Mobix Labs Announces Third Quarter 2024 Financial Results
Revenue up 80% sequentially and Gross Margin expansion
Acquisition strategy successfully expanding end markets and diversifying offerings
Increasing Customer Demand
“We are pleased with the June quarter’s results, closing the acquisition of RaGE Systems and our growing pipeline of synergistic M&A opportunities for extending our tech portfolio and end markets,” said
“We were pleased with our sequential revenue growth of 80%, gross margin expansion and closing an additional private placement,” commented
Financial Highlights for Third Quarter of 2024
-
Revenue: Total revenue grew to
$2.1 million in the third quarter of 2024, an 80% increase from$1.1 million in the second quarter of 2024. -
Loss from Operations: GAAP loss from operations for the quarter was
$9.3 million , compared to a loss of$8.6 million for the second quarter of 2024. On a non-GAAP basis, adjusted loss from operations for the quarter was$4.1 million compared to a loss of$4.1 million for the second quarter of 2024.
Recent Business Highlights
- Completed the acquisition of RaGE Systems, a leader in radio frequency and mmWave design and manufacturing services. Another key milestone for growth and affirmation of Mobix Labs’ strong global acquisition strategy.
-
Announced the intent to acquire
J-Mark Connectors Inc. This acquisition is expected to enhance Mobix Labs’ sales strategy and boost gross margins, particularly in the high-demand military, aerospace, and defense sectors. The addition of J-Mark’s expertise is expected to strengthenMobix Labs' position, elevate market presence, enhance customer access, and secure major accounts in the aerospace and defense industries. -
Issued private placement of pre-funded warrants with gross proceeds of
$4 million , before payment of fees and expenses. - Participated at the Leidos Supplier Innovation & Technology Symposium to highlight technologies designed and manufactured for various high-reliability markets, including wireless infrastructure, security transport, military, aerospace, and medical applications. Key technology showcased at the event was the Mobix Labs’ SMART Edge Device product line.
- Introduced a new family of filtered D-sub connectors designed to eliminate unwanted electromagnetic interference (EMI) in defense, aerospace, medical, and commercial applications. These connectors feature robust construction and superior EMI filtering capabilities, ensuring optimal performance and reliability in the most demanding environments.
- Launched latest EMI filtered connectors for defense and aerospace applications. These versatile connectors can be customized with planar arrays, ceramic Pi Tubes, or chip capacitors to meet demanding military specifications, ensuring optimal cost, quality and performance.
-
Announced a strategic partnership with
TalkingHeads Wireless (THW) to develop a new generation of cost-effective, energy-efficient 5G base stations. THW’s 5G radio solution uses AI technology to optimize tower energy consumption, while Mobix Labs’ broad portfolio of products including ICs, antennas, and active optical cables and transceivers delivers significant advantages in performance, efficiency, cost and size for 5G base stations. -
In collaboration with the
U.S. defense sector,Mobix Labs was selected as a supplier of connectors to be used in the Navy’s Standard Missile-6 program and has completed its initial product delivery. -
Mobix Labs electromagnetic filtering products received a BAE Systems ‘Partner 2 Win’ Gold Tier Award.Mobix Labs was selected from many suppliers that delivered exceptional performance and contributions to supply chain success for BAE Systems’ Electronic Systems sector in 2023.
Non-GAAP Financial Measures
In addition to reporting financial results in accordance with
- Adjusted Gross Profit, which is defined as GAAP Gross Profit excluding amortization of acquisition-related intangible assets, inventory write-offs and stock-based compensation expense;
- Adjusted Loss from Operations, which is defined as GAAP Loss from Operations excluding depreciation, amortization of acquisition-related intangible assets, merger and acquisition-related expenses, inventory write-offs and stock-based compensation expense.
The Company’s management believes it is useful to consider these non-GAAP financial measures, together with the corresponding GAAP financial measures, as they provide more transparency into current business trends, exclusive of the effects of certain non-cash expenses, acquisition-related charges, and items that may not be present in comparative fiscal periods. Management believes that, when considered together with reported GAAP financial measures, these non-GAAP financial measures are useful to investors and management in understanding the Company’s ongoing operations and operating trends and in analyzing the Company’s underlying financial performance.
