SAN JOSE, Calif., Aug. 8, 2019 /PRNewswire/ -- Intermolecular,
Inc. (Nasdaq: IMI), the trusted partner for advanced
materials innovation, today reported results for its second quarter
ended June 30, 2019.
Second Quarter of 2019 Financial Results
Revenue for the second quarter of 2019 was $4.6 million, a decrease of 31% from $6.7 million in the first quarter of 2019, and a
decrease of 53% from $9.8 million in
the same period a year ago. Program revenue was $4.5 million, a 30% decrease from $6.4 million in the first quarter of 2019, and a
52% decrease from $9.4 million in the
same period a year ago.
Gross profit for the second quarter of 2019 was $3.2 million (69% of total revenue), a 34%
decrease from $4.8 million (73% of
total revenue) in the first quarter of 2019, and a 54% decrease
from $6.9 million (71% of total
revenue) in the same period a year ago.
Total operating expenses for the second quarter of 2019 were
$8.7 million, an 18% increase from
$7.4 million in the first quarter of
2019, and an increase of 30% compared to $6.7 million in the same period a year ago.
Net loss for the second quarter of 2019 totaled $(5.3) million, or $(0.11) per basic and diluted share, compared to
net loss of $(2.3) million, or
$(0.05) per basic and diluted share
in the first quarter of 2019, and compared to net income of
$0.5 million, or $0.01 per basic and diluted share in the same
period a year ago.
Non-GAAP net loss, which excludes stock-based compensation
expense, for the second quarter of 2019 totaled $(4.9) million, or $(0.10) per basic and diluted share, compared to
non-GAAP net loss of $(1.8) million,
or $(0.04) per basic and diluted
share in the first quarter of 2019, and compared to non-GAAP net
income of $0.7 million, or
$0.01 per basic and diluted share in
the same period a year ago.
Adjusted EBITDA for the second quarter of 2019 totaled
$(4.6) million, compared to an
adjusted EBITDA of $(1.3) million in
the first quarter of 2019 and Adjusted EBITDA of $1.8 million in the same period a year
ago.
Cash and investments totaled $23.9
million at the end of second quarter of 2019, a decrease of
$3.5 million compared to $27.4 million at the end of first quarter of
2019. The company had no debt as of June
30, 2019.
Intermolecular reports revenue, cost of revenue, gross margin,
operating income (loss), net income (loss) and earnings (loss) per
share in accordance with U.S. generally accepted accounting
principles (GAAP) and additionally on a non-GAAP basis. A
reconciliation of the non-GAAP financial measures with the most
directly comparable GAAP measures, as well as a description of the
items excluded from the non-GAAP measures, is included in the
financial statements portion of this press release. Please refer to
"Reconciliation of GAAP to Non-GAAP Financial Measures" and
"Reconciliation of GAAP Net Loss to Non-GAAP Net Loss" below.
Agreement and Plan of Merger
Intermolecular will not hold an earnings call, nor provide forward
guidance for the third quarter of fiscal year 2019, due to the
previously announced proposed acquisition of Intermolecular by
Merck KGaA, Darmstadt, Germany.
About Intermolecular, Inc.
Intermolecular® is the trusted partner for advanced
materials innovation. Advanced materials are at the core
of innovation in the 21st century for a wide range of
industries including semiconductors, consumer electronics,
automotive and aerospace. With its substantial materials expertise,
accelerated learning and experimentation platform, and information
and analytics infrastructure, Intermolecular has a ten-year track
record helping leading companies accelerate and de-risk materials
innovation. Learn more at www.intermolecular.com.
"Intermolecular" and the Intermolecular logo are registered
trademarks; all rights reserved.
Non-GAAP Financial Measures
To supplement the financial data presented on a GAAP basis, we also
disclose certain non-GAAP financial measures, which exclude the
effect of stock-based compensation expense. These non-GAAP
financial measures are not prepared in accordance with GAAP, do not
serve as an alternative to GAAP and may be calculated differently
than non-GAAP financial information disclosed by other companies.
These results should only be used to evaluate our results of
operations in conjunction with the corresponding GAAP measures. We
believe that our non-GAAP financial information provides useful
information to management and investors regarding financial and
business trends relating to our financial condition and results of
operations because the non-GAAP measures exclude charges that
management considers to be outside of Intermolecular's core
operating results. We believe that the non-GAAP measures of
revenue, cost of net revenue, gross profit, gross margin, operating
(loss) income, net (loss) income, Adjusted EBITDA, earnings per
share and net (loss) income per share, viewed in combination with
our financial results calculated in accordance with GAAP, provide
investors with additional perspective and a more meaningful
understanding of our ongoing operating performance. In addition,
management uses these non-GAAP measures to review and assess
financial performance, to determine executive officer incentive
compensation and to plan and forecast performance in future
periods.
