— Company Regains Compliance with SEC Reporting
and NASDAQ Listing Requirements —
— Company Achieves Positive Adjusted EBITDA1 in
Q4'24 —
- Q4'24 Revenue of $29.1 million, up 41%
year-over-year
- Q4'24 Ending ARR2 of $99.4 million, up 39%
year-over-year
- Q4'24 Adjusted EBITDA of $0.4 million
- Q4'24 Ending RPO3 of $266.7 million
Evolv Technologies Holdings, Inc (NASDAQ: EVLV), a leading
security technology company pioneering AI-based solutions designed
to help create safer experiences, today announced financial results
for the quarter and year ended December 31, 2024 and the filing of
its 2024 Annual Report on Form 10-K with the U.S. Securities and
Exchange Commission ("SEC"). The Company concurrently filed with
the SEC its Quarterly Report on Form 10-Q for the quarter ended
September 30, 2024, and restated financial results for the periods
from the second quarter of 2022 through the second quarter of 2024.
The restatements correct inaccurate accounting for certain sales
transactions that led to premature or incorrectly recognized
revenue. The errors resulted in premature or incorrect recognition
of approximately $3.1 million of revenue on a net basis from the
second quarter of 2022 through the second quarter of 2024
(considering revenue prematurely recognized but offset by amounts
appropriately recognized in subsequent periods).
“Completing this restatement—which brings the Company back into
full compliance with SEC reporting and Nasdaq listing
requirements—marks an important milestone in our ongoing work to
rebuild stakeholder confidence,” said John Kedzierski, President
and Chief Executive Officer of Evolv Technology, Inc. “Looking
ahead, we are focused on prioritizing disciplined execution,
transparent communication, and an unwavering commitment to
best-in-class compliance. With both the restatement and the FTC
resolution now firmly behind us and having achieved our
long-standing profitability goals six months ahead of schedule, we
believe we are well-positioned as we enter our next phase of
growth. We are poised to lead the transformation of the security
technology landscape—making the world a safer place where people
can live, work, learn, and play.”
Total revenue for the third quarter of 2024 was $27.4 million,
an increase of 37% compared to $20.0 million (as restated) for the
third quarter of 2023. Annual Recurring Revenue (“ARR”)2 was $93.7
million at the end of third quarter of 2024, an increase of 46%
compared to $64.4 million (as restated) at the end of the third
quarter of 2023. Net loss for the third quarter of 2024 was $(30.4)
million, or $(0.19) per basic and diluted share, compared to net
income of $5.0 million (as restated), or $0.03 (as restated) per
basic and diluted share, in the third quarter of 2023. Adjusted
earnings (loss)1 for the third quarter of 2024 was $(6.9) million,
or $(0.04) per diluted share, compared to adjusted earnings (loss)1
of $(12.4) million (as restated), or $(0.08) per diluted share, for
the third quarter of 2023. Adjusted EBITDA1 for the third quarter
of 2024 was $(3.0) million compared to $(11.6) million (as
restated) in the third quarter of 2023. As of September 30, 2024,
the Company had cash, cash equivalents, marketable securities, and
restricted cash of $56.3 million and no debt.
Total revenue for the nine months ended September 30, 2024 was
$74.8 million, an increase of 27% compared to $59.0 million (as
restated) for the nine months ended September 30, 2023. Net loss
for the nine months ended September 30, 2024 was $(38.3) million,
or $(0.25) per basic and diluted share, compared to $(90.9) million
(as restated), or $(0.61) (as restated) per basic and diluted
share, in the nine months ended September 30, 2023. Adjusted
earnings (loss)1 for the nine months ended September 30, 2024 was
$(30.8) million, or $(0.20) per diluted share, compared to adjusted
earnings (loss)1 of $(44.2) million (as restated), or $(0.30) (as
restated) per diluted share, for the nine months ended September
30, 2023. Adjusted EBITDA1 for the nine months ended September 30,
2024 was $(21.3) million compared to $(41.6) million (as restated)
in the nine months ended September 30, 2023.
Results for the Fourth Quarter of 2024
Total revenue for the fourth quarter of 2024 was $29.1 million,
an increase of 41% compared to $20.6 million (as restated) for the
fourth quarter of 2023. Annual Recurring Revenue (“ARR”)2 was $99.4
million at the end of fourth quarter of 2024, an increase of 39%
compared to $71.3 million (as restated) at the end of the fourth
quarter of 2023. Net loss for the fourth quarter of 2024 was
$(15.7) million, or $(0.10) per basic and diluted share, compared
to net loss of $(17.2) million (as restated), or $(0.11) per basic
and diluted share, in the fourth quarter of 2023. Adjusted earnings
(loss)1 for the fourth quarter of 2024 was $(4.4) million, or
$(0.03) per diluted share, compared to adjusted earnings (loss)1 of
$(11.8) million (as restated), or $(0.08) (as restated) per diluted
share, for the fourth quarter of 2023. Adjusted EBITDA1 for the
fourth quarter of 2024 was $0.4 million compared to $(10.3) million
(as restated) in the fourth quarter of 2023. As of December 31,
2024, the Company had cash, cash equivalents, marketable
securities, and restricted cash of $51.9 million and no debt.
Remaining Performance Obligation3 as of December 31, 2024 was
$266.7 million. The Company had approximately 6,100 units deployed
as of December 31, 2024, reflecting a one time adjustment to remove
approximately (100) non-revenue generating units from the Company's
deployed unit count related to Evolv Edge, the Company's first
generation product offering.
