0001667011-22-000027 | 10-Q | XBRL Viewer

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Cover - shares	6 Months Ended
Cover - shares	Jun. 30, 2022	Aug. 02, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2022
Document Transition Report	false
Entity File Number	001-40960
Entity Registrant Name	Arteris, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	27-0117058
Entity Address, Address Line One	595 Millich Dr.
Entity Address, Address Line Two	Suite 200
Entity Address, City or Town	Campbell
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95008
City Area Code	408
Local Phone Number	470-7300
Title of 12(b) Security	Common stock, $0.001 par value
Trading Symbol	AIP
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		32,683,706
Entity Central Index Key	0001667011
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Amendment Flag	false
Current Fiscal Year End Date	--12-31

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Current assets:
Cash	$ 81,301	$ 85,825
Accounts receivable, net	4,705	13,873
Prepaid expenses and other current assets	8,862	6,949
Total current assets	94,868	106,647
Property and equipment, net	3,017	2,438
Equity method investment	12,169	0
Operating lease right-of-use assets	2,361	2,765
Intangibles, net	2,721	2,959
Goodwill	2,677	2,677
Other assets	3,339	2,957
TOTAL ASSETS	121,152	120,443
Current liabilities:
Accounts payable	1,567	1,722
Accrued expenses and other current liabilities	10,758	10,573
Operating lease liabilities, current	1,027	961
Deferred revenue, current	28,104	28,403
Vendor financing arrangements, current	1,077	833
Total current liabilities	42,533	42,492
Deferred revenue, noncurrent	19,681	20,773
Operating lease liabilities, noncurrent	1,394	1,851
Vendor financing arrangements, noncurrent	239	266
Deferred income, noncurrent	10,444	0
Other liabilities	1,151	2,157
Total liabilities	75,442	67,539
Commitments and contingencies (Note 9)
Stockholders' equity:
Preferred stock, par value of $0.001 - 10,000,000 shares authorized and no shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively	0	0
Common stock, par value of $0.001 - 300,000,000 shares authorized as of June 30, 2022 and December 31, 2021; 32,622,817 and 31,530,682 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively	33	31
Additional paid-in capital	97,237	91,945
Accumulated other comprehensive loss	(81)	(81)
Accumulated deficit	(51,479)	(38,991)
Total stockholders' equity	45,710	52,904
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$ 121,152	$ 120,443

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2022	Dec. 31, 2021
Stockholders' equity:
Preferred stock, par or stated value per share (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares outstanding (in shares)	0	0
Preferred stock, shares issued (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized (in shares)	300,000,000
Common stock, issued (in shares)	32,622,817	31,530,682
Common stock, outstanding (in shares)	32,622,817	31,530,682

Condensed Consolidated Statements of Loss and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Revenue
Total revenue	$ 14,822	$ 10,813	$ 26,577	$ 17,471
Cost of revenue	1,289	867	2,268	1,735
Gross profit	13,533	9,946	24,309	15,736
Operating expenses:
Research and development	10,371	6,425	19,827	12,963
Sales and marketing	4,456	2,281	8,377	4,729
General and administrative	4,132	4,761	8,147	8,012
Total operating expenses	18,959	13,467	36,351	25,704
Loss from operations	(5,426)	(3,521)	(12,042)	(9,968)
Interest and other income (expense), net	109	(200)	28	(314)
Loss before provision for income taxes	(5,317)	(3,721)	(12,014)	(10,282)
Provision for income taxes	351	188	474	344
Net loss and comprehensive loss	(5,668)	(3,909)	(12,488)	(10,626)
Net loss and comprehensive loss	$ (5,668)	$ (3,909)	$ (12,488)	$ (10,626)
Net loss per share attributable to common stockholders
Net loss per share attributable to common stockholders, basic (in dollars per share)	$ (0.18)	$ (0.20)	$ (0.39)	$ (0.55)
Net loss per share attributable to common stockholders, diluted (in dollars per share)	$ (0.18)	$ (0.20)	$ (0.39)	$ (0.55)
Weighted average shares used in computing per share amounts
Weighted average shares used in computing per share amounts, basic (in shares)	32,258,228	19,874,925	31,940,293	19,354,965
Weighted average shares used in computing per share amounts, diluted (in shares)	32,258,228	19,874,925	31,940,293	19,354,965
Licensing, support and maintenance
Revenue
Total revenue	$ 14,033	$ 10,056	$ 24,608	$ 16,217
Variable royalties and other
Revenue
Total revenue	$ 789	$ 757	$ 1,969	$ 1,254

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit
Balance at beginning of period (in shares) at Dec. 31, 2020	4,471,316
Balance at beginning of period at Dec. 31, 2020	$ 5,712
Balance at end of period (in shares) at Jun. 30, 2021	4,471,316
Balance at end of period at Jun. 30, 2021	$ 5,712
Balance at beginning of period (in shares) at Dec. 31, 2020		18,486,989
Balance at beginning of period at Dec. 31, 2020	(12,008)	$ 18	$ 3,612	$ (31)	$ (15,607)
Stockholders’ Equity
Stock issued during period (in shares)		1,250,000
Stock Issued During Period, Value, New Issues	5,436	$ 1	5,435
Issuance of common stock for cash upon exercise of stock options (in shares)		771,934
Issuance of common stock for cash upon exercise of stock options	298	$ 2	296
Issuance of common stock for settlement of restricted stock units (in shares)		16,331
Stock-based compensation expense	711		711
Net loss	(10,626)				(10,626)
Balance at end of period (in shares) at Jun. 30, 2021		20,525,254
Balance at end of period at Jun. 30, 2021	$ (16,189)	$ 21	10,054	(31)	(26,233)
Balance at beginning of period (in shares) at Mar. 31, 2021	4,471,316
Balance at beginning of period at Mar. 31, 2021	$ 5,712
Balance at end of period (in shares) at Jun. 30, 2021	4,471,316
Balance at end of period at Jun. 30, 2021	$ 5,712
Balance at beginning of period (in shares) at Mar. 31, 2021		19,031,216
Balance at beginning of period at Mar. 31, 2021	(18,207)	$ 19	4,129	(31)	(22,324)
Stockholders’ Equity
Stock issued during period (in shares)		1,250,000
Stock Issued During Period, Value, New Issues	5,437	$ 2	5,435
Issuance of common stock for cash upon exercise of stock options (in shares)		227,707
Issuance of common stock for cash upon exercise of stock options	112		112
Issuance of common stock for settlement of restricted stock units (in shares)		16,331
Stock-based compensation expense	378		378
Net loss	(3,909)				(3,909)
Balance at end of period (in shares) at Jun. 30, 2021		20,525,254
Balance at end of period at Jun. 30, 2021	$ (16,189)	$ 21	10,054	(31)	(26,233)
Balance at beginning of period (in shares) at Dec. 31, 2021	0
Balance at beginning of period at Dec. 31, 2021	$ 0
Balance at end of period (in shares) at Jun. 30, 2022	0
Balance at end of period at Jun. 30, 2022	$ 0
Balance at beginning of period (in shares) at Dec. 31, 2021	31,530,682	31,530,682
Balance at beginning of period at Dec. 31, 2021	$ 52,904	$ 31	91,945	(81)	(38,991)
Stockholders’ Equity
Issuance of common stock for cash upon exercise of stock options (in shares)	766,942	766,942
Issuance of common stock for cash upon exercise of stock options	$ 444	$ 2	442
Issuance of common stock for settlement of restricted stock units (in shares)		394,436
Tax withholding on RSUs settlement (in shares)		(69,243)
Tax withholding on RSUs settlement	(843)		(843)
Stock-based compensation expense	5,693		5,693
Net loss	$ (12,488)				(12,488)
Balance at end of period (in shares) at Jun. 30, 2022	32,622,817	32,622,817
Balance at end of period at Jun. 30, 2022	$ 45,710	$ 33	97,237	(81)	(51,479)
Balance at beginning of period (in shares) at Mar. 31, 2022	0
Balance at beginning of period at Mar. 31, 2022	$ 0
Balance at end of period (in shares) at Jun. 30, 2022	0
Balance at end of period at Jun. 30, 2022	$ 0
Balance at beginning of period (in shares) at Mar. 31, 2022		31,858,420
Balance at beginning of period at Mar. 31, 2022	47,659	$ 31	93,520	(81)	(45,811)
Stockholders’ Equity
Issuance of common stock for cash upon exercise of stock options (in shares)		641,932
Issuance of common stock for cash upon exercise of stock options	354	$ 2	352
Issuance of common stock for settlement of restricted stock units (in shares)		127,743
Tax withholding on RSUs settlement (in shares)		(5,278)
Tax withholding on RSUs settlement	(19)		(19)
Stock-based compensation expense	3,384		3,384
Net loss	$ (5,668)				(5,668)
Balance at end of period (in shares) at Jun. 30, 2022	32,622,817	32,622,817
Balance at end of period at Jun. 30, 2022	$ 45,710	$ 33	$ 97,237	$ (81)	$ (51,479)