These non-GAAP financial measures are not intended to be considered in isolation from, as a substitute for, or superior to, the comparable GAAP measures. These non-GAAP financial measures may be different from similarly titled measures used by other companies. In the future,
Financial Outlook
Consolidated revenues are expected to fall within a range of
Conference Call Information
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https://register.vevent.com/register/BI89bf294de932451980c72a782d621ccf |
Shortly after the completion of the conference call, an archived version of the webcast will be available on the Company’s investor relations website at investors.mobixlabs.com.
About
At
Note Regarding Customer Pipeline Statistic
“Customer pipeline” reflects estimated potential future business based on interest expressed by potential customers for qualified programs, stated in terms of estimated revenue that may be realized in one or more future periods. All customer pipeline information constitutes forward-looking statements. Customer pipeline is not a proxy for backlog or an estimate of future revenue, nor should it be considered as any other measure or indicator of financial performance. Rather,
Forward-looking Information
This press release and the related earnings call contain “forward-looking statements” regarding the intent, beliefs or current expectations of the Company for purposes of the federal securities laws. These forward-looking statements include, but are not limited to, statements regarding
As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include (i) the risk that the price of our securities may be volatile due to a variety of factors, including changes in the highly competitive industries in which we operate, variations in performance across competitors, changes in laws, regulations, technologies, the global supply chain, and macro-economic and social environments affecting our business; (ii) our ability to regain compliance and maintain our listing of securities on Nasdaq; (iii) the risks concerning our ability to continue as a going concern; (iv) the inability to meet future capital requirements and risks related to our ability to raise additional capital including potential dilution to our stockholders; (v) the risk that we are unable to successfully commercialize our products and solutions, or experience significant delays in doing so; (vi) the risk that we may not be able to generate income from operations in the foreseeable future; (vii) the risk that we experience difficulties in managing our growth and expanding operations; (viii) the risk that we may not be able to consummate planned strategic acquisitions, or fully realize anticipated benefits or capture synergies from past or future acquisitions or investments; (ix) the risk that we may be unable to successfully defend ourselves in ongoing litigation or that additional actions may be commenced against us; (x) the risk that our patent applications may not be approved or may take longer than expected, and we may incur substantial costs in enforcing and protecting our intellectual property; (xi) the risk of being an early stage company and that our limited operating history may make it difficult to evaluate our future prospects and the risks and challenges that we may encounter; (xii) the risk that we cannot predict whether we will maintain revenue growth; (xiii) the risk that the markets for our semiconductor products and solutions are highly competitive; (xiv) the risk that future sales of our Class A Common Stock may cause the market price of our Class A Common Stock to drop significantly, even if our business is doing well; and (xv) inflation and unfavorable global economic conditions could adversely affect our business.
