Latch resets cost structure
May 20 2022 - 4:00PM
Latch, Inc. (NASDAQ: LTCH), maker of LatchOS, the full-building
enterprise software-as-a-service (SaaS) platform, today announced
the completion of a workforce reduction. Additionally, the Company
is announcing the reorganization of the sales and marketing
departments under the leadership of Lee Odess. Prior to this role,
Odess was the GM of New Market Development at Latch. Odess is a
proven leader in the industry with nearly 20 years of experience
driving sales growth, product innovation, and geographic expansion
for leading companies in the smart access and security space.
Latch believes that, along with the recently announced
reorganization of its product organization and revised sales
compensation structure focused on recurring software revenue, these
changes will position the Company for long-term growth while also
accelerating its path towards self-sustaining free cash flow and
profitability. Latch expects this reduction in force will better
align staffing and expense levels with current sales volumes and
the current macroeconomic environment, with continued construction
delays and supply chain shortages. The reduction impacts
approximately 130 people, or approximately 28% of Latch’s full-time
employees. Once fully implemented, Latch expects to achieve
approximately $40 million annual run rate cost savings across
research and development, sales and marketing and general and
administrative expenses. The reduction is expected to result in
approximately $4 million to $6 million of total cash restructuring
and related charges primarily related to severance and benefits
costs (excluding the impact of share-based compensation),
substantially all of which is expected to be incurred in the second
quarter of 2022.
Latch’s guidance provided in its first quarter earnings release
does not reflect the recently completed workforce reduction. Latch
intends to provide further information about this reorganization
and updated guidance in connection with the release of Latch’s
second quarter earnings.
As of March 31, 2022, Latch had cash plus marketable securities
of $335 million, and continues to believe it is fully capitalized
to fund its growth plan to free cash flow breakeven.
About Latch, Inc.
Latch makes spaces better
places to live, work, and visit through a system of software,
devices, and services. For more information, please visit
https://www.latch.com.
FORWARD-LOOKING STATEMENTS
This release contains
certain forward-looking statements within the meaning of the
federal securities laws, including statements regarding adoption of
Latch’s technology and products. These forward-looking statements
generally are identified by the words "believe," "project,"
"expect," "anticipate," "estimate," "intend," "strategy," "future,"
"opportunity," "plan," "may," "should," "would," "will continue,"
"will likely result," and similar expressions. Forward-looking
statements are predictions, projections, and other statements about
future events that are based on current expectations and
assumptions and, as a result, are subject to risks and
uncertainties. Forward-looking information includes, but is not
limited to, statements regarding: the Company’s future products,
performance, and operations, and the related benefits to
shareholders, customers, and residents; the impact of the workforce
reduction on the Company’s business; and the Company’s strategy.
Many factors could cause actual future events to differ materially
from the forward-looking statements in this document, including
Latch’s ability to implement business plans and changes and
developments in the industry in which Latch competes. The foregoing
list of factors is not exhaustive. You should carefully consider
the foregoing factors and the other risks and uncertainties
described in the "Risk Factors" section of our Annual Report on
Form 10-K filed with the SEC on March 1, 2022, and other documents
filed by Latch from time to time with the SEC. These filings
identify and address other important risks and uncertainties that
could cause actual events and results to differ materially from
those contained in the forward-looking statements. Forward-looking
statements speak only as of the date they are made. Readers are
cautioned not to put undue reliance on forward-looking statements,
and the Company assumes no obligation to update or revise these
forward-looking statements, whether as a result of new information,
future events, or otherwise, except as required by law, including
the securities laws of the United States and the rules and
regulations of the SEC. The Company does not give any assurance
that it will achieve its expectations.
CONTACTS:
Investors:
investors@latch.com
Media:
press@latch.com
Latch (NASDAQ:LTCH)
Historical Stock Chart
From Jun 2024 to Jul 2024
Latch (NASDAQ:LTCH)
Historical Stock Chart
From Jul 2023 to Jul 2024