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (12,488)	$ (10,626)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	929	733
Stock-based compensation	5,693	711
Operating non-cash lease expense	13	(31)
Other, net	(1)	(8)
Gain on deconsolidation of subsidiary (Note 12)	(149)	0
Changes in operating assets and liabilities:
Accounts receivable, net	9,168	5,932
Prepaid expenses and other assets	(2,232)	(2,872)
Accounts payable	(1)	973
Accrued expenses and other liabilities	(704)	(34)
Deferred revenue	(1,391)	3,716
Net cash used in operating activities	(1,163)	(1,506)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(205)	(359)
Payments relating to investment in equity method investment (Note 12)	(520)	0
Net cash used in investing activities	(725)	(359)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of contingent consideration for business acquisition	(1,573)	0
Proceeds from issuance of common stock	0	5,435
Principal payments under vendor financing arrangements	(407)	(325)
Proceeds from exercise of stock options	443	298
Payments to tax authorities for shares withheld from employees	(843)	0
Payments of deferred offering costs	(256)	(178)
Payments of principal portion of term loan	0	(300)
Net cash (used in) provided by financing activities	(2,636)	4,930
NET (DECREASE) INCREASE IN CASH	(4,524)	3,065
CASH, beginning of period	85,825	11,744
CASH, end of period	81,301	14,809
Noncash investing and financing activities:
Purchase of property and equipment through vendor financing and accrued expenses and other current liabilities	962	121
Unpaid deferred offering costs	0	1,447
Operating lease right-of-use assets exchanged for lease liabilities	63	327
Equity obtained in equity method investment in exchange for contribution of license agreement (Note 12)	$ 11,563	$ 0

DESCRIPTION OF BUSINESS	6 Months Ended
DESCRIPTION OF BUSINESS	Jun. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS	DESCRIPTION OF BUSINESS Description of the Business Arteris, Inc. and its subsidiaries (collectively, the “Company” or “Arteris”) was incorporated in Delaware on April 12, 2004. The Company develops, licenses, and supports the on-chip interconnect fabric technology used in System-on-Chip (SoC) designs for a variety of devices and in the development and distribution of Network-on-Chip (NoC) interconnect intellectual property (IP). The Company also provides software and services to enable efficient deployment of NoC IP, IP support & maintenance services, professional services and training and on-site support services. The Company is headquartered in Campbell, California and has offices in the United States, France, Japan, South Korea and China. In October, 2021, the Company completed its initial public offering (IPO), in which it issued and sold 5,750,000 shares of its common stock at the public offering price of $14.00 per share, including 750,000 shares of its common stock upon the full exercise of the underwriters’ option to purchase additional shares. The Company received net proceeds of $71.1 million after deducting underwriting discounts and commissions and offering expenses. Deferred offering costs for the IPO were $3.8 million and consisted primarily of direct incremental accounting, legal and other fees related to the IPO. Prior to the IPO, all deferred offering costs were capitalized and included in other assets, non-current on the condensed consolidated balance sheets. Upon completion of the IPO, deferred offering costs were reclassified into stockholders’ equity (deficit) as a reduction of the IPO proceeds. COVID-19 Pandemic While the duration and extent of the COVID-19 pandemic depends on future developments that cannot be accurately predicted at this time, such as the extent and effectiveness of containment actions and emergence of new variants, it has already had an adverse effect on the global economy and the lasting effects of the pandemic continue to be unknown. In response to the COVID-19 pandemic, the measures implemented by various authorities have caused us to change the Company’s business practices, including those related to where employees work, the distance between employees in the Company’s facilities, limitations on in-person meetings between employees and with customers, suppliers, service providers and stakeholders, as well as restrictions on business travel to domestic and international locations and to attend trade shows, technical conferences and other events. The Company is unable to accurately predict the full impact that COVID-19 will have on its future results of operations, financial condition, liquidity and cash flows due to numerous uncertainties, including the duration and severity of the pandemic and containment measures. The Company will continue to monitor health orders issued by applicable governments to ensure compliance with evolving domestic and global COVID-19 guidelines.

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2022

Accounting Policies [Abstract]

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2021 and the related notes included in the Company’s Form 10-K filed on March 7, 2022 (2021 Form 10-K) with the U.S. Securities and Exchange Commission (SEC). The December 31, 2021 condensed consolidated balance sheet was derived from the audited consolidated financial statements as of that date. In management’s opinion, the unaudited interim consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the condensed consolidated financial statements.

The operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year or any other future interim or annual period.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Arteris, Inc. and its wholly-owned subsidiaries. All inter-company transactions and accounts have been eliminated.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates relate to, among others, revenue recognition, the useful lives of assets, assessment of recoverability of property, plant and equipment, fair values of goodwill and other intangible assets, including impairments, leases, allowances for doubtful accounts, deferred tax assets and related valuation allowance, stock-based compensation, potential reserves relating to litigation and tax matters, collectability of certain receivables, fair value and amortization of deferred income, as well as other accruals or reserves. Actual results could differ from those estimates and such differences may be material to the condensed consolidated financial statements.

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentration of credit risk consist of cash and accounts receivable. The Company maintains cash in checking and savings deposits. All of the Company’s net IPO proceeds are held within a single financial institution as of June 30, 2022. Management believes no significant concentration risk exists with respect to cash as in management’s judgment the banks that hold the Company’s cash are financially stable. The Company deposits cash with high-credit-quality financial institutions which, at times, may exceed federally insured amounts.

The Company’s accounts receivable are derived principally from revenue earned from customers located in Americas, Europe, Middle East and Asia Pacific regions.

Accounts receivable from the Company’s major customers representing 10% or more of total accounts receivable was as follows:


	As of
	June 30, 2022		December 31, 2021
Customer A	18	%	*
Customer B	15	%	*
Customer C	12	%	*
Customer D	*		33	%
Customer E	*		21	%
Customer F	*		12	%

*Customer accounted for less than 10% of total accounts receivable at period end.

Revenue from the Company’s major customers representing 10% or more of total revenue was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Customer D	32	%	26	%	26	%	21	%
Customer E	*		10	%	*		*
Customer F	*		*		11	%	*

*Customer accounted for less than 10% of total revenue in the period.

Significant Accounting Policies

There have been no significant changes to the Company’s significant accounting policies during the six months ended June 30, 2022 from those disclosed in the annual consolidated financial statements for the year ended December 31, 2021, except for those disclosed in this document.

Equity Method Investments

The Company uses the equity method to account for its investments in companies which the Company does not control but is deemed to have the ability to exercise significant influence over operating and financial decisions of the investee.

The Company generally measures an investment in the common stock of an investee initially at cost. The carrying value of the Company’s equity method investments is reported in equity method investment on the condensed consolidated balance sheets. The Company records its proportionate share of the income or loss in its equity method investments on a one-quarter lag. The cost is adjusted to recognize the Company's proportionate share of the investee’s net income or loss after the date of investment. The Company assesses investments for impairment whenever events or changes in circumstances indicate that the carrying value of an investment may not be recoverable.

Distributions received from an investee reduce the carrying value of an investment and are recorded in the consolidated statements of cash flows using the nature of distribution approach.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and in May 2019 issued ASU No. 2019-05, Credit Losses (Topic 326): Targeted Transition Relief (collectively referred to as Topic 326), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. Topic 326 replaces the existing incurred loss impairment model with a forward-looking expected credit loss model which will result in earlier recognition of credit losses. Topic 326 is effective for the Company for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements and related disclosures.

