Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF

THE SECURITIES EXCHANGE ACT OF 1934

For the month of August 2023
Commission File No.: 000-30668

NOVA LTD.

(Translation of registrant’s name into English)

5 David Fikes Street, Rehovot, Israel

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____

Attached hereto and incorporated by way of reference herein is a press release issued by the Registrant and entitled: “Nova Reports Second Quarter 2023 Financial Results”.

The GAAP financial statements tables included in the press release attached hereto are hereby incorporated by reference into the Registrant’s registration statements on Form S-8, filed with the Securities and Exchange Commission on the following dates: November 5, 2007 (File No. 333-147140); October 25, 2012 (File No. 333-184585), March 6, 2015 (File No. 333-202550); and August 25, 2017 (File No. 333-220158).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: August 3, 2023

	NOVA LTD.
	(Registrant)
	By: /s/ Dror David

	Dror David
	Chief Financial Officer

Company Contact:

Dror David, Chief Financial Officer

Tel: +972-73-229-5760

E-mail - investors@novami.com

Nova website link - https://www.novami.com/

Investor Relations Contact:

Miri Segal MS-IR LLC

Tel: +917-607-8654

E-mail - msegal@ms-ir.com

Nova Reports Second Quarter 2023 Financial Results

Rehovot, Israel - August 03, 2023 - Nova (Nasdaq: NVMI) today announced financial results for the second quarter, the three-month period ended June 30, 2023.

Second Quarter 2023 Highlights:

•

Quarterly revenue of $122.7 million, above the midpoint of guidance range of $117 to $125 million and down 13% year over year.

•

GAAP net income of $29.9 million, or $0.94 per diluted share, higher than the company guidance of $0.75 to $0.89 and down 14% year over year on a per-share basis.

•

Non-GAAP net income of $33.8 million, or $1.06 per diluted share, reaching the top of the company’s guidance range of $0.92 to $1.06 and down 15% year over year on a per-share basis.

•

Continued adoption of advanced dimensional and materials product portfolio, including the Elipson and multiple procurements of Nova’s newest Veraflex model by a leading Memory customer.

•

Heightened interest in Nova’s unique technology offerings, including advanced packaging solutions, manifested by multiple evaluation processes at leading customers.

GAAP Results (K)

	Q2 2023	Q1 2023	Q2 2022
Revenues	$122,702	$132,193	$141,628
Net Income	$29,926	$34,627	$34,878
Earnings per Diluted Share	$0.94	$1.09	$1.09

Non-GAAP Results (K)

	Q2 2023	Q1 2023	Q2 2022
Net Income	$33,814	$39,075	$39,546
Earnings per Diluted Share	$1.06	$1.23	$1.24

A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements included in this release. See also "Use of Non-GAAP Adjusted Financial Measures" section.

Management Comments

“Nova's results for the quarter met our expectations, highlighting the resilience of our portfolio, our wide exposure to new advanced applications, a well-maintained operational model, an effective combination of customers' focus and our roadmap of continuous investment in every division,” said Gaby Waisman, President and CEO. “The value of our broad Materials and Dimensional portfolio propels increased traction with several notable achievements this quarter, including new penetrations and additional orders following successful evaluations of our new portfolio products. These opportunities will allow us to broaden our position and capitalize on larger opportunities once the industry fully recovers.”

2023 Third Quarter Financial Outlook

Management provided an outlook for the third quarter, the period ending September 30, 2023. Based on current estimates, management expects:

•

$119 million to $126 million in revenue

•

$0.83 to $0.94 in diluted GAAP EPS

•

$1.02 to $1.13 in diluted non-GAAP EPS

2023 Second Quarter Results

Total revenues for the second quarter of 2023 were $122.7 million, a decrease of 7% compared with the first quarter of 2023 and a decrease of 13% compared with the second quarter of 2022.

Gross margin in the second quarter of 2023 was 57%, compared with 58% in the first quarter of 2023 and 56% in the second quarter of 2022.

Operating expenses in the second quarter of 2023 were $40.9 million, compared with $41.5 million in the first quarter of 2023 and $42.1 million in the second quarter of 2022.

