Impinj, Inc. (NASDAQ: PI), a leading RAIN RFID provider and Internet of Things pioneer, today released its financial results for the first quarter ended March 31, 2024.

“2024 started strong, with revenue and profitability exceeding both our fourth-quarter results and first-quarter guidance,” said Chris Diorio, Impinj co-founder and CEO. “As we continue driving our bold vision to connect every item in our everyday world, I remain confident in our market position and energized by the opportunities ahead.”

First Quarter 2024 Financial Summary

  • Revenue of $76.8 million
  • GAAP gross margin of 48.9%; non-GAAP gross margin of 51.5%
  • GAAP net income of $33.3 million, or income of $1.10 per diluted share using 31.4 million shares
  • Adjusted EBITDA of $6.7 million
  • Non-GAAP net income of $6.2 million, or income of $0.21 per diluted share using 28.8 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.

Second Quarter 2024 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 second quarter of 2024 (in millions, except per share data):

 

 

Three Months Ending

 

 

June 30, 2024(1)

Revenue

 

$96.0 to $99.0

GAAP Net income

$5.9 to $7.4 

Adjusted EBITDA income

 

$23.9 to $25.4

GAAP Weighted-average shares — diluted

 

29.0 to 29.4

GAAP Net income per share — diluted

 

$0.20 to $0.25

Non-GAAP Net income

 

$21.7 to $23.2

Non-GAAP Weighted-average shares — diluted(2)

 

31.7 to 31.9

Non-GAAP Net income per share — diluted(2)

 

$0.72 to $0.77

(1) The outlook for our revenue and related results for the second quarter ended June 30, 2024 includes $15 million related to recognition of an annual license fee for use of our intellectual property. (2) Non-GAAP diluted net income per share includes the impact of our convertible debt using the if-converted method, which assumes full share settlement. Interest expense is added back to net income and weighted average shares includes total shares issuable at conversion of 2.6 million.

A reconciliation between GAAP and non-GAAP financial measures is provided in the "Non-GAAP Financial Measures" section below.

Conference Call Information

Impinj will host a conference call today, April 24, 2024 at 5:00 p.m. ET / 2:00 p.m. PT to discuss its first-quarter 2024 results, as well as its outlook for its second-quarter 2024. Interested parties may access the call by dialing +1-412-317-1863. 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 3992794.

Management’s prepared written remarks, along with quarterly financial data, will be made available on Impinj’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, statements regarding conditions in the markets in which we compete as well as the broader economy, and our financial guidance and considerations for the second quarter of 2024 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)

 

 

March 31, 2024

 

December 31, 2023

Assets:

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

166,852

 

 

$

94,793

 

Short-term investments

 

7,292

 

 

 

18,440

 

Accounts receivable, net

 

59,384

 

 

 

54,919

 

Inventory

 

87,757

 

 

 

97,172

 

Prepaid expenses and other current assets

 

3,120

 

 

 

4,372

 

Total current assets

 

324,405

 

 

 

269,696

 

Property and equipment, net

 

47,451

 

 

 

44,891

 

Intangible assets, net

 

12,207

 

 

 

13,913

 

Operating lease right-of-use assets

 

9,107

 

 

 

9,735

 

Other non-current assets

 

1,370

 

 

 

1,478

 

Goodwill

 

19,343

 

 

 

19,696

 

Total assets

$

413,883

 

 

$

359,409

 

Liabilities and stockholders' equity:

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

9,416

 

 

$

8,661

 

Accrued compensation and employee related benefits

 

8,207

 

 

 

8,519

 

Accrued and other current liabilities

 

11,694

 

 

 

8,614

 

Current portion of operating lease liabilities

 

3,454

 

 

 

3,373

 

Current portion of deferred revenue

 

1,672

 

 

 

1,713

 

Total current liabilities

 

34,443

 

 

 

30,880

 

Long-term debt

 

282,262

 

 

 

281,855

 

Operating lease liabilities, net of current portion

 

8,444

 

 

 

9,360

 

Deferred tax liabilities, net

 

2,574

 

 

 

2,911

 

Deferred revenue, net of current portion

 

237

 

 

 

272

 

Total liabilities

 

327,960

 

 

 

325,278

 

Stockholders' equity:

 

 

 

Common stock, $0.001 par value

 

28

 

 

 

27

 

Additional paid-in capital

 

482,972

 

 

 

463,900

 

Accumulated other comprehensive income (loss)

 

(270

)

 

 

355

 

Accumulated deficit

 

(396,807

)

 

 

(430,151

)

Total stockholders' equity

 

85,923

 

 

 

34,131

 

Total liabilities and stockholders' equity

$

413,883

 

 

$

359,409

 

IMPINJ, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data, unaudited)

 

 

 

Three Months Ended

 

 

March 31,

 

 

2024

 

2023

Revenue

 

$

76,825

 

 

$

85,897

 

Cost of revenue

 

 

39,277

 

 

 

42,367

 

Gross profit

 

 

37,548

 

 

 

43,530

 

Operating expenses:

 

 

 

 

Research and development

 

 

22,519

 

 

 

22,435

 

Sales and marketing

 

 

10,176

 

 

 

9,973

 

General and administrative

 

 

13,365

 

 

 

15,564

 

Amortization of intangibles

 

 

1,409

 

 

 

 

Restructuring costs

 

 

1,812

 

 

 

 

Total operating expenses

 

 

49,281

 

 

 

47,972

 

Income (loss) from operations

 

 

(11,733

)

 

 

(4,442

)

Other income, net

 

 

1,292

 

 

 

1,365

 

Income from settlement of litigation

 

 

45,000

 

 

 

 

Interest expense

 

 

(1,216

)

 

 

(1,209

)

Income (loss) before income taxes

 

 

33,343

 

 

 

(4,286

)

Income tax benefit (expense)

 

 

1

 

 

 

(72

)

Net income (loss) per share attributable to common stockholders:

 

$

33,344

 

 

$

(4,358

)

 

 

 

 

 

Net income (loss) per share — basic

 

$

1.22

 

 

$

(0.17

)

Net income (loss) per share — diluted

 

$

1.10

 

(1

)

$

(0.17

)

 

 

 

 

 

Weighted-average shares outstanding — basic

 

 

27,357

 

 

 

26,285

 

Weighted-average shares outstanding — diluted

 

 

31,425

 

(1

)

 

26,285

 

(1) Diluted net income per share includes the impact of our convertible debt using the if-converted method, which assumes full share settlement. Interest expense is added back to net income and weighted average shares includes total shares issuable at conversion of 2.6 million.

IMPINJ, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands, unaudited)

 

 

 

Three Months Ended

 

 

March 31,

 

 

2024

 

2023

Operating activities:

 

 

 

 

Net income (loss)

 

$

33,344

 

 

$

(4,358

)

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

 

 

 

 

Depreciation and amortization

 

 

3,909

 

 

 

1,793

 

Stock-based compensation

 

 

11,790

 

 

 

10,224

 

Restructuring equity modification expense

 

 

366

 

 

 

 

Accretion of discount or amortization of premium on investments

 

 

(67

)

 

 

(766

)

Amortization of debt issuance costs

 

 

407

 

 

 

400

 

Deferred tax expense

 

 

(278

)

 

 

 

Revaluation of acquisition-related contingent consideration liability

 

 

907

 

 

 

 

Changes in operating assets and liabilities, net of amounts acquired:

 

 

 

 

Accounts receivable

 

 

(4,503

)

 

 

(10,970

)

Inventory

 

 

9,400

 

 

 

(39,412

)

Prepaid expenses and other assets

 

 

1,355

 

 

 

1,389

 

Accounts payable

 

 

1,878

 

 

 

14,650

 

Accrued compensation and employee related benefits

 

 

(292

)

 

 

(2,006

)

Accrued and other liabilities

 

 

2,182

 

 

 

4,472

 

Operating lease right-of-use assets

 

 

614

 

 

 

695

 

Operating lease liabilities

 

 

(820

)

 

 

(891

)

Deferred revenue

 

 

(52

)

 

 

(1,780

)

Net cash provided by (used in) operating activities

 

 

60,140

 

 

 

(26,560

)

Investing activities:

 

 

 

 

Proceeds from sales of investments

 

 

 

 

 

13,372

 

Proceeds from maturities of investments

 

 

11,248

 

 

 

34,136

 

Purchases of property and equipment

 

 

(6,202

)

 

 

(7,582

)

Net cash provided by investing activities

 

 

5,046

 

 

 

39,926

 

Financing activities:

 

 

 

 

Proceeds from exercise of stock options and employee stock purchase plan

 

 

6,917

 

 

 

4,520

 

Net cash provided by financing activities

 

 

6,917

 

 

 

4,520

 

Effect of exchange rate changes on cash and cash equivalents

 

 

(44

)

 

 

 

Net increase in cash and cash equivalents

 

 

72,059

 

 

 

17,886

 

Cash and cash equivalents

 

 

 

 

Beginning of period

 

 

94,793

 

 

 

19,597

 

End of period

 

$

166,852

 

 

$

37,483

 

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 and amortization; restructuring costs; settlement income and related costs; induced conversion expense; other income, net; interest expense; acquisition related expense and related purchase accounting adjustments; and income tax benefit (expense). During the year ended December 31, 2023, we revised our definition of adjusted EBITDA to exclude acquisition related expenses, related purchase accounting adjustments, and amortization of intangibles in connection with our Voyantic Oy acquisition. During the three months ended March 31, 2024, we further revised our definition of adjusted EBITDA to exclude settlement income. We have excluded these items because we do not believe they reflect our core operations and us excluding them enables more consistent evaluation of our operating performance. The revision to our definition of adjusted EBITDA did not impact adjusted EBITDA for any previously reported periods because there was no impact of a similar nature in such prior periods affecting comparability.