Investor Contact
Bill Roeschlein
Intermolecular, Inc.
Chief Financial Officer
bill.roeschlein@intermolecular.com
(408) 582-5415
|
Intermolecular, Inc.
|
|
Condensed
Consolidated Statements of Operations
|
|
(In thousands,
except share and per share amounts, Unaudited)
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Program
revenue
|
|
$
|
4,485
|
|
|
$
|
9,365
|
|
|
$
|
10,870
|
|
|
$
|
18,621
|
|
Licensing and royalty
revenue
|
|
|
133
|
|
|
|
437
|
|
|
|
399
|
|
|
|
856
|
|
Total
revenue
|
|
|
4,618
|
|
|
|
9,802
|
|
|
|
11,269
|
|
|
|
19,477
|
|
Cost of
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of program
revenue
|
|
|
1,437
|
|
|
|
2,856
|
|
|
|
3,255
|
|
|
|
6,231
|
|
Cost of licensing and
royalty revenue
|
|
|
—
|
|
|
|
3
|
|
|
|
—
|
|
|
|
4
|
|
Total cost of
revenue
|
|
|
1,437
|
|
|
|
2,859
|
|
|
|
3,255
|
|
|
|
6,235
|
|
Gross
profit
|
|
|
3,181
|
|
|
|
6,943
|
|
|
|
8,014
|
|
|
|
13,242
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
|
4,216
|
|
|
|
4,056
|
|
|
|
8,362
|
|
|
|
8,087
|
|
Sales and
marketing
|
|
|
974
|
|
|
|
858
|
|
|
|
1,864
|
|
|
|
1,654
|
|
General and
administrative
|
|
|
3,494
|
|
|
|
1,748
|
|
|
|
5,832
|
|
|
|
4,034
|
|
Total operating
expenses
|
|
|
8,684
|
|
|
|
6,662
|
|
|
|
16,058
|
|
|
|
13,775
|
|
Income (loss) from
operations
|
|
|
(5,503)
|
|
|
|
281
|
|
|
|
(8,044)
|
|
|
|
(533)
|
|
Other income
(expenses), net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
(expense), net
|
|
|
172
|
|
|
|
140
|
|
|
|
355
|
|
|
|
245
|
|
Other income
(expense), net
|
|
|
(3)
|
|
|
|
75
|
|
|
|
93
|
|
|
|
162
|
|
Total other income
(expense), net
|
|
|
169
|
|
|
|
215
|
|
|
|
448
|
|
|
|
407
|
|
Income (loss) before
provision for income taxes
|
|
|
(5,334)
|
|
|
|
496
|
|
|
|
(7,596)
|
|
|
|
(126)
|
|
Provision for income
taxes
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
|
Net income
(loss)
|
|
$
|
(5,334)
|
|
|
$
|
496
|
|
|
$
|
(7,596)
|
|
|
$
|
(127)
|
|
Earnings (loss) per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.11)
|
|
|
$
|
0.01
|
|
|
$
|
(0.15)
|
|
|
$
|
(0.00)
|
|
Diluted
|
|
$
|
(0.11)
|
|
|
$
|
0.01
|
|
|
$
|
(0.15)
|
|
|
$
|
(0.00)
|
|
Weighted-average
number of shares used in computing earnings (loss) per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
49,758,224
|
|
|
|
49,672,739
|
|
|
|
49,757,917
|
|
|
|
49,627,584
|
|
Diluted
|
|
|
49,758,224
|
|
|
|
50,059,639
|
|
|
|
49,757,917
|
|
|
|
49,627,584
|
|
Intermolecular, Inc.
