Intevac Announces Fourth Quarter and Full Year 2023 Financial Results
- None.
- Gross margin decreased from 42.2% in 2022 to 38.4% in 2023, and operating expenses increased from $31.6 million in 2022 to $33.5 million in 2023.
Insights
The reported financial results of Intevac, Inc. indicate a significant year-over-year revenue growth of 47%, with total revenues of $52.7 million for fiscal 2023. This growth is primarily driven by the demand for heat-assisted magnetic recording (HAMR) technology upgrades within the hard disk drive (HDD) industry. The successful negotiation of order backlogs and the completion of the TRIO™ development program are pivotal events that could potentially shape the company's future revenue streams.
From a market research perspective, the HAMR technology transition represents a substantial advancement in data storage technology, with the potential to increase the density and capacity of HDDs. This could extend the relevance of HDDs in an era increasingly dominated by solid-state drives (SSDs). Intevac's role in this transition could position the company as a key supplier within the HDD market, benefiting from the ongoing technology upgrade cycle.
Furthermore, the TRIO platform's qualification opens up new market opportunities for Intevac, with an estimated served market of $1 billion. This diversification could mitigate the risk associated with the company's dependence on the HDD segment and provide additional revenue streams.
Intevac's financial performance, particularly the 47% increase in annual revenue and the achievement of record HDD upgrade sales, suggests operational efficiency and a strong market position in its niche. However, the company still reported a net loss of $12.2 million, or $0.47 per diluted share, for fiscal 2023. Although this is an improvement from the previous year's net loss of $17.1 million, or $0.68 per diluted share, it indicates that despite top-line growth, profitability remains a challenge.
The company's balance sheet shows $72.2 million in cash, restricted cash and investments, which is slightly below forecast due to delayed collections. This liquidity position is crucial for the company's ability to invest in future growth opportunities and manage operating costs. Investors should monitor the company's ability to convert its technological advancements and market opportunities into sustainable profitability.
It is also worth noting that the non-GAAP financial measures exclude certain costs such as restructuring charges, which management uses to assess the company's performance. While these measures provide a clearer picture of ongoing operational efficiency, investors should consider both GAAP and non-GAAP results to understand the company's financial health comprehensively.
The significance of HAMR technology in the HDD industry cannot be overstated, as it represents a major leap in storage technology capable of meeting the data-intensive demands of modern computing. Intevac's strategic focus on HAMR upgrades for its 200 Lean® flagship platform suggests that the company is at the forefront of this technological shift.
The TRIO platform's qualification is another technological milestone for Intevac. The platform's ability to meet key performance metrics indicates potential for market leadership in a new segment. As Intevac aims to address a $1 billion served market, the technological prowess and innovation embedded in the TRIO platform could be a game-changer for the company's growth trajectory.
Understanding the technical nuances of HAMR technology and the TRIO platform's capabilities will be essential for stakeholders to assess Intevac's competitive edge and potential for long-term growth in the evolving data storage market.
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 $52.7 million 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
$72.2 million
“We are pleased to announce a strong finish for fiscal 2023, within both of our primary served markets,” commented Nigel Hunton, president and chief executive officer. “In our HDD business, during what was one of the most challenging years in the industry’s history, we achieved exceptionally strong year-over-year revenue growth of
“Looking forward, the most important new driver of Intevac’s future revenue growth is our groundbreaking TRIO platform, and our first system achieved qualification in the fourth quarter. This is a key milestone in the growth trajectory of Intevac, as the TRIO achieved key performance metrics that will enable Intevac to address an estimated
“The achievements of 2023 place Intevac on a solid trajectory for future growth, with the strength of the balance sheet maintained,” Mr. Hunton concluded. “We have taken a key step forward in our plan to diversify and grow our product portfolio and customer base, and we look forward to achieving greater success and momentum in each of our end markets in 2024.”
($ 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
The net loss for the quarter was
Order backlog was
The Company ended the year with
Fiscal Year 2023 Summary
Revenues were
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
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 ( |
|
|
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
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
Source: Intevac, Inc.
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