Impinj Reports Fourth Quarter and Full Year 2022 Financial Results

Feb 8, 2023

SEATTLE--(BUSINESS WIRE)-- Impinj, Inc. (NASDAQ: PI), a leading provider and pioneer of RAIN RFID solutions, today released its financial results for the fourth quarter and year ended December 31, 2022.

“2022 was a very strong year for Impinj,” said Chris Diorio, Impinj co-founder and CEO. “We delivered record revenue and adjusted EBITDA, invested in our team, unlocked new opportunities heading into 2023 and advanced our vision of connecting every thing.”

Fourth Quarter 2022 Financial Summary

  • Revenue of $76.6 million
  • GAAP gross margin of 52.4%; non-GAAP gross margin of 53.8%
  • GAAP net loss of $0.1 million, or loss of less than $0.01 per diluted share using 26.0 million shares
  • Adjusted EBITDA of $11.8 million
  • Non-GAAP net income of $11.6 million, or income of $0.41 per diluted share using 28.2 million shares

Full Year 2022 Financial Summary

  • Revenue of $257.8 million
  • GAAP gross margin of 53.5%; non-GAAP gross margin of 55.5%
  • GAAP net loss of $24.3 million, or loss of $0.95 per diluted share using 25.5 million shares
  • Adjusted EBITDA of $28.9 million
  • Non-GAAP net income of $26.3 million, or income of $0.96 per diluted share using 27.5 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.

First Quarter 2023 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 first quarter of 2023 (in millions, except per share data):

 

 

Three Months Ending

 

 

March 31, 2023

Revenue

 

$82.0 to $85.0

GAAP Net loss

 

($3.6) to ($2.1)

Adjusted EBITDA income

 

$9.2 to $10.7

GAAP Weighted-average shares — basic and diluted

 

26.20 to 26.40

GAAP Net loss per share — basic and diluted

 

($0.14) to ($0.08)

Non-GAAP Net income

 

$8.6 to $10.3

Non-GAAP Weighted-average shares — basic

 

26.20 to 26.40

Non-GAAP Weighted-average shares — diluted

 

28.30 to 28.50

Non-GAAP Net income per share — basic

 

$0.33 to $0.39

Non-GAAP Net income per share — diluted

 

$0.30 to $0.36

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, February 8, 2023 at 5:00 p.m. ET / 2:00 p.m. PT to discuss its fourth-quarter and full-year 2022 results, as well as its outlook for its first quarter 2023. 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 2251852.

Management’s prepared written remarks, along with quarterly financial data, will be made available on the company’s 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 our strategy, investment plans and prospects, as well as financial considerations for the first quarter of 2023 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)

 

 

December 31, 2022 (1)

 

December 31, 2021 (1)

Assets:

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

19,597

 

 

$

123,903

 

Short-term investments

 

154,148

 

 

 

69,443

 

Accounts receivable, net

 

49,996

 

 

 

35,449

 

Inventory

 

46,397

 

 

 

21,958

 

Prepaid expenses and other current assets

 

5,032

 

 

 

5,049

 

Total current assets

 

275,170

 

 

 

255,802

 

Long-term investments

 

19,200

 

 

 

14,225

 

Property and equipment, net

 

39,027

 

 

 

27,500

 

Operating lease right-of-use assets

 

10,490

 

 

 

11,667

 

Other non-current assets

 

1,969

 

 

 

2,462

 

Goodwill

 

3,881

 

 

 

3,881

 

Total assets

$

349,737

 

 

$

315,537

 

Liabilities and stockholders' equity (deficit):

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

25,024

 

 

$

11,732

 

Accrued compensation and employee related benefits

 

9,048

 

 

 

6,365

 

Accrued and other current liabilities

 

2,925

 

 

 

3,072

 

Current portion of operating lease liabilities

 

3,122

 

 

 

4,143

 

Current portion of long-term debt

 

 

 

 

9,633

 

Current portion of deferred revenue

 

2,250

 

 

