Intevac, Inc. (Nasdaq: IVAC), a leading supplier of thin-film
processing systems, today reported financial results for the fiscal
fourth quarter and year ended December 30, 2023.
Q4 and Fiscal 2023 Highlights
- Successfully completed TRIO™ development program and achieved
qualification of initial TRIO system before year-end 2023.
- Q4 sales of $12.9 million exceeded prior expectations due to
the acceleration of heat-assisted magnetic recording (HAMR)
technology upgrades for our hard disk drive (HDD) customers. Total
revenues of $52.7 million for fiscal 2023 represented very strong
growth of 47% year-over-year.
- Achieved all-time record sales of HDD upgrades – for both the
fiscal third quarter and full year 2023 – in support of the HAMR
technology transition currently underway on our industry-leading
200 Lean® flagship platform.
- Successfully re-negotiated order backlog for two
capacity-adding 200 Lean systems during Q4, in favor of additional
HAMR process module upgrades.
- Ended 2023 with $72.2 million in cash, restricted cash, and
investments, which was slightly below forecast due to delayed
collections from our largest customer.
“We are pleased to announce a strong finish for fiscal 2023,
within both of our primary served markets,” commented Nigel Hunton,
president and chief executive officer. “In our HDD business, during
what was one of the most challenging years in the industry’s
history, we achieved exceptionally strong year-over-year revenue
growth of 47% and approached nearly $53 million of sales, the vast
majority of which was aimed at enabling our customers to achieve
the most significant new technology transition of the industry’s
last 20 years. The initial ramp underway of drives incorporating
heat-assisted magnetic recording (HAMR) technology comes as a
direct result of Intevac’s long history of HDD leadership and
tireless efforts throughout 2023.
“Looking forward, the most important new driver of Intevac’s
future revenue growth is our groundbreaking TRIO platform, and our
first system achieved qualification in the fourth quarter. This is
a key milestone in the growth trajectory of Intevac, as the TRIO
achieved key performance metrics that will enable Intevac to
address an estimated $1 billion served market.
“The achievements of 2023 place Intevac on a solid trajectory
for future growth, with the strength of the balance sheet
maintained,” Mr. Hunton concluded. “We have taken a key step
forward in our plan to diversify and grow our product portfolio and
customer base, and we look forward to achieving greater success and
momentum in each of our end markets in 2024.”
($ Millions, except per share amounts)
Q4 2023
Q4 2022
GAAP Results
Non-GAAP Results
GAAP Results
Non-GAAP Results
Net Revenues
$
12.9
$
12.9
$
11.3
$
11.3
Operating Loss
$
(1.9
)
$
(1.9
)
$
(3.3
)
$
(3.3
)
Net Loss
$
(1.8
)
$
(1.9
)
$
(3.2
)
$
(3.2
)
Net Loss per Share – Basic and Diluted
$
(0.07
)
$
(0.07
)
$
(0.12
)
$
(0.13
)
Year Ended
Year Ended
December 30, 2023
December 31, 2022
GAAP Results
Non-GAAP Results
GAAP Results
Non-GAAP Results
Net Revenues
$
52.7
$
52.7
$
35.8
$
35.8
Operating Loss
$
(13.2
)
$
(11.3
)
$
(16.5
)
$
(13.8
)
Net Loss
$
(12.2
)
$
(10.9
)
$
(17.1
)
$
(14.1
)
Net Loss per Share – Basic and Diluted
$
(0.47
)
$
(0.42
)
$
(0.68
)
$
(0.56
)
Intevac’s non-GAAP adjusted results exclude the impact of the
following, where applicable: (i) restructuring charges, (ii) fixed
asset disposals associated with a restructuring program, (iii)
discontinued operations and (iv) litigation settlements. A
reconciliation of the GAAP and non-GAAP adjusted results is
provided in the financial table included in this release. See also
“Use of Non-GAAP Financial Measures” section.
