Xos, Inc. (NASDAQ: XOS) (“Xos” or the “Company”), a leading
technology company which provides fleet service and software
solutions and manufactures 100% battery-electric Class 5 to Class 8
commercial vehicles, today reported financial results for the
quarter ended September 30, 2022.
Recent Strategic
Highlights:
- Revenue for the third quarter of
2022 was $11.0 million, up 12% compared to the previous
quarter.
- Deliveries of 88 units in the third
quarter of 2022, up 21% compared to 73 units in the previous
quarter, to key customers such as Merchants Fleet and FedEx Ground
operators.
- Net loss was $23.3 million and loss
from operations was $31.2 million for the third quarter of 2022;
non-GAAP operating loss for the quarter was $26.6 million.
- Expanded the offering of Xos Energy
Solutions with the introduction of a suite of Xos DC Fast Chargers,
and secured purchase orders from Morgan Linen, Inc. and additional
fleet customers. This follows the announcement of the proprietary
XosHub, the Company’s mobile charging infrastructure solution.
- Entered a strategic partnership to
expand the Company’s leasing and distribution network with
NationaLease.
- Named W.W. Williams as a pilot
service provider to support Xos customers with world-class
maintenance, service, and repair.
- Unveiled a suite of Advanced Driver
Assistance System (ADAS) features that will be implemented as a
standard feature in Xos stepvans.
- Decreased total cost of ownership
(TCO) with extended warranty offering in partnership with National
Truck Protection Co. Inc.
Dakota Semler, Chief Executive Officer of Xos,
commented, “We are pleased to see continued strong demand for Xos
vehicles. Xos achieved vehicle deliveries to key customers such as
Merchants Fleet and FedEx Ground operators in 15 cities despite
charging infrastructure bottlenecks, global supply chain obstacles,
and macroeconomic headwinds. As our installed base grows and our
vehicles season within customers’ operations, we are also seeing
strong follow on order activity. Operationally, Xos has made
several strategic decisions that will position us for strong growth
and gross margin profitability at a unit level by the end of the
first half of 2023.”
“We are making considerable progress in
overcoming supply chain challenges and improving procurement and
logistics costs. In addition, we are focussed on reducing direct
material costs and overhead as we scale manufacturing at our
principal manufacturing site in Tennessee,” said Giordano Sordoni,
Chief Operating Officer of Xos. “As we realize the benefits of
these advances, it will position us to see strong production volume
increases.”
Third Quarter 2022 Financial Highlights
Compared to Second Quarter 2022:
- Total revenue
increased by approximately 12% to $11.0 million, driven by higher
deliveries during the period, compared to $9.8 million in the prior
quarter.
- Gross Margin loss was $10.8
million, versus $5.1 million in the prior quarter.
- Non-GAAP Gross (Loss) Margin loss
was $5.5 million, compared to $4.2 million in the prior
quarter
- Net Loss was $23.3 million and loss
from operations was $31.2 million, compared to Net Loss of $9.5
million and loss from operations of $27.8 million in the prior
quarter.
- Non-GAAP operating loss was $26.6
million, compared to $25.8 million in the prior quarter.
- Inventories increased to $66.3
million, compared to $62.2 million during the prior quarter as the
Company prepared to increase deliveries.
- Cash, cash equivalents, restricted
cash, and marketable debt securities, available-for-sale were
$109.2 million as of September 30, 2022.
Second Half 2022 Outlook:
Based on current business conditions, business
trends and other factors, the Company is reaffirming its previously
provided outlook for the second half of 2022 as follows:
Second Half 2022 |
Revenue |
$18.75 to $25.60 million |
Unit Deliveries |
150 to 200 units |
Non-GAAP Operating Loss |
$43 to $52 million |
Kingsley Afemikhe, Chief Financial Officer of
Xos, added, “Unit deliveries and revenue were in line with our
expectations, as we saw meaningful increases during the quarter on
a sequential basis underpinned by continued strong demand for our
products and energy solutions. We are reaffirming our second half
2022 outlook and remain on track for deliveries to fall within our
previously provided range. Our gross margin was impacted by a
number of non-cash adjustments in the quarter that we believe are
transitory as we scale and bolster our systems.”
Our balance sheet remains strong, with proceeds
from the recently issued convertible securities, which provided us
with the capital that we need as we scale production in 2023. We
expect our cash used from operations to fall further in the fourth
quarter as we become more operationally efficient, and utilize
working capital more efficiently.”
