– Company Issues Outlook for 2022
–
- Q4 Total Contract Value (“TCV”)1 of $17.9 million, up 201%
year-over-year
- Q4 Revenue of $6.8 million, up 236% year-over-year
- Full Year TCV1 of $53.8 million, up 148%
year-over-year
- Full Year Revenue of $23.7 million, up 395%
year-over-year
Evolv Technology (NASDAQ: EVLV), the global leader in AI-based
weapons detection security screening, today announced financial
results for its fourth quarter and year ended December 31, 20212
and issued its business outlook for 2022.
“We’re pleased to be reporting strong fourth quarter results
highlighted by a record number of new customers across our key
vertical markets, the launch of several demand-driven offerings,
and continuing momentum with our channel-centric go to market
strategy,” said Peter George, Chief Executive Officer of Evolv
Technology. “Looking ahead to 2022, we plan to continue focusing on
the opportunities we see to leverage our solutions to democratize
security for facilities and venues in all of our target markets. We
believe we enter the new year well-positioned and highly motivated
to extend our leadership position in the rapidly growing market for
AI-based weapons detection.”
Results for the Fourth Quarter of 2021
Total revenue for the fourth quarter of 2021 was $6.8 million,
an increase of 236% compared to $2.0 million for the fourth quarter
of 2020. Total Contract Value (“TCV”)1 of orders booked for the
fourth quarter of 2021 was $17.9 million, an increase of 201%
compared to $6.0 million in the fourth quarter of 2020. Annual
Recurring Revenue (“ARR”)3 was $12.9 million at the end of fourth
quarter of 2021, an increase of 220% compared to $4.0 million in
the fourth quarter of 2020. Net income for the fourth quarter of
2021 was $2.5 million, or $0.02 per basic and diluted share,
compared to net loss of $9.6 million, or $1.06 per basic and
diluted share, for the fourth quarter of 2020. As of December 31,
2021, the Company had cash and cash equivalents of $307.5 million
compared to $4.7 million as of December 31, 2020.
Results for 2021
Total revenue in 2021 was $23.7 million, an increase of 395%
compared to $4.8 million in 2020. TCV of orders booked in 2021 was
$53.8 million, an increase of 148% compared to $21.7 million in
2020. Net loss in 2021 was $10.9 million, or $0.15 per basic and
diluted share, compared to net loss of $27.4 million, or $3.07 per
basic and diluted share, in 2020.
Company Issues Outlook for 2022
The Company today issued its business outlook for 2022. The
Company's outlook is based on the current indications for its
business, which may change at any time.
Estimate
(In Millions)
2021
Actual
2022
Business Outlook
Total Revenue
$23.7
$29-$31
Annual Recurring Revenue3 at 12/31
$12.9
$27-$28
Operating Expenses
$60.7
$94-$96
Operating Loss
($54.0)
($82-$84)
Adjusted EBITDA4
n/m
($65-$67)
Cash and Cash Equivalents
$307.5
$220-$230
Company to Host Live Conference Call and Webcast
The Company’s management team plans to host a live conference
call and webcast at 4:30 p.m. Eastern Time today to discuss the
financial results as well as management’s outlook for the business
and other matters. The conference call may be accessed in the
United States by dialing +1.844.867.6169 and using access code
1400696. The conference call may be accessed outside of the United
States by dialing +1.409.207.6975 and using access code 1400696.
The conference call will be simultaneously webcast on the Company’s
Investor Relations website, which can be accessed at
http://ir.evolvtechnology.com. A replay of the conference call will
be available for a period of 30 days by dialing +1.866.207.1041 or
+1.402.970.0847 and using access code 1987557 or by accessing the
webcast replay on the Company’s investor relations website at
http://ir.evolvtechnology.com. The Company has used, and intends to
continue to use, the investor relations portion of its website as a
means of disclosing material non-public information and for
complying with disclosure obligations under Regulation FD.
About Evolv Technology
Evolv Technology (NASDAQ: EVLV) is the global leader in weapons
detection security screening. Our mission is enabling a better
experience and better security for venues, creating a safer world
to work, learn, and play by transforming physical security to make
everywhere safer. This enhances the visitor experience and improves
weapons detection. We give sports fans, theme park visitors,
concert goers, shoppers, employees, students, and others peace of
mind so that they can gather without fear of violence. Our security
system, delivered as a SaaS-based offering, has scanned more than
200 million people, second only to the Department of Homeland
Security’s Transportation Security Administration in the United
States, and our technology combines powerful, advanced sensors with
proven artificial intelligence (AI), security ecosystem
integrations, and comprehensive venue analytics to reliably detect
threats 10 times faster than traditional metal detectors. Evolv
Technology, Evolv Express®, Evolv Insights™, and Evolv Cortex AI™
are registered trademarks or trademarks of Evolv Technologies, Inc.
in the United States and other jurisdictions. For more information,
visit https://evolvtechnology.com.
