UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________

 

FORM 8-K
_____________________

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event Reported): August 3, 2017  

 

Adesto Technologies Corporation
(Exact Name of Registrant as Specified in Charter)

 

Delaware 001-37582 16-1755067
(State or Other Jurisdiction of Incorporation) (Commission File Number) (I.R.S. Employer Identification Number)

 

 

3600 Peterson Way, Santa Clara, California 95054
(Address of Principal Executive Offices) (Zip Code)

 

(408) 400-0578 
(Registrant's telephone number, including area code)

 

1250 Borregas Avenue, Sunnyvale, CA 94089
(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

  [ ]   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
  [ ]   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
  [ ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
  [ ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company [ X ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ X ]

 

 

 

Item 2.02. Results of Operations and Financial Condition.

 

On August 3, 2017, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

 

Item 9.01. Financial Statements and Exhibits.

 

Exhibit 99.1. Press release dated August 3, 2017

 

 

 

 

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  Adesto Technologies Corporation
     
     
Date: August 3, 2017 By:  /s/ RON SHELTON        
    Ron Shelton
    Chief Financial Officer and Secretary
     

 

 

 

 

 

 

 

 

EXHIBIT INDEX

 

 

 

Exhibit Number   Description
     
99.1   Press Release dated August 3, 2017

 

 

EdgarFiling

EXHIBIT 99.1

Adesto Technologies Reports Second Quarter 2017 Financial Results

Record Revenue Exceeds Guidance Growing 30% Year-Over-Year; Achieves Positive EBITDA

SANTA CLARA, Calif., Aug. 03, 2017 (GLOBE NEWSWIRE) -- Adesto Technologies Corporation (NASDAQ:IOTS), a leading provider of application-specific, feature-rich and ultra-low power non-volatile memory products, today announced financial results for its second quarter ended June 30, 2017.

Second Quarter Highlights:

Commenting on the quarter, Narbeh Derhacobian, Adesto’s president and CEO, stated, ”Our achievement of 30% year-over-year revenue growth and positive adjusted EBITDA is further evidence of our continued execution and a culmination of our efforts over the last four quarters to drive meaningful and sustainable top line growth. The accumulation of design wins we have secured over the past 18 months are ramping into production at an increasing rate. Additionally, our strategy to target high-volume applications and expand our footprint with new and existing customers is also materializing in our results. A key factor underpinning this progress has been our investment in expanding our product portfolio as OEMs actively seek new types of memory that can efficiently address the low density and low power requirements of the rapidly growing IoT and connected device markets.

“Also during the quarter we further strengthened our balance sheet, raising $20 million in gross proceeds from a follow-on public offering. This additional cash will enable us to further invest in our future growth, while also maintaining a solid balance sheet for supporting our expanding list of tier-one customers. We also continued to closely manage our operating expenses, contributing to the achievement of our goal to reach positive EBITDA by the middle of this year.

“As we look to the second half, we are guiding for another quarter of 30% year-over-year revenue growth in the third quarter driven by ramping design wins and increasing traction from new products, with continued strong momentum into the fourth quarter. Most notably, the combination of our accelerating top line growth and well-managed operating expenses position us to achieve non-GAAP profitability exiting the year.”

Second Quarter 2017 Results
Revenue in the quarter ended June 30, 2017 was $13.4 million, an increase of 30.4% from $10.3 million in the second quarter of 2016 and an increase of 18.6% from $11.3 million last quarter. Revenue for the first six months of 2017 grew 20.8% to $24.7 million from $20.5 million for the same period in 2016. The year-over-year increase was due primarily to past design wins ramping into production at an accelerating pace.

Gross margin in the second quarter of 2017 was 50.1%, compared to 46.0% in the second quarter of 2016 and 49.1% in the first quarter of 2017. The increase in gross margin was due primarily to improved product mix and a favorable pricing environment.

