2023 Year-over-Year Quarterly and First Half
Revenue Increased to $68.8 Million and to $118.9 Million,
Respectively
Gross Profit of $25.9 million, or 37.6% of
Revenues
Tigo Energy, Inc. ("Tigo", or the "Company"), a
leading provider of intelligent solar and energy storage solutions,
today reported unaudited financial results for the second quarter
ended June 30, 2023 and financial guidance for the third quarter
ending September 30, 2023.
Second Quarter 2023 Financial and Operational
Highlights
- Record revenue of $68.8 million, up 290% compared to $17.6
million in the second quarter of 2022.
- Record gross profit of $25.9 million, up 368% compared to $5.5
million in the second quarter of 2022, with gross profit margin
improving to 37.6% from 31.4% in the second quarter of 2022.
- Net loss of $22.2 million, compared to net income of $0.2
million in the second quarter of 2022. Net loss includes the
mark-to-market impact of $38.3 million related to the conversion
feature of the convertible note, partially offset by a discrete tax
benefit of $10.9 million in the quarter.
- Adjusted EBITDA totaled $13.6 million for the second quarter
2023, compared to adjusted EBITDA of $0.8 million in the second
quarter of 2022.
- Closed business combination agreement with Roth CH Acquisition
IV Co. (“Roth CH IV”) on May 23, 2023.
- Announced licensing agreement with GoodWe Technologies Co.,
Ltd. (“GoodWe Technologies”) to deploy Tigo Module-Level Rapid
Shutdown Technology in the GoodWe Rapid Shutdown Device.
Management Commentary
“Tigo achieved a record-setting financial quarter with a number
of significant accomplishments, including reaching the highest
revenue and gross profit in Tigo’s history and completing a
successful closing of our business combination as announced in
May,” said Zvi Alon, Chairman and CEO of Tigo. “We drove record
quarterly revenue of $68.8 million and quarterly adjusted EBITDA of
$13.6 million, and our 2023 first half revenues of $118.9 million
exceeded all of 2022 revenues. Notably, we saw sequential revenue
growth of 37% in the EMEA region and 59% in the Americas. In
addition, our EI solution represented 8% of our revenues during the
quarter as it continues to gain market acceptance. We recently
introduced this offering to the German market and plan to introduce
it in additional geographies in the coming quarters.
“We recently started seeing some demand softening in the channel
as supply constraints that defined 2022 began to improve in 2023.
We believe these supply constraints led to some across-the-board
over-ordering that the industry is now facing. However, end market
demand remains strong and we have seen a significant increase in
installations, which give us confidence that the current market
environment is temporary and our overall growth strategy remains
intact. Over the longer term, we remain confident that the market
is realizing the value of our technology’s open architecture, easy
installation, and powerful software position, and that we can
continue to outgrow the market.”
Second Quarter 2023 Financial Results
Results compare the 2023 fiscal second quarter ended June 30,
2023 to the 2022 fiscal second quarter ended June 30, 2022, unless
otherwise indicated.
- Revenue for the second quarter 2023 totaled $68.8 million, a
290% increase from $17.6 million in the prior year period.
- Gross profit for the second quarter 2023 totaled $25.9 million,
or 37.6% of total revenue, a 368% increase from $5.5 million, or
31.4% of total revenue, in the prior year period.
- Total operating expenses for the second quarter 2023 totaled
$17.2 million, a 250% increase from $4.9 million in the prior year
period. The increase was primarily due to the impact of M&A
transaction costs of $4.1 million and higher headcount to support
the Company’s growth initiatives.
- Net loss for the second quarter 2023 totaled $22.2 million,
compared to net income of $0.2 million for the prior year period.
Net loss includes the mark-to-market impact of $38.3 million
related to the conversion feature of the convertible note,
partially offset by a discrete tax benefit of $10.9 million in the
quarter.
- Adjusted EBITDA totaled $13.6 million for the second quarter
2023, compared to adjusted EBITDA of $0.8 million for the prior
year period.
- Cash, cash equivalents, and marketable securities totaled $62.0
million at June 30, 2023.
Third Quarter 2023 Outlook
The Company also provides guidance for the third quarter ending
September 30, 2023 as follows:
- Revenues are expected to be within the range of $41 million to
$45 million.
