Impinj Reports Second Quarter 2022 Financial Results

Jul 27, 2022

SEATTLE--(BUSINESS WIRE)-- Impinj, Inc. (NASDAQ: PI), a leading RAIN RFID provider and Internet of Things pioneer, today released its financial results for the second quarter ended June 30, 2022.

“Our second-quarter results were strong, with revenue and profitability exceeding our guidance,” said Chris Diorio, Impinj co-founder and CEO. “I expect demand to remain strong through second-half 2022, as we continue investing in our team, operations and platform.”

Second Quarter 2022 Financial Summary

  • Revenue of $59.8 million
  • GAAP gross margin of 52.7%; non-GAAP gross margin of 54.7%
  • GAAP net loss of $11.5 million, or loss of $(0.45) per diluted share using 25.4 million shares
  • Adjusted EBITDA of $3.8 million
  • Non-GAAP net income of $3.0 Million, or income of $0.11 per diluted share using 26.6 million shares

A reconciliation between GAAP and non-GAAP information is contained in the tables below. Additionally, descriptions of these non-GAAP financial measures are provided in the “Non-GAAP Financial Measures” sections below.

Third Quarter 2022 Financial Outlook

Impinj provides guidance based on current market conditions and expectations; actual results may differ materially. Please refer to the comments below regarding forward-looking statements. The following table presents Impinj’s financial outlook for the third quarter 2022 (in millions, except per share data):

 

 

Three Months Ending

 

 

September 30, 2022

Revenue

 

$63.5 to $65.5

GAAP Net loss

 

($7.5) to ($6.0)

Adjusted EBITDA income

 

$5.1 to $6.6

GAAP Weighted-average shares — basic and diluted

 

25.70 to 25.90

GAAP Net loss per share — basic and diluted

 

($0.29 ) to ($0.23)

Non-GAAP Net income

 

$4.0 to $5.5

Non-GAAP Weighted-average shares — basic

 

25.70 to 25.90

Non-GAAP Weighted-average shares — diluted

 

26.70 to 26.90

Non-GAAP Net income per share — basic

 

$0.16 to $0.21

Non-GAAP Net income per share — diluted

 

$0.15 to $0.20

A reconciliation between GAAP and non-GAAP is provided in the "Non-GAAP Financial Measures" section below.

Conference Call Information

Impinj will host a conference call today, July 27, 2022 at 5:00 p.m. ET / 2:00 p.m. PT to discuss its second quarter 2022 results, as well as its outlook for its third quarter 2022. Interested parties may access the call by dialing +1-412-317-5196. A live webcast and replay will also be available on the company’s website at investor.impinj.com. Following the call, a telephonic replay will be available for five business days and may be accessed by dialing +1-412-317-0088 and entering passcode 9824045.

Management’s prepared written remarks, along with quarterly financial data, will be made available on our website at investor.impinj.com along with this release.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding the market for RAIN RFID, our strategy, our prospects, the impact of Covid-19, the impact of silicon wafer and reader component availability and supply, and financial considerations for third quarter of 2022 and future periods.

Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of future performance.

The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption "Risk Factors" and elsewhere in our annual report on Form 10-K and quarterly reports on Form 10-Q filed with the U.S. Securities and Exchange Commission. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update this information unless required by law.

About Impinj

Impinj (NASDAQ: PI) helps businesses and people analyze, optimize, and innovate by wirelessly connecting billions of everyday things — such as apparel, automobile parts, luggage, and shipments — to the Internet. The Impinj platform uses RAIN RFID to deliver timely data about these everyday things to business and consumer applications, enabling a boundless Internet of Things. www.impinj.com

Impinj is a registered trademark of Impinj, Inc. All other trademarks are the property of their owners.

