nLIGHT, Inc. Announces Fourth Quarter and Full Year 2021 Results

Rhea-AI Summary

nLIGHT, Inc. (NASDAQ: LASR) reported 2021 revenues of $270.1 million, a 21.3% increase year-over-year, with a gross margin of 28.6%. In Q4 2021, revenue was $67.5 million, up 2.7% from Q4 2020, despite a 60% drop in sales from China. The company reported a net loss of $29.7 million for 2021, with a fourth-quarter net loss of $8.8 million. nLIGHT expects Q1 2022 revenues between $61 million and $67 million. The company is focused on growth outside China, achieving 89% of Q4 revenue from international customers.

Positive

• 21.3% revenue growth in 2021 compared to 2020.
• 89% of Q4 2021 revenue came from customers outside China.
• Adjusted EBITDA increased by 24.3% year-over-year for 2021.

Negative

• Net loss for 2021 increased to $29.7 million from $20.9 million in 2020.
• Fourth-quarter net loss of $8.8 million compared to a loss of $4.5 million in Q4 2020.
• 60% decrease in revenue from customers in China in Q4 2021.

Revenues of $270.1 million and gross margin of 28.6% for the full year 2021 Revenues of $67.5 million and gross margin of 26.6% for the fourth quarter of 2021

CAMAS, Wash.--(BUSINESS WIRE)-- nLIGHT, Inc. (Nasdaq: LASR), a leading provider of high-power semiconductor and fiber lasers used in the industrial, microfabrication, and aerospace and defense markets, today reported financial results for the fourth quarter and full year 2021.

“nLIGHT delivered 21% year-over-year revenue growth in 2021, which was driven by a 41% year-over-year increase in sales to customers outside of China and growth in each of our end markets,” commented Scott Keeney, nLIGHT’s President and Chief Executive Officer. “While our geographic focus has shifted, our strategy remains focused on leveraging our vertically integrated business model to enable key growth markets.”

“In the fourth quarter of 2021, approximately 89% of our revenue was from customers outside of China, which grew 27% year-over-year. Total revenue for the fourth quarter of 2021 increased 3% year-over-year to $67.5 million, despite a 60% decrease in revenue from customers in China. Gross margin and Adjusted EBITDA were within the guidance range we provided in November. We continue to believe we are well-positioned to grow faster than the overall industry in the long-term.”

Full Year 2021 Financial Highlights

	Year Ended December 31,
(In thousands, except percentages)		2021				2020			% Change
Revenues	$	270,146			$	222,789			21.3	%
Gross margin		28.6	%			26.6	%
Loss from operations	$	(30,217	)		$	(21,048	)		(43.6	) %
Operating margin		(11.2	) %			(9.4	) %
Net loss	$	(29,669	)		$	(20,932	)		(41.7	) %
Adjusted EBITDA(1)	$	22,562			$	18,151			24.3	%
Adjusted EBITDA, as a percentage of revenues		8.4	%			8.1	%
(1) A reconciliation of the non-GAAP information provided here to the most directly comparable GAAP metric has been provided in the financial statement tables included in this release.

Revenues of $270.1 million for the full year 2021 were up 21.3% compared to $222.8 million for the full year 2020. Gross margin was 28.6% for the full year 2021 compared to 26.6% for the full year 2020. GAAP net loss for the full year 2021 was $(29.7) million, or net loss of $(0.70) per diluted share, compared to net loss of $(20.9) million, or net loss of $(0.55) per diluted share, for the full year 2020. Non-GAAP net income for the full year 2021 was $10.7 million, or non-GAAP net income of $0.23 per diluted share, compared to non-GAAP net income of $7.3 million, or non-GAAP net income of $0.17 per diluted share, for the full year 2020. Reconciliations of the non-GAAP metrics presented here to the most directly comparable GAAP metrics have been provided in the tables included at the end of this release.

Fourth Quarter 2021 Financial Highlights

	Three Months Ended December 31,
(In thousands, except percentages)		2021				2020			% Change
Revenues	$	67,453			$	65,704			2.7	%
Gross margin		26.6	%			29.9	%
Loss from operations	$	(8,665	)		$	(4,286	)		(102.2	) %
Operating margin		(12.8	) %			(6.5	) %
Net loss	$	(8,750	)		$	(4,517	)		(93.7	) %
Adjusted EBITDA(1)	$	3,071			$	8,447			(63.6	) %
Adjusted EBITDA, as a percentage of revenues		4.6	%			12.9	%
(1) A reconciliation of the non-GAAP information provided here to the most directly comparable GAAP metric has been provided in the financial statement tables included in this release.

