Lantronix, Inc. (NASDAQ: LTRX) a global provider of secure data
access and management solutions for Internet of Things (IoT) and
information technology (IT) assets, today reported results for the
third quarter of its fiscal year 2017 ended March 31, 2017.
Financial Highlights for Third Fiscal
Quarter
- Net revenue of $11.5 million
- Gross profit margin of 55.5%
- GAAP net loss of $162,000 or $0.01 per share
- Non-GAAP net income of $484,000
- Generated $627,000 in cash from operating activities
- Cash and cash equivalents grew to $7.4 million
Operational and Product
Highlights:
- Net revenue for the third quarter of fiscal 2017 increased 16%
from the same period in fiscal 2016 and 3% from the second quarter
of fiscal 2017.
- Sales of the company’s IoT products grew by 14% during the
third quarter of fiscal 2017 compared with the same period in
fiscal 2016.
- Sales of the company’s IT Management products grew by 93%
during the third quarter of fiscal 2017 compared with the same
period in fiscal 2016.
- In January, the company introduced a technology preview of its
MACH10™ software platform. MACH10™ is a multi-dimensional
management software platform designed specifically to enable IoT
OEMs (original equipment manufacturers) to quickly and profitably
deliver web-scale IoT applications and services.
- In February, Intel IoT veteran Shahram Mehraban joined the
company as vice president of marketing. Prior to joining Lantronix,
Mehraban served as marketing director and chief of staff of the
industrial and energy solutions division of Intel’s IoT Group,
where he played a key role in expanding the company’s industry
visibility in key IoT verticals, and served as part of the IoT
executive team that delivered innovative end-to-end solutions for
the industrial IoT market.
- In March, the company previewed the xPico 200 product family of
embedded IoT gateways at Embedded World 2017 in Nürnberg, Germany.
xPico 200 series will feature advanced enterprise security,
networking intelligence, and pre-integration with Lantronix’s
MACH10 management software platform in a compact 17mm by 25 mm
footprint.
“I’m pleased to report that we delivered 16% year-over-year
topline growth, as well as our fifth consecutive quarter of
non-GAAP net income,” said Jeffrey Benck, Lantronix president and
CEO. “During the third quarter, we continued to gain market
share in the management console business, as we more than doubled
the revenue of our SLC 8000 product family over the third quarter
of FY 2016. With the unveiling of our MACH10 IoT management
platform strategy, we continued to demonstrate our commitment to
delivering complete solutions for the IoT market and making
progress against our strategic plan.”
Financial Results for the Third Quarter of Fiscal Year
2017
Net revenue was $11.5 million for the third quarter of fiscal
2017, compared with $10.0 million for the third quarter of fiscal
2016, and $11.2 million for the second quarter of fiscal 2017.
Gross profit margin was 55.5% for the third quarter of fiscal
2017, compared to 48.0% for the third quarter of fiscal 2016, and
51.8% for the second quarter of fiscal 2017.
Operating expenses were $6.5 million for the third quarter of
fiscal 2017, compared with $5.2 million for the third quarter of
fiscal 2016, and $5.7 million for the second quarter of fiscal
2017. Increase in operating expenses was due in part to higher
variable compensation expenses driven by strong year-over-year
revenue growth and charges related to the restructuring of the
European sales organization.
GAAP net loss for the third quarter of fiscal 2017 was $162,000
or $0.01 per share, compared with GAAP net loss of $456,000, or
$0.03 per share, for the third quarter of fiscal 2016, and GAAP net
income of $41,000, or $0.00 per share, for the second quarter of
fiscal 2017.
Non-GAAP net income for the third quarter of fiscal 2017 was
$484,000, compared with non-GAAP net income of $189,000 for the
third quarter of fiscal 2016, and non-GAAP net income of $444,000
for the second quarter of fiscal 2017. For additional information
regarding the company’s non-GAAP results, see “Discussion of
Non-GAAP Financial Measures” below.
Conference Call and Webcast
Lantronix will host an investor conference call with a
simultaneous audio webcast today at 2:00 p.m. Pacific Time (5:00
p.m. Eastern Time) to discuss its fiscal 2017 third quarter
results. To access the live conference call, investors should dial
1-844-802-2442 (US) or 1-412-317-5135 (international) and indicate
that they are participating in the Lantronix Fiscal Year 2017 Third
Quarter call. The webcast will be available simultaneously via the
investor relations section of the company’s website at
www.lantronix.com.
