ClearOne, Inc. Reports First Quarter 2022 Financial Results
- Quarterly overall Year-over-Year Revenue up by 7%
- Sequential quarterly revenue up by 5%
- Strong performance from microphone, core audio conferencing, and personal conferencing products drive revenue growth
"We are pleased with a strong start to 2022. Notwithstanding the significant challenges posed by the global supply chain crisis that have deeply impacted our industry negatively,
"Our gross margin continues to be challenged by various factors including the increase in material costs of critical electronic components due to the once-in-a-generation extraordinary global supply chain crisis, as well as burgeoning inflation causing freight, labor, and general cost increases in the production and logistics chain,” Hakimoglu added.
“We are committed to realizing the full potential of our business by focusing on factors that are within our control through timely and decisive strategic planning and decision making. This includes driving our global team to meet our 2022 goals to launch a host of new innovative products that we believe will intercept important new market demands while bringing fresh revenue opportunities to
Recent Highlights
- In
March 2022 , the Company filed motions asking theU.S. District Court of Northern Illinois to schedule trial dates for two key cases thatClearOne filed against Shure in that District Court, which together allege patent infringement of threeClearOne patents and misappropriation of ClearOne’s trade secrets. The Court denied that request without prejudice inApril 2022 . - In
January 2022 , the Company filed a motion asking theU.S. District Court of Delaware to schedule a trial date on ClearOne’s counterclaims of unfair competition and tortious interference with business relations. Shure opposed that motion and asked the Court to stay proceedings on ClearOne’s counterclaims. The Court has yet to decide on these motions. - This week, our BMA 360 was awarded the prestigious Best in Market Award at Integrated Systems Europe (ISE), the world’s largest AV and systems integration show. The microphone was one of only three winners in this year’s program presented by leading industry publication Sound & Video Contractor. The 2022 Best in Market Awards is the BMA 360’s sixth industry accolade since its launch in 2020.
- Also in May, DIALOG ® 10, the industry’s only pro-quality single-channel wireless USB microphone system won a 2022 Top New Technology (TNT) Award in the Microphone category. TNT Awards recognize new and outstanding products and services in the commercial and residential AV industry and this program is hosted by industry-leading publications CE Pro and Commercial Integrator. This is the second win for DIALOG 10 having won a 2022 NSCA Excellence in Product Innovation Award in
February 2022 .
Financial Summary
The Company uses certain non-GAAP financial measures and reconciles those to GAAP measures in the attached tables.
- Revenue in 2022-Q1 was
$7.5 million , compared to$7.0 million in 2021-Q1 and$7.2 million in 2021-Q4. The increase in year-over-year revenue was mainly due to a 23% increase in microphones and a 13% increase in audio conferencing products which were partially offset by a 22% decrease in video products. Increase in revenue from microphones and core audio conferencing products continued to be driven by our new solutions incorporating our beamforming BMA-CT and BMA 360 array ceiling tiles and professional audio mixers. Despite this year-over-year revenue growth in microphones and core audio conferencing products, revenue from our audio conferencing products and microphones remain far below levels achieved prior to infringement of our strategic patents. - GAAP gross profit in 2022-Q1 was
$2.8 million compared to$3.0 million in 2021-Q1 and$2.6 million in 2021-Q4. GAAP gross profit margin was 37.3% in 2022-Q1, compared to 42.7% in 2021-Q1 and 36.6% in 2021-Q4. The gross profit margin was negatively impacted due to increase in material costs due to continuing supply chain constraints, and increased freight and tariff costs, which were partially offset by the absence of inventory obsolescence costs in 2022-Q1. - Operating expenses in 2022-Q1 were
$4.7 million , compared to$4.5 million in 2021-Q1 and$5.1 million in 2021-Q4. Non-GAAP operating expenses in 2022-Q1 were$4.0 million , compared to$4.0 million in 2021-Q1 and$4.4 million in 2021-Q4. - GAAP net loss in 2022-Q1 was
$2.0 million , or$0.08 per share, compared to net loss of$1.7 million , or$0.09 per share, in 2021-Q1 and net loss of$2.3 million , or$0.10 per share, in 2021-Q4. Non-GAAP net loss in 2022-Q1 was$1.3 million , or$0.05 per share, compared to net loss of$1.1 million , or$0.06 per share, in 2021-Q1 and net loss of$1.6 million , or$0.07 per share, in 2021-Q4. The year-over-year increase in Non-GAAP was primarily due to reduced gross profit caused by higher cost of goods sold as a percentage of revenue.