Fourth Quarter Fiscal 2023 Summary
Revenues were $12.9 million, compared to $11.3 million in the
fourth quarter of 2022, and consisted of HDD upgrades, spares and
service for each period. Gross margin was 46.0%, compared to 44.3%
in the fourth quarter of 2022. Operating expenses were $7.8
million, compared to $8.3 million in the fourth quarter of
2022.
The net loss for the quarter was $1.8 million, or $0.07 per
diluted share, compared to a net loss of $3.2 million, or $0.12 per
diluted share, in the fourth quarter of 2022. The non-GAAP net loss
for the fourth quarter of 2023 was $1.9 million, or $0.07 per
diluted share, compared to the non-GAAP net loss for the fourth
quarter of 2022 of $3.2 million, or $0.13 per diluted share.
Order backlog was $42.4 million on December 30, 2023, compared
to $46.5 million on September 30, 2023 and $121.7 million on
December 31, 2022. Backlog at December 30, 2023 does not include
any 200 Lean HDD systems. Backlog at September 30, 2023 included
two 200 Lean HDD systems. Backlog at December 31, 2022 included
eleven 200 Lean HDD systems.
The Company ended the year with $72.2 million of total cash,
cash equivalents, restricted cash and investments and $114.6
million in tangible book value.
Fiscal Year 2023 Summary
Revenues were $52.7 million, compared to 2022 revenues of $35.8
million, and consisted of one 200 Lean HDD system, one refurbished
200 Lean HDD system, HDD upgrades, spares and service in 2023,
compared to HDD upgrades, spares and service in 2022. Gross margin
was 38.4%, compared to 42.2% in 2022, and operating expenses were
$33.5 million, compared to $31.6 million in 2022. The operating
loss of $13.2 million included $2.0 million of
restructuring-related costs, including severance. The net loss was
$12.2 million, or $0.47 per diluted share, compared to a net loss
of $17.1 million, or $0.68 per diluted share, for fiscal 2022. The
non-GAAP net loss was $10.9 million, or $0.42 per diluted share,
compared to the non-GAAP net loss of $14.1 million, or $0.56 per
diluted share, for fiscal 2022.
Use of Non-GAAP Financial Measures
Intevac’s non-GAAP results exclude the impact, where applicable,
of restructuring charges, fixed asset disposals associated with a
restructuring program, discontinued operations and litigation
settlements. A reconciliation of the GAAP and non-GAAP results is
provided in the financial tables included in this release.
Management uses non-GAAP results to evaluate the Company’s
operating and financial performance in light of business objectives
and for planning purposes. These measures are not in accordance
with GAAP and may differ from non-GAAP methods of accounting and
reporting used by other companies. Intevac believes these measures
enhance investors’ ability to review the Company’s business from
the same perspective as the Company’s management and facilitate
comparisons of this period’s results with prior periods. The
presentation of this additional information should not be
considered a substitute for results prepared in accordance with
GAAP.
Conference Call Information
The Company will discuss its financial results and outlook in a
conference call today at 1:30 p.m. PT (4:30 p.m. ET). To
participate in the teleconference, please call toll-free (877)
407-0989 prior to the start time, and reference meeting number
13743810. For international callers, the dial-in number is +1 (201)
389-0921. You may also listen live via the Internet at
https://www.webcast-eqs.com/intevac020524/en or on the Company's
investor relations website at https://ir.intevac.com/. For those
unable to attend live, an archived webcast of the call will be
available at the same link.
About Intevac
Founded in 1991, we are a leading provider of thin-film process
technology and manufacturing platforms for high-volume
manufacturing environments. As a long-time supplier to the hard
disk drive (HDD) industry, our industry-leading 200 Lean® platform
supports the majority of the world’s capacity for HDD disk media
production, as well as all technology upgrade initiatives currently
underway in support of next-generation HAMR (heat-assisted magnetic
recording) media. With over 30 years of leadership in designing,
developing, and manufacturing high-productivity, thin-film
processing systems, we also are leveraging our technology and
know-how for additional markets with our groundbreaking TRIO™
platform, which enables high-value coatings to be deployed
cost-effectively on an array of glass displays and other
substrates, including for consumer devices.