Non-GAAP Net Income (Loss)

We define non-GAAP net income as net income (loss), excluding, if applicable for the periods presented, the effects of stock-based compensation; depreciation and amortization; restructuring costs; settlement income and related costs; induced conversion expense; acquisition related expense and related purchase accounting adjustments; and the corresponding income tax impacts of adjustments to net income (loss).

During the year ended December 31, 2023, we revised our definition of non-GAAP net income to adjust for acquisition related expenses, related purchase accounting adjustments, and amortization of intangibles in connection with our Voyantic Oy acquisition. During the three months ended March 31, 2024, we further revised our definition of non-GAAP net income to exclude settlement income. The revisions to our definition of non-GAAP net income did not impact non-GAAP net income for any previously reported periods because there was no impact of a similar nature in such prior periods affecting comparability.

Additionally, during the year ended December 31, 2023, we revised our definition of non-GAAP net income (loss) to adjust for income tax effects of adjustments to net income (loss), calculated at the statutory rate for current and historical periods. We have revised the prior period amounts to conform to our current period presentation.

IMPINJ, INC.

RECONCILIATIONS OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES

(in thousands, except percentages, unaudited)

 

 

 

Three Months Ended

 

 

March 31,

 

 

2024

 

2023

GAAP Gross margin

 

 

48.9

%

 

 

50.7

%

Adjustments:

 

 

 

 

Depreciation and amortization

 

 

2.0

%

 

 

1.2

%

Purchase accounting adjustments

 

 

0.0

%

 

 

0.0

%

Stock-based compensation

 

 

0.6

%

 

 

0.5

%

Non-GAAP Gross margin

 

 

51.5

%

 

 

52.4

%

 

 

 

 

 

GAAP Net income (loss)

 

$

33,344

 

 

$

(4,358

)

Adjustments:

 

 

 

 

Depreciation and amortization

 

 

3,909

 

 

 

1,793

 

Stock-based compensation

 

 

11,790

 

 

 

10,224

 

Restructuring costs

 

 

1,812

 

 

 

 

Acquisition related expenses

 

 

907

 

 

 

1,042

 

Other income, net

 

 

(1,292

)

 

 

(1,365

)

Income from settlement of litigation

 

 

(45,000

)

 

 

 

Interest expense

 

 

1,216

 

 

 

1,209

 

Income tax expense (benefit)

 

 

(1

)

 

 

72

 

Adjusted EBITDA

 

$

6,685

 

 

$

8,617

 

 

 

 

 

 

GAAP Net income (loss)

 

$

33,344

 

 

$

(4,358

)

Adjustments:

 

 

 

 

Depreciation and amortization

 

 

3,909

 

 

 

1,793

 

Stock-based compensation

 

 

11,790

 

 

 

10,224

 

Restructuring costs

 

 

1,812

 

 

 

 

Acquisition transaction expenses

 

 

907

 

 

 

1,042

 

Income from settlement of litigation

 

 

(45,000

)

 

 

 

Income tax effects of adjustments (1)

 

 

(591

)

 

 

(818

)

Non-GAAP Net income

 

$

6,171

 

 

$

7,883

 

 

 

 

 

 

Non-GAAP Net income per share — diluted

 

$

0.21

 

 

$

0.28

 

 

 

 

 

 

GAAP Weighted-average shares — diluted

 

 

31,425

 

 

 

26,285

 

Dilutive shares from stock plans

 

 

 

 

 

2,268

 

Anti-dilutive shares from convertible debt

 

 

(2,589

)

 

 

 

Non-GAAP Weighted-average shares — diluted

 

 

28,836

 

 

 

28,553

 

(1) The tax effects of the adjustments are calculated using the statutory rate, taking into consideration the nature of the item and relevant taxing jurisdictions.

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

 

 

June 30,

 

 

2024

GAAP Net income

 

$

6,668

 

Adjustments:

 

 

Forecasted Depreciation and amortization

 

 

3,159

 

Forecasted Stock-based compensation

 

 

14,865

 

Forecasted Interest expense

 

 

1,258

 

Forecasted Other income, net

 

 

(1,300

)

Forecasted Income tax expense

 

 

(50

)

Adjusted EBITDA

 

$

24,600

 

 

 

 

GAAP Net income

 

$

6,668

 

Adjustments:

 

 

Forecasted Depreciation and amortization

 

 

3,159

 

Forecasted Stock-based compensation

 

 

14,865

 

Forecasted Income tax effects of adjustments

 

 

(2,201

)

Non-GAAP Net income

 

$

22,491

 

 

 

 

GAAP Net income per share — diluted

 

$

0.23

 

Non-GAAP Net income per share — diluted(1)

 

$

0.75

 

 

 

 

GAAP weighted-average shares — diluted

 

 

29,200

 

Dilutive shares from convertible debt

 

 

2,600

 

Non-GAAP weighted-average shares — diluted(1)

 

 

31,800

 

(1) Non-GAAP diluted net income per share includes the impact of our convertible debt using the if-converted method, which assumes full share settlement. Interest expense is added back to net income and weighted average shares includes total shares issuable at conversion of 2.6 million.

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

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