8-K
IMMERSION CORP (IMMR)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
August 20, 2024 ****
Date of Report (Date of earliest event reported)
IMMERSION CORPORATION
(Exact name of Registrant as specified in its charter)
| Delaware | 001-38334 | 94-3180138 |
|---|---|---|
| (State or other jurisdiction<br><br><br>of incorporation) | (Commission<br><br><br>file number) | (I.R.S. Employer<br><br><br>Identification No.) |
2999 N.E. 191st Street, Suite 610 , Aventura
, FL 33180
(Address of principal executive offices and zip code)
(408) 467-1900
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8‑K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.001 par value per share | IMMR | The Nasdaq Global Market |
| Series B Junior Participating Preferred Stock Purchase Rights | IMMR | The Nasdaq Global Market |
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 ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02
Results of Operations and Financial Condition.
On August 20, 2024, Immersion Corporation (“we”, “our” or the “Company”) issued a press release regarding financial results for the second quarter ended June 30, 2024. A copy of the press release is attached to this Current Report as Exhibit 99.1, and the information in Exhibit 99.1 is incorporated herein by reference.
The information in Item 2.02 and Exhibit 99.1 in this Current Report on Form 8-K shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act.
Item 8.01 Other Events.
On August 20, 2024, the Company announced that its Board of Directors (the “Board”) declared a quarterly dividend. The quarterly dividend, in the amount of $0.045 per share, will be payable, subject to any prior revocation, on October 18, 2024 to stockholders' of record on October 4, 2024. Future dividends will be subject to further review and approval by the Board in accordance with applicable law. The Board reserves the right to adjust or withdraw the quarterly dividend in future periods as it reviews the Company’s capital allocation strategy from time-to-time.
Forward Looking Statements
This Item 8.01 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, including statements regarding the Company’s dividend program. These forward-looking statements are subject to and involve risks and uncertainties. These forward-looking statements may be identified by terms such as “will,” “may,” “plans,” or the negative of these terms, and similar expressions intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding the anticipated amount, duration, methods, timing and other aspects of our dividend program and any anticipated benefits or value resulting from any such dividends. These statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, any unforeseen need for capital which may require us to divert funds we may have otherwise used for the dividend program, which may in turn negatively impact our ability to administer the quarterly dividends. In addition, the timing and amount of future dividends, if any, will be made as management deems appropriate and will depend on a variety of factors including stock price, market conditions, corporate and regulatory requirements (including applicable securities laws and regulations and the rules of the Nasdaq Stock Market), any additional constraints related to material inside information the Company may possess, and capital availability. More information regarding these and other risks, uncertainties and factors is contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC, Barnes & Noble Education, Inc.’s Annual Report on Form 10-K for the fiscal year ended April 27, 2024, the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, as filed with the SEC, and in other reports filed by the Company and Barnes & Noble Education, Inc. with the SEC from time to time. You are cautioned not to unduly rely on these forward-looking statements, which speak only as of the date of this Form 8-K. All information in this Form 8-K is as of the date stated and unless required by law, the Company undertakes no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this Form 8-K or to report the occurrence of unanticipated events other than as required by law or regulation.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Exhibit Title |
|---|---|
| 99.1 | Press Release dated August 20, 2024 (regarding financial results for second quarter ended June 30, 2024) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| IMMERSION CORPORATION | |||
|---|---|---|---|
| Date: | August 20, 2024 | By: | /s/ J. MICHAEL DODSON |
| Name: | J. Michael Dodson | ||
| Title: | Chief Financial Officer |
Exhibit 99.1
Immersion Corporation Reports Second Quarter 2024 Results
GAAP Net Income Attributable to Immersion stockholders of $28.9 million or $0.89 per diluted share
Non-GAAP Net Income Attributable to Immersion stockholders of $37.0 million or $1.14 per diluted share
**AVENTURA FL, August 20, 2024 –**Immersion Corporation (“Immersion”, the “Company”, “we”, “us” or “our”) (Nasdaq: IMMR), a leading provider of technologies for haptics, today reported financial results for the second quarter ended June 30, 2024.
