Netlist: Fiscal 3Q16 Financial Results

Fast revenue growtih with continuing losses
This is a Press Release edited by on 2016.11.15

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(in $ million) 3Q15 3Q16 9 mo. 16 9 mo. 16
Revenues 1.6 2.6 5.2 14.1
Growth   60%   174%
Net income (loss) (5.4) (4.4) (16.2) (7.3)

Netlist, Inc. reported financial results for the third quarter ended October 1, 2016.

Revenues for the quarter ended October 1, 2016, were $2.6 million, up 60% from revenues of $1.6 million for the quarter ended September 26, 2015. 

Gross profit for the quarter ended October 1, 2016, was $9,000, or 0.3% of revenues compared to a gross profit of $24,000, or 1.5% of revenues for the quarter ended September 26, 2015.

Net loss for the quarter ended October 1, 2016, was ($4.4) million, or ($0.08) loss per share, compared to a net loss in the prior year period of ($5.4) million, or ($0.11) loss per share. 

These results include stock-based compensation expense of $0.3 million for the third quarter of 2016 and $0.4 million for the prior year period.

"During the third quarter we made significant progress in the execution of our strategic initiatives," said C.K. Hong, CEO. "In August we introduced our HybriDIMM storage class memory solution and remain on track to bring this innovative product to market next year. In September we filed a complaint in the U.S. International Trade Commission against SK hynix for infringement of six of our patents covering billions of dollars of their high performance memory. In addition, we achieved year over year product revenue growth from a new base of OEM and data center customers. We believe that our actions in the quarter have set the stage for growth and diversification as we enter 2017."

As of October 1, 2016, cash and cash equivalents and restricted cash were $16.5 million, total assets were $23.2 million, working capital was $16.4 million, total debt, net of debt discounts, was $14.3 million, and stockholders' equity was $3.0 million.

Our Comments

Abstracts of the earnings call transcript:

Gail Sasaki, CFO:
"Quarter-over-quarter our product revenue was down reflecting the bumpy nature of the Samsung product revenue, which we believe will become are predictable as we continue to product our customer base.
"Also as a reminder, we recognized $3.4 million in NRE from Samsung during the prior quarter as we completed initial phase of our product development work together on HybriDIMM.
"We expect to see significantly improved Q4 2016 product revenues of consecutive and year-over-year basis."