Universal Electronics Reports Fourth Quarter and Year-End 2023 Financial Results
- UEI focused on growth areas like home automation and climate control in 2023.
- The company plans to continue its share repurchase program.
- UEI is pursuing legal action against Roku for patent infringement.
- Financially, UEI saw a decline in net sales and gross margins for Q4 and full year 2023.
- A non-cash charge affected GAAP operating income and net income for full year 2023.
- UEI expects a range of net sales and loss per share for Q1 2024.
- Decline in net sales and gross margins for Q4 and full year 2023.
- Significant non-cash charge impacting GAAP operating income and net income for full year 2023.
Insights
The reported financial results from Universal Electronics Inc. (UEI) show a significant year-over-year decline in both GAAP and Adjusted Non-GAAP net sales, with a decrease from $542.8 million in 2022 to $420.5 million in 2023. This contraction in sales reflects challenges in the market or operational aspects of the company. The reported GAAP gross margin decline from 28.1% to 23.2% and Adjusted Non-GAAP gross margins from 29.9% to 27.3% suggest margin compression, which could be due to increased costs or pricing pressures. Notably, the GAAP operating loss of $85.3 million, including a substantial goodwill impairment charge, indicates a significant reassessment of the company's future cash flow prospects, which is a red flag for investors regarding the company's valuation and growth outlook.
The forward-looking guidance for Q1 2024, with expected GAAP net sales between $86 million and $96 million compared to $108.4 million in Q1 2023, further suggests that the company anticipates continued challenges. The expected GAAP loss per share for Q1 2024 ranges from $0.88 to $0.78, which, while an improvement from the $4.81 loss per share in Q1 2023, still indicates that profitability issues persist. Investors need to consider whether the company's strategic focus on home automation and climate control, as well as efficiency initiatives, can reverse the negative trends in sales and margins.
UEI's strategic emphasis on growth areas such as home automation and climate control is aligned with broader market trends toward smart homes and energy efficiency. The company's confidence in its long-term growth and the continuation of its share repurchase program may be seen as a positive signal to the market, indicating management's belief in the intrinsic value of the company. However, the overall industry context, particularly the competitive landscape and consumer demand within the smart home technology sector, will play a crucial role in determining UEI's ability to capture market share and improve financial performance.
The recent legal victory, affirming UEI's intellectual property rights against Roku, underscores the importance of patent portfolios in the tech industry as a means of protecting innovation and potentially providing licensing revenue streams. However, the ultimate financial impact of this legal victory, including potential monetary damages from Roku, remains uncertain and should be monitored by stakeholders for its potential effect on UEI's financial position and strategic leverage within the industry.
The affirmation by the U.S. Court of Appeals for the Federal Circuit of UEI's intellectual property rights is a significant legal development. It not only validates UEI's claims against Roku but also has the potential to enhance the company's negotiating power in the industry and possibly lead to monetary compensation for past infringements. The legal process, however, can be protracted and the actual financial benefits from such litigation outcomes are often difficult to predict and may not be realized in the short term. Careful monitoring of the subsequent district court proceedings will be necessary to assess the potential impact on UEI's financials from this legal victory.
It is also worth noting that litigation outcomes can set precedents affecting industry practices. If UEI's patents are deemed particularly crucial, this could have broader implications for the competitive dynamics within the home automation and climate control sectors, potentially affecting how companies approach technology development and licensing agreements.
Paul Arling, UEI’s chairman and CEO, said, “We are building for a better future. During 2023, we successfully advanced our transformation, increasing our focus in growth areas such as home automation and climate control. We are executing our efficiency initiatives, and our strong gross margins delivered better than expected earnings per share for the fourth quarter of 2023. We believe a more efficient factory footprint coupled with project wins in the connected home channels will generate earnings growth and full year profitability. Confident in our strategy and long-term growth, we plan to continue our share repurchase program.
