Nlight, Inc 10-Q for FY2020 Q2

Nlight, Inc. (LASR)

10-Q 2020-08-06 For: 2020-06-30

Added on April 09, 2026

About this 10-Q

Nlight, Inc filed this 10-Q on August 6, 2020, covering the quarter ended June 30, 2020 (FY2020 Q2).

Headline figures

Quarter ended June 30, 2020, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $52.14M; up 8.5% from $48.05M a year earlier
Net loss: $6.83M; compared with a net loss of $155K a year earlier
Diluted EPS: -$0.18; compared with $0.00 a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →



Delaware			91-2066376
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)



Title of Each Class	Trading Symbol	Name of Exchange on which Registered
Common Stock, par value $0.0001 per share	LASR	The Nasdaq Stock Market LLC



Large Accelerated Filer	☐	Accelerated Filer	☒	Non-Accelerated Filer	☐	Smaller Reporting Company	☐
						Emerging Growth Company	☒



TABLE OF CONTENTS
	Page

Part I. Financial Information	1
Item 1. Unaudited Interim Financial Statements	1
Consolidated Balance Sheets: June 30, 2020 and December 31, 2019 (unaudited)	1
Consolidated Statements of Operations: Three and Six Months Ended June 30, 2020 and 2019 (unaudited)	2
Consolidated Statements of Comprehensive Income (Loss): Three and Six Months Ended June 30, 2020 and 2019 (unaudited)	3
Consolidated Statements of Stockholders' Equity: Three and Six Months Ended June 30, 2020 and 2019 (unaudited)	4
Consolidated Statements of Cash Flows: Six Months Ended June 30, 2020 and 2019 (unaudited)	6
Notes to Consolidated Financial Statements (unaudited)	7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3. Quantitative and Qualitative Disclosures About Market Risk	26
Item 4. Controls and Procedures	26
Part II. Other Information	26
Item 1. Legal Proceedings	26
Item 1A. Risk Factors	27
Item 6. Exhibits	46
Signatures	48



	As of
	June 30, 2020			December 31, 2019
Assets
Current assets:
Cash and cash equivalents	$	120,899		$	117,252
Accounts receivable, net of allowances of $309 and $269	23,891			27,126
Inventory	50,611			46,131
Prepaid expenses and other current assets	9,883			8,084
Total current assets	205,284			198,593
Property, plant and equipment, net of accumulated depreciation of $61,789 and $58,633	41,349			27,747
Lease right-of-use assets	11,080			—
Intangible assets, net of accumulated amortization of $4,937 and $3,150	8,849			10,006
Goodwill	9,972			9,872
Other assets, net	4,840			3,748
Total assets	$	281,374		$	249,966

Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	20,343		$	12,700
Accrued liabilities	12,179			11,605
Deferred revenues	2,191			679
Lease liabilities	2,480			—
Current portion of long-term debt	5			51
Total current liabilities	37,198			25,035
Non-current income taxes payable	6,656			6,429
Long-term lease liabilities	8,896			—
Long-term debt	15,000			—
Other long-term liabilities	2,299			1,894
Total liabilities	70,049			33,358
Stockholders' equity:
Common stock - $0.0001 par value; 190,000 shares authorized, 38,850 shares issued and outstanding at June 30, 2020 and 38,084 shares issued and outstanding at December 31, 2019	15			15
Additional paid-in capital	345,917			336,732
Accumulated other comprehensive loss	(2,848		)	(2,685		)
Accumulated deficit	(131,759		)	(117,454		)
Total stockholders’ equity	211,325			216,608
Total liabilities and stockholders’ equity	$	281,374		$	249,966



	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
Revenue:
Products	$	45,104		$	48,048		$	82,034		$	89,909
Development	7,034			—			13,319			—
Total revenue	52,138			48,048			95,353			89,909
Cost of revenue:
Products	32,597			32,177			60,497			60,524
Development	6,485			—			12,299			—
Total cost of revenue	39,082			32,177			72,796			60,524
Gross profit	13,056			15,871			22,557			29,385
Operating expenses:
Research and development	9,472			6,494			18,010			12,916
Sales, general, and administrative	9,633			8,572			17,333			16,716
Total operating expenses	19,105			15,066			35,343			29,632
Income (loss) from operations	(6,049		)	805			(12,786		)	(247		)
Other income (expense):
Interest income (expense), net	(65		)	740			218			1,490
Other income (expense), net	(298		)	(907		)	(414		)	(87		)
Income (loss) before income taxes	(6,412		)	638			(12,982		)	1,156
Income tax expense	418			793			1,323			2,546
Net loss	$	(6,830	)	$	(155	)	$	(14,305	)	$	(1,390	)
Net loss per share, basic	$	(0.18	)	$	0.00		$	(0.38	)	$	(0.04	)
Net loss per share, diluted	$	(0.18	)	$	0.00		$	(0.38	)	$	(0.04	)
Shares used in per share calculations:
Basic	38,177			37,065			38,003			36,880
Diluted	38,177			37,065			38,003			36,880