Investors can access a replay of the conference call starting at
approximately 5:00 p.m. Pacific Time today at www.lantronix.com. A
telephonic replay will also be available through May 4, 2017 by
dialing 1-877-344-7529 (US) or 1-412-317-0088 (international) and
entering passcode 10105368.
About Lantronix Lantronix, Inc. is a global
provider of secure data access and management solutions for
Internet of Things (IoT) and information technology (IT) assets.
Our mission is to be the leading supplier of IoT gateways that
enable companies to dramatically simplify the creation, deployment,
and management of IoT projects while providing secure access to
data for applications and people.
With more than two decades of experience in creating robust
machine to machine (M2M) technologies, Lantronix is an innovator in
enabling our customers to build new business models and realize the
possibilities of the Internet of Things. Our connectivity solutions
are deployed inside millions of machines serving a wide range of
industries, including data center, medical, security, industrial,
transportation, retail, financial, environmental and
government.
For more information, visit www.lantronix.com.
Learn more at the Lantronix blog, www.lantronix.com/blog,
featuring industry discussion and updates. To follow Lantronix on
Twitter, please visit www.twitter.com/Lantronix. View our video
library on YouTube at www.youtube.com/user/LantronixInc or connect
with us on LinkedIn at www.linkedin.com/company/lantronix.
Discussion of Non-GAAP Financial Measures
Lantronix believes that the presentation of non-GAAP financial
information, when presented in conjunction with the corresponding
GAAP measures, provides important supplemental information to
management and investors regarding financial and business trends
relating to the company's financial condition and results of
operations. Management uses the aforementioned non-GAAP measures to
monitor and evaluate ongoing operating results and trends to gain
an understanding of our comparative operating performance. The
non-GAAP financial measures disclosed by the company should not be
considered a substitute for, or superior to, financial measures
calculated in accordance with GAAP, and the financial results
calculated in accordance with GAAP and reconciliations of the
non-GAAP financial measures to the financial measures calculated in
accordance with GAAP should be carefully evaluated. The non-GAAP
financial measures used by the company may be calculated
differently from, and therefore may not be comparable to, similarly
titled measures used by other companies. The company has provided
reconciliations of the non-GAAP financial measures to the most
directly comparable GAAP financial measures.
Non-GAAP net income (loss) consists of net income (loss)
excluding (i) non-GAAP adjustments to operating expenses, (ii)
interest income (expense), (iii) other income (expense), (iv)
income tax provision (benefit), and (v) severance and restructuring
charges.
Forward-Looking Statements
This news release contains forward-looking statements, including
statements concerning our sales expansion efforts, our product
development efforts, and our projected operating and financial
performance. These forward-looking statements are intended to
qualify for the safe harbor from liability established by the
Private Securities Litigation Reform Act of 1995. We have based our
forward-looking statements on our current expectations and
projections about trends affecting our business and industry and
other future events. Although we do not make forward-looking
statements unless we believe we have a reasonable basis for doing
so, we cannot guarantee their accuracy. Forward-looking statements
are subject to substantial risks and uncertainties that could cause
our results or experiences, or future business, financial
condition, results of operations or performance, to differ
materially from our historical results or those expressed or
implied in any forward-looking statement contained in this news
release. Some of the risks and uncertainties that may cause actual
results to differ from those expressed or implied in the
forward-looking statements are described in “Risk Factors” in our
Annual Report on Form 10-K filed with the Securities and Exchange
Commission, or SEC, as well as in our other filings with the SEC.
In addition, actual results may differ as a result of additional
risks and uncertainties of which we are currently unaware or which
we do not currently view as material to our business. For these
reasons, investors are cautioned not to place undue reliance on any
forward-looking statements. The forward-looking statements we make
speak only as of the date on which they are made. We expressly
disclaim any intent or obligation to update any forward-looking
statements after the date hereof to conform such statements to
actual results or to changes in our opinions or expectations,
except as required by applicable law or the rules of the NASDAQ
Stock Market, LLC. If we do update or correct any forward-looking
statements, investors should not conclude that we will make
additional updates or corrections.
