- Fourth quarter revenues of
$56.6 million , in line with previous guidance - Fourth quarter GAAP net loss of
$22.9 million ; non-GAAP net income of$3.8 million - Achieved breakeven adjusted EBITDA and generated positive operating cash flow for the fourth quarter
- Successfully launched the Apollo platform for general commercial use in early 2024
- Expecting modest revenue growth, adjusted EBITDA profitability, and positive operating cash flow for the full year 2024
ROSH-HA`AYIN,
“We experienced a healthy peak season, with year-over-year growth in impressions and double-digit growth in high-margin consumable sales.” said
Fourth Quarter 2023 Results of Operations
- Total revenue for the fourth quarter of 2023 was
$56.6 million compared with$63.3 million in the prior year period, due primarily to lower systems revenues. - GAAP gross profit margin for the fourth quarter of 2023 was 25.8% compared with 33.7% in the prior year period. On a non-GAAP basis, gross profit margin was 48.6% compared with 36.4% in the prior year period.
- GAAP operating expenses for the fourth quarter of 2023 were
$42.4 million compared with$38.1 million in the prior year period. On a non-GAAP basis, operating expenses decreased by 8.7% to$30.1 million compared with the prior year period. - GAAP net loss for the fourth quarter of 2023 was
$22.9 million , or ($0.48 ) per basic share, compared with net loss of$35.4 million , or ($0.71 ) per basic share, for the fourth quarter of 2022. - Non-GAAP net income for the fourth quarter of 2023 was
$3.8 million , or$0.08 per diluted share, compared with non-GAAP net loss of$6.6 million , or ($0.13 ) per basic share, for the fourth quarter of 2022. - Adjusted EBITDA for the fourth quarter of 2023 was
$0.2 million compared with adjusted EBITDA loss of$6.1 million for the fourth quarter of 2022. Adjusted EBITDA margin for the fourth quarter of 2023 was 0.3% compared with -9.6% for the fourth quarter of 2022.
Full Year 2023 Results of Operations
- Total revenue for the full year 2023 was
$219.8 million compared with$271.5 million in the prior year, due primarily to lower systems revenues. - GAAP gross profit margin for the full year 2023 was 30.5% compared with 35.5% in the prior year. On a non-GAAP basis, gross profit margin was 38.4% compared with 38.2% in the prior year.
- GAAP operating expenses for the full year 2023 were
$154.5 million compared with$166.4 million in the prior year. On a non-GAAP basis, operating expenses decreased by 12.3% to$127.7 million compared with the prior year. - GAAP net loss for the full year 2023 was
$64.4 million , or ($1.31 ) per basic share, compared with net loss of$79.1 million , or ($1.59 ) per basic share, for the full year 2022. - Non-GAAP net loss for the full year 2023 was
$20.4 million , or ($0.42 ) per basic share, compared with non-GAAP net loss of$32.6 million , or ($0.66 ) per basic share, for the full year 2022. - Adjusted EBITDA loss for the full year 2023 was
$30.9 million compared with adjusted EBITDA loss of$30.8 million for the full year 2022. Adjusted EBITDA margin for the full year 2023 was -14.0% compared with -11.3% for the full year 2022.
First Quarter 2024 Guidance
For the first quarter of 2024, the Company expects revenues to be in the range of
Fourth Quarter and Full Year 2023 Earnings Conference Call Information
The Company will host a conference call today at
A live webcast of the call can be accessed at ir.kornit.com. To access the call, participants may dial toll-free at 1-877-407-0792 or 1-201-689-8263. The toll-free Israeli number is 1 809 406 247. The conference confirmation code is 13744080.
