Company on track to execute on bookings in
excess of $1 billion over 18 months
Strong bookings and expansion of Athena®
platform drive momentum into 2022
Initiate full-year 2022 revenue guidance of
$350-$425 million
Fourth Quarter and Full-Year 2021 Financial
and Operating Highlights
Financial Highlights – Fourth Quarter 2021
- Record revenues of $52.8 million, up from $18.6 million (+184%)
in Q4 2020
- GAAP Gross Margin of (3)% versus 5% in Q4 2020
- Non-GAAP Gross Margin of 6% versus 13% in Q4 2020
- Net Loss of $(34.1) million versus Net Loss of $(100.9) million
in Q4 2020
- Adjusted EBITDA of $(12.4) million versus $(5.1) million in Q4
2020
- Ended the fourth quarter with $921 million in cash, cash
equivalents and short-term investments
Financial Highlights – Full Year 2021
- Record revenues of $127.4 million, up from $36.3 million
(+251%) in 2020
- GAAP Gross Margin of 1% versus (11)% in 2020
- Non-GAAP Gross Margin of 11% versus 10% in 2020
- Net Loss of $(101.2) million versus Net Loss of $(156.1)
million in 2020
- Adjusted EBITDA of $(30.3) million versus $(25.4) million in
2020
Operating Highlights – Fourth Quarter 2021
- Record bookings of $216.9 million, up from $43.4 million
(+400%) in Q4 2020
- Record contracted backlog of $449 million, up from $312 million
(+44%) at the end of Q3 2021
- Record contracted assets under management (AUM) of 1.6
gigawatts hours (GWh) at the end of 2021, up from 1.4 GWh (+14%) at
the end of Q3 2021
Operating Highlights – Full Year 2021
- Record 12-month pipeline of $4.0 billion at the end of 2021, up
from $2.4 billion (+67%) at the end of Q3 2021, and up from $1.6
billion (+150%) in 2020
- Record bookings of $416.5 million, up from $137.7 million
(+202%) in 2020
- Record contracted backlog of $449 million, up from $184 million
(+144%) in 2020
- Record contracted AUM of 1.6 GWh at the end of 2021, up from
1.0 GWh (+60%) in 2020
Stem, Inc. ("Stem" or the "Company") (NYSE: STEM), a global
leader in artificial intelligence (AI)-driven energy software and
services, announced today its financial results for the three and
12 months ended December 31, 2021. All reported results included in
this release do not reflect the acquisition of AlsoEnergy, which
closed on February 1, 2022.
John Carrington, Chief Executive Officer of Stem, commented, “We
reported another strong quarter with record revenues, backlog,
pipeline and AUM, all driven by our market-leading Athena platform.
Our contracted backlog grew sequentially by 44% during the quarter,
driven by a record $217 million in bookings. For the full-year
2021, revenues grew 251% to $127 million, and bookings grew 202% to
$417 million, bolstering our contracted backlog, which grew 144%
year-over-year and provides strong momentum into 2022 and
beyond.
“As part of our continued focus on our software platforms,
Athena and AlsoEnergy’s PowerTrack, we plan to add a sixth key
metric to our reporting stack with the addition of contracted
annual recurring revenue or “CARR”. The metric will provide
visibility to the growth in our software and services base as we
continue to build existing markets and enter new ones. We believe
CARR, estimated to be between $60M - $80M for 2022, when combined
with our historically low churn, will provide a long-term view to
our anticipated growth in services revenue.
“As previously announced, we completed the AlsoEnergy
transaction earlier this month. The transaction is
transformational, as it combines two of the leading renewable
energy software platforms to provide best in class services to the
fast-growing renewable energy industry. With our common mission
critical software offerings, we provide high value solutions which
enhances revenues and manage costs for renewable energy projects
across the globe.
“Supply chain, permitting and interconnection delays negatively
impacted our fourth quarter revenues, but demand remains robust,
and we expect these issues to resolve over time. We are pleased to
introduce our 2022 revenue guidance range, inclusive of AlsoEnergy,
which at the midpoint implies we will more than triple our revenues
again this year. In addition, we are on track to execute on
bookings in excess of $1 billion between July 2021 and December
2022. Our differentiated software offering, customer-focused
employees, and strong balance sheet provide visibility into our
anticipated multi-year growth in recurring software revenues.”
