NEWARK, Calif., Nov. 17, 2020 /PRNewswire/ -- Socket Mobile, Inc. (NASDAQ: SCKT), a leading innovator of data capture and delivery solutions for enhanced productivity, announced today that it has completed the annual goodwill impairment test required by generally accepted accounting principles. As a result of the lower stock price from the beginning of 2020 through the annual goodwill measurement date of September 30th, the Company concluded that an adjustment to its fair value was required.

(PRNewsfoto/Socket Mobile, Inc.)

The non-cash impairment charge totaled $4.4 million and was recorded in the Company's Q3 2020 results. The impairment charge does not affect the Company's cash position, cash flow from operating activities, bank debt covenants, and does not have any impact on future operations.

The revised financial tables reflecting the goodwill impairment can be found at the end of this press release. For detailed information, please refer to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 at https://www.sec.gov/Archives/edgar/data/944075/000094407520000048/q3-2020.htm

About Socket Mobile, Inc.
Socket Mobile is a leading provider of data capture and delivery solutions for enhanced productivity in workforce mobilization. Socket Mobile's revenue is primarily driven by the deployment of third-party barcode enabled mobile applications that integrate Socket Mobile's cordless barcode scanners and contactless reader/writers. Mobile Applications servicing the specialty retailer, field service, transportation, and manufacturing markets are the primary revenue drivers. Socket Mobile has a network of thousands of developers who use its software developer tools to add sophisticated data capture to their mobile applications. Socket Mobile is headquartered in Newark, Calif. and can be reached at +1-510-933-3000 or www.socketmobile.com. Follow Socket Mobile on Facebook, Twitter @socketmobile and on our sockettalk blog.

Socket Mobile Investor Contact:
Lynn Zhao
Chief Financial Officer
510-933-3016
lynn@socketmobile.com

Socket is a registered trademark of Socket Mobile. All other trademarks and trade names contained herein may be those of their respective owners.
© 2020, Socket Mobile, Inc. All rights reserved.

-- Revised financial tables to follow --

Socket Mobile, Inc.

Summary Statements of Operations (Unaudited)

(Amounts in Thousands except per share amounts and percentages)



Three months ended Sept 30,

Nine months ended Sept 30,


2020

2019

2020

2019

Revenue

$  4,109

$  4,980

$  11,044

 

$  14,668

 

Cost of revenue

1,835

2,344

5,186

7,003

Gross margin

2,274

2,636

5,858

7,665

   Gross margin percent

55.3%

52.9%

53.0%

52.3%

Research & development

 

681

1,015

2,421

2,906

Sales & marketing

658

785

2,148

2,312

General & administrative

486

707

1,741

2,053

Goodwill impairment charges

4,427

--

4,427

--

   Total operating expenses

6,252

2,507

10,737

7,271

Operating income (loss)

(3,978)

129

(4,879)

394

Other income

--

--

70

--

Interest income (expense), net

(24)

(25)

(51)

(83)

Income tax (expense) benefit

(1)

(10)

(1)

(85)

Net income (loss)

   $ (4,003)*

$      94

  $  (4,861)*

$      226

Earnings (loss) per share: 

  Basic

  Diluted

 

$ (0.62)*

$ (0.62)*

 

     $ 0.02

      $ 0.01

   

 $ (0.76)*

  $ (0.76)*

   

$ 0.04

 $ 0.04

Weighted average shares outstanding:

  Basic

  Diluted

 

6,038

6,038

 

      5,999

      6,317

   

  6,020

  6,020

    

 5,980

 6,237

*Included goodwill impairment adjustment of $4.43 million recorded as of September 30, 2020

 

Socket Mobile, Inc.

Condensed Summary Balance Sheets

(Amounts in Thousands)



 September 30,
2020

December 31,
2019**

Cash

$     1,775

$         959

Accounts receivable, net

2,359

2,837

Inventories, net

3,362

3,179

Deferred cost on shipments to distributors

179

234

Other current assets

317

312

Property and equipment, net

835

864

Goodwill

--

4,427

Deferred tax assets

5,507

5,507

Operating leases right-of-use assets

 

704

937

Other long-term assets

170

202

Total assets

  $   15,208*

$    19,458

Accounts payable and accrued liabilities

$     2,417

$      2,651

Bank line of credit

--

1,413

Notes payable

1,059

333

Subordinated convertible notes payable, net of discount

168

--

Subordinated convertible notes payable, net of discount-related party

1,265

--

Deferred revenue on shipments to distributors

557

611

Deferred service revenue

55

 

74

Operating lease liabilities

 

855

1,134

 

Other liabilities

--

8

Total liabilities

6,376

6,224

Common stock

 

61,532

 

61,073

 

 

 

Accumulated deficit

    (52,700)*

(47,839)

Total equity

       8,832*

13,234

Total liabilities and equity

 $   15,208*

$   19,458

*Included goodwill impairment adjustment of $4.43 million recorded as of September 30, 2020

**Derived from audited financial statements.

                                           

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SOURCE Socket Mobile, Inc.

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