Effect Period of Adoption Adjustment	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Accumulated Deficit Cumulative Effect Period of Adoption Adjustment
Beginning Balance, value at Dec. 31, 2022	$ 17,231		$ 169	$ 86,802	$ (24)	$ (69,716)
Beginning Balance, value (Adoption of ASU 2016-13) at Dec. 31, 2022		$ 244					$ 244
Beginning Balance, shares at Dec. 31, 2022			15,989,662
Issuance of common stock under the stock option plan	37			37
Issuance of common stock under the stock option plan, shares			17,499
Stock-based compensation expense	873			873
Release of restricted stock, net of taxes paid	(63)		$ 2	(65)
Release of restricted stock, net of taxes paid, shares			199,221
Other comprehensive income (loss)	(16)				(16)
Net loss	(4,856)					(4,856)
Ending Balance, value at Jul. 01, 2023	13,450		$ 171	87,647	(40)	(74,328)
Ending Balance, shares at Jul. 01, 2023			16,206,382
Beginning Balance, value at Apr. 01, 2023	15,884		$ 169	87,312	(35)	(71,562)
Beginning Balance, shares at Apr. 01, 2023			16,007,161
Stock-based compensation expense	400			400
Release of restricted stock, net of taxes paid	(63)		$ 2	(65)
Release of restricted stock, net of taxes paid, shares			199,221
Other comprehensive income (loss)	54				54
Net loss	(2,766)					(2,766)
Ending Balance, value at Jul. 01, 2023	13,450		$ 171	87,647	(40)	(74,328)
Ending Balance, shares at Jul. 01, 2023			16,206,382
Beginning Balance, value at Dec. 30, 2023	$ 9,522		$ 172	88,444	(52)	(79,042)
Beginning Balance, shares at Dec. 30, 2023	16,252,813		16,252,813
Issuance of common stock under the stock option plan, shares	135		135
Stock-based compensation expense	$ 813			813
Release of restricted stock, net of taxes paid, shares			196,335
Other comprehensive income (loss)	(5)				(5)
Net loss	(6,143)					(6,143)
Ending Balance, value at Jun. 29, 2024	$ 4,246		$ 172	89,257	2	(85,185)
Ending Balance, shares at Jun. 29, 2024	16,449,283		16,449,283
Beginning Balance, value at Mar. 30, 2024	$ 6,488		$ 172	88,838	(16)	(82,506)
Beginning Balance, shares at Mar. 30, 2024			16,252,813
Issuance of common stock under the stock option plan, shares			135
Stock-based compensation expense	419			419
Release of restricted stock, net of taxes paid, shares			196,335
Other comprehensive income (loss)	18				18
Net loss	(2,679)					(2,679)
Ending Balance, value at Jun. 29, 2024	$ 4,246		$ 172	$ 89,257	$ 2	$ (85,185)
Ending Balance, shares at Jun. 29, 2024	16,449,283		16,449,283

Summary of Significant Accounting Policies - Reconciliation of Changes in Deferred Revenue (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Dec. 30, 2023
Reconciliation of the changes in the Company's deferred revenue balance
Balance, beginning of period	$ 12,429	$ 14,153
Additions to deferral	678	607
Revenue recognized	(1,556)	(1,569)
Balance, end of period	11,551	13,191	$ 12,429
Non-current portion of deferred revenue	9,261	10,881	10,025
Current portion of deferred revenue	$ 2,290	$ 2,310	$ 2,404

Inventories (Tables)

6 Months Ended

Jun. 29, 2024

Inventory Disclosure [Abstract]

Components of Inventories

The components of the Company’s inventories as of June 29, 2024 and December 30, 2023 are as follows:


	June 29, 2024		December 30, 2023
Raw materials	$	4,926	$	5,288
Work in process		20		156
Finished goods		6,178		4,462
Total inventories	$	11,124	$	9,906

Subsequent Event

6 Months Ended

Jun. 29, 2024

Subsequent Events [Abstract]

Subsequent Event

13. Subsequent Event

On August 4, 2024, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Lind Global Asset Management IX LLC, an entity managed by The Lind Partners, LLC (together, “Lind”) pursuant to which the Company issued a senior convertible promissory note (the “Note”) to Lind, raising net proceeds of approximately $3.4 million at closing. Subject to certain conditions, the Company may issue a subsequent note with substantially similar terms (the “Subsequent Note”, and together with the Note, the “Lind Notes”) to Lind for additional proceeds of approximately $1.5 million.