 

558

 

Total current liabilities

 

42,369

 

 

 

35,503

 

Long-term debt, net of current portion

 

280,244

 

 

 

278,661

 

Operating lease liabilities, net of current portion

 

11,066

 

 

 

11,934

 

Other long-term liabilities

 

118

 

 

 

279

 

Deferred revenue, net of current portion

 

349

 

 

 

236

 

Total liabilities

 

334,146

 

 

 

326,613

 

Stockholders' equity (deficit):

 

 

 

Common stock, $0.001 par value

 

26

 

 

 

25

 

Additional paid-in capital

 

403,599

 

 

 

351,422

 

Accumulated other comprehensive loss

 

(1,249

)

 

 

(39

)

Accumulated deficit

 

(386,785

)

 

 

(362,484

)

Total stockholders' equity (deficit)

 

15,591

 

 

 

(11,076

)

Total liabilities and stockholders' equity (deficit)

$

349,737

 

 

$

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

 

Year Ended

 

 

December 31,

 

December 31,

 

 

2022

 

2021

 

2022

 

2021

Revenue

 

$

76,590

 

 

$

52,574

 

 

$

257,800

 

 

$

190,283

 

Cost of revenue

 

 

36,422

 

 

 

23,391

 

 

 

119,916

 

 

 

91,329

 

Gross profit

 

 

40,168

 

 

 

29,183

 

 

 

137,884

 

 

 

98,954

 

Operating expenses:

 

 

 

 

 

 

 

 

Research and development

 

 

18,982

 

 

 

17,578

 

 

 

74,106

 

 

 

64,058

 

Sales and marketing

 

 

9,655

 

 

 

9,710

 

 

 

37,894

 

 

 

34,287

 

General and administrative

 

 

11,577

 

 

 

9,125

 

 

 

45,465

 

 

 

36,137

 

Restructuring costs

 

 

(102

)

 

 

458

 

 

 

(102

)

 

 

1,721

 

Total operating expenses

 

 

40,112

 

 

 

36,871

 

 

 

157,363

 

 

 

136,203

 

Income (loss) from operations

 

 

56

 

 

 

(7,688

)

 

 

(19,479

)

 

 

(37,249

)

Other income, net

 

 

1,150

 

 

 

4

 

 

 

2,517

 

 

 

25

 

Induced conversion expense

 

 

 

 

 

(11,333

)

 

 

(2,232

)

 

 

(11,333

)

Interest expense

 

 

(1,207

)

 

 

(974

)

 

 

(4,923

)

 

 

(2,550

)

Loss before income taxes

 

 

(1

)

 

 

(19,991

)

 

 

(24,117

)

 

 

(51,107

)

Income tax expense

 

 

(117

)

 

 

(23

)

 

 

(184

)

 

 

(153

)

Net loss

 

$

(118

)

 

$

(20,014

)

 

$

(24,301

)

 

$

(51,260

)

Net loss per share — basic and diluted

 

$

(0.00

)

 

$

(0.81

)

 

$

(0.95

)

 

$

(2.12

)

Weighted-average shares — basic and diluted

 

 

26,005

 

 

 

24,581

 

 

 

25,539

 

 

 

24,176

 

IMPINJ, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands, unaudited)

 

 

 

Year Ended

 

 

December 31,

 

 

2022

 

2021

Operating activities:

 

 

 

 

Net loss

 

$

(24,301

)

 

$

(51,260

)

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

 

 

 

 

Depreciation

 

 

6,044

 

 

 

4,602

 

Stock-based compensation

 

 

42,443

 

 

 

40,498

 

Accretion of discount or amortization of premium on investments

 

 

(233

)

 

 

896

 

Amortization of debt issuance costs

 

 

1,601

 

 

 

568

 

Induced conversion expense related to convertible notes

 

 

2,232

 

 

 

11,333

 

Loss on fixed asset disposal

 

 

57

 

 

 

 

Settlement and related costs

 

 

 

 

 

(460

)