In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This standard requires contract assets and contract liabilities acquired in a business combination to be recognized in accordance with Topic 606 as if the acquirer had originated the contracts. The guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those years and early adoption is permitted. The Company is currently evaluating the impact that the standard will have on its consolidated financial statements and related disclosures.

REVENUE

6 Months Ended

Jun. 30, 2022

Revenue from Contract with Customer [Abstract]

REVENUE

Disaggregated Revenue

The following table shows revenue by product and services groups (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Licensing, support and maintenance	$	14,033	$	10,056	$	24,608	$	16,217
Variable royalties	587		684		1,571		1,174
Other	202		73		398		80
Total	$	14,822	$	10,813	$	26,577	$	17,471

Contract Balances

The following table provides information about accounts receivable, net, contract assets and deferred revenue (in thousands):


	As of
	June 30, 2022		December 31, 2021
Accounts receivable, net	$	4,705	$	13,873
Contract assets	$	1,877	$	1,486
Deferred revenue	$	47,785	$	49,176

The Company recognized revenue of $8.1 million and $5.6 million for the three months ended June 30, 2022 and 2021, respectively, and $14.7 million and $9.3 million for the six months ended June 30, 2022 and 2021, respectively, that was included in the deferred revenue balance at the beginning of the respective periods.

Contracted but unsatisfied performance obligations were $47.9 million and $49.3 million as of June 30, 2022 and December 31, 2021, respectively, and included unearned revenue and non-cancelable Flexible Spending Account (FSA) Agreements from customers where actual product selection and quantities of specific products are to be determined by customers at a future period. FSA commitments amounted to $0.2 million and $0.2 million as of June 30, 2022 and December 31, 2021, respectively. The Company has elected to exclude the potential future royalty receipts from the remaining performance obligations. The contracted but unsatisfied or partially unsatisfied performance obligations, excluding non-cancelable FSA, expected to be recognized in revenue over the next 12 months as of June 30, 2022 are $25.1 million, with the remainder recognized thereafter.

Costs of Obtaining a Contract with a Customer

Incremental costs of obtaining a contract with a customer consist primarily of direct sales commissions incurred upon execution of the contract. These costs are required to be capitalized under ASC 340-40, Other Assets and Deferred Costs — Contracts With Customers, and amortized over the license term. As direct sales commissions paid for term extensions are commensurate with the amounts paid for initial contracts, the deferred incremental costs for initial contracts and for term extensions are recognized over the respective contract terms. Total capitalized direct commission costs were as follows (in thousands):


	As of
	June 30, 2022		December 31, 2021
Short-term commissions capitalized in prepaid expenses and other current assets	$	2,396	$	2,289
Long-term commissions capitalized in other assets	1,746		1,719
Total	$	4,142	$	4,008

Amortization of capitalized sales commissions was $0.9 million and $0.3 million for the three months ended June 30, 2022 and 2021, respectively, and $1.6 million and $0.7 million for the six months ended June 30, 2022 and 2021, respectively.

Amortization of capitalized sales commissions are included in sales and marketing expense in the condensed consolidated statements of loss and comprehensive loss.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

+ Details

NET LOSS PER SHARE

6 Months Ended

Jun. 30, 2022

Earnings Per Share [Abstract]

NET LOSS PER SHARE

The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator:
Net loss	$	(5,668)	$	(3,909)	$	(12,488)	$	(10,626)
Denominator:
Weighted-average shares outstanding - basic and diluted	32,258,228		19,874,925		31,940,293		19,354,965
Net loss per share, basic and diluted	$	(0.18)	$	(0.20)	$	(0.39)	$	(0.55)

Since the Company was in a loss position for all periods presented, the diluted earnings per share is equal to the basic earnings per share as the effect of potentially dilutive securities would have been antidilutive.

The following table summarizes the potentially dilutive securities that were excluded from the calculation of diluted earnings per share because they would be antidilutive:


	As of
	June 30, 2022	June 30, 2021
Stock options	4,355,694	6,201,315
Restricted stock units	5,220,177	2,887,064
Redeemable convertible preferred stock	—	4,471,316
Total	9,575,871	13,559,695

FAIR VALUE MEASUREMENTS	6 Months Ended
FAIR VALUE MEASUREMENTS	Jun. 30, 2022
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	FAIR VALUE MEASUREMENTS Assets Measured and Recorded at Fair Value on a Non-Recurring Basis Equity method investments, and certain non-financial assets, such as intangible assets and property, plant and equipment, are remeasured at fair value only if an impairment or observable price adjustment is recognized in the current period. Financial Instruments Not Recorded at Fair Value on a Recurring Basis Financial instruments not recorded at fair value on a recurring basis include vendor financing arrangements. The carrying value of the vendor financing agreements were $1.3 million and $1.1 million as of June 30, 2022 and December 31, 2021, respectively. The Company’s vendor financing arrangements are classified within Level 2 because these borrowings are not actively traded and have a variable interest rate structure based upon market rates currently available to the Company for debt with similar terms and maturities. The estimated fair values of these financial instruments approximate their carrying values.

- 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.

+ References + Details

INTANGIBLE ASSETS AND GOODWILL

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS AND GOODWILL

Intangible assets, net

Intangible assets, net consisted of the following as of June 30, 2022 (in thousands):


	Gross Fair Value		Accumulated Amortization		Net Book Value
Developed technology	$	1,700	$	(538)	$	1,162
Customer relationships	1,100		(218)		882
IPR&D	500		—		500
Trade name and other	177		—		177
Total intangibles	$	3,477	$	(756)	$	2,721

Intangible assets, net consisted of the following as of December 31, 2021 (in thousands):


	Gross Fair Value		Accumulated Amortization		Net Book Value
Developed technology	$	1,700	$	(368)	$	1,332
Customer relationships	1,100		(149)		951
IPR&D	500		—		500
Trade name and other	176		—		176
Total intangibles	$	3,476	$	(517)	$	2,959

Amortization expense of intangible assets was $0.1 million for both the three months ended June 30, 2022 and 2021, and $0.2 million for both the six months ended June 30, 2022 and 2021.

The expected future amortization expense of these intangible assets as of June 30, 2022 is as follows (in thousands):


Fiscal year ending December 31,	Amount
Remainder of 2022	$	239
2023	478
2024	478
2025	449
2026	138
Thereafter	262
Total future amortization expense	$	2,044

Goodwill

As of June 30, 2022 and December 31, 2021, goodwill was $2.7 million. No goodwill impairments were recorded during the three and six months ended June 30, 2022 and 2021.

LEASES

6 Months Ended

Jun. 30, 2022

Leases [Abstract]

LEASES

LEASESThe Company leases its offices at various locations under noncancelable operating lease agreements expiring at various dates through 2027. Under the terms of these agreements, the Company also bears the costs for certain insurance, property tax, and maintenance. The terms of certain lease agreements provide for increasing rental payments at fixed intervals.

Total operating lease related costs were as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Operating lease cost	$	266	$	238	$	539	$	474
Short-term lease cost	92		36		225		52
Total lease cost	$	358	$	274	$	764	$	526

The weighted-average remaining term of the Company’s operating leases was 3.3 years and 3.6 years as of June 30, 2022 and December 31, 2021, respectively, and the weighted-average discount rate used to measure the present value of the operating lease liabilities was 7.5% as of both June 30, 2022 and December 31, 2021.

Maturities of operating lease liabilities as of June 30, 2022 were as follows (in thousands):


Fiscal year ending December 31,	Amount
Remainder of 2022	$	593
2023	990
2024	449
2025	278
2026	212
Thereafter	212
Total undiscounted cash flows	$	2,734
Less: imputed interest	(313)
Present value of lease liabilities	$	2,421

Operating lease liabilities, current	$	1,027
Operating lease liabilities, non-current	1,394
	$	2,421

BORROWINGS

6 Months Ended

Jun. 30, 2022

Debt Disclosure [Abstract]

BORROWINGS

Vendor financing arrangements—The Company has various vendor financing arrangements with extended payment terms on the purchase of software licenses and equipment. In order to determine the present value of the commitments, the Company used an imputed interest rate of 7.5%, which is reflective of its collateralized borrowing rate with similar terms to that of the software licenses and equipment transactions.

