Revenue rose 8% year over
year to $16.5 million, exceeding guidance.
Net income increased
27.8% year over year to $2.4 million.
Everspin Technologies, Inc. (NASDAQ: MRAM), the market leader in
MRAM, today announced preliminary unaudited financial results for
the third quarter ended September 30, 2023.
Third Quarter 2023 Highlights
- Revenue of $16.5 million increased 8% from $15.2 million in
Q3’22
- Net income of $2.4 million increased 27.8% from $1.9 million in
Q3’22
- Adjusted EBITDA of $4.0 million increased 18.7% from $3.4
million in Q3’22
- Fully diluted EPS of $0.11 increased from $0.09 in Q3’22
- Cash flow from operating activities of $3.6 million, rose from
$0.9 million in Q3’22
- Cash and cash equivalents totaled $34.9 million on September
30, 2023
“We are pleased to report third quarter revenue above the high
end of our guidance range, bolstered by the increased NRE and
licensing revenue from a new Radiation Hard program on Toggle MRAM
and the continuation of our existing Radiation Hard programs on
STT-MRAM technologies,” said Sanjeev Aggarwal, President and Chief
Executive Officer.
“Our R&D and design teams delivered on the milestones to
further the development of STT-MRAM-based solutions for a
high-density memory array and a distributed memory for
configuration in FPGAs. Our dedication to supply chain management,
quality and reliability continues to be recognized across the
board, earning us several design wins with our new STT-MRAM family
of xSPI products from customers in the fast-growing Industrial IoT
and embedded system markets. This new STT-MRAM family of xSPI
products, now available over an extended temperature range of -40⁰C
to 105⁰C and from 4 to 128Mb densities, is well positioned as an
alternative solution to SRAM, BBSRAM, FRAM, NVSRAM, and NOR flash
devices,” said Sanjeev Aggarwal.
“Everspin continues to generate profits, reporting positive GAAP
net income for the 10th consecutive quarter while continuing to
generate strong operational cash flow,” said Anuj Aggarwal,
Everspin’s Chief Financial Officer.
Third Quarter 2023 Results
Total revenue was $16.5 million, an increase of 5% from $15.7
million in the second quarter of 2023 and an increase of 8%
compared to $15.2 million in the third quarter of 2022. The
increase in revenue from the prior quarter was driven by licensing
revenue related to Everspin’s RAD-Hard projects.
MRAM product sales, which includes both Toggle and STT-MRAM
revenue, was $13.5 million, compared to $13.4 million in the second
quarter of 2023 and $14.6 million in the third quarter of 2022.
Licensing, royalties, patents and other revenue was $2.9
million, a 25% increase from $2.3 million in the second quarter of
2023 and an increase of $2.2 million from $0.7 million in the third
quarter of 2022.
Gross margin was 60.2%, compared to 58.4% in the second quarter
of 2023 and 58.8% in the third quarter of 2022. The increase in
gross margin is primarily attributable to increased licensing
revenue.
GAAP operating expenses were $7.9 million 2023, compared to $7.6
million in the second quarter of 2023 and $7.1 million in the third
quarter of 2022. GAAP operating expenses increased in the third
quarter of 2023 compared to the third quarter of 2022 as a result
of increased professional service costs.
GAAP net income was $2.4 million, or $0.11 per diluted share,
based on 21.8 million weighted-average fully diluted common shares
outstanding. This compares to net income of $3.9 million, or $0.18
per diluted share, in the second quarter of 2023 and net income of
$1.9 million, or $0.09 per diluted share, in the third quarter of
2022.
Adjusted EBITDA was $4.0 million, compared to $5.4 million in
the second quarter of 2023 and $3.4 million in the third quarter of
2022.
Cash and cash equivalents as of September 30, 2023 were $34.9
million, compared to $30.8 million as of June 30, 2023, and $23.4
million as of September 30, 2022.
Cash flows from operating activities were $3.6 million, compared
to $6.3 million in the second quarter of 2023, and $0.9 million in
the third quarter of 2022.
Business Outlook
For the fourth quarter 2023, Everspin expects total revenue in a
range of $15.4 million to $16.4 million and GAAP net income per
diluted share to be between $0.01 and $0.06.
This outlook is dependent on Everspin's current expectations,
which may be impacted by, among other things, evolving external
conditions, such as COVID-19 and its variants, local safety
guidelines, worsening impacts due to supply chain constraints or
interruptions, including due to the military conflict in Ukraine,
instability in the Middle East, recent market volatility,
semiconductor downturn and the other risk factors described in
Everspin's filings with the Securities and Exchange Commission (the
"SEC"), including its Annual Report on Form 10-K for the fiscal
year ended December 31, 2022, its Quarterly Reports on Form 10-Q
filed with the SEC during 2023, as well as in its subsequent
filings with the SEC.