Financial Results and Key
Metrics
(in $ millions unless otherwise
noted):
Three Months Ended
Year Ended
December 31,
December 31,
2021
2020
2021
2020
Financial results
Revenue
$52.8
$18.6
$127.4
$36.3
GAAP Gross Margin
(1.6)
0.9
1.2
(3.9)
GAAP Gross Margin (%)
(3)%
5%
1%
(11)%
Non-GAAP Gross Margin*
3.3
2.5
14.0
3.5
Non-GAAP Gross Margin (%)*
6%
13%
11%
10%
Net Loss
(34.1)
(100.9)
(101.2)
(156.1)
Adjusted EBITDA*
(12.4)
(5.1)
(30.3)
(25.4)
Key Operating metrics
12-Month Pipeline ($ billions)**
$4.0
$1.6
$4.0
$1.6
Bookings
216.9
43.4
416.5
137.7
Contracted Backlog**
449.0
184.0
449.0
184.0
Contracted AUM (GWh)**
1.6
1.0
1.6
1.0
*Non-GAAP financial measures. See the
section below titled “Use of Non-GAAP Financial Measures” for
details and the section below titled “Reconciliations of Non-GAAP
Financial Measures” for reconciliations.
** At period end.
Fourth Quarter and Full-Year 2021 Financial and Operating
Results
Financial Results
Fourth quarter 2021 revenue increased 184% to a record $52.8
million, versus $18.6 million in the fourth quarter of 2020.
Full-year 2021 revenue increased 251% to a record $127.4 million
versus $36.3 million in full-year 2020. Higher hardware revenue
from Front of the Meter (“FTM”) and Behind the Meter (“BTM”)
partnership agreements drove most of the increase for the quarter
and the year, in addition to higher services revenue driven by
increased adoption of the Athena platform.
Fourth quarter 2021 GAAP Gross Margin was $(1.6) million, or
(3)%, versus $0.9 million, or 5% in the fourth quarter of 2020, and
$3.1 million, or 8%, in the third quarter of 2021. Full-year 2021
GAAP Gross Margin was $1.2 million, or 1%, versus full-year 2020
GAAP Gross Margin of $(3.9) million, or (11)%. The year-over-year
decrease in GAAP Gross Margin for the fourth quarter resulted
primarily from a higher level of non-cash impairments. The
year-over-year increase in GAAP Gross Margin for the full year
resulted from additional high margin services revenues.
Fourth quarter 2021 Non-GAAP Gross Margin was $3.3 million, or
6% versus $2.5 million, or 13% in the fourth quarter of 2020, and
$5.8 million, or 15%, in the third quarter of 2021. Full-year 2021
Non-GAAP Gross Margin was $14.0 million, or 11%, versus full-year
2020 Non-GAAP Gross Margin of $3.5 million, or 10%.
The year-over-year increase in Non-GAAP Gross Margin for the
fourth quarter and full year resulted from higher revenues. In
percentage terms for the fourth quarter, the year-over-year
decrease in Non-GAAP Gross Margins resulted from a higher mix of
hardware deliveries. In percentage terms for the full year, the
year-over-year increase resulted from higher services revenue.
Fourth quarter 2021 Net Loss was $(34.1) million versus fourth
quarter 2020 Net Loss of $(100.9) million. Full-year 2021 Net Loss
was $(101.2) million versus full-year 2020 Net Loss of $(156.1)
million. For the quarter and the year, the differences were
primarily driven by non-cash revaluation of warrants, tied to
changes in the value of the underlying common stock.
Fourth quarter 2021 Adjusted EBITDA was $(12.4) million compared
to $(5.1) million in the fourth quarter of 2020. Full-year 2021
Adjusted EBITDA was $(30.3) million compared to $(25.4) million in
full-year 2020. The lower Adjusted EBITDA results were primarily
driven by higher operating expenses due to increased personnel
costs reflecting continued investment in our growth initiatives and
costs associated with public reporting requirements.