To listen to a replay of the conference call, dial toll-free 1-844-512-2921 or 1-412-317-6671 (international) and enter confirmation code 13744080. The telephonic replay will be available approximately three hours after the completion of the live call until
About
Forward Looking Statements
Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and other
Non-GAAP Discussion Disclosure
The Company presents certain non-GAAP financial measures, in this press release and in the accompanying conference call to discuss the Company’s quarterly results. These non-GAAP financial measures reflect adjustments to corresponding GAAP financial measures in order to exclude the impact of the following: share-based compensation expenses; amortization of intangible assets; acquisition related expenses; restructuring expenses; foreign exchange differences associated with ASC 842; and non-cash deferred tax income.
The Company defines “Adjusted EBITDA” as non-GAAP operating income (loss), which reflects the adjustments described in the preceding paragraph, as further adjusted to exclude depreciation expense.
The purpose of the foregoing non-GAAP financial measures is to convey the Company’s performance exclusive of non-cash charges and other items that are considered by management to be outside of the Company’s core operating results. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Furthermore, the non-GAAP measures are regularly used internally to understand, manage, and evaluate the Company’s business and make operating decisions, and the Company believes that they are useful to investors as a consistent and comparable measure of the ongoing performance of the Company’s business. The Company’s non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies.
The reconciliation tables included below present a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP financial measures.
Investor Contact:
Global Head of Investor Relations
Jared.Maymon@Kornit.com
AND ITS SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
( | ||||||||
2023 | 2022 | |||||||
(Unaudited) | (Audited) | |||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents | $ | 39,605 | $ | 104,597 | ||||
Short-term bank deposit | 235,600 | 275,033 | ||||||
Marketable securities | 57,292 | 20,380 | ||||||
Trade receivables, net | 93,632 | 67,360 | ||||||
Inventory | 67,712 | 89,415 | ||||||
Other accounts receivable and prepaid expenses | 28,546 | 22,054 | ||||||
Total current assets | 522,387 | 578,839 | ||||||
LONG-TERM ASSETS: | ||||||||
Marketable securities | 223,203 | 245,970 | ||||||
Deposits and other long-term assets | 8,209 | 5,927 | ||||||
Severance pay fund | 283 | 274 | ||||||
Property,plant and equipment, net | 50,905 | 60,463 | ||||||
Operating lease right-of-use assets | 23,782 | 27,139 | ||||||
Intangible assets, net | 7,647 | 9,890 | ||||||
29,164 | 29,164 | |||||||
Total long-term assets | 343,193 | 378,827 | ||||||
Total assets | 865,580 | 957,666 | ||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
CURRENT LIABILITIES: | ||||||||
Trade payables | 6,936 | 14,833 | ||||||
Employees and payroll accruals | 12,121 | 14,255 | ||||||
Deferred revenues and advances from customers | 2,158 | 5,701 | ||||||
Operating lease liabilities | 4,345 | 4,989 | ||||||
Other payables and accrued expenses | 23,814 | 25,592 | ||||||