“Furthermore, our intellectual property is being recognized. In January 2024, the
Financial Results for the Three Months Ended December 31: 2023 Compared to 2022
-
GAAP net sales were
$97.6 million $122.8 million $97.6 million $122.8 million -
GAAP gross margins were
28.5% , compared to26.2% ; Adjusted Non-GAAP gross margins were30.2% , compared to30.7% . -
GAAP operating loss was
$2.6 million $1.9 million $1.8 million $8.3 million -
GAAP net loss was
$7.1 million $0.55 $6.9 million $0.54 $0.9 million $0.07 $5.6 million $0.44 -
At December 31, 2023, cash and cash equivalents were
$42.8 million
Financial Results for the Twelve Months Ended December 31: 2023 Compared to 2022
-
GAAP net sales were
$420.5 million $542.8 million $420.5 million $542.8 million -
GAAP gross margins were
23.2% , compared to28.1% ; Adjusted Non-GAAP gross margins were27.3% , compared to29.9% . -
GAAP operating loss was
$85.3 million $49.1 million $14.5 million $0.8 million $41.8 million -
GAAP net loss was
$98.2 million $7.64 $0.4 million $0.03 $2.3 million $0.18 $32.7 million $2.56
Financial Outlook
For the first quarter of 2024, the company expects GAAP net sales to range between
For the first quarter of 2024, the company expects Adjusted Non-GAAP net sales to range between
Conference Call Information
UEI’s management team will hold a conference call today, Thursday, February 15, 2024 at 4:30 p.m. ET / 1:30 p.m. PT, to discuss its fourth quarter and full year 2023 earnings results, review recent activity and answer questions. To attend the call please register at here to receive a computer-generated dial-in number and a unique pin number. The conference call will also be broadcast live on the investor section of the UEI website where it will be available for replay for 90 days.
Use of Non-GAAP Financial Metrics
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, UEI provides Adjusted Non-GAAP information as additional information for its operating results. References to Adjusted Non-GAAP information are to non-GAAP financial measures. These measures are not required by, in accordance with, or an alternative for, GAAP and may be different from non-GAAP financial measures used by other companies. UEI’s management uses these measures for reviewing the financial results of UEI for budget planning purposes and for making operational and financial decisions. Management believes that providing these non-GAAP financial measures to investors, as a supplement to GAAP financial measures, help investors evaluate UEI’s core operating and financial performance and business trends consistent with how management evaluates such performance and trends. Additionally, management believes these measures facilitate comparisons with the core operating and financial results and business trends of competitors and other companies.
Adjusted Non-GAAP net sales is defined as net sales. Adjusted Non-GAAP gross profit is defined as gross profit excluding the impact of excess manufacturing overhead costs, factory transition costs, impairment, stock-based compensation expense and depreciation expense related to the increase in fixed assets from cost to fair market value resulting from acquisitions. Adjusted Non-GAAP operating expenses are defined as operating expenses excluding stock-based compensation expense, amortization of intangibles acquired, costs associated with certain litigation efforts, goodwill impairment, impairment, factory restructuring costs and severance. Adjusted Non-GAAP net income is defined as net income excluding the aforementioned items, foreign currency gains and losses, the related tax effects of all adjustments, as well as a valuation allowance on certain deferred tax assets. Adjusted Non-GAAP earnings (loss) per diluted share is calculated using Adjusted Non-GAAP net income. A reconciliation of these financial measures to the most directly comparable GAAP financial measures is included at the end of this press release.
About Universal Electronics
Universal Electronics Inc. (NASDAQ: UEIC) is the global leader in wireless universal control solutions for home entertainment and smart home devices and designs, develops, manufactures, ships and supports hardware and software control and sensor technology solutions. UEI partners with many Fortune 500 customers, including Comcast, Vivint Smart Home, Samsung, LG, Sony and Daikin to serve video, telecommunications, security service providers, television, smart home and HVAC system manufacturers. For over 37 years, UEI has been pioneering breakthrough innovations such as voice control and QuickSet cloud, the world's leading platform for automated set-up and control of devices in the home. For more information, visit www.uei.com.