|
|
Condensed
Consolidated Balance Sheets
|
|
(In thousands,
Unaudited)
|
|
|
|
As of
June 30, 2019
|
|
|
As of
December 31, 2018
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
2,160
|
|
|
$
|
8,351
|
|
Short-term
investments
|
|
|
21,753
|
|
|
|
22,098
|
|
Total cash, cash
equivalents and short-term investments
|
|
|
23,913
|
|
|
|
30,449
|
|
Accounts
receivable
|
|
|
1,941
|
|
|
|
3,349
|
|
Prepaid expenses and
other current assets
|
|
|
1,004
|
|
|
|
936
|
|
Total current
assets
|
|
|
26,858
|
|
|
|
34,734
|
|
Materials
inventory
|
|
|
2,375
|
|
|
|
2,638
|
|
Property and
equipment, net
|
|
|
2,809
|
|
|
|
3,432
|
|
Intangible assets,
net
|
|
|
1,892
|
|
|
|
2,075
|
|
Right-of-use lease
assets - operating
|
|
|
10,841
|
|
|
|
—
|
|
Other
assets
|
|
|
503
|
|
|
|
514
|
|
Total
assets
|
|
$
|
45,278
|
|
|
$
|
43,393
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
112
|
|
|
$
|
760
|
|
Accrued
liabilities
|
|
|
1,592
|
|
|
|
1,234
|
|
Accrued compensation
and employee benefits
|
|
|
1,984
|
|
|
|
3,431
|
|
Current portion of
lease obligation - operating
|
|
|
1,816
|
|
|
|
—
|
|
Deferred
revenue
|
|
|
159
|
|
|
|
917
|
|
Total current
liabilities
|
|
|
5,663
|
|
|
|
6,342
|
|
Deferred
rent
|
|
|
—
|
|
|
|
2,667
|
|
Long term lease
obligation - operating
|
|
|
11,832
|
|
|
|
—
|
|
Total
liabilities
|
|
|
17,495
|
|
|
|
9,009
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
|
Common
stock
|
|
|
50
|
|
|
|
50
|
|
Additional paid-in
capital
|
|
|
216,974
|
|
|
|
216,034
|
|
Accumulated other
comprehensive income (loss)
|
|
|
28
|
|
|
|
(27)
|
|
Accumulated
deficit
|
|
|
(189,269)
|
|
|
|
(181,673)
|
|
Total stockholders'
equity
|
|
|
27,783
|
|
|
|
34,384
|
|
Total liabilities and
stockholders' equity
|
|
$
|
45,278
|
|
|
$
|
43,393
|
|
Intermolecular, Inc.
|
|
Condensed
Consolidated Statements of Cash Flows
|
|
(In thousands,
Unaudited)
|
|
|
|
Six Months Ended
June 30,
|
|
|
2019
|
|
|
2018
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(7,596)
|
|
|
$
|
(127)
|
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation,
amortization and accretion
|
|
|
1,123
|
|
|
|
2,693
|
|
Amortization expense -
Right of use lease assets operating
|
|
|
787
|
|
|
|
—
|
|
Stock-based
compensation
|
|
|
935
|
|
|
|
482
|
|
Loss on disposal of
property and equipment
|
|
|
2
|
|
|
|
—
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
1,408
|
|
|
|
4,074
|
|
Prepaid expenses and
other assets
|
|
|
(57)
|
|
|
|
393
|
|
Materials
inventory
|
|
|
291
|
|
|
|
(134)
|
|
Accounts
payable
|
|
|
(520)
|
|
|
|
(750)
|
|
Accrued and other
liabilities
|
|
|
(1,634)
|
|
|
|
(67)
|
|
Deferred
revenue
|
|
|
(759)
|
|
|
|
(633)
|
|
Net cash (used in)
provided by operating activities
|
|
|
(6,020)
|
|
|
|
5,931
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Purchase of
investments
|
|
|
(13,804)
|
|
|
|
(19,367)
|
|
Redemption of
investments
|
|
|
14,202
|
|
|
|
12,010
|
|
Purchase of property
and equipment
|
|
|
(574)
|
|
|
|
(489)
|
|
Net cash used in
investing activities
|
|
|
(176)
|
|
|
|
(7,846)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from exercise
of common stock options
|
|
|
5
|
|
|
|
172
|
|
Net cash provided by
financing activities
|
|
|
5
|
|
|
|
172
|
|
Net decrease in cash
and cash equivalents
|
|
|
(6,191)
|
|
|
|
(1,743)
|
|
Cash and cash
equivalents at beginning of period
|
|
|
8,351
|
|
|
|
6,090
|
|
Cash and cash
equivalents at end of period
|
|
$
|
2,160
|
|
|
$
|
4,347
|
|
Intermolecular, Inc.