Revenues of $67.5 million for the fourth quarter of 2021 were up 2.7% compared to $65.7 million for the fourth quarter of 2020. Gross margin was 26.6% for the fourth quarter of 2021 compared to 29.9% for the fourth quarter of 2020. GAAP net loss for the fourth quarter of 2021 was $(8.8) million, or net loss of $(0.20) per diluted share, compared to net loss of $(4.5) million, or net loss of $(0.12) per diluted share, for the fourth quarter of 2020. Non-GAAP net loss for the fourth quarter of 2021 was $(0.2) million, or non-GAAP net loss of $(0.01) per diluted share, compared to non-GAAP net income of $5.2 million, or non-GAAP net income of $0.12 per diluted share, for the fourth quarter of 2020. Reconciliations of the non-GAAP metrics presented here to the most directly comparable GAAP metrics have been provided in the tables included at the end of this release.

Outlook

For the first quarter of 2022, nLIGHT expects revenues to be in the range of $61 million to $67 million, gross margin to be in the range of 21% to 25%, and Adjusted EBITDA to be approximately break-even.

We have not reconciled our outlook for Adjusted EBITDA because unrealized and realized foreign exchange gains and losses cannot be reasonably calculated or predicted nor can the probable significance be determined at this time. Accordingly, a reconciliation is not available without unreasonable effort.

Investor Conference Call at 2:00 p.m. Pacific Time, Thursday, February 17, 2022

Parties interested in listening to nLIGHT’s quarterly conference call may do so by dialing 1-833-535-2198 (U.S., toll-free) or +1-412-902-6775 (international and toll), with the conference title: nLIGHT Fourth Quarter 2021 Earnings. The call can also be accessed via the web by going to nLIGHT’s Investor Relations page at http://investors.nlight.net.

Use of Non-GAAP Financial Results

In addition to U.S. GAAP results, this press release contains non-GAAP financial results, including Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) per share, basic and diluted. We use Adjusted EBITDA to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. In addition to our results determined in accordance with GAAP, we believe Adjusted EBITDA is a meaningful measure of performance as it is commonly utilized by us and the investment community to analyze operating performance in our industry. Similarly, we believe that providing non-GAAP net income (loss) and non-GAAP net income (loss) per share, basic and diluted, is useful to our investors as they present an informative supplemental view of our results from period to period by removing the effect of stock-based compensation expense and other non-recurring items. However, the non-GAAP metrics presented herein are specific to us and may not be comparable to similar metrics disclosed by other companies because of differing methods used by other companies in calculating them.

We define Adjusted EBITDA as net income (loss) adjusted for income tax expense (benefit), other non-operating income or expense, interest income or expense, depreciation and amortization, stock-based compensation, acquisition and integration-related costs, and other non-recurring items as determined by management, as applicable. We define non-GAAP net income (loss) as GAAP net income (loss) adjusted for stock-based compensation, amortization of purchased intangibles, acquisition and integration-related costs, and other non-recurring items as determined by management, as applicable. We define non-GAAP net income (loss) per share, basic and diluted, as non-GAAP net income (loss) divided by weighted-average shares outstanding during the respective period plus the dilutive effect of any common stock equivalents during the period in the case of non-GAAP net income (loss) per share, diluted.

Tables presenting the reconciliation of net loss to Adjusted EBITDA, as well as the reconciliation of GAAP to non-GAAP net income (loss) and GAAP to non-GAAP net income (loss) per share, basic and diluted, are included at the end of this press release.

Safe Harbor Statement

Certain statements in this release are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Words such as “outlook,” “guidance,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “anticipates,” and similar expressions may identify these forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements regarding expected revenues, gross margin, and Adjusted EBITDA, our business strategy and ability to grow our business, and our expectations regarding customer demand for our products, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on our current expectations and assumptions, which may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially and adversely from these forward-looking statements, including but not limited to: (1)our ability to compete successfully in the markets for our products, (2) changes in the markets we serve or in the global economy, (3) our ability to increase our volumes and decrease our costs to offset potential declines in the average selling prices of our products, (4) rapid technological change in the markets that we participate in and our ability to develop and maintain products that can achieve market acceptance, (5) our ability to generate sufficient revenues to achieve or maintain profitability in the future, (6) our high levels of fixed costs and inventory and their effect on our gross profits and results of operations if demand for our products declines or we maintain excess inventory levels, (7) disruptions including pandemics, such as COVID-19, and their effect on our business, financial condition, or results of operations, (8) our manufacturing capacity and operations and their suitability for future levels of demand, (9) our reliance on a small number of customers for a significant portion of our revenues, (10) our ability to manage risks associated with international customers and operations, (11) the effect of current and potential tariffs and global trade policies on the cost of our products, (12) our ability to protect our proprietary technology and intellectual property rights, and (13) fluctuations in our quarterly results of operations and other operating measures. Additional information concerning these and other factors can be found in nLIGHT's filings with the Securities and Exchange Commission (the “SEC”), including other risks, relevant factors and uncertainties identified in the “Risk Factors” section of nLIGHT's most recent Annual Report on Form 10-K or subsequent filings with the SEC. nLIGHT undertakes no obligation to update publicly or revise any forward-looking statements contained herein to reflect future events or developments, except as required by law.