Total current liabilities | 49,374 | 65,370 | ||||||
LONG-TERM LIABILITIES: | ||||||||
Accrued severance pay | 1,080 | 1,223 | ||||||
Operating lease liabilities | 19,261 | 21,035 | ||||||
Other long-term liabilities | 198 | 1,216 | ||||||
Total long-term liabilities | 20,539 | 23,474 | ||||||
SHAREHOLDERS' EQUITY | 795,667 | 868,822 | ||||||
Total liabilities and shareholders' equity | $ | 865,580 | $ | 957,666 | ||||
AND ITS SUBSIDIARIES | |||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
( | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
(Unaudited) | (Unaudited) | Audited | |||||||||||||
Revenues | |||||||||||||||
Products | $ | 43,573 | $ | 49,795 | $ | 161,045 | $ | 222,502 | |||||||
Services | 13,012 | 13,503 | 58,741 | 49,016 | |||||||||||
Total revenues | 56,585 | 63,298 | 219,786 | 271,518 | |||||||||||
Cost of revenues | |||||||||||||||
Products | 23,125 | 29,026 | 91,516 | 125,935 | |||||||||||
Services | 18,888 | 12,923 | 61,313 | 49,083 | |||||||||||
Total cost of revenues | 42,013 | 41,949 | 152,829 | 175,018 | |||||||||||
Gross profit | 14,572 | 21,349 | 66,957 | 96,500 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development, net | 12,033 | 13,251 | 50,060 | 56,026 | |||||||||||
Sales and marketing | 17,909 | 16,150 | 66,836 | 71,067 | |||||||||||
General and administrative | 12,449 | 8,657 | 37,592 | 39,289 | |||||||||||
Total operating expenses | 42,391 | 38,058 | 154,488 | 166,382 | |||||||||||
Operating loss | (27,819 | ) | (16,709 | ) | (87,531 | ) | (69,882 | ) | |||||||
Financial income, net | 5,424 | 5,052 | 24,150 | 13,382 | |||||||||||
Loss before taxes on income | (22,395 | ) | (11,657 | ) | (63,381 | ) | (56,500 | ) | |||||||
Taxes on income | 539 | 23,703 | 970 | 22,565 | |||||||||||
Net loss | $ | (22,934 | ) | $ | (35,360 | ) | $ | (64,351 | ) | $ | (79,065 | ) | |||
Basic loss per share | $ | (0.48 | ) | $ | (0.71 | ) | $ | (1.31 | ) | $ | (1.59 | ) | |||
Weighted average number of shares | |||||||||||||||
used in computing basic net loss per share | 48,231,916 | 49,913,898 | 49,160,266 | 49,791,659 | |||||||||||
Diluted net loss per share | $ | (0.48 | ) | $ | (0.71 | ) | $ | (1.31 | ) | $ | (1.59 | ) | |||
Weighted average number of shares | |||||||||||||||
used in computing diluted net loss per share | 48,231,916 | 49,913,898 | 49,160,266 | 49,791,659 | |||||||||||
AND ITS SUBSIDIARIES | |||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
( | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||
Revenues | $ | 56,585 | $ | 63,298 | $ | 219,786 | $ | 271,518 | |||||||
GAAP cost of revenues | $ | 42,013 | $ | 41,949 | $ | 152,829 | $ | 175,018 | |||||||
Cost of product recorded for share-based compensation (1) | (545 | ) | (543 | ) | (2,356 | ) | (2,185 | ) | |||||||
Cost of service recorded for share-based compensation (1) | (447 | ) | (408 | ) | (1,758 | ) | (1,676 | ) | |||||||
Intangible assets amortization on cost of product (3) | (260 | ) | (266 | ) | (1,053 | ) | (1,402 | ) | |||||||
Intangible assets amortization on cost of service (3) | (160 | ) | (160 | ) | (640 | ) | (640 | ) | |||||||
Excess cost of product on acquired inventory (2) | - | - | - | (663 | ) | ||||||||||
Restructuring expenses (4) | (11,501 | ) | (305 | ) | (11,590 | ) | (701 | ) | |||||||