IMPINJ, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except par value, unaudited)

 

 

June 30, 2022 (1)

 

December 31, 2021 (1)

Assets:

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

32,580

 

$

123,903

Short-term investments

 

130,719

 

 

69,443

Accounts receivable, net

 

40,128

 

 

35,449

Inventory

 

32,047

 

 

21,958

Prepaid expenses and other current assets

 

3,603

 

 

5,049

Total current assets

 

239,077

 

 

255,802

Long-term investments

 

20,440

 

 

14,225

Property and equipment, net

 

28,726

 

 

27,500

Operating lease right-of-use assets

 

10,044

 

 

11,667

Other non-current assets

 

2,240

 

 

2,462

Goodwill

 

3,881

 

 

3,881

Total assets

$

304,408

 

$

315,537

Liabilities and stockholders' equity:

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

10,099

 

$

11,732

Accrued compensation and employee related benefits

 

5,928

 

 

6,365

Accrued and other current liabilities

 

2,920

 

 

2,481

Current portion of operating lease liabilities

 

3,635

 

 

4,143

Restructuring liabilities

 

119

 

 

591

Current portion of long-term debt

 

 

 

9,633

Current portion of deferred revenue

 

2,632

 

 

558

Total current liabilities

 

25,333

 

 

35,503

Long-term debt, net of current portion

 

279,449

 

 

278,661

Operating lease liabilities, net of current portion

 

10,408

 

 

11,934

Other long-term liabilities

 

113

 

 

279

Deferred revenue, net of current portion

 

364

 

 

236

Total liabilities

 

315,667

 

 

326,613

Stockholders' equity:

 

 

 

Common stock, $0.001 par value

 

26

 

 

25

Additional paid-in capital

 

374,409

 

 

351,422

Accumulated other comprehensive (loss) income

 

(1,226)

 

 

(39)

Accumulated deficit

 

(384,468)

 

 

(362,484)

Total stockholders' equity

 

(11,259)

 

 

(11,076)

Total liabilities and stockholders' equity

$

304,408

 

$

315,537

(1) We adopted ASU 2020-06 on January 1, 2021 using modified retrospective transition method and accounted for our convertible notes due 2026, or the 2019 Notes, on a whole-instrument basis. Upon adoption, we no longer had unamortized debt discount related to the equity component of the 2019 Notes. The condensed consolidated financial statements under both periods are presented under ASU 2020-06.

IMPINJ, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data, unaudited)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2022

 

2021

 

2022

 

2021

Revenue

 

$

59,796

 

 

$

47,268

 

 

$

112,940

 

 

$

92,516

 

Cost of revenue

 

 

28,294

 

 

 

22,491

 

 

 

52,659

 

 

 

45,758

 

Gross profit

 

 

31,502

 

 

 

24,777

 

 

 

60,281

 

 

 

46,758

 

Operating expenses:

 

 

 

 

 

 

 

 

Research and development

 

 

18,369

 

 

 

15,900

 

 

 

36,358

 

 

 

29,691

 

Sales and marketing

 

 

9,614

 

 

 

8,196

 

 

 

18,913

 

 

 

15,841

 

General and administrative

 

 

11,995

 

 

 

8,998

 

 

 

22,801

 

 

 

17,152

 

Restructuring costs

 

 

 

 

 

 

 

 

-

 

 

 

1,263

 

Total operating expenses

 

 

39,978

 

 

 

33,094

 

 

 

78,072

 

 

 

63,947

 

Loss from operations

 

 

(8,476

)

 

 

(8,317

)

 

 

(17,791

)

 

 

(17,189

)

Other income (expense), net

 

 

429

 

 

 

(4

)

 

 

593

 

 

 

19

 

Induced conversion expense

 

 

(2,232

)

 

 

 

 

 

(2,232

)

 

 

 

Interest expense

 

 

(1,250

)

 

 

(525

)

 

 

(2,511

)

 

 

(1,050

)

Loss before income taxes

 

 

(11,529

)

 

 

(8,846

)

 

 

(21,941

)

 

 

(18,220

)

Income tax expense

 

 

6

 

 

 

(60

)

 

 

(43

)

 

 

(102

)

Net loss

 

$

(11,523

)

 

$

(8,906

)

 

$

(21,984

)

 

$

(18,322

)

Net loss per share — basic and diluted

 

$

(0.45

)

 

$

(0.37

)

 

$

(0.87

)

 

$

(0.77

)

Weighted-average shares — basic and diluted

 

 

25,429

 

 

 

24,120

 

 

 

25,204

 

 

 

23,895

 

IMPINJ, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands, unaudited)

 

 

 

Six Months Ended

 

 

June 30,

 

 

2022

 

2021

Operating activities:

 

 

 

 

Net loss

 

$

(21,984)

