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Everspin Reports Third Quarter 2019 Financial Results
[November 07, 2019]

Everspin Reports Third Quarter 2019 Financial Results


Everspin Technologies, Inc. (Nasdaq: MRAM), the market leader in MRAM, today announced financial results for the third quarter ended September 30, 2019.

Third Quarter and Recent Highlights

  • Total revenue was $9.2 million, up 6% sequentially and above the high-end of guidance
  • Achieved record STT-MRAM revenue, which included both 256Mb and 1Gb devices
  • Signed IP assignment and cross-licensing agreement with Seagate Technology, demonstrating the strength of its MRAM intellectual property portfolio
  • Expanded Toggle product portfolio with additional densities targeting new market applications
  • Reduced cash used for operations to $770,000 from $1.8 million in the prior quarter

"Revenue in the quarter was above the high-end of our guidance range, driven by record revenue from our STT-MRAM products combined with a return to growth for our Toggle products," stated Kevin Conley, Everspin's President and CEO. "Furthermore, our ongoing focus on closely managing expenses and cash utilization have contributed to continued improvements in our operating results and positions us to benefit from increased leverage as revenue grows.

"Also during the quarter, we made further progress on customer qualifications for our 1Gb STT-MRAM device, while continuing to gain traction on our efforts toward advancing the MRAM ecosystem with enterprise storage controller companies. Looking forward, our priority remains on growing our design win pipeline and targeting new opportunities in secular growth markets with an expanded product portfolio based on both Toggle and STT-MRAM technologies."

Third Quarter 2019 Results

Total revenue for the third quarter of 2019 was $9.2 million, compared to $11.5 million in the third quarter of 2018 and $8.6 million in the previous quarter.

Gross margin for the third quarter of 2019 was 47.4%, and compares to 47.0% in the third quarter of 2018 and 46.5% in the previous quarter.

Operating expenses for the third quarter of 2019 were $7.9 million, compared to the $10.9 million in the year-ago quarter and $7.6 million in the previous quarter.

Net loss for the third quarter of 2019 was $3.7 million, or ($0.21) per share, based on 17.3 million weighted-average shares outstanding, compared to a net loss of $5.6 million, or ($0.33) per share, in the third quarter of 2018, and a net loss of $3.7 million, or ($0.21) per share, in the second quarter of 2019.

Cash and cash equivalents as of September 30, 2019 were $14.8 million, compared to $15.3 million at the end of the second quarter of 2019. During the quarter, the Company issued new shares through its at-the-market equity facility, resulting in net proceeds $2.2 million.

Business Outlook

For the fourth quarter of 2019, Everspin expects total revenue in the range of $9.3 million and $9.7 million. Net loss per share is expected to be between ($0.18) and ($0.14) based on a weighted-average share count of 17.4 million shares outstanding.

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 3075878. 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 November 14, 2019. The replay can be accessed by dialing 1-855-859-2056 and using the passcode 3075878. International callers should dial +1-404-537-3406 and enter the same passcode at the prompt.

About Everspin Technologies

Headquartered in Chandler, Arizona, Everspin Technologies, Inc. is the worldwide leader in the design, volume production and distribution of Magnetoresistive RAM (MRAM) into markets and applications where data persistence, performance, and endurance are paramount. Serving applications across the data center, industrial, and transportation markets, Everspin has built the strongest and fastest-growing foundation of MRAM users in the world. For more information, visit www.everspin.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements regarding future events 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-Q filed with the Securities and Exchange Commission on August 7, 2019, 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)

 

 

September 30,

 

December 31,

 

 

2019

 

2018

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

14,780

 

 

$

23,379

 

Accounts receivable, net

 

 

5,568

 

 

 

7,522

 

Inventory

 

 

8,318

 

 

 

9,097

 

Prepaid expenses and other current assets

 

 

222

 

 

 

688

 

Total current assets

 

 

28,888

 

 

 

40,686

 

Property and equipment, net

 

 

3,558

 

 

 

4,286

 

Right-of-use assets

 

 

2,595

 

 

 

-

 

Other assets

 

 

73

 

 

 

73

 

Total assets

 

$

35,114

 

 

$

45,045

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

3,178

 

 

$

2,637

 

Accrued liabilities

 

 

3,167

 

 

 

5,001

 

Current portion of long-term debt

 

 

72

 

 

 

5,977

 

Operating lease liabilities

 

 

1,606

 

 

 

-

 

Other liabilities

 

 

48

 

 

 

-

 

Total current liabilities

 

 

8,071

 

 

 

13,615

 

Long-term debt, net of current portion

 

 

7,676

 

 

 

6,509

 

Operating lease liabilities, net of current portion

 

 

1,307

 

 

 

-

 

Total liabilities

 

 

17,054

 

 

 

20,124

 

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 September 30, 2019 and December 31, 2018

 

 

-

 

 

 

-

 

Common stock, $0.0001 par value per share; 100,000,000 shares authorized; 17,535,746 and 17,095,456 shares issued and outstanding as of September 30, 2019 and December 31, 2018

 

 

2

 

 

 

2

 

Additional paid-in capital

 

 

163,640

 

 

 

158,912

 

Accumulated deficit

 

 

(145,582

)

 

 

(133,993

)

Total stockholders' equity

 

 

18,060

 

 

 

24,921

Total liabilities and stockholders' equity

$

35,114

 

 

$

45,045


EVERSPIN TECHNOLOGIES, INC.

