8-K
EVERSPIN TECHNOLOGIES INC. (MRAM)
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
Date of Report (Date of earliest event reported): May 7, 2020
Everspin Technologies, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 001-37900 | 26-2640654 |
|---|---|---|
| (State or other jurisdiction<br><br> <br>of incorporation) | (Commission<br><br> <br>File Number) | (IRS Employer<br><br> <br>Identification No.) |
5670 W. Chandler Blvd.
Suite 100
Chandler, Arizona 85226
(Address of principal executive offices, including zip code)
(480) 347-1111
(Registrant’s telephone number, including area code)
Not Applicable
(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 obligation of the registrant under any of the following provisions:
| ☐ | 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, par value $0.0001 | MRAM | The Nasdaq Stock 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 May 7, 2020, the Company issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
| Exhibit No. | Description |
|---|---|
| 99.1 | Press release dated May 7, 2020. |
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.
| Everspin Technologies, Inc. | ||
|---|---|---|
| Dated: May 7, 2020 | ||
| By: | /s/ Matt Tenorio | |
| Matt Tenorio | ||
| Interim Chief Financial Officer |
Exhibit 99.1
Everspin Reports First Quarter 2020 Financial Results
Revenue Above High-End of Guidance with Significant Improvement in EPS; Guides 19% Revenue Growth for 2Q at the Midpoint
CHANDLER, Ariz.--(BUSINESS WIRE)--May 7, 2020--Everspin Technologies, Inc. (NASDAQ: MRAM), the market leader in MRAM, today announced financial results for the first quarter ended March 31, 2020.
First Quarter and Recent Highlights
- Total revenue increased sequentially and year-over-year to $10.1 million, exceeding the high-end of guidance
- Gross margin expanded to 52.9% from 47.7% in the prior year quarter
- GAAP loss improved to ($0.10) per share and non-GAAP loss to ($0.05), compared to ($0.25) and ($0.21), respectively, in year-ago quarter
- Ended quarter with cash and equivalents of $14.0 million
“First quarter revenue was above the high end of our guidance range and represented our third consecutive quarter of growth as data center demand combined with the breadth of our customer base continue to be positive factors for our business,” stated Kevin Conley, Everspin’s President and CEO. “Additionally, our expense reduction initiatives and ongoing improvement in mature product costs resulted in a dramatic increase in year-over-year bottom-line results.
“Despite the moderate impact on orders and customer interactions associated with the COVID-19 pandemic, we remain fully operational and achieved growth in the quarter as well as a record number of design wins. We also continued to increase customer sampling of our STT-MRAM products as we pave the way for expanding design-ins. This is a testament to the persistence of the Everspin team and the strength of our leading technology and products.
“Looking to the second quarter, we expect to achieve another quarter of sequential revenue growth, while we cautiously monitor the global environment and remain prepared to promptly address any possible changes in market dynamics.”
First Quarter 2020 Results
Total revenue for the first quarter of 2020 was $10.1 million, compared to $9.7 million last quarter and $10.0 million in the first quarter of 2019.
Gross margin for the first quarter of 2020 was 52.9%, compared to 53.6% in the prior quarter and 47.7% in the first quarter of 2019.
GAAP operating expenses for the first quarter of 2020 were $6.9 million, compared to $8.2 million in the fourth quarter of 2019 and $9.0 million in the first quarter of 2019. On a non-GAAP basis, operating expenses for the first quarter of 2020 were $6.2 million, compared to $6.3 million in the prior quarter and $8.3 million in the year-ago quarter.
GAAP net loss for the first quarter of 2020 was $1.7 million, or ($0.10) per share, based on 18.1 million weighted-average shares outstanding. This compares to a net loss of $3.1 million, or ($0.17) per share, in the fourth quarter of 2019, which included $0.8 million in restructuring charges, and a net loss of $4.3 million, or ($0.25) per share, in the first quarter of 2019. On a non-GAAP basis, net loss for the first quarter of 2020 was $1.0 million, or ($0.05) per share, compared to a net loss of $1.2 million, or ($0.07) per share, in the prior quarter and a net loss of $3.6 million, or ($0.21) per share, in the first quarter of 2019.
Cash and cash equivalents as of March 31, 2020 were $14.0 million, compared to $14.5 million at the end of the fourth quarter of 2019. Prior to suspending trading on its at-the-market (ATM) equity facility during the quarter, the Company issued 0.5 million new shares resulting in net proceeds $2.1 million.
