Stem Announces First Quarter 2024 Results
Stem, Inc. announced its Q1 2024 results, highlighting a 42% increase in CARR-to-ARR conversion, the launch of a new PowerTrack APM suite, and reaffirmation of 2024 guidance. The financials showed a revenue decrease to $25.5 million, a net loss of $72.3 million, and operating cash flow improvement. Stem also reported booked contracts of $23.8 million, a contracted backlog of $1.6 billion, and a focus on higher-margin contracts.
42% increase in CARR-to-ARR conversion expected for 2Q24 through 4Q24
Launch of PowerTrack APM suite for efficient asset management
Reaffirmation of guidance for full year 2024 including adjusted EBITDA and operating cash flow
Revenue decrease to $25.5 million from $67.4 million in 1Q23
Net loss of $72.3 million compared to $44.8 million in 1Q23
Contracted backlog decrease to $1.6 billion from $1.9 billion in 4Q23
Insights
Stem's first-quarter results show a sharp decline in revenue, with a
An investor might appreciate the company's proactive steps to improve the profitability profile of its backlog by canceling lower-margin contracts. Additionally, the
From a market perspective, Stem's strategy shift, focusing on large-scale utility projects, has resulted in increased 'quarterly variability' in bookings, which slumped to
The
Stem's introduction of the PowerTrack™ APM suite is a strategic move to strengthen its product offering and capitalize on the growing demand for energy asset management solutions. By leveraging the Athena platform and tailoring the software for storage and solar industry professionals, Stem is positioning itself at the forefront of innovative solutions. However, it is critical to note that success hinges on market adoption and the competitive landscape of tech-driven energy management systems.
Investors should also consider the potential long-term benefits of Stem's decision to cancel less profitable contracts as an effort to focus on higher-margin opportunities. If successful, this could improve gross margins and operating cash flow. Yet, it's essential to understand that these strategic shifts often come with short-term costs and reduced revenue visibility, which can impact stock performance.
Substantial increase of +
Introducing Next Generation Asset Performance Management Software Suite
Reaffirming Full Year 2024 Operating Cash Flow, Adjusted EBITDA, Gross Margin and Bookings Guidance
First Quarter 2024 Financial and Operating Highlights
Financial Highlights1
-
Revenue of
$25.5 million $67.4 million 62% ) in 1Q23. Reflects a$33 million -
GAAP gross profit of
$(24.2) million $1.0 million -
Non-GAAP gross margin of
24% , up from19% in 1Q23 -
Net loss of
$72.3 million $44.8 million -
Adjusted EBITDA of
$(12.2) million $(13.7) million -
Operating cash flow of
$(0.6) million $(35.8) million -
Ended 1Q24 with
$112.8 million $113.6 million - Reaffirming guidance for adjusted EBITDA and operating cash flow for full year 2024
Operating Highlights
-
Bookings of
$23.8 million $363.5 million -
Contracted backlog of
$1.6 billion $1.2 billion 33% ) at end of 1Q23, and down from$1.9 billion 16% ) at end of 4Q23. Sequential decrease driven by efforts to upgrade profitability of the backlog and focus on higher-margin contracts -
Contracted storage assets under management (“AUM”) of 5.8 gigawatt hours (“GWh”), up from 5.5 GWh (+
5% ) at end of 4Q23 -
Solar monitoring AUM of 26.9 gigawatts (“GW”), down from 27.5 GW (-
2% ) at the end of 4Q23 -
Contracted annual recurring revenue (“CARR”) of
$89.3 million $71.5 million 25% ) at end of 1Q23, and down from$91.0 million 2% ) at end of 4Q23
John Carrington, Chief Executive Officer of Stem, commented, “The first quarter represented Stem’s continuing efforts to maximize cash flow generation in 2024 through cost control and converting receivables to cash. We set a quarterly record for non-GAAP gross margin, and adjusted EBITDA improved year-over-year despite lower revenue in the quarter, highlighting our focus on operating efficiency and ongoing cost management. Our first quarter performance reflected breakeven operating cash flow given continued reductions in our working capital intensity. Importantly, we are accelerating the conversion of CARR-to-ARR with a +
“Revenue in the first quarter was reduced by a
“During the quarter, we also canceled certain less profitable contracts in both our hardware and software backlog to focus on higher-margin opportunities. We believe that these decisions will set us up for improved profitability and cash generation in the future. We remain confident in our ability to generate more than
“I am excited to announce our new PowerTrackTM Asset Performance Management (APM) suite, a software solution that centralizes and streamlines the management of storage, solar, and hybrid energy asset portfolios. Built on the dual foundation of Stem’s solar asset monitoring software and the Athena platform, PowerTrack APM revolutionizes how technical asset managers, commercial asset managers, and operations managers collaborate around a unified set of metrics and streamlined processes. PowerTrack APM was built by storage and solar industry experts to surface the right insights at the right time to reduce operational risk and maximize asset and portfolio performance.