Vendor financing arrangements as of June 30, 2022 were as follows (in thousands):


Fiscal year ending December 31,	Amount
Remainder of 2022	$	427
2023	650
2024	331
Total undiscounted cash flows	$	1,408
Less: imputed interest	(92)
Present value of vendor financing arrangements	$	1,316

Vendor financing arrangements, current	$	1,077
Vendor financing arrangements, noncurrent	239
	$	1,316

Interest expense was less than $0.1 million for the three and six months ended June 30, 2022

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
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-Name Accounting Standards Codification
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+ Details

COMMITMENT AND CONTINGENCIES	6 Months Ended
COMMITMENT AND CONTINGENCIES	Jun. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
Commitment and Contingencies	COMMITMENTS AND CONTINGENCIES Indemnifications—The Company often enters into limited indemnification provisions in license agreements in the ordinary course of the Company’s licensing business. Pursuant to these provisions, which are often inserted into license agreements in the semiconductor IP and software licensing industries, the Company agrees to indemnify, hold harmless, and reimburse the indemnified parties up to a capped amount for losses suffered or incurred by such indemnified parties due to third party claims if such claims are determined to be caused by the Company. The term of these indemnification provisions is generally either for a term of years or perpetual, in each case beginning on the execution date of the agreement. The Company has also agreed to indemnify under indemnity agreements with its directors and officers, to the extent legally permissible, against liabilities incurred in connection with any action in which such individual may be involved by reason of such individual being or having been a director or officer, other than certain liabilities arising from willful misconduct of the individual. The Company has incurred no actual payment obligations from these above-noted indemnification provisions and director and officer indemnity agreements for three and six months ended June 30, 2022 and 2021 and the condensed consolidated financial statements do not include liabilities for any potential indemnity-related obligations as of June 30, 2022 and December 31, 2021. Legal—In the normal course of business, the Company may receive inquiries or become involved in legal disputes regarding various litigation matters. Although claims are inherently unpredictable, the Company currently is not aware of any matters that may have a material adverse effect on the Company’s financial position, results of operations, or cash flows. The Company has no other material contractual noncancelable commitments as of June 30, 2022 and December 31, 2021.

REDEEMABLE CONVERTIBLE PREFERRED STOCK, PREFERRED STOCK AND COMMON STOCK	6 Months Ended
	Jun. 30, 2022
Equity [Abstract]
REDEEMABLE CONVERTIBLE PREFERRED STOCK, PREFERRED STOCK AND COMMON STOCK	REDEEMABLE CONVERTIBLE PREFERRED STOCK, PREFERRED STOCK AND COMMON STOCK Redeemable Convertible Preferred Stock Immediately prior to the closing of the IPO, all shares of the Company’s redeemable convertible preferred stock outstanding, totaling 4,471,316, were automatically converted into an equal number of shares of common stock and their carrying value of $5.7 million was reclassified into stockholders’ equity. As of both June 30, 2022 and December 31, 2021, there were zero shares of redeemable convertible preferred stock issued and outstanding. Preferred Stock In connection with the IPO, the Company amended and restated its certificate of incorporation to authorize 10,000,000 shares of preferred stock with a par value of $0.001, which shares of preferred stock are currently undesignated. Common Stock Holders of common stock are entitled to one vote per share and to receive dividends and, upon liquidation or dissolution, are entitled to receive all assets available for distribution to common stockholders. The common stock has no preemptive or other subscription rights and there are no redemption or sinking fund provisions with respect to such shares. Common stock is subordinate to the preferred stock with respect to dividend rights and rights upon liquidation, winding-up, and dissolution of the Company. In connection with the IPO, the Company amended and restated its certificate of incorporation to authorize 300,000,000 shares of common stock.

STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2022

Share-based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

2016 Stock Plan

On October 10, 2016, the Company amended and restated the 2013 Equity Incentive Plan (the 2013 Plan) and changed the name of the plan to Arteris, Inc. 2016 Incentive Plan (the 2016 Plan). Adoption of the 2016 Plan provides for participation by foreign nationals or those employed outside of the United States.

The 2016 Plan provides for the granting of the following types of stock awards: incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards (RSUs) and other stock awards. The number of shares authorized for award was 20,803,838. The Company has granted awards of common stock in the form of 14,142,208 shares as of December 31, 2021. Following the Company’s IPO in October 2021, all future grants will be made under the 2021 Plan (as defined below), with none remaining available for future grant under the 2016 Plan.

2021 Stock Plan

The Company adopted the 2021 Incentive Award Plan (the 2021 Plan) effective October 26, 2021. The 2021 Plan provides for a variety of stock-based compensation awards, including stock options, stock appreciation rights, or SARs, restricted stock awards, restricted stock unit awards, performance bonus awards, performance stock unit awards, dividend equivalents, or other stock or cash based awards.

Following the effectiveness of the 2021 Plan, the Company will not make any further grants under the 2016 Plan. However, the 2016 Plan will continue to govern the terms and conditions of the outstanding awards granted under this plan. Shares of common stock subject to awards granted under the 2016 Plan that are forfeited or lapse unexercised and which following the effective date of the 2021 Plan are not issued under the 2016 Plan will be available for issuance under the 2021 Plan.

2021 Employee stock purchase plan

The Company adopted the 2021 Employee Stock Purchase Plan (the 2021 ESPP) effective on October 26, 2021. The 2021 ESPP will enable eligible employees of the Company to purchase shares of common stock at a discount to fair market value. As of June 30, 2022, there had been no offering period under the ESPP.

Shares Available for Future Grant

Shares available for future grant consisted of the following:


			As of
			June 30, 2022
Shares available for future grant under the 2021 Plan			3,734,035
Shares available for future grant under the 2021 ESPP			922,306

The Company issues new shares upon a share option exercise or release of restricted stock units.

Stock Options

The following table summarizes the stock option activities under the Company’s 2016 Plan:


	Options Outstanding
	Number of Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value ($'000s)

BALANCE—December 31, 2021	5,407,170	$	0.96	7.16	$	108,964
Exercised	(766,942)	$	0.58
Canceled	(284,534)	$	0.94
BALANCE—June 30, 2022	4,355,694	$	1.03	6.71	$	25,889
Options vested and exercisable—June 30, 2022	3,069,682	$	0.86	6.22	$	18,742

The aggregate intrinsic value of the options exercised during the six months ended June 30, 2022 and 2021 was $8.0 million and $1.0 million, respectively. The total grant-date fair value of options vested was $0.2 million and $0.1 million during the six months ended June 30, 2022 and 2021, respectively.

As of June 30, 2022, there was $0.7 million of unamortized stock-based compensation cost related to unvested stock options, which is expected to be recognized over a weighted-average period of 2.1 years.

The Company had no stock option grants during the six months ended June 30, 2022 and 2021.

Restricted Stock Units

The following table summarizes the restricted stock units activities under the Company’s 2016 and 2021 Plans:


	Restricted Stock Units
	Number of Shares	Weighted-Average Grant Date Fair Value

Unvested—December 31, 2021	3,925,097	$	5.60
Granted	1,851,350	$	13.04
Vested	(394,436)	$	5.73
Forfeited	(161,834)	$	12.29
Unvested—June 30, 2022	5,220,177	$	8.02

The total grant-date fair value of restricted stock units vested was $2.6 million and less than $0.1 million during the six months ended June 30, 2022 and 2021, respectively.

As of June 30, 2022, there was $33.8 million of unamortized stock-based compensation cost related to unvested restricted stock units, which is expected to be recognized over a weighted-average period of 3.3 years.