The outlook provided above is based on
management beliefs and expectations as of the date of this press
release. This outlook assumes that no business acquisitions,
investments, restructurings, or legal settlements are concluded in
the quarter. The results are based on assumptions that are believed
to be reasonable as of this date, but may be materially affected by
many factors, as discussed below in “Forward-Looking Statements”.
Actual results may vary from the outlook above and the variations
may be material. The Company undertakes no intent or obligation to
publicly update or revise any of these projections, whether as a
result of new information, future events or otherwise, except as
required by law.
Conference Call and Webcast
Details:
Management will host a conference call and
webcast to discuss these financial results at 4:30 p.m. Eastern
Standard Time / 1:30 p.m. Pacific Standard Time today. The
presentation is open to all interested parties and may include
forward-looking information.
Date/Time: |
Thursday, November 10, 2022, at 4:30 p.m. EST / 1:30 p.m. PST |
|
|
Webcast: |
https://viavid.webcasts.com/starthere.jsp?ei=1573425&tp_key=c63ccbd2e2 |
|
|
U.S. Toll-Free Dial In: |
1-844-826-3033 |
|
|
International Dial In: |
1-412-317-5185 |
|
|
Conference ID: |
10171513 |
To access the call, please dial in approximately
ten minutes before the start of the call. An accompanying slide
presentation will be available in PDF format within the “Events
& Presentations” section of the Company’s website.
For those unable to participate in the live
call, an audio replay will be available following the call through
midnight Thursday, November 24, 2022. To access the replay, please
call 844-512-2921 or 412-317-6671 (International) and enter
confirmation code 10171513. A replay of the webcast will also
be archived shortly after the call and can be accessed on the
Company's website.
About Xos, Inc.
Xos is a leading technology company, fleet
services provider, and original equipment manufacturer of Class 5
through Class 8 battery-electric vehicles. Xos vehicles and fleet
management software are purpose-built for medium- and heavy-duty
commercial vehicles that travel on last-mile, back-to-base routes
of up to 270 miles or less per day. The company leverages its
proprietary technologies to provide commercial fleets with
zero-emission vehicles that are easier to maintain and more
cost-efficient on a total cost of ownership (TCO) basis than their
internal combustion engine counterparts. For more information,
please visit www.xostrucks.com.
Non-GAAP Financial Measures
The financial information in this press release
has been presented in accordance with United States generally
accepted accounting principles (“GAAP”) as well as on a non-GAAP
basis to supplement Xos’ consolidated financial results. Xos’
non-GAAP financial measures include Operating Cash Flow less CapEx
(Free Cash Flow), Non-GAAP Operating Loss and Non-GAAP Gross (Loss)
Margin, which are defined below.
“Operating Cash Flow less CapEx (Free Cash
Flow)” is defined as net cash used in operating activities minus
purchase of property and equipment.
“Non-GAAP Operating Loss” is defined as
operating loss adjusted for stock-based compensation and inventory
write-downs.
“Non-GAAP Gross (Loss) Margin” is defined as
gross (loss) margin minus inventory write-downs and physical
inventory and other adjustments.
Xos believes that the use of Operating Cash Flow
less CapEx (Free Cash Flow), Non-GAAP Operating Loss and Non-GAAP
Gross (Loss) Margin reflects additional means of evaluating Xos’
ongoing operating results and trends. The presentation of these
measures should not be construed as an inference that Xos’ future
results will be unaffected by unusual or non-recurring items. It is
important to note Xos’ computation of Operating Cash Flow less
CapEx (Free Cash Flow), Non-GAAP Operating Loss and Non-GAAP Gross
(Loss) Margin may not be comparable to other similarly titled
measures computed by other companies, because not all companies may
calculate Operating Cash Flow less CapEx (Free Cash Flow), Non-GAAP
Operating Loss and Non-GAAP Gross (Loss) Margin in the same
fashion. Non-GAAP information is not prepared under a comprehensive
set of accounting rules and therefore, should only be read in
conjunction with financial information reported under GAAP when
understanding Xos’ operating performance. A reconciliation between
historical GAAP and non-GAAP financial information is provided in
this press release.