Forward-looking Statements
This press release and accompanying schedules contain "forward-looking statements" within the meaning of federal securities laws, including net sales, profit margin and earnings trends, estimates and assumptions; our expectations about new product introductions; and similar statements concerning anticipated future events and expectations that are not historical facts. We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those we identify below and other risk factors that we identify in our annual report on Form 10-K for the year ended December 31, 2022 and the periodic reports filed and furnished since then. Risks that could affect forward-looking statements in this press release include: our continued ability to timely develop and deliver products and technologies that will be accepted by our customers, both near- and long-term; our ability to attract new customers and to successfully capture sales in all markets we serve, including in the home automation, climate control, and connected home markets as anticipated by management; our ability to continue optimizing our manufacturing footprint and realize the lower concentration risks in the time frame and to the extent expected by management; the slowdown of the traditional subscription broadcast market dissipating as expected by management, our ability to manage through the supply chain constraints, inflationary pressures and macroeconomic conditions, including continued lower consumer spending; the continued commitment of our customers to their product development and ordering strategies and patterns that translate into greater demand for our technologies and products as anticipated by management; our ability to continue to manage our business, inventories and cash flows to achieve our net sales, margins and earnings through financial discipline, operational efficiency, product line management, liquidity requirements, capital expenditures and other investment spending expectations, including our ability to execute on our stock repurchase programs; the Company’s continued ability to successfully enforce its patented technology against Roku; the continued fluctuation in our market capitalization; the direct and indirect impact we may experience with respect to our business and financial results and management’s ability to anticipate and mitigate the impact stemming from the continued economic uncertainty affecting consumers’ confidence and spending, natural disasters or other events beyond our control, public health crises (including an outbreak of infectious disease), governmental actions, including the effects of political unrest, war, terrorist activities, or other hostilities; the effects and uncertainties and other factors more fully described in our reports filed with the SEC; and the effects that changes in or enhanced use of laws, regulations and policies may have on our business including the impact of trade regulations pertaining to importation of our products. Since it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results, the above list should not be considered a complete list. Further, any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release. We make these forward-looking statements as of February 15, 2024, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