Use of Non-GAAP Financial Measures
Everspin supplements the reporting of its financial information
determined under generally accepted accounting principles in the
United States of America (GAAP) with Adjusted EBITDA, which is a
non-GAAP financial measure. Everspin defines Adjusted EBITDA as net
income adjusted for interest expense, taxes, depreciation and
amortization, stock-based compensation expense, and restructuring
costs (if any).
Everspin’s management and board of directors use Adjusted EBITDA
to understand and evaluate its operating performance and trends, to
prepare and approve its annual budget and to develop short-term and
long-term operating and financing plans. Accordingly, Everspin
believes that Adjusted EBITDA provides useful information for
investors in understanding and evaluating its operating results in
the same manner as its management and board of directors. Adjusted
EBITDA is a non-GAAP financial measure and should be considered in
addition to, not as superior to, or as a substitute for, net income
reported in accordance with GAAP. Moreover, other companies may
define Adjusted EBITDA differently, which limits the usefulness of
this measure for comparisons with such other companies. Everspin
encourages investors to review its financial statements and
publicly-filed reports in their entirety and not to rely on any
single financial measure.
Conference Call
Everspin will host a conference call for analysts and investors
on Wednesday, November 1, 2023, at 5:00 p.m. Eastern Time.
Dial-in details: To access the call by phone, please go to this
link (registration link) and you will be provided with dial-in
details. To avoid delays, we encourage participants to dial into
the conference call fifteen minutes ahead of the scheduled start
time.
The live webcast of the call will be accessible on the Company’s
website at investor.everspin.com. Approximately two hours after
conclusion of the live event, an archived webcast of the conference
call will be accessible from the Investor Relations section of the
Company’s website for twelve months.
About Everspin Technologies
Everspin Technologies, Inc. is the world’s leading provider of
Magnetoresistive RAM (MRAM). Everspin MRAM delivers the industry’s
most robust, highest performance non-volatile memory for Industrial
IoT, Data Center, and other mission-critical applications where
data persistence is paramount. Headquartered in Chandler, Arizona,
Everspin provides commercially available MRAM solutions to a large
and diverse customer base. For more information, visit
www.everspin.com. NASDAQ: MRAM.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains forward-looking statements regarding
future results that involve risks and uncertainties that could
cause actual results or events to differ materially from the
expectations disclosed in the forward-looking statements,
including, but not limited to the statements made under the caption
“Business Outlook.” Forward-looking statements are identified by
words such as “expects” or similar expressions. These include, but
are not limited to, Everspin’s future financial performance,
including the outlook for fourth quarter 2023 results. Actual
results could differ materially from these forward-looking
statements as a result of certain risks and uncertainties,
including, without limitation, the risks set forth under the
caption “Risk Factors” in Everspin’s Annual Report on Form 10-K for
the year ended December 31, 2022 filed with the SEC on March 2,
2023, and its Quarterly Reports on Form 10-Q filed with the SEC
during 2023, as well as in its subsequent filings with the SEC. Any
forward-looking statements made by Everspin in this press release
speak only as of the date on which they are made and subsequent
events may cause these expectations to change. Everspin disclaims
any obligations to update or alter these forward-looking statements
in the future, whether as a result of new information, future
events or otherwise, except as required by law.
EVERSPIN TECHNOLOGIES,
INC.
Balance Sheets
(In thousands, except share
and per share amounts)
(Unaudited)
September 30,
December 31,
2023
2022
Assets
Current assets:
Cash and cash equivalents
$
34,934
$
26,795
Accounts receivable, net
10,088
10,665
Inventory
8,637
6,683
Prepaid expenses and other current
assets
238
604
Total current assets
53,897
44,747
Property and equipment, net
3,251
3,883
Right-of-use assets
5,786
6,641
Other assets
62
62
Total assets
$
62,996
$
55,333
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
2,570
$
2,778
Accrued liabilities
3,479
3,533
Deferred revenue
510
821
Current portion of long-term debt
—
2,594
Lease liabilities, current portion
1,172
1,122
Other liabilities
—
27
Total current liabilities
7,731
10,875
Long-term debt, net of current portion
—
—
Lease liabilities, net of current
portion
4,693
5,580
Long-term income tax liability
214
214
Total liabilities
$
12,638
$
16,669
Commitments and contingencies (Note 5)
Stockholders’ equity:
Preferred stock, $0.0001 par value per
share; 5,000,000 shares authorized; no shares issued and
outstanding as of September 30, 2023 and December 31, 2022,
respectively
—
—
Common stock, $0.0001 par value per share;
100,000,000 shares authorized; 20,934,919 and 20,374,288 shares
issued and outstanding as of September 30, 2023 and December 31,
2022, respectively
2
2
Additional paid-in capital
189,974
185,364
Accumulated deficit
(139,618
)
(146,702
)
Total stockholders’ equity
50,358
38,664
Total liabilities and stockholders’
equity
$
62,996
$
55,333
EVERSPIN TECHNOLOGIES,
INC.