GAAP operating expenses in the second quarter of 2017 were $8.3 million, compared to $8.7 million in the prior year quarter and $8.1 million last quarter. On a non-GAAP basis, operating expenses in the second quarter of 2017 were $7.0 million, compared to $7.6 million in the second quarter of 2016 and $7.0 million in the first quarter of 2017 quarter.

GAAP net loss in the second quarter of 2017 was $1.8 million, or ($0.11) per share, compared to a GAAP net loss of $4.3 million, or ($0.29) per share, in the second quarter of 2016 and a GAAP net loss of $2.8 million, or ($0.18) per share, in the previous quarter.

On a non-GAAP basis, net loss in the second quarter of 2017 was $0.5 million, or ($0.03) per share, compared to a net loss of $3.1 million, or ($0.21) per share, in the second quarter of 2016 and a net loss of $1.6 million, or ($0.10) per share, last quarter.

Adjusted EBITDA for the second quarter was a positive $0.1 million, compared to a loss of $2.7 million in the second quarter of 2016 and a loss of $1.1 million in the previous quarter.

A reconciliation of our GAAP results to non-GAAP results is provided in the financial statement tables following the text of this press release.

Cash and cash equivalents totaled $31.9 million as of June 30, 2017, compared to $17.5 million as of March 31, 2017.

Business Outlook
For the third quarter of 2017, the Company expects revenue to range between $14.3 million and $14.7 million resulting in another quarter of record revenue. Gross margin is expected to be between 48% and 50%. GAAP operating expenses are expected to range between $8.6 million and $8.8 million, which includes approximately $1.1 million in stock-based compensation and $0.3 million in amortization of acquisition-related intangible assets. 

Conference Call Information
Adesto will host a conference call today at 2:00 p.m. Pacific Time to discuss its financial results. Investors and analysts may join the call by dialing 1-844-419-1786 and providing confirmation code 58904152. International callers may join the teleconference by dialing +1-216-562-0473 using the same confirmation code. The call will also be available as a live and archived webcast in the Investor Relations section of the Company’s website at http://www.adestotech.com.

A telephone replay of the conference call will be available approximately two hours after the conference call until Wednesday, August 10, 2017 at midnight Pacific Time. The replay dial-in number is 1-855-859-2056. International callers should dial 1-404-537-3406. The pass code is 58904152.

Non-GAAP Financial Information
To supplement our financial results presented in accordance with generally accepted accounting principles (GAAP), this press release and the accompanying tables and the related earnings conference call contain certain non-GAAP financial measures, including adjusted EBITDA, non-GAAP net loss and non-GAAP net loss per share. It also contains projected non-GAAP operating expenses. We believe these non-GAAP financial measures are useful in evaluating our past financial performance and future results. Our non-GAAP financial measures should not be considered in isolation or as a substitute for comparable GAAP measures and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP.  Our management regularly uses our supplemental non-GAAP financial measures internally to help us evaluate growth trends, establish budgets, measure the effectiveness of our business strategies and assess operational efficiencies. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies. Our non-GAAP financial measures include adjustments based on the following items:  

Our non-GAAP Financial Measures are described as follows: 

For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “Reconciliation of GAAP to Non-GAAP Financial Information.”

About Adesto Technologies
Adesto Technologies (NASDAQ:IOTS) is a leading provider of application-specific, feature-rich and ultra-low power non-volatile memory products. The company has designed and built a portfolio of innovative products with intelligent features to conserve energy and enhance performance, including Fusion Serial Flash, DataFlash®, EcoXiP™ and products based on Conductive Bridging RAM (CBRAM®). CBRAM® is a breakthrough technology platform that enables 100 times less energy consumption than today’s memory technologies without sacrificing speed and performance. Adesto is focused on delivering differentiated solutions and helping its customers usher in the era of the Internet of Things (IoT). For more information, please visit http://www.adestotech.com.