– Tables Follow –
UNIVERSAL ELECTRONICS INC. CONSOLIDATED BALANCE SHEETS (In thousands, except share-related data) (Unaudited) |
||||||||
|
|
December 31, 2023 |
|
December 31, 2022 |
||||
ASSETS |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
42,751 |
|
|
$ |
66,740 |
|
Accounts receivable, net |
|
|
112,596 |
|
|
|
112,346 |
|
Contract assets |
|
|
4,240 |
|
|
|
7,996 |
|
Inventories |
|
|
88,273 |
|
|
|
140,181 |
|
Prepaid expenses and other current assets |
|
|
7,325 |
|
|
|
6,647 |
|
Income tax receivable |
|
|
3,666 |
|
|
|
4,130 |
|
Total current assets |
|
|
258,851 |
|
|
|
338,040 |
|
Property, plant and equipment, net |
|
|
44,619 |
|
|
|
62,791 |
|
Goodwill |
|
|
— |
|
|
|
49,085 |
|
Intangible assets, net |
|
|
25,349 |
|
|
|
24,470 |
|
Operating lease right-of-use assets |
|
|
18,693 |
|
|
|
21,599 |
|
Deferred income taxes |
|
|
6,787 |
|
|
|
6,242 |
|
Other assets |
|
|
1,573 |
|
|
|
1,936 |
|
Total assets |
|
$ |
355,872 |
|
|
$ |
504,163 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Accounts payable |
|
$ |
57,033 |
|
|
$ |
71,373 |
|
Line of credit |
|
|
55,000 |
|
|
|
88,000 |
|
Accrued compensation |
|
|
20,305 |
|
|
|
20,904 |
|
Accrued sales discounts, rebates and royalties |
|
|
5,796 |
|
|
|
6,477 |
|
Accrued income taxes |
|
|
1,833 |
|
|
|
5,585 |
|
Other accrued liabilities |
|
|
21,181 |
|
|
|
24,134 |
|
Total current liabilities |
|
|
161,148 |
|
|
|
216,473 |
|
Long-term liabilities: |
|
|
|
|
||||
Operating lease obligations |
|
|
12,560 |
|
|
|
15,027 |
|
Deferred income taxes |
|
|
1,992 |
|
|
|
2,724 |
|
Income tax payable |
|
|
435 |
|
|
|
723 |
|
Other long-term liabilities |
|
|
817 |
|
|
|
810 |
|
Total liabilities |
|
|
176,952 |
|
|
|
235,757 |
|
Commitments and contingencies |
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
|
||||
Preferred stock, |
|
|
— |
|
|
|
— |
|
Common stock, |
|
|
253 |
|
|
|
250 |
|
Paid-in capital |
|
|
336,938 |
|
|
|
326,839 |
|
Treasury stock, at cost, 12,459,845 and 12,295,305 shares on December 31, 2023 and 2022, respectively |
|
|
(369,973 |
) |
|
|
(368,194 |
) |
Accumulated other comprehensive income (loss) |
|
|
(20,758 |
) |
|
|
(21,187 |
) |
Retained earnings |
|
|
232,460 |
|
|
|
330,698 |
|
Total stockholders’ equity |
|
|
178,920 |
|
|
|
268,406 |
|
Total liabilities and stockholders’ equity |
|
$ |
355,872 |
|
|
$ |
504,163 |
|
UNIVERSAL ELECTRONICS INC. CONSOLIDATED INCOME STATEMENTS (In thousands, except per share amounts) (Unaudited) |
||||||||||||||||
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Net sales |
|
$ |
97,594 |
|
|
$ |
122,758 |
|
|
$ |
420,457 |
|
|
$ |
542,751 |
|
Cost of sales |
|
|
69,756 |
|
|
|
90,547 |
|
|
|
322,897 |
|
|
|
390,459 |
|
Gross profit |
|
|
27,838 |
|
|
|
32,211 |
|
|
|
97,560 |
|
|
|
152,292 |
|
Research and development expenses |
|
|
6,779 |
|
|
|
7,992 |
|
|
|
31,281 |
|
|
|
32,452 |
|
Factory restructuring charges |
|
|
325 |
|
|
|
— |
|
|
|
4,015 |
|
|
|
— |
|
Selling, general and administrative expenses |
|
|
23,346 |
|
|
|
26,104 |
|
|
|
98,490 |
|
|
|
105,292 |
