- Delivers Q2 Revenue of $52.1M, up 102% YoY and 29%
Sequentially
- Expands Non-GAAP Gross Margin 363 Basis Points YoY to
52.2%
- Secures Large Program Win at Bosch
- Guides Q3 2023 Revenue up 100% YoY and 15% Sequentially to a
$240M Annualized Run-rate
- Reiterates Plan to Reach Non-GAAP Operating Income in Q4 and
More Than Double Revenue in 2023
indie Semiconductor, Inc. (Nasdaq: INDI), an Autotech solutions
innovator, today announced Q2 results for the period ended June 30,
2023. Second quarter revenue was up 102 percent from the same
period a year ago and 29 percent sequentially to a record $52.1
million, at the higher end of the Company’s guidance range and
slightly ahead of consensus estimates. Non-GAAP gross margin
expanded 363 basis points year-over-year to 52.2 percent and was
also better than guidance. On a GAAP basis, second quarter 2023
operating loss was $40.7 million compared to $30.0 million a year
ago. Non-GAAP operating loss for the second quarter of 2023 was
$16.3 million, versus $17.0 million during the same period last
year, reflecting deeper R&D and SG&A investments yet a 35
percentage point improvement in operating margin.
“We once again delivered revenue and gross margin ahead of
expectations in the second quarter of 2023, putting us on pace to
more than double indie’s business base for a third year in a row,”
said Donald McClymont, indie’s co-founder and chief executive
officer. “Our steep growth trajectory reflects design win momentum
across ADAS, user experience and electric vehicle applications.
indie is increasingly well positioned to capitalize on these triple
megatrends and the resulting $48 billion Autotech market
opportunity, backed by our highly innovative semiconductor and
software portfolio, targeted acquisitions, more than 400 patents
and applications worldwide as well as engagements across all
leading global automotive OEMs.”
Business Highlights
- Captured occupant monitoring program win at Bosch, initially in
support of Toyota including Lexus
- Ramped highly integrated smartphone vehicle access and driving
authorization solutions with Marquardt
- Launched breakthrough automotive wireless power charging
system-on-chip
- Entered strategic technology partnership with SiLC Technologies
to deliver world-class FMCW LiDAR solutions
- Released first ESG report highlighting adherence to
environmental sustainability, social commitments and disciplined
corporate governance
Q3 2023 Outlook
We provide guidance on a non-GAAP basis only because certain
information necessary to reconcile such results and guidance to
GAAP is difficult to estimate and dependent on future events
outside of our control and, therefore, is not available without
unreasonable efforts. Please refer to the attached Discussion
Regarding the Use of Non-GAAP Financial Measures in this press
release for a further discussion of our use of non-GAAP
measures.
“Based on strong order flow and the depth of our design win
pipeline, we plan to continue to deliver outsized top line growth
over the forecast horizon, towards our 60 percent gross and 30
percent operating margin target model,” said Thomas Schiller,
indie’s chief financial officer and executive vice president of
strategy. “In the meantime, for the third quarter of 2023, we
intend to scale into a $240 million annualized revenue run-rate, up
100 percent year-over-year and 15 percent sequentially as well as
up more than 10-fold versus our 2020 revenue level, with further
non-GAAP gross margin improvement, yielding a narrower operating
loss. Perhaps most importantly, we remain on track to achieve
non-GAAP operating income in the fourth quarter of this year,
driven by sustained sales growth, gross margin expansion and
operating expense leverage.”
indie’s Q2 2023 Conference Call
indie Semiconductor will host a conference call with analysts to
discuss its second quarter 2023 results and business outlook today
at 5:00 p.m. Eastern time. To listen to the conference call via the
Internet, please go to the Financials tab on the Investors page of
indie’s website. To listen to the conference call via telephone,
please call (877) 451-6152 (domestic) or (201) 389-0879
(international), Conference ID: 13739919.
A replay of the conference call will be available beginning at
9:00 p.m. Eastern time on August 10, 2023 until 11:59 p.m. Eastern
time on August 24, 2023 under the Financials tab on the Investors
page of indie’s website, or by calling (844) 512-2921 (domestic) or
(412) 317-6671 (international), Replay Pin Number: 13739919.