Forward looking Statements
The quotes of our Chief Executive Officer in this release regarding our prospects for growth, product momentum and expected revenue performance, as well as all statements under “Business Outlook” are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause our actual results to differ materially, including, but not limited to: our ability to predict the timing of design wins entering production and the potential future revenue associated with our design wins; market adoption of our CBRAM-based products; our limited operating history; our rate of growth; our ability to predict customer demand for our existing and future products and to secure adequate manufacturing capacity; consumer demand conditions affecting our end markets; our ability to manage our growth; our ability to hire, retain and motivate employees; the effects of competition, including price competition; technological, regulatory and legal developments; and developments in the economy and financial markets.

For a detailed discussion of these and other risk factors, please refer to our filings with the Securities and Exchange Commission, including the final prospectus related to our initial public offering, which are available on our investor relations Web site (ir.adestotech.com) and on the SEC’s Web site (www.sec.gov).

All information provided in this release and in the attachments is as of Aug. 3, 2017, and stockholders of Adesto are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date such statements are made. Adesto does not undertake any obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after this Aug. 3, 2017 press release, or to reflect the occurrence of unanticipated events.

            
            
 ADESTO TECHNOLOGIES CORPORATION  
 CONDENSED CONSOLIDATED BALANCE SHEETS  
 (in thousands)  
 (unaudited)  
            
            
     June 30,  December 31, 
     2017   2016  
Assets        
Current assets:        
 Cash and cash equivalents $  31,893   $  19,719  
 Accounts receivable, net    9,055      6,111  
 Inventories    4,361      5,182  
 Prepaid expenses    488      462  
 Other current assets    114      105  
  Total current assets    45,911      31,579  
Property and equipment, net    6,349      5,962  
Intangible assets, net    7,706      8,324  
Other non-current assets    430      296  
Goodwill    22      22  
Total assets $  60,418   $  46,183  
Liabilities and Stockholders' Equity        
Current liabilities:        
 Accounts payable    6,247      5,167  
 Accrued compensation and benefits    2,174      1,599  
 Accrued expenses and other current liabilities              2,095      2,176  
 Term loan, current    6,486      6,466  
  Total current liabilities    17,002      15,408  
Line of credit    1,987      1,807  
Term loan, non-current    6,527      9,775  
Deferred rent, non-current    2,618      2,826  
Deferred tax liability, non-current    2      2  
   Total liabilities    28,136      29,818  
            
Stockholders' equity        
 Common stock    2      2  
 Additional paid-in capital    131,243      110,749  
 Accumulated other comprehensive loss    (281)     (230) 
 Accumulated deficit    (98,682)     (94,156) 
Total stockholders' equity    32,282      16,365  
Total liabilities and stockholders' equity $  60,418   $  46,183  
            

 

                    
   ADESTO TECHNOLOGIES CORPORATION  
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
     (in thousands, except for share and per share amounts)  
     (unaudited)  
                    
                    
     Three Months Ended June 30,    Six Months Ended June 30,   
    2017   2016   2017   2016   
                    
 Revenue   $   13,412    $   10,282    $   24,719    $   20,458   
 Cost of revenue     6,689      5,548      12,442      10,728   
  Gross profit     6,723      4,734      12,277      9,730   
 Operating expenses:                  
  Research and development     3,675      4,200      7,047      8,137   
  Sales and marketing     2,911      2,842      5,511      5,445   
  General and administrative     1,673      1,690      3,808      3,398   
  Gain from settlement with former foundry supplier     -       -       -       (1,962)  
   Total operating expenses     8,259      8,732      16,366      15,018   
 Loss from operations     (1,536)     (3,998)     (4,089)     (5,288)  
 Other income (expense):                  
  Interest expense, net     (198)     (224)     (411)     (482)  
  Other income (expense), net     (4)     (33)     14      (11)  
   Total other income (expense), net     (202)     (257)     (397)     (493)  
 Loss before provision for income taxes     (1,738)     (4,255)     (4,486)     (5,781)  
 Provision for income taxes     13      17      40      31   
 Net loss   $   (1,751)   $   (4,272)   $   (4,526)   $   (5,812)  
                    