Second Quarter Consolidated Financial Summary^1^:
| • | Total revenues of $99.4 million in the second quarter of 2024, compared to $7.0 million in the second quarter of 2023. |
|---|---|
| • | GAAP net income attributable to Immersion Corporation stockholders was $28.9 million, or $0.89 per diluted share in the second quarter of 2024, compared to $7.0 million, or $0.21 per diluted share, in the second quarter of 2023. |
| • | GAAP operating expenses of $33.2 million in the second quarter of 2024, compared to $3.9 million in the second quarter of 2023. Non-GAAP operating expenses of $25.2 million in the second quarter of 2024, compared to $2.5 million in the second quarter of 2023. |
| • | Non-GAAP net income attributable to Immersion Corporation stockholders was $37.0 million, or $1.14 per diluted share, in the second quarter of 2024 compared to $8.4 million, or $0.26 per diluted share, in the second quarter of 2023. |
| • | Total stockholders' equity attributable to Immersion Corporation stockholders was $230.3 million compared to $183.1 million as of December 31, 2023. |
Second Quarter Immersion Corporation Segment Standalone Financial Summary:
| • | Immersion Corporation royalty and license revenue was $52.4 million in the second quarter of 2024, compared to $7.0 million in the second quarter of 2023. |
|---|---|
| • | Immersion Corporation standalone Non-GAAP stockholders’ equity increased $53.0 million to $236.1 million as of June 30, 2024 compared to $183.1 million as of December 31, 2023. |
^1^ On June 10, 2024, the Company closed certain transactions with Barnes & Noble Education, Inc. (“Barnes & Noble Education”). As part of the transactions, the Company acquired 42% of all outstanding common shares of Barnes & Noble Education, as well as control over Barnes & Noble Education through the five Immersion-appointed board seats. The financial information presented in the press release includes the consolidated financial information of Barnes & Noble Education from the period of June 10, 2024 through June 30, 2024. The Company owns approximately 11 million shares of Barnes & Noble Education's common stock upon the close of this transaction.
“The second quarter was very strong for the Company,” said Eric Singer, Chairman and CEO. “We continue to work to protect and monetize our intellectual property. We were also able to take advantage of our strong and liquid balance sheet to make an important investment in Barnes & Noble Education (NYSE: BNED). Notably, Immersion standalone Non-GAAP stockholders equity has increased by more than $50 million so far in 2024 to $236.1 million as of June 30, 2024. We will continue to seek to drive long-term shareholder value from a position of strength and through thoughtful capital allocation,” added Singer.
The ninth quarterly dividend, in the amount of $0.045 per share, will be paid on October18, 2024 to stockholders of record on October 4, 2024. Future quarterly dividends will be subject to further review and approval by the Board of Directors (the “Board”) in accordance with applicable law. The Board reserves the right to adjust or withdraw the quarterly dividend in future periods as it reviews the Company’s capital allocation strategy from time-to-time.
About Immersion Corporation
Immersion Corporation (Nasdaq: IMMR) was incorporated in 1993 in California and reincorporated in Delaware in 1999.
The Company is a leading provider of touch feedback technology, also known as haptics. The Company accelerates and scales haptic experiences by providing haptic technology for mobile, automotive, gaming, and consumer electronics. Haptic technology creates immersive and realistic experiences that enhance digital interactions by engaging users’ sense of touch. Learn more at www.immersion.com.
^2^See Reconciliation of GAAP total stockholders’ equity attributable to Immersion Corporation Stockholders to Immersion standalone Non GAAP stockholders’ equity for more detail.
Use of Non-GAAP Financial Measures
The Company reports all financial information required in accordance with generally accepted accounting principles (“GAAP”), but it believes that evaluating its ongoing operating results may be difficult to understand if limited to reviewing only GAAP financial measures. The Company discloses certain non-GAAP information, such as Non-GAAP net income attributable to Immersion stockholders, Non-GAAP net income per diluted common share attributable to Immersion stockholders, Non-GAAP operating expenses, Immersion standalone Non-GAAP stockholders’ equity because it is useful in understanding the Company’s performance as it excludes certain non-cash expenses like stock-based compensation expense, depreciation and amortization of property and equipment, restructuring expense, business acquisition related costs and other nonrecurring charges that many investors feel may obscure the Company’s true operating performance. Likewise, management uses these non-GAAP financial measures to manage and assess the profitability of its business. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP. The non-GAAP financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release.
