Lantronix Inc. (NASDAQ: LTRX), a global provider of secure turnkey
solutions for the Industrial Internet of Things (IoT) and the
Intelligent IT market, today reported results for its first quarter
of fiscal 2024.
Net revenue totaled $33.0 million, down 5 percent sequentially
and up 4 percent year-over-year.
GAAP EPS of ($0.05), compared to ($0.05) in the prior year and
($0.05) in the prior quarter.
Non-GAAP EPS of $0.07, compared to $0.07 in the prior year and
$0.06 in the prior quarter.
Business Outlook
For fiscal year 2024, the company continues to expect revenue in
a range of $175 million to $185 million and non-GAAP EPS in a range
of $0.50 to $0.60 per share.
Conference Call and Webcast
Management will host an investor conference call and audio
webcast on Wednesday, Nov. 8, 2023, at 2:00 p.m. Pacific Time (5:00
p.m. Eastern Time) to discuss its results for the first quarter of
fiscal 2024 that ended Sept. 30, 2023. 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 Q1 FY 2024 call. The webcast will be
available simultaneously via the investor relations section of the
company’s website.
Investors can access a replay of the conference call starting at
approximately 7:00 p.m. Pacific Time on Nov. 8, 2023, at the
Lantronix website. A telephonic replay will also be available
through Nov. 15, 2023, by dialing 1-877-344-7529 (US) or
1-412-317-0088 (international) and entering passcode 3340021.
About Lantronix
Lantronix Inc. is a global Industrial and Enterprise Internet of
Things (IoT) provider of solutions that target high-growth
applications in specific vertical markets, including Smart Grid,
Intelligent Transportation, Smart Cities and AI Data Centers.
Lantronix’s history in networking and video processing as well as
its leading-edge applications include Intelligent Substations
infrastructure, Infotainment systems and Video Surveillance,
supplemented with comprehensive Out of Band Management (OOB)
solutions for Cloud and Edge Computing.
Lantronix’s solutions empower companies to achieve success in
the growing IoT and OOB markets by delivering customizable
solutions that address each layer of the IoT Stack, including
Collect, Connect, Compute, Control and Comprehend. For more
information, visit the Lantronix website.
Learn more at the Lantronix blog, which features industry
discussion and updates. Follow Lantronix on Twitter, view its
YouTube video library or connect on LinkedIn.
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 consists of net loss excluding (i)
share-based compensation and the employer portion of withholding
taxes on stock grants, (ii) depreciation and amortization, (iii)
interest income (expense), (iv) other income (expense), (v) income
tax provision (benefit), (vi) restructuring, severance and related
charges, (vii) acquisition related costs, (viii) impairment of
long-lived assets, (ix) amortization of purchased intangibles, (x)
amortization of manufacturing profit in acquired inventory, (xi)
fair value remeasurement of earnout consideration, and (xii) loss
on extinguishment of debt.
Non-GAAP EPS is calculated by dividing non-GAAP net loss by
non-GAAP weighted-average shares outstanding (diluted). For
purposes of calculating non-GAAP EPS, the calculation of GAAP
weighted-average shares outstanding (diluted) is adjusted to
exclude share-based compensation, which for GAAP purposes is
treated as proceeds assumed to be used to repurchase shares under
the GAAP treasury stock method.
Guidance on earnings per share growth is provided only on a
non-GAAP basis due to the inherent difficulty of forecasting the
timing or amount of certain items that have been excluded from the
forward-looking non-GAAP measures, and a reconciliation to the
comparable GAAP guidance has not been provided because certain
factors that are materially significant to Lantronix’s ability to
estimate the excluded items are not accessible or estimable on a
forward-looking basis without unreasonable effort.
