News Details

View all news

nLIGHT, Inc. Announces Third Quarter 2022 Results

11/03/2022

Revenues of $60.1 million and gross margin of 22.4% for the third quarter of 2022

CAMAS, Wash.--(BUSINESS WIRE)-- nLIGHT, Inc. (Nasdaq: LASR), a leading provider of high-power semiconductor and fiber lasers used in the industrial, microfabrication, and aerospace and defense markets, today reported financial results for the third quarter of 2022.

“Our third quarter results reflect the continued transformation of our business. Ninety one percent of our revenue was from customers outside of China and we delivered a strong quarter in Microfabrication and Industrial,” commented Scott Keeney, nLIGHT’s President and Chief Executive Officer. “Operationally, we continued to ramp our automated manufacturing capabilities in the United States and we introduced several new products that enhance our long-term growth opportunities in each of our end-markets. We also made important progress in several of our key development programs and continued to increase our engagement with Directed Energy customers.”

Mr. Keeney continued, “While we are projecting near-term growth from many of our strategic customers, we are navigating a weaker demand environment, which we believe will persist for the next several quarters. We believe that softening demand is a response to changes in the near-term global business environment and not a fundamental shift in the markets or customers we serve. Our long-term growth opportunities remain intact and aligned with our strategy to focus on both the Industrial and Aerospace and Defense markets.”

Third Quarter 2022 Financial Highlights

 

Three Months Ended
September 30,

 

 

(In thousands, except percentages)

2022

 

2021

 

% Change

Revenues

$

60,093

 

 

$

72,235

 

 

(16.8

)%

Gross margin

 

22.4

%

 

 

29.6

%

 

 

Loss from operations

$

(12,981

)

 

$

(6,759

)

 

(92.1

)%

Operating margin

 

(21.6

)%

 

 

(9.4

)%

 

 

Net loss

$

(12,955

)

 

$

(6,880

)

 

(88.3

)%

Adjusted EBITDA(1)

$

(1,402

)

 

$

7,212

 

 

(119.4

)%

Adjusted EBITDA, as percentage of revenues

 

(2.3

)%

 

 

10.0

%

 

 

(1) A reconciliation of the non-GAAP metrics presented here to the most directly comparable GAAP metric has been provided in the tables included at the end of this release.

Revenues of $60.1 million for the third quarter of 2022 were down 16.8% compared to $72.2 million for the third quarter of 2021. Gross margin was 22.4% for the third quarter of 2022 compared to 29.6% for the third quarter of 2021. GAAP net loss for the third quarter of 2022 was $13.0 million, or net loss of $0.29 per diluted share, compared to net loss of $6.9 million, or net loss of $0.16 per diluted share, for the third quarter of 2021. Non-GAAP net loss for the third quarter of 2022 was $5.1 million, or non-GAAP net loss of $0.11 per diluted share, compared to non-GAAP net income of $3.9 million, or non-GAAP net income of $0.08 per diluted share, for the third quarter of 2021. Reconciliations of the non-GAAP metrics presented here to the most directly comparable GAAP metric have been provided in the tables included at the end of this release.

Outlook

For the fourth quarter of 2022, nLIGHT expects revenues to be in the range of $53 million to $59 million, gross margin to be in the range of 20% to 23%, and Adjusted EBITDA to be in the range of $(4) million to $(1) million.

We have not reconciled our outlook for Adjusted EBITDA because unrealized and realized foreign exchange gains and losses cannot be reasonably calculated or predicted nor can the probable significance be determined at this time. Accordingly, a reconciliation is not available without unreasonable effort.

Investor Conference Call at 2:00 p.m. Pacific Time, Thursday, November 3, 2022

Parties interested in listening to nLIGHT’s quarterly conference call may do so by dialing 1-833-535-2198 (U.S., toll-free) or +1-412-902-6775 (international and toll), with the conference title: nLIGHT Third Quarter 2022 Earnings. The call can also be accessed via the web by going to nLIGHT’s Investor Relations page at http://investors.nlight.net.

