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Everspin Reports Second Quarter 2020 Financial Results

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Everspin Reports Second Quarter 2020 Financial Results

 Achieves Another Quarter of Sequential Growth Driven by Record STT-MRAM Revenue

CHANDLER, Ariz.--(BUSINESS WIRE)--Aug. 6, 2020-- Everspin Technologies, Inc. (NASDAQ: MRAM), the market leader in MRAM, today announced financial results for the second quarter ended June 30, 2020.

Second Quarter and Recent Highlights

  • Total revenue increased 37% year-over-year and 17% sequentially to $11.8 million
  • Operating expenses declined 18% over the prior year period
  • GAAP loss improved to $1.3 million, or ($0.07) per share, and non-GAAP loss to $0.4 million, or ($0.02), compared to $3.7 million, or ($0.21) per share, and $2.9 million, or ($0.17) per share, respectively, in the second quarter of 2019
  • Achieved positive adjusted EBITDA of $0.2 million, compared to a negative ($2.2) million in the year-ago quarter
  • Appointed Daniel Berenbaum CFO bringing strong semiconductor finance and Wall Street experience to the executive team
  • Ended quarter with cash and equivalents of $12.9 million

“We extended our momentum into the second quarter, achieving the fourth consecutive quarter of growth including record revenue from the ramp of our 1Gb STT-MRAM product,” stated Kevin Conley, Everspin’s President and CEO. “A significant contributor to this growth was our ability to respond to a surge in demand from our OEM customers that supply the data center market.

“Entering the third quarter, we are seeing a delay of customers’ new product introduction plans, resulting in reduced visibility and expectations for the quarter. Despite these current market challenges, we remain encouraged about our future growth opportunities, growing pipeline of business and improved financial positioning.”

Second Quarter 2020 Results

Total revenue for the second quarter of 2020 was $11.8 million, an increase of 17% from the $10.1 million last quarter and 37% over the $8.6 million reported in the second quarter of 2019.

Gross margin for the second quarter of 2020 was 43.9%, compared to 52.9% in the prior quarter and 46.5% in the second quarter of 2019.

GAAP operating expenses for the second quarter of 2020 decreased to $6.3 million, compared to $6.9 million in the first quarter of 2020 and $7.6 million in the second quarter of 2019. On a non-GAAP basis, operating expenses for the second quarter of 2020 were $5.4 million, compared to $6.2 million in the prior quarter and $6.8 million in the year-ago quarter.

GAAP net loss for the second quarter of 2020 was $1.3 million, or ($0.07) per share, based on 18.7 million weighted-average shares outstanding. This compares to a net loss of $1.7 million, or ($0.10) per share, in the first quarter of 2020 and a net loss of $3.7 million, or ($0.21) per share, in the second quarter of 2019.

On a non-GAAP basis, net loss for the second quarter of 2020 was $0.4 million, or ($0.02) per share, compared to a net loss of $1.0 million, or ($0.05) per share, in the prior quarter, and a net loss of $2.9 million, or ($0.17) per share, in the second quarter of 2019.

Adjusted EBITDA for the second quarter of 2020 improved to a positive $0.2 million, compared to a negative ($0.3) million last quarter and a negative ($2.2) million in the prior year period.

Cash and cash equivalents as of June 30, 2020 were $12.9 million, compared to $14.0 million at the end of the first quarter of 2020.

Business Outlook

For the third quarter of 2020, Everspin expects total revenue of between $10.0 million and $10.8 million, compared to $9.2 million in the year-ago quarter. GAAP net loss is expected to range between ($0.11) and ($0.05) per share. Excluding stock-based compensation expense of $0.05 per share, non-GAAP net loss is expected to range between a loss of ($0.06) per share and breakeven.

Conference Call

Everspin will host a conference call for analysts and investors today at 5:00 p.m. Eastern Time. Interested participants can access the call by dialing 1-844-889-7788 and providing passcode 3958179. International callers may join the call by dialing +1-661-378-9932, using the same code. The call will also be available as a live and archived webcast in the Investor Relations section of the company’s website at investor.everspin.com.

A telephone replay of the conference call will be available approximately two hours after the call through August 13, 2020. The replay can be accessed by dialing 1-855-859-2056 and using the passcode 3958179. International callers should dial +1-404-537-3406 and enter the same passcode at the prompt.

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.” Actual results could differ materially from these forward-looking statements as a result of certain factors, including, without limitation, the risks set forth in Everspin’s Form 10-Qs filed with the Securities and Exchange Commission on May 8, 2020, and August 6, 2020, under the caption “Risk Factors.” Subsequent events may cause these expectations to change, and 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.

 

EVERSPIN TECHNOLOGIES, INC.