Forward-Looking Statements
This news release contains forward-looking
statements, including statements concerning our revenue and
earnings expectations for fiscal 2024. 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. Other factors which could have a
material adverse effect on our operations and future prospects or
which could cause actual results to differ materially from our
expectations include, but are not limited to: the effects of
negative or worsening regional and worldwide economic conditions or
market instability on our business, including effects on purchasing
decisions by our customers; our ability to mitigate any disruption
in our and our suppliers’ and vendors’ supply chains due to the
COVID-19 pandemic or other outbreaks, wars and recent conflicts in
Europe, Asia and the Middle East, or other causes; our ability to
successfully convert our backlog and current demand; the
impact of the COVID-19 pandemic or other pandemic or similar
outbreak, including the emergence of new more contagious and/or
vaccine-resistant strains, on our business, employees, supply and
distribution chains and the global economy; our ability to
successfully implement our acquisitions strategy or integrate
acquired companies; uncertainty as to the future profitability of
acquired businesses, and delays in the realization of, or the
failure to realize, any accretion from acquisition transactions;
acquiring, managing and integrating new operations, businesses or
assets, and the associated diversion of management attention or
other related costs or difficulties; our ability to continue to
generate revenue from products sold into mature markets; our
ability to develop, market, and sell new products; our ability to
succeed with our new software offerings; fluctuations in our
revenue due to the project-based timing of orders from certain
customers; unpredictable timing of our revenues due to the lengthy
sales cycle for our products and services and potential delays in
customer completion of projects; our ability to accurately forecast
future demand for our products; delays in qualifying revisions of
existing products; constraints or delays in the supply of, or
quality control issues with, certain materials or components;
difficulties associated with the delivery, quality or cost of our
products from our contract manufacturers or suppliers; risks
related to the outsourcing of manufacturing and international
operations; difficulties associated with our distributors or
resellers; intense competition in our industry and resultant
downward price pressure; rises in inventory levels and inventory
obsolescence; undetected software or hardware errors or defects in
our products; cybersecurity risks; our ability to obtain
appropriate industry certifications or approvals from governmental
regulatory bodies; changes in applicable U.S. and foreign
government laws, regulations, and tariffs; our ability to protect
patents and other proprietary rights and avoid infringement of
others’ proprietary technology rights; issues relating to the
stability of our financial and banking institutions and
relationships; the level of our indebtedness, our ability to
service our indebtedness and the restrictions in our debt
agreements; the impact of rising interest rates; our ability to
attract and retain qualified management; and any additional factors
included in our Report on Form 10-K for the fiscal year ended June
30, 2023, filed with the Securities and Exchange Commission (the
“SEC”) on Sept. 12, 2023, including in the section entitled “Risk
Factors” in Item 1A of Part I of that report, and in our other
public 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.
© 2023 Lantronix, Inc. All rights reserved.
