Conference Call To Be Held Today at 4:30 pm
Eastern Time
Inpixon (NASDAQ: INPX), a leading indoor positioning and data
analytics company, today reported financial results for the first
quarter ended March 31, 2017 and provided an update on corporate
developments.
First Quarter 2017 Financial Highlights:
- 2017 Q1 revenue of $13.5 million
- 2017 Q1 gross margin of 24%
- 2017 Q1 GAAP net loss of $2.79 per
share
- 2017 Q1 Proforma Non-GAAP net loss1 of
$2.03 per share
- 2017 Q1 Non-GAAP Adjusted EBITDA1 loss
of $3.3 million
“The renewal of our contract with the FBI, the extension of our
contract with the Army and this week’s announcement of an
approximately $2.5 million project win with a leading health
insurer are encouraging and we believe show traction with both our
commercial and government customer base,” said Nadir Ali, Inpixon’s
CEO. “We anticipate a more significant impact with government
customers in Q3 and Q4 from the Integrio acquisition as we approach
the government fiscal year end. I look forward to our earnings call
today when we will have a conversation with our CTO, Craig Harper,
about where our Indoor Positioning Analytics product is headed and
where we see industry trends in the space.”
First Quarter 2017 Financial Results
Revenue: Total revenues for the quarter ended March 31, 2017
were $13.5 million compared to $14.1 million for the comparable
period in the prior year. For the three months ended March 31,
2017, Indoor Positioning Analytics revenue was $981,000 compared to
$1 million for the prior year period. Infrastructure revenue was
$12.5 million for the three months ended March 31, 2017, and $13.1
million for the prior year period. This decline in revenue is
primarily attributable to a delay in order processing at the end of
the quarter. We experienced credit constraints that were compounded
by the Integrio acquisition, that pushed a substantial amount of
infrastructure related orders to the 2nd Quarter of 2017. The
Company is addressing these credit limitations with the relevant
vendors/distributors to minimize impact in future quarters.
Gross Profit: Total gross profit for the quarter ended March 31,
2017 was $3.3 million, compared to $4.0 million for the comparable
period in the prior year. The gross profit margin for the quarter
ended March 31, 2017 was 24% compared to 28% during the prior year
period. This decline in gross profit margin relates to the impact
of infrastructure sales from the Inpixon Federal division, which
have a lower margin profile.
Net Loss: GAAP net loss attributable to stockholders for the
quarter ended March 31, 2017 was $6.1 million, compared to $4.3
million for the prior year period. GAAP net loss per share for the
three months ended March 31, 2017 was $2.79 compared to $2.57 for
the prior year period. This increase in net loss per share was
primarily attributable to lower gross profit, increase in
amortization of intangibles and depreciation costs, additional
costs incurred for the Integrio operations offset by a reduction in
operating expenses related to Inpixon USA.
Non-GAAP net loss1: For the quarter ended March 31, 2017,
pro-forma non-GAAP net loss was $4.4 million, compared to a
non-GAAP net loss of $2.9 million for the prior year period. For
the quarter ended March 31, 2017, non-GAAP net loss per share was
$2.03, compared to a non-GAAP net loss per share of $1.71 for the
prior year period. Non-GAAP net loss per share is defined as net
loss per basic and diluted share adjusted for non-cash items
including stock based compensation, amortization of intangibles and
one time charges including severance costs, change in the fair
value of shares to be issued, change in the fair value of
derivative liability and acquisition costs.
Non-GAAP adjusted EBITDA1: Total non-GAAP Adjusted EBITDA for
the three months ended March 31, 2017 was a loss of $3.3 million
compared to a loss of $2.5 million for the prior year period.
Non-GAAP adjusted EBITDA is defined as net income (loss) before
interest, provision for (benefit from) income taxes, and
depreciation and amortization plus adjustments for other income or
expense items, non-recurring items and non-cash stock-based
compensation.
1A reconciliation of GAAP to non-GAAP financial measures is
provided in the financial statement tables included in this press
release. An explanation of these measures is also included under
the heading “Non-GAAP Financial Measures.”
