Latch Completes Restatement of Previously Issued Financial Statements and Files 2022 Annual Report on Form 10-K
Latch Inc. (LTCH) has completed its previously announced restatement and filed its 2022 Annual Report, along with quarterly reports for Q2 and Q3 2022. The restatement was necessary after an audit committee investigation revealed errors in financial statements from 2019-2022, affecting revenue recognition, expenses, and stock-based compensation.
Key 2022 metrics show software revenue of $13.02M and total revenue of $42.96M, with a net loss of $162.34M. The restatement impact increased previously reported net losses by $2.6M for Q1 2022, $827K for 2021, and $1.43M for 2020. The company expects to file 2023 reports in Q1 2025 and is working on 2024 filings.
Latch Inc. (LTCH) ha completato la rivalutazione precedentemente annunciata e ha presentato il suo Rapporto Annuale 2022, insieme ai rapporti trimestrali per il secondo e il terzo trimestre del 2022. La rivalutazione è stata necessaria dopo che un'indagine del comitato di audit ha rivelato errori nei bilanci finanziari dal 2019 al 2022, che hanno influenzato il riconoscimento delle entrate, le spese e le compensazioni basate sulle azioni.
I principali metri del 2022 mostrano entrate da software di 13,02 milioni di dollari e un'entrata totale di 42,96 milioni di dollari, con una perdita netta di 162,34 milioni di dollari. L'impatto della rivalutazione ha aumentato le perdite nette precedentemente riportate di 2,6 milioni di dollari per il primo trimestre del 2022, 827 mila dollari per il 2021 e 1,43 milioni di dollari per il 2020. L'azienda prevede di presentare i rapporti del 2023 nel primo trimestre del 2025 e sta lavorando alla presentazione per il 2024.
Latch Inc. (LTCH) ha completado su revisión previamente anunciada y ha presentado su Informe Anual 2022, junto con los informes trimestrales para el segundo y tercer trimestre de 2022. La revisión fue necesaria después de que una investigación del comité de auditoría revelara errores en los estados financieros de 2019 a 2022, lo que afectó el reconocimiento de ingresos, gastos y compensaciones basadas en acciones.
Las métricas clave de 2022 muestran ingresos por software de 13,02 millones de dólares y un ingreso total de 42,96 millones de dólares, con una pérdida neta de 162,34 millones de dólares. El impacto de la revisión aumentó las pérdidas netas previamente reportadas en 2,6 millones de dólares para el primer trimestre de 2022, 827 mil dólares para 2021 y 1,43 millones de dólares para 2020. La compañía espera presentar los informes de 2023 en el primer trimestre de 2025 y está trabajando en los informes de 2024.
Latch Inc. (LTCH)는 이전에 발표된 재작성 작업을 완료하고 2022년 연례 보고서와 2022년 2분기 및 3분기에 대한 분기 보고서를 제출했습니다. 재작성은 감사 위원회의 조사에서 2019년부터 2022년까지의 재무 제표에서 오류가 발견되어 필요하게 되었습니다. 이 오류는 수익 인식, 비용 및 주식 기반 보상에 영향을 미쳤습니다.
2022년 주요 지표는 소프트웨어 수익이 1302만 달러, 총 수익이 4296만 달러, 그리고 순손실이 1억6234만 달러임을 보여줍니다. 재작성 영향으로 인해 2022년 1분기에 대해 이미 보고된 순손실이 260만 달러, 2021년에 82만 7천 달러, 2020년에 143만 달러 증가했습니다. 회사는 2023년 보고서를 2025년 1분기에 제출할 것으로 예상하며, 2024년 제출 작업을 진행 중입니다.
Latch Inc. (LTCH) a terminé sa réévaluation précédemment annoncée et a déposé son Rapport Annuel 2022, ainsi que les rapports trimestriels pour le deuxième et le troisième trimestre 2022. La réévaluation était nécessaire après qu'une enquête du comité d'audit a révélé des erreurs dans les états financiers de 2019 à 2022, affectant la reconnaissance des revenus, les dépenses et les compensations basées sur des actions.
Les principales indicateurs de 2022 montrent un revenu logiciel de 13,02 millions de dollars et un revenu total de 42,96 millions de dollars, avec une perte nette de 162,34 millions de dollars. L'impact de la réévaluation a augmenté les pertes nettes précédemment signalées de 2,6 millions de dollars pour le T1 2022, de 827 000 dollars pour 2021 et de 1,43 million de dollars pour 2020. L'entreprise prévoit de déposer les rapports de 2023 au T1 2025 et travaille sur les dépôts de 2024.
Latch Inc. (LTCH) hat die zuvor angekündigte Neufassung abgeschlossen und seinen Jahresbericht 2022 sowie die Quartalsberichte für das 2. und 3. Quartal 2022 eingereicht. Die Neufassung war notwendig, nachdem eine Untersuchung des Prüfungsausschusses Fehler in den Finanzberichten von 2019 bis 2022 aufgedeckt hatte, die die Umsatzrealisierung, Ausgaben und aktienbasierte Vergütung betrafen.