	Three Months Ended June 30, 2020
	Common stock			Additional paid-in capital			Accumulated other comprehensive income (loss)			Accumulated deficit			Total stockholders' equity
	Shares	Amount		Additional paid-in capital			Accumulated other comprehensive income (loss)			Accumulated deficit			Total stockholders' equity
Balance, March 31, 2020	38,473	$	15	$	341,042		$	(3,181	)	$	(124,929	)	$	212,947
Net loss	—	—		—			—			(6,830		)	(6,830		)
Issuance of common stock pursuant to exercise of stock options	145	—		299			—			—			299
Issuance of common stock pursuant to vesting of restricted stock awards and units, net of stock withheld for tax	193	—		(2,146		)	—			—			(2,146		)
Issuance of common stock under the Employee Stock Purchase Plan	39	—		685			—			—			685
Stock-based compensation	—	—		6,037			—			—			6,037
Cumulative translation adjustment	—	—		—			333			—			333
Balance, June 30, 2020	38,850	$	15	$	345,917		$	(2,848	)	$	(131,759	)	$	211,325



	Six Months Ended June 30, 2020
	Common stock			Additional paid-in capital			Accumulated other comprehensive loss			Accumulated deficit			Total stockholders' equity
	Shares	Amount		Additional paid-in capital			Accumulated other comprehensive loss			Accumulated deficit			Total stockholders' equity
Balance, December 31, 2019	38,084	$	15	$	336,732		$	(2,685	)	$	(117,454	)	$	216,608
Net loss	—	—		—			—			(14,305		)	(14,305		)
Issuance of common stock pursuant to exercise of stock options	518	—		857			—			—			857
Issuance of common stock pursuant to vesting of restricted stock awards and units, net of stock withheld for tax	209	—		(2,157		)	—			—			(2,157		)
Issuance of common stock under the Employee Stock Purchase Plan	39	—		685			—			—			685
Stock-based compensation	—	—		9,800			—			—			9,800
Cumulative translation adjustment	—	—		—			(163		)	—			(163		)
Balance, June 30, 2020	38,850	$	15	$	345,917		$	(2,848	)	$	(131,759	)	$	211,325



	Three Months Ended June 30, 2019
	Common stock			Additional paid-in capital			Accumulated other comprehensive income (loss)			Accumulated deficit			Total stockholders' equity
	Shares	Amount		Additional paid-in capital			Accumulated other comprehensive income (loss)			Accumulated deficit			Total stockholders' equity
Balance, March 31, 2019	36,906	$	15	$	326,870		$	(2,417	)	$	(105,805	)	$	218,663
Net loss	—	—		—			—			(155		)	(155		)
Issuance of common stock pursuant to exercise of stock options	317	—		449			—			—			449
Issuance of common stock pursuant to vesting of restricted stock awards and units, net of stock withheld for tax	399	—		(480		)	—			—			(480		)
Issuance of common stock under the Employee Stock Purchase Plan	43	—		762			—			—			762
Stock-based compensation	—	—		2,381			—			—			2,381
Cumulative translation adjustment	—	—		—			317			—			317
Balance, June 30, 2019	37,665	$	15	$	329,982		$	(2,100	)	$	(105,960	)	$	221,937



