2022 Revenue Expected to Be Up Approximately
106% Year-Over-Year
SAN
JOSE, Calif., Jan. 18,
2023 /CNW/ -- (TSXV:SEV) (OTCQB:SPVNF) Spectra7
Microsystems Inc. ("Spectra7" or the "Company"), a
leading provider of high-performance analog semiconductor products
for broadband connectivity markets, today announced preliminary
selected and unaudited financial results and a business update for
the three months ended December 31,
2022, and its initial outlook for Q1 2023. Unless otherwise
indicated, all dollar amounts in this press release are expressed
in US dollars.
- Preliminary fourth quarter revenue of $3.0 million, up approximately 14%
year-over-year1
- Preliminary revenue for 2022 of $11.3
million, up approximately 106% compared to $5.5 million in the previous year1
- Preliminary fourth quarter gross margin2 as a
percentage of revenue in the fourth quarter increased to in excess
of 58%1
- Preliminary fourth quarter non-IFRS operating
expenses3 were $1.9
million, flat from $1.9
million year-over-year while the Company continues to
control its spending. 1
- Based on current order trends and a high backlog, Spectra7
expects revenue for the first quarter of 2023 to be in the range of
$3.0 million to $3.2 million. 4
"We had a very strong 2022, doubling our revenue year over year
to approximately $11.3 million, led
by our AR/VR products and early ramp in hyperscale product sales
with key datacenter customers. This enabled the Company to approach
EBITDA5 break-even in the fourth quarter," said
Raouf Halim, Chief Executive
Officer. "Our visibility into 2023 has improved significantly as we
start the new year with a high order backlog from a growing list of
end customers. We also expect supply availability to improve
steadily throughout 2023. Coupled with growth in our datacenter
customer orders, we expect to achieve EBITDA5
profitability in the year ahead."4
Preliminary fourth quarter 2022 revenue
results1
The Company expects to report revenue of approximately
$3.0 million for the fourth quarter
of 2022, compared with $2.7 million
in the third quarter of 2022 and $2.6
million in the fourth quarter of 2021. This represents an
increase of approximately 11% from the prior quarter and
approximately 14% year-over-year.
Gross margin2 as a percentage of revenue in the
fourth quarter is forecasted to be in excess of 58% compared with
55% in the third quarter of 2022 and 59% in the fourth quarter of
2021. Non-IFRS operating expenses3 are expected to be
$1.9 million4 as the
Company continues to focus on its production ramp to meet rapidly
growing demand from its data center customers. Third quarter 2022
non-IFRS operating expenses were $1.9
million.
The Company expects EBITDA5 loss in the fourth
quarter of 2022 to be approximately $80,000, improving from $201,000 EBITDA5 loss in the third
quarter of 2022 and in line with its goal to become EBITDA positive
in 2023. EBITDA5 loss in the fourth quarter of 2021 was
$147,000.
Following its customary reporting timeline, Spectra7 anticipates
releasing its audited annual financial results for the year ended
December 31, 2022 on or before the
applicable regulatory deadline of May 1,
2023.
NOTES:
1 All information herein is subject to change based
on the reported audited annual financial results, expected to be
reported no later than May 1,
2023.
2 Gross margin is a non-GAAP measure which is computed
as revenue less cost of sales divided by revenue. Refer to "Revenue
and Gross Margin" in the Company's interim MD&A for the three
and nine months ended September 30,
2022, which is available on SEDAR at www.sedar.com (the
"Interim MD&A"), for reconciliation to measures reported
in the Company's financial statements in the previous quarter. A
reconciliation to measures reported in the Company's audit annual
financial statements for the year ended December 31, 2022 will be provided in the
Company's annual MD&A.
3 Non-IFRS operating expenses is
a non-GAAP measure which includes research and development, sales
and marketing, general and administrative expenses and depreciation
and amortization for capital equipment and right-of-use assets and
excludes share-based compensation expense, non-recurring
termination costs, interest and related financing costs, change in
fair value of warrant liabilities, foreign exchange gain/loss and
gain/loss from property and equipment disposal. Refer to "Non-GAAP
Measures" in the Interim MD&A for reconciliation to measures
reported in the Company's financial statements in the previous
quarter. A reconciliation to measures reported in the Company's
audit annual financial statements for the year ended December 31, 2022 will be provided in the
Company's annual MD&A.
4 This is
forward-looking information and is based on a number of assumptions
which includes the current and anticipated customer purchase orders
received, supply outlook and anticipated operational
expenditures. See "Cautionary Notes".
5 EBITDA or earnings before interest, tax,
depreciation, and amortization is a non-GAAP measure. EBITDA
excludes share-based compensation, amortization, depreciation,
interest, and tax expenses. Refer to "Non-GAAP Measures" in the
Interim MD&A for reconciliation to measures reported in the
Company's financial statements in the previous quarter. A
reconciliation to measures reported in the Company's audit annual
financial statements for the year ended December 31, 2022 will be provided in the
Company's annual MD&A.
ABOUT SPECTRA7 MICROSYSTEMS INC.
Spectra7 Microsystems Inc. is a high-performance analog
semiconductor company delivering unprecedented bandwidth, speed and
resolution to enable disruptive industrial design for leading
electronics manufacturers in virtual reality, augmented reality,
mixed reality, data centers and other connectivity markets.
Spectra7 is based in San Jose,
California with a design center in Cork, Ireland and a technical support location
in Dongguan, China. For more
information, please visit www.spectra7.com.
Neither the TSX Venture Exchange nor its regulation services
provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
CAUTIONARY NOTES
Certain statements contained in this press release constitute
"forward-looking statements". All statements other than statements
of historical fact contained in this press release, including,
without limitation, the Company's expected Q4 revenue, non-IFRS
operating expense and EBITDA results, expectation for 2022 revenue,
revenue improvement and supply availability, the Company's
expectation regarding product demand and revenue in 2023, and the
Company's strategy, plans, objectives, goals and targets, and any
statements preceded by, followed by or that include the words
"believe", "expect", "aim", "intend", "plan", "continue", "will",
"may", "would", "anticipate", "estimate", "forecast", "predict",
"project", "seek", "should" or similar expressions or the negative
thereof, are forward-looking statements. These statements are not
historical facts but instead represent only the Company's
expectations, estimates and projections regarding future events.
These statements are not guarantees of future performance and
involve assumptions, risks and uncertainties that are difficult to
predict. Therefore, actual results may differ materially from what
is expressed, implied or forecasted in such forward-looking
statements. Additional factors that could cause actual results,
performance or achievements to differ materially include, but are
not limited to the risk factors discussed in the Company's annual
information form for the year ended December
31, 2021. Management provides forward-looking statements
because it believes they provide useful information to investors
when considering their investment objectives and cautions investors
not to place undue reliance on forward-looking information.
Consequently, all of the forward-looking statements made in this
press release are qualified by these cautionary statements and
other cautionary statements or factors contained herein, and there
can be no assurance that the actual results or developments will be
realized or, even if substantially realized, that they will have
the expected consequences to, or effects on, the Company. These
forward-looking statements are made as of the date of this press
release and the Company assumes no obligation to update or revise
them to reflect subsequent information, events or circumstances or
otherwise, except as required by law.
For more information, please contact:
Matt Kreps
Darrow Associates
214-597-8200
ir@spectra7.com
Spectra7 Microsystems Inc.
Bonnie Tomei
Chief Financial Officer
669-212-1089
ir@spectra7.com
Spectra7 Microsystems Inc.
John Mitchell
Public Relations
650-269-3043
pr@spectra7.com
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SOURCE Spectra7 Microsystems Inc.