The Company ended the fourth quarter 2021 with $921 million in
cash, consisting of $748 million in cash and cash equivalents and
$173 million in short-term investments. The sequential increase
from $576 million in cash at the end of third quarter 2021 was
primarily the result of the issuance of $460 million of our 0.50%
Green Convertible Senior Notes due 2028, net of discounts, fees and
the purchase of capped call options.
Operating Results
The Company’s 12-month forward pipeline was $4.0 billion at the
end of the fourth quarter compared to $2.4 billion at the end of
the third quarter, representing 67% sequential growth. The increase
in the 12-month pipeline is a result of increased FTM project
opportunities, including significant expansions into new markets,
continued growth in Stem’s partner channel, and the seasonal nature
of the pipeline.
Contracted Backlog was $449 million as of December 31, 2021
compared to $312 million as of September 30, 2021, representing a
44% sequential increase. The increase in Contracted Backlog
resulted from record bookings in the quarter of $217 million,
partially offset by revenue recognition, contract cancellations and
amendments during the quarter. For the fourth quarter 2021,
bookings grew 400% year-over-year from $43 million in fourth
quarter 2020. Full year 2021 bookings of $416.5 million were more
than three times higher than full-year 2020 bookings of $137.7
million.
Contracted AUM increased 60% year-over-year and 14% sequentially
to 1.6 GWh, driven by new contracts.
The following table provides a summary of backlog at the end of
the fourth quarter, compared to third quarter backlog ($
millions):
Period ended 3Q21
$312
Add: Bookings
217
Less: Hardware revenue
(47)
Cancellations
(24)
Amendments/other
(9)
Period ended 4Q21
$449
The Company expects to continue to diversify its supply chain,
adopt alternative technologies, and deploy its balance sheet to
meet the expected significant growth in customer demand. COVID-19
and general macroeconomic conditions continue to impact the supply
chain and project timelines, and the Company has been affected by
inflation in the costs of equipment. The Company is actively
working to mitigate these impacts on its financial results.
Business Highlights
On February 24, 2022, the Company announced that it had been
exclusively selected to provide storage solutions to Available
Power, a developer of distributed energy resources. The strategic
partnership will develop up to 100 FTM sites in Texas with
potential to provide one gigawatt (GW), or two GWh, of energy
storage systems and Athena software. The portfolio will be
completed in phases, with deployment of the first 20 systems by
early 2023.
On February 1, 2022, the Company completed its
previously-announced acquisition of AlsoEnergy Holdings, Inc.
(“AlsoEnergy”) for $695 million in a combination of cash and Stem
common stock. AlsoEnergy is a global leader in solar asset
management software, with 33 gigawatts (GW) of assets under
management in more than 50 countries. In the fiscal year ended
December 31, 2020, AlsoEnergy generated approximately $49 million
in revenue and realized 60% gross margin across its software, grid
edge monitoring, controls, and services businesses. AlsoEnergy will
continue to operate under its own brand and provide the same
services to its customers.
On January 5, 2022, the Company announced that it had entered
into a co-marketing agreement with ENGIE North America to develop
an offering to enable eMobility solutions. The offering will
combine Stem’s Athena software and storage hardware with ENGIE’s
charging, energy management, and onsite generation solutions.
On November 22, 2021, the Company sold $460 million aggregate
principal amount of its 0.50% Green Convertible Senior Notes due
2028 (the “Notes”) in a private placement. In connection with the
sale of the Notes, Stem entered into capped call transactions to
reduce potential dilution to Stem’s common stock upon any
conversion of the Notes, with a cap price of $49.66 per share.
Stem’s net proceeds from this offering were approximately $445.7
million. Stem used approximately $67 million of the net proceeds to
pay the cost of the capped call transactions.
Outlook
The Company is introducing full-year 2022 financial guidance as
follows ($ millions unless otherwise noted):
Revenue
$350 - $425
Non-GAAP Gross Margin (%)
15%- 20%
Adjusted EBITDA
$(60) - $(20)
Bookings
$650 - $750
CARR (yearend)
$60 - $80
The Company is introducing 2022 seasonality guidance indicating
quarterly projected performance against the annual targets as
follows:
Metric
Q1
Q2
Q3
Q4
Revenue
7.5%
15.0%
22.5%
55.0%
Bookings
20%
20%
25%
35%
Stem’s 2022 guidance includes the operations of AlsoEnergy
effective February 1, 2022.