	Six Months Ended June 30, 2019
	Common stock			Additional paid-in capital			Accumulated other comprehensive income (loss)			Accumulated deficit			Total stockholders' equity
	Shares	Amount		Additional paid-in capital			Accumulated other comprehensive income (loss)			Accumulated deficit			Total stockholders' equity
Balance, December 31, 2018	36,705	$	15	$	324,656		$	(2,157	)	$	(104,731	)	$	217,783
Cumulative effect adjustment due to adoption of ASU 2018-07	—	—		(161		)	—			161			—
Net loss	—	—		—			—			(1,390		)	(1,390		)
Issuance of common stock pursuant to exercise of stock options	518	—		915			—			—			915
Issuance of common stock pursuant to vesting of restricted stock awards and units, net of stock withheld for tax	399	—		(480		)	—			—			(480		)
Issuance of common stock under the Employee Stock Purchase Plan	43	—		762			—			—			762
Stock-based compensation	—	—		4,290			—			—			4,290
Cumulative translation adjustment	—	—		—			57			—			57
Balance, June 30, 2019	37,665	$	15	$	329,982		$	(2,100	)	$	(105,960	)	$	221,937



		Valuation as of						Balances as of
		November 14, 2019			Adjustments			June 30, 2020
Cash		$	33		$	—		$	33
Accounts receivable		635			—			635
Contract assets		456			—			456
Inventory		255			—			255
Other current assets		201			—			201
Property, plant and equipment		1,019			—			1,019
Security deposits		46			—			46
	Tangible assets acquired	2,645			—			2,645

Accounts payable		(278		)	—			(278		)
Other liabilities		(477		)	(100		)	(577		)
Deferred revenue		(141		)	—			(141		)
	Liabilities assumed	(896		)	(100		)	(996		)
	Total tangible assets acquired and liabilities assumed	1,749			(100		)	1,649
Intangible assets		7,200						7,200
Goodwill		8,484			100			8,584
	Net assets acquired	$	17,433		$	—		$	17,433



	Amount		Weighted-Average Useful Life (in years)
Development programs	$	7,200	3.1



		As of
	Balance Sheet Classification	June 30, 2020		December 31, 2019
Contract assets	Prepaid expenses and other current assets	$	2,572	$	2,449
Contract liabilities	Deferred revenue	2,472		881


•	Level 1 Inputs: Observable inputs, such as quoted prices (unadjusted) in active markets for identical assets or liabilities at the measurement date.


•	Level 2 Inputs: Observable inputs, other than Level 1 prices, such as quoted prices in active markets for similar assets and liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.



	Six Months Ended June 30,
	2020			2019
Cash flows from operating activities:
Net loss	$	(14,305	)	$	(1,390	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation	3,614			3,205
Amortization	2,815			1,276
Reduction in carrying amount of right-of-use assets	1,425			—
Provision for losses on accounts receivable	62			33
Stock-based compensation	9,800			4,290
Loss on disposal of assets	—			5
Changes in operating assets and liabilities:
Accounts receivable, net	3,012			(4,334		)
Inventory	(4,457		)	(6,987		)
Prepaid expenses and other current assets	(1,801		)	3,192
Other assets	(2,131		)	(1,800		)
Accounts payable	7,400			1,111
Accrued and other long-term liabilities	1,243			(25		)
Deferred revenues	1,519			(141		)
Lease liabilities	(1,428		)	—
Non-current income taxes payable	234			382
Net cash provided by (used in) operating activities	7,002			(1,183		)
Cash flows from investing activities:
Purchases of property, plant and equipment	(17,040		)	(6,110		)
Capitalization of patents	(628		)	(806		)
Net cash used in investing activities	(17,668		)	(6,916		)
Cash flows from financing activities:
Proceeds from debt financing	15,000			—
Principal payments on debt and financing leases	(45		)	(50		)
Proceeds from employee stock plan purchases	685			762
Proceeds from stock option exercises	857			915
Tax payments related to stock award issuances	(2,157		)	(480		)
Net cash provided by financing activities	14,340			1,147
Effect of exchange rate changes on cash	(27		)	135
Net increase (decrease) in cash and cash equivalents	3,647			(6,817		)
Cash and cash equivalents, beginning of period	117,252			149,478
Cash and cash equivalents, end of period	$	120,899		$	142,661
Supplemental disclosures:



	Three Months Ended June 30,		Six Months Ended June 30,
	2020	2019	2020	2019
Quick Laser Technology Co., Ltd.	15%	10%	12%	*
U.S. Government	12%	*	11%	*
Raytheon Technologies	11%	*	13%	10%



	As of
	June 30, 2020		December 31, 2019
Raw materials	$	18,923	$	16,643
Work in process and semi-finished goods	19,580		17,723
Finished goods	12,108		11,765
	$	50,611	$	46,131



		As of
	Useful life (years)	June 30, 2020			December 31, 2019
Computer hardware and software	3-5	$	5,055		$	4,764
Manufacturing and lab equipment	2-7	63,107			59,395
Office equipment and furniture	5-7	1,330			1,462
Leasehold improvements	2-12	20,910			20,759
Buildings	30	9,337			—
Land	N/A	3,399			—
		103,138			86,380
Accumulated depreciation		(61,789		)	(58,633		)
		$	41,349		$	27,747


•	Level 3 Inputs: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.