($ in 000, except per share) |
|
Three months ended |
|
|||||||
|
|
2022 |
|
|
|
2021 |
|
|
Change in % Favorable/(Adverse) |
|
GAAP |
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
7,545 |
|
|
$ |
7,038 |
|
|
7 |
|
Gross profit |
|
2,816 |
|
|
|
3,003 |
|
|
(6 |
) |
Operating expenses |
|
4,669 |
|
|
|
4,527 |
|
|
(3 |
) |
Operating loss |
|
(1,853 |
) |
|
|
(1,524 |
) |
|
(22 |
) |
Net loss |
|
(1,967 |
) |
|
|
(1,655 |
) |
|
(19 |
) |
Diluted loss per share |
|
(0.08 |
) |
|
|
(0.09 |
) |
|
11 |
|
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
Non-GAAP gross profit |
$ |
2,818 |
|
|
$ |
3,006 |
|
|
(6 |
) |
Non-GAAP operating expenses |
|
3,966 |
|
|
3,988 |
|
|
1 |
|
|
Non-GAAP operating loss |
|
(1,148 |
) |
|
|
(982 |
) |
|
(17 |
) |
Non-GAAP net loss |
|
(1,262 |
) |
|
|
(1,113 |
) |
|
(13 |
) |
Non-GAAP Adjusted EBITDA |
|
(1,069 |
) |
|
|
(886 |
) |
|
(21 |
) |
Non-GAAP loss per share (diluted) |
|
(0.05 |
) |
|
|
(0.06 |
) |
|
17 |
|
Balance Sheet Highlights
As of
About
Non-GAAP Financial Measures
To supplement our consolidated financial statements presented on a GAAP basis,
Forward Looking Statements
This release contains “forward-looking” statements that are based on present circumstances and on ClearOne’s predictions with respect to events that have not occurred, that may not occur, or that may occur with different consequences and timing than those now assumed or anticipated. Such forward-looking statements and any statements of the plans and objectives of management for future operations and forecasts of future growth and value and the possible outcomes of litigation, are not guarantees of future performance or results and involve risks and uncertainties that could cause actual events or results to differ materially from the events or results described in the forward-looking statements. Such forward-looking statements are made only as of the date of this release and
In particular, the financial information contained herein is subject to and qualified by reference to the financial statements contained in the 10-Q, including the footnotes thereto, as well as the Company’s annual report on Form 10-K for the year ended
|
||||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
(Dollars in thousands, except par value) |
||||||||
|
|
|
|
|
||||
ASSETS |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
1,422 |
|
|
$ |
1,071 |
|
Marketable securities |
|
|
398 |
|
|
|
1,790 |
|
Receivables, net of allowance for doubtful accounts of |
|
|
5,077 |
|
|
|
4,991 |
|
Inventories, net |
|
|
9,865 |
|
|
|
10,033 |
|
Income tax receivable |
|
|
7,540 |
|
|
|
7,535 |
|
Prepaid expenses and other assets |
|
|
3,370 |
|
|
|
4,021 |
|
Total current assets |
|
|
27,672 |
|
|
|
29,441 |
|
Long-term marketable securities |
|
|
542 |
|
|
|
1,220 |
|
Long-term inventories, net |
|
|
3,210 |
|
|
|
3,567 |
|
Property and equipment, net |
|
|
676 |
|
|
|
744 |
|
Operating lease - right of use assets, net |
|
|
1,383 |
|
|
|
1,537 |
|
Intangibles, net |
|
|
24,675 |
|
|
|
25,086 |
|
Other assets |
|
|
4,596 |
|
|
|
4,597 |
|
Total assets |
|
$ |
62,754 |
|
|
$ |
66,192 |
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Accounts payable |
|
$ |
4,125 |
|
|
$ |
5,388 |
|
Accrued liabilities |
|
|
2,826 |
|
|
|
2,549 |
|
Deferred product revenue |
|
|
46 |
|
|
|
54 |
|
Short-term debt |
|
|
1,336 |
|
|
|
3,481 |
|
Total current liabilities |
|
|
8,333 |
|
|
|
11,472 |
|
Long-term debt, net |
|
|
1,359 |
|
|
|
1,535 |
|
Operating lease liability, net of current |
|
|
871 |
|
|
|
1,026 |
|
Other long-term liabilities |
|
|
655 |
|
|
|
655 |
|
Total liabilities |
|
|
11,218 |
|
|
|
14,688 |
|
|
|
|
|
|
||||
Shareholders' equity: |
|
|
|
|
||||
Common stock, par value |
|
|
24 |
|
|
|
22 |
|
Additional paid-in capital |