The Note has (and the Subsequent Note, if issued, will have) a 24-month term. The Note was issued on August 7, 2024 and has a principal amount of $4,200,000 and the Subsequent Note, if issued, will have a principal amount of up to $1,800,000. The Note is convertible at Lind’s option into shares of the Company’s common stock at an initial conversion price of $2.44, subject to any adjustments set forth in the Note, provided no such adjustment shall result in a conversion price that is less than $0.39. Commencing 120 days from the issuance date of the Note, subject to certain conditions, the Company will repay the outstanding principal amount of the Note in twenty consecutive monthly installments. At the Company’s option, such repayments can be made in cash plus a 4% premium, a number of shares of the Company’s common stock (the “Repayment Shares”) determined by dividing the portion of the principal amount of the Note being paid in shares of the Company’s common stock by 90% of the average of the five (5) lowest daily VWAPs during the twenty (20) trading days prior to the applicable payment date (subject to a floor price of $0.39), or a combination of cash and Repayment Shares.

The total number of shares of the Company’s common stock issuable pursuant to the terms of the Transaction Documents (as defined in the Securities Purchase Agreement) is capped at (i) prior to the receipt of stockholder approval, a number of shares of the Company’s common stock equal to 19.99% of the number of shares of the Company’s common stock outstanding as of August 4, 2024, and (ii) following the receipt of stockholder approval, a number of shares of the Company’s common stock equal to 30% of the number of shares of the Company’s common stock outstanding as of August 4, 2024.

Refer to our 8-K filed on August 5, 2024 for further details.

Income Taxes

6 Months Ended

Jun. 29, 2024

Income Tax Disclosure [Abstract]

Income Taxes

10. Income Taxes

Provision for Income Tax

The Company calculates its interim tax provision in accordance with the provisions of ASC Topic 740-270, Income Taxes; Interim Reporting. For interim periods, the Company estimates its annual effective income tax rate and applies the estimated rate to the year-to-date income or loss before income taxes. The Company also computes the tax provision or benefit related to items reported separately and recognizes the items net of their related tax effect in the interim periods in which they occur. The Company also recognizes the effect of changes in enacted tax laws or rates in the interim periods in which the changes occur. The Company recorded a provision for income tax of $57 thousand and $22 thousand for the six months ended June 29, 2024 and July 1, 2023, respectively.

Deferred Income Taxes

The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes (“ASC 740”), which requires that deferred tax assets and liabilities be recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax assets will not be realized. As of the second quarter of fiscal year 2024, based on the Company’s recent history of losses and its forecasted losses, management believes it is more likely than not that a full valuation allowance is required. Accordingly, the Company continues to provide a full valuation allowance on its federal and states deferred tax assets.

Uncertain Tax Positions

The Company accounts for its uncertain tax positions in accordance with ASC 740. As of December 30, 2023, the Company had $1.4 million of unrecognized tax benefits, none of the unrecognized tax benefits would result in a change in the Company’s effective tax rate if recognized in future years.

The Company is not aware of any other uncertain tax positions that could result in significant additional payments, accruals, or other material deviation in this estimate during the fiscal year.

The Company is subject to United States federal income tax as well as to income taxes in state jurisdictions. The Company’s federal and state income tax returns are open to examination by tax authorities for three years and three to five years, respectively.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 2: http://www.xbrl.org/2003/role/exampleRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Summary of Significant Accounting Policies

6 Months Ended

Jun. 29, 2024

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

The Company’s significant accounting policies are disclosed in our Annual Report on Form 10-K for the year ended December 30, 2023, which was filed with the SEC on March 29, 2024.

Financial Statement Presentation

Use of Estimates

Revenue Recognition

The Company recognizes revenue from product sales at a point in time subject to the allocation of transaction price to additional performance obligations, if any.

System Repairs (outside of warranty): Customers will occasionally request repairs from the Company subsequent to the expiration of the standard warranty and outside of a service contract.

Costs of Obtaining Revenue Contracts

Contract Fulfillment Costs

Leases

Under the available practical expedient, we account for the lease and non-lease components as a single lease component.