On a GAAP basis, the Company reported net income of $29.9 million, or $0.94 per diluted share, in the second quarter of 2023. This is compared with net income of $34.6 million, or $1.09 per diluted share, in the first quarter of 2023, and net income of $34.9 million, or $1.09 per diluted share, in the second quarter of 2022.

On a non-GAAP basis, the Company reported net income of $33.8 million, or $1.06 per diluted share, in the second quarter of 2023. This is compared with net income of $39.1 million, or $1.23 per diluted share, in the first quarter of 2023, and net income of $39.5 million, or $1.24 per diluted share, in the second quarter of 2022.

Conference Call Information

Nova will host a conference call today, August 03, 2023, at 8:30 a.m. Eastern Time, to discuss the Company’s second quarter 2023 financial results and outlook. To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls five minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

U.S. TOLL-FREE Dial-in Number: 1-877-300-8521

ISRAEL TOLL-FREE Dial-in Number: 1809-213-284

INTERNATIONAL Dial-in Number: 1-412-317-6026

At:

8:30 a.m. Eastern Time

5:30 a.m. Pacific Time

3:30 p.m. Israel Time

The conference call will also be webcast live from a Link on Nova's website at https://www.novami.com/investors/events/.

A replay of the conference call will be available from August 3, 2023, at 11:30 a.m. Eastern Time until August 10, 2023, at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:

Replay Dial-in U.S. TOLL-FREE: 1-844-512-2921

Replay Dial-in INTERNATIONAL : 1-412-317-6671

Replay Pin Number: 10180161

A replay will also be available for 90 days on Nova's website link at https://www.novami.com/investors/events/.

About Nova

Nova is a leading innovator and key provider of material, optical and chemical metrology solutions for advanced process control in semiconductor manufacturing. Nova delivers continuous innovation by providing state-of-the-art, high-performance metrology solutions for effective process control throughout the semiconductor fabrication lifecycle. Nova’s product portfolio, which combines high-precision hardware and cutting-edge software, provides its customers with deep insight into developing and producing the most advanced semiconductor devices. Nova’s unique capability to deliver innovative solutions enables its customers to improve performance, enhance product yields and accelerate time to market. Nova acts as a partner to semiconductor manufacturers from its offices worldwide. Additional information may be found on Nova’s website link - https://www.novami.com/.

Nova is traded on the Nasdaq and TASE, Nasdaq ticker symbol NVMI.

Use of Non-GAAP Adjusted Financial Measures

This press release provides financial measures that exclude amortization of acquired intangible assets, acquisition-related expenses, inventory step-up and contingent consideration revaluation, stock-based compensation expenses, revaluation of operating lease liabilities, amortization of debt discount and issuance costs and tax effect of non-GAAP adjustment, as applicable, and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Nova's performance because they reflect our operational results and enhance management's and investors' ability to evaluate Nova's performance before charges or benefits considered by management to be outside Nova's ongoing operating results. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management believes that it is in the best interest of its investors to provide financial information that will facilitate comparison of both historical and future results and allow greater transparency to supplemental information used by management in its financial and operational decision making. A reconciliation of each GAAP to non-GAAP financial measure discussed in this press release is contained in the accompanying financial tables.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, such as statements regarding, but not limited to, anticipated growth opportunities and projections about our business and its future revenues, expenses and profitability. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied in those forward-looking statements. Factors that may affect our results, performance, circumstances or achievements include, but are not limited to, the following: catastrophic events such as the outbreak of COVID-19; increased information technology security threats and sophisticated computer crime; foreign political and economic risks; changes in U.S. trade policies; inability to protect our intellectual property; open source technology exposure; failure to compete effectively or to respond to rapid technological change; consolidation in our industry; difficulty in predicting the length and strength of any downturn or expansion period of the market we target; factors that adversely affect the pricing and demand for our product lines; dependency on a small number of large customers; dependency on a single manufacturing facility per product line; dependency on a limited number of suppliers; difficulty in integrating current or future acquisitions; lengthy sales cycle and customer delays in orders; political, economic, and military instability in Israel; risks related to our convertible notes; currency fluctuations; and quarterly fluctuations in our operating results. We cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading "Risk Factors" in Nova's Annual Report on Form 20-F for the year ended December 31, 2022, filed with the Securities and Exchange Commission on February 28, 2023. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Nova Ltd. does not assume any obligation to update the forward-looking information contained in this press release.