Forward-looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The forward-looking statements involve risks and uncertainties. Forward-looking statements are identified by words such as “anticipates,” “believes,” “expects,” “intends,” “may,” “can,” “will,” “places,” “estimates,” and other similar expressions. However, these words are not the only way we identify forward-looking statements. Examples of forward-looking statements include any expectations, projections, or other characterizations of future events, or circumstances, including but not limited to statements about the Company’s focus on protecting its intellectual property, either through the execution of new or renewal license agreements or by proactive enforcement continuing to pursue thoughtful capital allocation to increase long-term stockholder value, and the timing of any dividend payments.
Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Actual results could differ materially from those projected in the forward-looking statements, therefore we caution you not to place undue reliance on these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: the inability to predict the outcome of any litigation, the costs associated with any litigation and the risks related to our business, both direct and indirect, of initiating litigation, unanticipated changes in the markets in which the Company operates; the effects of the current macroeconomic climate; delay in or failure to achieve adoption of or commercial demand for the Company’s products or third party products incorporating the Company’s technologies; the inability of Immersion to renew existing licensing arrangements, or enter into new licensing arrangements on favorable terms; the loss of a major customer; the ability of
Immersion to protect and enforce its intellectual property rights and other factors. For a more detailed discussion of these factors, and other factors that could cause actual results to vary materially, interested parties should review the risk factors listed in Immersion’s Annual Report on Form 10-K for 2023 as filed with the U.S. Securities and Exchange Commission (the “SEC”), Barnes & Noble Education’s Inc.'s Annual Report on Form 10-K for its fiscal year ended April 27, 2024, as filed with the SEC, and Immersion’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, as filed with the SEC. Any forward-looking statements made by us in this press release speak only as of the date of this press release, and the Company does not intend to update these forward-looking statements after the date of this press release, except as required by law.
Immersion, and the Immersion logo are trademarks of Immersion Corporation in the United States and other countries. All other trademarks are the property of their respective owners. The use of the word “partner” or “partnership” in this press release does not mean a legal partner or legal partnership.
(IMMR – C)
Immersion Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
| June 30, 2024 | December 31, 2023 | |||
|---|---|---|---|---|
| ASSETS | ||||
| Current assets | ||||
| Immersion | ||||
| Cash and cash equivalents | $ | 28,932 | $ | 56,071 |
| Investments - current | 97,614 | 104,291 | ||
| Accounts receivable, net | 18,235 | 2,241 | ||
| Prepaid expenses and other current assets | 8,647 | 9,847 | ||
| 153,428 | 172,450 | |||
| Barnes & Noble Education | ||||
| Cash and cash equivalents | 6,855 | — | ||
| Accounts receivable, net | 122,797 | — | ||
| Merchandise inventories, net | 353,454 | — | ||
| Textbook rental Inventories, net | 9,288 | — | ||
| Prepaid expenses and other current assets | 32,819 | — | ||
| 525,213 | — | |||