This release includes forward-looking outlook
for Non-GAAP Operating Loss. The Company is not able to provide,
without unreasonable effort, a reconciliation of the outlook for
Non-GAAP Operating Loss because the Company does not currently have
sufficient data to accurately estimate the variables and individual
adjustments included in the most directly comparable GAAP measure
that would be necessary for such reconciliations, including (a)
stock-based compensation, (b) total operating expenses and (c)
other nonrecurring expenses that cannot reasonably be estimated in
advance. These adjustments are inherently variable and uncertain
and depend on various factors that are beyond Xos’ control and as a
result Xos is also unable to predict their probable significance.
Therefore, because management cannot estimate on a forward-looking
basis without unreasonable effort the impact these variables and
individual adjustments will have on its reported results in
accordance with GAAP, it is unable to provide a reconciliation of
the non-GAAP measures included in its outlook for the second half
of 2022.
Cautionary Statement Regarding Forward-Looking
Statements
This press release includes “forward-looking
statements” within the meaning of the “safe harbor” provisions of
the United States Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, but are not limited to,
statements regarding projected financial and performance
information for the second half of 2022 and into the first half of
2023 and sequential quarterly growth during 2022; expectations and
timing related to manufacturing quality, production yields, product
deployments and launches; sufficiency of existing cash reserves;
customer acquisition and order metrics; and Xos’ long-term strategy
and future growth. These forward-looking statements may be
identified by the words “believe,” “plan,” “project,” “potential,”
“seem,” “seek,” “expect,” “anticipate,” “estimate,” “intend,”
“strategy,” “future,” “target,” “opportunity,” “plan,” “may,”
“could,” “should,” “will,” “would,” “will be,” “will continue,”
“will likely result,” and similar expressions and any other
statements that predict or indicate future events or trends or that
are not statements of historical matters, although not all
forward-looking statements contain such identifying words.
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. Many factors could cause actual future events to
differ materially from the forward-looking statements in this press
release, including but not limited to: (i) Xos’ ability to
implement business plans, forecasts, and other expectations, and
identify and realize additional opportunities, (ii) Xos’ limited
operating history, (iii) cost increases and delays in production
due to supply chain shortages in the components needed for the
production of Xos’ vehicle chassis and battery system, (iv) Xos’
ability to meet production milestones and fulfill backlog orders,
(v) changes in the industries in which Xos operates, (vi)
variations in operating performance across competitors, (vii)
changes in laws and regulations affecting Xos’ business, (viii)
Xos’ ability to implement its business plan or meet or exceed its
financial projections, (ix) Xos’ ability to retain key personnel
and hire additional personnel, particularly in light of current and
potential labor shortages, (x) the risk of downturns and a changing
regulatory landscape in the highly competitive electric vehicle
industry, (xi) Xos’ ability to service its indebtedness, and (xii)
the outcome of any legal proceedings that may be instituted against
Xos. All forward-looking statements included in this press release
are expressly qualified in their entirety by, and you should
carefully consider, the foregoing factors and the other risks and
uncertainties described under the heading “Risk Factors” included
in Xos’ Annual Report on Form 10-K for the year ended December 31,
2021 filed with the SEC on March 30, 2022 and Xos’ other filings
with the SEC, copies of which may be obtained by visiting Xos’
Investors Relations website at https://investors.xostrucks.com/ or
the SEC's website at www.sec.gov. 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 Xos assumes no
obligation and does not intend to update or revise these
forward-looking statements, whether as a result of new information,
future events, or otherwise. Xos does not give any assurance that
it will achieve its expectations.
