Inpixon Reports Second Quarter 2022 Financial Results and Provides Business Update
Inpixon (Nasdaq: INPX) reported robust financial growth for the second quarter of 2022, achieving $4.7 million in revenue, a 37% increase year-over-year, and $10.0 million for the first half, marking a 55% increase. The gross profit was $3.3 million for Q2, with a margin of 70%. Despite revenue growth, the company faced a net loss of $19.9 million for Q2, largely due to increased operating expenses. Inpixon has expanded its customer base, enhanced its organic growth and secured ISO/IEC certification for its enterprise apps. A conference call will discuss these results further.
- Revenue increased by 55% for six months ended June 30, 2022, compared to the prior year.
- Gross profit margin maintained at 72% for six months, up from 2021.
- Increased customer engagement with new enterprise organizations and existing clients.
- Joined SAP's partner program, opening access to 440,000 potential customers.
- Net loss increased to $19.9 million for Q2 due to higher operating expenses.
- Non-GAAP Adjusted EBITDA loss widened to $9.9 million for Q2.
Achieves
Conference Call to be Held Today at 4:30 p.m. Eastern Time
PALO ALTO, Calif., Aug. 15, 2022 /PRNewswire/ -- Inpixon® (Nasdaq: INPX), the Indoor Intelligence® company, today provided a business update and reported financial results for its 2022 second quarter ended June 30, 2022.
"We continued to show growth during the second quarter despite macroeconomic challenges, illustrated by achieving
"We have designed our solutions and technologies to help organizations create and redefine exceptional workplace experiences that enable smarter, safer and more secure environments, while attaining higher levels of productivity, improved worker and employee satisfaction rates, and a more connected workplace. Due to our marketing and sales activities coupled with third-party recognition and awards, we continue to see top-tier organizations implementing our technologies into their organizations. Additionally, our enterprise apps recently received ISO/IEC certification, confirming our information security policies and processes meet stringent industry best practices and standards. As a result, we believe this and our other certifications will allow us to move through customer engagements and sign new contracts more swiftly.
"Furthermore, we recently joined SAP's partner program where we are able to market our smart factory, smart warehouse, and digital supply chain solutions to SAP's 440,000 customers through the SAP store. We believe this partner program will result in increased demand for our solutions, as well as increased exposure around the world.
"Overall, while we are cognizant of the macroeconomic challenges that may continue to lie ahead, we are focused on increasing efficiencies operationally, while also working to ensure that we continue to meet our growth goals," concluded Mr. Ali.
Financial Results
Revenues for the three and six months ended June 30, 2022, were
Net loss attributable to stockholders of Inpixon for the three and six months ended June 30, 2022, was
Non-GAAP Adjusted EBITDA for the three and six months ended June 30, 2022, was a loss of
Proforma non-GAAP net loss per basic and diluted common share for the three and six months ended June 30, 2022, was a loss of
Conference Call
Inpixon management will host a conference call today at 4:30 p.m. Eastern Time to discuss the company's financial results for the second quarter ended June 30, 2022, as well as to review the company's corporate progress and other developments.
The conference call will be available via telephone by dialing toll-free +1 888-506-0062 for U.S. callers or +1 973-528-0011 for international callers and entering access code 618409. A webcast of the call may be accessed at https://www.webcaster4.com/Webcast/Page/2235/46295 or on the company's Investor Relations section of the website, ir.inpixon.com.
Investors and other interested parties are invited to submit questions to management prior to the call's start via email to inpx@crescendo-ir.com.
A webcast replay will be available on the company's Investor Relations section of the website (ir.inpixon.com) through August 15, 2023. A telephone replay of the call will be available approximately one hour following the call, through August 22, 2022, and can be accessed by dialing 877-481-4010 for U.S. callers or +1 919-882-2331 for international callers and entering access code 46295.