“As we expected with our expansion into large-scale front-of-the-meter (FTM) storage projects, our bookings have become increasingly variable on a quarterly basis. We reiterate our full-year
___________________
1 The Company recorded a net revenue reduction of
Key Financial Results and Operating Metrics |
|||||||
(in $ millions unless otherwise noted): |
|||||||
|
Three Months Ended March 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Key Financial Results(1) |
|
|
|
||||
Revenue |
$ |
25.5 |
|
|
$ |
67.4 |
|
GAAP Gross (Loss) Profit |
$ |
(24.2 |
) |
|
$ |
1.0 |
|
GAAP Gross Margin (%) |
|
(95 |
)% |
|
|
1 |
% |
Non-GAAP Gross Profit* |
$ |
13.8 |
|
|
$ |
15.1 |
|
Non-GAAP Gross Margin (%)* |
|
24 |
% |
|
|
19 |
% |
Net Loss |
$ |
(72.3 |
) |
|
$ |
(44.8 |
) |
Adjusted EBITDA* |
$ |
(12.2 |
) |
|
$ |
(13.7 |
) |
|
|
|
|
||||
Key Operating Metrics |
|
|
|
||||
Bookings |
$ |
23.8 |
|
|
$ |
363.5 |
|
Contracted Backlog** |
$ |
1,639.6 |
|
|
$ |
1,242.6 |
|
Contracted Storage AUM (in GWh)** |
|
5.8 |
|
|
|
3.5 |
|
Solar Monitoring AUM (in GW)** |
|
26.9 |
|
|
|
25.6 |
|
CARR** |
$ |
89.3 |
|
|
$ |
71.5 |
|
(1) Revenue, gross (loss) profit, and net loss were negatively impacted by a
*Non-GAAP financial measures. Adjusted EBITDA and non-GAAP gross profit and margin have been adjusted to exclude the impact of the reduction in revenue, as discussed below. See the section below titled “Use of Non-GAAP Financial Measures” for details and the section below titled “Reconciliations of Non-GAAP Financial Measures” for reconciliations.
** At period end.
First Quarter 2024 Financial and Operating Results
Financial Results
Revenue decreased
GAAP gross (loss) profit was
Non-GAAP gross profit was
Net loss was
Adjusted EBITDA was
The Company ended the quarter with
Operating Results
Contracted backlog was
Bookings were
Contracted storage AUM increased
CARR decreased
The following table provides a summary of backlog at the end of the first quarter of 2024, compared to backlog at the end of the fourth quarter of 2023 ($ in millions):
End of 4Q23 |
$ |
1,929.3 |
|
Add: Bookings |
|
23.8 |
|
Less: Hardware revenue |
|
(43.7 |
) |
Software/services adjustments |
|
(13.1 |
) |
Amendments/Cancellations |
|
(256.7 |
) |
End of 1Q24 |
$ |
1,639.6 |
|
Recent Business Highlights
On March 19, 2024, the Company announced that its Athena® PowerBidder™ Pro application had been selected by two community choice aggregators (CCAs) – Central Coast Community Energy and Silicon Valley Clean Energy – to support scalable bid optimization management and help maximize the value of multiple battery energy storage systems in the California Independent System Operator (CAISO) market. Under this software-only contract, the CCAs will use PowerBidder Pro’s advanced price forecasting and optimization features to manage and execute trading strategies for a growing portfolio of utility-scale assets in CAISO.
