Press release

Impinj Reports First Quarter 2021 Financial Results

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Sponsored by Businesswire

Impinj, Inc. (NASDAQ: PI), a leading RAIN RFID provider and Internet of Things pioneer, today released its financial results for the first quarter ended March 31, 2021.

“Our first-quarter results were strong, exceeding our revenue and profitability guidance,” said Chris Diorio, Impinj co-founder and CEO. “We delivered a record bookings quarter, strengthened our team and see strong demand and growth opportunities ahead.”

First Quarter 2021 Financial Summary

  • Revenue of $45.2 million
  • GAAP gross margin of 48.6%; non-GAAP gross margin of 50.3%
  • GAAP net loss of $9.4 million, or loss of $0.40 per diluted share using 23.7 million shares
  • Adjusted EBITDA of $0.9 million
  • Non-GAAP net income of $0.3 million, or income of $0.01 per diluted share using 25.7 million shares

A reconciliation between GAAP and non-GAAP information is contained in the tables below. Additionally, descriptions of these non-GAAP financial measures are provided in the “Non-GAAP Financial Measures” sections below.

Second Quarter 2021 Financial Outlook

Impinj provides guidance based on current market conditions and expectations; actual results may differ materially. Please refer to the comments below regarding forward-looking statements. The following table presents Impinj’s financial outlook for the second quarter 2021 (in millions, except per share data):

 

 

Three Months Ending

 

 

June 30, 2021

Revenue

 

$41.5 to $43.5

GAAP Net loss

 

($11.4) to ($10.4)

Adjusted EBITDA profit (loss)

 

($1.5) to $0.0

Non-GAAP net loss

 

($2.0) to ($0.5)

GAAP Weighted-average shares — basic and diluted

 

24.10 to 24.30

GAAP Net loss per share — basic and diluted

 

($0.47) to ($0.43)

Non-GAAP Weighted-average shares — basic and diluted

 

24.10 to 24.30

Non-GAAP Net loss per share — basic and diluted

 

($0.08) to ($0.02)

A reconciliation between GAAP and non-GAAP is provided in the “Non-GAAP Financial Measures” section below.

Conference Call Information

Impinj will host a conference call today, Apr. 28, 2021 at 5:00 p.m. ET / 2:00 p.m. PT for analysts and investors to ask questions on its first quarter 2021 results, as well as its outlook for its second quarter 2021. Open to the public, investors may access the call by dialing +1-412-317-5196. A live webcast of the conference call will also be accessible on our website at investor.impinj.com. Following the webcast, an archived version will be available on the website for one year. A telephonic replay of the call will be available one hour after the call and will run for five business days and may be accessed by dialing +1-412-317-0088 and entering passcode 10154139.

Management’s prepared written remarks, along with quarterly financial data, will be made available on our website at investor.impinj.com commensurate with this release.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding the market for RAIN RFID, our strategy, prospects, the impact of Covid-19, and financial considerations for second quarter 2021 and future periods.

Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance.

The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption “Risk Factors” and elsewhere in our annual report on Form 10-K and quarterly reports on Form 10-Q filed with the U.S. Securities and Exchange Commission. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update this information unless required by law.

About Impinj

Impinj (NASDAQ: PI) helps businesses and people analyze, optimize, and innovate by wirelessly connecting billions of everyday things — such as apparel, automobile parts, luggage, and shipments — to the Internet. The Impinj platform uses RAIN RFID to deliver timely data about these everyday things to business and consumer applications, enabling a boundless Internet of Things. www.impinj.com

Impinj is a registered trademark of Impinj, Inc. All other trademarks are the property of their owners.

 

IMPINJ, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except par value, unaudited)

 

 

March 31, 2021 (1)

 

December 31, 2020

Assets:

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

49,796

 

 

$

23,636

 

Short-term investments

 

69,551

 

 

 

82,453

 

Accounts receivable, net

 

23,505

 

 

 

25,003

 

Inventory

 

28,067

 

 

 

36,329

 

Prepaid expenses and other current assets

 

2,810

 

 

 

3,943

 

Total current assets

 

173,729

 

 

 

171,364

 

Property and equipment, net

 

20,797

 

 

 

16,531

 

Operating lease right-of-use assets

 

13,736

 

 

 

13,761

 

Other non-current assets

 

2,349

 

 

 

2,079

 

Goodwill

 

3,881

 

 

 

3,881

 

Total assets

$

214,492

 

 

$

207,616

 

Liabilities and stockholders’ equity:

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

8,799

 

 

$

10,144

 

Accrued compensation and employee related benefits

 

5,874

 

 

 

5,529

 

Accrued and other current liabilities

 

2,304

 

 

 

1,468

 

Current portion of operating lease liabilities

 

3,813

 

 

 

3,641

 

Current portion of restructuring liabilities

 

1,235

 

 

 

 

Current portion of long-term debt

 

83,951

 

 

 

 

Current portion of deferred revenue

 

6,209

 

 

 

6,811

 

Total current liabilities

 

112,185

 

 