About indie
indie is empowering the Autotech revolution with next generation
automotive semiconductors and software platforms. We focus on
developing innovative, high-performance and energy-efficient
technology for ADAS, user experience and electrification
applications. Our mixed-signal SoCs enable edge sensors spanning
Radar, LiDAR, Ultrasound, and Computer Vision, while our embedded
system control, power management and interfacing solutions
transform the in-cabin experience and accelerate increasingly
automated and electrified vehicles. We are an approved vendor to
Tier 1 partners and our solutions can be found in marquee
automotive OEMs worldwide. Headquartered in Aliso Viejo, CA, indie
has design centers and regional support offices across the United
States, Canada, Argentina, Scotland, England, Germany, Hungary,
Morocco, Israel, Japan, South Korea and China.
Please visit us at www.indiesemi.com to learn more.
Safe Harbor Statement
This communication contains “forward-looking statements”
(including within the meaning of Section 21E of the United States
Securities Exchange Act of 1934, as amended, and Section 27A of the
Securities Act of 1933, as amended). Such statements can be
identified by words such as “will likely result,” “expect,”
“anticipate,” “estimate,” “believe,” “intend,” “plan,” “project,”
“outlook,” “should,” “could,” “may” or words of similar meaning and
include, but are not limited to, statements regarding our future
business and financial performance and prospects, including
expectations regarding our guidance for top line growth, annualized
run-rate, non-GAAP financial metrics such as gross and operating
margin, operating income (loss), operating expenses, and our belief
that we are on track to reach non-GAAP operating income in the
fourth quarter 2023, and our ability to gain design win momentum
across ADAS, vehicle electrification and user experience
applications and capitalize on these growing trends and the
resulting $48 billion Autotech market opportunity. Such
forward-looking statements are based upon the current beliefs and
expectations of our management and are inherently subject to
significant business, economic and competitive uncertainties and
contingencies, many of which are difficult to predict and generally
beyond our control. Actual results and the timing of events may
differ materially from the results included in such forward-looking
statements. In addition to the factors previously disclosed in our
Annual Report on Form 10-K for the fiscal year ended December 31,
2022 filed with the SEC on March 28, 2023 and in our other public
reports filed with the SEC (including those identified under “Risk
Factors” therein), the following factors, among others, could cause
actual results and the timing of events to differ materially from
the anticipated results or other expectations expressed in the
forward-looking statements: macroeconomic conditions, including
inflation, rising interest rates and volatility in the credit and
financial markets; our reliance on contract manufacturing and
outsourced supply chain and the availability of semiconductors and
manufacturing capacity; competitive products and pricing pressures;
our ability to win competitive bid selection processes and achieve
additional design wins; the impact of recent acquisitions made and
any other acquisitions we may make, including our ability to
successfully integrate acquired businesses and risks that the
anticipated benefits of any acquisitions may not be fully realized
or take longer to realize than expected; our ability to develop,
market and gain acceptance for new and enhanced products and expand
into new technologies and markets; trade restrictions and trade
tensions; and political or economic instability in our target
markets. All forward-looking statements in this press release are
expressly qualified in their entirety by the foregoing cautionary
statements.
Investors are cautioned not to place undue reliance on the
forward-looking statements in this press release, which information
set forth herein speaks only as of the date hereof. We do not
undertake, and we expressly disclaim, any intention or obligation
to update any forward-looking statements made in this announcement
or in our other public filings, whether as a result of new
information, future events or otherwise, except as required by
law.
INDIE SEMICONDUCTOR, INC. PRELIMINARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in
thousands, except share and per share amounts)
(Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Revenue:
Product revenue
$
45,455
$
20,452
$
79,108
$
38,538
Contract revenue
6,653
5,303
13,452
9,216
Total revenue
52,108
25,755
92,560
47,754
Operating expenses:
Cost of goods sold
32,127
15,178
56,183
29,370
Research and development
42,069
28,467
78,632
57,966
Selling, general, and administrative
18,637
12,085
35,451
24,727
Total operating expenses
92,833
55,730
170,266
112,063
Loss from operations
(40,725
)
(29,975
)
(77,706
)
(64,309
)
Other income (expense), net:
Interest income
1,870
175
4,289
208
Interest expense
(2,144
)
(267
)
(4,292
)
(325
)
Gain (loss) from change in fair value of
warrants
25,046
20,301
(22,286
)
67,654
Gain from change in fair value of
contingent considerations and acquisition-related holdbacks
2,303
3,584
673
3,667
Other income (expense)
429
9
429
(21
)
Total other income (expense), net
27,504
23,802
(21,187
)
71,183
Net income (loss) before income taxes
(13,221
)
(6,173
)
(98,893
)
6,874
Income tax benefit (expense)
(342
)
869
3,364
1,528
Net income (loss)
(13,563
)
(5,304
)
(95,529
)
8,402
Less: Net income (loss) attributable to
noncontrolling interest
(436
)
(1,070
)
(9,656
)
1,803
Net income (loss) attributable to indie
Semiconductor, Inc.