On May 2, 2024, the Company announced the launch of its new PowerTrack Asset Performance Management (APM) suite, a powerful software solution enabling owners, operators, and asset managers to centralize and streamline the management of storage, solar, and hybrid energy asset portfolios. The suite includes highly configurable, persona-based dashboards and workflows, allowing users to create and customize the interface and data that matter most. From portfolio-level technical and commercial performance monitoring to site-level information and granular device-level data, PowerTrack APM offers simplified and automated processes to help drive operational efficiency and help ensure hardware compliance as companies scale their clean energy portfolios.
Outlook
The Company is updating its full year 2024 guidance ranges as follows ($ millions, unless otherwise noted):
|
Previous |
Updated* |
Revenue |
|
|
|
|
|
Non-GAAP Gross Margin (%) |
|
Unchanged |
|
|
|
Adjusted EBITDA |
|
Unchanged |
|
|
|
Bookings |
|
Unchanged |
|
|
|
CARR (year-end) |
|
Unchanged |
|
|
|
Operating Cash Flow |
Greater than |
Unchanged |
See the section below titled “Reconciliations of Non-GAAP Financial Measures” for information regarding why Stem is unable to reconcile Non-GAAP Gross Margin and Adjusted EBITDA guidance to their most comparable financial measures calculated in accordance with GAAP.
*Full year revenue guidance has been adjusted downward dollar-for-dollar solely as a result of the
The Company reaffirms full year 2024 revenue projected quarterly performance as follows:
|
1QA |
2QE |
3QE |
4QE |
Revenue |
|
|
|
|
Some Factors Affecting our Business and Operations
As previously disclosed, the Company entered into certain contractual guarantees pursuant to which, if a customer were unable to install or designate hardware to a specified project within a specified period of time, the Company would be required to assist the customer in re-marketing the hardware for resale by the customer. Such guarantees provide that, in such cases, if the customer resold the hardware for less than the amount initially sold to the customer, the Company would be required to compensate the customer for any shortfall in fair value for the hardware from the initial contract price. The Company accounts for specified contractual guarantees as variable consideration. The Company reviews its estimate of variable consideration, including changes in estimates related to such guarantees, each quarter for facts or circumstances that have changed from the time of the initial estimate. Due to recent market conditions, recorded a net revenue reduction of
The Company has not issued such guarantees since June 2023, and does not intend to issue any new guarantees in the future.
The Company is actively advancing projects under fixed price contracts that it expects will consume approximately
Stem continues to diversify its supply chain, integrate additional energy technologies, and deploy a portion of its balance sheet to help position the Company to meet the expected significant growth in customer demand. We are subject to risk and exposure from the evolving macroeconomic, geopolitical and business environment, including the effects of increased global inflationary pressures and interest rates, potential import tariffs, potential economic slowdowns or recessions, and geopolitical pressures, including the armed conflicts between
Use of Non-GAAP Financial Measures
In addition to financial results determined in accordance with
We use these non-GAAP financial measures for financial and operational decision-making and to evaluate our operating performance and prospects, develop internal budgets and financial goals, and to facilitate period-to-period comparisons. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses and expenditures that may not be indicative of our operating performance, such as stock-based compensation and other non-cash charges, as well as discrete cash charges that are infrequent in nature. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to our historical performance and liquidity as well as comparisons to our competitors’ operating results, to the extent that competitors define these metrics in the same manner that we do. We believe these non-GAAP financial measures are useful to investors both because they (1) allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) are used by investors and analysts to help them analyze the health of our business. Our calculation of these non-GAAP financial measures may differ from similarly-titled non-GAAP measures, if any, reported by other companies. In addition, other companies may not publish these or similar measures. These non-GAAP financial measures should be considered in addition to, not as a substitute for, or superior to, other measures of financial performance prepared in accordance with GAAP. For reconciliation of adjusted EBITDA and non-GAAP gross profit and margin to their most comparable GAAP measures, see the section below entitled “Reconciliations of Non-GAAP Financial Measures.”
