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Everspin Reports Second Quarter 2021 Financial Results

The Company Reports its First Quarter in Company History with Net Income

Everspin Technologies, Inc. (NASDAQ: MRAM), the market leader in MRAM, today announced financial results for the second fiscal quarter of 2021.

Second Quarter 2021 Highlights

  • Q2’21 revenue increased 15% from the prior quarter to $11.85 million; this was an increase of $1.57 million compared to Q1’21 revenue. Q2’21 revenue was relatively flat to Q2’20 Revenue of $11.83 million.
  • The Company reported net income of $256k for Q2’21, compared to a net loss of $460k for Q1’21 and a net loss of $1.3 million for Q2’20.
  • Ended Q2’21 with cash and equivalents of $14.2 million.

“For the 1st time in Company history, we were GAAP net income positive for a quarter. This is a testament to the hard work and extra effort by the Everspin team to increase revenue and gross margins, while holding the line on spending,” stated Darin Billerbeck, Everspin’s Executive Chairman and Interim CEO.

Second Quarter 2021 Results

Total revenue for the second quarter of 2021 was $11.85 million, an increase of 15% from the $10.28 million reported last quarter. Q2’21 revenue was relatively flat to Q2’20 revenue of $11.83 million.

Gross margin for the second quarter of 2021 was 60.7%, compared to 58.2% in the prior quarter and 43.9% in the second quarter of 2020.

GAAP operating expenses for the second quarter of 2021 increased to $6.7 million, compared to $6.3 million in the first quarter of 2021 primarily due to a $900k increase in research & development spend, partially offset by a $500k decline in general and administrative expenses. This is compared to operating expenses of $6.3 million in the second quarter of 2020. GAAP operating expenses in the second quarter of 2021 included $704k of stock-based compensation, compared to $743k last quarter and $918k in the second quarter of 2020.

GAAP net income for the second quarter of 2021 was $256k, or $0.01 per share, based on 19.3 million basic weighted-average common shares outstanding. This compares to a net loss of $460k, or ($0.02) per share, in the first quarter of 2021 and a net loss of $1.3 million, or ($0.07) per share, in the second quarter of 2020.

Adjusted EBITDA for the second quarter of 2021 improved to $1.5 million, compared to a $0.8 million last quarter and $0.3 million in the second quarter of 2020.

Cash and cash equivalents as of June 30, 2021, were $14.2 million, compared to $15.5 million at the end of the first quarter of 2021.

Business Outlook

For the third quarter of 2021, Everspin expects total revenue in a range between $11.7 million and $12.7 million, which at the mid-point represents a 21% increase over total revenue of $10.12 million in the year-ago quarter. GAAP net loss per share is expected to range between ($0.04) and ($0.07) per share, which reflects expected stock-based compensation expense of approximately $0.8 million.

This outlook is dependent on Everspin’s current expectations, which may be impacted by, among other things, evolving external conditions, such as the resurgence of COVID-19 and its variants, local safety guidelines, supply chain constraints or interruptions, and the other risk factors described in Everspin’s filings with the SEC, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2020, its Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (the “SEC”) during 2021, as well as in its subsequent filings with the SEC.

Use of Non-GAAP Financial Measures

We supplement the reporting of our financial information determined under generally accepted accounting principles in the United States of America (GAAP) with Adjusted EBITDA, which is a non-GAAP financial measure. We define Adjusted EBITDA as net income (loss) adjusted for interest expense, taxes, depreciation and amortization, stock-based compensation expense, and restructuring costs if any.

Our management and board of directors use Adjusted EBITDA to understand and evaluate our operating performance and trends, to prepare and approve our annual budget and to develop short-term and long-term operating and financing plans. Accordingly, our management believes that this non-GAAP measure provide useful information for investors in understanding and evaluating our operating results in the same manner as our management and our board of directors, as well as facilitating comparisons of our operating performance on a period-to-period basis.