Concentration of Credit Risk and Other Risks and Uncertainties

Taxes Collected from Customers and Remitted to Governmental Authorities

Taxes collected from customers and remitted to governmental authorities are recognized on a net basis in the accompanying condensed consolidated statements of operations.

Shipping and Handling Costs

Our shipping and handling costs billed to customers are included in revenues and the associated expense is recorded in cost of revenues for all periods presented.

Deferred Revenue

A reconciliation of the changes in the Company’s deferred revenue balance for the six months ended June 29, 2024 and July 1, 2023, is as follows:


	Six Months Ended
	June 29, 2024			July 1, 2023
Balance, beginning of period	$	12,429		$	14,153
Additions to deferral		678			607
Revenue recognized		(1,556	)		(1,569	)
Balance, end of the period		11,551			13,191
Non-current portion of deferred revenue		9,261			10,881
Current portion of deferred revenue	$	2,290		$	2,310

Warranty

Implementation Costs Incurred in a Cloud Computing Service Arrangement

Recent Accounting Standards Not Yet Adopted

early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.

Goodwill and Intangible Assets (Tables)

6 Months Ended

Jun. 29, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Components of Gross and Net Intangible Asset

The following table summarizes the components of gross and net of intangible assets carrying amounts (in thousands):


	June 29, 2024							December 30, 2023
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Useful Lives Remaining	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relations	$	340	$	274	$	66	3.12 Years	$	340	$	260	$	80
Developed technology		1,899		679		1,220	4.64 Years		1,899		543		1,356
Trade names		300		111		189	5.67 Years		300		94		206
Patents		600		600		—	Varies		600		600		—
	$	3,139	$	1,664	$	1,475		$	3,139	$	1,497	$	1,642

Estimated Future Amortization Expense for Purchased Intangible Assets

Estimated future amortization expense for purchased intangible assets is as follows (in thousands):


Fiscal Year:
Remainder of 2024 (six months)	$	168
2025		323
2026		319
2027		319
2028		200
Thereafter		146
Total	$	1,475

Fair Value Measurements (Tables)

6 Months Ended

Jun. 29, 2024

Fair Value Disclosures [Abstract]

Financial Assets Measured and Recognized at Fair Value on a Recurring Basis

As of June 29, 2024 and December 30, 2023, financial assets measured and recognized at fair value on a recurring basis and classified under the appropriate level of the fair value hierarchy as described above were as follows (in thousands):


	As of June 29, 2024								As of December 30, 2023
	Fair Value Measurements								Fair Value Measurements
(in thousands)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	1,238	$	—	$	—	$	1,238	$	43	$	—	$	—	$	43

Subsequent Event - Additional Information (Details) - Subsequent Event - Senior Convertible Promissory Note - Lind Global Asset Management IX LLC - USD ($)	Aug. 07, 2024	Aug. 04, 2024
Subsequent Event [Line Items]
Proceeds from notes payable		$ 3,400,000
Term of notes		24 months
Face value of initial note	$ 4,200,000
Note issuance date	Aug. 07, 2024
Debt instrument, convertible conversion price	$ 2.44
Notes repayment terms	Commencing 120 days from the issuance date of the Note, subject to certain conditions, the Company will repay the outstanding principal amount of the Note in twenty consecutive monthly installments. At the Company’s option, such repayments can be made in cash plus a 4% premium, a number of shares of the Company’s common stock (the “Repayment Shares”) determined by dividing the portion of the principal amount of the Note being paid in shares of the Company’s common stock by 90% of the average of the five (5) lowest daily VWAPs during the twenty (20) trading days prior to the applicable payment date (subject to a floor price of $0.39), or a combination of cash and Repayment Shares.
Debt instrument repayment premium percentage	4.00%
Debt Instrument, convertible percentage of stock	19.99%
Minimum
Subsequent Event [Line Items]
Debt instrument, convertible conversion price	$ 0.39
Maximum
Subsequent Event [Line Items]
Debt Instrument, convertible percentage of stock	30.00%
Subsequent Note
Subsequent Event [Line Items]
Proceeds from notes payable		$ 1,500,000
Face value of initial note	$ 1,800,000

Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - $ / shares	Jun. 29, 2024	Dec. 30, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	2,000,000	2,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	30,000,000	30,000,000
Common stock, shares issued	16,449,283	16,252,813
Common stock, shares outstanding	16,449,283	16,252,813