© 2017 Lantronix, Inc. All rights reserved. Lantronix and xPico
are registered trademarks, and MACH10 is a trademark, of Lantronix,
Inc. All other trademarks and trade names are the property of their
respective holders.
|
LANTRONIX,
INC. |
UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS |
(In
thousands) |
|
|
|
|
|
March 31, |
|
|
June 30, |
|
|
|
|
|
2017 |
|
|
|
|
2016 |
|
Assets |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
|
|
$ |
7,389 |
|
|
|
$ |
5,962 |
|
Accounts
receivable, net |
|
|
|
|
2,827 |
|
|
|
|
3,164 |
|
Inventories, net |
|
|
|
|
7,664 |
|
|
|
|
6,584 |
|
Contract
manufacturers' receivable |
|
|
|
|
314 |
|
|
|
|
369 |
|
Prepaid
expenses and other current assets |
|
|
|
|
536 |
|
|
|
|
580 |
|
Total
current assets |
|
|
|
|
18,730 |
|
|
|
|
16,659 |
|
Property
and equipment, net |
|
|
|
|
1,278 |
|
|
|
|
1,569 |
|
Goodwill |
|
|
|
|
9,488 |
|
|
|
|
9,488 |
|
Other
assets |
|
|
|
|
49 |
|
|
|
|
63 |
|
Total
assets |
|
|
|
$ |
29,545 |
|
|
|
$ |
27,779 |
|
|
|
|
|
|
|
|
|
Liabilities and stockholders' equity |
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
Accounts
payable |
|
|
|
$ |
2,719 |
|
|
|
$ |
2,721 |
|
Accrued
payroll and related expenses |
|
|
|
|
2,623 |
|
|
|
|
1,817 |
|
Warranty
reserve |
|
|
|
|
116 |
|
|
|
|
138 |
|
Other
current liabilities |
|
|
|
|
3,344 |
|
|
|
|
2,922 |
|
Total
current liabilities |
|
|
|
|
8,802 |
|
|
|
|
7,598 |
|
Long-term capital lease obligations |
|
|
|
|
71 |
|
|
|
|
116 |
|
Other
non-current liabilities |
|
|
|
|
378 |
|
|
|
|
347 |
|
Total
liabilities |
|
|
|
|
9,251 |
|
|
|
|
8,061 |
|
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity: |
|
|
|
|
|
|
|
Common
stock |
|
|
|
|
2 |
|
|
|
|
2 |
|
Additional paid-in capital |
|
|
|
|
210,104 |
|
|
|
|
209,297 |
|
Accumulated deficit |
|
|
|
|
(190,183 |
) |
|
|
|
(189,952 |
) |
Accumulated other comprehensive income |
|
|
|
|
371 |
|
|
|
|
371 |
|
Total
stockholders' equity |
|
|
|
|
20,294 |
|
|
|
|
19,718 |
|
Total
liabilities and stockholders' equity |
|
|
|
$ |
29,545 |
|
|
|
$ |
27,779 |
|
|
|
|
|
|
|
|
|
LANTRONIX, INC. |
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
(In thousands, except per share
data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
|
|
|
|
Nine Months
Ended |
|
|
|
March
31, |
|
|
December 31, |
|
|
March
31, |
|
|
|
|
|
|
March
31, |
|
|
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
2016 |
|
|
|
|
|
|
|
|
2017 |
|
|
|
|
2016 |
|
|
Net revenue (1) |
|
$ |
11,524 |
|
|
|
$ |
11,222 |
|
|
|
$ |
9,964 |
|
|
|
|
|
|
|
$ |
33,686 |
|
|
|
$ |
30,077 |
|
|
Cost of revenue |
|
|
5,126 |
|
|
|
|
5,410 |
|
|
|
|
5,186 |
|
|
|
|
|
|
|
|
15,776 |
|
|
|
|
15,643 |
|
|
Gross profit |
|
|
6,398 |
|
|
|
|
5,812 |
|
|
|
|
4,778 |
|
|
|
|
|
|
|
|
17,910 |
|
|
|
|
14,434 |
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative |
|
|
4,414 |
|
|
|
|
3,873 |
|
|
|
|
3,469 |
|
|
|
|
|
|
|
|
12,129 |
|
|
|
|