Use of Non-GAAP Financial Results

In addition to U.S. GAAP results, this press release contains non-GAAP financial results, including Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) per share, basic and diluted. We use Adjusted EBITDA to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. In addition to our results determined in accordance with GAAP, we believe Adjusted EBITDA is a meaningful measure of performance as it is commonly utilized by us and the investment community to analyze operating performance in our industry. Similarly, we believe that providing non-GAAP net income and non-GAAP net income per share, basic and diluted, is useful to our investors as they present an informative supplemental view of our results from period to period by removing the effect of stock-based compensation expense and other non-recurring items. However, the non-GAAP financial metrics presented herein are specific to us and may not be comparable to similar metrics disclosed by other companies because of differing methods used by other companies in calculating them.

We define Adjusted EBITDA as net income (loss) adjusted for income tax expense (benefit), other non-operating income or expense, interest income or expense, depreciation and amortization, stock-based compensation, acquisition and integration-related costs, and other non-recurring items as determined by management, as applicable. We define non-GAAP net income (loss) as GAAP net income (loss) adjusted for stock-based compensation, amortization of purchased intangibles, acquisition and integration-related costs, and other non-recurring items as determined by management, as applicable. We define non-GAAP net income (loss) per share, basic and diluted, as non-GAAP net income (loss) divided by the weighted average number of shares outstanding during the respective period plus the dilutive effect of any common stock equivalents during the period in the case of non-GAAP net income (loss) per share, diluted.

Tables presenting the reconciliation of net loss to Adjusted EBITDA, as well as the reconciliation of GAAP loss to non-GAAP net income (loss) and GAAP to non-GAAP net income (loss) per share, basic and diluted, are included at the end of this press release.

Safe Harbor Statement

Certain statements in this release are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Words such as “outlook,” “guidance,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “anticipates,” and similar expressions may identify these forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements regarding expected revenues, gross margin, and Adjusted EBITDA, near-term and long-term growth opportunities, and near-term weakness in demand environment, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on our current expectations and assumptions, which may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially from these forward-looking statements, including but not limited to our ability to compete successfully in the markets for our products; changes in the markets we serve or in the global economy; our ability to increase our volumes and decrease our costs to offset potential declines in the average selling prices of our products; rapid technological changes in the markets that we participate in; our ability to develop and maintain products that can achieve market acceptance; our ability to generate sufficient revenues to achieve or maintain profitability in the future; our high levels of fixed costs and inventory and their effect on our gross profits and results of operations if demand for our products declines or we maintain excess inventory levels; disruptions, such as the COVID-19 pandemic, and their effect on our business, financial condition, or results of operations; our manufacturing capacity and operations and their suitability for future levels of demand; our reliance on a small number of customers for a significant portion of our revenues; our ability to manage risks associated with international customers and operations; the effect of government export and import controls on our ability to compete in international markets; our ability to protect our proprietary technology and intellectual property rights; fluctuations in our quarterly results of operations and other operating measures; and the effect on our business of claims, lawsuits, government investigations, other legal or regulatory proceedings, or commercial or contractual disputes that we may become involved in. Additional information concerning these and other factors can be found in nLIGHT's filings with the Securities and Exchange Commission (the “SEC”), including other risks, relevant factors and uncertainties identified in the “Risk Factors” section of nLIGHT's most recent Annual Report on Form 10-K or subsequent filings with the SEC. nLIGHT undertakes no obligation to update publicly or revise any forward-looking statements contained herein to reflect future events or developments, except as required by law.

The nLIGHT logo and “nLIGHT” are registered trademarks or trademarks of nLIGHT, Inc. in various jurisdictions.

