IVAC Intevac Inc

Intevac, Inc. (Nasdaq: IVAC) today reported financial results for the first quarter ended March 30, 2024.

Q1 Highlights:

• Continued strong demand for technology upgrades for hard disk drive (HDD) media resulted in sales of nearly $10 million and gross margin approaching 44% for the quarter.
• New orders exceeded $20 million for the quarter, and included HDD technology upgrade bookings from multiple customers, including initial HAMR (heat-assisted magnetic recording) upgrade orders from a leading data storage company.
• Completed agreement related to payment terms with a major HDD customer.
• Resolved our JDA agreement in order to work directly with key OEMs and their direct suppliers, which led to the April shipment of an initial TRIO™ system to a display cover glass finishing facility in Asia.
• Total cash, restricted cash and investments were $65 million at quarter end, and with more meaningful accounts receivable collections quarter-to-date the current balance is over $75 million.

“We are pleased to demonstrate our critical role in the HDD ecosystem with Q1 revenues approaching $10 million, consisting primarily of HAMR technology upgrade sales,” commented Nigel Hunton, president and chief executive officer. “Our HDD backlog of $53 million at quarter-end reflects continued strong bookings for upgrades in support of our customers’ strategic technology roadmaps, and supports the visibility and longevity of a multi-year HAMR investment cycle, which in Q1 expanded for the first time to multiple HDD customers. We expect these strategic investments to boost areal density will continue to drive strength in our HDD business for several years, and with continued advancements in reducing the cost-per-bit of HDD storage we agree with industry expectations of robust demand for hard drive media.

“With our first TRIO shipping into the field earlier this month, the level of excitement amongst Intevac employees is real,” continued Mr. Hunton. “Since achieving qualification of the initial TRIO system just prior to year-end 2023, we have continued to navigate the complexities of the display cover glass ecosystem for consumer electronics. We successfully reached an agreement to deliver our first TRIO system in April, which is expected to convert to revenue upon successful end-customer qualification. We continue to believe the TRIO platform will be our major growth driver for the future, and the strong end-market customer demand and pull for the impressive capabilities and performance of our system helped drive the successful shipment of the first system earlier this month.” Mr. Hunton concluded, “We remain steadfast in our focus to successfully transform Intevac into a consistently profitable company with a strong growth trajectory, and our decision to focus on the long-term potential of each of our flagship systems during the first quarter culminated in both an immediate return to HDD upgrade deliveries and the collection of overdue receivables, as well as the shipment of our first TRIO. I wish to thank the incredible Intevac team of employees who are executing phenomenally and we also wish to thank our stockholders for their continued support.”

($ Millions, except per share amounts)

 

Q1 2024

Q1 2023

 

GAAP Results

Non-GAAP Results

GAAP Results

Non-GAAP Results

Net Revenues

 

$

9.6

 

$

9.6

 

$

11.5

 

$

11.5

 

Operating Loss

 

$

(4.4

)

$

(4.4

)

$

(4.5

)

$

(4.5

)

Net Loss

 

$

(1.6

)

$

(2.7

)

$

(3.9

)

$

(4.2

)

Net Loss per Diluted Share

 

$

(0.06

)

$

(0.10

)

$

(0.15

)

$

(0.16

)

Intevac’s non-GAAP adjusted results exclude the impact of the following, where applicable: discontinued operations. A reconciliation of the GAAP and non-GAAP adjusted results is provided in the financial table included in this release. See also “Use of Non-GAAP Financial Measures” section.

First Quarter 2024 Summary

Revenues were $9.6 million, compared to $11.5 million in the first quarter of 2023, and consisted of HDD upgrades, spares and service. Gross margin was 43.7%, compared to 40.9% in the first quarter of 2023. Operating expenses were $8.7 million, compared to $9.2 million in the first quarter of 2023. The operating loss was $4.4 million compared to $4.5 million in the first quarter of 2023.

The net loss for the quarter was $1.6 million, or $0.06 per diluted share, compared to a net loss of $3.9 million, or $0.15 per diluted share, in the first quarter of 2023. The non-GAAP net loss for the first quarter of 2024 was $2.7 million, or $0.10 per diluted share, compared to a non-GAAP net loss of $4.2 million, or $0.16 per diluted share, in the first quarter of 2023.

Order backlog was $53.1 million on March 30, 2024, compared to $42.4 million on December 30, 2023 and $120.7 million on April 1, 2023. Backlog at March 30, 2024 and December 30, 2023 did not include any 200 Lean HDD systems. Backlog at April 1, 2023 included eleven 200 Lean HDD systems.