Contacts
Xos Investor Relations
investors@xostrucks.com
Xos Media Relations
press@xostrucks.com
Xos, Inc. and
SubsidiariesCondensed Consolidated Balance
Sheets(Unaudited)
(in
thousands, except par value) |
|
September 30, 2022 |
|
December 31, 2021 |
Assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
46,433 |
|
|
$ |
16,142 |
|
Restricted cash |
|
|
3,037 |
|
|
|
3,034 |
|
Accounts receivable, net |
|
4,150 |
|
|
3,353 |
|
Marketable debt securities,
available-for-sale - short-term |
|
59,700 |
|
|
94,696 |
|
Inventories, net |
|
66,306 |
|
|
30,883 |
|
Prepaid expenses and other
current assets |
|
20,054 |
|
|
17,850 |
|
Total current
assets |
|
199,680 |
|
|
165,958 |
|
Marketable debt securities,
available-for-sale - long-term |
|
- |
|
|
54,816 |
|
Property and equipment,
net |
|
18,023 |
|
|
|
7,426 |
|
Operating lease right-of-use
assets, net |
|
|
6,933 |
|
|
- |
|
Other non-current assets |
|
1,600 |
|
|
506 |
|
Total
assets |
|
$ |
226,236 |
|
|
$ |
228,706 |
|
|
|
|
|
|
Liabilities
and stockholders’
equity |
|
|
|
|
Accounts payable |
|
$ |
5,239 |
|
|
$ |
10,122 |
|
Other current liabilities |
|
20,760 |
|
|
5,861 |
|
Total current
liabilities |
|
25,999 |
|
|
15,983 |
|
Convertible debt, net |
|
53,722 |
|
|
- |
|
Earn-out share liability |
|
5,150 |
|
|
29,240 |
|
Common stock warrant
liability |
|
|
2,337 |
|
|
|
7,496 |
|
Other non-current
liabilities |
|
|
11,214 |
|
|
|
1,594 |
|
Total
liabilities |
|
98,422 |
|
|
54,313 |
|
Commitment
and contingencies |
|
|
|
|
Stockholders’
equity |
|
|
|
|
Common Stock $0.0001 par
value, authorized 1,000,000 shares, 166,432 and 163,137 shares
issued and outstanding at September 30, 2022 and December 31,
2021, respectively |
|
17 |
|
|
16 |
|
Preferred Stock $0.0001 par
value, authorized 10,000 shares, 0 shares issued and
outstanding at September 30, 2022 and December 31, 2021,
respectively |
|
- |
|
|
- |
|
Additional paid in
capital |
|
187,014 |
|
|
178,551 |
|
Accumulated deficit |
|
(58,001 |
) |
|
(4,093 |
) |
Accumulated other
comprehensive loss |
|
(1,216 |
) |
|
(381 |
) |
Total stockholders’
equity |
|
127,814 |
|
|
174,393 |
|
Total liabilities and
stockholders’ equity |
|
$ |
226,236 |
|
|
$ |
228,706 |
|
Xos, Inc. and
SubsidiariesCondensed Consolidated Statements of
Operations(Unaudited)
(in thousands, except per share amounts) |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Revenues |
|
$ |
11,008 |
|
|
$ |
357 |
|
|
$ |
27,805 |
|
|
$ |
1,746 |
|
Cost of Goods Sold |
|
|
21,777 |
|
|
|
418 |
|
|
|
46,854 |
|
|
|
1,675 |
|
Gross (Loss) Margin |
|
|
(10,769 |
) |
|
|
(61 |
) |
|
|
(19,049 |
) |
|
|
71 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative |
|
|
9,470 |
|
|
|
7,606 |
|
|
|
30,991 |
|
|
|
15,756 |
|
Research and development |
|
|
8,573 |
|
|
|
5,302 |
|
|
|
24,493 |
|
|
|
9,846 |
|
Sales and marketing |
|
|
2,345 |
|
|
|
1,337 |
|
|
|
7,891 |
|
|
|
2,173 |
|
Total Operating
Expenses |
|
|
20,388 |
|
|
|
14,245 |
|
|
|
63,375 |
|
|
|
27,775 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
Operations |
|
|
(31,157 |
) |
|
|
(14,306 |
) |
|
|
(82,424 |
) |
|
|
(27,704 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense, net |
|
|
(642 |
) |
|
|
(66 |
) |
|
|
(787 |
) |
|
|
(83 |
) |
Change in fair value of
derivative instruments |
|
|
1,890 |
|
|
|
1,066 |
|
|
|
5,158 |
|
|
|
6,030 |
|
Change in fair value of
earn-out shares liability |
|
|