Non-GAAP financial measures, including Adjusted EBITDA, should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Moreover, other companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. We encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

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 9886239. 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 August 19, 2021. The replay can be accessed by dialing 1-855-859-2056 and using the passcode 9886239. 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 results 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.” Forward-looking statements are identified by words such as “believe”, “will”, “may”, “estimate”, “continue”, “anticipate”, “intend”, “should”, “plan”, “expect”, “predict”, “could”, “potentially" or the negative of these terms or similar expressions. These include, but are not limited to our future plans, strategies, objectives, expectations, intentions and financial performance and the assumptions that underlie these statements. Actual results could differ materially from these forward-looking statements as a result of certain risks and uncertainties, including, without limitation, the risks set forth under the caption “Risk Factors” in Everspin’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 4, 2021, and Everspin’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 to be filed with the SEC, as well as in our subsequent filings with the SEC. Any forward-looking statements made by Everspin in this press release speak only as of the date on which they are made and subsequent events may cause these expectations to change. 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)

 

June 30, 2021

December 31, 2020

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

14,219

 

 

$

14,599

 

Accounts receivable, net

 

 

10,383

 

 

 

7,607

 

Inventory

 

 

6,571

 

 

 

5,721

 

Prepaid expenses and other current assets

 

 

221

 

 

 

270

 

Total current assets

 

 

31,394

 

 

 

28,197

 

Property and equipment, net

 

 

1,288

 

 

 

1,946

 

Right-of-use assets

 

 

1,622

 

 

 

2,313

 

Other assets

 

 

313

 

 

 

73

 

Total assets

 

$

34,617

 

 

$

32,529

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

2,869

 

 

$

2,224

 

Accrued liabilities

 

 

1,742

 

 

 

2,232

 

Deferred revenue

 

 

1,815

 

 

 

 

Current portion of long-term debt

 

 

4,313

 

 

 

4,242

 

Operating lease liabilities

 

 

1,190

 

 

 

1,508

 

Other liabilities

 

 

36

 

 

 

31

 

Total current liabilities

 

 

11,965

 

 

 

10,237

 

Long-term debt, net of current portion

 

 

2,645

 

 

 

3,748

 

Operating lease liabilities, net of current portion

 

 

466

 

 

 

903

 

Long-term income tax liability

 

 

229

 

 

 

229

 

Total liabilities

 

$

15,305

 

 

$

15,117

 

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 June 30, 2021 and December 31, 2020

 

 

 

 

 

 

Common stock, $0.0001 par value per share; 100,000,000 shares authorized; 19,435,274 and 19,031,556 shares issued and outstanding as of June 30, 2021 and December 31, 2020

 

 

2

 

 

 

2

 

Additional paid-in capital

 

 

176,688

 

 

 

174,584

 

Accumulated deficit

 

 

(157,378

)

 

 

(157,174

)

Total stockholders’ equity

 

 

19,312

 

 

 

17,412

 

Total liabilities and stockholders’ equity

 

$

34,617

 

 

$

32,529

 

 

EVERSPIN TECHNOLOGIES, INC.

Condensed Statements of Operations and Comprehensive Income (Loss)

(In thousands, except share and per share amounts)

(Unaudited)

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Product sales

 

$

10,187

 

 

$

10,927

 

 

$

19,255

 

 

$

20,562

 

Licensing, royalty, and other revenue

 

 

1,661

 

 

 

899

 

 

 

2,873

 

 

 

1,372

 

Total revenue

 

 

11,848

 

 

 

11,826

 

 

 

22,128

 

 

 

21,934

 

Cost of product sales

 

 

4,329

 

 

 

6,521

 

 

 

8,586

 

 

 

11,246

 

Cost of licensing, royalty, and other revenue

 

 

323

 

 

 

114

 

 

 

361

 

 

 

146

 

Total cost of sales

 

 

4,652

 

 

 

6,635

 

 

 

8,947

 

 

 

11,392

 

Gross profit

 

 

7,196

 

 

 

5,191

 

 

 

13,181

 

 

 

10,542

 

Operating expenses:1

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

3,357

 

 

 

2,774

 

 

 

5,796

 

 

 

5,804

 

General and administrative

 

 

2,338

 

 

 

2,448

 

 

 

5,181

 

 

 

5,248

 

Sales and marketing

 

 

1,045

 

 

 

1,056

 

 

 

2,032

 

 

 

2,159

 

Total operating expenses

 

 

6,740

 

 

 

6,278

 

 

 

13,009

 

 

 

13,211

 

Gain (loss) from operations

 

 

456

 

 

 

(1,087

)

 

 

172

 

 

 

(2,669

)

Interest expense

 

 

(144

)

 

 

(172

)

 

 

(296

)

 

 

(344

)

Other (expense) income, net

 

 

(12

)

 

 

15

 

 

 

(27

)

 

 

63

 

Net income (loss) before income taxes

 

 

300

 

 

 

(1,244

)

 

 

(151

)

 

 

(2,950

)

Income tax expense

 

 

(44

)

 

 

(50

)

 