Non-GAAP cost of revenues | $ | 29,100 | $ | 40,267 | $ | 135,432 | $ | 167,751 | |||||||
GAAP gross profit | $ | 14,572 | $ | 21,349 | $ | 66,957 | $ | 96,500 | |||||||
Gross profit adjustments | 12,913 | 1,682 | 17,397 | 7,267 | |||||||||||
Non-GAAP gross profit | $ | 27,485 | $ | 23,031 | $ | 84,354 | $ | 103,767 | |||||||
GAAP operating expenses | $ | 42,391 | $ | 38,058 | $ | 154,488 | $ | 166,382 | |||||||
Share-based compensation (1) | (4,653 | ) | (4,264 | ) | (18,475 | ) | (18,788 | ) | |||||||
Acquisition related expenses (2) | - | - | - | (512 | ) | ||||||||||
Intangible assets amortization (3) | (93 | ) | (138 | ) | (550 | ) | (501 | ) | |||||||
Restructuring expenses (4) | (7,579 | ) | (711 | ) | (7,785 | ) | (992 | ) | |||||||
Non-GAAP operating expenses | $ | 30,066 | $ | 32,945 | $ | 127,678 | $ | 145,589 | |||||||
GAAP Financial income, net | $ | 5,424 | $ | 5,052 | $ | 24,150 | $ | 13,382 | |||||||
Foreign exchange losses associated with ASC 842 | 1,579 | 285 | 378 | (3,123 | ) | ||||||||||
Non-GAAP Financial income , net | $ | 7,003 | $ | 5,337 | $ | 24,528 | $ | 10,259 | |||||||
GAAP Taxes on income | $ | 539 | $ | 23,703 | $ | 970 | $ | 22,565 | |||||||
Non-cash deferred tax income (expenses) | $ | 88 | $ | (10,234 | ) | $ | 666 | $ | (10,014 | ) | |||||
Non-recurring tax payment (a) | $ | - | $ | (11,485 | ) | $ | - | $ | (11,485 | ) | |||||
Non-GAAP Taxes on income | $ | 627 | $ | 1,984 | $ | 1,636 | $ | 1,066 | |||||||
GAAP net loss | $ | (22,934 | ) | $ | (35,360 | ) | $ | (64,351 | ) | $ | (79,065 | ) | |||
Share-based compensation (1) | 5,645 | 5,215 | 22,589 | 22,649 | |||||||||||
Acquisition related expenses (2) | - | - | - | 512 | |||||||||||
Intangible assets amortization (3) | 513 | 564 | 2,243 | 2,543 | |||||||||||
Restructuring expenses (4) | 19,080 | 1,016 | 19,375 | 1,693 | |||||||||||
Excess cost of product on acquired inventory (2) | - | - | - | 663 | |||||||||||
Foreign exchange losses associated with ASC 842 | 1,579 | 285 | 378 | (3,123 | ) | ||||||||||
Non-cash deferred tax expenses (income) | (88 | ) | 10,234 | (666 | ) | 10,014 | |||||||||
Non-recurring tax payment (a) | - | 11,485 | - | 11,485 | |||||||||||
Non-GAAP net income (loss) | $ | 3,795 | $ | (6,561 | ) | $ | (20,432 | ) | $ | (32,629 | ) | ||||
GAAP diluted loss per share | $ | (0.48 | ) | $ | (0.71 | ) | $ | (1.31 | ) | $ | (1.59 | ) | |||
Non-GAAP diluted income (loss) per share | $ | 0.08 | $ | (0.13 | ) | $ | (0.42 | ) | $ | (0.66 | ) | ||||
Weighted average number of shares | |||||||||||||||
Shares used in computing GAAP diluted net loss per share | 48,231,916 | 49,913,898 | 49,160,266 | 49,791,659 | |||||||||||
Shares used in computing Non-GAAP diluted net income (loss) per share | 50,094,714 | 49,913,898 | 49,160,266 | 49,791,659 | |||||||||||
(1) Share-based compensation | |||||||||||||||
Cost of product revenues | $ | 545 | $ | 543 | $ | 2,356 | $ | 2,185 | |||||||
Cost of service revenues | $ | 447 | 408 | 1,758 | 1,676 | ||||||||||
Research and development | $ | 1,329 | 1,340 | 5,759 | 5,312 | ||||||||||
Sales and marketing | $ | 1,635 | 1,693 | 6,689 | 7,361 | ||||||||||
General and administrative | $ | 1,689 | 1,231 | 6,027 | 6,115 | ||||||||||
$ | 5,645 | $ | 5,215 | $ | 22,589 | $ | 22,649 | ||||||||
(2) Acquisition related expenses | |||||||||||||||