Total revenue for the twelve months ended December 31, 2024 was
$103.9 million, an increase of 31% compared to $79.6 million (as
restated) for the twelve months ended December 31, 2023. Net loss
for the twelve months ended December 31, 2024 was $(54.0) million,
or $(0.34) per basic and diluted share, compared to $(108.0)
million (as restated), or $(0.72) (as restated) per basic and
diluted share, in the twelve months ended December 31, 2023.
Adjusted earnings (loss)1 for the twelve months ended December 31,
2024 was $(35.3) million, or $(0.23) per diluted share, compared to
adjusted earnings (loss)1 of $(56.0) million (as restated), or
$(0.38) (as restated) per diluted share, for the twelve months
ended December 31, 2023. Adjusted EBITDA1 for the twelve months
ended December 31, 2024 was $(21.0) million compared to $(51.8)
million (as restated) in the twelve months ended December 31,
2023.
The following table summarizes the breakdown of recurring and
non-recurring revenue4 for each period presented:
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
% Change
2024
2023
% Change
(Restated)
(Restated)
Recurring revenue
$
23,678
$
17,074
39
%
$
87,419
$
50,915
72
%
Non-recurring revenue
5,422
3,506
55
%
16,446
28,650
(43
)%
Total revenue
$
29,100
$
20,580
41
%
$
103,865
$
79,565
31
%
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
% Change
2024
2023
% Change
(Restated)
(Restated)
Recurring revenue
$
23,764
$
13,907
71
%
$
63,741
$
33,841
88
%
Non-recurring revenue
3,596
6,054
(41
)%
11,024
25,144
(56
)%
Total revenue
$
27,360
$
19,961
37
%
$
74,765
$
58,985
27
%
The following table summarizes operating cash flows for each
period presented:
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
(Restated)
(Restated)
Net loss
$
(15,720
)
$
(17,198
)
$
(54,017
)
$
(108,048
)
Non-cash expense
6,870
7,461
22,504
59,199
Changes in operating assets and
liabilities
12,054
6,594
660
39,048
Net cash used in operating activities
$
3,204
$
(3,143
)
$
(30,853
)
$
(9,801
)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
(Restated)
(Restated)
Net loss
$
(30,443
)
$
5,046
$
(38,297
)
$
(90,850
)
Non-cash expense
26,306
(16,055
)
15,634
51,738
Changes in operating assets and
liabilities
7,812
13,106
(11,394
)
32,454
Net cash used in operating activities
$
3,675
$
2,097
$
(34,057
)
$
(6,658
)
About Evolv Technology
Evolv Technologies Holdings, Inc (NASDAQ: EVLV) is designed to
transform human security to make a safer, faster, and better
experience for the world’s most iconic venues and companies as well
as schools, hospitals, and public spaces, using industry leading
artificial intelligence (AI)-powered screening and analytics. Its
mission is to transform security to create a safer world to live,
work, learn, and play. Evolv has digitally transformed the gateways
in many places where people gather by enabling seamless integration
combined with powerful analytics and insights. Evolv’s advanced
systems have scanned more than two billion people since 2019. Evolv
has been awarded the U.S. Department of Homeland Security (DHS)
SAFETY Act Designation as a Qualified Anti-Terrorism Technology
(QATT) as well as the Security Industry Association (SIA) 2024 New
Products and Solutions (NPS) Award in the Law Enforcement/Public
Safety/Guarding Systems category, as well as Sport Business
Journal’s (SBJ) 2024 awards for “Best In Fan Experience Technology”
and “Best In Sports Technology”. Evolv®, Evolv Express®, Evolv
Insights®, Evolv Visual Gun Detection™, Evolv eXpedite™, and Evolv
Eva™ are registered trademarks or trademarks of Evolv Technologies,
Inc. in the United States and other jurisdictions. For more
information, visit evolv.com.
1 Non-GAAP Financial Measures In this press release, the
Company’s adjusted gross profit (loss), adjusted gross margin,
adjusted operating expenses, adjusted operating income (loss),
adjusted EBITDA, adjusted earnings (loss), and adjusted earnings
per diluted share 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 operating expenses is defined as operating expenses less
stock-based compensation expense, loss on impairment of lease
equipment, one-time employee separation costs, and one-time legal
and regulatory costs, which management believes provides a more
meaningful representation of on-going operating expense levels. One
time legal and regulatory costs include one-time legal, accounting
and professional fees related to the internal investigation,
subsequent restatement, certain one-time regulatory, litigation and
legal matters, as well as fees related to the resolution of the
U.S. Federal Trade Commission investigation. Adjusted gross profit
and adjusted gross margin exclude stock-based compensation expense,
amortization of capitalized stock-based compensation, losses from
impairment of intangible assets, one-time employee separation
costs, and one-time inventory charges, which management believes
provides a more meaningful representation of contribution margin.
Adjusted operating loss is defined as operating loss, excluding
stock-based compensation expense, amortization of capitalized
stock-based compensation, losses from impairment of lease equipment
and intangible assets, one-time employee separation costs, one-time
inventory charges, and one-time legal and regulatory expenses,
which management believes provides a more meaningful representation
of operating results. Adjusted EBITDA is defined as net income
(loss) plus depreciation and amortization, stock-based
compensation, interest expense (income), provision for income
taxes, loss on extinguishment of debt, change in fair value of
contingent earn-out liability, change in fair value of contingently
issuable common stock liability, change in fair value of public
warrant liability, loss on impairment of lease equipment and
intangible assets, one-time employee separation costs, one-time
inventory charges, and one-time legal and regulatory expenses.