| Condensed Consolidated Statements of Operations and Comprehensive Loss | ||||||||||||||||
| (unaudited, in thousands, except share and per share amounts) | ||||||||||||||||
| Three months ended |
Nine months ended |
|||||||||||||||
|
2024 |
2023 |
2024 |
2023 |
|||||||||||||
| Net revenue |
$ |
2,058 |
|
$ |
80 |
|
$ |
3,488 |
|
$ |
791 |
|
||||
| Costs and expenses | ||||||||||||||||
| Cost of revenue |
|
1,327 |
|
|
285 |
|
|
2,608 |
|
|
1,188 |
|
||||
| Research and development |
|
1,369 |
|
|
3,159 |
|
|
4,328 |
|
|
9,209 |
|
||||
| Selling, general and administrative |
|
8,710 |
|
|
6,375 |
|
|
31,731 |
|
|
21,198 |
|
||||
| Loss from operations |
|
(9,348 |
) |
|
(9,739 |
) |
|
(35,179 |
) |
|
(30,804 |
) |
||||
| Interest expense |
|
127 |
|
|
309 |
|
|
1,232 |
|
|
1,186 |
|
||||
| Change in fair value of earnout liability |
|
(661 |
) |
|
- |
|
|
(30,599 |
) |
|
- |
|
||||
| Change in fair value of PIPE make-whole liability |
|
310 |
|
|
- |
|
|
(122 |
) |
|
- |
|
||||
| Change in fair value of private warrants |
|
(68 |
) |
|
- |
|
|
412 |
|
|
- |
|
||||
| Change in fair value of SAFEs |
|
- |
|
|
(30 |
) |
|
10 |
|
|
528 |
|
||||
| Merger-related transaction costs expensed |
|
- |
|
|
- |
|
|
4,009 |
|
|
- |
|
||||
| Other non-operating losses, net |
|
128 |
|
|
- |
|
|
1,177 |
|
|
- |
|
||||
| Loss before income taxes |
|
(9,184 |
) |
|
(10,018 |
) |
|
(11,298 |
) |
|
(32,518 |
) |
||||
| Provision (benefit) for income taxes |
|
(1,505 |
) |
|
(14 |
) |
|
(2,801 |
) |
|
18 |
|
||||
| Net loss and comprehensive loss |
|
(7,679 |
) |
|
(10,004 |
) |
|
(8,497 |
) |
|
(32,536 |
) |
||||
| Deemed dividend |
|
- |
|
|
- |
|
|
661 |
|
|
- |
|
||||
| Net loss available to common stockholders |
$ |
(7,679 |
) |
$ |
(10,004 |
) |
$ |
(9,158 |
) |
$ |
(32,536 |
) |
||||
| Net loss per common share: | ||||||||||||||||
| Basic |
$ |
(0.25 |
) |
$ |
(0.65 |
) |
$ |
(0.35 |
) |
$ |
(2.34 |
) |
||||
| Diluted |
$ |
(0.25 |
) |
$ |
(0.65 |
) |
$ |
(0.36 |
) |
$ |
(2.34 |
) |
||||
| Weighted-average common shares outstanding: | ||||||||||||||||
| Basic |
|
30,552,063 |
|
|
15,335,373 |
|
|
26,350,138 |
|
|
13,907,357 |
|
||||
| Diluted |
|
30,552,063 |
|
|
15,335,373 |
|
|
26,411,020 |
|
|
13,907,357 |
|
||||
| Reconciliation of Non-GAAP Financial Measures | ||||||||||||||||
| (unaudited, in thousands) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
|
2024 |
2023 |
2024 |
2023 |
|||||||||||||
| Computation of Adjusted Loss from Operations: | ||||||||||||||||
| GAAP loss from operations |
$ |
(9,348 |
) |
$ |
(9,739 |
) |
$ |
(35,179 |
) |
$ |
(30,804 |
) |
||||
| Depreciation |
|
127 |
|
|
112 |
|
|
357 |
|
|
337 |
|
||||
| Amortization of acquisition related intangible assets |
|
481 |
|
|
210 |
|
|
1,117 |
|
|
631 |
|
||||
| Merger & acquisition- related expenses |
|
976 |
|
|
27 |
|
|
3,491 |
|
|
71 |
|
||||
| Inventory write-off |
|
- |
|
|
- |
|
|
125 |
|
|
- |
|
||||
| Stock-based compensation expense |
|
3,622 |
|
|
4,752 |
|
|
17,768 |
|
|
14,387 |
|
||||
| Adjusted loss from operations |
$ |
(4,142 |
) |
$ |
(4,638 |
) |
$ |
(12,321 |
) |
$ |
(15,378 |
) |
||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