Business Outlook
For the second quarter of 2020, Everspin expects total revenue to increase to a range of $11.5 million and $12.5 million, compared to $8.6 million in the year-ago quarter. GAAP net loss is expected to range between ($0.12) and ($0.05) per share. Excluding stock-based compensation expense, non-GAAP net loss is expected to range between ($0.06) and ($0.00) per share based on a weighted-average share count of 18.6 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 4869017. 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 May 14, 2020. The replay can be accessed by dialing 1-855-859-2056 and using the passcode 4869017. 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 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-K filed with the Securities and Exchange Commission on March 13, 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. <br> Condensed Balance Sheets <br> (In thousands, except share and per share amounts) <br> (Unaudited) | |||||
|---|---|---|---|---|---|
| December 31, | |||||
| 2019 | |||||
| Assets | |||||
| Current assets: | |||||
| Cash and cash equivalents | 13,950 | $ | 14,487 | ||
| Accounts receivable, net | 6,320 | 5,799 | |||
| Inventory | 7,944 | 7,863 | |||
| Prepaid expenses and other current assets | 518 | 539 | |||
| Total current assets | 28,732 | 28,688 | |||
| Property and equipment, net | 3,077 | 3,479 | |||
| Right-of-use assets | 2,770 | 3,132 | |||
| Other assets | 73 | 73 | |||
| Total assets | 34,652 | $ | 35,372 | ||
| Liabilities and Stockholders’ Equity | |||||
| Current liabilities: | |||||
| Accounts payable | 1,761 | $ | 2,873 | ||
| Accrued liabilities | 1,965 | 2,727 | |||
| Current portion of long-term debt | 1,271 | 670 | |||
| Operating lease liabilities | 1,613 | 1,582 | |||
| Other liabilities | 34 | 42 | |||
| Total current liabilities | 6,644 | 7,894 | |||
| Long-term debt, net of current portion | 6,621 | 7,149 | |||
| Operating lease liabilities, net of current portion | 1,426 | 1,840 | |||
| Total liabilities | 14,691 | 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 March 31, 2020 and December 31, 2019 | — | — | |||
| Common stock, 0.0001 par value per share; 100,000,000 shares authorized; 18,638,555 and 18,081,753 shares issued and outstanding as of March 31, 2020 and December 31, 2019 | 2 | 2 | |||
| Additional paid-in capital | 170,353 | 167,149 | |||
| Accumulated deficit | (150,394 | ) | (148,662 | ) | |
| Total stockholders’ equity | 19,961 | 18,489 | |||
| Total liabilities and stockholders’ equity | 34,652 | $ | 35,372 |
All values are in US Dollars.
| EVERSPIN TECHNOLOGIES, INC.<br><br> <br>Condensed Statements of Operations and Comprehensive Loss<br><br> <br>(In thousands, except share and per share amounts)<br><br> <br>(Unaudited) | ||||||
|---|---|---|---|---|---|---|
| Three Months Ended March 31, | ||||||
| 2020 | 2019 | |||||
| Product sales | $ | 9,635 | $ | 9,023 | ||
| Licensing, royalty, and other revenue | 473 | 1,003 | ||||
| Total revenue | 10,108 | 10,026 | ||||
| Cost of sales | 4,757 | 5,241 | ||||
| Gross profit | 5,351 | 4,785 | ||||
| Operating expenses:^1^ | ||||||
| Research and development | 3,030 | 3,998 | ||||
| General and administrative | 2,800 | 3,595 | ||||
| Sales and marketing | 1,103 | 1,364 | ||||
| Total operating expenses | 6,933 | 8,957 | ||||
| Loss from operations | (1,582 | ) | (4,172 | ) | ||
| Interest expense | (172 | ) | (211 | ) | ||
| Other income, net | 22 | 127 | ||||
| Net loss and comprehensive loss | $ | (1,732 | ) | $ | (4,256 | ) |
| Net loss per common share, basic and diluted | $ | (0.10 | ) | $ | (0.25 | ) |
| Weighted-average shares used to compute net loss per common share, basic and diluted | 18,055,693 | 17,097,999 | ||||
| ^1^Operating expenses include stock-based compensation as follows: | ||||||