First Quarter 2017 Business Highlights and Recent
Developments
- Inpixon Announces Purchase Order From
Leading Health Insurer
- FBI Renews Contract with Inpixon
Federal
- U.S. Army Extends Contract With
Inpixon
All results summarized in this press release (including the
financial statement tables) should be considered preliminary, are
qualified in their entirety by the financial statement tables
included in this press release and are subject to change. Please
refer to Inpixon’s Quarterly Report on Form 10-Q for the quarter
ended March 31, 2017, which will be filed with the U.S. Securities
and Exchange Commission on or before May 15, 2017.
Conference Call Information
Management will host a conference call on Thursday, May 11,
2017, at 4:30 p.m. Eastern Time to review financial results and
corporate highlights. Following management’s formal remarks, there
will be a question and answer session.
To listen to the conference call, interested parties within the
U.S. should call 1-844-824-3831. International callers should call
+1-412-317-5141. All callers should ask for the Inpixon conference
call. The conference call will also be available through a live
webcast, which can be accessed at
http://client.irwebkit.com/inpixon.
A replay of the call will be available approximately one hour
after the end of the call through June 11, 2017. The replay can be
accessed via Inpixon’s website or by dialing 1-877-344-7529 (U.S.)
or +1-412-317-0088 (international). The replay conference playback
code is 10107128.
About Inpixon
Inpixon (NASDAQ: INPX) is a leader in Indoor Positioning and
Data Analytics. Inpixon sensors are designed to find all accessible
cellular, Wi-Fi, and Bluetooth devices anonymously. Paired with a
high performance, data analytics platform, this technology delivers
visibility, security, and business intelligence on any commercial
or government premises world-wide. Inpixon’s products,
infrastructure solutions, and professional services group help
customers take advantage of mobile, big data, analytics, and the
Internet of Things (IoT) to uncover the untold stories of the
indoors. For the latest insight on Indoor Positioning and Data
Analytics, follow Inpixon on LinkedIn and @_Inpixon on Twitter.
Safe Harbor Statement
All statements in this release that are not based on historical
fact are “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995 and the provisions
of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
While management has based any forward-looking statements included
in this release on its current expectations, the information on
which such expectations were based may change. These
forward-looking statements rely on a number of assumptions
concerning future events and are subject to a number of risks,
uncertainties and other factors, many of which are outside of the
control of Inpixon and its subsidiaries, which could cause actual
results to materially differ from such statements. Such risks,
uncertainties, and other factors include, but are not limited to,
the fluctuation of global economic conditions, the performance of
management and employees, the Company’s ability to obtain
financing, competition, general economic conditions and other
factors that are detailed in Inpixon’s periodic and current reports
available for review at www.sec.gov. Furthermore, we operate in a
highly competitive and rapidly changing environment where new and
unanticipated risks may arise. Accordingly, investors should not
place any reliance on forward-looking statements as a prediction of
actual results. We disclaim any intention to, and undertake no
obligation to, update or revise forward-looking statements.
Non-GAAP Financial Measures
Management believes that certain financial measures not in
accordance with generally accepted accounting principles in the
United States (“GAAP"”) are useful measures of operations. EBIDTA,
Adjusted EBITDA and pro forma net loss per share are non-GAAP
measures. Inpixon defines “EBITDA” as net income (loss) before
interest, provision for (benefit from) income taxes, and
depreciation and amortization. Management uses Adjusted EBITDA as
the matrix in which it manages the business and Inpixon defines
“Adjusted EBITDA” as EBITDA plus adjustments for other income or
expense items, non-recurring items and non-cash stock-based
compensation. Inpixon defines “pro forma net loss per share” as
GAAP net loss per share adjusted for stock-based compensation,
amortization of intangibles, change in the fair value of shares to
be issued, change in the fair value of derivative liability and
one-time non-recurring charges such as severance costs and
acquisition costs.
Management provides Adjusted EBITDA and pro forma net loss per
share measures so that investors will have the same financial
information that management uses, which may assist investors in
assessing Inpixon’s performance on a period-over-period basis.