Die wichtigsten Kennzahlen für 2022 zeigen Software-Umsätze von 13,02 Millionen Dollar und Gesamterlöse von 42,96 Millionen Dollar, bei einem Nettoverlust von 162,34 Millionen Dollar. Der Einfluss der Neufassung erhöhte die zuvor gemeldeten Nettoverluste um 2,6 Millionen Dollar für das 1. Quartal 2022, 827 Tausend Dollar für 2021 und 1,43 Millionen Dollar für 2020. Das Unternehmen plant, die Berichte für 2023 im 1. Quartal 2025 einzureichen und arbeitet an den Berichten für 2024.
- Software revenue growth from $3.43M in 2020 to $13.02M in 2022
- Completion of financial restatement process and filing of 2022 Annual Report
- Clear timeline for filing 2023 reports in Q1 2025
- Net loss of $162.34M in 2022
- Adjusted EBITDA loss widened to $118.57M in 2022 from $103.89M in 2021
- Financial restatement revealed significant accounting errors requiring corrections back to 2019
- Delayed SEC filings affecting OTC Markets quotation
The Company continues to work diligently to file its 2023 and 2024 SEC reports
The completion of the restatement and the filing of the associated reports with the SEC are major milestones for the Company as it continues to work to become current with its SEC filing obligations, and to obtain quotation of its securities on the OTC Markets.
The Company has made significant progress toward completing its outstanding SEC filings for the year ended December 31, 2023 and expects to make such filings in the first quarter of 2025. The Company is also working diligently toward completing its outstanding SEC filings for the year ending December 31, 2024.
The table below summarizes the Company’s key business metrics for 2022, 2021, and 2020.
Key Business Metrics
(in thousands)
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Year ended December 31, |
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2022 |
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2021 |
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2020 |
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(restated) |
(restated) |
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GAAP(1) Measures |
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Software revenue |
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Total revenue |
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Net loss |
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Non-GAAP Measure |
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Adjusted EBITDA |
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(1) Generally accepted accounting principles in |
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Restatement and 2022 10-K Filing Overview
During the quarter ended June 30, 2022, the audit committee (the “Audit Committee”) of the Company’s board of directors commenced an investigation (the “Investigation”) of certain of the Company’s key performance indicators and revenue recognition practices, including the accounting treatment, financial reporting, and internal controls related thereto. Based on the findings of the Investigation, the Audit Committee determined that the Company’s consolidated financial statements for the years ended December 31, 2019, 2020, and 2021 and the quarter ended March 31, 2022 (the “Prior Financial Statements”) should no longer be relied upon.
Following the Investigation, the Company completed a comprehensive review of the Prior Financial Statements (the “Financial Statement Review”). During the course of the Investigation and Financial Statement Review, the Company identified errors in the Prior Financial Statements related to, among other items, (i) revenue recognition of hardware and software sales, (ii) revenue recognition and billing on software licenses, (iii) recognition of various expenses, (iv) internally developed software, and (v) stock-based compensation.
Accordingly, the Company restated the financial statements (i) as of and for the period ended December 31, 2021 and (ii) for the period ended December 31, 2020 (collectively, the “Restated Financial Statement Periods”), as presented in the audited financial statements as of and for the period ended December 31, 2022 in the 2022 Annual Report. The impact of the errors for the period ended December 31, 2019 was adjusted through opening equity as of January 1, 2020 in the audited financial statements presented in the 2022 Annual Report.
The 2022 Annual Report also includes additional unaudited adjusted financial data as of or for certain periods between 2019 and the quarterly period ended March 31, 2022.
The impact of the restatement and related adjustments on the Company’s net loss is presented in the table below:
Net Loss
(in thousands)
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Three months ended |
Year ended December 31, |
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March 31, 2022 |
2021 |
2020 |
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Previously Reported |
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Restated |
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Change |
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More details, including the impact of the restatement adjustments on each of the annual and interim financial statements and financial information for the relevant periods and a description of the primary categories of adjustments, are presented in the 2022 Annual Report.
About Latch, Inc.
Latch makes spaces better places to live, work, and visit through a system of software, devices, and services. For more information, please visit www.latch.com.
About DOOR
DOOR is on a mission to redefine property management and elevate residential living through the power of AI and machine learning. The DOOR App brings together access control, IoT integrations, and a growing suite of services for residents and property managers, all in one seamless platform. With a vision to expand into physical security and advanced property management solutions, DOOR is continuously evolving to meet the needs of modern living. By leveraging AI-driven insights and automation, we help reduce costs for building owners while creating the connected living experience residents expect. Visit DOOR.com to learn more.
Key Business Metrics
Latch reviews key business metrics to measure its performance, identify trends affecting its business, formulate business plans, and make strategic decisions that will impact the future operating results of the Company. For definitions of our key business metrics, see the 2022 Annual Report. Increases or decreases in the Company’s key business metrics may not correspond with increases or decreases in its revenue.