Definitions of Non-GAAP Financial Measures
We define adjusted EBITDA as net income (loss) attributable to Stem before depreciation and amortization, including amortization of internally developed software, net interest expense, further adjusted to exclude stock-based compensation and other income and expense items, including gain (loss) on the extinguishment of debt, revenue constraint, reduction in revenue, excess supplier costs, change in fair value of derivative liability, transaction and acquisition-related charges, litigation expense, restructuring costs, and income tax provision or benefit. The expenses and other items that we exclude in our calculation of adjusted EBITDA may differ from the expenses and other items, if any, that other companies may exclude when calculating adjusted EBITDA.
We define non-GAAP gross profit as gross profit excluding amortization of capitalized software, impairments related to decommissioning of end-of-life systems, excess supplier costs, reduction in revenue, and including revenue constraint. Non-GAAP gross margin is defined as non-GAAP gross profit as a percentage of revenue.
The Company generally records the full purchase order value as revenue at the time of hardware delivery; however, for certain non-cancelable purchase orders entered into during the first quarter of 2023, the final settlement amount payable to the Company is variable and indexed to the price per ton of lithium carbonate in the first quarter of 2024 such that the Company may increase or decrease the final prices in such purchase orders based on the price per ton of lithium carbonate at final settlement. Lithium carbonate is a key raw material used in the production of hardware systems that the Company ultimately sells to customers. The total dollar amount of such purchase orders for the indexed contracts is approximately
As stated above, in certain customer contracts, the Company previously agreed to provide a guarantee that the value of purchased hardware will not decline for a certain period of time. The Company accounts for such contractual terms and guarantees as variable consideration at each measurement date. The Company reviews its estimate of variable consideration each quarter, including changes in estimates related to such guarantees, for facts or circumstances that have changed from the time of the initial estimate.
See the section below entitled “Reconciliations of Non-GAAP Financial Measures.”
Conference Call Information
Stem will hold a conference call to discuss this earnings press release and business outlook on Thursday, May 2, 2024, beginning at 5:00 p.m. Eastern Time. The conference call and accompanying slides may be accessed via a live webcast on a listen-only basis on the Events & Presentations page of the Investor Relations section of the Company’s website at https://investors.stem.com/events-and-presentations. The call can also be accessed live over the telephone by dialing (877) 407-3982, or for international callers, (201) 493-6780 and referencing Stem. An audio replay will be available shortly after the call until June 2, 2024, and can be accessed by dialing (844) 512-2921 or for international callers by dialing (412) 317-6671. The passcode for the replay is 13745401. The replay will be available until Sunday, June 2, 2024. An archive of the webcast will be available shortly after the call on Stem’s website at https://investors.stem.com/overview for 12 months following the call.
About Stem
Stem provides clean energy solutions and services designed to maximize the economic, environmental, and resiliency value of energy assets and portfolios. Stem’s leading AI-driven enterprise software platform, Athena® enables organizations to deploy and unlock value from clean energy assets at scale. Powerful applications, including AlsoEnergy’s PowerTrack, simplify and optimize asset management and connect an ecosystem of owners, developers, assets, and markets. Stem also offers integrated partner solutions to help improve returns across energy projects, including storage, solar, and EV fleet charging. For more information, visit www.stem.com.
Forward-Looking Statements
This earnings press release, as well as other statements we make, contains “forward-looking statements” within the meaning of the federal securities laws, which include any statements that are not historical facts. Such statements often contain words such as “expect,” “may,” “can,” “believe,” “predict,” “plan,” “potential,” “projected,” “projections,” “forecast,” “estimate,” “intend,” “anticipate,” “ambition,” “goal,” “target,” “think,” “should,” “could,” “would,” “will,” “hope,” “see,” “likely,” and other similar words. Forward-looking statements address matters that are, to varying degrees, uncertain, such as statements about our financial and performance targets and other forecasts or expectations regarding, or dependent on, our business outlook; our expectations around future estimates of variable consideration in connection with guarantees of certain customer contracts, and the resulting effects on revenue; our ability to secure sufficient and timely inventory from suppliers; our ability to meet contracted customer demand; our ability to manage our supply chains and distribution channels; our joint ventures, partnerships and other alliances; forecasts or expectations regarding energy transition and global climate change; reduction of greenhouse gas (“GHG”) emissions; the integration and optimization of energy resources; our business strategies and those of our customers; our ability to retain or upgrade current customers, further penetrate existing markets or expand into new markets; our ability to manage our supply chains and distribution channels; the effects of natural disasters and other events beyond our control; the direct or indirect effects on our business of macroeconomic factors and geopolitical instability, such as the ongoing conflict in
Source: Stem, Inc.