Adjusted EBITDA or pro forma net loss per share is not a measure of
financial performance under GAAP, and should not be considered an
alternative to net income (loss) or any other measure of
performance under GAAP, or to cash flows from operating, investing
or financing activities as an indicator of cash flows or as a
measure of liquidity. Adjusted EBITDA and pro forma net loss per
share have limitations as analytical tools and should not be
considered either in isolation or as a substitute for analysis of
Inpixon’s results as reported under GAAP.
INPIXON AND SUBSIDIARIES CONDENSED
CONSOLIDATED BALANCE SHEETS (In thousands, except number of
shares and par value data)
March 31,
December 31,
2017
2016
(Unaudited)
(Audited)
ASSETS Current assets: Cash and cash equivalents $ 738 $
1,821 Accounts receivable, net 6,418 11,788 Notes and other
receivables 341 362 Inventory 782 1,061 Prepaid licenses and
maintenance contracts 10,907 13,321 Assets held for sale 23 23
Prepaid assets and other current assets 1,347 1,768
Total current assets 20,556 30,144 Prepaid licenses and maintenance
contracts, non-current 4,282 5,169 Property and equipment, net
1,278 1,385 Software development costs, net 2,183 2,058 Intangible
assets, net 16,308 17,691 Goodwill 9,028 9,028 Other assets
942 998 Total assets $ 54,577 $ 66,473
LIABILITIES AND
STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $
22,528 $ 23,027 Accrued liabilities 4,280 4,169 Deferred revenue
12,382 15,043 Short-term debt 4,618 6,887 Liabilities held for sale
2,046 2,041 Total current liabilities 45,854 51,167
Deferred revenue, non-current 4,932 5,960 Long-term debt 4,342
4,047 Other liabilities 374 371 Acquisition liability - Integrio
1,558 1,648 Acquisition liability - LightMiner -- 567
Total liabilities 57,060 63,760 Commitments and contingencies
Stockholders’ (deficit) equity: Preferred stock, $0.001 par value;
5,000,000 shares authorized; no shares issued -- -- or outstanding
Convertible Series 1 Preferred Stock - $1,000.00 stated value;
5,000,000 shares authorized; 2,250 issued and outstanding at March
31, 2017 and December 31, 2016. Liquidation preference of
$2,250,000 at March 31, 2017 and December 31, 2016. 1,340 1,340
Common stock, $0.001 par value; 50,000,000 shares authorized;
2,197,667 and 2,171,886 issued and 2,181,745 and 2,155,964
outstanding at March 31, 2017 and December 31, 2016, respectively 2
2 Additional paid-in capital 64,997 64,148 Treasury stock, at cost,
15,922 shares (695) (695) Due from Sysorex Consulting Inc. (666)
(666) Accumulated other comprehensive income 63 52 Accumulated
deficit (65,525) (59,473) Stockholders’ equity
attributable to Inpixon (484) 4,708 Non-controlling interest
(1,999) (1,995) Total stockholders' (deficit) equity
(2,483) 2,713 Total liabilities and stockholders’ (deficit)
equity $ 54,577 $ 66,473
INPIXON AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS (In thousands, except per share
data) For the Three Months
Ended March 31, 2017 2016 (Unaudited) (Unaudited) Revenues Products
$ 9,448 $ 10,348 Services 4,033 3,739 Total Revenues
13,481 14,087 Cost of Revenues Products 8,054 8,042
Services 2,139 2,098 Total Cost of Revenues
10,193 10,140 Gross Profit 3,288 3,947 Operating expenses:
Research and development 558 587 Sales and marketing 2,040 2,501
General and administrative 4,658 3,965 Acquisition related costs 3
20 Amortization of intangibles 1,383 1,056 Total
operating expenses 8,642 8,129 Loss from operations
(5,354) (4,182) Other income (expense) Interest expense (684) (143)
Change in fair value of shares to be issued -- (1) Change in fair
value of derivative liability 56 -- Other (expense) income
(65) 20 Total other income (expense) (693)
(124) Loss from continuing operations (6,047) (4,306) Loss from
discontinued operations, net of tax (9) -- Net loss