(Tables to Follow)

NOVA LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands) - (Unaudited)

	As of
	June 30,		December 31,
	2023		2022
ASSETS
Current assets
Cash and cash equivalents		129,190		111,121
Short-term interest-bearing bank deposits		99,036		95,305
Marketable securities		188,163		167,073
Trade accounts receivable, net		82,904		109,320
Inventories		149,001		116,600
Other current assets		16,220		13,527
Total current assets		664,514		612,946

Non-current assets
Marketable securities		148,379		153,462
Interest-bearing bank deposits and restricted cash		5,971		2,083
Deferred tax assets		23,756		20,097
Operating lease right-of-use assets		43,134		44,885
Property plant and equipment, net		60,471		55,886
Intangible assets, net		41,434		43,586
Goodwill		49,539		49,009
Other long-term assets		1,906		2,151
Total non-current assets		374,590		371,159
Total assets		1,039,104		984,105

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Convertible senior notes, net		197,030		-
Trade accounts payable		35,951		42,732
Deferred revenues		27,181		30,543
Operating lease current liabilities		5,728		5,968
Other current liabilities		47,323		54,825
Total current liabilities		313,213		134,068

Non-current liabilities
Convertible senior notes, net		-		196,394
Operating lease long-term liabilities		40,564		43,697
Long-term deferred tax liability		11,675		12,190
Other long-term liabilities		11,324		10,793
Total non-current liabilities		63,563		263,074
Shareholders' equity		662,328		586,963
Total liabilities and shareholders' equity		1,039,104		984,105

NOVA LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except per share data) - (Unaudited)

	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Revenues:
Products		95,627		114,120		200,958		224,032
Services		27,075		27,508		53,937		51,553
Total revenues		122,702		141,628		254,895		275,585
Total cost of revenues		53,044		62,595		107,971		121,877

Gross profit		69,658		79,033		146,924		153,708

Operating expenses:
Research and development, net		22,413		22,115		45,381		41,244
Sales and marketing		12,927		12,500		26,449		24,884
General and administrative		5,602		7,455		10,641		13,511
Total operating expenses		40,942		42,070		82,471		79,639

Operating income		28,716		36,963		64,453		74,069
Financing income, net		5,628		3,568		10,356		4,786

Income before taxes on income		34,344		40,531		74,809		78,855
Income tax expenses		4,418		5,653		10,256		9,815
Net income for the period		29,926		34,878		64,553		69,040

Earnings per share:
Basic		1.04		1.22		2.25		2.41
Diluted		0.94		1.09		2.02		2.16

Shares used in calculation of earnings per share (in thousands):
Basic		28,766		28,688		28,706		28,662
Diluted		31,928		31,902		31,927		31,963

NOVA LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands) - (Unaudited)

	Three months ended June 30,						Six months ended June 30,
	2023			2022			2023			2022
Cash flows from operating activities:

Net income		29,926			34,878			64,553			69,040

Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment		2,476			2,001			4,816			4,036
Amortization of intangible assets		1,475			1,513			2,919			3,126
Amortization of premium and accretion of discount on marketable securities, net		(621	)		715			(1,049	)		1,544
Amortization of debt discount and issuance costs		320			318			636			638
Share-based compensation		3,667			4,072			8,061			7,932
Net effect of exchange rate fluctuation		407			2,178			1,756			2,971
Changes in assets and liabilities:
Trade accounts receivable, net		18,064			(17,264	)		26,681			(16,794	)
Inventories		(14,689	)		(5,637	)		(35,024	)		(12,535	)
Other current and long-term assets		5,513			7,925			(2,718	)		(8,071	)
Deferred tax assets, net		(2,406	)		(2,331	)		(4,343	)		(4,940	)
Operating lease right-of-use assets		839			1,123			1,641			2,035
Trade accounts payable		(7,773	)		881			(7,273	)		(1,060	)
Deferred revenues		(3,055	)		5,266			(3,368	)		4,522
Operating lease liabilities		(1,617	)		(4,332	)		(3,262	)		(5,138	)
Other current and long-term liabilities		(8,288	)		(6,234	)		(6,618	)		(9,385	)
Accrued severance pay, net		(71	)		10			(169	)		71
Net cash provided by operating activities		24,167			25,082			47,239			37,992