STEM, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share and per share amounts) |
|||||||
|
March 31, 2024 |
|
December 31, 2023 |
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
112,804 |
|
|
$ |
105,375 |
|
Short-term investments |
|
— |
|
|
|
8,219 |
|
Accounts receivable, net of allowances of |
|
239,934 |
|
|
|
302,848 |
|
Inventory, net |
|
24,444 |
|
|
|
26,665 |
|
Deferred costs with suppliers |
|
20,125 |
|
|
|
20,555 |
|
Other current assets (includes |
|
8,221 |
|
|
|
9,303 |
|
Total current assets |
|
405,528 |
|
|
|
472,965 |
|
Energy storage systems, net |
|
71,234 |
|
|
|
74,418 |
|
Contract origination costs, net |
|
10,515 |
|
|
|
11,119 |
|
Goodwill |
|
547,169 |
|
|
|
547,205 |
|
Intangible assets, net |
|
155,008 |
|
|
|
157,146 |
|
Operating lease right-of-use assets |
|
11,475 |
|
|
|
12,255 |
|
Other noncurrent assets |
|
83,966 |
|
|
|
81,869 |
|
Total assets |
$ |
1,284,895 |
|
|
$ |
1,356,977 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
61,746 |
|
|
$ |
78,277 |
|
Accrued liabilities |
|
78,487 |
|
|
|
76,873 |
|
Accrued payroll |
|
11,188 |
|
|
|
14,372 |
|
Financing obligation, current portion |
|
15,390 |
|
|
|
14,835 |
|
Deferred revenue, current portion |
|
56,952 |
|
|
|
53,997 |
|
Other current liabilities (includes |
|
12,855 |
|
|
|
12,726 |
|
Total current liabilities |
|
236,618 |
|
|
|
251,080 |
|
Deferred revenue, noncurrent |
|
88,410 |
|
|
|
88,650 |
|
Asset retirement obligation |
|
4,073 |
|
|
|
4,052 |
|
Convertible notes, noncurrent |
|
524,200 |
|
|
|
523,633 |
|
Financing obligation, noncurrent |
|
49,222 |
|
|
|
52,010 |
|
Lease liabilities, noncurrent |
|
9,885 |
|
|
|
10,455 |
|
Other liabilities |
|
436 |
|
|
|
416 |
|
Total liabilities |
|
912,844 |
|
|
|
930,296 |
|
Stockholders’ equity: |
|
|
|
||||
Preferred stock, |
|
— |
|
|
|
— |
|
Common stock, |
|
16 |
|
|
|
16 |
|
Additional paid-in capital |
|
1,216,197 |
|
|
|
1,198,716 |
|
Accumulated other comprehensive income (loss) |
|
154 |
|
|
|
(42 |
) |
Accumulated deficit |
|
(844,801 |
) |
|
|
(772,494 |
) |
Total Stem’s stockholders’ equity |
|
371,566 |
|
|
|
426,196 |
|
Non-controlling interests |
|
485 |
|
|
|
485 |
|
Total stockholders’ equity |
|
372,051 |
|
|
|
426,681 |
|
Total liabilities and stockholders’ equity |
$ |
1,284,895 |
|
|
$ |
1,356,977 |
|
STEM, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except share and per share amounts) |
|||||||
|
Three Months Ended
|
||||||
|
|
2024 |
|
|
|
2023 |
|
Revenue |
|
|
|
||||
Services and other revenue |
$ |
14,840 |
|
|
$ |
14,673 |
|
Hardware revenue |
|
10,629 |
|
|
|
52,732 |
|
Total revenue |
|
25,469 |
|
|
|
67,405 |
|
Cost of revenue |
|
|
|
||||
Cost of services and other revenue |
|
9,984 |
|
|
|
11,504 |
|
Cost of hardware revenue |
|
39,676 |
|
|
|
54,907 |
|
Total cost of revenue |
|
49,660 |
|
|
|
66,411 |
|
Gross (loss) profit |
|
(24,191 |
) |
|
|
994 |
|
Operating expenses: |
|
|
|
||||
Sales and marketing |
|
11,126 |
|
|
|
12,406 |
|
Research and development |
|
14,136 |
|
|
|
13,444 |
|
General and administrative |
|
18,560 |
|
|
|
17,797 |