 

27,593

 

Long-term debt, net of current portion

 

 

 

 

54,556

 

Operating lease liabilities, net of current portion

 

14,881

 

 

 

15,266

 

Other long-term liabilities

 

805

 

 

 

805

 

Deferred revenue, net of current portion

 

246

 

 

 

277

 

Total liabilities

 

128,117

 

 

 

98,497

 

 

 

 

 

Stockholders’ equity:

 

 

 

Common stock, $0.001 par value

 

24

 

 

 

23

 

Additional paid-in capital

 

406,988

 

 

 

423,759

 

Accumulated other comprehensive income

 

3

 

 

 

3

 

Accumulated deficit

 

(320,640

)

 

 

(314,666

)

Total stockholders’ equity

 

86,375

 

 

 

109,119

 

Total liabilities and stockholders’ equity

$

214,492

 

 

$

207,616

 

 

(1) We adopted ASU 2020-06 on January 1, 2021 using modified retrospective transition method and accounted for our convertible notes due 2026, or the 2019 Notes, on a whole-instrument basis. Upon adoption, we no longer had unamortized debt discount related to the equity component of the 2019 Notes as of March 31, 2021. The condensed consolidated financial statements as of March 31, 2021 are presented under ASU 2020-06, while comparative prior reporting period presented is not adjusted and continue to be reported in accordance with our historical accounting policy.

IMPINJ, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data, unaudited)

 

 

Three Months Ended

 

 

March 31,

 

 

 

2021

 

 

 

2020

 

Revenue

 

$

45,248

 

 

$

47,822

 

Cost of revenue

 

 

23,267

 

 

 

26,428

 

Gross profit

 

 

21,981

 

 

 

21,394

 

Operating expenses:

 

 

 

 

Research and development

 

 

13,791

 

 

 

11,057

 

Sales and marketing

 

 

7,645

 

 

 

7,490

 

General and administrative

 

 

8,154

 

 

 

6,242

 

Restructuring costs

 

 

1,263

 

 

 

 

Total operating expenses

 

 

30,853

 

 

 

24,789

 

Loss from operations

 

 

(8,872

)

 

 

(3,395

)

Other income, net

 

 

23

 

 

 

409

 

Interest expense

 

 

(525

)

 

 

(1,312

)

Loss before income taxes

 

 

(9,374

)

 

 

(4,298

)

Income tax expense

 

 

(42

)

 

 

(28

)

Net loss

 

$

(9,416

)

 

$

(4,326

)

Net loss per share — basic and diluted

 

$

(0.40

)

 

$

(0.19

)

Weighted-average shares — basic and diluted

 

 

23,671

 

 

 

22,412

 

 

IMPINJ, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands, unaudited)

 

 

 

Three Months Ended

 

 

March 31,

 

 

 

2021

 

 

 

2020

 

Operating activities:

 

 

 

 

Net loss

 

$

(9,416

)

 

$

(4,326

)

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

 

Depreciation

 

 

1,040

 

 

 

1,168

 

Stock-based compensation

 

 

7,449

 

 

 

5,221

 

Accretion of discount or amortization of premium on short-term investments

 

 

218

 

 

 

(4

)

Amortization of debt issuance costs and debt discount

 

 

94

 

 

 

879

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

 

1,498

 

 

 

(4,371

)

Inventory

 

 

8,262

 

 

 

2,390

 

Prepaid expenses and other assets

 

 

880

 

 

 

368

 

Deferred revenue

 

 

(633

)

 

 

155

 

Accounts payable

 

 

(2,137

)

 

 

1,096

 

Accrued compensation and employee related benefits

 

 

345

 

 

 

(1,933

)

Operating lease right-of-use assets

 

 

723

 

 

 

657

 

Operating lease liabilities

 

 

(911

)

 

 

(823

)

Accrued liabilities and other liabilities

 

 

722

 

 

 

1,368

 

Restructuring liabilities

 

 

1,235

 

 

 

 

Net cash provided by operating activities

 

 

9,369

 

 

 

1,845

 

Investing activities:

 

 

 

 

Purchases of investments

 

 

(12,333

)

 

 

 

Proceeds from maturities of investments

 

 

25,000

 

 

 

14,175

 

Purchases of property and equipment

 

 

(4,398

)

 

 

(1,112

)

Net cash provided by investing activities

 

 

8,269

 

 

 

13,063

 

Financing activities:

 

 

 

 

Principal payments on finance lease obligations

 

 

(2

)

 

 

(98

)

Proceeds from exercise of stock options and employee stock purchase plan

 

 

8,524

 

 

 

2,014

 

Net cash provided by financing activities

 

 

8,522

 

 

 

1,916

 

Net increase in cash and cash equivalents

 

 

26,160

 

 

 

16,824

 

Cash and cash equivalents

 

 

 

 

Beginning of period

 

 

23,636

 

 

 

66,898

 

End of period

 

$

49,796

 

 

$

83,722

 

 

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements prepared and presented in accordance with U.S. generally accepted accounting principles, or GAAP, our key non-GAAP performance measures include adjusted EBITDA and non-GAAP net income (loss), as defined below. We use adjusted EBITDA and non-GAAP net income (loss) as key measures to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operating plans. We believe these measures provide useful information for period-to-period comparisons of our business to allow investors and others to understand and evaluate our operating results in the same manner as our management and board of directors. Our presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP, and our non-GAAP measures may be different from similarly termed non-GAAP measures used by other companies.