 Net loss per share                  
  Basic and diluted   $   (0.11)   $   (0.29)   $   (0.28)   $   (0.39)  
 Weighted average number of shares used in computing                       
 net loss per share                  
  Basic and diluted     16,343,248      14,983,132      15,994,703      14,978,925   
                    

 

                   
     ADESTO TECHNOLOGIES CORPORATION  
     RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
 
     (in thousands, except for share and per share amounts)
 
      (unaudited) 
 
       
       
     
  Three Months Ended    Six Months Ended 
  June 30, 2017   June 30, 2016   June 30, 2017   June 30, 2016
           
GAAP gross profit    $    6,723    $    4,734    $    12,277    $    9,730 
Stock-based compensation expense       30       20       51       38 
Non-GAAP gross profit    $    6,753    $    4,754    $    12,328    $    9,768 
                   
GAAP research and development expenses    $    3,675    $    4,200    $    7,047    $    8,137 
Stock-based compensation expense       (309)      (259)      (564)      (514)
Amortization of acquisition-related intangible assets       (121)      (121)      (243)      (242)
Non-GAAP research and development expenses    $    3,245    $    3,820    $    6,240    $    7,381 
                   
GAAP sales and marketing expenses    $    2,911    $    2,842    $    5,511    $    5,445 
Stock-based compensation expense       (215)      (175)      (382)      (344)
Amortization of acquisition-related intangible assets       (188)      (188)      (375)      (376)
Non-GAAP sales and marketing expenses    $    2,508    $    2,479    $    4,754    $    4,725 
                   
GAAP general and administrative expenses    $    1,673    $    1,690    $    3,808    $    3,398 
Stock-based compensation expense       (428)      (366)      (809)      (733)
Amortization of acquisition-related intangible assets       -        -        -        -  
Non-GAAP general and administrative expenses    $    1,245    $    1,324    $    2,999    $    2,665 
                   
GAAP operating expenses    $    8,259    $    8,732    $    16,366    $    15,018 
Stock-based compensation expense       (952)      (800)      (1,755)      (1,591)
Amortization of acquisition-related intangible assets       (309)      (309)      (618)      (618)
Gain from settlement with former foundry supplier       -        -        -        1,962 
Non-GAAP operating expenses    $    6,998    $    7,623    $    13,993    $    14,771 
                   
GAAP loss from operations    $    (1,536)   $    (3,998)   $    (4,089)   $    (5,288)
Stock-based compensation expense       982       820       1,806       1,629 
Amortization of acquisition-related intangible assets       309       309       618       618 
Gain from settlement with former foundry supplier       -        -        -        (1,962)
Non-GAAP loss from operations    $    (245)   $    (2,869)   $    (1,665)   $    (5,003)
                   
               
Reconciliation from GAAP net loss to adjusted EBITDA:               
GAAP net loss:    $    (1,751)   $    (4,272)   $    (4,526)   $    (5,812)
 Stock-based compensation expense       982       820       1,806       1,629 
 Gain from settlement with former foundry supplier      -        -        -        (1,962)
 Amortization of acquisition-related intangible assets     309       309       618       618 
   Non-GAAP net loss         (460)      (3,143)      (2,102)      (5,527)
 Interest expense       206       236       429       508 
 Provision for income taxes       13       17       40       31 
 Depreciation and amortization       340       199       644       429 
  Adjusted EBITDA  $    99    $    (2,691)   $    (989)   $    (4,559)
                  
               
Non-GAAP basic and diluted net loss per share  ($0.03)   ($0.21)   ($0.13)   ($0.37)
               
Weighted-average number of shares used in computing               
non-GAAP net loss per share   16,343,248     14,983,132     15,994,703     14,978,925 
     

 

Company Contact:
David Viera
Director, Corporate Communications
P: 408-419-4844
E: david.viera@adestotech.com

Adesto Technologies Investor Relations:
Shelton Group
Leanne K. Sievers, President
P: 949-836-4276
E: sheltonir@sheltongroup.com