Stock-based Compensation

Stock-based compensation expense is recorded on a departmental basis, based on the classification of the award holder. The following table presents the amount of stock-based compensation related to stock-based awards to employees on the Company’s condensed consolidated statements of loss and comprehensive loss (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Cost of revenue	$	260	$	14	$	356	$	27
Research and development	1,493		221		2,637		420
Sales and marketing	728		25		999		49
General and administrative	903		118		1,701		215
Total stock-based compensation	$	3,384	$	378	$	5,693	$	711

EQUITY METHOD INVESTMENT	6 Months Ended
EQUITY METHOD INVESTMENT	Jun. 30, 2022
Equity Method Investments and Joint Ventures [Abstract]
Equity Method Investment	EQUITY METHOD INVESTMENT On February 21, 2022, Arteris IP (Hong Kong) Ltd. (AHK), a wholly-owned subsidiary of the Company, entered into a Share Purchase and Shareholders Agreement (the SPA) with SME Development (Shaoxing) Venture Fund, LLP, Jiaxing Luojia Chuanzhi Investment Partnership Enterprise (Limited Partnership), Gongqing City Guinie Zhuyu No. 3 Investment Partnership (Limited Partnership) (together, the Investors) and Ningbo Transchip Information Consulting Partnership (Limited Partnership) (Management Co). The transaction closed on June 20, 2022. The Company, the Investors and Management Co, pursuant to the SPA, subscribed to the registered capital of Transchip Technology (Nanjing) Co., Ltd. (Transchip), a formerly wholly-owned subsidiary of the Company. As a result, the registered capital of Transchip increased to $29.4 million. The Company subscribed for the registered capital of approximately $11.9 million, of which $11.6 million of the contribution was contributed in-kind by way of an interconnect solutions technology license by the Company pursuant to a five-year technology license and services agreement which can be extended automatically for another five-year term, and the remaining was paid in cash. The license agreement provides Transchip the right to software licenses, services, software updates and technical support. On the closing date, the license agreement including the support and maintenance services to be provided to Transchip was valued to be $11.6 million, which was recorded as deferred income and will be recognized as interest and other income (expense), net over a period of ten years on a straight line basis after delivery of the license. Deconsolidation of Transchip as a subsidiary Before closing of the transaction, Transchip was a wholly-owned subsidiary of the Company with limited operations. Upon closing of the transaction, the Company no longer has control, and therefore deconsolidated Transchip. Accordingly, the Company derecognized all the assets and liabilities of Transchip and recognized a disposal gain of $0.1 million, included in interest and other income (expense), net in the condensed consolidated statements of loss and comprehensive loss, for the six months ended June 30, 2022. Upon deconsolidation, the Company also recorded a nine-month related party loan to Transchip of $0.3 million, in prepaid expenses and other current assets within its condensed consolidated balance sheet, which was previously eliminated as an intercompany loan in the Company’s consolidated financial statements. This loan carries an annual interest rate of 4% and will expire on August 31, 2022. Initial investment of Transchip as an equity investee Following the consummation of the foregoing transactions, the Company held 40.3% common stock of Transchip on a fully diluted basis. The Company accounts for its common stock investment in Transchip as an equity method investment as it no longer controls but has significant influence over operating and financing policies of Transchip. The Company recorded its initial equity investment in Transchip at $12.2 million, including transaction costs of $0.3 million. As of June 30, 2022, the carrying value of the investment in Transchip was $12.2 million. There was no significant difference between the Company’s carrying value of the investment in Transchip and its share of underlying equity in net assets of Transchip. During the six months ended June 30, 2022, the Company recorded no income or loss from its proportionate share of its equity method investment in Transchip. The Company concluded that there were no indicators of impairment related to the Company’s equity method investment in Transchip as of June 30, 2022.

INCOME TAXES	6 Months Ended
INCOME TAXES	Jun. 30, 2022
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES The Company’s effective tax rate was (4.1)% and (3.2)% for the six months ended June 30, 2022 and 2021, respectively. The Company’s income tax provision was $0.5 million and $0.3 million for the six months ended June 30, 2022 and 2021, respectively. The change in forecasted foreign withholding tax, changes in the geographic mix of worldwide earnings which are taxed at different rates, and the impact of losses in jurisdictions with full valuation allowances, has resulted in an insignificant change in the income tax provision for the period ended June 30, 2022 compared to the period ended June 30, 2021. The Company’s management continuously evaluates the need for a valuation allowance and, as of June 30, 2022, concluded that a full valuation allowance on its US federal, state, and certain foreign jurisdictions deferred tax assets was still appropriate. As of June 30, 2022 and 2021, the Company’s gross liability for unrecognized tax benefits was $3.1 million and $2.5 million, respectively. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. As of June 30, 2022 and 2021, the Company had no accrued interest or penalties related to its unrecognized tax benefits. If any unrecognized tax benefits are realized, it would not result in any income tax benefit as the Company currently has a full valuation allowance against the deferred tax assets in which there is currently an uncertain tax benefit.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

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+ Details

RELATED PARTY TRANSACTIONS	6 Months Ended
RELATED PARTY TRANSACTIONS	Jun. 30, 2022
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS The Company defines related parties as directors, executive officers, nominees for director, stockholders that have significant influence over the Company, or are a greater than 10% beneficial owner of the Company’s capital and their affiliates or immediate family members. In November 2020, the Company entered into a lease agreement with Isabelle Geday, a member of the Board of Directors. The lease payments were less than $0.1 million for both the three months ended June 30, 2022 and 2021 and $0.1 million for both the six months ended June 30, 2022 and 2021. In addition, the Company signed a consulting agreement with Ms. Geday on December 1, 2021, which was subsequently assigned to Magillem Design Services S.A., effective January 10, 2022. Prior to signing the consulting agreement, Ms. Geday was paid as an executive employee of the Company from December 1, 2020 through November 30, 2021. As a consultant, Ms. Geday will provide services for an initial three-year term and is eligible to receive $26,445 per month for the first 12 months of the consulting term and $19,445 per month for the remaining 24 months of the consulting term. For the three months ended June 30, 2022, the Company paid Ms. Geday $0.1 million for consulting services. For the six months ended June 30, 2022, the Company paid Ms. Geday $0.2 million for consulting services. Lastly, the 455,000 stock options and 62,200 RSUs granted in connection with Ms. Geday’s prior employment continue to vest. In connection with the deconsolidation of Transchip, the Company recorded a short-term loan to Transchip, including interest, of $0.3 million in prepaid expenses and other current assets on its condensed consolidated balance sheet as of June 30, 2022.

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2022
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2021 and the related notes included in the Company’s Form 10-K filed on March 7, 2022 (2021 Form 10-K) with the U.S. Securities and Exchange Commission (SEC). The December 31, 2021 condensed consolidated balance sheet was derived from the audited consolidated financial statements as of that date. In management’s opinion, the unaudited interim consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the condensed consolidated financial statements. The operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year or any other future interim or annual period.
Principles of Consolidation	Principles of Consolidation The condensed consolidated financial statements include the accounts of Arteris, Inc. and its wholly-owned subsidiaries. All inter-company transactions and accounts have been eliminated.
Use of Estimates	Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates relate to, among others, revenue recognition, the useful lives of assets, assessment of recoverability of property, plant and equipment, fair values of goodwill and other intangible assets, including impairments, leases, allowances for doubtful accounts, deferred tax assets and related valuation allowance, stock-based compensation, potential reserves relating to litigation and tax matters, collectability of certain receivables, fair value and amortization of deferred income, as well as other accruals or reserves. Actual results could differ from those estimates and such differences may be material to the condensed consolidated financial statements.
Concentrations of Credit Risk	Concentrations of Credit Risk Financial instruments that potentially subject us to concentration of credit risk consist of cash and accounts receivable. The Company maintains cash in checking and savings deposits. All of the Company’s net IPO proceeds are held within a single financial institution as of June 30, 2022. Management believes no significant concentration risk exists with respect to cash as in management’s judgment the banks that hold the Company’s cash are financially stable. The Company deposits cash with high-credit-quality financial institutions which, at times, may exceed federally insured amounts. The Company’s accounts receivable are derived principally from revenue earned from customers located in Americas, Europe, Middle East and Asia Pacific regions.
Equity Method Investments	Equity Method Investments The Company uses the equity method to account for its investments in companies which the Company does not control but is deemed to have the ability to exercise significant influence over operating and financial decisions of the investee. The Company generally measures an investment in the common stock of an investee initially at cost. The carrying value of the Company’s equity method investments is reported in equity method investment on the condensed consolidated balance sheets. The Company records its proportionate share of the income or loss in its equity method investments on a one-quarter lag. The cost is adjusted to recognize the Company's proportionate share of the investee’s net income or loss after the date of investment. The Company assesses investments for impairment whenever events or changes in circumstances indicate that the carrying value of an investment may not be recoverable. Distributions received from an investee reduce the carrying value of an investment and are recorded in the consolidated statements of cash flows using the nature of distribution approach.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and in May 2019 issued ASU No. 2019-05, Credit Losses (Topic 326): Targeted Transition Relief (collectively referred to as Topic 326), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. Topic 326 replaces the existing incurred loss impairment model with a forward-looking expected credit loss model which will result in earlier recognition of credit losses. Topic 326 is effective for the Company for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements and related disclosures. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This standard requires contract assets and contract liabilities acquired in a business combination to be recognized in accordance with Topic 606 as if the acquirer had originated the contracts. The guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those years and early adoption is permitted. The Company is currently evaluating the impact that the standard will have on its consolidated financial statements and related disclosures.
Fair Value Measurements	Assets Measured and Recorded at Fair Value on a Non-Recurring Basis Equity method investments, and certain non-financial assets, such as intangible assets and property, plant and equipment, are remeasured at fair value only if an impairment or observable price adjustment is recognized in the current period. Financial Instruments Not Recorded at Fair Value on a Recurring Basis Financial instruments not recorded at fair value on a recurring basis include vendor financing arrangements. The carrying value of the vendor financing agreements were $1.3 million and $1.1 million as of June 30, 2022 and December 31, 2021, respectively. The Company’s vendor financing arrangements are classified within Level 2 because these borrowings are not actively traded and have a variable interest rate structure based upon market rates currently available to the Company for debt with similar terms and maturities. The estimated fair values of these financial instruments approximate their carrying values.