- Adjusted EBITDA is expected to be within the range of $1
million to $3 million.
Actual results may differ materially from the Company’s guidance
as a result of, among other things, the factors described below
under “Forward-Looking Statements”.
Conference Call
Tigo management will hold a conference call today, August 8,
2023, at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) to discuss
these results. Company CEO Zvi Alon and CFO Bill Roeschlein will
host the call, followed by a question-and-answer period.
Registration Link: Click here to register
Please register online at least 10 minutes prior to the start
time. If you have any difficulty with registration or connecting to
the conference call, please contact Gateway Group at (949)
574-3860.
The conference call will be broadcast live and available for
replay here and via the Investor Relations section of Tigo’s
website.
About Tigo Energy, Inc.
Founded in 2007, Tigo is a worldwide leader in the development
and manufacture of smart hardware and software solutions that
enhance safety, increase energy yield, and lower operating costs of
residential, commercial, and utility-scale solar systems. Tigo
combines its Flex MLPE (Module Level Power Electronics) and solar
optimizer technology with intelligent, cloud-based software
capabilities for advanced energy monitoring and control. Tigo MLPE
products maximize performance, enable real-time energy monitoring,
and provide code-required rapid shutdown at the module level. The
Company also develops and manufactures products such as inverters
and battery storage systems for the residential solar-plus-storage
market. For more information, please visit www.tigoenergy.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. Such statements include, but are not limited to, statements
about future financial and operating results, our plans,
objectives, expectations and intentions with respect to future
operations, products and services; and other statements identified
by words such as “will likely result,” “are expected to,” “will
continue,” “is anticipated,” “estimated,” “believe,” “intend,”
“plan,” “projection,” “outlook” or words of similar meaning. These
forward-looking statements are based upon the current beliefs and
expectations of Tigo’s 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 anticipated in these
forward-looking statements.
In addition to factors previously disclosed, or that will be
disclosed in, our reports filed with the SEC, factors which may
cause actual results to differ materially from current expectations
include, but are not limited to, our ability to effectively develop
and sell our product offerings and services, our ability to compete
in the highly-competitive and evolving solar industry; our ability
to manage risks associated with seasonal trends and the cyclical
nature of the solar industry; whether we continue to grow our
customer base; whether we continue to develop new products and
innovations to meet constantly evolving customer demands; our
ability to acquire or make investments in other businesses,
patents, technologies, products or services to grow the business
and realize the anticipated benefits therefrom; our ability to meet
future liquidity requirements; our ability to respond to
fluctuations in foreign currency exchange rates and political
unrest and regulatory changes in international markets into which
we expand or otherwise operate in; our failure to attract, hire
retain and train highly qualified personnel in the future; and if
we are unable to maintain key strategic relationships with our
partners and distributors.
Actual results, performance or achievements may differ
materially, and potentially adversely, from any projections and
forward-looking statements and the assumptions on which those
forward-looking statements are based. There can be no assurance
that the forward-looking statements contained herein are reflective
of future performance to any degree. You are cautioned not to place
undue reliance on forward-looking statements as a predictor of
future performance as projected financial information and other
information are based on estimates and assumptions that are
inherently subject to various significant risks, uncertainties and
other factors, many of which are beyond our control. All
information set forth herein speaks only as of the date hereof, and
we disclaim any intention or obligation to update any
forward-looking statements as a result of new information, future
developments or otherwise occurring after the date of this
communication.
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are
prepared and presented in accordance with GAAP, we use the
following non-GAAP financial measure: Adjusted EBITDA. The
presentation of this financial measure is not intended to be
considered in isolation or as a substitute for, or superior to, the
financial information prepared and presented in accordance with
GAAP.
We use Adjusted EBITDA for financial and operational
decision-making and as a means to evaluate period-to-period
comparisons. We define Adjusted EBITDA, a non-GAAP financial
measure, as earnings (loss) before interest expense, income tax
expense (benefit), depreciation and amortization, as adjusted to
exclude stock-based compensation and merger transaction related
expenses. We believe that Adjusted EBITDA provides helpful
supplemental information regarding our performance by excluding
certain items that may not be indicative of our recurring core
business operating results. We believe that both management and
investors benefit from referring to Adjusted EBITDA in assessing
our performance and when planning, forecasting, and analyzing
future periods. Adjusted EBITDA also facilitates management’s
internal comparisons to our historical performance and comparisons
to our competitors’ operating results. We believe Adjusted EBITDA
is useful to investors both because it (i) allows for greater
transparency with respect to key metrics used by management in its
financial and operational decision-making and (ii) is used by our
institutional investors and the analyst community to help them
analyze the health of our business.