 

$

(18,322)

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

 

Depreciation

 

 

2,973

 

 

2,076

Stock-based compensation

 

 

22,173

 

 

18,031

Accretion of discount or amortization of premium on investments

 

 

419

 

 

468

Amortization of debt issuance costs

 

 

806

 

 

188

Induced conversion expense related to convertible notes

 

 

2,232

 

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

 

(4,679)

 

 

(973)

Inventory

 

 

(10,089)

 

 

12,265

Prepaid expenses and other assets

 

 

1,463

 

 

(186)

Accounts payable

 

 

(2,201)

 

 

(3,053)

Accrued compensation and employee related benefits

 

 

(437)

 

 

422

Accrued and other liabilities

 

 

366

 

 

364

Operating lease right-of-use assets

 

 

1,623

 

 

1,458

Operating lease liabilities

 

 

(2,034)

 

 

(1,834)

Restructuring liabilities

 

 

(472)

 

 

630

Deferred revenue

 

 

2,202

 

 

(6,553)

Net cash provided by (used in) operating activities

 

 

(7,639)

 

 

4,981

Investing activities:

 

 

 

 

Purchases of investments

 

 

(115,697)

 

 

(19,825)

Proceeds from maturities of investments

 

 

46,805

 

 

41,000

Purchases of property and equipment

 

 

(3,724)

 

 

(7,858)

Net cash provided by (used in) investing activities

 

 

(72,616)

 

 

13,317

Financing activities:

 

 

 

 

Principal payments on finance lease obligations

 

 

 

 

(2)

Proceeds from exercise of stock options and employee stock purchase plan

 

 

6,496

 

 

9,243

Payment of 2019 Notes

 

 

(17,564)

 

 

Net cash provided by (used in) financing activities

 

 

(11,068)

 

 

9,241

Net increase (decrease) in cash and cash equivalents

 

 

(91,323)

 

 

27,539

Cash and cash equivalents

 

 

 

 

Beginning of period

 

 

123,903

 

 

23,636

End of period

 

$

32,580

 

$

51,175

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements prepared and presented in accordance with U.S. generally accepted accounting principles, or GAAP, our key non-GAAP performance measures include adjusted EBITDA and non-GAAP net income (loss), as defined below. We use adjusted EBITDA and non-GAAP net income (loss) as key measures to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operating plans. We believe these measures provide useful information for period-to-period comparisons of our business to allow investors and others to understand and evaluate our operating results in the same manner as our management and board of directors. Our presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP, and our non-GAAP measures may be different from similarly termed non-GAAP measures used by other companies.

Adjusted EBITDA

We define adjusted EBITDA as net income (loss) determined in accordance with GAAP, excluding, if applicable for the periods presented, the effects of stock-based compensation; depreciation; investigation costs; restructuring costs; settlement and related costs; other income, net; interest expense; loss on debt extinguishment; induced conversion expense associated with repurchases of our 2019 Notes; and income tax benefit (expense).

Non-GAAP Net Income (Loss)

We define non-GAAP net income (loss) as net income (loss), excluding, if applicable for the periods presented, the effects of stock-based compensation; depreciation; investigation costs; restructuring costs; settlement and related costs; amortization of debt discount related to the equity component of our convertible notes prior to the adoption of ASU 2020-06; induced conversion expense associated with repurchases of our 2019 Notes; and prepayment penalty on debt extinguishment.

On January 1, 2021, we adopted ASU 2020-06 using the modified retrospective transition method, accounting for the 2019 Notes on a whole-instrument basis. Upon adoption, the condensed consolidated financial statements for the three and six months ended June 30, 2022 and June 30, 2021, are presented under the new standard and we no longer recorded amortization of debt discount. In fourth-quarter 2021, we revised our definition of adjusted EBITDA to exclude the expense incurred in connection with the induced conversion expense associated with repurchases of our 2019 Notes.

IMPINJ, INC.