About nLIGHT

nLIGHT, Inc. is a leading provider of high-power semiconductor and fiber lasers for industrial, microfabrication, aerospace and defense applications. Our lasers are changing not only the way things are made but also the things that can be made. Headquartered in Camas, Washington, nLIGHT employs over 1,200 people with operations in the U.S., China, Finland, Korea and Italy. For more information, please visit www.nlight.net.

nLIGHT, Inc.

Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2022

 

2021

 

2022

 

2021

Revenue:

 

 

 

 

 

 

 

Products

$

48,042

 

 

$

54,393

 

 

$

147,283

 

 

$

155,289

 

Development

 

12,051

 

 

 

17,842

 

 

 

38,096

 

 

 

47,404

 

Total revenue

 

60,093

 

 

 

72,235

 

 

 

185,379

 

 

 

202,693

 

Cost of revenue:

 

 

 

 

 

 

 

Products

 

35,350

 

 

 

34,193

 

 

 

104,801

 

 

 

98,828

 

Development

 

11,267

 

 

 

16,647

 

 

 

35,540

 

 

 

44,500

 

Total cost of revenue(1)

 

46,617

 

 

 

50,840

 

 

 

140,341

 

 

 

143,328

 

Gross profit

 

13,476

 

 

 

21,395

 

 

 

45,038

 

 

 

59,365

 

Operating expenses:

 

 

 

 

 

 

 

Research and development(1)

 

12,716

 

 

 

14,838

 

 

 

40,215

 

 

 

40,830

 

Sales, general, and administrative(1)

 

13,741

 

 

 

13,316

 

 

 

36,430

 

 

 

40,087

 

Total operating expenses

 

26,457

 

 

 

28,154

 

 

 

76,645

 

 

 

80,917

 

Loss from operations

 

(12,981

)

 

 

(6,759

)

 

 

(31,607

)

 

 

(21,552

)

Other income (expense):

 

 

 

 

 

 

 

Interest income (expense), net

 

167

 

 

 

(20

)

 

 

238

 

 

 

(126

)

Other income (loss), net

 

(31

)

 

 

102

 

 

 

(108

)

 

 

246

 

Loss before income taxes

 

(12,845

)

 

 

(6,677

)

 

 

(31,477

)

 

 

(21,432

)

Income tax expense (benefit)

 

110

 

 

 

203

 

 

 

443

 

 

 

(513

)

Net loss

$

(12,955

)

 

$

(6,880

)

 

$

(31,920

)

 

$

(20,919

)

Net loss per share, basic and diluted

$

(0.29

)

 

$

(0.16

)

 

$

(0.72

)

 

$

(0.50

)

Shares used in per share calculations:

 

 

 

 

 

 

 

Basic and diluted

 

44,786

 

 

 

42,884

 

 

 

44,289

 

 

 

41,759

 

(1)Includes stock-based compensation as follows:

 

 

 

 

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Cost of revenues

$

712

 

 

$

740

 

 

$

2,105

 

 

$

1,780

 

Research and development

 

3,169

 

 

 

3,782

 

 

 

9,408

 

 

 

10,408

 

Sales, general, and administrative

 

3,614

 

 

 

5,550

 

 

 

9,215

 

 

 

17,544

 

 

$

7,495

 

 

$

10,072

 

 

$

20,728

 

 

$

29,732

 

nLIGHT, Inc.

Condensed Consolidated Balance Sheets

(In thousands)

(Unaudited)

 

 

As of

 

September 30, 2022

 

December 31, 2021

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

62,184

 

 

$

146,534

 

Marketable Securities

 

50,190

 

 

 

 

Accounts receivable, net of allowances of $287 and $303

 

43,803

 

 

 

41,574

 

Inventory

 

80,660

 

 

 

73,746

 

Prepaid expenses and other current assets

 

14,138

 

 

 

15,350

 

Total current assets

 

250,975

 

 

 

277,204

 

Restricted cash

 

251

 

 

 

250

 

Lease right-of-use assets

 

14,472

 

 

 

17,048

 

Property and equipment, net

 

63,232

 

 

 

56,101

 

Intangible assets, net

 

