Here's a quick snippet with a possible solution. It uses nested loops, the outer splitting each path by the delimeter and pop()ing the file portion out of the array. The inner iterates the parts of the path and constructs the heirarchy by reasigning branch on each iteration. Finally the file portion of the path is added to the deepest branch.

const data = [
  'files/photos/foo.png',
  'files/photos/bar.png',
  'files/videos/movie.mov',
  'docs/photos/sd.jpg'
];

const tree = { root: {} }
for (const path of data) {

  const parts = path.split('/');
  const file = parts.pop();

  let branch = tree, partPath = '';
  for (const part of parts) {
    partPath += `${part}/`;

    if (partPath === `${part}/`) {
      tree.root[partPath] = (tree[partPath] ??= { name: part, children: [] });
    } else if (tree[partPath] === undefined) {
        tree[partPath] = { name: part, children: [] };
        branch.children.push(tree[partPath]);
    }

    branch = tree[partPath];
  }

  branch.children.push({ name: file, id: path });
}

const result = Object.values(tree.root)

console.log(JSON.stringify(result, null, 2))

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.as-console-row::after { display: none !important; }

Or as a function.

function mergeAssets(assets) {
  const tree = { root: {} }

  for (const path of data) {
    const parts = path.split('/');
    const file = parts.pop();

    let branch = tree, partPath = '';
    for (const part of parts) {
      partPath += `${part}/`;

      if (partPath === `${part}/`) {
        tree.root[partPath] = (tree[partPath] ??= { name: part, children: [] });
      } else if (tree[partPath] === undefined) {
        tree[partPath] = { name: part, children: [] };
        branch.children.push(tree[partPath]);
      }

      branch = tree[partPath];
    }

    branch.children.push({ name: file, id: path });
  }

  return {
    name: "assets",
    children: Object.values(tree.root)
  }
}

const data = [
  'files/photos/foo.png',
  'files/photos/bar.png',
  'files/videos/movie.mov',
  'docs/photos/sd.jpg'
];

const result = mergeAssets(data);

console.log(JSON.stringify(result, null, 2))

I was able to find a solution using a recursive function. If others have any tips on how to improve this, I'd love to hear.

function mergeObjects(parentArray,path,originalName){
    if(originalName === undefined){
        originalName = path;
    }

    const parts = path.split("/");
    var nextPart = "";
    parts.forEach((part, index) => index > 0 ? nextPart += (nextPart !== "" ? "/" : "") + part : null);
    //does the parentArray contain a child with our name?
    const indexOfChild = parentArray.findIndex(child => child.name === parts[0]);
    if(indexOfChild === -1){
        //this item does not exist
        if(parts.length > 1){
            var index = parentArray.push({
                name: parts[0],
                children : []
            }) - 1;
            mergeObjects(parentArray[index].children,nextPart,originalName);
        }else{
            parentArray.push({
                name: parts[0],
                id : originalName
            });
        }
    }else{
        //this item already exists
        if(parts.length > 1){
            mergeObjects(parentArray[indexOfChild].children,nextPart,originalName);
        }
    }
}

And the function is called with the following:

function mergeAssets(assets){
    var obj = {
        name: "assets",
        children: []
    };
    assets.forEach(asset => mergeObjects(obj.children,asset));
    return obj;
}