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
49,075 |
|
|
|
— |
|
Operating income (loss) |
|
|
(2,612 |
) |
|
|
(1,885 |
) |
|
|
(85,301 |
) |
|
|
14,548 |
|
Interest income (expense), net |
|
|
(1,044 |
) |
|
|
(1,053 |
) |
|
|
(4,332 |
) |
|
|
(2,200 |
) |
Other income (expense), net |
|
|
(854 |
) |
|
|
(567 |
) |
|
|
(2,621 |
) |
|
|
(955 |
) |
Income (loss) before provision for income taxes |
|
|
(4,510 |
) |
|
|
(3,505 |
) |
|
|
(92,254 |
) |
|
|
11,393 |
|
Provision for income taxes |
|
|
2,592 |
|
|
|
3,400 |
|
|
|
5,984 |
|
|
|
10,986 |
|
Net income (loss) |
|
$ |
(7,102 |
) |
|
$ |
(6,905 |
) |
|
$ |
(98,238 |
) |
|
$ |
407 |
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share: |
|
|
|
|
|
|
||||||||||
Basic |
|
$ |
(0.55 |
) |
|
$ |
(0.54 |
) |
|
$ |
(7.64 |
) |
|
$ |
0.03 |
|
Diluted |
|
$ |
(0.55 |
) |
|
$ |
(0.54 |
) |
|
$ |
(7.64 |
) |
|
$ |
0.03 |
|
Shares used in computing earnings (loss) per share: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
|
12,902 |
|
|
|
12,686 |
|
|
|
12,855 |
|
|
|
12,703 |
|
Diluted |
|
|
12,902 |
|
|
|
12,686 |
|
|
|
12,855 |
|
|
|
12,779 |
|
UNIVERSAL ELECTRONICS INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) |
||||||||
|
|
Year Ended December 31, |
||||||
|
|
2023 |
|
2022 |
||||
Cash flows from operating activities: |
|
|
|
|
||||
Net income (loss) |
|
$ |
(98,238 |
) |
|
$ |
407 |
|
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
|
22,927 |
|
|
|
24,033 |
|
Provision for credit losses |
|
|
70 |
|
|
|
(182 |
) |
Deferred income taxes |
|
|
(1,149 |
) |
|
|
1,377 |
|
Shares issued for employee benefit plan |
|
|
1,293 |
|
|
|
1,199 |
|
Employee and director stock-based compensation |
|
|
8,809 |
|
|
|
10,013 |
|
Impairment of goodwill |
|
|
49,075 |
|
|
|
— |
|
Impairment of long-lived assets |
|
|
7,963 |
|
|
|
2,888 |
|
Changes in operating assets and liabilities: |
|
|
|
|
||||
Accounts receivable and contract assets |
|
|
5,040 |
|
|
|
12,765 |
|
Inventories |
|
|
51,458 |
|
|
|
(9,913 |
) |
Prepaid expenses and other assets |
|
|
2,860 |
|
|
|
(917 |
) |
Accounts payable and accrued liabilities |
|
|
(21,379 |
) |
|
|
(28,670 |
) |
Accrued income taxes |
|
|
(3,539 |
) |
|
|
(2,074 |
) |
Net cash provided by (used for) operating activities |
|
|
25,190 |
|
|
|
10,926 |
|
Cash flows from investing activities: |
|
|
|
|
||||
Purchase of term deposit |
|
|
— |
|
|
|
(7,487 |
) |
Redemption of term deposit |
|
|
— |
|
|
|
7,803 |
|
Acquisition of net assets of Qterics, Inc. |
|
|
— |
|
|
|
(939 |
) |
Acquisitions of property, plant and equipment |
|
|
(8,116 |
) |
|
|
(14,006 |
) |
Acquisitions of intangible assets |
|
|
(5,761 |
) |
|
|
(6,579 |
) |
Net cash provided by (used for) investing activities |
|
|
(13,877 |
) |
|
|
(21,208 |
) |
Cash flows from financing activities: |
|
|
|
|
||||
Borrowings under line of credit |
|
|
78,000 |
|
|
|
133,000 |
|
Repayments on line of credit |
|
|
(111,000 |
) |
|
|
(101,000 |
) |
Proceeds from stock options exercised |
|
|
— |
|
|
|
1,536 |
|
Treasury stock purchased |
|
|
(1,779 |
) |
|
|
(13,035 |
) |
Net cash provided by (used for) financing activities |
|
|
(34,779 |
) |
|
|
20,501 |
|