Adjusted earnings (loss) is defined as net income (loss) plus
stock-based compensation, amortization of capitalized stock-based
compensation, loss on extinguishment of debt, change in fair value
of contingent earn-out liability, change in fair value of
contingently issuable common stock liability, change in fair value
of public warrant liability, loss on impairment of lease equipment
and intangible assets, one-time employee separation costs, one-time
inventory charges, and one-time legal and regulatory expenses.
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 operating 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 included in this press
release. The Company is unable to provide a reconciliation of
Adjusted Gross Margin to GAAP Gross Margin and Adjusted EBITDA to
Net Income (Loss), each measure's most directly comparable GAAP
financial measure, on a forward-looking basis without unreasonable
effort, because items that impact these GAAP financial measures are
not within the Company’s control and/or cannot be reasonably
predicted. These items may include, but are not limited to,
predicting forward-looking share-based compensation, changes in the
fair value of derivative liabilities, changes in the fair value of
contingent earn out liabilities, changes in the fair value of
contingently issuable common stock liabilities and changes in fair
value of public warrant liabilities. Such information may have a
significant, and potentially unpredictable, impact on the Company’s
future financial results.
2 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.
3 We define Remaining Performance Obligation, or RPO, as
estimated revenues expected to be recognized in the future related
to performance obligations that are unsatisfied or partially
satisfied as of the end of the quarter.
4 Recurring revenue includes the recurring portion of
revenue associated with pure subscription contracts and hardware
purchase subscription contracts. Non-recurring revenue
includes revenue that is one-time in nature, such as product
revenue, shipping revenue, and revenue from installation, training,
and professional services.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. We intend such forward-looking statements to be covered by
the safe harbor provisions for forward-looking statements contained
in Section 27A of the Securities Act of 1933, as amended and
Section 21E of the Securities Exchange Act of 1934, as amended. All
statements contained in this press release and related presentation
materials other than statements of historical facts, including
without limitation statements regarding our strategy, commitments,
and future financial and operational results. Words such as
“believe” “may,” “will,” “expect,” “should,” “could,” “anticipate,”
“aim,” “estimate,” “intend,” “plan,” “believe,” “potential,”
“continue,” “project,” “plan,” “target,” “forecast”, “is/are likely
to” or the negative of these terms or other similar expressions are
intended to identify forward-looking statements, though not all
forward-looking statements use these words or expressions. The
forward-looking statements in this press release and related
presentation materials are only predictions. We have based these
forward-looking statements largely on our current expectations and
projections about future events and financial trends that we
believe may affect our business, financial condition and results of
operations. Forward-looking statements involve known and unknown
risks, uncertainties and other important factors that may cause our
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements, including,
but not limited to, the following: relating to our history of
losses and ability to reach profitability; our reliance on reseller
partners to generate a growing portion of our revenue; 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 reliance on third party contract
manufacturing and distribution, and a global supply chain; the
Company recognizes a substantial portion of its revenue ratably
over the term of its agreements, and, as a result, downturns or
upturns in sales may not be immediately reflected in its operating
results; 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
failure of our products to detect threats could result in injury or
loss of life, which could harm our brand, reputation, and results
of operations; the loss of designation of our Evolv Express® system
as a Qualified Anti-Terrorism Technology under the Homeland
Security SAFETY Act; risks related to our business model, which is
predicated, in part, on building a customer base that will generate
a recurring stream of revenues through the sale of our subscription
contracts; the ability for the Company to obtain, maintain, protect
and enforce the Company’s intellectual property rights and use of
“open source” software; 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; risks
related to existing and changing tax laws; 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; risks related to
material weaknesses in our internal control over financial
reporting and our remediation plans; risks related to increasing
attention to and evolving expectations for, environmental, social,
and governance initiatives; the impact of fluctuating general
economic and market conditions and reductions in spending; the need
for additional capital to support business growth, which might not
be available on acceptable terms, if at all; and litigation and
regulatory enforcement risks, including the diversion of management
time and attention and the additional costs and demands on
resources. These and other important factors discussed under the
caption “Risk Factors” in our Annual Report on Form 10-K for the
year ended December 31, 2024 filed with the Securities and Exchange
Commission ("SEC") on April 28, 2025, could cause actual results to
differ materially from those indicated by the forward-looking
statements made in this press release. The forward-looking
statements in this press release and related presentation materials
are based upon information available to us as of the date hereof,
and while we believe such information forms a reasonable basis for
such statements, it may be limited or incomplete, and our
statements should not be read to indicate that we have conducted an
exhaustive inquiry into, or review of, all potentially available
relevant information. These statements are inherently uncertain and
investors are cautioned not to unduly rely upon these
statements.
You should review this press release and the documents that we
reference in this press release and related presentation materials
with the understanding that our actual future results, levels of
activity, performance and achievements may be materially different
from what we expect. We qualify all of our forward-looking
statements by these cautionary statements. Except as required by
applicable law, we do not plan to publicly update or revise any
forward-looking statements contained in this press release and
related presentation materials, whether as a result of any new
information, future events or otherwise.