About Inpixon
Inpixon® (Nasdaq: INPX) is the innovator of Indoor Intelligence®, delivering actionable insights for people, places and things. Combining the power of mapping, positioning and analytics, Inpixon helps to create smarter, safer, and more secure environments. The company's Indoor Intelligence and mobile app solutions are leveraged by a multitude of industries to optimize operations, increase productivity, and enhance safety. Inpixon customers can take advantage of industry leading location awareness, RTLS, workplace and hybrid event solutions, analytics, sensor fusion, IIoT and the IoT to create exceptional experiences and to do good with indoor data. For the latest insights, follow Inpixon on LinkedIn, Twitter, and visit inpixon.com.
Safe Harbor Statement
All statements in this release that are not based on historical fact are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. While management has based any forward-looking statements included in this release on its current expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties and other factors, many of which are outside of the control of Inpixon and its subsidiaries, which could cause actual results to materially differ from such statements. Such risks, uncertainties, and other factors include, but are not limited to, the fluctuation of economic conditions, the impact of COVID-19, global conflicts, inflation and other global events on Inpixon's results of operations and global supply chain constraints, Inpixon's ability to integrate the products and business from recent acquisitions into its existing business, the performance of management and employees, the regulatory landscape as it relates to privacy regulations and their applicability to Inpixon's technology, Inpixon's ability to maintain compliance with Nasdaq's minimum bid price requirement and other continued listing requirements, the ability to obtain financing if needed, competition, general economic conditions and other factors that are detailed in Inpixon's periodic and current reports available for review at sec.gov. Furthermore, Inpixon operates in a highly competitive and rapidly changing environment where new and unanticipated risks may arise. Accordingly, investors should not place any reliance on forward-looking statements as a prediction of actual results. Inpixon disclaims any intention to, and undertakes no obligation to, update or revise forward-looking statements.
Non-GAAP Financial Measures
Management believes that certain financial measures not in accordance with generally accepted accounting principles in the United States ("GAAP") are useful measures of operations. EBIDTA, Adjusted EBITDA and pro forma net loss per share are non-GAAP measures. Inpixon defines "EBITDA" as net income (loss) before interest, provision for (benefit from) income taxes, and depreciation and amortization. Management uses Adjusted EBITDA as a metric for which it manages the business, and Inpixon defines "Adjusted EBITDA" as EBITDA plus adjustments for other income or expense items, non-recurring items and non-cash items. Inpixon defines "pro forma net loss per share" as GAAP net loss per share adjusted for stock-based compensation, amortization of intangibles and one-time charges including loss on the exchange of debt for equity and provision for valuation allowances.
Management provides Adjusted EBITDA and pro forma net loss per share measures so that investors will have the same financial information that management uses, which may assist investors in assessing Inpixon's performance on a period-over-period basis. Adjusted EBITDA or pro forma net loss per share is not a measure of financial performance under GAAP, and should not be considered an alternative to net income (loss) or any other measure of performance under GAAP, or to cash flows from operating, investing or financing activities as an indicator of cash flows or as a measure of liquidity. Adjusted EBITDA and pro forma net loss per share have limitations as analytical tools and should not be considered either in isolation or as a substitute for analysis of Inpixon's results as reported under GAAP.
For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, please see the "Reconciliation of Non-GAAP Financial Measures" table accompanying this press release.