Condensed Balance Sheets

(In thousands, except share and per share amounts)

(Unaudited)

 

 

 

June 30,

 

December 31,

 

 

2020

 

2019

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

12,916

 

 

$

14,487

 

Accounts receivable, net

 

 

7,339

 

 

 

5,799

 

Inventory

 

 

8,368

 

 

 

7,863

 

Prepaid expenses and other current assets

 

 

501

 

 

 

539

 

Total current assets

 

 

29,124

 

 

 

28,688

 

Property and equipment, net

 

 

2,908

 

 

 

3,479

 

Right-of-use assets

 

 

2,985

 

 

 

3,132

 

Other assets

 

 

73

 

 

 

73

 

Total assets

 

$

35,090

 

 

$

35,372

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

2,074

 

 

$

2,873

 

Accrued liabilities

 

 

1,392

 

 

 

2,727

 

Current portion of long-term debt

 

 

1,073

 

 

 

670

 

Operating lease liabilities

 

 

1,546

 

 

 

1,582

 

Other liabilities

 

 

44

 

 

 

42

 

Total current liabilities

 

 

6,129

 

 

 

7,894

 

Long-term debt, net of current portion

 

 

6,893

 

 

 

7,149

 

Operating lease liabilities, net of current portion

 

 

1,656

 

 

 

1,840

 

Total liabilities

 

 

14,678

 

 

 

16,883

 

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, 2020 and December 31, 2019

 

 

—

 

 

 

—

 

Common stock, $0.0001 par value per share; 100,000,000 shares authorized; 18,869,775 and 18,081,753 shares issued and outstanding as of June 30, 2020 and December 31, 2019

 

 

2

 

 

 

2

 

Additional paid-in capital

 

 

172,098

 

 

 

167,149

 

Accumulated deficit

 

 

(151,688

)

 

 

(148,662

)

Total stockholders’ equity

 

 

20,412

 

 

 

18,489

 

Total liabilities and stockholders’ equity

 

$

35,090

 

 

$

35,372

 

 

EVERSPIN TECHNOLOGIES, INC.

Condensed Statements of Operations and Comprehensive Loss

(In thousands, except share and per share amounts)

(Unaudited)

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2020

 

2019

 

2020

 

2019

 

Product sales

 

$

10,927

 

 

$

8,003

 

 

$

20,562

 

 

$

17,026

 

 

Licensing, royalty, and other revenue

 

 

899

 

 

 

643

 

 

 

1,372

 

 

 

1,646

 

 

Total revenue

 

 

11,826

 

 

 

8,646

 

 

 

21,934

 

 

 

18,672

 

 

Cost of sales

 

 

6,635

 

 

 

4,627

 

 

 

11,392

 

 

 

9,868

 

 

Gross profit

 

 

5,191

 

 

 

4,019

 

 

 

10,542

 

 

 

8,804

 

 

Operating expenses:1

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

2,774

 

 

 

3,519

 

 

 

5,804

 

 

 

7,517

 

 

General and administrative

 

 

2,448

 

 

 

2,856

 

 

 

5,248

 

 

 

6,451

 

 

Sales and marketing

 

 

1,056

 

 

 

1,239

 

 

 

2,159

 

 

 

2,603

 

 

Total operating expenses

 

 

6,278

 

 

 

7,614

 

 

 

13,211

 

 

 

16,571

 

 

Loss from operations

 

 

(1,087

)

 

 

(3,595

)

 

 

(2,669

)

 

 

(7,767

)

 

Interest expense

 

 

(172

)

 

 

(186

)

 

 

(344

)

 

 

(397

)

 

Other (expense) income, net

 

 

(35

)

 

 

111

 

 

 

(13

)

 

 

238

 

 

Net loss and comprehensive loss

 

$

(1,294

)

 

$

(3,670

)

 

$

(3,026

)

 

$

(7,926

)

 

Net loss per common share, basic and diluted

 

$

(0.07

)

 

$

(0.21

)

 

$

(0.16

)

 

$

(0.46

)

 

Weighted-average shares used to compute net loss per common share, basic and diluted

 

 

18,747,124

 

 

 

17,137,338

 

 

 

18,585,339

 

 

 

17,117,777

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1Operating expenses include stock-based compensation as follows:

 

Research and development

 

$

194

 

 

$

161

 

 

$

356

 

 

$

308

 

 

General and administrative

 

 

646

 

 

 

556

 

 

 

1,231

 

 

 

1,065

 

 

Sales and marketing

 

 

78

 

 

 

81

 

 

 

136

 

 

 

129

 

 

Total stock-based compensation

 

$

918

 

 

$

798

 

 

$

1,723

 

 

$

1,502

 

 

 

EVERSPIN TECHNOLOGIES, INC.

