Everspin: Fiscal 3Q20 Financial Results

(in $ million)	3Q19	3Q20	9 mo. 19	9 mo. 20
Revenue	9.2	10.1	27.9	32.1
*Growth*		10%		*15%*
Net income (loss)	(3.7)	(3.9)	(11.6)	(6.9)

Everspin Technologies, Inc. announced financial results for the third quarter ended September 30, 2020.

3FQ20 Highlights

Total revenue increased 10.3% Y/Y to $10.1 million
Operating expenses declined 24% over the prior year period
GAAP net loss per share remained flat at ($0.21) compared to the third quarter of 2019
Generated $0.7 million cash flow from operations
Ended quarter with cash and equivalents of $13.9 million

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“We are happy to report that in Q3 we achieved our goal of generating cash flow from operations. We hit our target of reducing annual operating expenses by $5 million over last year one quarter ahead of plan, while maintaining our critical R&D programs and key business initiatives,” stated Kevin Conley, president and CEO. “Our emphasis on cash management, product cost, and operational excellence have been fundamental to our continued progress.

“During the quarter, we started production shipments of our second STT-MRAM design win for a persistent memory card application with an OEM customer that sells into the data center segment. Combined with the expansion of our Toggle product line, we believe that we are well positioned to drive revenue growth as the overall demand for memory and storage increases and applications that benefit from the performance and reliability of MRAM continue to expand.”

3FQ20 Results

Revenue was $10.1 million, compared to $11.8 million in 2FQ20 and $9.2 million in 3FQ19.
GAAP gross margin was 23.0%, compared to 43.9% in 2FQ20 and 47.4% in 3FQ19. Gross margin included a $1.7 million non-cash charge related to excess and obsolete inventory reserve, $0.4 million of accelerated depreciation and $0.1 million related to a prior period cost adjustment.
GAAP operating expenses decreased to $6.0 million, compared to $6.3 million in 2FQ20 and $7.9 million in 3FQ19. GAAP operating expenses in each of these periods included $0.9 million of stock-based compensation.
GAAP net loss was $3.9 million, or ($0.21) per share, based on 18.9 million weighted-average shares outstanding. This compares to a GAAP net loss of $1.3 million, or ($0.07) per share in 2FQ20 and a GAAP net loss of $3.7 million, or ($0.21) per share, in 3FQ19.
Adjusted EBITDA was a negative ($2.0) million, compared to a positive $0.2 million 2FQ20 and a negative ($2.2) million in 3FQ19.
Cash and cash equivalents as of September 30, 2020 increased to $13.9 million compared to $12.9 million at the end of 2FQ20.

Business Outlook
For 4FQ20, the company expects total revenue in a range between $10.1 million and $10.9 million, which at the mid-point represents an 8.7% increase over total revenue of $9.7 million in 4FQ19. GAAP net loss per share is expected to range between ($0.10) and ($0.04) per share, which reflects expected stock-based compensation expense of approximately $0.9 million.