Cash flows from investment activities:
Acquisition of subsidiary, net of acquired cash		-			-			-			(78,469	)
Change in short-term and long-term interest-bearing bank deposits		14,452			66,872			(8,610	)		116,504
Investment in marketable securities		(44,458	)		(34,691	)		(98,140	)		(51,527	)
Proceeds from maturity of marketable securities		42,423			18,428			84,315			34,198
Purchase of property and equipment		(3,274	)		(4,239	)		(6,032	)		(7,957	)
Net cash provided by (used in) investing activities		9,143			46,370			(28,467	)		12,749

Cash flows from financing activities:
Purchases of treasury shares		-			(4,270	)		(112	)		(4,270	)
Proceeds from exercise of options		115			82			115			82
Net cash provided by (used in) financing activities		115			(4,188	)		3			(4,188	)

Effect of exchange rate fluctuations on cash and cash equivalents		(310	)		(2,160	)		(1,306	)		(2,954	)

Changes in cash and cash equivalents and restricted cash		33,115			65,104			17,469			43,599
Cash and cash equivalents and restricted cash -beginning of period		96,075			105,193			111,721			126,698
Cash and cash equivalents - end of period		129,190			170,297			129,190			170,297

NOVA LTD.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(U.S. dollars in thousands, except percentage and per share data) - (Unaudited)

	Three months ended
	June 30, 2023			March 31, 2023			June 30, 2022
GAAP gross profit		69,658			77,266			79,033
Stock-based compensation*		1,071			1,165			1,021
Amortization of acquired intangible assets		1,368			1,338			1,355
Acquisition related inventory step-up		-			-			366
Non-GAAP gross profit		72,097			79,769			81,775
GAAP gross margin as a percentage of revenues		57	%		58	%		56	%
Non-GAAP gross margin as a percentage of revenues		59	%		60	%		58	%

GAAP operating income		28,716			35,737			36,963
Stock-based compensation*		3,667			4,394			4,072
Acquisition-related inventory step-up		-			-			366
Acquisition-related expenses and contingent consideration revaluation		-			-			2,392
Amortization of acquired intangible assets		1,475			1,444			1,513
Non-GAAP operating income		33,858			41,575			45,306
GAAP operating margin as a percentage of revenues		23	%		27	%		26	%
Non-GAAP operating margin as a percentage of revenues		28	%		31	%		32	%

GAAP net income		29,926			34,627			34,878
Stock-based compensation*		3,667			4,394			4,072
Acquisition-related inventory step-up		-			-			366
Acquisition-related expenses and contingent consideration revaluation		-			-			2,392
Amortization of acquired intangible assets		1,475			1,444			1,513
Amortization of debt discount and issuance costs		320			316			318
Revaluation of operating lease liabilities		(768	)		(822	)		(3,350	)
Tax effect of non-GAAP adjustments		(806	)		(884	)		(643	)
Non-GAAP net income		33,814			39,075			39,546

GAAP basic earnings per share		1.04			1.21			1.22
Non-GAAP basic earnings per share		1.18			1.36			1.38

GAAP diluted earnings per share		0.94			1.09			1.09
Non-GAAP diluted earnings per share		1.06			1.23			1.24

Shares used for calculation of earnings per share (in thousands):
Basic		28,766			28,678			28,688
Diluted		31,928			31,824			31,902

* Stock-based compensation for the three months ended June 30, 2023, included in – Cost of revenues - 1,071; Research and development, net – 1,403; Sales and marketing – 688; General and administrative – 505.

NOVA LTD.
SUPPLEMENTAL INFORMATION - RECONCILIATION OF SECOND QUARTER 2023
GAAP TO NON-GAAP GUIDANCE

(U.S. dollars) (Unaudited)

	Low			High
Estimated GAAP net income per diluted share		0.83			0.94
Estimated non-GAAP items:
Stock-based compensation		0.18			0.18
Amortization of acquired intangible assets		0.04			0.04
Amortization of issuance costs		0.01			0.01
Tax effect of non-GAAP adjustments		(0.04	)		(0.04	)
Estimated non-GAAP net income per diluted share		1.02			1.13