EVOLV TECHNOLOGY
CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except share
and per share data)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
(Restated)
(Restated)
Revenue:
Product revenue
$
1,675
$
1,848
$
6,464
$
22,768
Subscription revenue
17,263
12,468
65,046
36,201
Service revenue
6,564
4,856
23,467
15,606
License fee and other revenue
3,598
1,408
8,888
4,990
Total revenue
29,100
20,580
103,865
79,565
Cost of revenue:
Cost of product revenue
2,166
4,692
10,735
27,967
Cost of subscription revenue
8,604
4,984
27,846
14,760
Cost of service revenue
1,476
1,166
5,399
3,982
Cost of license fee and other revenue
113
177
597
949
Total cost of revenue
12,359
11,019
44,577
47,658
Gross profit
16,741
9,561
59,288
31,907
Operating expenses:
Research and development
5,390
6,303
23,446
24,473
Sales and marketing
13,455
14,344
61,291
54,986
General and administrative
16,759
11,128
56,634
42,182
Loss from impairment of property and
equipment
15
—
224
322
Total operating expenses
35,619
31,775
141,595
121,963
Loss from operations
(18,878
)
(22,214
)
(82,307
)
(90,056
)
Other income (expense), net:
Interest expense
—
—
—
(654
)
Interest income
548
1,630
2,942
6,227
Other expense, net
(50
)
(17
)
(83
)
(84
)
Loss on extinguishment of debt
—
—
—
(626
)
Change in fair value of contingent
earn-out liability
1,218
2,452
16,310
(14,901
)
Change in fair value of contingently
issuable common stock liability
311
422
2,529
(3,138
)
Change in fair value of public warrant
liability
1,131
580
6,592
(4,765
)
Total other income (expense), net
3,158
5,067
28,290
(17,941
)
Loss before income taxes
(15,720
)
(17,147
)
(54,017
)
(107,997
)
Provision for income taxes
—
(51
)
$
—
$
(51
)
Net loss
$
(15,720
)
$
(17,198
)
$
(54,017
)
$
(108,048
)
Net income (loss) attributable to common
stockholders – basic and diluted
$
(15,720
)
$
(17,198
)
$
(54,017
)
$
(108,048
)
Weighted average common shares
outstanding
Basic
158,997,410
151,087,430
156,573,886
149,168,105
Diluted
158,997,410
151,087,430
156,573,886
149,168,105
Net loss per share
Basic
$
(0.10
)
$
(0.11
)
$
(0.34
)
$
(0.72
)
Diluted
$
(0.10
)
$
(0.11
)
$
(0.34
)
$
(0.72
)
Weighted average common shares outstanding
– basic and diluted
158,997,410
151,087,430
156,573,886
149,168,105
Net loss per share - basic and diluted
$
(0.10
)
$
(0.11
)
$
(0.34
)
$
(0.72
)
Net loss
$
(15,720
)
$
(17,198
)
$
(54,017
)
$
(108,048
)
Other comprehensive income (loss)
Cumulative translation adjustment
96
(44
)
21
(43
)
Total other comprehensive income
(loss)
96
(44
)
21
(43
)
Total comprehensive loss
$
(15,624
)
$
(17,242
)
$
(53,996
)
$
(108,091
)
EVOLV TECHNOLOGY
CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
and per share data)
December 31, 2024
December 31, 2023
(Restated)
Assets
Current assets:
Cash and cash equivalents
$
37,015
$
67,162
Restricted cash
—
275
Marketable securities
14,927
51,289
Accounts receivable, net
28,392
21,547
Inventory
16,963
10,344
Current portion of contract assets
799
1,397
Current portion of commission asset
5,429
4,387
Prepaid expenses and other current
assets
17,921
16,957
Total current assets
121,446
173,358
Contract assets, noncurrent
657
964
Commission asset, noncurrent
7,567
7,249
Property and equipment, net
123,661
113,161
Operating lease right-of-use assets
13,993
1,195
Other assets
735
1,202
Total assets
$
268,059
$
297,129
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
10,492
$
17,400
Accrued expenses and other current
liabilities
19,508
15,703
Current portion of deferred revenue
64,506
46,808
Current portion of operating lease
liabilities
2,203
1,391
Total current liabilities
96,709
81,302
Deferred revenue, noncurrent
20,266
25,149
Operating lease liabilities,
noncurrent
12,326
—
Contingent earn-out liability
12,809
29,119
Contingently issuable common stock
liability
4,001
6,530
Public warrant liability
4,297
10,889
Total liabilities
150,408
152,989
Stockholders’ equity:
Preferred stock, $0.0001 par value;
100,000,000 authorized at December 31, 2024 and December 31, 2023;
no shares issued and outstanding at December 31, 2024 and December
31, 2023
—
—
Common stock, $0.0001 par value;
1,100,000,000 shares authorized at December 31, 2024 and December
31, 2023; 159,602,069 and 151,310,080 shares issued and outstanding
at December 31, 2024 and December 31, 2023, respectively
16
15
Additional paid-in capital
472,331
444,825
Accumulated other comprehensive loss
(32
)
(53
)
Accumulated deficit
(354,664
)
(300,647
)
Stockholders’ equity
117,651
144,140
Total liabilities and stockholders’
equity
$
268,059
$
297,129
EVOLV TECHNOLOGY
CONSOLIDATED STATEMENTS OF CASH FLOWS (In
thousands)
Twelve Months Ended
December 31,
2024
2023
(Restated)
Cash flows from operating
activities:
Net loss
$
(54,017