Condensed Statements of Operations and Comprehensive Loss

(In thousands, except share and per share amounts)

(Unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

Product sales

 

$

8,370

 

 

$

10,469

 

 

$

25,396

 

 

$

29,283

 

Licensing, royalty, and other revenue

 

 

808

 

 

 

1,049

 

 

 

2,454

 

 

 

7,853

 

Total revenue

 

 

9,178

 

 

 

11,518

 

 

 

27,850

 

 

 

37,136

 

Cost of sales

 

 

4,824

 

 

 

6,109

 

 

 

14,692

 

 

 

17,235

 

Gross profit

 

 

4,354

 

 

 

5,409

 

 

 

13,158

 

 

 

19,901

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

3,395

 

 

 

6,453

 

 

 

10,912

 

 

 

19,706

 

General and administrative

 

 

3,050

 

 

 

2,913

 

 

 

9,501

 

 

 

9,461

 

Sales and marketing

 

 

1,491

 

 

 

1,582

 

 

 

4,094

 

 

 

4,661

 

Total operating expenses

 

 

7,936

 

 

 

10,948

 

 

 

24,507

 

 

 

33,828

 

Loss from operations

 

 

(3,582

)

 

 

(5,539

)

 

 

(11,349

)

 

 

(13,927

)

Interest expense

 

 

(170

)

 

 

(229

)

 

 

(567

)

 

 

(662

)

Other income, net

 

 

89

 

 

 

139

 

 

 

327

 

 

 

315

 

Net loss and comprehensive loss

 

$

(3,663

)

 

$

(5,629

)

 

$

(11,589

)

 

$

(14,274

)

Net loss per common share, basic and diluted

 

$

(0.21

)

 

$

(0.33

)

 

$

(0.67

)

 

$

(0.88

)

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

 

 

17,312,226

 

 

 

16,944,660

 

 

 

17,183,306

 

 

 

16,130,882

 

EVERSPIN TECHNOLOGIES, INC.

Condensed Statement of Cash Flows

(In thousands)

(Unaudited)

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2019

 

2018

 

Cash flows from operating activities

 

 

 

 

 

 

 

Net loss

 

$

(11,589

)

 

$

(14,274

)

 

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

 

 

 

 

 

 

 

Depreciation and amortization

 

 

1,297

 

 

 

1,069

 

 

Loss on disposal of property and equipment

 

 

20

 

 

 

19

 

 

Stock-based compensation

 

 

2,397

 

 

 

2,064

 

 

Non-cash interest expense

 

 

219

 

 

 

286

 

 

Compensation expense related to vesting of common stock to GLOBALFOUNDRIES

 

 

-

 

 

 

709

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts receivable

 

 

1,954

 

 

 

(1,876

)

 

Inventory

 

 

779

 

 

 

309

 

 

Prepaid expenses and other current assets

 

 

466

 

 

 

154

 

 

Accounts payable

 

 

518

 

 

 

(140

)

 

Accrued liabilities

 

 

(1,444

)

 

 

4,840

 

 

Operating lease liabilities

 

 

(72

)

 

 

-

 

 

Shipping term reversal

 

 

-

 

 

 

(39

)

 

Net cash used in operating activities

 

 

(5,455

)

 

 

(6,879

)

 

Cash flows from investing activities

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(566

)

 

 

(1,513

)

 

Net cash used in investing activities

 

 

(566

)

 

 

(1,513

)

 

Cash flows from financing activities

 

 

 

 

 

 

 

Proceeds from the issuance of common stock, net of offering costs

 

 

-

 

 

 

24,524

 

 

Proceeds from debt

 

 

-

 

 

 

1,000

 

 

Payments on debt

 

 

(4,840

)

 

 

(1,000

)

 

Payments of debt issuance costs

 

 

(80

)

 

 

-

 

 

Payments on finance lease obligation

 

 

(8

)

 

 

(8

)

 

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

 

 

178

 

 

 

2,364

 

 

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

 

 

2,172

 

 

 

-

 

 

Net cash (used in) provided by financing activities

 

 

(2,578

)

 

 

26,880

 

 

Net (decrease) increase in cash and cash equivalents

 

 

(8,599

)

 

 

18,488

 

 

Cash and cash equivalents at beginning of period

 

 

23,379

 

 

 

12,950

 

 

Cash and cash equivalents at end of period

 

$

14,780

 

 

$

31,438

 

 

Supplementary cash flow information:

 

 

 

 

 

 

 

Interest paid

 

$

373

 

 

$

370

 

 

Operating cash flows paid for operating leases

 

$

1,264

 

 

$

-

 

 

Financing cash flows paid for finance leases

 

$

8

 

 

$

-

 

 

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

 

$

23

 

 

$

-

 

 

Non-cash investing and financing activities:

 

 

 

 

 

 

 

Purchases of property and equipment in accounts payable

 

$

33

 

 

$

183

 

 

Modification of warrant

 

$

36

 

 

$

-

 

 

Issuance of warrant with debt

 

$

-

 

 

$

43

 

 

 


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