Use of Non-GAAP Financial Measures
In addition to financial results determined in accordance with
U.S. generally accepted accounting principles (“GAAP”), this
fourth-quarter and full-year 2021 earnings release contains the
following non-GAAP financial measures: non-GAAP gross margin and
Adjusted EBITDA. The foregoing non-GAAP financial measures should
be considered in addition to, not as a substitute for, or superior
to, other measures of financial performance prepared in accordance
with GAAP. For reconciliation of non-GAAP gross margin and Adjusted
EBITDA to their comparable GAAP measures, see the section below
entitled “Reconciliations of non-GAAP Financial Measures.”
We use these non-GAAP financial measures for financial and
operational decision making and to evaluate our operating
performance and prospects, develop internal budgets and financial
goals, and to facilitate period-to-period comparisons. Our
management believes that these non-GAAP financial measures provide
meaningful supplemental information regarding our performance and
liquidity by excluding certain expenses and expenditures that may
not be indicative of our operating performance, such as stock-based
compensation and other non-cash charges, as well as discrete cash
charges that are infrequent in nature. We believe that both
management and investors benefit from referring to these non-GAAP
financial measures in assessing our performance and when planning,
forecasting, and analyzing future periods. These non-GAAP financial
measures also facilitate management’s internal comparisons to our
historical performance and liquidity as well as comparisons to our
competitors’ operating results, to the extent that competitors
define these metrics in the same manner that we do. We believe
these non-GAAP financial measures are useful to investors both
because they (1) allow for greater transparency with respect to key
metrics used by management in its financial and operational
decision making and (2) are used by our institutional investors and
the analyst community to help them analyze the health of our
business.
We define Adjusted EBITDA as net loss before depreciation and
amortization, including amortization of internally developed
software, net interest expense, further adjusted to exclude
stock-based compensation and other income and expense items,
including the change in fair value of warrants and embedded
derivatives, loss on extinguishment of debt, and income taxes.
We define non-GAAP gross margin as gross margin excluding
amortization of capitalized software, impairments related to
decommissioning of end-of-life systems, and adjustments to
reclassify data communication and cloud production expenses to
operating expenses. See the definitions of non-GAAP metrics at the
end of the press release.
About Stem, Inc.
Stem (NYSE: STEM) provides solutions that address the challenges
of today’s dynamic energy market. By combining advanced energy
storage solutions with Athena®, a world-class AI-powered analytics
platform, Stem enables customers and partners to optimize energy
use by automatically switching between battery power, onsite
generation, and grid power. Stem’s solutions help enterprise
customers benefit from a clean, adaptive energy infrastructure and
achieve a wide variety of goals, including expense reduction,
resilience, sustainability, environmental and corporate
responsibility, and innovation. Stem also offers full support for
solar partners interested in adding storage to standalone,
community or commercial solar projects – both behind and in front
of the meter. With the acquisition of AlsoEnergy, Stem is a leader
in the solar asset management space, bringing project developers,
asset owners and commercial customers an integrated solution for
solar and energy storage management and optimization. For more
information, visit www.stem.com.
Notes
Stem will hold a conference call to discuss this earnings press
release and business outlook on Thursday, February 24, 2022
beginning at 5:00 p.m. Eastern Time. The conference call and
accompanying slides may be accessed via a live webcast on a
listen-only basis on the Events & Presentations page of the
Investor Relations section of the Company’s website at
https://investors.stem.com/events-and-presentations. The call can
also be accessed live over the telephone by dialing (855) 327-6837,
or for international callers, (631) 891-4304 and referencing Stem.
A replay of the conference call will be available shortly after the
call and can be accessed by dialing (844) 512-2921 or for
international callers by dialing (412) 317-6671. The passcode for
the replay is 10018011. An archive of the webcast will be available
on the Company’s website at https://investors.stem.com/overview for
12 months after the call.