The limitations these key business metrics have as an analytical tool include: (1) they are not necessarily indicative of the Company’s future financial results and (2) other companies, including companies in Latch’s industry, may calculate key business metrics or similarly titled measures differently, which reduces their usefulness as comparative measures.
Non-GAAP Financial Measures
To supplement our financial statements presented in accordance with GAAP and to provide investors with additional information regarding our financial results, we have presented in this release Adjusted EBITDA, a non-GAAP financial measure. Adjusted EBITDA is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to similarly titled measures presented by other companies.
We define Adjusted EBITDA as our net loss, excluding the impact of stock-based compensation expense, depreciation and amortization expense, interest income, interest expense, provision for income taxes, restructuring, non-ordinary course legal fees and settlement reserves, loss on extinguishment of debt, gain or loss on change in fair value of derivative instruments, warrant liabilities and trading securities, and transaction-related expenses. The most directly comparable GAAP measure is net loss. We believe excluding the impact of these items in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance. We monitor, and have presented in this release, Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our operating performance, to establish budgets, and to develop operational goals for managing our business. We believe Adjusted EBITDA helps identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we include in net loss. Accordingly, we believe Adjusted EBITDA provides useful information to investors, analysts, and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance.
Adjusted EBITDA is not prepared in accordance with GAAP and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of Adjusted EBITDA rather than net loss, which is the most directly comparable financial measure calculated and presented in accordance with GAAP. In addition, the expenses and other items that we exclude in our calculations of Adjusted EBITDA may differ from the expenses and other items, if any, that other companies may exclude from Adjusted EBITDA when they report their operating results.
In addition, other companies may use other measures to evaluate their performance, all of which could reduce the usefulness of Adjusted EBITDA as a tool for comparison. The following table reconciles Adjusted EBITDA to net loss, the most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands):
| Year Ended December 31, | |||||||||||
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2022 |
|
|
2021 |
|
|
2020 |
|
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| (restated) | (restated) | ||||||||||
| Net Loss | $ |
(162,336 |
) |
$ |
(167,146 |
) |
$ |
(67,423 |
) |
||
| Depreciation and amortization | $ |
5,504 |
|
$ |
3,093 |
|
$ |
1,418 |
|
||
| Interest (income) expense, net(a) | $ |
2,961 |
|
$ |
7,761 |
|
$ |
3,172 |
|
||
| Provision for income taxes | $ |
89 |
|
$ |
53 |
|
$ |
8 |
|
||
| Loss on extinguishment of debt |
|
— |
|
$ |
1,469 |
|
$ |
199 |
|
||
| Change in fair value of derivative liabilities |
|
— |
|
$ |
12,512 |
|
$ |
939 |
|
||
| Change in fair value of warrant liability | $ |
(9,558 |
) |
$ |
(4,085 |
) |
|
— |
|
||
| Change in fair value of trading securities | $ |
3,460 |
|
$ |
(50 |
) |
|
— |
|
||
| Restructuring costs(b) | $ |
8,573 |
|
|
— |
|
$ |
1,065 |
|
||
| Transaction-related costs(c) | $ |
468 |
|
$ |
6,526 |
|
$ |
1,618 |
|
||
| Non-ordinary course legal fees and settlement reserves(d) | $ |
2,010 |
|
$ |
6,927 |
|
$ |
1,035 |
|
||
| Stock-based compensation and warrant expense(e) | $ |
30,256 |
|
$ |
29,055 |
|
$ |
1,926 |
|
||
| Adjusted EBITDA | $ |
(118,573 |
) |
$ |
(103,885 |
) |
$ |
(56,043 |
) |
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(a) |
As a result of significant discounts provided to our customers on certain long-term software contracts paid in advance, the Company has determined that there is a significant financing component related to the time value of money and has therefore broken out the interest component and recorded it as a component of interest expense, net on its consolidated statements of operations and comprehensive loss. Interest income (expense), net includes interest expense associated with the significant financing component of |
(b) |
Restructuring costs resulting from the reductions in force the Company conducted in 2022. |
(c) |
Transaction costs related to the 2021 business combination. These costs are included in research and development, sales and marketing, and general and administrative on the Company’s consolidated statements of operations and comprehensive loss. |
(d) |
Non-ordinary course legal fees and settlement reserves incurred in connection with non-ordinary course litigation and disputes, including |
| (e) | Warrant expense was recognized only during the year ended December 31, 2020. |
FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "would," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Forward-looking information includes, but is not limited to, statements regarding: the timing of the Company’s filings with the SEC and the trading or quotation of the Company’s securities on any particular market or exchange. Many factors could cause actual future events to differ materially from the forward-looking statements in this release, including: the Company's ability to implement its plans; unexpected delays or difficulties; and other factors outside of the Company’s control. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the "Risk Factors" section of the 2022 Annual Report and other documents filed by the Company from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law, including the securities laws of
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Media Contact
press@latch.com
Source: Latch, Inc.
FAQ
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