)
$
(108,048
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
17,375
9,702
Write-off of inventory and change in
inventory reserve
2,578
1,309
Loss from impairment of property and
equipment
224
322
Loss from impairment of intangible
asset
983
—
Stock-based compensation
24,756
24,129
Non-cash interest expense
—
22
Amortization (accretion) of premium
(discount) on marketable securities, net of change in accrued
interest
447
(575
)
Non-cash lease expense
1,420
478
Change in allowance for expected credit
losses
152
382
Loss on extinguishment of debt
—
626
Change in fair value of earn-out
liability
(16,310
)
14,901
Change in fair value of contingently
issuable common stock
(2,529
)
3,138
Change in fair value of public warrant
liability
(6,592
)
4,765
Changes in operating assets and
liabilities
Accounts receivable
(6,997
)
4,510
Inventory
(7,852
)
960
Commission assets
(1,360
)
(2,779
)
Contract assets
905
1,383
Other assets
467
633
Prepaid expenses and other current
assets
(964
)
(2,426
)
Accounts payable
192
(5,963
)
Deferred revenue
12,815
39,488
Accrued expenses and other current
liabilities
4,534
3,857
Operating lease liability
(1,080
)
(615
)
Net cash used in operating activities
(30,853
)
(9,801
)
Cash flows from investing
activities:
Development of internal-use software
(6,125
)
(3,535
)
Purchases of property and equipment
(31,189
)
(69,134
)
Proceeds from sale of property and
equipment
—
270
Purchases of marketable securities
(29,367
)
(89,898
)
Proceeds from maturities of marketable
securities
65,282
39,184
Net cash provided by (used in) investing
activities
(1,399
)
(123,113
)
Cash flows from financing
activities:
Proceeds from exercise of stock
options
1,809
668
Proceeds from long-term debt
—
1,876
Repayment of principal on long-term
debt
—
(31,876
)
Payment of debt issuance costs and
prepayment penalty
—
(332
)
Net cash provided by (used in) financing
activities
1,809
(29,664
)
Effect of exchange rate changes on cash
and cash equivalents
21
(43
)
Net decrease in cash, cash equivalents and
restricted cash
(30,422
)
(162,621
)
Cash, cash equivalents and restricted
cash
Cash, cash equivalents and restricted cash
at beginning of period
67,437
230,058
Cash, cash equivalents and restricted cash
at end of period
$
37,015
$
67,437
EVOLV TECHNOLOGY
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(In thousands, except share
and per share data)
(Unaudited
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
(Restated)
(Restated)
Revenue:
Product revenue
$
1,344
$
3,456
$
4,789
$
20,920
Subscription revenue
17,909
9,858
47,783
23,733
Service revenue
6,085
4,345
16,903
10,750
License fee and other revenue
2,022
2,302
5,290
3,582
Total revenue
27,360
19,961
74,765
58,985
Cost of revenue:
Cost of product revenue
2,616
3,496
8,569
23,275
Cost of subscription revenue
7,348
4,157
19,242
9,776
Cost of service revenue
1,404
1,219
3,923
2,816
Cost of license fee and other revenue
183
198
484
772
Total cost of revenue
11,551
9,070
32,218
36,639
Gross profit
15,809
10,891
42,547
22,346
Operating expenses:
Research and development
5,810
6,386
18,056
18,170
Sales and marketing
14,966
14,408
47,836
40,642
General and administrative
13,976
11,261
39,875
31,054
Loss from impairment of property and
equipment
209
28
209
322
Total operating expenses
34,961
32,083
105,976
90,188
Loss from operations
(19,152
)
(21,192
)
(63,429
)
(67,842
)
Other income (expense), net:
Interest expense
—
—
—
(654
)
Interest income
628
1,791
2,394
4,597
Other income (expense), net
34
(64
)
(33
)
(67
)
Loss on extinguishment of debt
—
—
—
(626
)
Change in fair value of contingent
earn-out liability
(8,321
)
14,078
15,092
(17,353
)
Change in fair value of contingently
issuable common stock liability
(2,056
)
2,277
2,218
(3,560
)
Change in fair value of public warrant
liability
(1,576
)
8,156
5,461
(5,345
)
Total other (expense) income, net
(11,291
)
26,238
25,132
(23,008
)
Net (loss) income
$
(30,443
)
$
5,046
$
(38,297
)
$
(90,850
)
Net (loss) income attributable to common
stockholders – basic and diluted
$
(30,443
)
$
4,983
$
(38,297
)
$
(90,850
)
Weighted average common shares
outstanding
Basic
157,709,229
150,206,893
155,760,149
148,521,299
Diluted
157,709,229
173,976,375
155,760,149
148,521,299
Net (loss) income per share
Basic
$
(0.19
)
$
0.03
$
(0.25
)
$
(0.61
)
Diluted
$
(0.19
)
$
0.03
$
(0.25
)
$
(0.61
)
Net (loss) income
$
(30,443
)
$
5,046
$
(38,297
)
$
(90,850
)
Other comprehensive (loss) income
Cumulative translation adjustment
(86
)
34
(75
)
1
Total other comprehensive (loss)
income
(86
)
34
(75
)
1
Total comprehensive (loss) income
$
(30,529
)
$
5,080
$
(38,372
)
$
(90,849
)
EVOLV TECHNOLOGY
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
and per share data)
(Unaudited)