| Total current assets | 678,641 | 172,450 | ||
| Immersion | ||||
| Property and equipment, net | 166 | 211 | ||
| Investments - noncurrent | 45,163 | 33,350 | ||
| Long-term deposits | 6,310 | 6,231 | ||
| Deferred tax assets | 3,343 | 3,343 | ||
| Other assets - noncurrent | 33,775 | 146 | ||
| 88,757 | 43,281 | |||
| Barnes & Noble Education | ||||
| Property and equipment, net | 117,808 | — | ||
| Intangible assets, net | 94,786 | — | ||
| Goodwill | 14,220 | — | ||
| Operating lease right-of-use assets | 182,292 | — | ||
| Other assets - noncurrent | 11,162 | — | ||
| 420,268 | — | |||
| Total assets | $ | 1,187,666 | $ | 215,731 |
Immersion Corporation
Condensed Consolidated Balance Sheets (Continued)
(In thousands)
(Unaudited)
| June 30, 2024 | December 31, 2023 | |||
|---|---|---|---|---|
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
| Current liabilities | ||||
| Immersion | ||||
| Accounts payable | $ | 81 | $ | 47 |
| Accrued compensation | 2,850 | 3,127 | ||
| Deferred revenue - current | 12,082 | 4,239 | ||
| Other current liabilities | 27,605 | 11,900 | ||
| 42,618 | 19,313 | |||
| Barnes & Noble Education | ||||
| Accounts payable | 217,173 | — | ||
| Accrued liabilities | 69,638 | — | ||
| Deferred revenue - current | 8,159 | — | ||
| Operating lease liabilities - current | 100,221 | — | ||
| 395,191 | — | |||
| Total current liabilities | 437,809 | 19,313 | ||
| Immersion | ||||
| Deferred revenue - noncurrent | 8,665 | 8,390 | ||
| Other long-term liabilities | 4,959 | 4,926 | ||
| 13,624 | 13,316 | |||
| Barnes & Noble Education | ||||
| Deferred tax liabilities - noncurrent | 636 | — | ||
| Operating lease - noncurrent | 107,400 | — | ||
| Other long-term liabilities | 12,240 | — | ||
| Deferred revenue - noncurrent | 3,393 | — | ||
| Long-term borrowings | 186,644 | — | ||
| 310,313 | — | |||
| Total liabilities | 761,746 | 32,629 | ||
| Total stockholders' equity attributable to Immersion Corporation stockholders | 230,272 | 183,102 | ||
| Noncontrolling interest in consolidated subsidiaries | 195,648 | — | ||
| Total stockholders' equity | 425,920 | 183,102 | ||
| Total liabilities and stockholders' equity | $ | 1,187,666 | $ | 215,731 |
Immersion Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended<br><br><br>June 30, | Six Months Ended<br><br><br>June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Revenues: | ||||||||||||
| Immersion | ||||||||||||
| Royalty and license | $ | 52,403 | $ | 6,983 | $ | 96,250 | $ | 14,057 | ||||
| Barnes & Noble Education | ||||||||||||
| Product and other | 45,073 | — | 45,073 | — | ||||||||
| Rental income | 1,948 | — | 1,948 | — | ||||||||
| Total revenues | 99,424 | 6,983 | 143,271 | 14,057 | ||||||||
| Cost of sale (excludes depreciation and amortization expense): | ||||||||||||
| Barnes & Noble Education | ||||||||||||
| Product and other | 39,675 | — | 39,675 | — | ||||||||
| Rental income | 1,131 | — | 1,131 | — | ||||||||
| 40,806 | — | 40,806 | — | |||||||||
| Operating expenses: | ||||||||||||
| Immersion | ||||||||||||
| Selling and administrative expenses | 14,175 | 3,870 | 41,408 | 7,685 | ||||||||
| Barnes & Noble Education | ||||||||||||
| Selling and administrative expenses | 14,519 | — | 14,519 | — | ||||||||
| Depreciation and amortization expense | 2,140 | — | 2,140 | |||||||||
| Restructuring and other charges | 2,378 | — | 2,378 | — | ||||||||
| 19,037 | — | 19,037 | — | |||||||||
| Total operating expenses | 33,212 | 3,870 | 60,445 | 7,685 | ||||||||
| Operating income | 25,406 | 3,113 | 42,020 | 6,372 | ||||||||
| Interest and other income (loss), net | 4,609 | 6,759 | 12,715 | 13,285 | ||||||||
| Interest expense | (901 | ) | — | (901 | ) | — | ||||||