Cost of product revenues | - | - | - | 663 | |||||||||||
General and administrative | $ | - | $ | - | $ | - | $ | 512 | |||||||
$ | - | $ | - | $ | - | $ | 1,175 | ||||||||
(3) Intangible assets amortization | |||||||||||||||
Cost of product revenues | $ | 260 | $ | 266 | $ | 1,053 | $ | 1,402 | |||||||
Cost of service revenues | $ | 160 | 160 | 640 | 640 | ||||||||||
Sales and marketing | $ | 93 | 138 | 550 | 501 | ||||||||||
$ | 513 | $ | 564 | $ | 2,243 | $ | 2,543 | ||||||||
(4) Restructuring expenses | |||||||||||||||
Cost of product revenues | $ | 5,569 | $ | 305 | $ | 5,658 | $ | 689 | |||||||
Cost of service revenues | $ | 5,932 | - | 5,932 | 12 | ||||||||||
Research and development | $ | 860 | 137 | 880 | 201 | ||||||||||
Sales and marketing | $ | 2,744 | 487 | 2,930 | 675 | ||||||||||
General and administrative | $ | 3,975 | 87 | 3,975 | 116 | ||||||||||
$ | 19,080 | $ | 1,016 | $ | 19,375 | $ | 1,693 | ||||||||
(a) Attributed to tax settlement with the | |||||||||||||||
AND ITS SUBSIDIARIES | |||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||
( | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
(Unaudited) | (Unaudited) | Audited | |||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net loss | $ | (22,934 | ) | $ | (35,360 | ) | $ | (64,351 | ) | $ | (79,065 | ) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||||||
Depreciation and amortization | 3,287 | 4,399 | 14,700 | 13,565 | |||||||||||
Restructuring and other charges | 19,080 | - | 19,080 | - | |||||||||||
Fair value of warrants deducted from revenues | 4,841 | 4,339 | 13,842 | 22,500 | |||||||||||
Share-based compensation | 5,645 | 5,215 | 22,589 | 22,649 | |||||||||||
Amortization of premium and accretion of discount on marketable securities, net | 83 | 373 | 756 | 1,820 | |||||||||||
Realized gain on sale and redemption of marketable securities | 93 | - | 134 | 10 | |||||||||||
Change in operating assets and liabilities: | |||||||||||||||
Trade receivables, net | 6,557 | (3,673 | ) | (19,220 | ) | (15,891 | ) | ||||||||
Other accounts receivables and prepaid expenses | (5,040 | ) | (2,501 | ) | (6,492 | ) | (8,635 | ) | |||||||
Inventory | 4,521 | (2,437 | ) | 11,028 | (29,004 | ) | |||||||||
Operating leases right-of-use assets and liabilities, net | 1,544 | 229 | (179 | ) | (2,918 | ) | |||||||||
Deferred taxes | - | 11,523 | - | 8,530 | |||||||||||
Deposits and other long term assets | (103 | ) | (1,859 | ) | (2,282 | ) | (4,251 | ) | |||||||
Trade payables | (2,902 | ) | (9,068 | ) | (6,491 | ) | (26,948 | ) | |||||||
Employees and payroll accruals | (2,294 | ) | (2,222 | ) | (1,089 | ) | (7,674 | ) | |||||||
Deferred revenues and advances from customers | (1,339 | ) | 107 | (4,990 | ) | (1,426 | ) | ||||||||
Other payables and accrued expenses | (8,357 | ) | (8,873 | ) | (10,547 | ) | 7,190 | ||||||||
Accrued severance pay, net | (14 | ) | 43 | (152 | ) | (237 | ) | ||||||||
Other long - term liabilities | (74 | ) | 330 | (1,018 | ) | 13 | |||||||||
Loss (gain) from sale and disposal of property, plant and equipment | - | (142 | ) | - | 425 | ||||||||||
Net cash provided by (used in) operating activities | $ | 2,594 | $ | (39,577 | ) | $ | (34,682 | ) | $ | (99,347 | ) | ||||
Cash flows from investing activities: | |||||||||||||||
