Impinj Reports Fourth Quarter and Full Year 2021 Financial Results

Rhea-AI Summary

Impinj, Inc. (NASDAQ: PI) reported strong financial results for Q4 and the full year 2021, with record bookings and revenue. Q4 revenue reached $52.6 million, with a GAAP gross margin of 55.5% and adjusted EBITDA of $5.3 million. For the full year, revenue totaled $190.3 million with a GAAP net loss of $51.3 million. Non-GAAP net income for the year was $6.4 million, or $0.25 per diluted share, highlighting a solid operational performance despite overall losses.

Positive

• Record Q4 revenue of $52.6 million.
• Year-end revenue of $190.3 million, marking significant growth.
• Improvement in adjusted EBITDA to $5.3 million in Q4.
• Launch of key new products and expansion of 300mm post-processing capacity.

Negative

• GAAP net loss of $20.0 million in Q4.
• Full year GAAP net loss of $51.3 million.

SEATTLE--(BUSINESS WIRE)-- Impinj, Inc. (NASDAQ: PI), a leading provider and pioneer of RAIN RFID solutions, today released its financial results for the fourth quarter and year ended December 31, 2021.

“Our fourth-quarter results capped a strong close to an exceptional year,” said Chris Diorio, Impinj co-founder and CEO. “We delivered record bookings, revenue and adjusted EBITDA while launching key new products, investing in our team, building our 300mm post-processing capacity and accelerating our Impinj M700 endpoint IC ramp.”

Fourth Quarter 2021 Financial Summary

• Revenue of $52.6 million
• GAAP gross margin of 55.5%; non-GAAP gross margin of 58.2%
• GAAP net loss of $20.0 million, or loss of $0.81 per diluted share using 24.6 million shares
• Adjusted EBITDA of $5.3 million
• Non-GAAP net income of $4.3 million, or income of $0.16 per diluted share using 26.8 million shares

Full Year 2021 Financial Summary

• Revenue of $190.3 million
• GAAP gross margin of 52.0%; non-GAAP gross margin of 54.2%
• GAAP net loss of $51.3 million, or loss of $2.12 per diluted share using 24.2 million shares
• Adjusted EBITDA of $9.1 million
• Non-GAAP net income of $6.4 million, or income of $0.25 per diluted share using 25.9 million shares

A reconciliation between GAAP and non-GAAP information is contained in the tables below. Additionally, descriptions of these non-GAAP financial measures are provided in the “Non-GAAP Financial Measures” sections below.

First Quarter 2022 Financial Outlook

Impinj provides guidance based on current market conditions and expectations; actual results may differ materially. Please refer to the comments below regarding forward-looking statements. The following table presents Impinj’s financial outlook for the first quarter of 2022 (in millions, except per share data):

		Three Months Ending
		March 31, 2022
Revenue		$50.0 to $52.0
GAAP Net loss		($14.6) to ($13.1)
Adjusted EBITDA income		$0.1 to $1.6
GAAP Weighted-average shares — basic and diluted		24.90 to 25.10
GAAP Net loss per share — basic and diluted		($0.58) to ($0.52)
Non-GAAP net income (loss)		($1.1) to $0.4
Non-GAAP Weighted-average shares — basic		24.90 to 25.10
Non-GAAP Weighted-average shares — diluted		24.90 to 27.20
Non-GAAP Net income (loss) per share — basic and diluted		($0.05) to $0.01

A reconciliation between GAAP and non-GAAP is provided in the "Non-GAAP Financial Measures" section below.

Conference Call Information

Impinj will host a conference call today, February 9, 2022 at 5:00 p.m. ET / 2:00 p.m. PT to discuss its fourth-quarter and full-year 2021 results, as well as its outlook for its first quarter 2022. Interested parties may access the call by dialing +1-412-317-5196. A live webcast and replay will also be available on the company’s website at investor.impinj.com. Following the call, a telephonic replay will be available for five business days and may be accessed by dialing +1-412-317-0088 and entering passcode 6917537.

Management’s prepared written remarks, along with quarterly financial data, will be made available on the company’s website at investor.impinj.com along with this release.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding the market for RAIN RFID, our strategy, prospects, the impact of Covid-19, and financial considerations for the first quarter of 2022 and future periods.

Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance.

The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption "Risk Factors" and elsewhere in our annual report on Form 10-K and quarterly reports on Form 10-Q filed with the U.S. Securities and Exchange Commission. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update this information unless required by law.

About Impinj

Impinj (NASDAQ: PI) helps businesses and people analyze, optimize, and innovate by wirelessly connecting billions of everyday things — such as apparel, automobile parts, luggage, and shipments — to the Internet. The Impinj platform uses RAIN RFID to deliver timely data about these everyday things to business and consumer applications, enabling a boundless Internet of Things. www.impinj.com

Impinj is a registered trademark of Impinj, Inc. All other trademarks are the property of their owners.

IMPINJ, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except par value, unaudited)
		December 31, 2021 (1)				December 31, 2020
Assets:
Current assets:
Cash and cash equivalents		$	123,903			$	23,636
Short-term investments			69,443				82,453
Accounts receivable, net			35,449				25,003
Inventory			21,958				36,329
Prepaid expenses and other current assets			5,049				3,943
Total current assets			255,802				171,364
Long-term investments			14,225				—
Property and equipment, net			27,500				16,531
Operating lease right-of-use assets			11,667				13,761
Other non-current assets			2,462				2,079
Goodwill			3,881				3,881
Total assets		$	315,537			$	207,616
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable		$	11,732			$	10,144
Accrued compensation and employee related benefits			6,365				5,529
Accrued and other current liabilities			2,481				1,468
Current portion of operating lease liabilities			4,143				3,641
Restructuring liabilities			591				—
Current portion of long-term debt			9,633				—
Current portion of deferred revenue			558				6,811
Total current liabilities			35,503				27,593
Long-term debt, net of current portion			278,661				54,556
Operating lease liabilities, net of current portion			11,934				15,266
Other long-term liabilities			279				805
Deferred revenue, net of current portion			236				277
Total liabilities			326,613				98,497
Stockholders' equity:
Common stock, $0.001 par value			25				23
Additional paid-in capital			351,422				423,759
Accumulated other comprehensive (loss) income			(39	)			3
Accumulated deficit			(362,484	)			(314,666	)
Total stockholders' equity			(11,076	)			109,119
Total liabilities and stockholders' equity		$	315,537			$	207,616
(1) We adopted ASU 2020-06 on January 1, 2021 using modified retrospective transition method and accounted for our convertible notes due 2026, or the 2019 Notes, on a whole-instrument basis. Upon adoption, we no longer had unamortized debt discount related to the equity component of the 2019 Notes. The condensed consolidated financial statements as of March 31, 2021, June 30, 2021, September 30, 2021, and December 31, 2021 are presented under ASU 2020-06, while comparative prior reporting period presented is not adjusted and continue to be reported in accordance with our historical accounting policy.

IMPINJ, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data, unaudited)
		Three Months Ended								Year Ended
		December 31,								December 31,
		2021				2020				2021				2020
Revenue		$	52,574			$	36,448			$	190,283			$	138,923
Cost of revenue			23,391				19,034				91,329				73,783
Gross profit			29,183				17,414				98,954				65,140
Operating expenses:
Research and development			17,578				14,971				64,058				48,590
Sales and marketing			9,710				8,086				34,287				28,663
General and administrative			9,125				8,743				36,137				34,958
Restructuring costs			458				—				1,721				—
Total operating expenses			36,871				31,800				136,203				112,211
Loss from operations			(7,688	)			(14,386	)			(37,249	)			(47,071	)
Other income, net			4				66				25				650
Induced conversion expense			(11,333	)			—				(11,333	)			—
Interest expense			(974	)			(1,392	)			(2,550	)			(5,413	)
Loss before income taxes			(19,991	)			(15,712	)			(51,107	)			(51,834	)
Income tax expense			(23	)			(5	)			(153	)			(89	)
Net loss		$	(20,014	)		$	(15,717	)		$	(51,260	)		$	(51,923	)
Net loss per share — basic and diluted		$	(0.81	)		$	(0.68	)		$	(2.12	)		$	(2.28	)
Weighted-average shares — basic and diluted			24,581				23,218				24,176				22,819