$
(13,127
)
$
(4,234
)
$
(85,873
)
$
6,599
Net income (loss) attributable to common
shares — basic
$
(13,127
)
$
(4,234
)
$
(85,873
)
$
6,599
Net income (loss) attributable to common
shares — diluted
$
(13,127
)
$
(4,234
)
$
(85,873
)
$
6,599
Net income (loss) per share attributable
to common shares — basic
$
(0.09
)
$
(0.04
)
$
(0.63
)
$
0.06
Net income (loss) per share attributable
to common shares — diluted
$
(0.09
)
$
(0.04
)
$
(0.63
)
$
0.04
Weighted average common shares outstanding
— basic
141,973,731
116,983,265
136,760,936
114,102,308
Weighted average common shares outstanding
— diluted
141,973,731
116,983,265
136,760,936
150,740,655
INDIE SEMICONDUCTOR, INC. PRELIMINARY
CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in
thousands) (Unaudited)
June 30, 2023
December 31,
2022
Assets
Current assets:
Cash and cash equivalents
$
180,660
$
321,629
Restricted cash
—
250
Accounts receivable, net
34,904
26,441
Inventory, net
40,871
13,256
Prepaid expenses and other current
assets
23,081
12,290
Total current assets
279,516
373,866
Property and equipment, net
22,390
15,829
Intangible assets, net
181,438
63,117
Goodwill
281,772
136,463
Operating lease right-of-use assets
11,862
12,055
Other assets and deposits
3,863
2,021
Total assets
$
780,841
$
603,351
Liabilities and stockholders' equity
Accounts payable
$
16,997
$
14,186
Accrued payroll liabilities
10,976
11,541
Accrued expenses and other current
liabilities
63,069
13,159
Intangible asset contract liability
9,419
9,377
Current debt obligations
3,659
15,700
Total current liabilities
104,120
63,963
Long-term debt, net of current portion
156,213
155,699
Warrant liability
67,684
45,398
Intangible asset contract liability, net
of current portion
—
4,177
Deferred tax liabilities, non-current
10,768
7,823
Operating lease liability, non-current
9,461
10,115
Other long-term liabilities
47,396
1,844
Total liabilities
$
395,642
$
289,019
Commitments and contingencies
Stockholders' equity
Preferred stock
$
—
$
—
Class A common stock
14
13
Class V common stock
2
2
Additional paid-in capital
725,461
568,564
Accumulated deficit
(329,689
)
(243,816
)
Accumulated other comprehensive loss
(9,513
)
(11,951
)
indie's stockholders' equity
386,275
312,812
Noncontrolling interest
(1,076
)
1,520
Total stockholders' equity
385,199
314,332
Total liabilities and stockholders'
equity
$
780,841
$
603,351
INDIE SEMICONDUCTOR, INC.
RECONCILIATION OF PRELIMINARY NON-GAAP MEASURES TO GAAP
(Unaudited)
GAAP refers to financial information presented in accordance
with U.S. Generally Accepted Accounting Principles. This
announcement includes non-GAAP financial measures, as defined in
Regulation G promulgated by the Securities and Exchange Commission.
We believe that our presentation of non-GAAP financial measures
provides useful supplementary information to investors. The
presentation of non-GAAP financial measures is not meant to be
considered in isolation from or as a substitute for results
prepared in accordance with GAAP.