11,008 |
|
|
Research
and development |
|
|
2,126 |
|
|
|
|
1,873 |
|
|
|
|
1,744 |
|
|
|
|
|
|
|
|
5,944 |
|
|
|
|
5,131 |
|
|
Total operating
expenses |
|
|
6,540 |
|
|
|
|
5,746 |
|
|
|
|
5,213 |
|
|
|
|
|
|
|
|
18,073 |
|
|
|
|
16,139 |
|
|
Income (loss) from
operations |
|
|
(142 |
) |
|
|
|
66 |
|
|
|
|
(435 |
) |
|
|
|
|
|
|
|
(163 |
) |
|
|
|
(1,705 |
) |
|
Interest expense,
net |
|
|
(5 |
) |
|
|
|
(6 |
) |
|
|
|
(8 |
) |
|
|
|
|
|
|
|
(18 |
) |
|
|
|
(23 |
) |
|
Other income (expense),
net |
|
|
2 |
|
|
|
|
4 |
|
|
|
|
- |
|
|
|
|
|
|
|
|
3 |
|
|
|
|
47 |
|
|
Income (loss) before
income taxes |
|
|
(145 |
) |
|
|
|
64 |
|
|
|
|
(443 |
) |
|
|
|
|
|
|
|
(178 |
) |
|
|
|
(1,681 |
) |
|
Provision for income
taxes |
|
|
17 |
|
|
|
|
23 |
|
|
|
|
13 |
|
|
|
|
|
|
|
|
47 |
|
|
|
|
34 |
|
|
Net income (loss) |
|
$ |
(162 |
) |
|
|
$ |
41 |
|
|
|
$ |
(456 |
) |
|
|
|
|
|
|
$ |
(225 |
) |
|
|
$ |
(1,715 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share (basic) |
|
$ |
(0.01 |
) |
|
|
$ |
0.00 |
|
|
|
$ |
(0.03 |
) |
|
|
|
|
|
|
$ |
(0.01 |
) |
|
|
$ |
(0.11 |
) |
|
Net income (loss) per
share (diluted) |
|
$ |
(0.01 |
) |
|
|
$ |
0.00 |
|
|
|
$ |
(0.03 |
) |
|
|
|
|
|
|
$ |
(0.01 |
) |
|
|
$ |
(0.11 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common
shares (basic) |
|
|
17,522 |
|
|
|
|
17,347 |
|
|
|
|
15,225 |
|
|
|
|
|
|
|
|
17,374 |
|
|
|
|
15,163 |
|
|
Weighted-average common
shares (diluted) |
|
|
17,522 |
|
|
|
|
17,703 |
|
|
|
|
15,225 |
|
|
|
|
|
|
|
|
17,374 |
|
|
|
|
15,163 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue from
related parties |
|
$ |
- |
|
|
|
$ |
- |
|
|
|
$ |
- |
|
|
|
|
|
|
|
$ |
- |
|
|
|
$ |
113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes net
revenue from related parties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LANTRONIX, INC. |
UNAUDITED RECONCILIATION OF NON-GAAP
ADJUSTMENTS |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
|
|
Nine Months
Ended |
|
|
March
31, |
|
December 31, |
|
March 31, |
|
|
|
|
March
31, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2016 |
|
|
|
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss) |
|
$ |
(162 |
) |
|
$ |
41 |
|
|
$ |
(456 |
) |
|
|
|
|
$ |
(225 |
) |
|
$ |
(1,715 |
) |
Non-GAAP
adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation |
|
|
12 |
|
|
|
13 |
|
|
|
14 |
|
|
|
|
|
|
36 |
|
|
|
52 |
|
Depreciation and amortization |
|
|
87 |
|
|
|
84 |
|
|
|
120 |
|
|
|
|
|
|
260 |
|
|
|
393 |
|
Total
adjustments to cost of revenue |
|
|
99 |
|
|
|
97 |
|
|
|
134 |
|
|
|
|
|
|
296 |
|
|
|
445 |
|
Selling,
general and administrative: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation |
|
|
169 |
|
|
|
162 |
|
|
|
131 |
|
|
|
|
|
|
480 |
|
|
|
484 |
|
Employer
portion of withholding taxes on stock grants |
|
|
4 |
|
|
|
5 |
|
|
|
- |
|
|
|
|
|
|
9 |
|
|
|
4 |
|
Depreciation and amortization |
|
|
56 |
|
|
|
56 |
|
|
|
55 |
|
|
|
|
|
|
166 |