IMPINJ, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands, unaudited)
		Year Ended
		December 31,
		2021			2020
Operating activities:
Net loss		$	(51,260)		$	(51,923)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation			4,602			4,504
Stock-based compensation			40,498			25,675
Accretion of discount or amortization of premium on investments			896			224
Amortization of debt issuance costs and debt discount			568			3,680
Induced conversion expense related to convertible notes			11,333			—
Settlement and related costs			(460)			—
Changes in operating assets and liabilities:
Accounts receivable			(10,446)			(1,268)
Inventory			14,371			(2,176)
Prepaid expenses and other assets			(770)			(3,081)
Deferred revenue			(6,294)			6,324
Accounts payable			2,340			3,491
Accrued compensation and employee related benefits			836			(330)
Operating lease right-of-use assets			2,792			2,740
Operating lease liabilities			(3,528)			(3,380)
Accrued and other liabilities			987			(1,357)
Net cash provided by (used in) operating activities			6,465			(16,877)
Investing activities:
Purchases of investments			(84,412)			(82,735)
Proceeds from maturities of investments			82,000			49,522
Purchases of property and equipment			(16,230)			(3,074)
Net cash used in investing activities			(18,642)			(36,287)
Financing activities:
Principal payments on finance lease obligations			(2)			(257)
Proceeds from exercise of stock options and employee stock purchase plan			17,648			10,159
Proceeds from issuance of 2021 Notes, net of issuance costs			278,422			—
Payment of 2019 Notes			(183,624)			—
Net cash provided by financing activities			112,444			9,902
Net increase (decrease) in cash and cash equivalents			100,267			(43,262)
Cash and cash equivalents
Beginning of period			23,636			66,898
End of period		$	123,903		$	23,636

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements prepared and presented in accordance with U.S. generally accepted accounting principles, or GAAP, our key non-GAAP performance measures include adjusted EBITDA and non-GAAP net income (loss), as defined below. We use adjusted EBITDA and non-GAAP net income (loss) as key measures to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operating plans. We believe these measures provide useful information for period-to-period comparisons of our business to allow investors and others to understand and evaluate our operating results in the same manner as our management and board of directors. Our presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP, and our non-GAAP measures may be different from similarly termed non-GAAP measures used by other companies.

Adjusted EBITDA

We define adjusted EBITDA as net income (loss) determined in accordance with GAAP, excluding, if applicable for the periods presented, the effects of stock-based compensation; depreciation; investigation costs; restructuring costs; settlement and related costs; other income, net; interest expense; loss on debt extinguishment; and income tax benefit (expense). In second-quarter 2020, we revised our definition of adjusted EBITDA to exclude litigation settlement costs for the class-action and derivative lawsuits, including related costs. In fourth-quarter 2021, we revised our definition of adjusted EBITDA to exclude the expense incurred in connection with the November 2021 induced conversion of our 2019 Notes. We have excluded these costs and expenses because we do not believe they reflect our core operations and us excluding them enables more consistent evaluation of our operating performance. Excluding settlement and related costs did not impact non-GAAP net income (loss) previously reported for prior periods preceding the revision.

Non-GAAP Net Income (Loss)

We define non-GAAP net income (loss) as net income (loss), excluding, if applicable for the periods presented, the effects of stock-based compensation; depreciation; investigation costs; restructuring costs; settlement and related costs; amortization of debt discount related to the equity component of our convertible notes; and prepayment penalty on debt extinguishment. In second-quarter 2020, we revised our definition of non-GAAP net income (loss) to exclude litigation settlement costs for the class-action and derivative lawsuits, including related costs. Excluding settlement and related costs did not impact non-GAAP net income (loss) previously reported for prior periods preceding the revision. In fourth-quarter 2021, we revised our definition of non-GAAP net income (loss) to exclude the expense incurred in connection with the November 2021 induced conversion of our 2019 Notes.

GAAP requires that certain convertible debt instruments that may be settled in cash on conversion be accounted for as separate liability and equity components in a manner that reflects our non-convertible debt borrowing rate. This accounting results in the debt component being treated as though it was issued at a discount, with the debt discount being amortized as additional non-cash interest expense over the debt instrument term using the effective interest method. As a result, we believe that excluding this non-cash interest expense attributable to the debt discount in calculating our non-GAAP net income (loss) is useful because this interest expense is not indicative of our ongoing operational performance.

