UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on which | ||||
Title of each class |
| Trading Symbol(s) |
| registered |
Common Stock, par value $0.0001 | MRAM | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
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Item 2.02. Results of Operations and Financial Condition.
On August 11, 2022, Everspin Technologies, Inc. issued a press release announcing its financial results for the quarter ended June 30, 2022, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits.
Exhibit No. |
| Description |
99.1 | ||
104 | Cover Page Interactive Data File (formatted as Inline XBRL) |
Exhibit 99.1
Q2’22 Earnings Press Release
Everspin Reports Unaudited Second Quarter 2022 Financial Results
The Company continues growth and profitability in the first half of 2022 with strong second quarter results
Chandler, AZ, August 11, 2022 — Everspin Technologies, Inc. (NASDAQ: MRAM), the market leader in MRAM, today announced preliminary unaudited financial results for the second quarter of 2022.
Second Quarter 2022 Highlights
| ● | Q2’22 revenue increased $0.4 million, or 3%, to $14.7 million from $14.3 million for Q1’22. Q2’22 revenue increased $2.9 million, or 24% from $11.8 million in Q2’21. |
| ● | The Company reported net income of $1.7 million for Q2’22, compared to $1.9 million for Q1’22, and $0.3 million in Q2’21. |
| ● | Adjusted EBITDA for Q2’22 improved to $3.3 million, compared to $3.1 million for Q1’22, and $1.5 million in Q2’21. |
| ● | Basic EPS for Q2’22 was $0.08 compared to $0.10 for Q1’22, and $0.01 for Q2’21. |
| ● | Ended Q2’22 with cash and cash equivalents of $23.1 million, an increase from $19.9 million at the end of Q1’22. |
“Everspin delivered quarterly revenue of $14.7 million, an increase of 24% year-on-year and above the high end of guidance. Our team continues to successfully navigate changing supply to meet customer demand, which continues to be strong with existing and new design wins on our Toggle products,” said Sanjeev Aggarwal, President & CEO. “We have started sampling our new xSPI family of Low Density STT-MRAM products (8Mb to 128Mb) to drive growth across industrial, IoT and FPGA markets.”
Second Quarter 2022 Results
Total revenue for the second quarter of 2022 was $14.7 million, an increase of 3% from the $14.3 million reported in the first quarter of 2022. This is an increase of 24% compared to $11.8 million of revenue in the second quarter of 2021.
MRAM product sales in the second quarter of 2022, which includes both Toggle and STT-MRAM revenue, was $13.2 million compared to $12.7 million in the first quarter of 2022 and $10.2 million in the second quarter of 2021.
Licensing, Royalties, Patents and Other revenue in the second quarter of 2022 was $1.5 million compared to $1.7 million in the first quarter of 2022 and $1.7 million in the second quarter of 2021.
The increase in total revenue for the second quarter of 2022 compared to the second quarter of 2021 was due to strong toggle demand and sales.
Gross margin for the second quarter of 2022 was 58.4%, compared to 58.0% in the first quarter of 2022, and 60.7% in the second quarter of 2021. The decrease in gross margin compared to the second quarter of 2021 was attributable to price increases from suppliers.
GAAP operating expenses was $6.9 million in the second quarter of 2022, compared to $6.3 million in the first quarter of 2022 and $6.7 million in the second quarter of 2021. GAAP operating expenses increased in the second quarter of 2022 compared to the first quarter of 2022 as a result of increased costs to support the new STT industrial product.
GAAP net income for the second quarter of 2022 was $1.7 million, or $0.08 per basic share, based on 20.1 million weighted-average basic common shares outstanding. This compares to a net income of $1.9 million, or $0.10 per basic share, in the first quarter of 2022 and a net income of $0.3 million, or $0.01 per basic share, in the second quarter of 2021.
Business Outlook
For the third quarter 2022, Everspin expects total revenue in a range of $14.4 million to $15.4 million. Everspin expects industry supply constraints to limit supply and push some unfulfilled customer demand to future quarters. Everspin expects GAAP net income per basic share to be between breakeven and $0.05, primarily influenced by expenses related to next generation 28nm STT MRAM product development and price increases from our suppliers.
This outlook is dependent on Everspin’s current expectations, which may be impacted by, among other things, evolving external conditions, such as the resurgence of COVID-19 and its variants, local safety guidelines, worsening impacts due to supply chain constraints or interruptions, including due to the recent military conflict in Ukraine and recent market volatility, 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, 2021, its Quarterly Reports on Form 10-Q filed with the SEC during 2022, 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 non-GAAP measures differently, which limits the usefulness of these measures 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 Thursday, August 11, 2022, at 5:00 p.m. Eastern Time. Interested participants can pre-register online to receive a telephone number and a unique passcode at:
https://register.vevent.com/register/BIfe7f479f52fa42c082550ca25061f4e1.
The conference call will be broadcast live in listen-only mode at:
https://edge.media-server.com/mmc/p/7befjdfe
The registration link and archived webcast will be available in the Investor Relations section of the company’s website at investor.everspin.com.