Forward-Looking Statements
This fourth-quarter and full-year 2021 earnings press release,
as well as other statements we make, contain “forward-looking
statements” within the meaning of the federal securities laws,
which include any statements that are not historical facts. Such
statements often contain words such as “expect,” “may,” “can,”
“believe,” “predict,” “plan,” “potential,” “projected,”
“projections,” “forecast,” “estimate,” “intend,” “anticipate,”
“ambition,” “goal,” “target,” “think,” “should,” “could,” “would,”
“will,” “hope,” “see,” “likely,” and other similar words.
Forward-looking statements address matters that are, to varying
degrees, uncertain, such as statements about our financial and
performance targets and other forecasts or expectations regarding,
or dependent on, our business outlook; the expected synergies of
the combined Stem/AlsoEnergy company; our ability to successfully
integrate the combined companies; our joint ventures, partnerships
and other alliances; reduction of greenhouse gas (“GHG”) emissions;
the integration and optimization of energy resources; our business
strategies and those of our customers; the global commitment to
decarbonization; our ability to retain or upgrade current
customers, further penetrate existing markets or expand into new
markets; our ability to manage our supply chains and distribution
channels and the effects of natural disasters and other events
beyond our control, such as the COVID-19 pandemic and variants
thereof; our ability to meet contracted customer demand; and future
results of operations, including revenue and Adjusted EBITDA. Such
forward-looking statements are subject to risks, uncertainties, and
other factors that could cause actual results to differ materially
from those expressed or implied by such forward-looking statements,
including but not limited to changing global economic conditions;
our inability to achieve our financial and performance targets and
other forecasts and expectations; our inability to help reduce GHG
emissions; the results of operations and financial condition of our
customers and suppliers; our inability to integrate and optimize
energy resources; pricing pressure; inflation; weather and seasonal
factors; unfavorable effects of health pandemics; challenges,
disruptions and costs of integrating the combined companies and
achieving anticipated synergies, or such synergies taking longer to
realize than expected; risks that the integration disrupts current
plans and operations that may harm the combined company’s business;
uncertainty as to the effects of the transaction on the combined
company’s financial performance; uncertainty as to the effects of
the transaction on the long-term value of Stem’s common stock; the
business, economic and political conditions in the markets in which
Stem and AlsoEnergy operate; the effect of the COVID-19 pandemic on
the workforce, operations, financial results and cash flows of the
combined company; the combined company’s ability to continue to
grow and to manage its growth effectively; the combined company’s
ability to attract and retain qualified employees and key
personnel; the combined company’s ability to comply with, and the
effect on their businesses of, evolving legal standards and
regulations, particularly concerning data protection and consumer
privacy and evolving labor standards; our ability to grow and
manage growth profitably; risks relating to the development and
performance of our energy storage systems and software-enabled
services; the risk that the global commitment to decarbonization
may not materialize as we predict, or even if it does, that we
might not be able to benefit therefrom; our inability to retain or
upgrade current customers, further penetrate existing markets or
expand into new markets; our inability to secure sufficient
inventory from our suppliers to meet customer demand, and provide
us with contracted quantities of equipment; supply chain
interruptions and manufacturing or delivery delays; disruptions in
sales, production, service or other business activities; the risk
that our business, financial condition and results of operations
may be adversely affected by other political, economic, business
and competitive factors; and other risks and uncertainties set
forth in this press release, the section entitled “Risk Factors” in
the registration statement on Form S-1 filed with the SEC on July
19, 2021, and our most recent Forms 10-K, 10-Q and 8-K filed with
or furnished to the SEC. If one or more of these or other risks or
uncertainties materialize (or the consequences of any such
development changes), or should our underlying assumptions prove
incorrect, actual outcomes may vary materially from those reflected
in our forward-looking statements. Forward-looking and other
statements in this press release regarding our environmental,
social, and other sustainability plans and goals are not an
indication that these statements are necessarily material to
investors or required to be disclosed in our SEC filings. In
addition, historical, current and forward-looking environmental,
social, and sustainability-related statements may be based on
standards for measuring progress that are still developing,
internal controls and processes that continue to evolve, and
assumptions that are subject to change in the future. Statements in
this press release are made as of the date of this release, and
Stem disclaims any intention or obligation to update publicly or
revise such statements, whether as a result of new information,
future events or otherwise.