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

 

(14,547

)

 

 

(10,446

)

Inventory

 

 

(24,439

)

 

 

14,371

 

Prepaid expenses and other assets

 

 

852

 

 

 

(770

)

Accounts payable

 

 

7,371

 

 

 

2,340

 

Accrued compensation and employee related benefits

 

 

2,683

 

 

 

836

 

Accrued and other liabilities

 

 

(215

)

 

 

987

 

Operating lease right-of-use assets

 

 

3,414

 

 

 

2,792

 

Operating lease liabilities

 

 

(4,126

)

 

 

(3,528

)

Deferred revenue

 

 

1,805

 

 

 

(6,294

)

Net cash provided by operating activities

 

 

641

 

 

 

6,465

 

Investing activities:

 

 

 

 

Purchases of investments

 

 

(205,749

)

 

 

(84,412

)

Proceeds from maturities of investments

 

 

114,750

 

 

 

82,000

 

Proceeds from sale of property and equipment

 

 

279

 

 

 

 

Purchases of property and equipment

 

 

(12,079

)

 

 

(16,230

)

Net cash used in investing activities

 

 

(102,799

)

 

 

(18,642

)

Financing activities:

 

 

 

 

Principal payments on finance lease obligations

 

 

 

 

 

(2

)

Proceeds from exercise of stock options and employee stock purchase plan

 

 

15,416

 

 

 

17,648

 

Proceeds from issuance of 2021 Notes, net of issuance costs

 

 

 

 

 

278,422

 

Payment of 2019 Notes

 

 

(17,564

)

 

 

(183,624

)

Net cash provided by (used in) financing activities

 

 

(2,148

)

 

 

112,444

 

Net increase (decrease) in cash and cash equivalents

 

 

(104,306

)

 

 

100,267

 

Cash and cash equivalents

 

 

 

 

Beginning of period

 

 

123,903

 

 

 

23,636

 

End of period

 

$

19,597

 

 

$

123,903

 

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; restructuring costs; settlement and related costs; other income, net; interest expense; loss on debt extinguishment; and income tax benefit (expense). We have excluded these costs and expenses because we do not believe they reflect our core operations and us excluding them enables more consistent evaluation of our operating performance.

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; restructuring costs; settlement and related costs; amortization of debt discount related to the equity component of our convertible notes; and prepayment penalty on debt extinguishment.

GAAP requires that certain convertible debt instruments that may be settled in cash on conversion be accounted for as separate liability and equity components in a manner that reflects our non-convertible debt borrowing rate. This accounting results in the debt component being treated as though it was issued at a discount, with the debt discount being amortized as additional non-cash interest expense over the debt instrument term using the effective interest method. As a result, we believe that excluding this non-cash interest expense attributable to the debt discount in calculating our non-GAAP net income (loss) is useful because this interest expense is not indicative of our ongoing operational performance.

IMPINJ, INC.

RECONCILIATIONS OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES

(in thousands, except percentages, unaudited)

 

 

 

Three Months Ended

 

Year Ended

 

 

December 31,

 

December 31,

 

 

2022

 

2021

 

2022

 

2021

GAAP Gross margin

 

 

52.4

%

 

 

55.5

%

 

 

53.5

%

 

 

52.0

%

Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

1.2

%

 

 

1.6

%

 

 

1.4

%

 

 

1.2

%

Stock-based compensation

 

 

0.2

%

 

 

1.1

%

 

 

0.6

%

 

 

1.0

%

Non-GAAP Gross margin

 

 

53.8

%

 

 

58.2

%

 

 

55.5

%

 

 

54.2

%

 

 

 

 

 

 

 

 

 

GAAP Net loss

 

$

(118

)

 

$

(20,014

)

 

$

(24,301

)

 

$

(51,260

)

Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

1,588

 

 

 

1,431

 

 

 

6,044

 

 

 

4,602

 

Stock-based compensation

 

 

10,213

 

 

 

11,547

 

 

 

42,443

 