September 30, 2024
December 31, 2023
(Restated)
Assets
Current assets:
Cash and cash equivalents
$
46,033
$
67,162
Restricted cash
275
275
Marketable securities
9,960
51,289
Accounts receivable, net
34,855
21,547
Inventory
16,276
10,344
Current portion of contract assets
696
1,397
Current portion of commission asset
5,256
4,387
Prepaid expenses and other current
assets
21,050
16,957
Total current assets
134,401
173,358
Contract assets, noncurrent
672
964
Commission asset, noncurrent
7,385
7,249
Property and equipment, net
120,842
113,161
Operating lease right-of-use assets
14,297
1,195
Other assets
869
1,202
Total assets
$
278,466
$
297,129
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
8,619
$
17,400
Accrued expenses and other current
liabilities
17,016
15,703
Current portion of deferred revenue
61,649
46,808
Current portion of operating lease
liabilities
2,191
1,391
Total current liabilities
89,475
81,302
Deferred revenue, noncurrent
23,867
25,149
Operating lease liabilities,
noncurrent
12,372
—
Contingent earn-out liability
14,027
29,119
Contingently issuable common stock
liability
4,312
6,530
Public warrant liability
5,428
10,889
Total liabilities
149,481
152,989
Stockholders’ equity:
Preferred stock, $0.0001 par value;
100,000,000 authorized at September 30, 2024 and December 31, 2023;
no shares issued and outstanding at September 30, 2024 and December
31, 2023
—
—
Common stock, $0.0001 par value;
1,100,000,000 shares authorized at September 30, 2024 and December
31, 2023; 158,288,746 and 151,310,080 shares issued and outstanding
at September 30, 2024 and December 31, 2023, respectively
16
15
Additional paid-in capital
468,041
444,825
Accumulated other comprehensive loss
(128
)
(53
)
Accumulated deficit
(338,944
)
(300,647
)
Stockholders’ equity
128,985
144,140
Total liabilities and stockholders’
equity
$
278,466
$
297,129
EVOLV TECHNOLOGY
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Nine Months Ended
September 30,
2024
2023
(Restated)
Cash flows from operating
activities:
Net loss
$
(38,297
)
$
(90,850
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
11,933
6,570
Write-off of inventory and change in
inventory reserve
3,151
278
Loss from impairment of property and
equipment
209
322
Stock-based compensation
21,364
17,771
Non-cash interest expense
—
22
Amortization (accretion) of premium
(discount) on marketable securities, net of change in accrued
interest
261
(482
)
Non-cash lease expense
1,116
136
Change in allowance for expected credit
losses
371
237
Loss on extinguishment of debt
—
626
Change in fair value of earn-out
liability
(15,092
)
17,353
Change in fair value of contingently
issuable common stock
(2,218
)
3,560
Change in fair value of public warrant
liability
(5,461
)
5,345
Changes in operating assets and
liabilities
Accounts receivable
(13,679
)
(929
)
Inventory
(8,327
)
4,170
Commission assets
(1,005
)
(2,102
)
Contract assets
993
(85
)
Other assets
333
352
Prepaid expenses and other current
assets
(4,093
)
(1,973
)
Accounts payable
216
(6,396
)
Deferred revenue
13,559
39,357
Accrued expenses and other current
liabilities
1,655
278
Operating lease liability
(1,046
)
(218
)
Net cash used in operating activities
(34,057
)
(6,658
)
Cash flows from investing
activities:
Development of internal-use software
(4,773
)
(2,202
)
Purchases of property and equipment
(24,443
)
(51,646
)
Proceeds from sale of property and
equipment
—
60
Purchases of marketable securities
(14,567
)
(58,652
)
Proceeds from maturities of marketable
securities
55,635
19,647
Net cash provided by (used in) investing
activities
11,852
(92,793
)
Cash flows from financing
activities:
Proceeds from exercise of stock
options
1,151
616
Proceeds from long-term debt
—
1,876
Repayment of principal on long-term
debt
—
(31,876
)
Payment of debt issuance costs and
prepayment penalty
—
(332
)
Net cash provided by (used in) financing
activities
1,151
(29,716
)
Effect of exchange rate changes on cash
and cash equivalents
(75
)
1
Net decrease in cash, cash equivalents and
restricted cash
(21,129
)
(129,166
)
Cash, cash equivalents and restricted
cash
Cash, cash equivalents and restricted cash
at beginning of period
67,437
230,058
Cash, cash equivalents and restricted cash
at end of period
$
46,308
$
100,892
EVOLV TECHNOLOGY
SUMMARY OF KEY OPERATING
STATISTICS
(Unaudited)
Three Months Ended or as
of,
($ in thousands)
March 31, 2024
June 30, 2024
September 30,
2024
December 31,
2024
New customers
53
84
52
60
Annual recurring revenue
$
79,192
$
87,011
$
93,676
$
99,351
Recurring revenue
$
18,961
$
21,016
$
23,764
$
23,678
Total net units shipped*
375
447
468
458
*Net Units Shipped reflects total units
shipped (excluding rental units, upgrade units, etc.) less units
churned.
