Sphere 3D: Fiscal 4Q19 Financial Results

Sphere 3D Corp. reported financial results for its fiscal year ended December 31, 2019

On November 13, 2018, the company closed the divestiture of its Overland subsidiary and related business. Beginning in 4FQ18, the financial results of Overland for fiscal years 2019 and 2018 have been reflected in the company’s consolidated statements of operations as discontinued operations. All results below exclude discontinued operations. 

Results for FY19:
• Net revenue for 2019 was $5.6 million, compared to $9.0 million for FY18.
• Gross margin for 2019 was 33.2%, compared to 18.6% for FY18.
• Operating expenses for 2019 were $7.9 million, compared to $14.3 million for FY18.
• Share-based compensation expense for 2019 was $0.6 million, compared to $1.6 million for FY18. Depreciation and amortization was $1.9 million for 2019, compared to $1.7 million for FY18.
• Net loss from continuing operations was $4.3 million, or a net loss of $1.59 per share, compared to a net loss from continuing operations of $12.7 million, or a net loss of $7.65 per share, for FY18.
• Net loss from discontinued operations for FY19 was $13.5 million, or a net loss of $8.15 per share.

Subsequent to Year End:
• On April 30, 2020, the company entered into a Securities Purchase Agreement relating to the issuance and sale, in the aggregate, 1,694,000 shares of the company’s Series D Convertible Preferred Stock, no par value and warrants to purchase up to 1,694,000 common shares of the company in a private placement transaction for a value of $1.1 million. This transaction combined with the conversion of the below convertible debentures, which were both completed after the reporting period, have increased the company’s equity balance by adding approximately $1.5 million to the equity balance that was reported as of December 31, 2019.
• Between April 7, 2020 and April 24, 2020, the company converted $377,000 of convertible debentures and issued 580,580 common shares of the company, of which 271,040 common shares were issued to related parties.