Effect of foreign currency exchange rates on cash and cash equivalents |
|
|
(523 |
) |
|
|
(4,292 |
) |
Net increase (decrease) in cash and cash equivalents |
|
|
(23,989 |
) |
|
|
5,927 |
|
Cash and cash equivalents at beginning of period |
|
|
66,740 |
|
|
|
60,813 |
|
Cash and cash equivalents at end of period |
|
$ |
42,751 |
|
|
$ |
66,740 |
|
|
|
|
|
|
||||
Supplemental cash flow information: |
|
|
|
|
||||
Income taxes paid |
|
$ |
13,176 |
|
|
$ |
10,922 |
|
Interest paid |
|
$ |
7,015 |
|
|
$ |
2,214 |
|
UNIVERSAL ELECTRONICS INC. RECONCILIATION OF ADJUSTED NON-GAAP FINANCIAL RESULTS (In thousands, except per share amounts) (Unaudited) |
||||||||||||||||
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Net sales: |
|
|
|
|
|
|
|
|
||||||||
Net sales - GAAP |
|
$ |
97,594 |
|
|
$ |
122,758 |
|
|
$ |
420,457 |
|
|
$ |
542,751 |
|
Adjusted Non-GAAP net sales |
|
$ |
97,594 |
|
|
$ |
122,758 |
|
|
$ |
420,457 |
|
|
$ |
542,751 |
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of sales: |
|
|
|
|
|
|
|
|
||||||||
Cost of sales - GAAP |
|
$ |
69,756 |
|
|
$ |
90,547 |
|
|
$ |
322,897 |
|
|
$ |
390,459 |
|
Excess manufacturing overhead and factory transition costs (1) |
|
|
(1,539 |
) |
|
|
(2,549 |
) |
|
|
(9,108 |
) |
|
|
(6,670 |
) |
Impairment of long-lived assets (2) |
|
|
— |
|
|
|
(2,868 |
) |
|
|
(7,723 |
) |
|
|
(2,868 |
) |
Stock-based compensation expense |
|
|
(32 |
) |
|
|
(38 |
) |
|
|
(125 |
) |
|
|
(155 |
) |
Adjustments to acquired tangible assets (3) |
|
|
(60 |
) |
|
|
(60 |
) |
|
|
(241 |
) |
|
|
(241 |
) |
Adjusted Non-GAAP cost of sales |
|
|
68,125 |
|
|
|
85,032 |
|
|
|
305,700 |
|
|
|
380,525 |
|
Adjusted Non-GAAP gross profit |
|
$ |
29,469 |
|
|
$ |
37,726 |
|
|
$ |
114,757 |
|
|
$ |
162,226 |
|
|
|
|
|
|
|
|
|
|
||||||||
Gross margin: |
|
|
|
|
|
|
|
|
||||||||
Gross margin - GAAP |
|
|
28.5 |
% |
|
|
26.2 |
% |
|
|
23.2 |
% |
|
|
28.1 |
% |
Excess manufacturing overhead and factory transition costs (1) |
|
|
1.6 |
% |
|
|
2.1 |
% |
|
|
2.2 |
% |
|
|
1.2 |
% |
Impairment of long-lived assets (2) |
|
|
— |
% |
|
|
2.3 |
% |
|
|
1.8 |
% |
|
|
0.5 |
% |
Stock-based compensation expense |
|
|
0.0 |
% |
|
|
0.0 |
% |
|
|
0.0 |
% |
|
|
0.0 |
% |
Adjustments to acquired tangible assets (3) |
|
|
0.1 |
% |
|
|
0.1 |
% |
|
|
0.1 |
% |
|
|
0.1 |
% |
Adjusted Non-GAAP gross margin |
|
|
30.2 |
% |
|
|
30.7 |
% |
|
|
27.3 |
% |
|
|
29.9 |
% |
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses: |
|
|
|
|
|
|
|
|
||||||||
Operating expenses - GAAP |
|
$ |
30,450 |
|
|
$ |
34,096 |
|
|
$ |
182,861 |
|
|
$ |
137,744 |
|
Stock-based compensation expense |
|
|
(1,945 |
) |
|
|
(2,401 |
) |
|
|
(8,684 |
) |
|
|
(9,858 |
) |
Amortization of acquired intangible assets |
|
|
(281 |
) |
|
|
(281 |
) |
|
|
(1,137 |
) |
|
|
(1,153 |
) |
Litigation costs (4) |
|
|
(83 |
) |
|
|
(2,004 |
) |
|
|
(1,687 |
) |
|
|
(6,268 |
) |
Goodwill impairment (5) |
|
|
— |
|
|
|
— |
|
|
|
(49,075 |
) |
|
|
— |
|
Impairment of long-lived assets (2) |
|
|
— |
|
|
|
— |
|
|
|
(100 |
) |
|
|
— |
|
Factory restructuring charges (6) |
|
|
(325 |
) |
|
|
— |
|
|
|
(4,015 |
) |
|
|
— |
|
Severance (7) |
|
|
(180 |
) |
|
|
— |
|
|
|
(2,635 |
) |
|
|
— |
|
Adjusted Non-GAAP operating expenses |