The reconciliations of our preliminary GAAP to non-GAAP measures
are as follows (in thousands, except share and per share
amounts):
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Computation of non-GAAP gross margin:
GAAP revenue
$
52,108
$
25,755
$
92,560
$
47,754
GAAP cost of goods sold
32,127
15,178
56,183
29,370
Acquisition-related expenses
(7,165
)
(1,920
)
(11,832
)
(4,542
)
Share-based compensation
(68
)
(13
)
(136
)
(13
)
Non-GAAP gross profit
$
27,214
$
12,510
$
48,345
$
22,939
Non-GAAP gross margin
52.2
%
48.6
%
52.2
%
48.0
%
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Computation of non-GAAP operating
loss:
GAAP loss from operations
$
(40,725
)
$
(29,975
)
$
(77,706
)
$
(64,309
)
Acquisition-related expenses
11,107
4,222
19,663
9,673
Share-based compensation
13,292
8,767
24,918
21,182
Non-GAAP operating loss
$
(16,326
)
$
(16,986
)
$
(33,125
)
$
(33,454
)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Computation of non-GAAP net loss:
GAAP Net income (loss)
$
(13,563
)
$
(5,304
)
$
(95,529
)
$
8,402
Acquisition-related expenses
11,107
4,222
19,663
9,673
Share-based compensation
13,292
8,767
24,918
21,182
(Gain) loss from change in fair value of
warrants
(25,046
)
(20,301
)
22,286
(67,654
)
Gain from change in fair value of
contingent considerations and acquisition-related holdbacks
(2,303
)
(3,584
)
(673
)
(3,667
)
Other income
(429
)
—
(429
)
—
Non-cash interest expense
240
150
499
150
Income taxes (benefits) expense
342
(869
)
(3,364
)
(1,528
)
Non-GAAP net loss
$
(16,360
)
$
(16,919
)
$
(32,629
)
$
(33,442
)
Three Months Ended June 30,
2023
Computation of non-GAAP share count:
Weighted Average Class A common stock -
Basic
141,973,731
Weighted Average Class V common stock -
Basic
19,520,734
Escrow Shares
1,725,000
TeraXion Unexercised Options
929,089
Non-GAAP share count
164,148,554
Non-GAAP net loss
$
(16,360
)
Non-GAAP net loss per share
$
(0.10
)
Discussion Regarding the Use of Non-GAAP
Financial Measures
Our earnings release contains some or all of the following
financial measures that have not been calculated in accordance with
United States Generally Accepted Accounting Principles (“GAAP”):
(i) non-GAAP gross profit and gross margin, (ii) non-GAAP operating
loss, (iii) non-GAAP net loss, (iv) non-GAAP share count and (v)
non-GAAP net loss per share. As set forth in the tables above, we
derive such non-GAAP financial measures by excluding certain
expenses and other items from the respective GAAP financial measure
that is most directly comparable to each non-GAAP financial
measure. Management may use these non-GAAP financial measures to,
amongst other things, evaluate operating performance and compare it
against past periods or against peer companies, make operating
decisions, forecast for future periods and to determine payments
under compensation programs. These non-GAAP financial measures
provide management with additional means to understand and evaluate
the operating results and trends in our ongoing business by
eliminating certain expenses and other items that management
believes might otherwise make comparisons of our ongoing business
with prior periods and competitors more difficult, obscure trends
in ongoing operations or improve management’s ability to forecast
future periods.
We provide investors with non-GAAP gross profit and gross
margin, non-GAAP operating loss, non-GAAP net loss and non-GAAP net
loss per share because we believe it is important for investors to
be able to closely monitor and understand changes in our ability to
generate income from ongoing business operations. We believe these
non-GAAP financial measures give investors an additional method to
evaluate historical operating performance and identify trends, an
additional means of evaluating period-over-period operating
performance and a method to facilitate certain comparisons of our
operating results to those of our peer companies. We further
believe these non-GAAP financial measures allow investors to assess
the overall financial performance of our ongoing operations by
eliminating the impact of (i) acquisition-related expenses
(including acquisition-related professional fees and legal
expenses, deemed compensation expense, amortization of
acquisition-related intangibles and certain license rights, and
expenses recognized in relation to changes in contingent
consideration obligations), (ii) gains or losses recognized in
relation to changes in the fair value of warrants, contingent
considerations issued by indie, acquisition-related holdbacks and
unrealized gains or losses from currency hedging contracts, (iii)
non-cash interest expenses related to the amortization of debt
discounts and issuance costs, (iv) share-based compensation, and
(v) income tax benefit (expenses). We believe that disclosing these
non-GAAP financial measures contributes to enhanced financial
reporting transparency and provides investors with added clarity
about complex financial performance measures.