Lantronix is a registered trademark.
Lantronix Investor Relations
Contact: Jeremy
WhitakerChief Financial Officerinvestors@lantronix.com
| |
| LANTRONIX,
INC. |
| UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS |
| (In
thousands) |
| |
|
|
|
|
| |
|
September 30, |
|
June 30, |
| |
|
2023 |
|
2023 |
|
Assets |
|
|
|
|
| Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
19,479 |
|
|
$ |
13,452 |
|
|
Accounts receivable, net |
|
|
30,105 |
|
|
|
27,682 |
|
|
Inventories, net |
|
|
45,796 |
|
|
|
49,736 |
|
|
Contract manufacturers' receivables |
|
|
630 |
|
|
|
3,019 |
|
|
Prepaid expenses and other current assets |
|
|
2,895 |
|
|
|
2,662 |
|
|
Total current assets |
|
|
98,905 |
|
|
|
96,551 |
|
| Property and
equipment, net |
|
|
4,926 |
|
|
|
4,629 |
|
|
Goodwill |
|
|
27,824 |
|
|
|
27,824 |
|
| Purchased
intangible assets, net |
|
|
9,181 |
|
|
|
10,565 |
|
| Lease
right-of-use assets |
|
|
11,102 |
|
|
|
11,583 |
|
| Other
assets |
|
|
461 |
|
|
|
472 |
|
|
Total assets |
|
$ |
152,399 |
|
|
$ |
151,624 |
|
| |
|
|
|
|
|
Liabilities and stockholders' equity |
|
|
|
|
| Current
liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
9,149 |
|
|
$ |
12,401 |
|
|
Accrued payroll and related expenses |
|
|
2,539 |
|
|
|
2,431 |
|
|
Current portion of long-term debt, net |
|
|
3,002 |
|
|
|
2,743 |
|
|
Other current liabilities |
|
|
34,062 |
|
|
|
28,813 |
|
|
Total current liabilities |
|
|
48,752 |
|
|
|
46,388 |
|
| Long-term
debt, net |
|
|
15,471 |
|
|
|
16,221 |
|
| Other
non-current liabilities |
|
|
11,185 |
|
|
|
11,459 |
|
|
Total liabilities |
|
|
75,408 |
|
|
|
74,068 |
|
| |
|
|
|
|
| Commitments
and contingencies (Note 9) |
|
|
|
|
| |
|
|
|
|
|
Stockholders' equity: |
|
|
|
|
|
Common stock |
|
|
4 |
|
|
|
4 |
|
|
Additional paid-in capital |
|
|
297,007 |
|
|
|
295,686 |
|
|
Accumulated deficit |
|
|
(220,391 |
) |
|
|
(218,505 |
) |
|
Accumulated other comprehensive income |
|
|
371 |
|
|
|
371 |
|
|
Total stockholders' equity |
|
|
76,991 |
|
|
|
77,556 |
|
|
Total liabilities and stockholders' equity |
|
$ |
152,399 |
|
|
$ |
151,624 |
|
|
|
|
|
|
|
| |
| LANTRONIX,
INC. |
| UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
| (In
thousands, except per share data) |
| |
|
|
|
|
|
|
| |
|
Three Months Ended |
| |
|
September 30, |
|
June 30, |
|
September 30, |
| |
|
2023 |
|
2023 |
|
2022 |
|
Net revenue |
|
$ |
33,031 |
|
|
$ |
34,924 |
|
|
$ |
31,795 |
|
| Cost of
revenue |
|
|
18,934 |
|
|
|
21,126 |
|
|
|
17,759 |
|
| Gross
profit |
|
|
14,097 |
|
|
|
13,798 |
|
|
|
14,036 |
|
| Operating
expenses: |
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
9,170 |
|
|
|
8,032 |
|
|
|
9,157 |
|
|
Research and development |
|
|
5,106 |
|
|
|
4,948 |
|
|
|
4,526 |
|
|
Restructuring, severance and related charges |
|
|
20 |
|
|
|
29 |
|
|
|
92 |
|
|
Acquisition-related costs |
|
|
- |
|
|
|
- |
|
|
|
213 |
|
|
Fair value remeasurement of earnout consideration |
|
|
(9 |
) |
|
|
86 |
|
|
|
- |
|
|
Amortization of purchased intangible assets |
|
|
1,384 |
|
|
|
1,464 |
|
|
|
1,419 |
|
| Total
operating expenses |
|
|
15,671 |
|
|
|
14,559 |
|
|
|
15,407 |
|
| Loss from
operations |
|
|
(1,574 |
) |
|
|
(761 |
) |
|
|
(1,371 |
) |
| Interest
expense, net |
|
|
(338 |
) |
|
|
(404 |
) |
|
|
(262 |
) |
| Other income
(loss), net |
|
|
19 |
|
|
|
(52 |
) |
|
|
34 |
|
| Loss before
income taxes |
|
|
(1,893 |
) |
|
|
(1,217 |
) |
|
|
(1,599 |
) |
| Provision
(benefit) for income taxes |
|
|
(7 |
) |
|
|
436 |
|
|
|
54 |
|
| Net
loss |
|
$ |
(1,886 |
) |
|
$ |
(1,653 |
) |
|
$ |
(1,653 |
) |
| Net loss per
share - basic and diluted |
|
$ |
(0.05 |
) |
|
$ |
(0.05 |
) |
|
$ |
(0.05 |
) |
|
Weighted-average common shares - basic and diluted |
|
|
36,982 |
|
|
|