4,676

 

 

 

6,698

 

Goodwill

 

12,313

 

 

 

12,420

 

Other assets, net

 

2,634

 

 

 

3,897

 

Total assets

$

348,553

 

 

$

373,618

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

19,755

 

 

$

26,347

 

Accrued liabilities

 

14,548

 

 

 

14,730

 

Deferred revenue

 

1,736

 

 

 

1,629

 

Lease liabilities

 

2,697

 

 

 

3,066

 

Total current liabilities

 

38,736

 

 

 

45,772

 

Non-current income taxes payable

 

6,527

 

 

 

7,149

 

Long-term lease liabilities

 

13,515

 

 

 

14,612

 

Other long-term liabilities

 

3,937

 

 

 

3,952

 

Total liabilities

 

62,715

 

 

 

71,485

 

Stockholders' equity:

 

 

 

Common stock - $0.0001 par value; 190,000 shares authorized, 45,303 and 44,248 shares issued and outstanding at September 30, 2022, and December 31, 2021, respectively

 

16

 

 

 

15

 

Additional paid-in capital

 

489,867

 

 

 

470,760

 

Accumulated other comprehensive loss

 

(4,070

)

 

 

(587

)

Accumulated deficit

 

(199,975

)

 

 

(168,055

)

Total stockholders’ equity

 

285,838

 

 

 

302,133

 

Total liabilities and stockholders’ equity

$

348,553

 

 

$

373,618

 

nLIGHT, Inc.

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

 

Nine Months Ended
September 30,

 

2022

 

2021

Cash flows from operating activities:

 

 

 

Net loss

$

(31,920

)

 

$

(20,919

)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

 

 

 

Depreciation

 

8,135

 

 

 

6,670

 

Amortization

 

3,492

 

 

 

4,641

 

Reduction in carrying amount of right-of-use assets

 

2,369

 

 

 

2,435

 

Provision for (recoveries of) losses on accounts receivable

 

2

 

 

 

(70

)

Stock-based compensation

 

20,728

 

 

 

29,732

 

Deferred income taxes

 

(1

)

 

 

(11

)

Loss on disposal of assets

 

 

 

 

3

 

Unrealized gain on available-for-sale securities

 

(190

)

 

 

 

Changes in operating assets and liabilities:

 

 

 

Accounts receivable, net

 

(3,431

)

 

 

(4,580

)

Inventory

 

(8,761

)

 

 

(16,169

)

Prepaid expenses and other current assets

 

1,091

 

 

 

(5,542

)

Other assets

 

(308

)

 

 

(437

)

Accounts payable

 

(5,792

)

 

 

9,699

 

Accrued and other long-term liabilities

 

1,219

 

 

 

907

 

Deferred revenues

 

142

 

 

 

(925

)

Lease liabilities

 

(1,241

)

 

 

(2,156

)

Non-current income taxes payable

 

(86

)

 

 

(591

)

Net cash provided by (used in) operating activities

 

(14,552

)

 

 

2,687

 

Cash flows from investing activities:

 

 

 

Acquisition of business, net of cash acquired

 

(664

)

 

 

(291

)

Purchases of property, plant and equipment

 

(16,442

)

 

 

(13,636

)

Capitalization of patents

 

(359

)

 

 

(303

)

Purchase of marketable securities

 

(50,000

)

 

 

 

Net cash used in investing activities

 

(67,465

)

 

 

(14,230

)

Cash flows from financing activities:

 

 

 

Proceeds from public offerings, net of offering costs

 

 

 

 

82,354

 

Principal payments on debt and financing leases

 

 

 

 

(428

)

Payment of contingent consideration related to acquisition

 

 

 

 

(326

)

Proceeds from employee stock plan purchases

 

1,201

 

 

 

750

 

Proceeds from stock option exercises

 

1,146

 

 

 

975

 

Tax payments related to stock award issuances

 

(3,967

)

 

 

(8,265

)