Statements of Income and
Comprehensive Income
(In thousands, except share
and per share amounts)
(Unaudited)
Three Months Ended September
30,
Nine Months Ended September
30,
2023
2022
2023
2022
Product sales
$
13,543
$
14,571
$
40,726
$
40,465
Licensing, royalty, patent, and other
revenue
2,923
670
6,333
3,830
Total revenue
16,466
15,241
47,059
44,295
Cost of product sales
5,920
6,122
18,133
17,667
Cost of licensing, royalty, patent, and
other revenue
627
155
1,384
750
Total cost of sales
6,547
6,277
19,517
18,417
Gross profit
9,919
8,964
27,542
25,878
Operating expenses:1
Research and development
2,659
2,879
8,566
8,014
General and administrative
3,933
2,971
10,660
8,560
Sales and marketing
1,348
1,203
4,018
3,629
Total operating expenses
7,940
7,053
23,244
20,203
Income from operations
1,979
1,911
4,298
5,675
Interest expense
—
(73
)
(63
)
(218
)
Other income (expense), net
459
69
2,849
56
Net income before income taxes
2,438
1,907
7,084
5,513
Income tax expense
—
—
—
—
Net income and comprehensive income
$
2,438
$
1,907
$
7,084
$
5,513
Net income per common share:
Basic
$
0.12
$
0.09
$
0.34
$
0.27
Diluted
$
0.11
$
0.09
$
0.33
$
0.27
Weighted average shares of common stock
outstanding:
Basic
20,848,558
20,206,728
20,653,775
20,058,744
Diluted
21,828,789
20,539,064
21,276,904
20,698,814
1Operating expenses include stock-based
compensation as follows:
Research and development
$
505
$
462
$
1,454
$
1,257
General and administrative
639
598
1,874
1,616
Sales and marketing
136
92
372
414
Total stock-based compensation
$
1,280
$
1,152
$
3,700
$
3,287
EVERSPIN TECHNOLOGIES,
INC.
Statements of Cash
Flows
(In thousands)
(Unaudited)
Nine Months Ended September
30,
2023
2022
Cash flows from operating
activities
Net income
$
7,084
$
5,513
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
905
704
Gain on sale of property and equipment
(15
)
(167
)
Stock-based compensation
3,700
3,287
Loss on prepayment and termination of
credit facility
170
—
Non-cash warrant revaluation
(25
)
(21
)
Non-cash interest expense
26
93
Changes in operating assets and
liabilities:
Accounts receivable
577
(4,357
)
Inventory
(1,954
)
(1,466
)
Prepaid expenses and other current
assets
366
470
Other assets
—
(28
)
Accounts payable
599
1,218
Accrued liabilities
(54
)
(1,138
)
Deferred revenue
(311
)
(25
)
Lease liabilities
18
175
Net cash provided by operating
activities
11,086
4,258
Cash flows from investing
activities
Purchases of property and equipment
(1,080
)
(1,320
)
Proceeds received from sale of property
and equipment
15
202
Net cash used in investing activities
(1,065
)
(1,118
)
Cash flows from financing
activities
Payments on long-term debt
(2,790
)
(1,800
)
Payments of debt issuance costs
—
(10
)
Proceeds from exercise of stock options
and purchase of shares in employee stock purchase plan
908
703
Net cash used in financing activities
(1,882
)
(1,107
)
Net increase in cash and cash
equivalents
8,139
2,033
Cash and cash equivalents at beginning of
period
26,795
21,409
Cash and cash equivalents at end of
period
$
34,934
$
23,442
Supplementary cash flow
information:
Interest paid
$
37
$
125
Operating cash flows paid for operating
leases
$
1,038
$
978
Financing cash flows paid for finance
leases
$
9
$
8
Non-cash investing and financing
activities:
Right-of-use assets obtained in exchange
for operating lease liabilities
$
—
$
6,837
Right-of-use assets obtained in exchange
for finance lease liabilities
$
—
$
36
Purchases of property and equipment in
accounts payable and accrued liabilities
$
—
$
773
Cashless exercise of warrants
$
2
$
—
EVERSPIN TECHNOLOGIES,
INC.
Adjusted EBITDA
Reconciliation
(In thousands)
(Unaudited)
Three Months Ended
September 30, 2023
June 30, 2023
September 30, 2022
Adjusted EBITDA reconciliation:
Net income
$
2,438
$
3,885
$
1,907
Depreciation and amortization
288
284
242
Stock-based compensation expense
1,280
1,260
1,152
Interest expense
-
-
73
Income tax expense
-
-
-
Adjusted EBITDA
$
4,006
$
5,429
$
3,374
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231101001406/en/
Investor Relations: Monica Gould The Blueshirt Group T:
212-871-3927 E: monica@blueshirtgroup.com
Everspin Technologies (NASDAQ:MRAM)
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