(6,056) (4,306) Net loss attributable to non-controlling interest
(4) (4) Net loss attributable to stockholders of
Inpixon $ (6,052) $ (4,302) Comprehensive loss Net Loss (6,056)
(4,306)
Unrealized foreign exchange gain/(loss)
from cumulativetranslation adjustments
11 17 Comprehensive loss $ (6,045) $ (4,289) Net loss per
share - basic and diluted $ (2.79) $ (2.57) Weighted average common
shares outstanding: Basic and Diluted 2,170,909
1,673,714
INPIXON AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In
thousands) For the Three
Months Ended March 31, 2017 2016
(Unaudited)
Cash flows from operating activities: Net loss $ (6,056) $ (4,306)
Adjustment to reconcile net loss to net cash used in operating
activities: Depreciation and amortization 401 263 Amortization of
intangible assets 1,383 1,056 Stock based compensation 283 364
Change in fair value of shares to be issued -- 1 Change in fair
value of derivative liability (56) -- Amortization of technology 17
-- Amortization of deferred financing costs 43 -- Amortization of
debt discount 294 -- Provision for doubtful accounts -- 212 Other
13 2 Changes in operating assets and liabilities: Accounts
receivable and other receivables 5,392 787 Inventory 278 (67) Other
current assets 420 140 Prepaid licenses and maintenance contracts
3,301 446 Other assets (3) 1 Accounts payable (499) (848) Accrued
liabilities 168 (1,323) Deferred revenue (3,689) 3,371 Other
liabilities (82) (103) Total Adjustments 7,664 4,302
Net Cash Provided by (Used in) Operating Activities 1,608 (4) Cash
Flows Used in Investing Activities: Purchase of property and
equipment (82) (48) Investment in capitalized software (351)
(414) Net Cash Flows Used in Investing Activities (433)
(462) Cash Flows Provided by Financing Activities Advances
(repayment) of line of credit (2,269) (588) Repayment of term loan
-- (167) Repayments to related party -- (3) Net Cash
Used in Financing Activities (2,269) (758) Effect of Foreign
Exchange Rate on Changes on Cash 11 17 Net Decrease in Cash and
Cash Equivalents (1,083) (1,207) Cash and Cash Equivalents -
Beginning of period 1,821 4,060 Cash and Cash
Equivalents - End of period $ 738 $ 2,853
Reconciliation of Non-GAAP Financial Measures:
(In thousands)
Three Months Ended
March 31, 2017 2016 Net loss attributable to
common stockholders $ (6,052) $ (4,302) Adjustments: Non-recurring
one-time charges: Acquisition transaction/financing costs 3 20
Change in the fair value of shares to be issued -- 1 Change in the
fair value of derivative liability (56) -- Severance 27 -- Stock
based compensation - acquisition costs 7 -- Stock-based
compensation – compensation and related benefits 276 364 Interest
expense 684 143 Depreciation and amortization 1,785 1,319 Adjusted
EBITDA $ (3,326) $ (2,455) (In thousands,
except share data)
Three Months Ended March
31, 2017 2016 Net loss attributable to common
stockholders $ (6,052) $ (4,302) Adjustments: Non-recurring
one-time charges: Acquisition transaction/financing costs 3 20
Change in the fair value of shares to be issued -- 1 Change in the
fair value of derivative liability (56) -- Severance 27 -- Stock
based compensation - acquisition costs 7 -- Stock-based
compensation – compensation and related benefits 276 364
Amortization of intangibles 1,383 1,056 Proforma non-GAAP net loss
$ (4,412) $
(2,861)
Proforma non-GAAP net loss per basic and diluted common share $
(2.03) $ (1.71) Weighted average basic and diluted common shares
outstanding 2,170,909 1,673,714
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170511006400/en/
Inpixon Investor Relations:CORE IRScott Arnold,
+1-516-222-2560Managing Directorwww.coreir.comorMedia
Contact:PAN CommunicationsHilary Katulak,
+1-617-502-4347hkatulak@pancomm.com
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