Inpixon Contacts
General inquiries:
Inpixon
Email: marketing@inpixon.com
Web: inpixon.com/contact-us
Investor relations:
Crescendo Communications, LLC
Tel: +1 212-671-1020
Email: INPX@crescendo-ir.com
INPIXON AND SUBSIDIARIES | ||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(In thousands, except number of shares and par value data) | ||||||
As of | ||||||
June 30, 2022 | December 31, | |||||
(Unaudited) | (Audited) | |||||
ASSETS | ||||||
Current Assets | ||||||
Cash and cash equivalents | $ | 65,755 | $ | 52,480 | ||
Accounts receivable, net of allowances of | 2,767 | 3,218 | ||||
Other receivables | 311 | 321 | ||||
Inventory, net realizable value | 1,581 | 1,976 | ||||
Short-term investments | - | 43,125 | ||||
Note receivable | 5,967 | - | ||||
Prepaid assets and other current assets | 3,463 | 4,842 | ||||
Total Current Assets | 79,844 | 105,962 | ||||
Property and equipment, net | 1,348 | 1,442 | ||||
Operating lease right-of-use asset, net | 1,582 | 1,736 | ||||
Software development costs, net | 1,647 | 1,792 | ||||
Investment in Equity Securities | 582 | 1,838 | ||||
Long-term investments | 2,500 | 2,500 | ||||
Intangible assets, net | 30,126 | 33,478 | ||||
Goodwill | - | 7,672 | ||||
Other assets | 217 | 253 | ||||
Total Assets | $ | 117,846 | $ | 156,673 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||
Current Liabilities | ||||||
Accounts payable | $ | 900 | $ | 2,414 | ||
Accrued liabilities | 4,116 | 10,665 | ||||
Operating lease obligation, current | 600 | 643 | ||||
Deferred revenue | 3,638 | 4,805 | ||||
Short-term debt | 1,911 | 3,490 | ||||
Acquisition liability | 3,486 | 5,114 | ||||
Total Current Liabilities | 14,651 | 27,131 | ||||
Long Term Liabilities | ||||||
Operating lease obligations, noncurrent | 1,022 | 1,108 | ||||
Other liabilities, noncurrent | 28 | 28 | ||||
Acquisition liability, noncurrent | -- | 220 | ||||
Total Liabilities | 15,701 | 28,487 | ||||
Commitments and Contingencies | -- | -- | ||||
Mezzanine Equity | ||||||
Series 7 Convertible Preferred Stock - 58,750 shares authorized; zero and 49,250 | -- | 44,695 | ||||
Series 8 Convertible Preferred Stock - 53,197.7234 shares authorized; 53,197.7234 | 48,158 | -- | ||||
Stockholders' Equity | ||||||
Preferred Stock - | ||||||
Series 4 Convertible Preferred Stock - 10,415 shares authorized; 1 issued and 1 | -- | -- | ||||
Series 5 Convertible Preferred Stock - 12,000 shares authorized; 126 issued and | -- | -- | ||||
Common Stock - | 155 | 124 | ||||
Additional paid-in capital | 334,436 | 332,639 | ||||
Treasury stock, at cost, 1 share | (695) | (695) | ||||
Accumulated other comprehensive income | 598 | 44 | ||||
Accumulated deficit | (281,463) | (250,309) | ||||
Stockholders' Equity Attributable to Inpixon | 53,031 | 81,803 | ||||
Non-controlling interest | 956 | 1,688 | ||||
Total Stockholders' Equity | 53,987 | 83,491 | ||||
Total Liabilities, Mezzanine Equity and Stockholders' Equity | $ | 117,846 | $ | 156,673 | ||
INPIXON AND SUBSIDIARIES | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||||||
(In thousands, except per share data) | ||||||||||||
For the Three Months Ended, | For the Six Months | |||||||||||
June 30, | June 30, | |||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||
(Unaudited) | (Unaudited) | |||||||||||
Revenues | $ | 4,725 | $ | 3,453 | $ | 9,956 | $ | 6,407 | ||||
Cost of Revenues | 1,396 | 896 | 2,782 | 1,780 | ||||||||