EVOLV TECHNOLOGY
RECONCILIATION OF GAAP
OPERATING EXPENSES TO ADJUSTED OPERATING EXPENSES
(In thousands)
(Unaudited)
Three Months Ended,
March 31, 2023
June 30, 2023
September 30,
2023
December 31,
2023
March 31, 2024
June 30, 2024
September 30,
2024
December 31,
2024
(Restated)
(Restated)
(Restated)
(Restated)
(Restated)
(Restated)
Operating expenses, GAAP
$
27,098
$
31,007
$
32,083
$
31,775
$
34,061
$
36,954
$
34,961
$
35,619
Stock-based compensation
(4,888
)
(6,518
)
(5,922
)
(6,218
)
(6,292
)
(7,254
)
(7,263
)
(3,159
)
Loss on impairment of lease equipment
(137
)
(157
)
(28
)
—
—
—
(209
)
(15
)
One-time employee separation costs
—
(282
)
(61
)
(262
)
—
(826
)
—
(2,059
)
Other one-time legal and regulatory
costs
(53
)
(401
)
(884
)
(273
)
(476
)
(2,185
)
(2,339
)
(7,285
)
Adjusted operating expenses
$
22,020
$
23,649
$
25,188
$
25,022
$
27,293
$
26,689
$
25,150
$
23,101
EVOLV TECHNOLOGY
RECONCILIATION OF GAAP GROSS
PROFIT TO ADJUSTED GROSS PROFIT, GAAP GROSS MARGIN TO ADJUSTED
GROSS MARGIN AND GAAP OPERATING INCOME (LOSS) TO ADJUSTED OPERATING
INCOME (LOSS)
(In thousands)
(Unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
(Restated)
(Restated)
Revenue
$
29,100
$
20,580
$
103,865
$
79,565
Cost of revenue
12,359
11,019
44,577
47,658
Gross profit, GAAP
16,741
9,561
59,288
31,907
Stock-based compensation
233
140
788
583
Amortization of capitalized stock-based
compensation
85
14
137
47
Loss from impairment of intangible
asset
983
—
983
—
One-time employee separation costs
—
—
174
—
One-time inventory charges
123
1,925
2,729
1,925
Adjusted gross profit
$
18,165
$
11,640
$
64,100
$
34,462
Gross margin %
57.5
%
46.5
%
57.1
%
40.1
%
Adjusted gross margin %
62.4
%
56.6
%
61.7
%
43.3
%
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
(Restated)
(Restated)
Revenue
$
27,360
$
19,961
$
74,765
$
58,985
Cost of revenue
11,551
9,070
32,218
36,639
Gross profit, GAAP
15,809
10,891
42,547
22,346
Stock-based compensation
244
114
555
443
Amortization of capitalized stock-based
compensation
23
12
52
33
One-time employee separation costs
—
—
174
—
One-time inventory charges
1,471
—
2,607
—
Adjusted gross profit
$
17,547
$
11,017
$
45,935
$
22,822
Gross margin %
57.8
%
54.6
%
56.9
%
37.9
%
Adjusted gross margin %
64.1
%
55.2
%
61.4
%
38.7
%
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
(Restated)
(Restated)
Operating loss, GAAP
$
(18,878
)
$
(22,214
)
$
(82,307
)
$
(90,056
)
Stock-based compensation
3,392
6,358
24,756
24,129
Amortization of capitalized stock-based
compensation
85
14
137
47
Loss on impairment of lease equipment
15
—
224
322
Loss from impairment of intangible
asset
983
—
983
—
One-time employee separation costs
2,060
262
3,060
605
One-time inventory charges
123
1,925
2,729
1,925
Other one-time legal and regulatory
costs
7,284
273
12,285
1,611
Adjusted operating loss
$
(4,936
)
$
(13,382
)
$
(38,133
)
$
(61,417
)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
(Restated)
(Restated)
Operating loss, GAAP
$
(19,152
)
$
(21,192
)
$
(63,429
)
$
(67,842
)
Stock-based compensation
7,507
6,036
21,364
17,771
Amortization of capitalized stock-based
compensation
23
12
52
33
Loss on impairment of lease equipment
209
28
209
322
One-time employee separation costs
—
61
1,000
343
One-time inventory charges
1,471
—
2,607
—
Other one-time legal and regulatory
costs
2,339
884
5,000
1,338
Adjusted operating loss
$
(7,603
)
$
(14,171
)
$
(33,197
)
$
(48,035
)
EVOLV TECHNOLOGY
RECONCILIATION OF GAAP NET
INCOME (LOSS) TO ADJUSTED EBITDA
(In thousands)
(Unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
(Restated)
(Restated)
Net loss
$
(15,720
)
$
(17,198
)
$
(54,017
)
$
(108,048
)
Depreciation & amortization
5,442
3,132
17,375
9,702
Stock-based compensation
3,392
6,358
24,756
24,129
Interest expense (income)
(548
)
(1,630
)
(2,942
)
(5,573
)
Provision for income taxes
—
51
—
51
Loss on extinguishment of debt
—
—
—
626
Change in fair value of contingent
earn-out liability
(1,218
)
(2,452
)
(16,310
)
14,901
Change in fair value of contingently
issuable common stock liability
(311
)
(422
)
(2,529
)
3,138
Change in fair value of public warrant
liability
(1,131
)
(580
)
(6,592
)
4,765
Loss on impairment of lease equipment
15
—
224
322
Loss from impairment of intangible
asset
983
—
983
—
One-time employee separation costs
2,060
262
3,060
605
One-time inventory charges
123
1,925
2,729
1,925
Other one-time legal and regulatory
costs
7,284
273
12,285
1,611
Adjusted EBITDA
$
371
$
(10,281
)
$
(20,978
)
$
(51,846
)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
(Restated)
(Restated)
Net (loss) income
$
(30,443
)
$
5,046
$
(38,297
)
$
(90,850
)
Depreciation & amortization
4,575
2,620
11,933
6,570
Stock-based compensation
7,507
6,036
21,364
17,771
Interest expense (income)
(628
)