6,654 |
|
|
|
48,202 |
|
|
|
24,148 |
|
|
|
48,202 |
|
Write off of subscription
receivable |
|
|
- |
|
|
- |
|
|
- |
|
|
(379 |
) |
Realized loss on debt
extinguishment |
|
|
- |
|
|
- |
|
|
- |
|
|
(14,104 |
) |
(Loss) income before provision
for income taxes |
|
|
(23,255 |
) |
|
|
34,896 |
|
|
|
(53,905 |
) |
|
|
11,962 |
|
Provision for income
taxes |
|
|
- |
|
|
- |
|
|
3 |
|
|
|
- |
Net (loss)
income |
|
$ |
(23,255 |
) |
|
$ |
34,896 |
|
|
$ |
(53,908 |
) |
|
$ |
11,962 |
|
Other comprehensive
(loss) income |
|
|
|
|
|
|
|
|
|
|
|
|
Marketable debt securities,
available-for-sale |
|
|
|
|
|
|
|
|
|
|
|
|
Change in net unrealized gain (loss), net of tax of $0, for the
three and nine months ended September 30, 2022 and 2021 |
|
|
141 |
|
|
|
- |
|
|
(835 |
) |
|
|
- |
Total comprehensive
(loss) income |
|
$ |
(23,114 |
) |
|
$ |
34,896 |
|
|
$ |
(54,743 |
) |
|
$ |
11,962 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per
share |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.14 |
) |
|
$ |
0.31 |
|
|
$ |
(0.33 |
) |
|
$ |
0.14 |
|
Diluted |
|
$ |
(0.14 |
) |
|
$ |
0.30 |
|
|
$ |
(0.33 |
) |
|
$ |
0.14 |
|
Weighted average
shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
165,901 |
|
|
|
113,797 |
|
|
|
164,379 |
|
|
|
86,192 |
|
Diluted |
|
|
165,901 |
|
|
|
115,932 |
|
|
|
164,379 |
|
|
|
88,487 |
|
Reconciliation of Operating Cash Flow less CapEx (Free
Cash Flow), Non-GAAP Operating Loss and Non-GAAP
Gross (Loss) Margin
Operating Cash Flow less CapEx (Free Cash Flow):
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
(in thousands) |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net cash used in operating
activities |
|
$ |
(29,769 |
) |
|
$ |
(32,982 |
) |
|
$ |
(105,597 |
) |
|
$ |
(53,135 |
) |
Purchases of property and
equipment |
|
|
(2,436 |
) |
|
|
(2,641 |
) |
|
|
(11,898 |
) |
|
|
(3,343 |
) |
Free-Cash
Flow |
|
$ |
(32,205 |
) |
|
$ |
(35,623 |
) |
|
$ |
(117,495 |
) |
|
$ |
(56,478 |
) |
Non-GAAP Operating Loss:
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
(in thousands) |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Loss from operations |
|
$ |
(31,157 |
) |
|
$ |
(14,306 |
) |
|
$ |
(82,424 |
) |
|
$ |
(27,704 |
) |
Stock-based compensation |
|
|
1,281 |
|
|
|
1 |
|
|
|
3,751 |
|
|
|
5 |
|
Inventory write-downs |
|
|
3,326 |
|
|
|
- |
|
|
|
5,538 |
|
|
|
- |
|
Non-GAAP Operating
Loss |
|
$ |
(26,550 |
) |
|
$ |
(14,305 |
) |
|
$ |
(73,135 |
) |
|
$ |
(27,699 |
) |
Non-GAAP Gross (Loss) Margin:
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
Three Months Ended June 30, |
(in
thousands) |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|
2022 |
Gross (loss) margin |
|
$ |
(10,769 |
) |
|
$ |
(61 |
) |
|
$ |
(19,049 |
) |
|
$ |
71 |
|
|
$ |
(5,125 |
) |
Physical inventory and other
adjustments |
|
|
1,933 |
|
|
|
- |
|
|
|
1,556 |
|
|
|
- |
|
|
|
- |
|
Inventory write-downs |
|
|
3,326 |
|
|
|
- |
|
|
|
5,538 |
|
|
|
- |
|
|
|
964 |
|
Non-GAAP Gross (Loss)
Margin |
|
$ |
(5,510 |
) |
|
$ |
(61 |
) |
|
$ |
(11,955 |
) |
|
$ |
71 |
|
|
$ |
(4,161 |
) |
Gross (loss) margin % |
|
|
(98 |
%) |
|
|
(17 |
%) |
|
|
(69 |
%) |
|
|
4 |
% |
|
|
(52 |
%) |
Non-GAAP gross (loss) margin
% |
|
|
(50 |
%) |
|
|
(17 |
%) |
|
|
(43 |
%) |
|
|
4 |
% |
|
|
(43 |
%) |
Xos (NASDAQ:XOS)
Historical Stock Chart
From Mar 2024 to Apr 2024
Xos (NASDAQ:XOS)
Historical Stock Chart
From Apr 2023 to Apr 2024