|
$ |
27,636 |
|
|
$ |
29,410 |
|
|
$ |
115,528 |
|
|
$ |
120,465 |
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss): |
|
|
|
|
|
|
|
|
||||||||
Operating income (loss) - GAAP |
|
$ |
(2,612 |
) |
|
$ |
(1,885 |
) |
|
$ |
(85,301 |
) |
|
$ |
14,548 |
|
Excess manufacturing overhead and factory transition costs (1) |
|
|
1,539 |
|
|
|
2,549 |
|
|
|
9,108 |
|
|
|
6,670 |
|
Impairment of long-lived assets (2) |
|
|
— |
|
|
|
2,868 |
|
|
|
7,823 |
|
|
|
2,868 |
|
Stock-based compensation expense |
|
|
1,977 |
|
|
|
2,439 |
|
|
|
8,809 |
|
|
|
10,013 |
|
Adjustments to acquired tangible assets (3) |
|
|
60 |
|
|
|
60 |
|
|
|
241 |
|
|
|
241 |
|
Amortization of acquired intangible assets |
|
|
281 |
|
|
|
281 |
|
|
|
1,137 |
|
|
|
1,153 |
|
Litigation costs (4) |
|
|
83 |
|
|
|
2,004 |
|
|
|
1,687 |
|
|
|
6,268 |
|
Goodwill impairment (5) |
|
|
— |
|
|
|
— |
|
|
|
49,075 |
|
|
|
— |
|
Factory restructuring costs (6) |
|
|
325 |
|
|
|
— |
|
|
|
4,015 |
|
|
|
— |
|
Severance (7) |
|
|
180 |
|
|
|
— |
|
|
|
2,635 |
|
|
|
— |
|
Adjusted Non-GAAP operating income (loss) |
|
$ |
1,833 |
|
|
$ |
8,316 |
|
|
$ |
(771 |
) |
|
$ |
41,761 |
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted Non-GAAP operating income (loss) as a percentage of net sales |
|
|
1.9 |
% |
|
|
6.8 |
% |
|
|
(0.2 |
) % |
|
|
7.7 |
% |
UNIVERSAL ELECTRONICS INC. RECONCILIATION OF ADJUSTED NON-GAAP FINANCIAL RESULTS (In thousands, except per share amounts) (Unaudited) |
|||||||||||||||
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||||
Net income (loss): |
|
|
|
|
|
|
|
|
|||||||
Net income (loss) - GAAP |
|
$ |
(7,102 |
) |
|
$ |
(6,905 |
) |
|
$ |
(98,238 |
) |
|
$ |
407 |
Excess manufacturing overhead and factory transition costs (1) |
|
|
1,539 |
|
|
|
2,549 |
|
|
|
9,108 |
|
|
|
6,670 |
Impairment of long-lived assets (2) |
|
|
— |
|
|
|
2,868 |
|
|
|
7,823 |
|
|
|
2,868 |
Stock-based compensation expense |
|
|
1,977 |
|
|
|
2,439 |
|
|
|
8,809 |
|
|
|
10,013 |
Adjustments to acquired tangible assets (3) |
|
|
60 |
|
|
|
60 |
|
|
|
241 |
|
|
|
241 |
Amortization of acquired intangible assets |
|
|
281 |
|
|
|
281 |
|
|
|
1,137 |
|
|
|
1,153 |
Litigation costs (4) |
|
|
83 |
|
|
|
2,004 |
|
|
|
1,687 |
|
|
|
6,268 |
Goodwill impairment (5) |
|
|
— |
|
|
|
— |
|
|
|
49,075 |
|
|
|
— |
Factory restructuring costs (6) |
|
|
325 |
|
|
|
— |
|
|
|
4,015 |
|
|
|
— |
Severance (7) |
|
|
180 |
|
|
|
— |
|
|
|
2,635 |
|
|
|
— |
Foreign currency (gain) loss |
|
|
1,258 |
|
|
|
1,075 |
|
|
|
3,501 |
|
|
|
1,091 |
Income tax provision on adjustments |
|
|
2,317 |
|
|
|
1,277 |
|
|
|
6,517 |
|
|
|
4,035 |
Other income tax adjustments (8) |
|
|
— |
|
|
|
— |
|
|
|
1,377 |
|
|
|
— |
Adjusted Non-GAAP net income (loss) |
|
$ |
918 |
|
|
$ |
5,648 |
|
|
$ |
(2,313 |
) |
|
$ |
32,746 |
|
|
|
|
|
|
|
|
|
|||||||
Diluted shares used in computing earnings (loss) per share: |
|
|
|
|
|
|
|
|
|||||||
GAAP |
|
|
12,902 |
|
|
|
12,686 |
|
|
|
12,855 |
|
|
|
12,779 |
Adjusted Non-GAAP |
|
|
12,933 |
|
|
|
12,729 |
|
|
|
12,855 |
|
|
|
12,779 |
|
|
|
|
|
|
|
|
|
|||||||
Diluted earnings (loss) per share: |
|
|
|
|
|
|
|
|
|||||||
Diluted earnings (loss) per share - GAAP |
|