|
Total operating expenses |
|
43,822 |
|
|
|
43,647 |
|
Loss from operations |
|
(68,013 |
) |
|
|
(42,653 |
) |
Other expense, net: |
|
|
|
||||
Interest expense, net |
|
(4,707 |
) |
|
|
(1,777 |
) |
Other income (expense), net |
|
566 |
|
|
|
(439 |
) |
Total other expense, net |
|
(4,141 |
) |
|
|
(2,216 |
) |
Loss before (provision for) benefit from income taxes |
|
(72,154 |
) |
|
|
(44,869 |
) |
(Provision for) benefit from income taxes |
|
(153 |
) |
|
|
91 |
|
Net loss |
$ |
(72,307 |
) |
|
$ |
(44,778 |
) |
|
|
|
|
||||
Net loss per share attributable to common stockholders, basic and diluted |
$ |
(0.46 |
) |
|
$ |
(0.29 |
) |
|
|
|
|
||||
Weighted-average shares used in computing net loss per share to common stockholders, basic and diluted |
|
158,180,137 |
|
|
|
154,966,163 |
|
STEM, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) |
|||||||
|
Three Months Ended
|
||||||
|
|
2024 |
|
|
|
2023 |
|
OPERATING ACTIVITIES |
|
|
|
||||
Net loss |
$ |
(72,307 |
) |
|
$ |
(44,778 |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
||||
Depreciation and amortization expense |
|
10,809 |
|
|
|
11,107 |
|
Non-cash interest expense, including interest expenses associated with debt issuance costs |
|
422 |
|
|
|
386 |
|
Stock-based compensation |
|
8,374 |
|
|
|
7,202 |
|
Non-cash lease expense |
|
777 |
|
|
|
661 |
|
Accretion of asset retirement obligations |
|
59 |
|
|
|
61 |
|
Impairment loss of energy storage systems |
|
— |
|
|
|
851 |
|
Impairment loss of project assets |
|
345 |
|
|
|
— |
|
Net (accretion of discount) amortization of premium on investments |
|
(29 |
) |
|
|
(657 |
) |
Income tax benefit from release of valuation allowance |
|
— |
|
|
|
(335 |
) |
Provision for accounts receivable allowance |
|
(1,004 |
) |
|
|
522 |
|
Net loss on investments |
|
— |
|
|
|
1,561 |
|
Other |
|
(98 |
) |
|
|
(117 |
) |
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
63,943 |
|
|
|
(10,067 |
) |
Inventory |
|
2,221 |
|
|
|
(34,857 |
) |
Deferred costs with suppliers |
|
430 |
|
|
|
28,179 |
|
Other assets |
|
(1,176 |
) |
|
|
251 |
|
Contract origination costs, net |
|
(356 |
) |
|
|
(802 |
) |
Project assets |
|
(390 |
) |
|
|
(1,402 |
) |
Accounts payable |
|
(16,280 |
) |
|
|
28,831 |
|
Accrued expenses and other liabilities |
|
1,731 |
|
|
|
(31,746 |
) |
Deferred revenue |
|
2,715 |
|
|
|
9,921 |
|
Lease liabilities |
|
(807 |
) |
|
|
(593 |
) |
Net cash used in operating activities |
|
(621 |
) |
|
|
(35,821 |
) |
INVESTING ACTIVITIES |
|
|
|
||||
Acquisitions, net of cash acquired |
|
— |
|
|
|
(1,847 |
) |
Purchase of available-for-sale investments |
|
— |
|
|
|
(49,152 |
) |
Proceeds from maturities of available-for-sale investments |
|
8,250 |
|
|
|
50,270 |
|
Proceeds from sales of available-for-sale investments |
|
— |
|
|
|
73,917 |
|
Purchase of energy storage systems |
|
(51 |
) |
|
|
(1,625 |
) |
Capital expenditures on internally-developed software |
|
(3,463 |
) |
|
|
(3,570 |
) |
Purchase of property and equipment |
|
(61 |
) |
|
|
(162 |
) |
Net cash provided by investing activities |
|
4,675 |
|
|
|