|
|
74,831 |
|
|
|
72,795 |
|
Accumulated other comprehensive loss |
|
|
(280 |
) |
|
|
(241 |
) |
Accumulated deficit |
|
|
(23,039 |
) |
|
|
(21,072 |
) |
Total shareholders' equity |
|
|
51,536 |
|
|
|
51,504 |
|
Total liabilities and shareholders' equity |
|
$ |
62,754 |
|
|
$ |
66,192 |
|
|
||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
||||||||
(Dollars in thousands, except per share values) |
||||||||
|
|
Three months ended |
||||||
|
|
2022 |
|
2021 |
||||
Revenue |
|
$ |
7,545 |
|
|
$ |
7,038 |
|
Cost of goods sold |
|
|
4,729 |
|
|
|
4,035 |
|
Gross profit |
|
|
2,816 |
|
|
|
3,003 |
|
|
|
|
|
|
||||
Operating expenses: |
|
|
|
|
||||
Sales and marketing |
|
|
1,560 |
|
|
|
1,573 |
|
Research and product development |
|
|
1,353 |
|
|
|
1,274 |
|
General and administrative |
|
|
1,756 |
|
|
|
1,680 |
|
Total operating expenses |
|
|
4,669 |
|
|
|
4,527 |
|
|
|
|
|
|
||||
Operating loss |
|
|
(1,853 |
) |
|
|
(1,524 |
) |
|
|
|
|
|
||||
Interest expense |
|
|
(101 |
) |
|
|
(112 |
) |
Other income, net |
|
|
3 |
|
|
|
(5 |
) |
|
|
|
|
|
||||
Loss before income taxes |
|
|
(1,951 |
) |
|
|
(1,641 |
) |
|
|
|
|
|
||||
Provision for income taxes |
|
|
16 |
|
|
|
14 |
|
|
|
|
|
|
||||
Net loss |
|
$ |
(1,967 |
) |
|
$ |
(1,655 |
) |
|
|
|
|
|
||||
Basic weighted average shares outstanding |
|
|
23,897,305 |
|
|
|
18,775,773 |
|
Diluted weighted average shares outstanding |
|
|
23,897,305 |
|
|
|
18,775,773 |
|
|
|
|
|
|
||||
Basic loss per share |
|
$ |
(0.08 |
) |
|
$ |
(0.09 |
) |
Diluted loss per share |
|
$ |
(0.08 |
) |
|
$ |
(0.09 |
) |
|
|
|
|
|
||||
Comprehensive loss: |
|
|
|
|
||||
Net loss |
|
|
(1,967 |
) |
|
|
(1,655 |
) |
Unrealized gain (loss) on available-for-sale securities, net of tax |
|
|
(28 |
) |
|
|
(2 |
) |
Change in foreign currency translation adjustment |
|
|
(11 |
) |
|
|
(12 |
) |
Comprehensive loss |
|
|
(2,006 |
) |
|
|
(1,669 |
) |
|
||||||||
UNAUDITED RECONCILIATION OF GAAP MEASURES TO NON-GAAP MEASURES |
||||||||
(Dollars in thousands, except per share values) |
||||||||
|
|
Three months ended |
||||||
|
|
2022 |
|
2021 |
||||
GAAP gross profit |
|
$ |
2,816 |
|
|
$ |
3,003 |
|
Stock-based compensation |
|
|
2 |
|
|
|
3 |
|
Non-GAAP gross profit |
|
$ |
2,818 |
|
|
$ |
3,006 |
|
|
|
|
|
|
||||
GAAP operating loss |
|
$ |
(1,853 |
) |
|
$ |
(1,524 |
) |
Stock-based compensation |
|
|
35 |
|
|
|
31 |
|
Amortization of intangibles |
|
|
670 |
|
|
|
511 |
|
Non-GAAP operating loss |
|
$ |
(1,148 |
) |
|
$ |
(982 |
) |
|
|
|
|
|
||||
GAAP net loss |
|
$ |
(1,967 |
) |
|
$ |
(1,655 |
) |
Stock-based compensation |
|
|
35 |
|
|
|
31 |
|
Amortization of intangibles |
|
|
670 |
|
|
|
511 |
|
Non-GAAP net loss |
|
$ |
(1,262 |
) |
|
$ |
(1,113 |
) |
|
|
|
|
|
||||
GAAP net loss |
|
$ |
(1,967 |
) |
|
$ |
(1,655 |
) |
Number of shares used in computing GAAP loss per share (diluted) |
|
|
23,897,305 |
|
|
|
18,775,773 |
|
GAAP loss per share (diluted) |
|
$ |
(0.08 |
) |
|
$ |
(0.09 |
) |
Non-GAAP net loss |
|
$ |
(1,262 |
) |
|
$ |
(1,113 |
) |
Number of shares used in computing Non-GAAP loss per share (diluted) |
|
|
23,897,305 |
|
|
|
18,775,773 |
|
Non-GAAP loss per share (diluted) |
|
$ |
(0.05 |
) |
|
$ |
(0.06 |
) |
|
|
|
|
|
||||
GAAP net loss |
|
$ |
(1,967 |
) |
|
$ |
(1,655 |
) |
Stock-based compensation |
|
|
35 |
|
|
|
31 |
|
Depreciation |
|
|
76 |
|
|
|
101 |
|
Amortization of intangibles |
|
|
670 |
|
|
|
511 |
|
Interest expense |
|
|
101 |
|
|
|
112 |
|
Provision for income taxes |
|
|
16 |
|
|
|
14 |
|
Non-GAAP Adjusted EBITDA |
|
$ |
(1,069 |
) |
|
$ |
(886 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20220519006032/en/
801-975-7200
investor_relations@clearone.com
http://investors.clearone.com
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