$ |
(0.55 |
) |
|
$ |
(0.54 |
) |
|
$ |
(7.64 |
) |
|
$ |
0.03 |
Total adjustments |
|
$ |
0.62 |
|
|
$ |
0.99 |
|
|
$ |
7.46 |
|
|
$ |
2.53 |
Adjusted Non-GAAP diluted earnings (loss) per share |
|
$ |
0.07 |
|
|
$ |
0.44 |
|
|
$ |
(0.18 |
) |
|
$ |
2.56 |
| (1) |
The three and twelve months ended December 31, 2023 and 2022 include unabsorbed manufacturing overhead costs resulting from the expansion of our manufacturing facility in |
|
| (2) |
The twelve months ended December 31, 2023 include impairment charges relating to machinery and equipment and leasehold improvements associated with the closure of our southwestern |
|
| (3) | Consists of depreciation related to the mark-up from cost to fair value of fixed assets acquired in business combinations. |
|
| (4) |
Consists of expenses related to our various litigation matters involving Roku, Inc. and certain other related entities including three |
|
| (5) |
During the twelve months ended December 31, 2023, we recorded a goodwill impairment charge of |
|
| (6) |
The three and twelve months ended December 31, 2023 include severance and equipment moving costs associated with the closure of our southwestern |
|
| (7) | The three and twelve months ended December 31, 2023 include severance costs associated with a reduction in headcount at our corporate offices. |
|
| (8) |
The twelve months ended December 31, 2023 includes a |
UNIVERSAL ELECTRONICS INC. RECONCILIATION OF ADJUSTED NON-GAAP FINANCIAL OUTLOOK AND FINANCIAL RESULTS (In thousands, except per share amounts) (Unaudited) |
||||||||||||
|
|
Three Months Ended March 31, |
||||||||||
|
|
2024 |
|
2023 |
||||||||
|
|
Low Range |
|
High Range |
|
Actual |
||||||
Net sales: |
|
|
|
|
|
|
||||||
Net sales - GAAP |
|
$ |
86,000 |
|
|
$ |
96,000 |
|
|
$ |
108,377 |
|
Total adjustments (1) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Adjusted Non-GAAP net sales |
|
$ |
86,000 |
|
|
$ |
96,000 |
|
|
$ |
108,377 |
|
|
|
|
|
|
|
|
||||||
Loss per share: |
|
|
|
|
|
|
||||||
Loss per share - GAAP |
|
$ |
(0.88 |
) |
|
$ |
(0.78 |
) |
|
$ |
(4.81 |
) |
Total adjustments (2) |
|
$ |
0.61 |
|
|
$ |
0.61 |
|
|
$ |
4.54 |
|
Adjusted Non-GAAP loss per share |
|
$ |
(0.27 |
) |
|
$ |
(0.17 |
) |
|
$ |
(0.28 |
) |
| (1) | The three months ended March 31, 2024 and 2023 do not include any Non-GAAP adjustments to net sales. |
|
| (2) | The three months ended March 31, 2024 and 2023 includes adjustments for excess manufacturing overhead costs, factory transition costs, stock-based compensation expense, depreciation expense related to the increase in fixed assets from cost to fair market value resulting from acquisitions, amortization of acquired intangibles, costs associated with certain litigation efforts, foreign currency gains and losses and the related tax impact of these adjustments. The three months ended March 31, 2023 also includes adjustments for goodwill impairment. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240215442075/en/
Paul Arling, Chairman & CEO, UEI, 480-530-3000
Investors: Kirsten Chapman, LHA Investor Relations, uei@lhai.com, 415-433-3777
Source: Universal Electronics Inc.
FAQ
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