|
|
Reconciliation of
GAAP to Non-GAAP Financial Measures
|
|
(In thousands,
except per share amounts and percentages, Unaudited)
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
GAAP cost of net
revenue
|
|
$
|
1,437
|
|
|
$
|
2,859
|
|
|
$
|
3,255
|
|
|
$
|
6,235
|
|
|
Stock-based
compensation expense (a)
|
|
|
(36)
|
|
|
|
(39)
|
|
|
|
(81)
|
|
|
|
(92)
|
|
|
Non-GAAP cost of net
revenue
|
|
$
|
1,401
|
|
|
$
|
2,820
|
|
|
$
|
3,174
|
|
|
$
|
6,143
|
|
|
GAAP gross
profit
|
|
$
|
3,181
|
|
|
$
|
6,943
|
|
|
$
|
8,014
|
|
|
$
|
13,242
|
|
|
Stock-based
compensation expense (a)
|
|
|
36
|
|
|
|
39
|
|
|
|
81
|
|
|
|
92
|
|
|
Non-GAAP gross
profit
|
|
$
|
3,217
|
|
|
$
|
6,982
|
|
|
$
|
8,095
|
|
|
$
|
13,334
|
|
|
As a percentage of
net revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
margin
|
|
|
68.9
|
%
|
|
|
70.8
|
%
|
|
|
71.1
|
%
|
|
|
68.0
|
%
|
|
Non-GAAP gross
margin
|
|
|
69.7
|
%
|
|
|
71.2
|
%
|
|
|
71.8
|
%
|
|
|
68.5
|
%
|
|
GAAP operating income
(loss)
|
|
$
|
(5,503)
|
|
|
$
|
281
|
|
|
$
|
(8,044)
|
|
|
$
|
(533)
|
|
|
Stock-based
compensation expense (a):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Cost of net
revenue
|
|
|
36
|
|
|
|
39
|
|
|
|
81
|
|
|
|
92
|
|
|
- Research and
development
|
|
|
120
|
|
|
|
59
|
|
|
|
233
|
|
|
|
114
|
|
|
- Sales and
marketing
|
|
|
57
|
|
|
|
21
|
|
|
|
110
|
|
|
|
51
|
|
|
- General and
administrative
|
|
|
259
|
|
|
|
93
|
|
|
|
511
|
|
|
|
225
|
|
|
Non-GAAP operating
income (loss)
|
|
$
|
(5,031)
|
|
|
$
|
493
|
|
|
$
|
(7,109)
|
|
|
$
|
(51)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
|
$
|
(5,334)
|
|
|
$
|
496
|
|
|
$
|
(7,596)
|
|
|
$
|
(127)
|
|
|
Stock-based
compensation expense (a)
|
|
|
472
|
|
|
|
212
|
|
|
|
935
|
|
|
|
482
|
|
|
Non-GAAP net income
(loss)
|
|
$
|
(4,862)
|
|
|
$
|
708
|
|
|
$
|
(6,661)
|
|
|
$
|
355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
|
$
|
(5,334)
|
|
|
$
|
496
|
|
|
$
|
(7,596)
|
|
|
$
|
(127)
|
|
|
Interest (income)
expense, net
|
|
|
(172)
|
|
|
|
(140)
|
|
|
|
(355)
|
|
|
|
(245)
|
|
|
Provision for
taxes
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
Depreciation,
amortization, impairments and accretion
|
|
|
458
|
|
|
|
1,270
|
|
|
|
1,123
|
|
|
|
2,693
|
|
|
Stock-based
compensation expense (a)
|
|
|
472
|
|
|
|
212
|
|
|
|
935
|
|
|
|
482
|
|
|
Adjusted
EBITDA
|
|
$
|
(4,576)
|
|
|
$
|
1,838
|
|
|
$
|
(5,893)
|
|
|
$
|
2,804
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in
computing basic and diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
49,758,224
|
|
|
|
49,672,739
|
|
|
|
49,757,917
|
|
|
|
49,627,584
|
|
|
Diluted
|
|
|
49,758,224
|
|
|
|
50,059,639
|
|
|
|
49,757,917
|
|
|
|
49,627,584
|
|
|
GAAP earnings (loss)
per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.11)
|
|
|
$
|
0.01
|
|
|
$
|
(0.15)
|
|
|
$
|
(0.00)
|
|
|
Diluted
|
|
$
|
(0.11)
|
|
|
$
|
0.01
|
|
|
$
|
(0.15)
|
|
|
$
|
(0.00)
|
|
|
Non-GAAP earnings
(loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.10)
|
|
|
$
|
0.01
|
|
|
$
|
(0.13)
|
|
|
$
|
0.01
|
|
|
Diluted
|
|
$
|
(0.10)
|
|
|
$
|
0.01
|
|
|
$
|
(0.13)
|
|
|
$
|
0.01
|
|
|
|
|
(a)
|
Stock-based
compensation reflects expense recorded relating to stock-based
awards. The Company excludes this item when it evaluates the
continuing operational performance of the Company, as management
believes this provides it a meaningful understanding of its core
operating performance.
|
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SOURCE Intermolecular, Inc.