Goodwill and Intangible Assets - Estimated Future Amortization Expense for Purchased Intangible Assets (Details) $ in Thousands	Jun. 29, 2024 USD ($)
Estimated future amortization expense
Remainder of 2024 (six months)	$ 168
2025	323
2026	319
2027	319
2028	200
Thereafter	146
Net Carrying Amount	$ 1,475

Stock-Based Compensation - Summary of Stock Options (Details) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 29, 2024 USD ($) $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract]
Outstanding, Number of Shares, Beginning Balance \| shares	2,757,921
Number of Shares, Options Granted \| shares	20,300
Number of Shares, Options Exercised \| shares	(135)
Number of Shares, Options Cancelled or forfeited \| shares	(490,666)
Outstanding, Number of Shares, Ending Balance \| shares	2,287,420
Outstanding, Weighted Average Exercise Price Per Share, Beginning Balance \| $ / shares	$ 3.60
Weighted Average Exercise Price Per Share, Options Granted \| $ / shares	2.94
Weighted Average Exercise Price, Options Exercised \| $ / shares	2.32
Weighted Average Exercise Price Per Share, Options Cancelled or forfeited \| $ / shares	4.68
Outstanding, Weighted Average Exercise Price Per Share, Ending Balance \| $ / shares	$ 3.37
Aggregate Intrinsic Value, Ending Balance \| $	$ 36

Computation of Basic and Diluted Net Loss Per Share (Tables)

6 Months Ended

Jun. 29, 2024

Earnings Per Share [Abstract]

Reconciliation of Numerator and Denominator of Basic and Diluted Net Loss Per Common Share

A reconciliation of the numerator and denominator of basic and diluted net loss per common share is provided as follows (in thousands except per share data):


	Three Months Ended							Six Months Ended
	June 29, 2024				July 1, 2023			June 29, 2024				July 1, 2023
Numerator:
Net loss	$	(2,679	)	$	$	(2,766	)	$	(6,143	)	$	$	(4,856	)
Denominator:
Weighted average shares of common stock (basic)		16,287				16,036			16,270				16,018
Weighted average shares of common stock (diluted)		16,287				16,036			16,270				16,018
Per share data:
Basic net loss per share	$	(0.16	)	$	$	(0.17	)	$	(0.38	)	$	$	(0.30	)
Diluted net loss per share	$	(0.16	)	$	$	(0.17	)	$	(0.38	)	$	$	(0.30	)

Accounts Receivable and Provision for Credit Losses - Summary of Activity in Provision for Credit Losses for Accounts Receivable (Details) $ in Thousands	6 Months Ended
	Jun. 29, 2024 USD ($)
Accounts Receivable, Allowance for Credit Loss [Line Items]
Balance, beginning of period	$ (146)
Change to provision	34
Balance, end of period	(112)
Domestic
Accounts Receivable, Allowance for Credit Loss [Line Items]
Balance, beginning of period	(94)
Change to provision	16
Balance, end of period	(78)
International
Accounts Receivable, Allowance for Credit Loss [Line Items]
Balance, beginning of period	(52)
Change to provision	18
Balance, end of period	$ (34)

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 29, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Stock-Based Compensation - Restricted Stock Units (Details) - Restricted Stock Units (RSUs)	6 Months Ended
	Jun. 29, 2024 shares
Restricted stock units
Outstanding, Number of Shares, Beginning Balance	353,212
Number of Shares, RSUs granted	120,000
Number of Shares, RSUs released	(196,335)
Number of Shares, RSUs forfeited	(16,669)
Outstanding, Number of Shares, Ending Balance	260,208

Computation of Basic and Diluted Net Loss Per Share

6 Months Ended

Jun. 29, 2024

Earnings Per Share [Abstract]

Computation of Basic and Diluted Net Loss Per Share

11. Computation of Basic and Diluted Net Loss Per Share

Basic and diluted net loss per share is based upon the weighted average number of common shares outstanding during the period. Common stock equivalents consist of incremental common shares issuable upon the exercise of stock options, and the release (vesting) of RSUs and awards and are calculated under the treasury stock method. Common stock equivalent shares from unexercised stock options, and unvested RSUs and awards are excluded from the computation for periods in which we incur a net loss or if the exercise price of such options is greater than the average market price of our common stock for the period as their effect would be anti-dilutive.