1 We define Total Contract Value, or TCV, of orders
booked as the total value of the contract over the specified term.
Our calculation of TCV is not adjusted for the impact of any known
or projected future events (such as customer cancellations,
upgrades or downgrades, or price increases or decreases). TCV
should be viewed independently of, and not as a substitute for or
forecast of, revenue and deferred revenue. Our calculation of TCV
may differ from similarly titled metrics presented by other
companies.
2 Amounts herein pertaining to December 31, 2021 represent a
preliminary estimate as of the date of this earnings release. More
information on our results of operations for the three and twelve
months ended December 31, 2021 will be provided upon filing our
Annual Report on Form 10-K with the Securities and Exchange
Commission.
3 We define Annual Recurring Revenue, or ARR, as
subscription revenue and the recurring service revenue related to
purchase subscriptions for the final month of the quarter
normalized to a one-year period. Our calculation of ARR is not
adjusted for the impact of any known or projected future events
(such as customer cancellations, upgrades or downgrades, or price
increases or decreases) that may cause any such contract not to be
renewed on its existing terms. In addition, the amount of actual
revenue that we recognize over any 12-month period is likely to
differ from ARR at the beginning of that period, sometimes
significantly. This may occur due to new bookings, cancellations,
upgrades, downgrades or other changes in pending renewals, as well
as the effects of professional services revenue and acquisitions or
divestitures. As a result, ARR should be viewed independently of,
and not as a substitute for or forecast of, revenue and deferred
revenue. Our calculation of ARR may differ from similarly titled
metrics presented by other companies.
4 Non-GAAP Financial Measures In this press release, the
Company’s adjusted gross profit, adjusted gross margin, and
adjusted EBITDA are not presented in accordance with generally
accepted accounting principles (GAAP) and are not intended to be
used in lieu of GAAP presentations of results of operations.
Adjusted gross profit and adjusted gross margin exclude one-time
items and depreciation and amortization which management believes
provides a more meaningful representation of contribution margin.
Adjusted EBITDA is defined as net income (loss) plus depreciation
and amortization, share-based compensation and other expense.
Management presents non-GAAP financial measures because it
considers them to be important supplemental measures of
performance. Management uses non-GAAP financial measures for
planning purposes, including analysis of the Company's performance
against prior periods, the preparation of operating budgets and to
determine appropriate levels of operating and capital investments.
Management also believes non-GAAP financial measures provide
additional insight for analysts and investors in evaluating the
Company's financial and operational performance. However, non-GAAP
financial measures have limitations as an analytical tool and are
not intended to be an alternative to financial measures prepared in
accordance with GAAP. We intend to provide non-GAAP financial
measures as part of our future earnings discussions and, therefore,
the inclusion of non-GAAP financial measures will provide
consistency in our financial reporting. Investors are encouraged to
review the reconciliation of these non-GAAP measures to their most
directly comparable GAAP financial measures. A reconciliation of
our non-GAAP financial measures to their most directly comparable
GAAP measures has been provided in this press release.
Forward-Looking Statements
Certain statements in this press release may constitute
“forward-looking” statements and information, within the meaning of
Section 27A of the Securities Act of 1933, Section 21E of the
Securities Exchange Act of 1934, and the safe harbor provisions of
the U.S. Private Securities Litigation Reform Act of 1995 that
relate to our current expectations and views of future events.