 

 

40,498

 

Other income, net

 

 

(1,150

)

 

 

(4

)

 

 

(2,517

)

 

 

(25

)

Interest expense

 

 

1,207

 

 

 

974

 

 

 

4,923

 

 

 

2,550

 

Income tax expense

 

 

117

 

 

 

23

 

 

 

184

 

 

 

153

 

Settlement and related costs

 

 

 

 

 

(460

)

 

 

 

 

 

(460

)

Restructuring costs

 

 

(102

)

 

 

458

 

 

 

(102

)

 

 

1,721

 

Induced conversion expense

 

 

 

 

 

11,333

 

 

 

2,232

 

 

 

11,333

 

Adjusted EBITDA

 

$

11,755

 

 

$

5,288

 

 

$

28,906

 

 

$

9,112

 

 

 

 

 

 

 

 

 

 

GAAP Net loss

 

$

(118

)

 

$

(20,014

)

 

$

(24,301

)

 

$

(51,260

)

Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

1,588

 

 

 

1,431

 

 

 

6,044

 

 

 

4,602

 

Stock-based compensation

 

 

10,213

 

 

 

11,547

 

 

 

42,443

 

 

 

40,498

 

Settlement and related costs

 

 

 

 

 

(460

)

 

 

 

 

 

(460

)

Restructuring costs

 

 

(102

)

 

 

458

 

 

 

(102

)

 

 

1,721

 

Induced conversion expense

 

 

 

 

 

11,333

 

 

 

2,232

 

 

 

11,333

 

Non-GAAP Net income

 

$

11,581

 

 

$

4,295

 

 

$

26,316

 

 

$

6,434

 

 

 

 

 

 

 

 

 

 

Non-GAAP Net income per share:

 

 

 

 

 

 

 

 

Basic

 

$

0.45

 

 

$

0.17

 

 

$

1.03

 

 

$

0.27

 

Diluted

 

$

0.41

 

 

$

0.16

 

 

$

0.96

 

 

$

0.25

 

GAAP and non-GAAP Weighted-average shares — basic

 

 

26,005

 

 

 

24,581

 

 

 

25,539

 

 

 

24,176

 

 

 

 

 

 

 

 

 

 

GAAP Weighted-average shares — diluted

 

 

26,005

 

 

 

24,581

 

 

 

25,539

 

 

 

24,176

 

Dilutive shares from stock plans

 

 

2,147

 

 

 

2,195

 

 

 

1,811

 

 

 

1,768

 

Dilutive shares from 2019 Notes

 

 

 

 

 

 

 

 

127

 

 

 

 

Non-GAAP Weighted-average shares — diluted

 

 

28,152

 

 

 

26,776

 

 

 

27,477

 

 

 

25,944

 

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

 

 

March 31,

 

 

2023

GAAP Net loss

 

$

(2,850

)

Adjustments:

 

 

Forecasted Depreciation

 

 

1,730

 

Forecasted Stock-based compensation

 

 

10,500

 

Forecasted Interest expense

 

 

1,250

 

Forecasted Other income, net

 

 

(750

)

Forecasted Income tax expense

 

 

60

 

Adjusted EBITDA

 

$

9,940

 

 

 

 

GAAP Net loss

 

$

(2,850

)

Adjustments:

 

 

Forecasted Depreciation

 

 

1,730

 

Forecasted Stock-based compensation

 

 

10,500

 

Non-GAAP Net income

 

$

9,380

 

 

 

 

GAAP Net loss per share — basic and diluted

 

$

(0.11

)

Non-GAAP Net income per share

 

 

Basic

 

$

0.36

 

Diluted

 

$

0.33

 

 

 

 

GAAP weighted-average shares — basic and diluted

 

 

26,300

 

 

 

 

Non-GAAP weighted-average shares — basic

 

 

26,300

 

Dilutive shares from stock plans

 

 

2,100

 

Non-GAAP weighted-average shares — diluted

 

 

28,400

 

 

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.