	June 30, 2020
	Level 1		Level 2		Level 3		Total
Money market securities	$	74,074	$	—	$	—	$	74,074
Commercial paper	4,168		—		—		4,168
Total	$	78,242	$	—	$	—	$	78,242



				As of
	Estimated useful life (in years)			June 30, 2020			December 31, 2019
Patents	3	-	5	$	6,586		$	5,956
Development programs	2	-	4	7,200			7,200
				13,786			13,156
Accumulated amortization				(4,937		)	(3,150		)
				$	8,849		$	10,006



	Laser Products		Advanced Development		Totals
Balance, December 31, 2019	$	1,387	$	8,484	$	9,872
Purchase price adjustment	—		100		100
Balance, June 30, 2020	$	1,387	$	8,584	$	9,972



		Three Months Ended June 30, 2020		Six Months Ended June 30, 2020
Lease expense:
	Operating lease expense	$	651	$	1,420
	Short-term lease expense	31		118
	Variable and other lease expense	107		253
		$	789	$	1,791



Remainder of 2020	$	1,582
2021	2,366
2022	1,711
2023	1,163
2024	1,105
Thereafter	5,582
	$	13,509



		Number of Restricted Stock Awards		Weighted-Average Grant Date Fair Value
RSAs at December 31, 2019		459		$	20.49
	Awards granted	—		—
	Awards vested	(72	)	21.40
	Awards forfeited and modified	—		—
RSAs at June 30, 2020		387		$	20.32



		Number of Restricted Stock Units		Weighted-Average Grant Date Fair Value
RSUs at December 31, 2019		2,407		$	19.47
	Awards granted	99		14.28
	Awards vested	(293	)	22.53
	Awards forfeited & modified	(53	)	19.29
RSUs at June 30, 2020		2,160		$	18.81



	Number of Options		Weighted Average Exercise Price	Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding, December 31, 2019	4,239		$1.54	6.1	$79,443
Options exercised	(518	)	$1.65
Options canceled	(10	)	$1.16
Outstanding, June 30, 2020	3,711		$1.53	5.7	$76,948
Options exercisable at June 30, 2020	2,871		$1.04	5.4	$60,906
Options vested as of June 30, 2020 and expected to vest after June 30, 2020	3,711		$1.53	5.7	$76,948



	Six Months Ended June 30, 2020
Shares issued	39
Weighted-average per share purchase price	$	17.53
Weighted-average per share discount from the fair value of the Company's common stock on date of issuance	$	3.85



Remainder of 2020	$	9,086
2021	15,164
2022	11,001
2023	5,623
2024	20
	$	40,894



	Three Months Ended June 30,								Change
	2020		% of Revenue		2019		% of Revenue		$			%
Laser Products	$	45,104	86.5	%	$	48,048	100.0	%	$	(2,944	)	(6.1	)%
Advanced Development	7,034		13.5		—		—		7,034			NM
	$	52,138	100.0	%	$	48,048	100.0	%	$	4,090		8.5	%


•	cease the manufacture, use or sale of the infringing products, processes or technology;


•	expend significant resources to develop non-infringing products, processes or technology;


•	license technology from the party claiming infringement, which license may not be available on commercially reasonable terms, or at all;


•	cross-license our technology to a competitor to resolve an infringement claim, which could weaken our ability to compete with that competitor; or


•	pay substantial damages to our direct or indirect customers to cause our end users to discontinue their use of, or replace, infringing products with non-infringing products.


•	the increase, decrease, cancellation or rescheduling of significant customer orders;


•	the impact of the COVID-19 pandemic and other public health crises, including on macroeconomic conditions and our business, results of operations and financial condition;


•	government-mandated quarantines or closures applicable to our facilities or the facilities of our customers or suppliers;