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2022

Accounting Policies [Abstract]

Schedules of Concentration of Risk

Accounts receivable from the Company’s major customers representing 10% or more of total accounts receivable was as follows:


	As of
	June 30, 2022		December 31, 2021
Customer A	18	%	*
Customer B	15	%	*
Customer C	12	%	*
Customer D	*		33	%
Customer E	*		21	%
Customer F	*		12	%

*Customer accounted for less than 10% of total accounts receivable at period end.

Revenue from the Company’s major customers representing 10% or more of total revenue was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Customer D	32	%	26	%	26	%	21	%
Customer E	*		10	%	*		*
Customer F	*		*		11	%	*

*Customer accounted for less than 10% of total revenue in the period.

REVENUE (Tables)

6 Months Ended

Jun. 30, 2022

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table shows revenue by product and services groups (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Licensing, support and maintenance	$	14,033	$	10,056	$	24,608	$	16,217
Variable royalties	587		684		1,571		1,174
Other	202		73		398		80
Total	$	14,822	$	10,813	$	26,577	$	17,471

Contract Balances on Condensed Consolidated Balance Sheet

The following table provides information about accounts receivable, net, contract assets and deferred revenue (in thousands):


	As of
	June 30, 2022		December 31, 2021
Accounts receivable, net	$	4,705	$	13,873
Contract assets	$	1,877	$	1,486
Deferred revenue	$	47,785	$	49,176

Capitalized Direct Commission Costs

Total capitalized direct commission costs were as follows (in thousands):


	As of
	June 30, 2022		December 31, 2021
Short-term commissions capitalized in prepaid expenses and other current assets	$	2,396	$	2,289
Long-term commissions capitalized in other assets	1,746		1,719
Total	$	4,142	$	4,008

NET LOSS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2022

Earnings Per Share [Abstract]

Schedule of Net Loss Per Share

The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share data):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator:
Net loss	$	(5,668)	$	(3,909)	$	(12,488)	$	(10,626)
Denominator:
Weighted-average shares outstanding - basic and diluted	32,258,228		19,874,925		31,940,293		19,354,965
Net loss per share, basic and diluted	$	(0.18)	$	(0.20)	$	(0.39)	$	(0.55)

Schedule of Potentially Dilutive Securities Excluded from the Calculation of Diluted Earnings Per Share

The following table summarizes the potentially dilutive securities that were excluded from the calculation of diluted earnings per share because they would be antidilutive:


	As of
	June 30, 2022	June 30, 2021
Stock options	4,355,694	6,201,315
Restricted stock units	5,220,177	2,887,064
Redeemable convertible preferred stock	—	4,471,316
Total	9,575,871	13,559,695

INTANGIBLE ASSETS AND GOODWILL (Tables)

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets

Intangible assets, net consisted of the following as of June 30, 2022 (in thousands):


	Gross Fair Value		Accumulated Amortization		Net Book Value
Developed technology	$	1,700	$	(538)	$	1,162
Customer relationships	1,100		(218)		882
IPR&D	500		—		500
Trade name and other	177		—		177
Total intangibles	$	3,477	$	(756)	$	2,721

Intangible assets, net consisted of the following as of December 31, 2021 (in thousands):


	Gross Fair Value		Accumulated Amortization		Net Book Value
Developed technology	$	1,700	$	(368)	$	1,332
Customer relationships	1,100		(149)		951
IPR&D	500		—		500
Trade name and other	176		—		176
Total intangibles	$	3,476	$	(517)	$	2,959

Schedule of Future Amortization Expense

The expected future amortization expense of these intangible assets as of June 30, 2022 is as follows (in thousands):


Fiscal year ending December 31,	Amount
Remainder of 2022	$	239
2023	478
2024	478
2025	449
2026	138
Thereafter	262
Total future amortization expense	$	2,044

LEASES (Tables)

6 Months Ended

Jun. 30, 2022

Leases [Abstract]

Operating Lease Costs

Total operating lease related costs were as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Operating lease cost	$	266	$	238	$	539	$	474
Short-term lease cost	92		36		225		52
Total lease cost	$	358	$	274	$	764	$	526

Maturities of Operating Lease Liabilities

Maturities of operating lease liabilities as of June 30, 2022 were as follows (in thousands):


Fiscal year ending December 31,	Amount
Remainder of 2022	$	593
2023	990
2024	449
2025	278
2026	212
Thereafter	212
Total undiscounted cash flows	$	2,734
Less: imputed interest	(313)
Present value of lease liabilities	$	2,421

Operating lease liabilities, current	$	1,027
Operating lease liabilities, non-current	1,394
	$	2,421

BORROWINGS (Tables)

6 Months Ended

Jun. 30, 2022

Debt Disclosure [Abstract]

Schedule of Vendor Financing Arrangements

Vendor financing arrangements as of June 30, 2022 were as follows (in thousands):


Fiscal year ending December 31,	Amount
Remainder of 2022	$	427
2023	650
2024	331
Total undiscounted cash flows	$	1,408
Less: imputed interest	(92)
Present value of vendor financing arrangements	$	1,316

Vendor financing arrangements, current	$	1,077
Vendor financing arrangements, noncurrent	239
	$	1,316

STOCK-BASED COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2022

Share-based Payment Arrangement [Abstract]

Shares Available for Future Grant

Shares available for future grant consisted of the following:


			As of
			June 30, 2022
Shares available for future grant under the 2021 Plan			3,734,035
Shares available for future grant under the 2021 ESPP			922,306

Summary of Stock Options Activity

The following table summarizes the stock option activities under the Company’s 2016 Plan:


	Options Outstanding
	Number of Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value ($'000s)

BALANCE—December 31, 2021	5,407,170	$	0.96	7.16	$	108,964
Exercised	(766,942)	$	0.58
Canceled	(284,534)	$	0.94
BALANCE—June 30, 2022	4,355,694	$	1.03	6.71	$	25,889
Options vested and exercisable—June 30, 2022	3,069,682	$	0.86	6.22	$	18,742

Summary of Restricted Stock Units Activity

The following table summarizes the restricted stock units activities under the Company’s 2016 and 2021 Plans:


	Restricted Stock Units
	Number of Shares	Weighted-Average Grant Date Fair Value

Unvested—December 31, 2021	3,925,097	$	5.60
Granted	1,851,350	$	13.04
Vested	(394,436)	$	5.73
Forfeited	(161,834)	$	12.29
Unvested—June 30, 2022	5,220,177	$	8.02