Source: Stem, Inc.
STEM, INC.
CONSOLIDATED BALANCE
SHEETS
(UNAUDITED) (in thousands, except
share and per share amounts)
December 31, 2021
December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents
$
747,780
$
6,942
Short-term investments
173,008
—
Accounts receivable, net
61,701
13,572
Inventory, net
22,720
20,843
Other current assets (includes $213 and
$123 due from related parties as of December 31, 2021 and December
31, 2020, respectively)
18,641
7,920
Total current assets
1,023,850
49,277
Energy storage systems, net
106,114
123,703
Contract origination costs, net
8,630
10,404
Goodwill
1,741
1,739
Intangible assets, net
13,966
12,087
Operating leases right-of-use assets
12,998
358
Other noncurrent assets
24,531
8,282
Total assets
$
1,191,830
$
205,850
LIABILITIES AND STOCKHOLDERS’ EQUITY
(DEFICIT)
Current liabilities:
Accounts payable
$
28,273
$
13,749
Accrued liabilities
25,993
16,072
Accrued payroll
7,453
5,976
Notes payable, current portion
—
33,683
Convertible promissory notes (includes $0
and $45,271 due to related parties as of December 31, 2021 and
December 31, 2020, respectively)
—
67,590
Financing obligation, current portion
15,277
14,914
Deferred revenue, current portion
9,158
36,942
Other current liabilities (includes $306
and $399 due to related parties as of December 31, 2021 and
December 31, 2020, respectively)
1,813
1,589
Total current liabilities
87,967
190,515
Deferred revenue, noncurrent
28,285
15,468
Asset retirement obligation
4,135
4,137
Notes payable, noncurrent
1,687
4,612
Convertible notes, noncurrent
316,542
—
Financing obligation, noncurrent
73,204
73,128
Warrant liabilities
—
95,342
Lease liability, noncurrent
12,183
57
Total liabilities
524,003
383,259
Commitments and contingencies
Stockholders’ equity (deficit):
Preferred stock, $0.0001 par value;
1,000,000 shares authorized as of December 31, 2021 and December
31, 2020, respectively; 0 shares issued and outstanding as of
December 31, 2021 and December 31, 2020, respectively
—
—
Common stock, $0.0001 par value;
500,000,000 shares authorized as of December 31, 2021 and December
31, 2020; 144,671,624 and 40,202,785 issued and outstanding as of
December 31, 2021 and December 31, 2020, respectively
14
4
Additional paid-in capital
1,176,845
230,620
Accumulated other comprehensive income
(loss)
20
(192
)
Accumulated deficit
(509,052
)
(407,841
)
Total stockholders’ equity (deficit)
667,827
(177,409
)
Total liabilities and stockholders’ equity
(deficit)
$
1,191,830
$
205,850
STEM, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(UNAUDITED) (in thousands, except
share and per share amounts)
Years Ended December
31,
2021
2020
2019
Revenue
Service revenue
$
20,463
$
15,645
$
13,482
Hardware revenue
106,908
20,662
4,070
Total revenue
127,371
36,307
17,552
Cost of revenue
Cost of service revenue
28,177
21,187
16,958
Cost of hardware revenue
97,947
19,032
3,854
Total cost of revenue
126,124
40,219
20,812
Gross margin
1,247
(3,912
)
(3,260
)
Operating expenses
Sales and marketing
19,950
14,829
17,462
Research and development
22,723
15,941
14,703
General and administrative
41,648
14,705
12,425
Total operating expenses
84,321
45,475
44,590
Loss from operations
(83,074
)
(49,387
)
(47,850
)
Other income (expense), net
Interest expense
(17,395
)
(20,806
)
(12,548
)
Loss on extinguishment of debt
(5,064
)
—
—
Change in fair value of warrants and
embedded derivative