The items excluded from Adjusted EBITDA may have a material
impact on our financial results. Certain of those items are
non-recurring, while others are non-cash in nature. Accordingly,
Adjusted EBITDA is presented as supplemental disclosure and should
not be considered in isolation of, as a substitute for, or superior
to, the financial information prepared in accordance with GAAP.
There are a number of limitations related to the use of non-GAAP
financial measures. We compensate for these limitations by
providing specific information regarding the GAAP amounts excluded
from these non-GAAP financial measures and evaluating these
non-GAAP financial measures together with their relevant financial
measures in accordance with GAAP.
We refer investors to the reconciliation Adjusted EBITDA to net
income (loss) included below. A reconciliation for Adjusted EBITDA
provided as guidance is not provided because, as a forward-looking
statement, such reconciliation is not available without
unreasonable effort due to the high variability, complexity, and
difficulty of estimating certain items such as charges to
stock-based compensation expense and currency fluctuations which
could have an impact on our consolidated results.
Tigo Energy, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(in thousands)
June 30, 2023
December 31, 2022
(Unaudited)
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
11,725
$
36,194
Restricted cash
—
1,523
Marketable securities
43,909
—
Accounts receivable, net
45,820
15,816
Inventory, net
50,639
24,915
Deferred issuance costs
—
2,221
Notes receivable
—
456
Prepaid expenses and other current
assets
3,782
3,967
Total current assets
155,875
85,092
Property and equipment, net
2,837
1,652
Operating right-of-use assets
2,810
1,252
Marketable securities
6,335
—
Intangible assets, net
2,327
—
Deferred tax assets
11,147
—
Other assets
722
82
Goodwill
13,079
—
Total assets
$
195,132
$
88,078
LIABILITIES, CONVERTIBLE
PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable
$
54,120
$
23,286
Accrued expenses and other current
liabilities
10,332
4,382
Deferred revenue, current portion
436
950
Warranty liability, current portion
493
392
Operating lease liabilities, current
portion
1,135
578
Current maturities of long-term debt
—
10,000
Total current liabilities
66,516
39,588
Warranty liability, net of current
portion
5,000
3,959
Deferred revenue, net of current
portion
186
172
Long-term debt, net of current maturities
and unamortized debt issuance costs
27,084
10,642
Operating lease liabilities, net of
current portion
1,804
762
Preferred stock warrant liability
—
1,507
Convertible note derivative liability
61,776
—
Other long-term liabilities
2,332
—
Total liabilities
164,698
56,630
Convertible preferred stock
—
87,140
Stockholders’ equity (deficit):
Common stock
6
1
Additional paid-in capital
120,671
6,522
Accumulated deficit
(90,062
)
(62,215
)
Accumulated other comprehensive income
(181
)
—
Total stockholders’ equity (deficit)
30,434
(55,692
)
Total liabilities, convertible preferred
stock and stockholders’ equity (deficit)
$
195,132
$
88,078
Tigo Energy, Inc. and
Subsidiaries
Condensed Consolidated
Statement of Income
(in thousands)
(unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Revenue, net
$
68,826
$
17,639
$
118,884
$
27,558
Cost of revenue
42,920
12,107
74,609
19,343
Gross profit
25,906
5,532
44,275
8,215
Operating expenses:
Research and development
2,424
1,419
4,638
2,855
Sales and marketing
5,163
2,272
9,935
4,341
General and administrative
9,654
1,231
13,217
1,981
Total operating expenses
17,241
4,922
27,790
9,177
Income (loss) from operations
8,665
610
16,485
(962
)
Other expenses (income):
Change in fair value of preferred stock
warrant and contingent shares liability
2,608
8
3,120
8
Change in fair value of derivative
liability
38,251
—
38,251
—