Reconciliation of GAAP and Non-GAAP Financial Information

(In thousands, except share and per share amounts)

(Unaudited)

Three Months Ended

Jun 30,
2020

Mar 31,
2020

Jun 30,
2019

Reconciliation of GAAP and non-GAAP operating expenses

 

 

 

 

 

 

GAAP operating expenses

$

6,278

 

$

6,933

 

$

7,614

 

Reconciling item included in research and development

 

 

 

 

 

 

Stock-based compensation

 

160

 

 

137

 

 

133

 

Reconciling item included in selling, general and administrative

 

 

 

 

 

 

Stock-based compensation

 

724

 

 

643

 

 

636

 

Total reconciling items included in operating expenses

 

884

 

 

780

 

 

769

 

Non-GAAP operating expenses

 

$

5,394

 

 

$

6,153

 

 

$

6,845

 

 

GAAP NET INCOME (LOSS)

$

(1,294

)

$

(1,732

)

$

(3,670

)

Reconciling items included in operating expenses

 

 

884

 

 

 

780

 

 

 

769

 

Non-GAAP net income (loss)

$

(410

)

$

(951

)

$

(2,901

)

Non-GAAP net income (loss) per share, basic and diluted

 

$

(0.02

)

 

$

(0.05

)

 

$

(0.17

)

Weighted average shares to compute net loss per common share, basic and diluted

 

18,747

 

 

18,056

 

 

17,137

 

 

EVERSPIN TECHNOLOGIES, INC.

Reconciliation of Adjusted EBITDA

(In thousands)

(Unaudited)

Three Months Ended

Jun 30,
2020

Mar 31,
2020

Jun 30,
2019

Adjusted EBITDA reconciliation:

 

 

 

 

 

 

Net loss

$

(1,294

)

$

(1,732

)

$

(3,670

)

Depreciation and amortization

 

 

404

 

 

 

409

 

 

 

483

 

Stock-based compensation expense

 

918

 

 

805

 

 

798

 

Interest Expense

 

 

172

 

 

 

172

 

 

 

186

 

Adjusted EBITDA

$

200

 

$

(346

)

$

(2,203

)

Our management and board of directors use Non-GAAP operating expenses, Non-GAAP net income (loss) and Adjusted EBITDA to understand and evaluate our operating performance and trends, to prepare and approve our annual budget and to develop short-term and long-term operating and financing plans.

 

EVERSPIN TECHNOLOGIES, INC.

Condensed Statement of Cash Flows

(In thousands)

(Unaudited)

 

 

 

Six Months Ended June 30,

 

 

 

2020

 

2019

 

Cash flows from operating activities

 

 

 

 

 

 

 

Net loss

 

$

(3,026

)

 

$

(7,926

)

 

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

 

813

 

 

 

876

 

 

Loss on disposal of property and equipment

 

 

—

 

 

 

20

 

 

Stock-based compensation

 

 

1,723

 

 

 

1,502

 

 

Non-cash gain on warrant revaluation

 

 

7

 

 

 

—

 

 

Non-cash interest expense

 

 

147

 

 

 

153

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts receivable

 

 

(1,540

)

 

 

1,658

 

 

Inventory

 

 

(505

)

 

 

133

 

 

Prepaid expenses and other current assets

 

 

38

 

 

 

200

 

 

Accounts payable

 

 

(776

)

 

 

(456

)

 

Accrued liabilities

 

 

(1,008

)

 

 

(907

)

 

Lease liabilities

 

 

(73

)

 

 

(43

)

 

Net cash used in operating activities

 

 

(4,200

)

 

 

(4,790

)

 

Cash flows from investing activities

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(277

)

 

 

(461

)

 

Net cash used in investing activities

 

 

(277

)

 

 

(461

)

 

Cash flows from financing activities

 

 

 

 

 

 

 

Payments on debt

 

 

—

 

 

 

(3,000

)

 

Payments on finance lease obligation

 

 

(5

)

 

 

(5

)

 

Proceeds from exercise of stock options and purchase of shares in employee stock purchase plan

 

 

827

 

 

 

150

 

 

Proceeds from issuance of common stock in at-the-market offering, net of issuance costs

 

 

2,084

 

 

 

—

 

 

Net cash provided by (used in) financing activities

 

 

2,906

 

 

 

(2,855

)

 

Net decrease in cash and cash equivalents

 

 

(1,571

)

 

 

(8,106

)

 

Cash and cash equivalents at beginning of period

 

 

14,487

 

 

 

23,379

 

 

Cash and cash equivalents at end of period

 

$

12,916

 

 

$

15,273

 

 

Supplementary cash flow information:

 

 

 

 

 

 

 

Interest paid

 

$

197

 

 

$

257

 

 

Operating cash flows paid for operating leases

 

$

862

 

 

$

837

 

 

Financing cash flows paid for finance leases

 

$

5

 

 

$

5

 

 

Non-cash investing and financing activities:

 

 

 

 

 

 

 

Right-of-use assets obtained in exchange for new operating leases

 

$

—

 

 

$

23

 

 

Increase of right-of-use asset and lease liability due to lease modification

 

$

545

 

 

$

—

 

 

Purchase of property and equipment in accounts payable and accrued liabilities

 

$

22

 

 

$

27

 

 

Bonus settled in shares of common stock

 

$

315

 

 

$

—

 

 

 

Company Contact:
Daniel Berenbaum, CFO
T: 480-347-1099
E: daniel.berenbaum@everspin.com

Investor Relations Contact:
Leanne K. Sievers, President
Shelton Group Investor Relations
T: 949-224-3874
E: sheltonir@sheltongroup.com

Source: Everspin Technologies, Inc.