| Income before provision for income taxes | 29,114 | 9,872 | 53,834 | 19,657 | ||||||||
| Provision for income taxes | (8,178 | ) | (2,844 | ) | (14,243 | ) | (4,351 | ) | ||||
| Net income | $ | 20,936 | $ | 7,028 | $ | 39,591 | $ | 15,306 | ||||
| Net loss attributable to noncontrolling interest | (8,009 | ) | — | (8,009 | ) | — | ||||||
| Net income attributable to Immersion stockholders | $ | 28,945 | $ | 7,028 | $ | 47,600 | $ | 15,306 | ||||
| Diluted income per common share attributable to Immersion stockholders | $ | 0.89 | $ | 0.21 | $ | 1.47 | $ | 0.47 | ||||
| Shares used in calculating diluted net income per share | 32,525 | 32,810 | 32,407 | 32,839 |
Immersion Corporation
Reconciliation of GAAP net income attributable to Immersion stockholders to Non-GAAP net income attributable to Immersion stockholders
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended<br><br><br>June 30, | Six Months Ended<br><br><br>June 30, | |||||||
|---|---|---|---|---|---|---|---|---|
| 2024 | 2023^1^ | 2024 | 2023^1^ | |||||
| GAAP net income attributable to Immersion stockholders | $ | 28,945 | $ | 7,028 | $ | 47,600 | $ | 15,306 |
| Add: Stock-based compensation | 1,192 | 760 | 2,268 | 1,707 | ||||
| Depreciation and amortization of property and equipment | 2,155 | 21 | 2,173 | 42 | ||||
| Restructuring expense and other charges | 2,407 | 125 | 2,438 | 312 | ||||
| Business acquisition related costs | 2,283 | — | 2,283 | — | ||||
| Other nonrecurring charges | 10 | 481 | 53 | 560 | ||||
| Non-GAAP net income attributable to Immersion stockholders | $ | 36,992 | $ | 8,415 | $ | 56,815 | $ | 17,927 |
| Non-GAAP net income per diluted common share attributable to Immersion stockholder | $ | 1.14 | $ | 0.26 | $ | 1.75 | $ | 0.55 |
| Shares used in calculating Non-GAAP net income per diluted share attributable to Immersion stockholder | 32,525 | 32,810 | 32,407 | 32,839 |
^1^ In order to provide for better comparability between periods and a better understanding of underlying trends. The Non-GAAP information above includes an updated presentation of the prior year 2023.
Immersion Corporation
Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses
(In thousands)
(Unaudited)
| Three Months Ended<br><br><br>June 30, | Six Months Ended<br><br><br>June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |||||||||
| GAAP operating expenses | $ | 33,212 | $ | 3,870 | $ | 60,445 | $ | 7,685 | ||||
| Adjustments to GAAP operating expenses: | ||||||||||||
| Stock-based compensation expense | (1,192 | ) | (760 | ) | (2,268 | ) | (1,707 | ) | ||||
| Depreciation and amortization expense of property and equipment | (2,155 | ) | (21 | ) | (2,173 | ) | (42 | ) | ||||
| Restructuring expense charges | (2,407 | ) | (125 | ) | (2,438 | ) | (312 | ) | ||||
| Business acquisition related costs | (2,283 | ) | — | (2,283 | ) | — | ||||||
| Other nonrecurring charges | (10 | ) | (481 | ) | (53 | ) | (560 | ) | ||||
| Non-GAAP operating expenses | $ | 25,165 | $ | 2,483 | $ | 51,230 | $ | 5,064 |
Immersion Corporation
Reconciliation of GAAP Total stockholders’ equity attributable to Immersion Corporation Stockholders to
Non-GAAP Immersion standalone Non-GAAP stockholders’ equity
(In thousands)
(Unaudited)
| June 30, 2024 | December 31, 2023 | |||
|---|---|---|---|---|
| Total stockholders’ equity attributable to Immersion Corporation stockholders | $ | 230,272 | $ | 183,102 |
| Adjusted for Barnes & Noble Education's net loss attributable to Immersion stockholders | 5,800 | — | ||
| Immersion standalone Non-GAAP stockholders' equity | $ | 236,072 | $ | 183,102 |
Investor Contact:
J. Michael Dodson
Immersion Corporation
mdodson@immersion.com