Stock-Based Compensation Related to Stock-Based Awards to Employees

The following table presents the amount of stock-based compensation related to stock-based awards to employees on the Company’s condensed consolidated statements of loss and comprehensive loss (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Cost of revenue	$	260	$	14	$	356	$	27
Research and development	1,493		221		2,637		420
Sales and marketing	728		25		999		49
General and administrative	903		118		1,701		215
Total stock-based compensation	$	3,384	$	378	$	5,693	$	711

DESCRIPTION OF BUSINESS (Details) $ / shares in Units, $ in Millions	1 Months Ended
	Oct. 31, 2021 USD ($) $ / shares shares
IPO
Subsidiary, Sale of Stock [Line Items]
Sale of stock, number of shares issued in transaction (in shares) \| shares	5,750,000
Sale of stock (in dollars per share) \| $ / shares	$ 14.00
Sale of stock, consideration received on transaction \| $	$ 71.1
Deferred offering costs \| $	$ 3.8
Over-Allotment Option
Subsidiary, Sale of Stock [Line Items]
Sale of stock, number of shares issued in transaction (in shares) \| shares	750,000

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable Concentration Risk (Details) - Customer Concentration Risk	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Customer A \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage			18.00%
Customer B \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage			15.00%
Customer C \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage			12.00%
Customer D \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage					33.00%
Customer D \| Revenue from Contract with Customer Benchmark
Concentration Risk [Line Items]
Concentration risk, percentage	32.00%	26.00%	26.00%	21.00%
Customer E \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage					21.00%
Customer E \| Revenue from Contract with Customer Benchmark
Concentration Risk [Line Items]
Concentration risk, percentage		10.00%
Customer F \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage					12.00%
Customer F \| Revenue from Contract with Customer Benchmark
Concentration Risk [Line Items]
Concentration risk, percentage			11.00%

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Concentration Risk (Details)	3 Months Ended
	Jun. 30, 2021
Customer E \| Revenue from Contract with Customer Benchmark \| Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk, percentage	10.00%

REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Disaggregation of Revenue [Line Items]
Total revenue	$ 14,822	$ 10,813	$ 26,577	$ 17,471
Deferred revenue, revenue recognized	8,100	5,600	14,700	9,300
Licensing, support and maintenance
Disaggregation of Revenue [Line Items]
Total revenue	14,033	10,056	24,608	16,217
Variable royalties
Disaggregation of Revenue [Line Items]
Total revenue	587	684	1,571	1,174
Other
Disaggregation of Revenue [Line Items]
Total revenue	$ 202	$ 73	$ 398	$ 80

- 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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+ Details

REVENUE - Contract Balances on Condensed Consolidated Balance Sheet (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Revenue from Contract with Customer [Abstract]
Accounts receivable, net	$ 4,705	$ 13,873
Contract assets	1,877	1,486
Deferred revenue	$ 47,785	$ 49,176

REVENUE - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
REVENUE - Narrative (Details) - USD ($) $ in Millions	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Disaggregation of Revenue [Line Items]
Deferred revenue, revenue recognized	$ 8.1	$ 5.6	$ 14.7	$ 9.3
Unsatisfied performance obligations	47.9		47.9		$ 49.3
Flexible spending account commitment	0.2		0.2		$ 0.2
Amortization of capitalized sales commissions	$ 0.9	$ 0.3	$ 1.6	$ 0.7
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-06-30
Disaggregation of Revenue [Line Items]
Remaining performance obligation, expected timing of satisfaction, excluding flexible spending account	12 months		12 months
Unsatisfied performance obligations, excluding flexible spending account commitment	$ 25.1		$ 25.1

REVENUE - Capitalized Direct Commission Costs (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Revenue from Contract with Customer [Abstract]
Short-term commissions capitalized in prepaid expenses and other current assets	$ 2,396	$ 2,289
Long-term commissions capitalized in other assets	1,746	1,719
Total	$ 4,142	$ 4,008

NET LOSS PER SHARE - Schedule of Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Numerator:
Net loss	$ (5,668)	$ (3,909)	$ (12,488)	$ (10,626)
Denominator:
Weighted-average shares outstanding - basic (in shares)	32,258,228	19,874,925	31,940,293	19,354,965
Weighted-average shares outstanding - diluted (in shares)	32,258,228	19,874,925	31,940,293	19,354,965
Net loss per share, basic (in dollars per share)	$ (0.18)	$ (0.20)	$ (0.39)	$ (0.55)
Net loss per share, diluted (in dollars per share)	$ (0.18)	$ (0.20)	$ (0.39)	$ (0.55)

- Definition

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

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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.

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

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+ Details

NET LOSS PER SHARE - Schedule of Potentially Dilutive Securities Excluded from the Calculation of Diluted Earnings Per Share (Details) - shares	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	9,575,871	13,559,695
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	4,355,694	6,201,315
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	5,220,177	2,887,064
Redeemable convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	0	4,471,316

FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions	Jun. 30, 2022	Dec. 31, 2021
Reported Value Measurement
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Carrying value of term loan and vendor financing agreements	$ 1.3	$ 1.1

INTANGIBLE ASSETS AND GOODWILL - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 3,477	$ 3,476
Finite-lived intangible assets, accumulated amortization	(756)	(517)
Total future amortization expense	2,044
Intangible assets, net	2,721	2,959
IPR&D
Finite-Lived Intangible Assets [Line Items]
Indefinite-lived intangible assets, gross	500	500
Finite-lived intangible assets, accumulated amortization	0	0
Trade name and other
Finite-Lived Intangible Assets [Line Items]
Indefinite-lived intangible assets, gross	177	176
Finite-lived intangible assets, accumulated amortization	0	0
Developed technology
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross	1,700	1,700
Finite-lived intangible assets, accumulated amortization	(538)	(368)
Total future amortization expense	1,162	1,332
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets, gross	1,100	1,100
Finite-lived intangible assets, accumulated amortization	(218)	(149)
Total future amortization expense	$ 882	$ 951

INTANGIBLE ASSETS AND GOODWILL - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 100,000	$ 100,000	$ 200,000	$ 200,000
Goodwill	2,677,000		2,677,000		$ 2,677,000
Goodwill impairments	$ 0	$ 0	$ 0	$ 0

INTANGIBLE ASSETS AND GOODWILL - Schedule of Future Amortization Expense (Details) $ in Thousands	Jun. 30, 2022 USD ($)
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
Remainder of 2022	$ 239
2023	478
2024	478
2025	449
2026	138
Thereafter	262
Total future amortization expense	$ 2,044

LEASES - Operating Lease Costs (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Leases [Abstract]
Operating lease cost	$ 266	$ 238	$ 539	$ 474
Short-term lease cost	92	36	225	52
Total lease cost	$ 358	$ 274	$ 764	$ 526

LEASES - Narrative (Details)	Jun. 30, 2022	Dec. 31, 2021
Leases [Abstract]
Weighted average remaining lease term, operating lease	3 years 3 months 18 days	3 years 7 months 6 days
Weighted average discount rate, operating lease	7.50%	7.50%

LEASES - Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Leases [Abstract]
Remainder of 2022	$ 593
2023	990
2024	449
2025	278
2026	212
Thereafter	212
Total undiscounted cash flows	2,734
Less: imputed interest	(313)
Present value of lease liabilities	2,421
Operating lease liabilities, current	1,027	$ 961
Operating lease liabilities, non-current	$ 1,394	$ 1,851

BORROWINGS - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
BORROWINGS - Narrative (Details) - USD ($) $ in Millions	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Debt Instrument [Line Items]
Interest expense	$ 0.1	$ 0.1	$ 0.1	$ 0.1
Vendor Financing Arrangements
Debt Instrument [Line Items]
Interest rate, effective percentage	7.50%		7.50%

BORROWINGS - Schedule of Vendor Financing Arrangements (Details) - Vendor Financing Arrangements $ in Thousands	Jun. 30, 2022 USD ($)
Debt Instrument [Line Items]
Remainder of 2022	$ 427
2023	650
2024	331
Total undiscounted cash flows	1,408
Less: imputed interest	(92)
Present value of vendor financing arrangements	1,316
Vendor financing arrangements, current	1,077
Vendor financing arrangements, noncurrent	$ 239