(1,791
)
(2,394
)
(3,943
)
Loss on extinguishment of debt
—
—
—
626
Change in fair value of contingent
earn-out liability
8,321
(14,078
)
(15,092
)
17,353
Change in fair value of contingently
issuable common stock liability
2,056
(2,277
)
(2,218
)
3,560
Change in fair value of public warrant
liability
1,576
(8,156
)
(5,461
)
5,345
Loss on impairment of lease equipment
209
28
209
322
One-time employee separation costs
—
61
1,000
343
One-time inventory charges
1,471
—
2,607
—
Other one-time legal and regulatory
costs
2,339
884
5,000
1,338
Adjusted EBITDA
$
(3,017
)
$
(11,627
)
$
(21,349
)
$
(41,565
)
EVOLV TECHNOLOGY
RECONCILIATION OF GAAP NET
INCOME (LOSS) TO ADJUSTED EARNINGS (LOSS)
(In thousands, except share
and per share data)
(Unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2024
2023
2024
2023
(Restated)
(Restated)
Net loss
$
(15,720
)
$
(17,198
)
$
(54,017
)
$
(108,048
)
Stock-based compensation
3,392
6,358
24,756
24,129
Amortization of capitalized stock-based
compensation
85
14
137
47
Loss on extinguishment of debt
—
—
—
626
Change in fair value of contingent
earn-out liability
(1,218
)
(2,452
)
(16,310
)
14,901
Change in fair value of contingently
issuable common stock liability
(311
)
(422
)
(2,529
)
3,138
Change in fair value of public warrant
liability
(1,131
)
(580
)
(6,592
)
4,765
Loss on impairment of lease equipment
15
—
224
322
Loss from impairment of intangible
asset
983
—
983
—
One-time employee separation costs
2,060
262
3,060
605
One-time inventory charges
123
1,925
2,729
1,925
Other one-time legal and regulatory
costs
7,284
273
12,285
1,611
Adjusted loss
$
(4,438
)
$
(11,820
)
$
(35,274
)
$
(55,979
)
Weighted average common shares outstanding
– diluted
158,997,410
151,087,430
156,573,886
149,168,105
Adjusted loss per share – diluted
$
(0.03
)
$
(0.08
)
$
(0.23
)
$
(0.38
)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
(Restated)
(Restated)
Net (loss) income
$
(30,443
)
$
5,046
$
(38,297
)
$
(90,850
)
Stock-based compensation
7,507
6,036
21,364
17,771
Amortization of capitalized stock-based
compensation
23
12
52
33
Loss on extinguishment of debt
—
—
—
626
Change in fair value of contingent
earn-out liability
8,321
(14,078
)
(15,092
)
17,353
Change in fair value of contingently
issuable common stock liability
2,056
(2,277
)
(2,218
)
3,560
Change in fair value of public warrant
liability
1,576
(8,156
)
(5,461
)
5,345
Loss on impairment of lease equipment
209
28
209
322
One-time employee separation costs
—
61
1,000
343
One-time inventory charges
1,471
—
2,607
—
Other one-time legal and regulatory
costs
2,339
884
5,000
1,338
Adjusted loss
$
(6,941
)
$
(12,444
)
$
(30,836
)
$
(44,159
)
Weighted average common shares outstanding
– diluted
157,709,229
150,206,893
155,760,149
148,521,299
Adjusted loss per share – diluted
$
(0.04
)
$
(0.08
)
$
(0.20
)
$
(0.30
)
*In the consolidated statements of
operations, one-time inventory reserves were recorded in cost of
product revenue and one-time legal and regulatory costs were
recorded in general and administrative expense. Stock-based
compensation, amortization of capitalized stock-based compensation,
and one-time employee termination costs were recorded as follows.
Prior period amounts are being shown for comparative purposes:
Three Months Ended,
March 31, 2023
June 30, 2023
September 30,
2023
December 31,
2023
March 31, 2024
June 30, 2024
September 30,
2024
December 31,
2024
(Restated)
(Restated)
(Restated)
(Restated)
(Restated)
(Restated)
Stock-based compensation:
Cost of product revenue
$
16
$
12
$
—
$
6
$
—
$
5
$
4
$
8
Cost of subscription revenue
52
82
74
82
91
110
169
154
Cost of service revenue
47
61
38
47
44
51
63
61
Cost of license fee and other revenue
31
28
2
5
3
7
8
10
Research and development
843
1,232
1,148
1,079
902
1,222
1,243
1,153
Sales and marketing
1,980
2,536
2,293
2,572
2,959
2,724
2,516
2,747
General and administrative
2,065
2,750
2,481
2,567
2,431
3,308
3,504
(741
)
Total stock-based compensation
$
5,034
$
6,701
$
6,036
$
6,358
$
6,430
$
7,427
$
7,507
$
3,392
Amortization of capitalized stock-based
compensation:
Cost of subscription revenue
5
5
6
8
8
8
13
47
Cost of service revenue
5
6
6
6
6
7
10
38
Total amortization of capitalized
stock-based compensation
$
10
$
11
$
12
$
14
$
14
$
15
$
23
$
85
One-time employee separation costs:
Cost of service revenue
$
—
$
—
$
—
$
—
$
—
$
174
$
—
$
—
Sales and marketing
—
282
61
262
—
794
—
63
General and administrative
—
—
—
—
—
32
—
1,997
Total other one-time expenses
$
—
$
282
$
61
$
262
$
—
$
1,000
$
—
$
2,060
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250428860927/en/
Investor Relations: Brian Norris Senior Vice President of
Finance and Investor Relations bnorris@evolvtechnology.com
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