For the three months ended June 29, 2024 and July 1, 2023, potential shares from stock options and RSUs totaling 2,856,244 and 2,260,886 shares, respectively, were excluded from the computation of diluted weighted average shares outstanding. For the six months ended June 29, 2024 and July 1, 2023, potential shares from stock options and RSUs totaling 2,878,936 and 2,281,161 shares, respectively, were excluded from the computation of diluted weighted average shares outstanding.

A reconciliation of the numerator and denominator of basic and diluted net loss per common share is provided as follows (in thousands except per share data):


	Three Months Ended							Six Months Ended
	June 29, 2024				July 1, 2023			June 29, 2024				July 1, 2023
Numerator:
Net loss	$	(2,679	)	$	$	(2,766	)	$	(6,143	)	$	$	(4,856	)
Denominator:
Weighted average shares of common stock (basic)		16,287				16,036			16,270				16,018
Weighted average shares of common stock (diluted)		16,287				16,036			16,270				16,018
Per share data:
Basic net loss per share	$	(0.16	)	$	$	(0.17	)	$	(0.38	)	$	$	(0.30	)
Diluted net loss per share	$	(0.16	)	$	$	(0.17	)	$	(0.38	)	$	$	(0.30	)

Business Segments

6 Months Ended

Jun. 29, 2024

Segment Reporting [Abstract]

Business Segments

12. Business Segments

The Company operates in one segment: ophthalmology. The Company develops, manufactures and markets medical devices. Our revenues arise from the sale of consoles, delivery devices, consumables, service, and support activities.

Revenue information shown by product group is as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023
Cyclo G6	$	3,336	$	3,658	$	6,289	$	7,327
Retina		7,295		6,857		14,069		14,071
Other(1)		2,000		2,340		4,034		5,163
Total revenues	$	12,631	$	12,855	$	24,392	$	26,561

Revenue information shown by geographic region, based on the sales destination, is as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023
United States	$	5,598	$	6,742	$	10,919	$	13,516
Europe, Middle East and Africa		2,667		2,843		6,365		7,020
Asia/Pacific Rim		3,597		2,482		6,042		4,625
Americas, excluding the U.S.		769		788		1,066		1,400
	$	12,631	$	12,855	$	24,392	$	26,561

Revenues are attributed to countries based on the location of end customers.

Other than the United States, the Netherlands accounted for at least 10% of the Company’s revenues during the three and six months ended June 29, 2024, representing 12% and 14.5%, respectively. Other than the United States, the Netherlands accounted for at least 10% of the Company’s revenues during the three and six months ended July 1, 2023, representing 12% and 14%, respectively. The United States accounted for 44.3% and 52.4% of revenues for the three months ended June 29, 2024 and July 1, 2023, respectively, and 44.8% and 50.9% for the six months ended June 29, 2024 and July 1, 2023, respectively.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

Fair Value Measurements

6 Months Ended

Jun. 29, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

7. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

•

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities.

•

Level 2: Directly or indirectly observable inputs as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument.

•

Level 3: Unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions.

In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value.

The carrying amounts of the Company’s financial assets and liabilities, including cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses as of June 29, 2024 and December 30, 2023, approximate fair value because of the short maturity of these instruments.


	As of June 29, 2024								As of December 30, 2023
	Fair Value Measurements								Fair Value Measurements
(in thousands)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	1,238	$	—	$	—	$	1,238	$	43	$	—	$	—	$	43

The Company’s Level 1 financial assets are money market funds whose fair values are based on quoted market prices. The Company does not have any Level 2 and Level 3 financial assets or liabilities.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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+ Details

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Statement of Comprehensive Income [Abstract]
Net loss	$ (2,679)	$ (2,766)	$ (6,143)	$ (4,856)
Change in foreign currency translation adjustments	18	(5)	54	(16)
Comprehensive loss	$ (2,661)	$ (2,771)	$ (6,089)	$ (4,872)

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners.