REDEEMABLE CONVERTIBLE PREFERRED STOCK, PREFERRED STOCK AND COMMON STOCK (Details) $ in Thousands	Jun. 30, 2022 USD ($) vote shares	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($) shares	Oct. 31, 2021 USD ($) shares	Jun. 30, 2021 USD ($)	Mar. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Temporary Equity [Line Items]
Temporary equity, carrying value \| $	$ 0	$ 0	$ 0	$ 5,700	$ 5,712	$ 5,712	$ 5,712
Redeemable convertible preferred stock, issued (in shares)	0		0
Preferred stock, authorized (in shares)	10,000,000		10,000,000	10,000,000
Number of votes per common share \| vote	1
Common stock, authorized (in shares)	300,000,000			300,000,000
IPO
Temporary Equity [Line Items]
Common shares issued upon conversion (in shares)				4,471,316

- Definition

Carrying amount, attributable to parent, of an entity's issued and outstanding stock which is not included within permanent equity. Temporary equity is a security with redemption features that are outside the control of the issuer, is not classified as an asset or liability in conformity with GAAP, and is not mandatorily redeemable. Includes any type of security that is redeemable at a fixed or determinable price or on a fixed or determinable date or dates, is redeemable at the option of the holder, or has conditions for redemption which are not solely within the control of the issuer. Includes stock with a put option held by an ESOP and stock redeemable by a holder only in the event of a change in control of the issuer.

+ References + Details

STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Millions	6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercises in period, intrinsic value	$ 8.0	$ 1.0
Aggregate intrinsic value, vested	0.2	0.1
Option, cost not yet recognized	$ 0.7
Nonvested award, unrecognized, period for recognition	2 years 1 month 6 days
Granted (in shares)	0
2016 Stock Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized for award (in shares)			20,803,838
Non-option equity instruments, granted (in shares)			14,142,208
Shares available for future grant (in shares)			0
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested award, unrecognized, period for recognition	3 years 3 months 18 days
Grants in period, vested, grant date fair value	$ 2.6	$ 0.1
Nonvested award, excluding options, unrecognized	$ 33.8

STOCK-BASED COMPENSATION - Shares Available for Future Grant (Details)	Jun. 30, 2022 shares
2021 Stock Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for future grant (in shares)	3,734,035
2021 Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for future grant (in shares)	922,306

STOCK-BASED COMPENSATION - Summary of Stock Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	6 Months Ended
	Mar. 31, 2022	Jun. 30, 2022	Dec. 31, 2021
Number of Options
Balance at beginning of period (in shares)	5,407,170	5,407,170
Exercised (in shares)		(766,942)
Canceled (in shares)		(284,534)
Balance at end of period (in shares)		4,355,694
Number of Shares, Options vested and exercisable (in shares)		3,069,682
Weighted-Average Exercise Price
Balance at beginning of period (in dollars per share)	$ 0.96	$ 0.96
Exercised (in dollars per share)		0.58
Canceled (in dollars per share)		0.94
Balance at end of period (in dollars per share)		1.03
Weighted-Average Exercise Price, Options vested and exercisable (in dollars per share)		$ 0.86
Stock Options Additional Disclosures
Weighted-Average Remaining Contractual Term, Balance	7 years 1 month 28 days	6 years 8 months 15 days
Weighted-Average Remaining Contractual Term, Options vested and exercisable		6 years 2 months 19 days
Aggregate Intrinsic Value, Balance		$ 25,889	$ 108,964
Aggregate Intrinsic Value, Options vested and exercisable		$ 18,742

STOCK-BASED COMPENSATION - Summary of Restricted Stock Units Activity (Details) - Restricted stock units	6 Months Ended
	Jun. 30, 2022 $ / shares shares
Number of Shares
Unvested, Balance at beginning of period (in shares) \| shares	3,925,097
Granted (in shares) \| shares	1,851,350
Vested (in shares) \| shares	(394,436)
Forfeited (in shares) \| shares	(161,834)
Unvested, Balance at end of period (in shares) \| shares	5,220,177
Weighted-Average Grant Date Fair Value
Unvested, Balance at beginning of period (in dollars per share) \| $ / shares	$ 5.60
Granted (in dollars per share) \| $ / shares	13.04
Vested (in dollars per share) \| $ / shares	5.73
Forfeited (in dollars per share) \| $ / shares	12.29
Unvested, Balance at end of period (in dollars per share) \| $ / shares	$ 8.02

STOCK-BASED COMPENSATION - Stock-Based Compensation Related to Stock-Based Awards to Employees (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 3,384	$ 378	$ 5,693	$ 711
Cost of revenue
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	260	14	356	27
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	1,493	221	2,637	420
Sales and marketing
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	728	25	999	49
General and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 903	$ 118	$ 1,701	$ 215

EQUITY METHOD INVESTMENT (Details) - USD ($) $ in Thousands	6 Months Ended
EQUITY METHOD INVESTMENT (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Subsidiary or Equity Method Investee [Line Items]
Equity method investment	$ 12,169		$ 0
Gain on deconsolidation of subsidiary (Note 12)	149	$ 0
Loans and leases receivable, related parties	$ 300
Loan annual interest rate	4.00%
Arteris IP (Hong Kong) Ltd. \| TransChip Technology
Subsidiary or Equity Method Investee [Line Items]
Percentage of voting interests acquired	40.30%
The Investors \| Arteris IP (Hong Kong) Ltd.
Subsidiary or Equity Method Investee [Line Items]
Share purchase agreement, registered capital	$ 29,400
Amount of shares subscribed	$ 11,900
Share purchase agreement, agreement term	5 years
Share purchase agreement, deferred income, recognition period	10 years
The Investors \| The Investors
Subsidiary or Equity Method Investee [Line Items]
Equity method investment	$ 11,600
TransChip Technology
Subsidiary or Equity Method Investee [Line Items]
Equity method investment	12,200
Equity investment investments, transaction value	11,600
Equity method investment, transaction costs	$ 300

INCOME TAXES (Details) - USD ($)	3 Months Ended		6 Months Ended
INCOME TAXES (Details) - USD ($)	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Income Tax Disclosure [Abstract]
Effective income tax rate			(4.10%)	(3.20%)
Income tax provision	$ 351,000	$ 188,000	$ 474,000	$ 344,000
Unrecognized tax benefits	3,100,000	2,500,000	3,100,000	2,500,000
Income tax penalties and interest accrued related to unrecognized tax benefits	$ 0	$ 0	$ 0	$ 0

- Definition

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

+ References + Details

RELATED PARTY TRANSACTIONS (Details) - USD ($)	3 Months Ended		6 Months Ended
RELATED PARTY TRANSACTIONS (Details) - USD ($)	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022
Related Party Transaction [Line Items]
Granted (in shares)			0
Restricted stock units
Related Party Transaction [Line Items]
Granted (in shares)			1,851,350
Affiliated Entity
Related Party Transaction [Line Items]
Lease payment due to related party	$ 100,000	$ 100,000
Affiliated Entity \| Isabelle Geday \| Consulting Agreement
Related Party Transaction [Line Items]
Related party transaction, agreement term			3 years
Payment for consulting service	100,000		$ 200,000
Affiliated Entity \| Isabelle Geday \| Consulting Agreement \| Related Party Transaction, Tranche One
Related Party Transaction [Line Items]
Related party transaction, agreement term			12 months
Due to related parties, monthly amount	26,445		$ 26,445
Affiliated Entity \| Isabelle Geday \| Consulting Agreement \| Related Party Transaction, Tranche Two
Related Party Transaction [Line Items]
Related party transaction, agreement term			24 months
Due to related parties, monthly amount	$ 19,445		$ 19,445
Affiliated Entity \| Isabelle Geday \| Prior Employment Agreement
Related Party Transaction [Line Items]
Granted (in shares)			455,000
Affiliated Entity \| Isabelle Geday \| Prior Employment Agreement \| Restricted stock units
Related Party Transaction [Line Items]
Lease payment due to related party			$ 100,000
Granted (in shares)			62,200