For more information call 408-986-9888, or visit the Company's
website at www.intevac.com.
200 Lean® is a registered trademark of Intevac, Inc. and TRIO™
is a trademark of Intevac, Inc.
Safe Harbor Statement
This press release includes statements that constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995 (the “Reform Act”).
Intevac claims the protection of the safe-harbor for
forward-looking statements contained in the Reform Act. These
forward-looking statements are often characterized by the terms
“may,” “believes,” “projects,” “expects,” or “anticipates,” and do
not reflect historical facts. Specific forward-looking statements
contained in this press release include, but are not limited to:
the Company’s revenue growth potential and future financial
performance, including preserving the strength of the balance
sheet. The forward-looking statements contained herein involve
risks and uncertainties that could cause actual results to differ
materially from the Company’s expectations. These risks include,
but are not limited to, global macroeconomic conditions and supply
chain challenges including shipment delays, availability of
components, and freight, logistics and other disruptions, and
changes in market dynamics that could change the forecasts and
delivery schedules for both our systems and upgrades, each of which
could have a material impact on our business, our financial
results, and the Company’s stock price. These risks and other
factors are detailed in the Company’s periodic filings with the
U.S. Securities and Exchange Commission.
All forward-looking statements in this press release are based
on information available to the Company as of the date hereof, and
Intevac does not assume any obligation to update the
forward-looking statements provided to reflect events that occur or
circumstances that exist after the date on which they were made,
except as required by law. Any future product, service, feature, or
related specification that may be referenced in this release is for
informational purposes only and is not a commitment to deliver any
offering, technology or enhancement.
INTEVAC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited, in thousands, except percentages and per share
amounts)
Three months ended
Year ended
December 30,
2023
December 31,
2022
December 30,
2023
December 31,
2022
Net revenues
$
12,906
$
11,259
$
52,665
$
35,761
Gross profit
5,938
4,986
20,226
15,086
Gross margin
46.0
%
44.3
%
38.4
%
42.2
%
Operating expenses
Research and development
3,785
3,383
15,125
13,722
Selling, general and administrative
4,063
4,869
18,345
17,876
Total operating expenses
7,848
8,252
33,470
31,598
Operating loss
(1,910
)
(3,266
)
(13,244
)
(16,512
)
Interest income and other income
(expense), net
534
362
2,456
1,085
Loss from continuing operations before
provision for income taxes
(1,376
)
(2,904
)
(10,788
)
(15,427
)
Provision for income taxes
524
335
1,822
1,327
Net loss from continuing operations
(1,900
)
(3,239
)
(12,610
)
(16,754
)
Income (loss) from discontinued
operations, net of tax
55
73
420
(321
)
Net loss
$
(1,845
)
$
(3,166
)
$
(12,190
)
$
(17,075
)
Net income (loss) per share (basic and
diluted)
Continuing operations
$
(0.07
)
$
(0.13
)
$
(0.48
)
$
(0.67
)
Discontinued operations
$
0.00
$
0.00
$
0.02
$
(0.01
)
Net loss
$
(0.07
)
$
(0.12
)
$
(0.47
)
$
(0.68
)
Weighted average common shares
outstanding
Basic and Diluted
26,385
25,457
26,121
25,192
INTEVAC, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except par value)
December 30,
2023
December 31,
2022
(Unaudited)
(see Note)
ASSETS
Current assets
Cash, cash equivalents and short-term
investments
$
68,846
$
94,445
Accounts receivable, net
18,613
15,823
Inventories
43,795
30,003
Prepaid expenses and other current
assets
2,123
1,898
Total current assets
133,377
142,169
Long-term investments
2,687
17,585
Restricted cash
700
786
Property, plant and equipment, net
7,664
3,658
Operating lease right-of-use-assets
7,658
3,390
Intangible assets, net
954
1,090
Deferred income tax and other long-term
assets
3,466
4,381
Total assets
$
156,506
$
173,059
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities
Current operating lease liabilities
$
1,008
$
3,404
Accounts payable
5,800
11,610
Accrued payroll and related
liabilities
3,475
3,087
Other accrued liabilities
1,820
5,430
Contract advances
20,407
2,444
Total current liabilities
32,510
25,975
Non-current liabilities
Non-current operating lease
liabilities
6,976
1,417
Contract advances
1,482
22,215
Other non-current liabilities
21
—
Total non-current liabilities
8,479
23,632
Stockholders’ equity
Common stock ($0.001 par value)
26
26
Additional paid-in capital
210,320
206,355
Treasury stock, at cost
(29,551
)
(29,551
)
Accumulated other comprehensive income
(loss)
97
(193
)
Accumulated deficit
(65,375
)
(53,185
)
Total stockholders’ equity
115,517
123,452
Total liabilities and stockholders’
equity
$
156,506
$
173,059
Note: Amounts as of December 31, 2022 are derived from the
December 31, 2022 audited consolidated financial statements.