Gross Profit | 3,329 | 2,557 | 7,174 | 4,627 | ||||||||
Operating Expenses | ||||||||||||
Research and development | 4,912 | 3,223 | 8,997 | 5,931 | ||||||||
Sales and marketing | 2,324 | 2,073 | 4,600 | 3,712 | ||||||||
General and administrative | 6,897 | 8,828 | 13,002 | 17,999 | ||||||||
Acquisition related costs | 147 | 535 | 268 | 1,005 | ||||||||
Impairment of goodwill | 7,570 | -- | 7,570 | -- | ||||||||
Amortization of intangibles | 1,369 | 1,191 | 2,691 | 1,693 | ||||||||
Total Operating Expenses | 23,219 | 15,850 | 37,128 | 30,340 | ||||||||
Loss from Operations | (19,890) | (13,293) | (29,954) | (25,713) | ||||||||
Other Income (Expense) | ||||||||||||
Interest income/(expense), net | 176 | 1,555 | 178 | 1,206 | ||||||||
Loss on exchange of debt for equity | -- | -- | -- | (30) | ||||||||
Recovery of valuation allowance on related party loan - | -- | 7,462 | -- | 7,345 | ||||||||
Other (expense)/income, net | (879) | 125 | (771) | 511 | ||||||||
Gain on related party loan - held for sale | -- | 49,817 | -- | 49,817 | ||||||||
Unrealized gain/(loss) on equity securities | 247 | (28,965) | (1,256) | (28,965) | ||||||||
Total Other Income (Expense) | (456) | 29,994 | (1,849) | 29,884 | ||||||||
Net Loss (Income), before tax | (20,346) | 16,701 | (31,803) | 4,171 | ||||||||
Income tax benefit/(provision) | 16 | (2,195) | (84) | (2,204) | ||||||||
Net (Loss) Income | (20,330) | 14,506 | (31,887) | 1,967 | ||||||||
Net (Loss) Income Attributable to Non-controlling | (458) | (253) | (804) | (235) | ||||||||
Net Loss Attributable to Stockholders of Inpixon | $ | (19,872) | $ | 14,759 | $ | (31,083) | $ | 2,202 | ||||
Accretion of Series 7 preferred stock | -- | -- | (4,555) | -- | ||||||||
Accretion of Series 8 Preferred Stock | (6,237) | -- | (6,785) | -- | ||||||||
Deemed dividend for the modification related to Series | -- | -- | (2,627) | -- | ||||||||
Deemed contribution for the modification related to | -- | -- | 1,469 | -- | ||||||||
Amortization premium- modification related to Series 8 | 1,252 | -- | 1,362 | -- | ||||||||
Net Loss (Income) Attributable to Common | $ | (24,857) | $ | 14,759 | $ | (42,219) | $ | 2,202 | ||||
Net Loss Per Share - Basic | $ | (0.16) | $ | 0.13 | $ | (0.29) | $ | 0.02 | ||||
Net Loss Per Share - Diluted | $ | (0.16) | $ | 0.13 | $ | (0.29) | $ | 0.02 | ||||
Weighted Average Shares Outstanding | ||||||||||||
Basic | 153,519,283 | 110,040,532 | 146,052,371 | 94,577,520 | ||||||||
Diluted | 153,519,283 | 110,041,378 | 146,052,371 | 94,591,619 | ||||||||
Comprehensive Loss | ||||||||||||
Net Loss | $ | (20,330) | $ | 14,506 | $ | (31,887) | $ | 1,967 | ||||
Unrealized gain on available for sale debt securities | 375 | -- | 375 | -- | ||||||||
Unrealized foreign exchange loss from cumulative | 282 | 52 | 180 | (619) | ||||||||
Comprehensive Loss | $ | (19,673) | $ | 14,558 | $ | (31,332) | $ | 1,348 | ||||
INPIXON AND SUBSIDIARIES | ||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||
(In thousands) | ||||||
For the Six Months Ended, | ||||||
June 30, | ||||||
2022 | 2021 | |||||
(Unaudited) | ||||||
Cash Flows Used In Operating Activities | ||||||
Net loss | $ | (31,887) | $ | 1,967 | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
Depreciation and amortization | 650 | 625 | ||||
Amortization of intangible assets | 3,026 | 2,007 | ||||
Amortization of right of use asset | 353 | 370 | ||||