3,424
(84,455
)
1,493
Other expenses, net
898
(1,471
)
(503
)
Total other income (expense)
(18,137
)
(106,732
)
(11,558
)
Loss before income taxes
(101,211
)
(156,119
)
(59,408
)
Income tax expense
—
(5
)
(6
)
Net loss
$
(101,211
)
$
(156,124
)
$
(59,414
)
Net loss per share attributable to common
shareholders, basic and diluted
$
(0.96
)
$
(4.13
)
$
(1.51
)
Weighted-average shares used in computing
net loss per share, basic and diluted
105,561,139
40,064,087
42,811,383
STEM, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(UNAUDITED) (in thousands)
Year Ended December
31,
2021
2020
2019
OPERATING ACTIVITIES
Net loss
$
(101,211
)
$
(156,124
)
$
(59,414
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization expense
24,473
17,736
13,889
Non-cash interest expense, including
interest expenses associated with debt issuance costs
9,648
10,044
4,759
Stock-based compensation
13,546
4,542
1,531
Change in fair value of warrant liability
and embedded derivative
(3,424
)
84,455
(1,493
)
Noncash lease expense
896
589
906
Accretion expense
229
217
303
Impairment of energy storage systems
4,320
1,395
295
Issuance of warrants for services
9,183
—
—
Net (accretion of discount) amortization
of premium on investments
664
—
—
Other
(50
)
(129
)
(76
)
Changes in operating assets and
liabilities:
Accounts receivable
(48,125
)
(6,988
)
(5,112
)
Inventory
(1,877
)
(17,263
)
(1,553
)
Other assets
(24,783
)
(5,329
)
(1,860
)
Contract origination costs
(2,622
)
(2,552
)
(1,302
)
Right-of-use assets
(199
)
Accounts payable and accrued expenses
33,462
5,684
10,562
Deferred revenue
(14,967
)
31,682
9,007
Lease liabilities
(303
)
(646
)
(230
)
Other liabilities
(126
)
(984
)
110
Net cash used in operating activities
(101,266
)
(33,671
)
(29,678
)
INVESTING ACTIVITIES
Purchase of available-for-sale
investments
(189,858
)
—
—
Sale of available-for-sale investments
16,011
—
—
Purchase of energy storage systems
(3,604
)
(6,196
)
(40,995
)
Capital expenditures on
internally-developed software
(5,970
)
(5,828
)
(5,356
)
Purchase of equity method investment
(1,212
)
—
—
Purchase of property and equipment
(600
)
(12
)
(7
)
Net cash used in investing activities
(185,233
)
(12,036
)
(46,358
)
FINANCING ACTIVITIES
Proceeds from exercise of stock options
and warrants
148,532
422
36
Payments for taxes related to net share
settlement of stock options
(12,622
)
—
—
Net contributions from Merger and PIPE
financing, net of transaction costs of $58,061
550,322
—
—
Proceeds from financing obligations
7,839
16,222
32,310
Repayment of financing obligations
(9,587
)
(10,689
)
(7,309
)
Proceeds from issuance of convertible
notes, net of issuance costs of $14,291 and $240 for the years
ended December 31, 2021 and 2020, respectively
446,827
33,081
63,250
Purchase of capped call options
(66,700
)
—
—
Proceeds from issuance of notes payable,
net of issuance costs of $0 and $1,502 for the years December 31,
2021 and 2020, respectively
3,930
23,498
4,710
Repayment of notes payable
(41,446
)
(22,240
)
(25,796
)
Net cash provided by financing
activities
1,027,095
40,294
67,201
Effect of exchange rate changes on cash
and cash equivalents
242
(534
)
(170
)
Net increase (decrease) in cash and cash
equivalents
740,838
(5,947
)
(9,005
)
Cash and cash equivalents, beginning of
period
6,942
12,889
21,894
Cash and cash equivalents, end of
period
$
747,780
$
6,942
$
12,889
STEM, INC.