+ References + Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Computation of Basic and Diluted Net Loss Per Share - Reconciliation of Numerator and Denominator of Basic and Diluted Net Loss Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Numerator:
Net loss	$ (2,679)	$ (2,766)	$ (6,143)	$ (4,856)
Denominator:
Weighted average shares of common stock (basic)	16,287	16,036	16,270	16,018
Weighted average shares of common stock (diluted)	16,287	16,036	16,270	16,018
Per share data:
Basic net loss per share	$ (0.16)	$ (0.17)	$ (0.38)	$ (0.3)
Diluted net loss per share	$ (0.16)	$ (0.17)	$ (0.38)	$ (0.3)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

+ References

+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Business Segments - Schedule of Revenue Information by Product (Parenthetical) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Entity Wide Information Revenue From External Customer [Line Items]
Total revenues	$ 12,631	$ 12,855	$ 24,392	$ 26,561
Distribution Rights [Member]
Entity Wide Information Revenue From External Customer [Line Items]
Revenue Recognized	400	300	700	700
Service Contract Revenues
Entity Wide Information Revenue From External Customer [Line Items]
Total revenues	100	300	400	800
Service Contract Revenues \| Distribution Rights [Member]
Entity Wide Information Revenue From External Customer [Line Items]
Revenue Recognized	$ 400	$ 400	$ 700	$ 700

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Leases and Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023
Commitments and Contingencies Disclosure [Abstract]
Operating lease, expenses	$ 0.5	$ 0.5
Operating lease, weighted average discount rate	4.80%
Operating lease, weighted average remaining lease term	2 years 2 months 12 days
Future minimum purchase commitment payments, next 12 months	$ 8.1
Future minimum purchase commitment payments	$ 14.1

Business Segments - Schedule of Revenue Information by Product (Details) - USD ($)
$ in Thousands

3 Months Ended

6 Months Ended

Jun. 29, 2024

Jul. 01, 2023

Jun. 29, 2024

Jul. 01, 2023

Entity Wide Information Revenue From External Customer [Line Items]

Total revenues

$ 12,631

$ 12,855

$ 24,392

$ 26,561

Cyclo G6

Entity Wide Information Revenue From External Customer [Line Items]

Total revenues

3,336

3,658

6,289

7,327

Retina

Entity Wide Information Revenue From External Customer [Line Items]

Total revenues

7,295

6,857

14,069

14,071

Other

Entity Wide Information Revenue From External Customer [Line Items]

Total revenues

^[1]

$ 2,000

$ 2,340

$ 4,034

$ 5,163

[1]

- Definition

+ References

+ Details

Goodwill and Intangible Assets - Summary of Components of Gross and Net Intangible Asset (Details) - USD ($) $ in Thousands	Jun. 29, 2024	Dec. 30, 2023
Schedule of Intangible Assets
Gross Carrying Value	$ 3,139	$ 3,139
Accumulated Amortization	1,664	1,497
Net Carrying Value	1,475	1,642
Customer Relations
Schedule of Intangible Assets
Gross Carrying Value	340	340
Accumulated Amortization	274	260
Net Carrying Value	$ 66	80
Useful Lives Remaining	3 years 1 month 13 days
Developed Technology
Schedule of Intangible Assets
Gross Carrying Value	$ 1,899	1,899
Accumulated Amortization	679	543
Net Carrying Value	$ 1,220	1,356
Useful Lives Remaining	4 years 7 months 20 days
Trade Names
Schedule of Intangible Assets
Gross Carrying Value	$ 300	300
Accumulated Amortization	111	94
Net Carrying Value	$ 189	206
Useful Lives Remaining	5 years 8 months 1 day
Patents
Schedule of Intangible Assets
Gross Carrying Value	$ 600	600
Accumulated Amortization	600	600
Net Carrying Value	$ 0	$ 0

Inventories

6 Months Ended

Jun. 29, 2024

Inventory Disclosure [Abstract]

Inventories

5. Inventories

The components of the Company’s inventories as of June 29, 2024 and December 30, 2023 are as follows:


	June 29, 2024		December 30, 2023
Raw materials	$	4,926	$	5,288
Work in process		20		156
Finished goods		6,178		4,462
Total inventories	$	11,124	$	9,906

Business Segments - Revenue Information by Geographic Region (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Revenues From External Customers And Long Lived Assets [Line Items]
Total revenues	$ 12,631	$ 12,855	$ 24,392	$ 26,561
United States
Revenues From External Customers And Long Lived Assets [Line Items]
Total revenues	5,598	6,742	10,919	13,516
Europe, Middle East and Africa
Revenues From External Customers And Long Lived Assets [Line Items]
Total revenues	2,667	2,843	6,365	7,020
Asia/Pacific Rim
Revenues From External Customers And Long Lived Assets [Line Items]
Total revenues	3,597	2,482	6,042	4,625
Americas, excluding the U.S.
Revenues From External Customers And Long Lived Assets [Line Items]
Total revenues	$ 769	$ 788	$ 1,066	$ 1,400