Stock based compensation | 2,274 | 7,149 | ||||
Earnout expense valuation benefit | (2,827) | -- | ||||
Loss on exchange of debt for equity | -- | 30 | ||||
Amortization of debt discount | -- | 224 | ||||
Amortization of original issued discount | (92) | -- | ||||
Accrued interest income, related party | -- | (1,627) | ||||
Unrealized gain on note | 344 | (490) | ||||
Recovery for valuation allowance held for sale loan | -- | (7,345) | ||||
Gain on settlement of related party promissory note and loan related party receivable | -- | (49,817) | ||||
Deferred income tax | (1) | (4,507) | ||||
Unrealized loss on equity securities | 1,256 | 28,965 | ||||
Impairment of goodwill | 7,570 | -- | ||||
Other | 181 | 57 | ||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable and other receivables | 361 | 532 | ||||
Inventory | 285 | (555) | ||||
Prepaid expenses and other current assets | 1,357 | (319) | ||||
Other assets | 25 | 203 | ||||
Accounts payable | (1,498) | (331) | ||||
Accrued liabilities | 542 | 2,494 | ||||
Income tax liabilities | (40) | 6,711 | ||||
Deferred revenue | (1,096) | (238) | ||||
Operating lease obligation | (327) | (364) | ||||
Other liabilities | -- | 96 | ||||
Net Cash Used in Operating Activities | $ | (19,544) | $ | (14,163) | ||
Cash Flows Used in Investing Activities | ||||||
Purchase of property and equipment | (140) | (149) | ||||
Investment in capitalized software | (306) | (373) | ||||
Investments in short term investments | -- | (2,000) | ||||
Purchase of convertible note | (5,500) | -- | ||||
Purchases of treasury bills | -- | (63,362) | ||||
Sales of treasury bills | 43,001 | 28,000 | ||||
Purchase of Systat licensing agreement | -- | (900) | ||||
Acquisition of Game Your Game | -- | 184 | ||||
Acquisition of CXApp | -- | (15,186) | ||||
Acquisition of Visualix | -- | (61) | ||||
Net Cash Provided By (Used in) Investing Activities | $ | 37,055 | $ | (53,847) | ||
Cash From Financing Activities | ||||||
Net proceeds from issuance of preferred stock and warrants | $ | 46,906 | $ | -- | ||
Net proceeds from issuance of common stock and warrants | -- | 77,853 | ||||
Net proceeds from promissory note | 364 | -- | ||||
Cash paid for redemption of preferred stock series 7 | (49,250) | -- | ||||
Taxes paid related to net share settlement of restricted stock units | (336) | (1,687) | ||||
Loans to related party | -- | (117) | ||||
Repayment of CXApp acquisition liability | (1,847) | (137) | ||||
Repayment of acquisition liability to Nanotron shareholders | -- | (467) | ||||
Repayment of acquisition liability to Locality shareholders | -- | (500) | ||||
Net Cash (Used In) Provided By Financing Activities | $ | (4,163) | $ | 74,945 | ||
Effect of Foreign Exchange Rate on Changes on Cash | (73) | (19) | ||||
Net Increase in Cash and Cash Equivalents | 13,275 | 6,916 | ||||
Cash and Cash Equivalents - Beginning of period | 52,480 | 17,996 | ||||
Cash and Cash Equivalents - End of period | $ | 65,755 | $ | 24,912 | ||
Reconciliation of Non-GAAP Financial Measures: | ||||||||
For the Three Months Ended | For the Six Months Ended, | |||||||
(In thousands) | June 30, | June 30, | ||||||
2022 | 2021 | 2022 | 2021 | |||||
Net loss (income) attributable to common stockholders | (24,857) | 14,759 | (42,219) | 2,202 | ||||
Adjustments: | ||||||||
Non-recurring one-time charges: | ||||||||
Loss on exchange of debt for equity | - | - | - | 30 | ||||