Adjusted EBITDA

We define adjusted EBITDA as net income (loss) determined in accordance with GAAP, excluding, if applicable for the periods presented, the effects of stock-based compensation; depreciation; investigation costs; restructuring costs; settlement and related costs; other income, net; interest expense; loss on debt extinguishment; and income tax benefit (expense).

Non-GAAP Net Income (Loss)

We define non-GAAP net income (loss) as net income (loss), excluding, if applicable for the periods presented, the effects of stock-based compensation; depreciation; investigation costs; restructuring costs; settlement and related costs; amortization of debt discount related to the equity component of our convertible notes prior to the adoption of ASU 2020-06; and prepayment penalty on debt extinguishment.

On January 1, 2021, we adopted ASU 2020-06 using the modified retrospective transition method, accounting for the 2019 Notes on a whole-instrument basis. Upon adoption, the condensed consolidated financial statements for the three months ended March 31, 2021 are presented under the new standard and we no longer recorded amortization of debt discount, and comparative prior reporting period presented is not adjusted.

 

IMPINJ, INC.

RECONCILIATIONS OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES

(in thousands, except percentages, unaudited)

 

 

 

Three Months Ended

 

 

March 31,

 

 

 

2021

 

 

 

2020

 

GAAP Gross margin

 

 

48.6

%

 

 

44.7

%

Adjustments:

 

 

 

 

Depreciation

 

 

1.1

%

 

 

1.0

%

Stock-based compensation

 

 

0.6

%

 

 

0.4

%

Non-GAAP Gross margin

 

 

50.3

%

 

 

46.1

%

 

 

 

 

 

GAAP Net loss

 

$

(9,416

)

 

$

(4,326

)

Adjustments:

 

 

 

 

Depreciation

 

 

1,040

 

 

 

1,168

 

Stock-based compensation

 

 

7,449

 

 

 

5,221

 

Other income, net

 

 

(23

)

 

 

(409

)

Interest expense

 

 

525

 

 

 

1,312

 

Income tax expense

 

 

42

 

 

 

28

 

Restructuring costs

 

 

1,263

 

 

 

 

Adjusted EBITDA

 

$

880

 

 

$

2,994

 

 

 

 

 

 

GAAP Net loss

 

$

(9,416

)

 

$

(4,326

)

Adjustments:

 

 

 

 

Depreciation

 

 

1,040

 

 

 

1,168

 

Stock-based compensation

 

 

7,449

 

 

 

5,221

 

Amortization of debt discount

 

 

 

 

 

854

 

Restructuring costs

 

 

1,263

 

 

 

 

Non-GAAP Net income (loss)

 

$

336

 

 

$

2,917

 

Non-GAAP Net income (loss) per share:

 

 

 

 

Basic

 

$

0.01

 

 

$

0.13

 

Diluted

 

$

0.01

 

 

$

0.13

 

GAAP and non-GAAP Weighted-average shares — basic

 

 

23,671

 

 

 

22,412

 

 

 

 

 

 

GAAP Weighted-average shares — diluted

 

 

23,671

 

 

 

22,412

 

Dilutive shares from stock plans

 

 

1,983

 

 

 

589

 

Non-GAAP Weighted-average shares — diluted

 

 

25,654

 

 

 

23,001

 

 

IMPINJ, INC.

RECONCILIATIONS OF GAAP FINANCIAL OUTLOOK TO NON-GAAP FINANCIAL OUTLOOK

(in thousands, except per share data, unaudited – calculated at the midpoint of the outlook range)

 

 

 

Three Months Ending

 

 

June 30,

 

 

 

2021

 

GAAP Net loss

 

$

(10,950

)

Adjustments:

 

 

Forecasted Depreciation

 

 

1,500

 

Forecasted Stock-based compensation

 

 

8,200

 

Forecasted Interest expense

 

 

525

 

Forecasted Other income, net

 

 

(25

)

Forecasted Income tax expense

 

 

 

Adjusted EBITDA loss

 

$

(750

)

 

 

 

GAAP Net loss

 

$

(10,950

)

Adjustments:

 

 

Forecasted Depreciation

 

 

1,500

 

Forecasted Stock-based compensation

 

 

8,200

 

Non-GAAP Net loss

 

$

(1,250

)

 

 

 

GAAP Net loss per share — basic and diluted

 

$

(0.45

)

Non-GAAP Net loss per share — basic and diluted

 

$

(0.05

)

 

 

 

GAAP weighted-average shares — basic and diluted

 

 

24,200

 

Non-GAAP weighted-average shares — basic and diluted

 

 

24,200