|
2024 |
2023 |
2024 |
2023 |
|||||||||||||
| GAAP gross profit: | ||||||||||||||||
| GAAP net revenue |
$ |
2,058 |
|
$ |
80 |
|
$ |
3,488 |
|
$ |
791 |
|
||||
| GAAP cost of revenue |
|
1,327 |
|
|
285 |
|
|
2,608 |
|
|
1,188 |
|
||||
| GAAP gross profit |
$ |
731 |
|
$ |
(205 |
) |
$ |
880 |
|
$ |
(397 |
) |
||||
| GAAP gross margin % |
|
35.5 |
% |
|
-256.3 |
% |
|
25.2 |
% |
|
-50.2 |
% |
||||
| Computation of Adjusted Gross Profit: | ||||||||||||||||
| GAAP gross profit |
$ |
731 |
|
$ |
(205 |
) |
$ |
880 |
|
$ |
(397 |
) |
||||
| Amortization of acquisition-related intangible assets |
|
72 |
|
|
68 |
|
|
208 |
|
|
204 |
|
||||
| Inventory write-off |
|
- |
|
|
- |
|
|
125 |
|
|
- |
|
||||
| Stock-based compensation expense |
|
27 |
|
|
12 |
|
|
27 |
|
|
34 |
|
||||
| Adjusted Gross Profit |
$ |
830 |
|
$ |
(125 |
) |
$ |
1,240 |
|
$ |
(159 |
) |
||||
| Adjusted Gross Margin % |
|
40.3 |
% |
|
-156.3 |
% |
|
35.6 |
% |
|
-20.1 |
% |
||||
| Condensed Consolidated Balance Sheets | ||||||||
| (unaudited, in thousands, except share and per share amounts) | ||||||||
|
2024 |
2023 |
|||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash |
$ |
205 |
|
$ |
89 |
|
||
| Accounts receivable, net |
|
1,478 |
|
|
53 |
|
||
| Inventory |
|
1,906 |
|
|
319 |
|
||
| Prepaid expenses and other current assets |
|
481 |
|
|
369 |
|
||
| Total current assets |
|
4,070 |
|
|
830 |
|
||
| Property and equipment, net |
|
1,915 |
|
|
1,859 |
|
||
| Intangible assets, net |
|
18,570 |
|
|
5,287 |
|
||
|
|
15,206 |
|
|
5,217 |
|
|||
| Operating lease right-of-use assets |
|
1,086 |
|
|
1,030 |
|
||
| Deferred transaction costs |
|
- |
|
|
4,125 |
|
||
| Other assets |
|
430 |
|
|
400 |
|
||
| Total assets |
$ |
41,277 |
|
$ |
18,748 |
|
||
| LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK | ||||||||
| AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
| Current liabilities | ||||||||
| Accounts payable |
$ |
10,572 |
|
$ |
8,995 |
|
||
| Accrued expenses and other current liabilities |
|
8,839 |
|
|
4,519 |
|
||
| Deferred purchase consideration |
|
2,466 |
|
|
- |
|
||
| Notes payable |
|
723 |
|
|
1,286 |
|
||
| Notes payable - related parties |
|
2,495 |
|
|
3,793 |
|
||
| Simple agreements for future equity |
|
- |
|
|
1,512 |
|
||
| Operating lease liabilities, current |
|
406 |
|
|
318 |
|
||
| Total current liabilities |
|
25,501 |
|
|
20,423 |
|
||
| Earnout liability |
|
2,960 |
|
|
- |
|
||
| PIPE make-whole liability |
|
1,949 |
|
|
- |
|
||
| Deferred tax liability |
|
361 |
|
|
86 |
|
||
| Operating lease liabilities, noncurrent |
|
1,139 |
|
|
1,280 |
|
||
| Other noncurrent liabilities |
|
831 |
|
|
- |
|
||
| Total liabilities |
|
32,741 |
|
|
21,789 |
|
||
| Redeemable convertible preferred stock |
|
- |
|
|
2,300 |
|
||
| Stockholders' deficit | ||||||||
| Common stock, |
|
- |
|
|
- |
|
||
| Additional paid-in capital |
|
101,456 |
|
|
78,421 |
|
||
| Accumulated deficit |
|
(92,920 |
) |
|
(83,762 |
) |
||
| Total stockholders' equity (deficit) |
|
8,536 |
|
|
(5,341 |
) |
||
| Total liabilities, redeemable convertible preferred stock and stockholders' equity (deficit) |
$ |
41,277 |
|
$ |
18,748 |
|
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240821190590/en/
Media Contact:
Jeff Fox, The Blueshirt Group
jeff@blueshirtgroup.com
Investor Contact:
Lori Barker, The Blueshirt Group
lori@blueshirtgroup.com
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