Forward-looking statements involve the Company’s current
expectations and projections relating to its financial condition,
competitive position, future financial results, plans, objectives,
and business. All statements other than statements of historical
facts contained in this press release are forward-looking
statements. In some cases, these forward-looking statements can be
identified by words or phrases such as “may,” “will,” “expect,”
“should,” “could,” “anticipate,” “aim,” “estimate,” “intend,”
“plan,” “believe,” “potential,” “continue,” “is/are likely to” or
the negative of these terms or other similar expressions. These
forward-looking statements are subject to risks, uncertainties and
assumptions, some of which are beyond our control. In addition,
these forward-looking statements reflect the Company’s current
views with respect to future events and the Company’s performance
and are not a guarantee of future performance. Actual outcomes may
differ materially from the information contained in the
forward-looking statements as a result of a number of factors,
including, without limitation expectations regarding the Company’s
strategies and future financial performance, including its future
business plans or objectives, prospective performance and
opportunities and competitors, revenues, products and services,
pricing, operating expenses, market trends, liquidity, cash flows
and uses of cash, capital expenditures; the Company’s history of
losses and lack of profitability; the Company’s reliance on third
party contract manufacturing; the rate of innovation required to
maintain competitiveness in the markets in which the Company
competes; the competitiveness of the market in which the Company
competes; the ability for the Company to obtain, maintain, protect
and enforce the Company’s intellectual property rights; the
concentration of the Company’s revenues on a single solution; the
Company’s ability to timely design, produce and launch its
solutions, the Company’s ability to invest in growth initiatives
and pursue acquisition opportunities; the limited liquidity and
trading of the Company’s securities; geopolitical risk and changes
in applicable laws or regulations; the possibility that the Company
may be adversely affected by other economic, business, and/or
competitive factors; operational risk; risk that the COVID-19
pandemic, including variants, vaccine roll-out efforts, and local,
state, and federal responses to addressing the pandemic may have an
adverse effect on the Company’s business operations, as well as the
Company’s financial condition and results of operations; litigation
and regulatory enforcement risks, including the diversion of
management time and attention and the additional costs and demands
on resources; and the risk factors set forth under the caption
“Risk Factors” in our prospectus, filed with the Securities and
Exchange Commission (the “SEC”) on September 3, 2021, and in our
other documents filed with or furnished to the SEC.
These statements reflect management’s current expectations
regarding future events and operating performance and speak only as
of the date of this press release. You should not put undue
reliance on any forward-looking statements. Although we believe
that the expectations reflected in the forward-looking statements
are reasonable, we cannot guarantee that future results, levels of
activity, performance and events and circumstances reflected in the
forward-looking statements will be achieved or will occur. Except
as required by law, we undertake no obligation to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise, after the date on which
the statements are made or to reflect the occurrence of
unanticipated events.
EVOLV TECHNOLOGY
CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except share
and per share data)
(Unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31
2021
2020
2021
2020
Revenue:
Product revenue
$
3,618
$
857
$
13,917
$
1,279
Subscription revenue
2,737
894
7,855
2,637
Service revenue
491
284
1,920
869
Total revenue
6,846
2,035
23,692
4,785
Cost of revenue:
Product revenue
5,234
816
12,471
1,177
Subscription revenue
1,102
632
3,644
1,824
Service revenue
204
119
936
495
Total cost of revenue
6,540
1,567
17,051
3,496
Gross profit
306
468
6,641
1,289
Operating expenses:
Research and development
3,086
5,081
11,416
15,710
Sales and marketing
10,120
2,260
27,404
7,365
General and administrative
8,851
2,434
20,013
5,110
Loss from impairment of leased
equipment
213
-
1,869
-
Total operating expenses
22,270
9,775
60,702
28,185
Loss from operations
(21,964)
(9,307)
(54,061)
(26,896)
Interest and other expense
(55)
(223)
(6,712)
(430)
Loss on extinguishment of debt
-
(66)
(12,685)
(66)
Change in fair value of derivative
liability
-
-
(1,745)
-
Change in fair value of contingent
earn-out liability
14,394
-
46,212
-
Change in fair value of contingently
issuable common stock liability
688
-
6,406
-
Change in fair value of public warrant
liability
9,454
-
12,606
-
Change in fair value of common stock
warrant liability
-
-
(879)
-
Total other income (expense)
$
24,481
$
(289)
$
43,203
$
(496)
Net income (loss) and comprehensive income
(loss) attributable to common stockholders – basic and diluted