67,831 |
|
FINANCING ACTIVITIES |
|
|
|
||||
Proceeds from exercise of stock options and warrants |
|
— |
|
|
|
149 |
|
Proceeds from employee equity transactions to be remitted to tax authorities, net |
|
5,228 |
|
|
|
— |
|
Repayment of financing obligations |
|
(2,086 |
) |
|
|
(2,133 |
) |
Redemption of investment from non-controlling interests, net |
|
— |
|
|
|
(72 |
) |
Repayment of notes payable |
|
— |
|
|
|
(100 |
) |
Net cash provided by (used in) financing activities |
|
3,142 |
|
|
|
(2,156 |
) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
233 |
|
|
|
126 |
|
Net increase in cash, cash equivalents and restricted cash |
|
7,429 |
|
|
|
29,980 |
|
Cash, cash equivalents and restricted cash, beginning of year |
|
106,475 |
|
|
|
87,903 |
|
Cash, cash equivalents and restricted cash, end of period |
$ |
113,904 |
|
|
$ |
117,883 |
|
|
|
|
|
||||
RECONCILIATION OF CASH, CASH EQUIVALENTS, AND RESTRICTED CASH WITHIN THE CONDENSED CONSOLIDATED BALANCE SHEETS TO THE AMOUNTS SHOWN IN THE STATEMENTS OF CASH FLOWS ABOVE: |
|
|
|
||||
Cash and cash equivalents |
$ |
112,804 |
|
|
$ |
117,883 |
|
Restricted cash included in other noncurrent assets |
|
1,100 |
|
|
|
— |
|
Total cash, cash equivalents, and restricted cash |
$ |
113,904 |
|
|
$ |
117,883 |
|
STEM, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) |
|||||||
The following table provides a reconciliation of adjusted EBITDA to net loss: |
|||||||
|
Three Months Ended March 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
|
(in thousands) |
||||||
Net loss |
$ |
(72,307 |
) |
|
$ |
(44,778 |
) |
Adjusted to exclude the following: |
|
|
|
||||
Depreciation and amortization (1) |
|
11,154 |
|
|
|
11,958 |
|
Interest expense, net |
|
4,707 |
|
|
|
1,777 |
|
Stock-based compensation |
|
8,374 |
|
|
|
7,202 |
|
Revenue constraint (2) |
|
— |
|
|
|
10,200 |
|
Revenue reduction, net (3) |
|
33,128 |
|
|
|
— |
|
Excess supplier costs (4) |
|
1,012 |
|
|
|
— |
|
Provision for (benefit from) income taxes |
|
153 |
|
|
|
(91 |
) |
Other expenses (5) |
|
1,540 |
|
|
|
— |
|
Adjusted EBITDA |
$ |
(12,239 |
) |
|
$ |
(13,732 |
) |
Adjusted EBITDA, as used in the Company's full year 2024 guidance, is a non-GAAP financial measure that excludes or has otherwise been adjusted for items impacting comparability. The Company is unable to reconcile projected adjusted EBITDA to net income (loss), its most directly comparable forward-looking GAAP financial measure, without unreasonable effort, because the Company is unable to predict with a reasonable degree of certainty its change in stock-based compensation expense, depreciation and amortization expense, revenue constraint and other items that may affect net loss. The unavailable information could have a significant effect on the Company’s full year 2024 GAAP financial results.
(1) Depreciation and amortization includes depreciation and amortization expense, impairment loss of energy storage systems, and impairment loss of project assets.
(2) Refer to the discussion of revenue constraint in the definition of non-GAAP gross profit provided above.