The nLIGHT logo and “nLIGHT” are registered trademarks or trademarks of nLIGHT, Inc. in various jurisdictions.

About nLIGHT

nLIGHT, Inc. is a leading provider of high-power semiconductor and fiber lasers for industrial, microfabrication, aerospace and defense applications. Our lasers are changing not only the way things are made but also the things that can be made. Headquartered in Camas, Washington, nLIGHT employs over 1,300 people with operations in the U.S., China, Finland, Korea and Italy. For more information, please visit www.nlight.net.

nLIGHT, Inc.
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
	Three Months Ended December 31,								Year Ended December 31,
		2021				2020				2021				2020
Revenue:
Products	$	50,906			$	51,690			$	206,195			$	184,841
Development		16,547				14,014				63,951				37,948
Total revenue		67,453				65,704				270,146				222,789
Cost of revenue:
Products		34,039				33,113				132,867				128,255
Development		15,472				12,944				59,972				35,170
Total cost of revenue(1)		49,511				46,057				192,839				163,425
Gross profit		17,942				19,647				77,307				59,364
Operating expenses:
Research and development(1)		13,984				12,028				54,814				41,164
Sales, general, and administrative(1)		12,623				11,905				52,710				39,248
Total operating expenses		26,607				23,933				107,524				80,412
Loss from operations		(8,665	)			(4,286	)			(30,217	)			(21,048	)
Other income (expense):
Interest income (expense), net		(37	)			(44	)			(163	)			78
Other income, net		90				315				336				378
Loss before income taxes		(8,612	)			(4,015	)			(30,044	)			(20,592	)
Income tax expense (benefit)		138				502				(375	)			340
Net loss	$	(8,750	)		$	(4,517	)		$	(29,669	)		$	(20,932	)
Net loss per share, basic	$	(0.20	)		$	(0.12	)		$	(0.70	)		$	(0.55	)
Net loss per share, diluted	$	(0.20	)		$	(0.12	)		$	(0.70	)		$	(0.55	)
Shares used in per share calculations:
Basic		43,277				38,877				42,142				38,367
Diluted		43,277				38,877				42,142				38,367

(1)Includes stock-based compensation as follows:
	Three Months Ended December 31,									Year Ended December 31,
		2021					2020				2021				2020
Cost of revenues	$	725				$	432			$	2,505			$	1,621
Research and development		3,025					3,101				13,433				9,703
Sales, general, and administrative		4,238					5,448				21,782				14,140
	$	7,988				$	8,981			$	37,720			$	25,464

nLIGHT, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
	As of
	December 31, 2021				December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	146,534			$	102,282
Accounts receivable, net		41,574				31,820
Inventory		73,746				54,706
Prepaid expenses and other current assets		15,350				11,767
Total current assets		277,204				200,575
Restricted cash		250				291
Lease right-of-use assets		17,048				12,302
Property, plant and equipment, net		56,101				44,480
Intangible assets, net		6,698				8,345
Goodwill		12,420				12,484
Other assets, net		3,897				5,167
Total assets	$	373,618			$	283,644
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	26,347			$	21,057
Accrued liabilities		14,730				15,321
Deferred revenue		1,629				2,528
Current portion of lease liabilities		3,066				2,273
Current portion of long-term debt		—				184
Total current liabilities		45,772				41,363
Non-current income taxes payable		7,149				7,556
Long-term lease liabilities		14,612				10,375
Long-term debt		—				215
Other long-term liabilities		3,952				4,221
Total liabilities		71,485				63,730
Stockholders' equity:
Common stock - par value		15				15
Additional paid-in capital		470,760				358,544
Accumulated other comprehensive loss		(587	)			(259	)
Accumulated deficit		(168,055	)			(138,386	)
Total stockholders’ equity		302,133				219,914
Total liabilities and stockholders’ equity	$	373,618			$	283,644