| Research and development | $ | 162 | $ | 147 | ||
| General and administrative | 585 | 509 | ||||
| Sales and marketing | 58 | 48 | ||||
| Total stock-based compensation | $ | 805 | $ | 704 |
| EVERSPIN TECHNOLOGIES, INC.<br><br> <br>Reconciliation of GAAP and Non-GAAP Financial Information<br><br> <br>(In thousands, except share and per share amounts)<br><br> <br>(Unaudited) | |||
|---|---|---|---|
| Three Months Ended | |||
| Mar 31, 2020 | Dec 31, 2019 | Mar 31, 2019 | |
| Reconciliation of GAAP and non-GAAP operating expenses | |||
| GAAP operating expenses | 6,933 | 8,199 | 8,957 |
| Reconciling item included in research and development | |||
| Stock-based compensation | 137 | 193 | 118 |
| Reconciling item included in selling, general and administrative | |||
| Stock-based compensation | 643 | 914 | 557 |
| Restructuring | 782 | ||
| Total reconciling items included in operating expenses | 780 | 1,889 | 675 |
| Non-GAAP operating expenses | 6,153 | 6,311 | 8,282 |
| GAAP NET INCOME (LOSS) | (1,732 | (3,079 | (4,256 |
| Reconciling items included in operating expenses | 780 | 1,889 | 675 |
| Non-GAAP net income (loss) | (951 | (1,191 | (3,581 |
| Non-GAAP net income (loss) per share, basic and diluted | (0.05 | (0.07 | (0.21 |
| Weighted average shares to compute net loss per common share, basic and diluted | 18,056 | 17,714 | 17,098 |
All values are in US Dollars.
| EVERSPIN TECHNOLOGIES, INC.<br><br> <br>Condensed Statement of Cash Flows<br><br> <br>(In thousands)<br><br> <br>(Unaudited) | ||||||
|---|---|---|---|---|---|---|
| Three Months Ended March 31, | ||||||
| 2020 | 2019 | |||||
| Cash flows from operating activities | ||||||
| Net loss | $ | (1,732 | ) | $ | (4,256 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
| Depreciation and amortization | 409 | 393 | ||||
| Loss on disposal of property and equipment | — | 20 | ||||
| Stock-based compensation | 805 | 704 | ||||
| Non-cash gain on warrant revaluation | (6 | ) | — | |||
| Non-cash interest expense | 73 | 81 | ||||
| Changes in operating assets and liabilities: | ||||||
| Accounts receivable | (521 | ) | 1,540 | |||
| Inventory | (81 | ) | (562 | ) | ||
| Prepaid expenses and other current assets | 21 | 93 | ||||
| Accounts payable | (1,067 | ) | (955 | ) | ||
| Accrued liabilities | (435 | ) | (187 | ) | ||
| Lease liabilities | (21 | ) | (20 | ) | ||
| Net cash used in operating activities | (2,555 | ) | (3,149 | ) | ||
| Cash flows from investing activities | ||||||
| Purchases of property and equipment | (64 | ) | (225 | ) | ||
| Net cash used in investing activities | (64 | ) | (225 | ) | ||
| Cash flows from financing activities | ||||||
| Payments on debt | — | (1,500 | ) | |||
| Payments on finance lease obligation | (2 | ) | (3 | ) | ||
| Proceeds from exercise of stock options and purchase of shares in employee stock purchase plan | — | 13 | ||||
| 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 | 2,082 | (1,490 | ) | |||
| Net decrease in cash and cash equivalents | (537 | ) | (4,864 | ) | ||
| Cash and cash equivalents at beginning of period | 14,487 | 23,379 | ||||
| Cash and cash equivalents at end of period | $ | 13,950 | $ | 18,515 | ||
| Supplementary cash flow information: | ||||||
| Interest paid | $ | 99 | $ | 135 | ||
| Operating cash flows paid for operating leases | $ | 486 | $ | 416 | ||
| Financing cash flows paid for finance leases | $ | 2 | $ | 3 | ||
| Non-cash investing and financing activities: | ||||||
| Purchase of property and equipment in accounts payable and accrued liabilities | $ | — | $ | 20 | ||
| Bonus settled in shares of common stock | $ | 315 | $ | — |
Contacts
Everspin Investor Relations Contact:
Leanne K. Sievers, President
Shelton Group Investor Relations
T: 949-224-3874
E: sheltonir@sheltongroup.com