(3) Refer to the discussion of reduction in revenue in the definition of non-GAAP gross profit provided above.
(4) Refer to the discussion of excess supplier costs in the definition of non-GAAP gross profit provided above.
(5) Adjusted EBITDA for the three months ended March 31, 2024 reflects other expenses of
The following table provides a reconciliation of non-GAAP gross profit and margin to GAAP gross profit and margin ($ in millions): |
|||||||
|
Three Months Ended March 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Revenue |
$ |
25.5 |
|
|
$ |
67.4 |
|
Cost of revenue |
|
(49.7 |
) |
|
|
(66.4 |
) |
GAAP gross (loss) profit |
|
(24.2 |
) |
|
|
1.0 |
|
GAAP gross margin (%) |
|
(95 |
)% |
|
|
1 |
% |
|
|
|
|
||||
Non-GAAP Gross Profit |
|
|
|
||||
GAAP Revenue |
$ |
25.5 |
|
|
$ |
67.4 |
|
Add: Revenue constraint (1) |
|
— |
|
|
|
10.2 |
|
Add: Revenue reduction, net (2) |
|
33.1 |
|
|
|
— |
|
Subtotal |
|
58.6 |
|
|
|
77.6 |
|
Less: Cost of revenue |
|
(49.7 |
) |
|
|
(66.4 |
) |
Add: Amortization of capitalized software & developed technology |
|
3.9 |
|
|
|
3.0 |
|
Add: Impairments |
|
— |
|
|
|
0.9 |
|
Add: Excess supplier costs (3) |
|
1.0 |
|
|
|
— |
|
Non-GAAP gross profit |
$ |
13.8 |
|
|
$ |
15.1 |
|
Non-GAAP gross margin (%) |
|
24 |
% |
|
|
19 |
% |
Non-GAAP gross margin as used in the Company's full year 2024 guidance, is a non-GAAP financial measure that excludes or has otherwise been adjusted for items impacting comparability. The Company is unable to reconcile projected non-GAAP gross margin to GAAP gross margin, its most directly comparable forward-looking GAAP financial measure, without unreasonable efforts, because the Company is currently unable to predict with a reasonable degree of certainty its change in amortization of capitalized software, impairments, and other items that may affect GAAP gross margin. The unavailable information could have a significant effect on the Company’s full year 2024 GAAP financial results.
(1) Refer to the discussion of revenue constraint in the definition of non-GAAP profit provided above.
(2) Refer to the discussion of reduction in revenue in the definition of non-GAAP profit provided above.
(3) Refer to the discussion of excess supplier costs in the definition of non-GAAP profit provided above.
Key Definitions:
Item |
Definition |
Bookings |
Total value of executed customer agreements, as of the end of the relevant period (e.g. quarterly bookings or annual bookings)
|
Contracted Backlog |
Total value of bookings in dollars, as of a specific date
|
Contracted Assets Under Management (“AUM”) |
Total GWh of storage systems in operation or under contract |
Solar Monitoring AUM |
Total GW of solar systems in operation or under contract |
Contracted Annual Recurring Revenue (CARR) |
Annual run rate for all executed software services contracts, including contracts signed in the applicable period for systems that are not yet commissioned or operating |
Project Services |
Professional services and revenue tied to Development Company investments |
Operating Cash Flow |
Net cash provided by (used in) operating activities. Does not represent the change in balance sheet cash which will be further impacted by investing and financing activities |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240501505631/en/
Stem Investor Contacts
Ted Durbin, Stem
Marc Silverberg, ICR
IR@stem.com
Stem Media Contacts
Suraya Akbarzad, Stem
press@stem.com
Source: Stem, Inc.
FAQ
<p>What was Stem's revenue in Q1 2024?</p>
Stem's revenue in Q1 2024 was $25.5 million, down from $67.4 million in 1Q23.
<p>What was Stem's net loss in Q1 2024?</p>
Stem reported a net loss of $72.3 million in Q1 2024, versus $44.8 million in 1Q23.
<p>What was Stem's contracted backlog at the end of Q1 2024?</p>
Stem's contracted backlog was $1.6 billion at the end of Q1 2024, down from $1.9 billion in 4Q23.