 

(53

)

 

 

(76

)

Net income (loss) and comprehensive income (loss)

 

$

256

 

 

$

(1,294

)

 

$

(204

)

 

$

(3,026

)

Net income (loss) per share attributable to common stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.01

 

 

$

(0.07

)

 

$

(0.01

)

 

$

(0.16

)

Diluted

 

$

0.01

 

 

$

(0.07

)

 

$

(0.01

)

 

$

(0.16

)

Weighted average common shares used to compute net income (loss) per common share attributable to common stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

19,313,162

 

 

 

18,747,124

 

 

 

19,203,374

 

 

 

18,585,339

 

Diluted

 

 

19,726,064

 

 

 

18,747,124

 

 

 

19,203,374

 

 

 

18,585,339

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1Operating expenses include stock-based compensation as follows:

Research and development

 

$

265

 

 

$

194

 

 

$

446

 

 

$

356

 

General and administrative

 

 

305

 

 

 

646

 

 

 

790

 

 

 

1,231

 

Sales and marketing

 

 

134

 

 

 

78

 

 

 

211

 

 

 

136

 

Total stock-based compensation

 

$

704

 

 

$

918

 

 

$

1,447

 

 

$

1,723

 

 

EVERSPIN TECHNOLOGIES, INC.

Reconciliation of Adjusted EBITDA

(In thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

June 30, 2021

 

March 31, 2021

 

June 30, 2020

Adjusted EBITDA reconciliation:

 

 

 

 

 

 

 

 

 

Net income (loss)

$

256

$

(460

)

$

(1,294

)

Depreciation and amortization

 

 

373

 

 

383

 

 

 

404

 

Stock-based compensation expense

704

743

 

918

 

Interest expense

 

 

144

 

 

152

 

 

 

172

 

Income tax expense

 

44

 

9

 

 

51

 

Adjusted EBITDA

 

$

1,521

 

$

827

 

 

$

251

 

 

EVERSPIN TECHNOLOGIES, INC.

Condensed Statement of Cash Flows

(In thousands)

(Unaudited)

 

 

 

Six Months Ended June 30,

 

 

2021

 

2020

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

$

(204

)

 

$

(3,026

)

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

 

 

 

 

 

 

Depreciation and amortization

 

 

756

 

 

 

813

 

Stock-based compensation

 

 

1,447

 

 

 

1,723

 

Non-cash warrant revaluation

 

 

5

 

 

 

7

 

Non-cash interest expense

 

 

168

 

 

 

147

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

(2,776

)

 

 

(1,540

)

Inventory

 

 

(850

)

 

 

(505

)

Prepaid expenses and other current assets

 

 

49

 

 

 

38

 

Accounts payable

 

 

861

 

 

 

(776

)

Accrued liabilities

 

 

(126

)

 

 

(1,008

)

Deferred revenue

 

 

1,815

 

 

 

 

Lease liabilities

 

 

(64

)

 

 

(73

)

Net cash provided by (used in) operating activities

 

 

1,081

 

 

 

(4,200

)

Cash flows from investing activities

 

 

 

 

 

 

Purchases of property and equipment

 

 

(554

)

 

 

(277

)

Net cash used in investing activities

 

 

(554

)

 

 

(277

)

Cash flows from financing activities

 

 

 

 

 

 

Payments on long-term debt

 

 

(1,200

)

 

 

 

Payments on finance lease obligation

 

 

 

 

 

(5

)

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

 

 

293

 

 

 

827

 

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

 

 

 

 

 

2,084

 

Net cash (used in) provided by financing activities

 

 

(907

)

 

 

2,906

 

Net decrease in cash and cash equivalents

 

 

(380

)

 

 

(1,571

)

Cash and cash equivalents at beginning of period

 

 

14,599

 

 

 

14,487

 

Cash and cash equivalents at end of period

 

$

14,219

 

 

$

12,916

 

Supplementary cash flow information:

 

 

 

 

 

 

Interest paid

 

$

128

 

 

$

197

 

Operating cash flows paid for operating leases

 

$

814

 

 

$

862

 

Financing cash flows paid for finance leases

 

$

 

 

$

5

 

Non-cash investing and financing activities:

 

 

 

 

 

 

Increase of right-of-use asset and lease liability due to lease modification

 

$

 

 

$

545

 

Purchases of property and equipment in accounts payable and accrued liabilities

 

$

 

 

$

22

 

Bonus settled in shares of common stock

 

$

364

 

 

$

315

 

 

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