We do not report a GAAP measure of gross profit or gross margin
because certain costs related to contract revenues are expensed as
incurred and included in research and development expenses, and not
in cost of sales, as it is not practicable for us to bifurcate
these expenses. We derive and reconcile non-GAAP gross profit from
the most relevant GAAP financial measures by subtracting GAAP cost
of sales, adjusted for acquisition-related expenses and share-based
compensation, from GAAP revenue. We calculate non-GAAP operating
loss by excluding from GAAP operating loss, any (i)
acquisition-related expenses (including acquisition-related
professional fees and legal expenses, deemed compensation expense,
amortization of acquisition-related intangibles and expenses
recognized in relation to changes in contingent consideration
obligations) and share-based compensation. We calculate non-GAAP
net loss by excluding from GAAP net income (loss), any (i)
acquisition-related expenses (including acquisition-related
professional fees and legal expenses, deemed compensation expense,
and amortization of acquisition-related intangibles and certain
license rights, and expenses recognized in relation to changes in
contingent consideration obligations), (ii) gains or losses
recognized in relation to change in the fair value of warrants,
contingent considerations issued by indie and acquisition-related
holdbacks, (iii) non-cash interest expenses related to the
amortization of debt discounts and issuance costs, (iv) share-based
compensation, and (v) income tax benefit (expense). We calculate
non-GAAP share count by adding (i) weighted average Class A common
stock, (ii) weighted average Class V common stock, (iii) Escrow
Shares and (iv) vested but unexercised options issued as part of
the TeraXion acquisition. Non-GAAP net loss per share is calculated
by non-GAAP loss divided by non-GAAP share count.
We exclude the items identified above from the respective
non-GAAP financial measure referenced above for the reasons set
forth with respect to each such excluded item below:
Acquisition-related expenses - including such items as, when
applicable, amortization of acquired intangible assets and certain
license rights, fair value charges incurred upon the sale of
acquired inventory, and acquisition-related professional fees and
legal expenses because they are not considered by management in
making operating decisions and we believe that such expenses do not
have a direct correlation to our future business operations and
thereby including such charges do not necessarily reflect the
performance of our ongoing operations for the period in which such
charges or reversals are incurred.
Share-based compensation - related to the non-cash compensation
expense associated with equity awards granted to our employees and
employer tax related to employee stock transactions. These expenses
are not considered by management in making operating decisions and
such expenses do not have a direct correlation to our future
business operations.
Gain (loss) from change in fair values - because these
adjustments (1) are not considered by management in making
operating decisions, (2) are not directly controlled by management,
(3) do not necessarily reflect the performance of our ongoing
operations for the period in which such charges are recognized and
(4) cannot make comparisons between peer company performance less
reliable.
Non-cash interest expense - related to the amortization of debt
discounts and issuance costs because (1) these expenses are not
considered by management in making decision with respect to
financing decisions, and (2) these generally reflect non-cash
costs.
Income tax benefit (expense) - related to the estimated income
tax benefit (expense) that does not result in a current period tax
refunds (payments).
The non-GAAP financial measures presented should not be
considered in isolation and are not an alternative for the
respective GAAP financial measure that is most directly comparable
to each such non-GAAP financial measure. Investors are cautioned
against placing undue reliance on these non-GAAP financial measures
and are urged to review and consider carefully the adjustments made
by management to the most directly comparable GAAP financial
measures to arrive at these non-GAAP financial measures. Non-GAAP
financial measures may have limited value as analytical tools
because they may exclude certain expenses that some investors
consider important in evaluating our operating performance or
ongoing business performance. Further, non-GAAP financial measures
are likely to have limited value for purposes of drawing
comparisons between companies as a result of different companies
potentially calculating similarly titled non-GAAP financial
measures in different ways because non-GAAP measures are not based
on any comprehensive set of accounting rules or principles.
To the extent our disclosures contain forward-looking estimates
of non-GAAP financial measures, these measures are provided to
investors on a prospective basis for the same reasons (set forth
above) we provide them to investors on a historical basis. We are
generally unable to provide a reconciliation of our forward-looking
non-GAAP measures because certain information needed to make a
reasonable forward-looking estimate of such non-GAAP measures are
difficult to predict and estimate and is often dependent on future
events that may be uncertain or outside of our control and,
therefore, is not available without unreasonable efforts. Such
events may include unanticipated changes in our GAAP effective tax
rate, unanticipated one-time charges related to asset impairments
(fixed assets, inventory, intangibles, or goodwill), unanticipated
acquisition-related expenses, unanticipated settlements, gains,
losses and impairments and other unanticipated items not reflective
of ongoing operations. Our forward-looking estimates of both GAAP
and non-GAAP measures of our financial performance may differ
materially from our actual results and should not be relied upon as
statements of fact.
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