RECONCILIATIONS OF NON-GAAP
FINANCIAL MEASURES
(UNAUDITED)
The following table provides a
reconciliation of Adjusted EBITDA to net loss ($ in thousands):
Three Months Ended December
31,
Year Ended December
31,
2021
2020
2021
2020
Net loss
$
(34,054
)
$
(100,887
)
$
(101,211
)
$
(156,124
)
Adjusted to exclude the following:
Depreciation and amortization
11,525
4,335
29,098
20,8718
Interest expense
4,560
6,980
17,395
20,806
Loss on extinguishment of debt
—
—
5,064
—
Stock-based compensation
5,564
3,115
13,546
4,542
Issuance of warrants for services
—
—
9,183
—
Change in fair value of warrants and
embedded derivative
—
81,450
(3,424
)
84,455
Provision for income taxes
—
(137
)
—
5
Adjusted EBITDA
$
(12,405
)
$
(5,144
)
$
(30,349
)
$
(25,445
)
Adjusted EBITDA as used in connection with the Company's 2022
guidance is a non-GAAP financial measure that excludes or has
otherwise been adjusted for items impacting comparability. The
Company is unable to provide a forward-looking reconciliation of
Adjusted EBITDA to net loss, its most directly comparable
forward-looking GAAP financial measure, without unreasonable
efforts, because the Company is currently unable to predict with a
reasonable degree of certainty its change in stock-based
compensation expense and other items that may affect net loss. The
unavailable information could have a significant effect on the
Company’s full year 2022 GAAP financial results.
Adjusted EBITDA for the full years 2021 and 2020 now reflect
adjustments to depreciation and amortization of approximately $2.0
and $3.1 million, respectively, for expenses related to
impairments, decommissioning and forfeited incentives that were not
previously reflected.
The following table provides a reconciliation of non-GAAP gross
margin to GAAP gross margin ($ in millions, except for
percentages):
Three Months Ended December
31,
Year Ended December
31,
2021
2020
2021
2020
Revenue
$
52.8
$
18.6
$
127.4
$
36.3
Cost of revenue
(54.4)
(17.7)
(126.1)
(40.2)
GAAP Gross Margin
(1.6)
0.9
1.2
(3.9)
GAAP Gross Margin %
(3)%
5%
1%
(11)%
Adjustments to Gross Margin:
Amortization of Capitalized Software
1.5
1.2
5.3
4.0
Impairments
2.7
0.4
4.6
3.1
Other Adjustments (1)
0.7
—
2.8
0.3
Non-GAAP Gross Margin
$
3.3
$
2.5
$
14.0
$
3.5
Non-GAAP Gross Margin %
6%
13%
11%
10%
(1) Consists of certain operating
expenses, including communication and cloud service expenditures,
reclassified to cost of revenue.
Key Definitions:
Item
Definition
12-Month Pipeline
Total value (excluding market
participation revenue) of uncontracted, potential hardware and
software revenue from opportunities that are currently being
pursued by Stem direct salesforce and channel partners with
developers and independent power producers seeking energy
optimization services and transfer of energy storage systems, and
which have a reasonable likelihood of contract execution within 12
months of the end of the relevant period. Pipeline is based on
project timelines published by such developers and independent
power producers. We cannot guarantee that our pipeline will result
in meaningful revenue or profitability.
Bookings
Total value of executed customer
agreements, as of the end of the relevant period (e.g. quarterly
bookings or annual bookings)
- Customer contracts are typically executed 6-18 months ahead of
installation
- The Bookings amount typically includes:
- Hardware revenue, which is typically recognized at delivery of
system to customer,
- Software revenue, which represents total nominal software
contract value recognized ratably over the contract period,
- Market participation revenue is excluded from the bookings
value
Contracted Backlog
Total value of bookings in dollars, as of
a specific date
- Backlog increases as new contracts are executed (bookings)
- Backlog decreases as integrated storage systems are delivered
and recognized as revenue
Contracted AUM
Total GWh of systems in operation or under
contract
Contracted Annual Recurring
Revenue
(CARR)
Annual run rate for all executed software
services contracts including contracts signed in the period for
systems that are not yet commissioned or operating
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220224005693/en/
Stem Investor Contacts Ted Durbin, Stem Marc Silverberg,
ICR IR@stem.com (847) 905-4400
Stem Media Contacts Cory Ziskind, ICR
stemPR@icrinc.com
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