Purchase of property, plant and equipment | $ | (934 | ) | $ | (5,776 | ) | $ | (7,006 | ) | $ | (18,042 | ) | |||
Investment in equity securities | - | (193 | ) | - | (820 | ) | |||||||||
Acquisition of intangible assets | - | (73 | ) | - | (308 | ) | |||||||||
Proceeds from sale of property, plant and equipment | - | - | - | 71 | |||||||||||
Cash paid in connection with acquisition, net of cash acquired | - | - | - | (14,654 | ) | ||||||||||
Proceeds from (investment in) short-term bank deposits, net | (15,505 | ) | 85,089 | 39,433 | (265,865 | ) | |||||||||
Proceeds from sales and redemption of marketable securities | - | - | 7,240 | 1,945 | |||||||||||
Proceeds from maturities of marketable securities | 6,300 | 6,500 | 20,522 | 27,898 | |||||||||||
Investment in marketable securities | (9,526 | ) | (8,135 | ) | (33,977 | ) | (137,500 | ) | |||||||
Net cash provided by (used in) investing activities | $ | (19,665 | ) | $ | 77,412 | $ | 26,212 | $ | (407,275 | ) | |||||
Cash flows from financing activities: | |||||||||||||||
Exercise of employee stock options | $ | - | $ | 159 | $ | 293 | $ | 619 | |||||||
Payments related to shares withheld for taxes | (608 | ) | (90 | ) | (1,045 | ) | (951 | ) | |||||||
Repurchase of ordinary shares | (19,004 | ) | - | (55,770 | ) | - | |||||||||
Net cash used in financing activities | $ | (19,612 | ) | $ | 69 | $ | (56,522 | ) | $ | (332 | ) | ||||
Increase (decrease) in cash and cash equivalents | $ | (36,683 | ) | $ | 37,904 | $ | (64,992 | ) | $ | (506,954 | ) | ||||
Cash and cash equivalents at the beginning of the period | 76,288 | 66,693 | 104,597 | 611,551 | |||||||||||
Cash and cash equivalents at the end of the period | $ | 39,605 | $ | 104,597 | $ | 39,605 | $ | 104,597 | |||||||
Non-cash investing and financing activities: | |||||||||||||||
Purchase of property and equipment on credit | 314 | 1,692 | 314 | 1,692 | |||||||||||
Inventory transferred to be used as property and equipment | - | 5,248 | 531 | 6,792 | |||||||||||
Property, plant and equipment transferred to be used as inventory | 131 | - | 865 | - | |||||||||||
Lease liabilities arising from obtaining right-of-use assets | (3,250 | ) | 408 | 2,559 | 7,585 | ||||||||||
AND ITS SUBSIDIARIES | |||||||||||||||||
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA | |||||||||||||||||
( | |||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||
GAAP Revenues | $ | 56,585 | $ | 63,298 | $ | 219,786 | $ | 271,518 | |||||||||
GAAP Net Loss | (22,934 | ) | (35,360 | ) | (64,351 | ) | (79,065 | ) | |||||||||
Taxes on income | 539 | 23,703 | 970 | 22,565 | |||||||||||||
Financial income | (5,424 | ) | (5,052 | ) | (24,150 | ) | (13,382 | ) | |||||||||
Share-based compensation | 5,645 | 5,215 | 22,589 | 22,649 | |||||||||||||
Intangible assets amortization | 513 | 564 | 2,243 | 2,543 | |||||||||||||
Acquisition related expenses | - | - | - | 512 | |||||||||||||
Excess cost of product on acquired inventory | - | - | - | 663 | |||||||||||||
Restructuring expenses | 19,080 | 1,016 | 19,375 | 1,693 | |||||||||||||
Non-GAAP Operating Loss | (2,581 | ) | (9,914 | ) | (43,324 | ) | (41,822 | ) | |||||||||
Depreciation | 2,774 | 3,835 | 12,457 | 11,022 | |||||||||||||
Adjusted EBITDA | $ | 193 | $ | (6,079 | ) | $ | (30,867 | ) | $ | (30,800 | ) |
Source:
2024 GlobeNewswire, Inc., source