INTEVAC, INC.
RECONCILIATION OF GAAP TO NON-GAAP
RESULTS
(Unaudited, in thousands, except per share
amounts)
Three months ended
Year ended
December 30,
2023
December 31,
2022
December 30,
2023
December 31,
2022
Non-GAAP Loss from Operations
Reported operating loss (GAAP basis)
$
(1,910
)
$
(3,266
)
$
(13,244
)
$
(16,512
)
Restructuring charges1
—
—
1,950
1,232
Loss on fixed asset disposals2
—
—
—
1,453
Litigation settlement3
—
12
—
12
Non-GAAP Operating Loss
$
(1,910
)
$
(3,254
)
$
(11,294
)
$
(13,815
)
Non-GAAP Net Loss
Reported net loss (GAAP basis)
$
(1,845
)
$
(3,166
)
$
(12,190
)
$
(17,075
)
Continuing operations:
Restructuring charges1
—
—
1,950
1,232
Loss on fixed asset disposals2
—
—
—
1,453
Litigation settlement3
—
12
—
12
Income tax effect of non-GAAP
adjustments4
—
—
(275
)
—
Discontinued operations5
(55
)
(73
)
(420
)
321
Non-GAAP Net Loss
$
(1,900
)
$
(3,227
)
$
(10,935
)
$
(14,057
)
Non-GAAP Net Loss Per Diluted
Share
Reported net loss per diluted share (GAAP
basis)
$
(0.07
)
$
(0.12
)
$
(0.47
)
$
(0.68
)
Continuing operations:
Restructuring charges1
$
—
$
—
$
0.06
$
0.05
Loss on fixed asset disposals2
$
—
$
—
$
—
$
0.06
Litigation settlement3
$
—
$
0.00
$
—
$
0.00
Discontinued operations:5
$
(0.00
)
$
(0.00
)
$
(0.02
)
$
0.01
Non-GAAP Net Loss Per Diluted Share
$
(0.07
)
$
(0.13
)
$
(0.42
)
$
(0.56
)
Weighted average number of diluted
shares
26,385
25,457
26,121
25,192
1Results for the years ended December 30, 2023 and December 31,
2022 include severance and other employee-related costs related to
restructuring programs.
2The amount represents fixed asset disposals under the 2022
restructuring plan.
3The amount represents incremental charges associated with the
settlement of the Private Attorneys General Act (“PAGA”) lawsuit.
The Company participated in a confidential mediation on February 1,
2022, and reached a settlement resolving the PAGA claim. The
settlement in the amount of $1.0 million was paid on January 20,
2023 and effectively extinguished the lawsuit.
4The amount represents the estimated income tax effect of the
non-GAAP adjustments. The Company calculated the tax effect of
non-GAAP adjustments by applying an applicable estimated
jurisdictional tax rate to each specific non-GAAP item.
5The amount represents discontinued operations of the Photonics
business that was sold on December 30, 2021.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240205594236/en/
Kevin Soulsby Chief Financial Officer (408) 986-9888
Claire McAdams Investor Relations (530) 265-9899
Intevac (NASDAQ:IVAC)
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