36,719 |
|
|
|
35,406 |
|
| |
|
|
|
|
|
|
| |
| LANTRONIX,
INC. |
| UNAUDITED
RECONCILIATION OF NON-GAAP ADJUSTMENTS |
| (In
thousands, except per share data) |
| |
|
|
|
|
|
|
| |
|
Three Months Ended |
| |
|
September 30, |
|
June 30, |
|
September 30, |
| |
|
2023 |
|
2023 |
|
2022 |
| |
|
|
|
|
|
|
|
GAAP net loss |
|
$ |
(1,886 |
) |
|
$ |
(1,653 |
) |
|
$ |
(1,653 |
) |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
Share-based compensation |
|
|
41 |
|
|
|
(1 |
) |
|
|
51 |
|
|
Employer portion of withholding taxes on stock grants |
|
|
4 |
|
|
|
- |
|
|
|
12 |
|
|
Amortization of manufacturing profit in acquired inventory |
|
|
317 |
|
|
|
44 |
|
|
|
24 |
|
|
Depreciation and amortization |
|
|
86 |
|
|
|
102 |
|
|
|
130 |
|
|
Total adjustments to cost of revenue |
|
|
448 |
|
|
|
145 |
|
|
|
217 |
|
|
Selling, general and administrative: |
|
|
|
|
|
|
|
Share-based compensation |
|
|
1,273 |
|
|
|
414 |
|
|
|
1,405 |
|
|
Employer portion of withholding taxes on stock grants |
|
|
37 |
|
|
|
14 |
|
|
|
132 |
|
|
Depreciation and amortization |
|
|
334 |
|
|
|
327 |
|
|
|
155 |
|
|
Total adjustments to selling, general and administrative |
|
|
1,644 |
|
|
|
755 |
|
|
|
1,692 |
|
|
Research and development: |
|
|
|
|
|
|
|
Share-based compensation |
|
|
428 |
|
|
|
414 |
|
|
|
332 |
|
|
Employer portion of withholding taxes on stock grants |
|
|
13 |
|
|
|
5 |
|
|
|
22 |
|
|
Depreciation and amortization |
|
|
108 |
|
|
|
84 |
|
|
|
64 |
|
|
Total adjustments to research and development |
|
|
549 |
|
|
|
503 |
|
|
|
418 |
|
|
Restructuring, severance and related charges |
|
|
20 |
|
|
|
29 |
|
|
|
92 |
|
|
Acquisition related costs |
|
|
- |
|
|
|
- |
|
|
|
213 |
|
|
Fair value remeasurement of earnout consideration |
|
|
(9 |
) |
|
|
86 |
|
|
|
- |
|
|
Amortization of purchased intangible assets |
|
|
1,384 |
|
|
|
1,464 |
|
|
|
1,419 |
|
|
Total non-GAAP adjustments to operating expenses |
|
|
3,588 |
|
|
|
2,837 |
|
|
|
3,834 |
|
|
Interest expense, net |
|
|
338 |
|
|
|
404 |
|
|
|
262 |
|
|
Other (income) expense, net |
|
|
(19 |
) |
|
|
52 |
|
|
|
(34 |
) |
|
Provision (benefit) for income taxes |
|
|
(7 |
) |
|
|
436 |
|
|
|
54 |
|
| Total
non-GAAP adjustments |
|
|
4,348 |
|
|
|
3,874 |
|
|
|
4,333 |
|
| Non-GAAP net
income |
|
$ |
2,462 |
|
|
$ |
2,221 |
|
|
$ |
2,680 |
|
| |
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Non-GAAP net
income per share - diluted |
|
$ |
0.07 |
|
|
$ |
0.06 |
|
|
$ |
0.07 |
|
| |
|
|
|
|
|
|
| Denominator
for GAAP net income per share - diluted |
|
|
36,982 |
|
|
|
36,719 |
|
|
|
35,406 |
|
| Non-GAAP
adjustment |
|
|
693 |
|
|
|
548 |
|
|
|
1,777 |
|
| Denominator
for non-GAAP net income per share - diluted |
|
|
37,675 |
|
|
|
37,267 |
|
|
|
37,183 |
|
| |
|
|
|
|
|
|
| |
| LANTRONIX,
INC. |
| UNAUDITED
NET REVENUES BY PRODUCT LINE AND REGION |
| (In
thousands) |
| |
|
|
|
|
|
| |
Three Months Ended |
| |
September 30, 2023 |
|
June 30, 2023 |
|
September 30, 2022 |
|
Embedded IoT Solutions |
$ |
11,373 |
|
|
$ |
18,818 |
|
|
$ |
15,095 |
|
| IoT System
Solutions |
|
19,036 |
|
|
|
13,928 |
|
|
|
14,621 |
|
| Software
& Services |
|
2,622 |
|
|
|
2,178 |
|
|
|
2,079 |
|
| |
$ |
33,031 |
|
|
$ |
34,924 |
|
|
$ |
31,795 |
|
| |
|
|
|
|
|
| |
|
|
|
|
|
| |
Three Months Ended |
| |
September 30, 2023 |
|
June 30, 2023 |
|
September 30, 2022 |
|
Americas |
$ |
22,933 |
|
|
$ |
18,844 |
|
|
$ |
20,930 |
|
| EMEA |
|
6,591 |
|
|
|
6,800 |
|
|
|
5,201 |
|
| Asia Pacific
Japan |
|
3,507 |
|
|
|
9,280 |
|
|
|
5,664 |
|
| |
$ |
33,031 |
|
|
$ |
34,924 |
|
|
$ |
31,795 |
|
| |
|
|
|
|
|
Lantronix (NASDAQ:LTRX)
Historical Stock Chart
From Mar 2024 to Apr 2024
Lantronix (NASDAQ:LTRX)
Historical Stock Chart
From Apr 2023 to Apr 2024