IMPINJ, INC. RECONCILIATIONS OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES (in thousands, except percentages, unaudited)
		Three Months Ended								Year Ended
		December 31,								December 31,
		2021				2020				2021				2020
GAAP Gross margin			55.5	%			47.8	%			52.0	%			46.9	%
Adjustments:
Depreciation			1.6	%			1.4	%			1.2	%			1.4	%
Stock-based compensation			1.1	%			1.2	%			1.0	%			0.7	%
Non-GAAP Gross margin			58.2	%			50.4	%			54.2	%			49.0	%
GAAP Net loss		$	(20,014	)		$	(15,717	)		$	(51,260	)		$	(51,923	)
Adjustments:
Depreciation			1,431				1,102				4,602				4,504
Stock-based compensation			11,547				10,174				40,498				25,675
Other income, net			(4	)			(66	)			(25	)			(650	)
Interest expense			974				1,392				2,550				5,413
Income tax expense			23				5				153				89
Settlement and related costs			(460	)			—				(460	)			5,359
Restructuring costs			458				—				1,721				—
Induced conversion expense			11,333				—				11,333				—
Adjusted EBITDA		$	5,288			$	(3,110	)		$	9,112			$	(11,533	)
GAAP Net loss		$	(20,014	)		$	(15,717	)		$	(51,260	)		$	(51,923	)
Adjustments:
Depreciation			1,431				1,102				4,602				4,504
Stock-based compensation			11,547				10,174				40,498				25,675
Amortization of debt discount			—				929				—				3,566
Settlement and related costs			(460	)			—				(460	)			5,359
Restructuring costs			458				—				1,721				—
Induced conversion expense			11,333				—				11,333				—
Non-GAAP Net income (loss)		$	4,295			$	(3,512	)		$	6,434			$	(12,819	)
Non-GAAP Net income (loss) per share:
Basic		$	0.17			$	(0.15	)		$	0.27			$	(0.56	)
Diluted		$	0.16			$	(0.15	)		$	0.25			$	(0.56	)
GAAP and non-GAAP Weighted-average shares — basic			24,581				23,218				24,176				22,819
GAAP Weighted-average shares — diluted			24,581				23,218				24,176				22,819
Dilutive shares from stock plans			2,195				—				1,768				—
Non-GAAP Weighted-average shares — diluted			26,776				23,218				25,944				22,819

IMPINJ, INC. RECONCILIATIONS OF GAAP FINANCIAL OUTLOOK TO NON-GAAP FINANCIAL OUTLOOK (in thousands, except per share data, unaudited – calculated at the midpoint of the outlook range)
		Three Months Ending
		March 31,
		2022
GAAP Net loss		$	(13,845	)
Adjustments:
Forecasted Depreciation			1,630
Forecasted Stock-based compensation			11,800
Forecasted Interest expense			1,260
Forecasted Other income, net			(50	)
Forecasted Income tax expense			30
Adjusted EBITDA		$	825
GAAP Net loss		$	(13,845	)
Adjustments:
Forecasted Depreciation			1,630
Forecasted Stock-based compensation			11,800
Non-GAAP Net loss		$	(415	)
GAAP Net loss per share — basic and diluted		$	(0.55	)
Non-GAAP Net loss per share — basic and diluted		$	(0.02	)
GAAP and Non-GAAP weighted-average shares — basic and diluted			25,000

 

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Investor Relations

Andy Cobb, CFA

Vice President, Strategic Finance

+1-206-315-4470

ir@impinj.com

Media Relations

Jill West

Vice President, Strategic Communications

+1 206-834-1110

jwest@impinj.com

Source: Impinj, Inc.

FAQ

What were Impinj's Q4 2021 revenue results?

Impinj reported Q4 2021 revenue of $52.6 million.

How did Impinj perform financially in 2021?

Impinj achieved full year revenue of $190.3 million but incurred a GAAP net loss of $51.3 million.

What is Impinj's adjusted EBITDA for Q4 2021?

The adjusted EBITDA for Q4 2021 was $5.3 million.

What guidance did Impinj provide for Q1 2022?

Impinj's Q1 2022 guidance reflects current market conditions, with expectations that actual results may vary.