Loss on debt extinguishment
—
—
171
3,613
Interest expense
1,587
400
2,365
849
Other (income) expense, net
(672
)
24
(1,223
)
87
Total other expenses, net
41,774
432
42,684
4,557
(Loss) income before income tax
expense
(33,109
)
178
(26,199
)
(5,519
)
Income tax benefit
(10,933
)
—
(10,933
)
—
Net (loss) income
(22,176
)
178
(15,266
)
(5,519
)
Dividends on Series D and Series E
convertible preferred stock
(1,248
)
(1,350
)
(3,399
)
(2,140
)
Net loss attributable to common
stockholders
$
(23,424
)
$
(1,172
)
$
(18,665
)
$
(7,659
)
Loss per common share
Basic
$
(0.84
)
$
(0.24
)
$
(1.09
)
$
(1.59
)
Diluted
$
(0.84
)
$
(0.24
)
$
(1.09
)
$
(1.59
)
Weighted-average common shares
outstanding
Basic
27,750,374
4,836,316
17,174,936
4,824,468
Diluted
27,750,374
4,836,316
17,174,936
4,824,468
Tigo Energy, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows
(in thousands)
(unaudited)
Six Months Ended June
30,
2023
2022
Cash Flows from Operating
activities:
Net loss
$
(15,266
)
$
(5,519
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
536
226
Reserve for inventory obsolescence
410
—
Change in fair value of preferred stock
warrant and contingent shares liability
3,120
8
Change in fair value of derivative
liability
38,251
—
Deferred income taxes
(11,147
)
—
Non-cash interest expense
982
150
Stock-based compensation
863
52
Allowance for credit losses
170
58
Loss on debt extinguishment
171
3,613
Non-cash lease expense
415
—
Accretion of interest on marketable
securities
(204
)
—
Changes in operating assets and
liabilities:
Accounts receivable
(30,057
)
(5,100
)
Inventory
(26,134
)
323
Prepaid expenses and other assets
167
(1,017
)
Accounts payable
30,254
(77
)
Accrued expenses and other liabilities
2,267
743
Deferred revenue
(500
)
(10
)
Warranty liability
1,142
269
Deferred rent
—
(135
)
Operating lease liabilities
(374
)
—
Net cash used in operating activities
$
(4,934
)
$
(6,416
)
Investing activities:
Purchase of marketable securities
(50,221
)
—
Acquisition of fSight
(16
)
—
Purchase of intangible assets
(450
)
—
Purchase of property and equipment
(1,510
)
(308
)
Disposals of property and equipment
73
—
Net cash used in investing activities
$
(52,124
)
$
(308
)
Financing activities:
Proceeds from Convertible Promissory
Note
50,000
—
(Repayment of) proceeds from Series 2022-1
Notes
(20,833
)
25,000
Repayment of Senior Bonds
—
(10,000
)
Payment of financing costs
(354
)
(3,483
)
Proceeds from sale of Series E convertible
preferred stock
—
21,845
Proceeds from Business Combination
2,238
—
Proceeds from exercise of stock
options
106
23
Payment of tax withholdings on stock
options
(91
)
—
Net cash provided by financing
activities
$
31,066
$
33,385
Net (decrease) increase in cash and
restricted cash
(25,992
)
26,661
Cash, cash equivalents, and restricted
cash at beginning of period
37,717
7,474
Cash, cash equivalents, and restricted
cash at end of period
$
11,725
$
34,135
Tigo Energy, Inc. and
Subsidiaries
Non-GAAP Financial
Measures
(in thousands)
(unaudited)
Reconciliation of Net (Loss)
Income (GAAP) to Adjusted EBITDA (Non-GAAP)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Net (loss) income
$
(22,176
)
$
178
$
(15,266
)
$
(5,519
)
Adjustments:
Total other expenses, net
41,774
432
42,684
4,557
Income tax benefit
(10,933
)
—
(10,933
)
—
Depreciation and amortization
294
114
536
226
Stock-based compensation
497
26
863
52
M&A transaction expenses
4,113
—
4,246
—
Adjusted EBITDA
$
13,568
$
750
$
22,130
$
(684
)
We encourage investors and others to review our financial
information in its entirety and not to rely on any single financial
measure.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230808826579/en/
Investor Relations Contacts Matt Glover or Tom Colton
Gateway Group, Inc. (949) 574-3860 TYGO@gateway-grp.com
Tigo Energy (NASDAQ:TYGO)
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