Net cash provided by (used in) financing activities

 

(1,620

)

 

 

75,060

 

Effect of exchange rate changes on cash

 

(712

)

 

 

(256

)

Net increase (decrease) in cash, cash equivalents and restricted cash

 

(84,349

)

 

 

63,261

 

Cash, cash equivalents and restricted cash, beginning of period

 

146,784

 

 

 

102,573

 

Cash, cash equivalents and restricted cash, end of period

$

62,435

 

 

$

165,834

 

Supplemental disclosures:

 

 

 

Cash paid for interest, net

$

 

 

$

116

 

Cash paid for income taxes

 

250

 

 

 

434

 

Operating cash outflows from operating leases

 

2,828

 

 

 

2,555

 

Right-of-use assets obtained in exchange for lease liabilities

 

2,242

 

 

 

7,348

 

Accrued purchases of property, equipment and patents

 

2,468

 

 

 

2,287

 

nLIGHT, Inc.

Reconciliation of GAAP Financial Metrics to Non-GAAP

(In thousands, except per share data)

(Unaudited)

 

Reconciliation of Net Loss to Adjusted EBITDA

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2022

 

2021

 

2022

 

2021

Net loss

$

(12,955

)

 

$

(6,880

)

 

$

(31,920

)

 

$

(20,919

)

Income tax expense (benefit)

 

110

 

 

 

203

 

 

 

443

 

 

 

(513

)

Other (income) expense, net

 

31

 

 

 

(102

)

 

 

108

 

 

 

(246

)

Interest (income) expense, net

 

(167

)

 

 

20

 

 

 

(238

)

 

 

126

 

Depreciation and amortization

 

4,084

 

 

 

3,899

 

 

 

11,627

 

 

 

11,311

 

Stock-based compensation

 

7,495

 

 

 

10,072

 

 

 

20,728

 

 

 

29,732

 

Adjusted EBITDA

$

(1,402

)

 

$

7,212

 

 

$

748

 

 

$

19,491

 

Reconciliation of GAAP to Non-GAAP Net Income (Loss), and GAAP to Non-GAAP Net Income (Loss) per Share, Basic and Diluted

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Net loss

$

(12,955

)

 

$

(6,880

)

 

$

(31,920

)

 

$

(20,919

)

Add back:

 

 

 

 

 

 

 

Stock-based compensation(1)

 

7,495

 

 

 

10,072

 

 

 

20,728

 

 

 

29,732

 

Amortization of purchased intangibles(1)

 

360

 

 

 

718

 

 

 

1,239

 

 

 

2,153

 

Non-GAAP net income (loss)

$

(5,100

)

 

$

3,910

 

 

$

(9,953

)

 

$

10,966

 

 

 

 

 

 

 

 

 

GAAP weighted average shares outstanding

 

44,786

 

 

 

42,884

 

 

 

44,289

 

 

 

41,759

 

Participating securities

 

 

 

 

774

 

 

 

 

 

 

681

 

Non-GAAP weighted average number of shares, basic

 

44,786

 

 

 

43,658

 

 

 

44,289

 

 

 

42,440

 

Dilutive effect of common stock equivalents

 

 

 

 

3,986

 

 

 

 

 

 

4,510

 

Non-GAAP weighted average number of shares, diluted

 

44,786

 

 

 

47,644

 

 

 

44,289

 

 

 

46,950

 

 

 

 

 

 

 

 

 

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

$

(0.11

)

 

$

0.09

 

 

$

(0.22

)

 

$

0.26

 

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

$

(0.11

)

 

$

0.08

 

 

$

(0.22

)

 

$

0.23

 

(1) There is no income tax effect related to the stock-based compensation and amortization of purchased intangibles adjustments due to the full valuation allowance in the United States.

 

Joseph Corso
Chief Financial Officer
nLIGHT, Inc.
(360) 566-4460
joe.corso@nlight.net

Source: nLIGHT, Inc.

Multimedia Files:

View all news