The Company ended the quarter with $65.5 million of total cash, cash equivalents, restricted cash and investments and $114.0 million in tangible book value.

Use of Non-GAAP Financial Measures

Intevac’s non-GAAP results exclude the impact, where applicable, of discontinued operations. A reconciliation of the GAAP and non-GAAP results is provided in the financial tables included in this release.

Management uses non-GAAP results to evaluate the Company’s operating and financial performance in light of business objectives and for planning purposes. These measures are not in accordance with GAAP and may differ from non-GAAP methods of accounting and reporting used by other companies. Intevac believes these measures enhance investors’ ability to review the Company’s business from the same perspective as the Company’s management and facilitate comparisons of this period’s results with prior periods. The presentation of this additional information should not be considered a substitute for results prepared in accordance with GAAP.

Conference Call Information

The Company will discuss its financial results and outlook in a conference call today at 5:30 a.m. PDT (8:30 a.m. EDT). To participate in the teleconference, please call toll-free (877) 407-0989 prior to the start time, and reference meeting number 13745582. For international callers, the dial-in number is +1 (201) 389-0921. You may also listen live via the Internet at https://www.webcast-eqs.com/login/intevac042524 or on the Company's investor relations website at https://ir.intevac.com/.

About Intevac

Founded in 1991, we are a leading provider of thin-film process technology and manufacturing platforms for high-volume manufacturing environments. As a long-time supplier to the hard disk drive (HDD) industry, our industry-leading 200 Lean® platform supports the majority of the world’s capacity for HDD disk media production, as well as all technology upgrade initiatives currently underway in support of next-generation HAMR (heat-assisted magnetic recording) media. With over 30 years of leadership in designing, developing, and manufacturing high-productivity, thin-film processing systems, we also are leveraging our technology and know-how for additional markets with our groundbreaking TRIO™ platform, which enables high-value coatings to be deployed cost-effectively on an array of glass displays and other substrates, including for consumer devices.

For more information call 408-986-9888, or visit the Company's website at www.intevac.com.

200 Lean® and TRIO™ are trademarks of Intevac, Inc.

Safe Harbor Statement

This press release includes statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). Intevac claims the protection of the safe-harbor for forward-looking statements contained in the Reform Act. These forward-looking statements are often characterized by the terms “may,” “believes,” “projects,” “expects,” or “anticipates,” and do not reflect historical facts. Specific forward-looking statements contained in this press release include, but are not limited to: the Company’s revenue growth potential and future financial performance. The forward-looking statements contained herein involve risks and uncertainties that could cause actual results to differ materially from the Company’s expectations. These risks include, but are not limited to, global macroeconomic conditions and supply chain challenges including shipment delays, availability of components, and freight, logistics and other disruptions, and changes in market dynamics that could change the forecasts and delivery schedules for both our systems and upgrades, each of which could have a material impact on our business, our financial results, and the Company’s stock price. These risks and other factors are detailed in the Company’s periodic filings with the U.S. Securities and Exchange Commission.

All forward-looking statements in this press release are based on information available to the Company as of the date hereof, and Intevac does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law. Any future product, service, feature, or related specification that may be referenced in this release is for informational purposes only and is not a commitment to deliver any offering, technology or enhancement.

INTEVAC, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except per share amounts)

 

 

Three months ended

 

 

March 30, 2024

 

April 1, 2023

 

 

 

 

 

 

 

 

 

 

Net revenues

 

$

9,631

 

 

$

11,542

 

 

 

 

 

 

Gross profit

 

 

4,204

 

 

 

4,719

 

 

 

 

 

 

Gross margin

 

 

43.7

%

 

 

40.9

%

 

 

 

 

 

Operating expenses

 

 

 

 

Research and development

 

 

4,369

 

 

 

3,973

 

Selling, general and administrative

 

 

4,281

 

 

 

5,200

 

Total operating expenses

 

 

8,650

 

 

 

9,173

 

Total operating loss

 

 

(4,446

)

 

 

(4,454

)

 

 

 

 

 

Interest and other income

 

 

2,221

 

 

 

672

 

Loss before provision for income taxes

 

 

(2,225

)

 

 

(3,782

)

Provision for income taxes

 

 

476

 

 

 

386

 

Net loss from continuing operations

 

 

(2,701

)

 

 

(4,168

)

Net income from discontinued operations

 