|
|
|
171 |
|
Total
adjustments to selling, general and administrative |
|
|
229 |
|
|
|
223 |
|
|
|
186 |
|
|
|
|
|
|
655 |
|
|
|
659 |
|
Research
and development: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation |
|
|
43 |
|
|
|
45 |
|
|
|
41 |
|
|
|
|
|
|
129 |
|
|
|
135 |
|
Employer
portion of withholding taxes on stock grants |
|
|
1 |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
1 |
|
|
|
- |
|
Depreciation and amortization |
|
|
8 |
|
|
|
13 |
|
|
|
16 |
|
|
|
|
|
|
29 |
|
|
|
50 |
|
Total
adjustments to research and development |
|
|
52 |
|
|
|
58 |
|
|
|
57 |
|
|
|
|
|
|
159 |
|
|
|
185 |
|
Severance
charges |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
286 |
|
Restructuring charges |
|
|
246 |
|
|
|
- |
|
|
|
247 |
|
|
|
|
|
|
246 |
|
|
|
247 |
|
Total
non-GAAP adjustments to operating expenses |
|
|
527 |
|
|
|
281 |
|
|
|
490 |
|
|
|
|
|
|
1,060 |
|
|
|
1,377 |
|
Interest
expense, net |
|
|
5 |
|
|
|
6 |
|
|
|
8 |
|
|
|
|
|
|
18 |
|
|
|
23 |
|
Other
income (expense), net |
|
|
(2 |
) |
|
|
(4 |
) |
|
|
- |
|
|
|
|
|
|
(3 |
) |
|
|
(47 |
) |
Provision
for income taxes |
|
|
17 |
|
|
|
23 |
|
|
|
13 |
|
|
|
|
|
|
47 |
|
|
|
34 |
|
Total non-GAAP
adjustments |
|
|
646 |
|
|
|
403 |
|
|
|
645 |
|
|
|
|
|
|
1,418 |
|
|
|
1,832 |
|
Non-GAAP net
income |
|
$ |
484 |
|
|
$ |
444 |
|
|
$ |
189 |
|
|
|
|
|
$ |
1,193 |
|
|
$ |
117 |
|
LANTRONIX, INC. |
|
UNAUDITED NET REVENUES BY PRODUCT LINE AND
REGION |
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
|
|
Nine Months
Ended |
|
|
|
|
March 31, 2017 |
|
|
December 31,
2016 |
|
|
March 31, 2016 |
|
|
|
|
March 31, 2017 |
|
March 31, 2016 |
|
IoT |
|
|
$ |
8,644 |
|
|
$ |
8,304 |
|
|
$ |
7,573 |
|
|
|
|
$ |
24,817 |
|
$ |
22,542 |
|
IT Management |
|
|
|
2,569 |
|
|
|
2,265 |
|
|
|
1,331 |
|
|
|
|
|
7,271 |
|
|
3,997 |
|
Other |
|
|
|
311 |
|
|
|
653 |
|
|
|
1,060 |
|
|
|
|
|
1,598 |
|
|
3,538 |
|
|
|
|
$ |
11,524 |
|
|
$ |
11,222 |
|
|
$ |
9,964 |
|
|
|
|
$ |
33,686 |
|
$ |
30,077 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
|
|
Nine Months
Ended |
|
|
|
|
March 31, 2017 |
|
|
December 31,
2016 |
|
|
March 31, 2016 |
|
|
|
|
March 31, 2017 |
|
March 31, 2016 |
|
Americas |
|
|
$ |
6,625 |
|
|
$ |
6,453 |
|
|
$ |
5,027 |
|
|
|
|
$ |
19,244 |
|
$ |
15,339 |
|
EMEA |
|
|
|
3,392 |
|
|
|
3,122 |
|
|
|
3,190 |
|
|
|
|
|
9,615 |
|
|
9,831 |
|
Asia Pacific Japan |
|
|
|
1,507 |
|
|
|
1,647 |
|
|
|
1,747 |
|
|
|
|
|
4,827 |
|
|
4,907 |
|
|
|
|
$ |
11,524 |
|
|
$ |
11,222 |
|
|
$ |
9,964 |
|
|
|
|
$ |
33,686 |
|
$ |
30,077 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investor Relations Contacts:
Jeremy Whitaker
Chief Financial Officer
949-453-3990
E.E. Wang
Director, Corporate Marketing and Investor Relations
investors@lantronix.com
949-614-5879
Lantronix (NASDAQ:LTRX)
Historical Stock Chart
From Feb 2024 to Mar 2024
Lantronix (NASDAQ:LTRX)
Historical Stock Chart
From Mar 2023 to Mar 2024