nLIGHT, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
	Year Ended December 31,
		2021				2020
Cash flows from operating activities:
Net loss	$	(29,669	)		$	(20,932	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation		9,179				7,710
Amortization		5,880				5,975
Reduction in carrying amount of right-of-use assets		3,253				2,916
Provision for (recoveries of) losses on accounts receivable		(70	)			88
Stock-based compensation		37,720				25,464
Deferred income taxes		37				(11	)
Loss on disposal of assets		16				—
Changes in operating assets and liabilities:
Accounts receivable, net		(9,509	)			(4,009	)
Inventory		(18,994	)			(6,937	)
Prepaid expenses and other current assets		(3,630	)			(3,442	)
Other assets, net		(570	)			(3,463	)
Accounts payable		3,463				7,306
Accrued and other long-term liabilities		(199	)			2,269
Deferred revenues		(909	)			1,800
Lease liabilities		(2,934	)			(2,820	)
Non-current income taxes payable		(507	)			1,127
Net cash provided by (used in) operating activities		(7,443	)			13,041
Cash flows from investing activities:
Acquisition of business, net of cash acquired		(291	)			(190	)
Purchases of property, plant and equipment		(19,317	)			(23,416	)
Acquisition of intangible assets and capitalization of patents		(2,245	)			(933	)
Net cash used in investing activities		(21,853	)			(24,539	)
Cash flows from financing activities:
Proceeds from public offerings, net of offering costs		82,354				—
Proceeds from term loan		—				15,000
Principal payments on term loan, debt and financing leases		(428	)			(15,115	)
Payment of contingent consideration related to acquisition		(326	)			—
Proceeds from employee stock plan purchases		1,603				1,393
Proceeds from stock option exercises		1,145				1,375
Tax payments related to stock award issuances		(10,606	)			(6,420	)
Net cash provided by (used in) financing activities		73,742				(3,767	)
Effect of exchange rate changes on cash		(235	)			545
Net increase (decrease) in cash, cash equivalents and restricted cash		44,211				(14,720	)
Cash, cash equivalents and restricted cash, beginning of period		102,573				117,293
Cash, cash equivalents and restricted cash, end of period	$	146,784			$	102,573
Supplemental disclosures:
Cash paid (received) for interest, net	$	117			$	(311	)
Cash paid for income taxes		526				647
Operating cash outflows from operating leases		3,513				2,919
Right-of-use assets obtained in exchange for lease liabilities		8,012				15,127
Accrued purchases of property, equipment and patents		2,522				788

nLIGHT, Inc.
Reconciliation of GAAP Financial Metrics to Non-GAAP
(In thousands, except per share data)
(Unaudited)
Reconciliation of Net Loss to Adjusted EBITDA
	Three Months Ended December 31,								Year Ended December 31,
		2021				2020				2021				2020
Net loss	$	(8,750	)		$	(4,517	)		$	(29,669	)		$	(20,932	)
Income tax expense (benefit)		138				502				(375	)			340
Other income, net		(90	)			(315	)			(336	)			(378	)
Interest (income) expense, net		37				44				163				(78	)
Depreciation and amortization		3,748				3,752				15,059				13,685
Stock-based compensation		7,988				8,981				37,720				25,464
Acquisition and integration-related costs		—				—				—				50
Adjusted EBITDA	$	3,071			$	8,447			$	22,562			$	18,151

Reconciliation of GAAP to Non-GAAP Net Income (Loss), and GAAP to Non-GAAP Net Income (Loss) per Share, Basic and Diluted
	Three Months Ended December 31,								Year Ended December 31,
		2021				2020				2021				2020
Net loss	$	(8,750	)		$	(4,517	)		$	(29,669	)		$	(20,932	)
Add back:
Stock-based compensation(1)		7,988				8,981				37,720				25,464
Amortization of purchased intangibles (1)		518				716				2,671				2,724
Acquisition and integration-related costs (1)		—				—				—				50
Non-GAAP net income (loss)		(244	)			5,180				10,722				7,306
GAAP weighted-average shares outstanding		43,277				38,877				42,142				38,367
Participating securities		—				653				699				544
Non-GAAP weighted-average number of shares, basic		43,277				39,530				42,841				38,911
Dilutive effect of common stock equivalents		—				4,654				4,341				4,228
Non-GAAP weighted-average number of shares, diluted		43,277				44,184				47,182				43,139
Non-GAAP net income (loss) per share, basic	$	(0.01	)		$	0.13			$	0.25			$	0.19
Non-GAAP net income (loss) per share, diluted	$	(0.01	)		$	0.12			$	0.23			$	0.17
(1) There is no income tax effect related to the stock-based compensation, amortization of purchased intangibles, and acquisition and integration-related cost adjustments due to the full valuation allowance in the U.S.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220217005891/en/

Joseph Corso

VP, Corporate Development and Investor Relations

nLIGHT, Inc.

(360) 566-4460

joe.corso@nlight.net

Source: nLIGHT, Inc.

FAQ

What were nLIGHT's revenues for the full year 2021?

nLIGHT reported revenues of $270.1 million for the full year 2021.

What is nLIGHT's stock symbol?

nLIGHT is publicly traded under the stock symbol LASR.

What were nLIGHT's net losses for Q4 2021?

nLIGHT reported a net loss of $8.8 million for Q4 2021.

How much revenue did nLIGHT generate outside China?

Approximately 89% of nLIGHT's Q4 revenue came from customers outside of China.

What is nLIGHT's revenue outlook for Q1 2022?

nLIGHT expects Q1 2022 revenues to be between $61 million and $67 million.