 

1,095

 

 

 

277

 

Net loss

 

$

(1,606

)

 

$

(3,891

)

 

 

 

 

 

Net loss per share

 

 

 

 

Basic and diluted – continuing operations

 

$

(0.10

)

 

$

(0.16

)

Basic and diluted – discontinued operations

 

$

0.04

 

 

$

0.01

 

Basic and diluted – net loss

 

$

(0.06

)

 

$

(0.15

)

 

 

 

 

 

Weighted average common shares outstanding

 

 

 

 

Basic and Diluted

 

 

26,522

 

 

 

25,781

 

INTEVAC, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

   

 

March 30, 2024

 

December 30, 2023

 

(Unaudited)

 

(see Note)

ASSETS

 

 

 

 

 

 

 

Current assets

 

 

 

Cash, cash equivalents and short-term investments

$

63,844

 

 

$

68,846

 

Accounts receivable, net

 

25,136

 

 

 

18,613

 

Inventories

 

45,808

 

 

 

43,795

 

Prepaid expenses and other current assets

 

2,387

 

 

 

2,123

 

Total current assets

 

137,175

 

 

 

133,377

 

 

 

 

 

Long-term investments

 

922

 

 

 

2,687

 

Restricted cash

 

700

 

 

 

700

 

Property, plant and equipment, net

 

7,149

 

 

 

7,664

 

Operating lease right-of-use assets

 

7,182

 

 

 

7,658

 

Intangible assets, net

 

920

 

 

 

954

 

Other long-term assets

 

3,194

 

 

 

3,466

 

Total assets

$

157,242

 

 

$

156,506

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

Current liabilities

 

 

 

Current operating lease liabilities

$

902

 

 

$

1,008

 

Accounts payable

 

5,494

 

 

 

5,800

 

Accrued payroll and related liabilities

 

2,837

 

 

 

3,475

 

Other accrued liabilities

 

1,955

 

 

 

1,820

 

Customer advances

 

23,044

 

 

 

20,407

 

Total current liabilities

 

34,232

 

 

 

32,510

 

 

 

 

 

Non-current liabilities

 

 

 

Non-current operating lease liabilities

 

6,591

 

 

 

6,976

 

Customer advances

 

1,482

 

 

 

1,482

 

Other non-current liabilities

 

14

 

 

 

21

 

Total non-current liabilities

 

8,087

 

 

 

8,479

 

 

 

 

 

Stockholders’ equity

 

 

 

Common stock ($0.001 par value)

 

27

 

 

 

26

 

Additional paid-in capital

 

211,398

 

 

 

210,320

 

Treasury stock, at cost

 

(29,551

)

 

 

(29,551

)

Accumulated other comprehensive income

 

30

 

 

 

97

 

Accumulated deficit

 

(66,981

)

 

 

(65,375

)

Total stockholders’ equity

 

114,923

 

 

 

115,517

 

Total liabilities and stockholders’ equity

$

157,242

 

 

$

156,506

 

Note: Amounts as of December 30, 2023 are derived from the December 30, 2023 audited consolidated financial statements

INTEVAC, INC.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(Unaudited, in thousands, except per share amounts)

 

Three months ended

 

March 30, 2024

 

April 1, 2023

 

 

 

 

Non-GAAP Loss from Operations

 

 

 

Reported operating loss (GAAP basis)

$

(4,446

)

 

$

(4,454

)

Non-GAAP Operating Loss

$

(4,446

)

 

$

(4,454

)

 

 

 

 

Non-GAAP Net Loss

 

 

 

Reported net loss (GAAP basis)

$

(1,606

)

 

$

(3,891

)

Discontinued operations1

 

(1,095

)

 

 

(277

)

Non-GAAP Net Loss

$

(2,701

)

 

$

(4,168

)

 

 

 

 

Non-GAAP Net Loss Per Share

 

 

 

Reported net loss per share (GAAP basis)

$

(0.06

)

 

$

(0.15

)

Discontinued operations1:

 

(0.04

)

 

 

(0.01

)

Non-GAAP Net Loss Per Share

$

(0.10

)

 

$

(0.16

)

 

 

 

 

Weighted average number of diluted shares outstanding

 

26,522

 

 

 

25,781

 

1

 

The amount represents discontinued operations of the Photonics business that was sold on December 30, 2021.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240425982444/en/

Kevin Soulsby Chief Financial Officer (408) 986-9888

Claire McAdams Investor Relations (530) 265-9899