Provision for valuation allowance on held for sale loan | - | (7,462) | - | (7,345) | ||||
Gain on related party loan held for sale | - | (49,817) | - | (49,817) | ||||
Unrealized loss on equity securities | (247) | 28,965 | 1,256 | 28,965 | ||||
Acquisition transaction/financing costs | 147 | 535 | 268 | 1,005 | ||||
Earnout compensation expense/(benefit) | - | 2,059 | (2,827) | 2,059 | ||||
Accretion of series 7 preferred stock | - | - | 4,555 | - | ||||
Accretion of series 8 preferred stock | 6,237 | - | 6,785 | - | ||||
Deemed dividend for the modification related to Series 8 Preferred | - | - | 2,627 | - | ||||
Deemed contribution for the modification related to warrants issued | - | - | (1,469) | - | ||||
Amortization premium- modification related to Series 8 Preferred | (1,252) | - | (1,362) | - | ||||
Professional service fees | - | 422 | 8 | 771 | ||||
Impairment of goodwill | 7,570 | - | 7,570 | - | ||||
Unrealized losses/(gains) on notes, loans, investments | 35 | (128) | 124 | (491) | ||||
Stock-based compensation – compensation and related benefits | 741 | 2,053 | 2,274 | 7,149 | ||||
Severance costs | 10 | - | 121 | - | ||||
Interest (income)/expense, net | (176) | (1,555) | (178) | (1,206) | ||||
Income tax benefit/(provision) | (16) | 2,195 | 84 | 2,204 | ||||
Depreciation and amortization | 1,870 | 1,695 | 3,676 | 2,638 | ||||
Adjusted EBITDA | (9,938) | (6,279) | $ (18,707) | $ (11,836) | ||||
- | ||||||||
For the Three Months Ended | For the Six Months Ended, | |||||||
(In thousands, except share data) | June 30, | June 30, | ||||||
2022 | 2021 | 2022 | 2021 | |||||
Net loss (income) attributable to common stockholders | (24,857) | 14,759 | $ (42,219) | $ 2,202 | ||||
Adjustments: | ||||||||
Non-recurring one-time charges: | ||||||||
Loss on exchange of debt for equity | - | - | - | 30 | ||||
Provision for valuation allowance on held for sale loan | - | (7,462) | - | (7,345) | ||||
Gain on related party loan held for sale | - | (49,817) | - | (49,817) | ||||
Unrealized loss on equity securities | (247) | 28,965 | 1,256 | 28,965 | ||||
Acquisition transaction/financing costs | 147 | 535 | 268 | 1,005 | ||||
Earnout compensation expense/(benefit) | - | 2,059 | (2,827) | 2,059 | ||||
Accretion of series 7 preferred stock | - | - | 4,555 | - | ||||
Accretion of series 8 preferred stock | 6,237 | - | 6,785 | - | ||||
Deemed dividend for the modification related to Series 8 Preferred | - | - | 2,627 | - | ||||
Deemed contribution for the modification related to warrants issued | - | - | (1,469) | - | ||||
Amortization premium- modification related to Series 8 Preferred | (1,252) | - | (1,362) | - | ||||
Professional service fees | - | 422 | 8 | 771 | ||||
Impairment of goodwill | 7,570 | - | 7,570 | - | ||||
Unrealized losses/(gains) on notes, loans, investments | 35 | (128) | 124 | (491) | ||||
Stock-based compensation – compensation and related benefits | 741 | 2,053 | 2,274 | 7,149 | ||||
Severance costs | 10 | - | 121 | - | ||||
Amortization of intangibles | 1,537 | 1,361 | 3,026 | 2,011 | ||||
Proforma non-GAAP net loss | (10,079) | (7,253) | (19,263) | (13,461) | ||||
Proforma non-GAAP net loss per basic and diluted common share | $ (0.07) | $ (0.07) | $ (0.13) | $ (0.14) | ||||
Weighted average basic and diluted common shares outstanding | 153,519,283 | 110,040,532 | 146,052,371 | 94,577,520 | ||||
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