RECONCILIATIONS OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES

(in thousands, except percentages, unaudited)

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2022

 

2021

 

2022

 

2021

GAAP Gross margin

 

 

52.7%

 

 

52.4%

 

 

53.4%

 

 

50.5%

Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

1.5%

 

 

1.1%

 

 

1.6%

 

 

1.1%

Stock-based compensation

 

 

0.5%

 

 

1.0%

 

 

0.8%

 

 

0.8%

Non-GAAP Gross margin

 

 

54.7%

 

 

54.5%

 

 

55.8%

 

 

52.4%

 

 

 

 

 

 

 

 

 

GAAP Net loss

 

$

(11,523)

 

$

(8,906)

 

$

(21,984)

 

$

(18,322)

Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

1,465

 

 

1,036

 

 

2,973

 

 

2,076

Stock-based compensation

 

 

10,859

 

 

10,582

 

 

22,173

 

 

18,031

Other income, net

 

 

(429)

 

 

4

 

 

(593)

 

 

(19)

Interest expense

 

 

1,250

 

 

525

 

 

2,511

 

 

1,050

Income tax expense

 

 

(6)

 

 

60

 

 

43

 

 

102

Restructuring costs

 

 

 

 

 

 

 

 

1,263

Induced conversion expense

 

 

2,232

 

 

 

 

2,232

 

 

Adjusted EBITDA

 

$

3,848

 

$

3,301

 

$

7,355

 

$

4,181

 

 

 

 

 

 

 

 

 

GAAP Net loss

 

$

(11,523)

 

$

(8,906)

 

$

(21,984)

 

$

(18,322)

Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

1,465

 

 

1,036

 

 

2,973

 

 

2,076

Stock-based compensation

 

 

10,859

 

 

10,582

 

 

22,173

 

 

18,031

Restructuring costs

 

 

 

 

 

 

 

 

1,263

Induced conversion expense

 

 

2,232

 

 

 

 

2,232

 

 

Non-GAAP Net income

 

$

3,033

 

$

2,712

 

$

5,394

 

$

3,048

 

 

 

 

 

 

 

 

 

Non-GAAP Net income per share:

 

 

 

 

 

 

 

 

Basic

 

$

0.12

 

$

0.11

 

$

0.21

 

$

0.13

Diluted

 

$

0.11

 

$

0.11

 

$

0.20

 

$

0.12

GAAP and non-GAAP Weighted-average shares — basic

 

 

25,429

 

 

24,120

 

 

25,204

 

 

23,895

 

 

 

 

 

 

 

 

 

GAAP Weighted-average shares — diluted

 

 

25,429

 

 

24,120

 

 

25,204

 

 

23,895

Dilutive shares from stock plans

 

 

1,167

 

 

1,469

 

 

1,584

 

 

1,726

Non-GAAP Weighted-average shares — diluted

 

 

26,596

 

 

25,589

 

 

26,788

 

 

25,621

IMPINJ, INC.

RECONCILIATIONS OF GAAP FINANCIAL OUTLOOK TO NON-GAAP FINANCIAL OUTLOOK

(in thousands, except per share data, unaudited – calculated at the midpoint of the outlook range)

 

 

 

Three Months Ending

 

 

September 30,

 

 

2022

GAAP Net loss

 

$

(6,750)

Adjustments:

 

 

Forecasted Depreciation

 

 

1,580

Forecasted Stock-based compensation

 

 

9,830

Forecasted Interest expense

 

 

1,260

Forecasted Other income, net

 

 

(150)

Forecasted Income tax expense

 

 

30

Adjusted EBITDA

 

$

5,800

 

 

 

GAAP Net loss

 

$

(6,750)

Adjustments:

 

 

Forecasted Depreciation

 

 

1,580

Forecasted Stock-based compensation

 

 

9,830

Non-GAAP Net income

 

$

4,660

 

 

 

GAAP Net loss per share — basic and diluted

 

$

(0.26)

Non-GAAP Net income per share

 

 

Basic

 

$

0.18

Diluted

 

$

0.17

 

 

 

GAAP weighted-average shares — basic and diluted

 

 

25,800

 

 

 

Non-GAAP weighted-average shares — basic

 

 

25,800

Dilutive shares from stock plans

 

 

1,000

Non-GAAP weighted-average shares — diluted

 

 

26,800

 

Investor Relations
Andy Cobb, CFA
Vice President, Strategic Finance
+1-206-315-4470
ir@impinj.com

Media Relations
Jill West
Vice President, Strategic Communications
+1 206-834-1110
jwest@impinj.com

Source: Impinj, Inc.