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 third quarter 2022 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, 2021 filed with the SEC on March 9, 2022, and its Quarterly Reports on Form 10-Q filed with the SEC during 2022, 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.
Company Contact:
Anuj Aggarwal, CFO
T: 480-347-1082
E: anuj.aggarwal@everspin.com
EVERSPIN TECHNOLOGIES, INC.
Condensed Balance Sheets
(In thousands, except share and per share amounts)
(Unaudited)
| | June 30, | | December 31, | ||
|
| 2022 |
| 2021 | ||
Assets |
| |
|
| |
|
Current assets: |
| |
|
| |
|
Cash and cash equivalents | | $ | 23,051 | | $ | 21,409 |
Accounts receivable, net | |
| 9,283 | |
| 8,193 |
Inventory | |
| 6,376 | |
| 6,396 |
Prepaid expenses and other current assets | |
| 800 | |
| 762 |
Total current assets | |
| 39,510 | |
| 36,760 |
Property and equipment, net | |
| 2,594 | |
| 973 |
Right-of-use assets | | | 3,649 | |
| 913 |
Other assets | |
| 62 | |
| 734 |
Total assets | | $ | 45,815 | | $ | 39,380 |
| | | | | | |
Liabilities and Stockholders’ Equity | |
|
| |
|
|
Current liabilities: | |
|
| |
|
|
Accounts payable | | $ | 2,689 | | $ | 1,776 |
Accrued liabilities | |
| 2,165 | |
| 3,579 |
Deferred revenue | | | — | | | 832 |
Current portion of long-term debt | |
| 3,761 | |
| 3,370 |
Lease liabilities | | | 910 | | | 724 |
Other liabilities | | | 29 | | | 50 |
Total current liabilities | |
| 9,554 | |
| 10,331 |
Long-term debt, net of current portion | |
| — | |
| 1,529 |
Lease liabilities, net of current portion | | | 2,782 | | | 68 |
Long-term income tax liability | | | 214 | | | 214 |
Total liabilities | | $ | 12,550 | | $ | 12,142 |
Commitments and contingencies | |
|
| |
|
|
Stockholders’ equity: | |
|
| |
|
|
Preferred stock, $0.0001 par value per share; 5,000,000 shares authorized; no shares issued and outstanding as of June 30, 2022 and December 31, 2021 | | | — | | | — |
Common stock, $0.0001 par value per share; 100,000,000 shares authorized; 20,137,520 and 19,858,460 shares issued and outstanding as of June 30, 2022, and December 31, 2021 | |
| 2 | | | 2 |
Additional paid-in capital | |
| 182,488 | |
| 180,067 |
Accumulated deficit | |
| (149,225) | |
| (152,831) |
Total stockholders’ equity | |
| 33,265 | |
| 27,238 |
Total liabilities and stockholders’ equity | | $ | 45,815 | | $ | 39,380 |
EVERSPIN TECHNOLOGIES, INC.
Condensed Statements of Operations and Comprehensive Income (Loss)
(In thousands, except share and per share amounts)
(Unaudited)
| | Three Months Ended June 30, | | Six Months Ended June 30, | ||||||||
|
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||
Product sales | | $ | 13,223 | | $ | 10,187 | | $ | 25,894 | | $ | 19,255 |
Licensing, royalty, patent, and other revenue | | | 1,484 | | | 1,661 | | | 3,160 | |
| 2,873 |
Total revenue | |
| 14,707 | |
| 11,848 | |
| 29,054 | |
| 22,128 |
Cost of product sales | | | 5,793 | | | 4,329 | | | 11,545 | | | 8,586 |
Cost of licensing, royalty, patent, and other revenue | | | 323 | | | 323 | | | 595 | | | 361 |
Total cost of sales | |
| 6,116 | |
| 4,652 | |
| 12,140 | |
| 8,947 |
Gross profit | |
| 8,591 | |
| 7,196 | |
| 16,914 | |
| 13,181 |
Operating expenses:1 | |
|
| |
|
| |
|
| |
|
|
Research and development | |
| 2,699 | |
| 3,357 | |
| 5,135 | |
| 5,796 |
General and administrative | |
| 2,860 | |
| 2,338 | |
| 5,589 | |
| 5,181 |
Sales and marketing | |
| 1,292 | |
| 1,045 | |
| 2,426 | |
| 2,032 |
Total operating expenses | |
| 6,851 | |
| 6,740 | |
| 13,150 | |
| 13,009 |
Income from operations | |
| 1,740 | |
| 456 | |
| 3,764 | |
| 172 |
Interest expense | |
| (70) | |
| (144) | |
| (145) | |
| (296) |
Other income (expense), net | | | 1 | | | (12) | |
| (13) | |
| (27) |
Net income (loss) before income taxes | | | 1,671 | | | 300 | | | 3,606 | | | (151) |
Income tax expense | | | — | | | (44) | | | — | | | (53) |
Net income (loss) and comprehensive income (loss) | | $ | 1,671 | | $ | 256 | | $ | 3,606 | | $ | (204) |
Net income (loss) per common share: | | | | | | | | | | | | |
Basic | | $ | 0.08 | | $ | 0.01 | | $ | 0.18 | | $ | (0.01) |
Diluted | | $ | 0.08 | | $ | 0.01 | | $ | 0.17 | | $ | (0.01) |
Weighted average shares of common stock outstanding: | | | | | | | | | | | | |
Basic | |
| 20,069,444 | |
| 19,313,162 | |
| 19,983,526 | |
| 19,203,374 |
Diluted | |
| 20,424,283 | |
| 19,726,064 | |
| 20,626,547 | |
| 19,203,374 |
| | | | | | | | | | | | |
1Operating expenses include stock-based compensation as follows: | ||||||||||||
Research and development | | $ | 462 | | $ | 265 | | $ | 795 | | $ | 446 |
General and administrative | | | 647 | | | 305 | | | 1,018 | | | 790 |
Sales and marketing | | | 202 | | | 134 | | | 322 | | | 211 |
Total stock-based compensation | | $ | 1,311 | | $ | 704 | | $ | 2,135 | | $ | 1,447 |
EVERSPIN TECHNOLOGIES, INC.