- Definition

+ References

+ Details

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Jun. 29, 2024	Dec. 30, 2023
Current assets:
Cash and cash equivalents	$ 4,111	$ 7,034
Accounts receivable, net	6,269	6,727
Receivable from related party	1,773	2,927
Inventories	11,124	9,906
Prepaid expenses and other current assets	1,730	856
Total current assets	25,007	27,450
Property and equipment, net	209	351
Intangible assets, net	1,475	1,642
Goodwill	965	965
Operating lease right-of-use assets, net	2,172	2,632
Other long-term assets	1,421	1,396
Total assets	31,249	34,436
Current liabilities:
Accounts payable	7,767	4,499
Payable to related party	619	228
Accrued compensation	2,139	1,619
Accrued expenses	868	1,996
Other current liabilities	1,467	1,233
Deferred revenue, current	2,290	2,404
Operating lease liabilities, current	995	995
Total current liabilities	16,145	12,974
Long-term liabilities:
Deferred revenue	9,261	10,025
Operating lease liabilities	1,294	1,751
Other long-term liabilities	303	164
Total liabilities	27,003	24,914
Commitments and contingencies (Note 8)
Stockholders’ equity:
Preferred stock, $0.01 par value, 2,000,000 shares authorized, no shares issued and outstanding	0	0
Issued and outstanding 16,449,283 shares as of June 29, 2024 and 16,252,813 as of December 30, 2023	172	172
Additional paid-in capital	89,257	88,444
Accumulated other comprehensive income (loss)	2	(52)
Accumulated deficit	(85,185)	(79,042)
Total stockholders’ equity	4,246	9,522
Total liabilities and stockholders’ equity	$ 31,249	$ 34,436

Goodwill and Intangible Assets

6 Months Ended

Jun. 29, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

6. Goodwill and Intangible Assets

Goodwill

The carrying value of goodwill was $1.0 million as of both June 29, 2024 and December 30, 2023.

Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. The Company reviews goodwill for impairment on an annual basis or whenever events or changes in circumstances indicate the carrying value may not be recoverable. The Company performs an annual impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax-deductible goodwill carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The Company has determined that it has a single reporting unit for purposes of performing its goodwill impairment test. As the Company uses the market approach to assess impairment, its common stock price is an important component of the fair value calculation. If the Company’s stock price continues to experience significant price and volume fluctuations, this will impact the fair value of the reporting unit and can lead to potential impairment in future periods. The Company performed its annual impairment test during the second quarter of fiscal year 2024 and determined that its goodwill was not impaired.

Intangible Assets

The following table summarizes the components of gross and net of intangible assets carrying amounts (in thousands):


	June 29, 2024							December 30, 2023
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Useful Lives Remaining	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Customer relations	$	340	$	274	$	66	3.12 Years	$	340	$	260	$	80
Developed technology		1,899		679		1,220	4.64 Years		1,899		543		1,356
Trade names		300		111		189	5.67 Years		300		94		206
Patents		600		600		—	Varies		600		600		—
	$	3,139	$	1,664	$	1,475		$	3,139	$	1,497	$	1,642

For each of the six months ended June 29, 2024, and July 1, 2023 amortization expense totaled $167 thousand.

The amortization of developed technology was charged to research and development expense and the amortization of customer relations and trade names was charged to sales and marketing expense. Estimated future amortization expense for purchased intangible assets is as follows (in thousands):


Fiscal Year:
Remainder of 2024 (six months)	$	168
2025		323
2026		319
2027		319
2028		200
Thereafter		146
Total	$	1,475

Income Taxes - Additional Information (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023	Dec. 30, 2023
Income Taxes [Line Items]
Provision for income taxes	$ 19,000	$ 10,000	$ 57,000	$ 22,000
Unrecognized tax benefits					$ 1,400,000
Unrecognized tax benefits recognition impact on income tax rate					$ 0
Federal
Income Taxes [Line Items]
Income tax returns examination period			3 years
Minimum
Income Taxes [Line Items]
Income tax returns examination period			3 years
Maximum \| State Jurisdictions
Income Taxes [Line Items]
Income tax returns examination period			5 years