$
2,517
$
(9,596)
$
(10,858)
$
(27,392)
Net income (loss) per share – basic and
diluted
$
0.02
$
(1.06)
$
(0.15)
$
(3.07)
Weighted average ordinary shares
outstanding – basic
142,403,779
9,044,968
71,662,694
8,932,404
Weighted average ordinary shares
outstanding – diluted
161,906,393
9,044,968
71,662,694
8,932,404
EVOLV TECHNOLOGY
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
and per share data)
(Unaudited)
December 31,
2021
December 31,
2020
Assets
Current assets:
Cash
$
307,492
$
4,704
Restricted Cash
400
-
Accounts receivable, net
6,477
1,401
Inventory
5,140
2,742
Prepaid expenses and other current
assets
14,151
1,462
Total current assets
333,660
10,309
Commission asset, noncurrent
3,719
1,730
Property and equipment, net
21,592
9,316
Restricted cash, noncurrent
275
-
Other long-term assets
3,819
-
Total assets
$
363,065
$
21,355
Liabilities and Shareholders’ Equity
(Deficit)
Current liabilities:
Accounts payable
$
6,363
$
4,437
Accrued expenses and other current
liabilities
9,183
3,727
Current portion of deferred revenue
6,690
3,717
Current portion of long-term debt
2,000
-
Other current liabilities
135
238
Total current liabilities
24,371
12,119
Deferred revenue, noncurrent
2,475
480
Noncurrent portion of deferred rent
333
-
Common stock warrant liability
-
1
Public warrant liability
11,030
-
Derivative liability
-
1,000
Contingent earn-out liability
20,809
-
Contingently issuable common stock
liability
5,264
-
Financing obligation, noncurrent
-
132
Long-term debt, noncurrent
7,945
16,432
Total liabilities
72,227
30,164
Convertible preferred stock and
shareholders’ equity
Convertible preferred stock
-
75,877
Common stock
14
1
Additional paid-in capital
395,563
9,194
Accumulated deficit
(104,739
)
(93,881
)
Total shareholders’ equity (deficit)
290,838
(84,686
)
Total liabilities and shareholders’
equity
$
363,065
$
21,355
EVOLV TECHNOLOGY
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In thousands)
(Unaudited)
Twelve Months Ended December
31,
2021
2021
Cash flows from operating
activities:
Net loss
$
(10,858
)
$
(27,392
)
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
2,895
1,065
Write-off of inventory
2,041
-
Loss from impairment of leased
equipment
1,869
-
Loss on disposal of fixed assets
617
-
Stock-based compensation
8,511
662
Noncash interest expense
5,245
25
Provision recorded for allowance for
doubtful accounts
(13
)
47
Loss on extinguishment of debt
12,685
66
Change in fair value of derivative
liability
1,745
-
Change in fair value of common stock
warrant liability
879
-
Change in fair value of earn-out
liability
(46,212
)
-
Change in fair value of contingently
issuable common stock
(6,406
)
-
Change in fair value of public warrant
liability
(12,606
)
-
Changes in operating assets and
liabilities
(29,673
)
2,273
Net cash used in operating activities
(69,281
)
(23,254
)
Cash flows from investing
activities:
Purchases of property and equipment
(4,057
)
(6,609
)
Development of internal-use software
(1,028
)
-
Net cash used in investing activities
(5,085
)
(6,609
)
Cash flows from financing
activities:
Proceeds from issuance of Series B-1
convertible preferred stock, net of issuance costs
-
2,994
Proceeds from exercise of stock
options
915
442
Proceeds from issuance of common stock
from the PIPE Investment
300,000
-
Proceeds from the closing of the
Merger
84,945
-
Payment of offering costs from the closing
of the Merger and PIPE Investment
(34,132
)
-
Repayment of financing obligations
(359
)
(244
)
Proceeds from long-term debt, net of
issuance costs
31,882
22,438
Repayment of principal on long term
debt
(5,422
)
(8,404
)
Net cash provided by financing
activities
377,829
17,226
Net increase (decrease) in Cash, cash
equivalents and restricted cash
303,463
(12,637
)
Cash, cash equivalents and restricted
cash, beginning of period
4,704
17,341
Cash, cash equivalents and restricted
cash, end of period
$
308,167
$
4,704
Supplemental disclosure of cash flow
information:
Cash paid for interest
$
860
$
405
EVOLV TECHNOLOGY
RECONCILIATION OF 2022 NET
LOSS TO ADJUSTED EBITDA
(In thousands)
(Unaudited)
Twelve Months Ended December
31, 2022
High
Low
Net income (loss)
$ (83,000)
$ (85,000)
Adjustments to reconcile net income (loss)
to Adjusted EBITDA:
Depreciation and amortization
6,000
6,000
Stock-based compensation
11,000
11,000
Other expense
1,000
1,000
Adjusted EBITDA
$ (65,000)
$ (67,000)
EVOLV TECHNOLOGY
SUMMARY OF KEY OPERATING
STATISTICS
(Unaudited)
($ in thousands)
December 31, 2020
March 31, 2021
June 30, 2021
September 30, 2021
December 31, 2021
New customers
6
13
21
23
27
Total contract value of orders booked
$
5,956
$
8,424
$
10,476
$
16,995
$
17,916
Annual recurring revenue
$
4,034
$
5,424
$
7,423
$
9,932
$
12,907
Remaining performance obligation
$
13,381
$
17,658
$
24,930
$
34,152
$
40,160
Contract value for units in backlog
n/a
n/a
n/a
n/a
$
10,599
Net additions
32
64
113
176
136
Ending deployed units
214
278
391
567
703
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220311005475/en/
Investor Relations: Brian Norris Vice President of
Investor Relations bnorris@evolvtechnology.com
Public Relations: Fitz Barth Director of Communications
fbarth@evolvtechnology.com
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