Condensed Statement of Cash Flows
(In thousands)
(Unaudited)
| | Six Months Ended June 30, | ||||
|
| 2022 |
| 2021 | ||
Cash flows from operating activities |
| |
|
| |
|
Net income (loss) | | $ | 3,606 | | $ | (204) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |
| | |
| |
Depreciation and amortization | |
| 462 | |
| 756 |
Gain on sale of property and equipment | |
| (167) | |
| — |
Stock-based compensation | |
| 2,135 | |
| 1,447 |
Non-cash warrant revaluation | | | (21) | | | 5 |
Non-cash interest expense | |
| 62 | |
| 168 |
Changes in operating assets and liabilities: | |
| | |
| |
Accounts receivable | |
| (1,090) | |
| (2,776) |
Inventory | |
| 20 | |
| (850) |
Prepaid expenses and other current assets | |
| (38) | |
| 49 |
Other assets | |
| 664 | |
| — |
Accounts payable | |
| (201) | |
| 861 |
Accrued liabilities | |
| (1,414) | |
| (126) |
Deferred revenue | | | (832) | | | 1,815 |
Lease liabilities | | | 164 | | | (64) |
Net cash provided by operating activities | |
| 3,350 | |
| 1,081 |
Cash flows from investing activities | |
| | |
| |
Purchases of property and equipment | |
| (996) | |
| (554) |
Proceeds received from sale of property and equipment | | | 202 | | | — |
Net cash used in investing activities | |
| (794) | |
| (554) |
Cash flows from financing activities | |
| | |
| |
Payments on long-term debt | |
| (1,200) | |
| (1,200) |
Proceeds from exercise of stock options and purchase of shares in employee stock purchase plan | |
| 286 | |
| 293 |
Net cash used in financing activities | |
| (914) | |
| (907) |
Net increase (decrease) in cash and cash equivalents | |
| 1,642 | |
| (380) |
Cash and cash equivalents at beginning of period | |
| 21,409 | |
| 14,599 |
Cash and cash equivalents at end of period | | $ | 23,051 | | $ | 14,219 |
Supplementary cash flow information: | |
| | |
| |
Interest paid | | $ | 83 | | $ | 128 |
Operating cash flows paid for operating leases | | $ | 635 | | $ | 814 |
Financing cash flows paid for finance leases | | $ | 5 | | $ | — |
Non-cash investing and financing activities: | |
| | |
| |
Right-of-use assets obtained in exchange for operating lease liabilities | | $ | 3,350 | | $ | — |
Right-of-use assets obtained in exchange for finance lease liabilities | | $ | 36 | | $ | — |
Purchases of property and equipment in accounts payable and accrued liabilities | | $ | 783 | | $ | — |
Bonus settled in shares of common stock | | $ | — | | $ | 364 |
EVERSPIN TECHNOLOGIES, INC.
Adjusted EBITDA Reconciliation
(In thousands)
(Unaudited)
|
| Three Months Ended | |||||||
|
| June 30, 2022 |
| March 31, 2022 |
| June 30, 2021 | |||
Adjusted EBITDA reconciliation: |
|
|
|
|
|
|
|
|
|
Net income |
| $ | 1,671 |
| $ | 1,935 |
| $ | 256 |
Depreciation and amortization |
|
| 204 |
|
| 258 |
|
| 373 |
Stock-based compensation expense |
|
| 1,311 |
|
| 824 |
|
| 704 |
Interest expense |
|
| 70 |
|
| 75 |
|
| 144 |
Income tax expense |
|
| - |
|
| - |
|
| 44 |
Adjusted EBITDA |
| $ | 3,256 |
| $ | 3,092 |
| $ | 1,521 |