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References

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-Topic 270
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-Name Accounting Standards Codification
-Section 50
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-Subparagraph (SAB Topic 6.I.7)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-8

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-10

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 944
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(9))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477250/944-220-S99-1

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Section 45
-Paragraph 2
-Subparagraph (a)
-SubTopic 20
-Topic 740
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482659/740-20-45-2

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h))
-SubTopic 10
-Topic 235
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

+ Details

Computation of Basic and Diluted Net Loss Per Share - Additional Information (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 29, 2024	Jul. 01, 2023	Jun. 29, 2024	Jul. 01, 2023
Stock options and RSUs
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Shares that were excluded from the computation of diluted weighted average shares outstanding	2,856,244	2,260,886	2,878,936	2,281,161

Accounts Receivable and Provision for Credit Losses

6 Months Ended

Jun. 29, 2024

Allowance for Credit Loss [Abstract]

Accounts Receivable and Provision for Credit Losses

3. Accounts Receivable and Provision for Credit Losses

The Company has trade receivables with various individual customers such as private businesses, hospitals, universities, government and non-profit entities, and distributors. The Company has determined that geography is the similar risk characteristic to pool our trade receivables balances, and accordingly, groups such balances into either the domestic pool or the international pool. The domestic pool is primarily comprised of individual customers, and the international pool is primarily comprised of distributors.

The provision for credit losses represents an estimate of the lifetime expected credit losses inherent in trade receivables as of the consolidated balance sheet date. We assess the adequacy of the provision for credit losses on a quarterly basis based on historical information and current economic conditions and forecasts. Subsequent changes in the provision for credit losses are recorded in current earnings and reversal of previous losses are permitted under the current guidance.

While we believe we have exercised prudent judgment and applied reasonable assumptions, there can be no assurance that in the future, changes in economic conditions or other factors would not cause changes in the financial health of our customers. If the financial health of our customers deteriorates, the timing and level of payments received could be impacted and therefore, could result in a change to our estimated losses.

The following table presents the activity in the provision for credit losses for accounts receivable by pool type for the six months ended June 29, 2024 (in thousands):


	Domestic			International			Total
Balance, beginning of period	$	(94	)	$	(52	)	$	(146	)
Change to provision		16			18			34
Balance, end of period	$	(78	)	$	(34	)	$	(112	)

Leases and Commitments and Contingencies

6 Months Ended

Jun. 29, 2024

Commitments and Contingencies Disclosure [Abstract]

Leases and Commitments and Contingencies

8. Leases and Commitments and Contingencies

Operating Leases

Our operating leases consist of facility and office equipment leases. Operating lease expenses for each of the six months ended June 29, 2024 and July 1, 2023 was $0.5 million. The weighted average discount rate used in calculating the present value of lease payments was 4.8%. As of June 29, 2024, the weighted average remaining lease term for our operating leases was 2.2 years.

The following represents maturities of operating lease liabilities as of June 29, 2024 (in thousands):


Fiscal Year	Operating Lease Payments
Remainder of 2024 (six months)	$	558
2025		1,111
2026		762
Total lease payments		2,431
Less: Imputed interest		(142	)
Total lease liabilities		2,289
Non-current portion of lease liabilities		(1,294	)
Current portion of lease liabilities	$	995

Purchase Commitments

Our purchase commitments consist primarily of non-cancellable purchase commitments with vendors to manufacture certain components and ophthalmic instrumentation. As of June 29, 2024, our future minimum payments through fiscal year 2025 for our purchase commitments were approximately $14.1 million, with $8.1 million committed for the next 12 months.

Indemnities

We enter into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, we indemnify, hold harmless, and agree to reimburse the indemnified parties for losses suffered or incurred by the indemnified parties (generally our business partners or customers) in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to our products. The term of these indemnification agreements is generally perpetual any time after the execution of the agreement. The maximum potential amount of future payments that we could be required to make under these agreements is not determinable. We have never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, we believe the estimated fair value of these agreements is minimal.

We have entered into indemnification agreements with our directors and officers that may require us to indemnify our directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of a culpable nature. These agreements also require us to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified and to make good faith determination whether or not it is practicable for us to obtain directors and officers insurance. We currently have directors and officers liability insurance.

Legal Proceedings

From time to time, we may be involved in legal proceedings arising in the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business, condensed consolidated operating results, financial condition or cash flows. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.