Intevac: Fiscal 3Q23 Financial Results

Intevac, Inc. reported financial results for the quarter and 9 months ended September 30, 2023.

“We are pleased to deliver 3FQ23 results well above our prior expectations, reflecting media technology upgrade initiatives currently underway in the HDD industry,” commented Nigel Hunton, president and CEO. “Industry leaders are focused on executing the ramp of next-gen media technology, and within this evolving landscape Intevac has emerged as the enabling technology partner for HDD media production. The revenue upside we achieved in 3FQ23 also demonstrates our operational agility and ability to execute to meet customer timelines for technology upgrades. We expect the collection of HDD receivables in 4FQ23 will drive an increase in our total cash balance by year-end, which we continue to expect will be within the range of $75 to $80 million, as communicated previously.”

“We are also very pleased to announce that during 3FQ23 we entered the formal qualification cycle for our groundbreaking TRIO platform with our JDA partner Corning Incorporated, which is one of the world’s leading innovators in glass and glass-ceramic materials for mobile consumer electronics applications,” he continued. “We expect to complete the qualification stage in 4FQ23 and advance to delivery of the TRIO system to Corning. We continue to believe that our JDA with Corning represents significant potential for Intevac’s future revenue growth. As we look towards 2024 in particular, we expect the results of the recently-completed restructuring process will enable the company to deliver improved operating performance and preserve the strength of our balance sheet.”

3FQ23 summary
Revenue was $17.9 million, compared to $10.8 million in 3FQ22, and consisted of HDD upgrades, spares and service. Gross margin was 39.1%, compared to 45.5%, in 3FQ22. Operating expenses were $8.4 million, compared to $8.1 million in 3FQ22. The operating loss was $1.4 million compared to $3.2 million in 3FQ22. The operating loss of $1.4 million included $2.0 million of restructuring-related costs, including severance.

The net loss was $1.6 million, or $0.06 per diluted share, compared to a net loss of $3.2 million, or $0.13 per diluted share, in 3FQ22. Non-GAAP net income was $0.1 million, or $0.00 per diluted share, compared to a non-GAAP net loss of $3.2 million, or $0.13 per diluted share, in 3FQ22.

Order backlog was $46.5 million on September 30, 2023 compared to $58.2 million on July 1, 2023 and $110.4 million on October 1, 2022. Backlog at September 30, 2023 and July 1, 2023 included 2 200 Lean HDD systems. Backlog at October 1, 2022 included 11 200 Lean HDD systems.

The company ended the quarter with $66.2 million of total cash, cash equivalents, restricted cash and investments and $115.2 million in tangible book value.

First 9 months 2023 summary
Revenue was $39.8 million, compared to first 9 months of 2022 revenues of $24.5 million, and consisted of one 200 Lean HDD system, one refurbished 200 Lean HDD system, HDD upgrades, spares and service. Gross margin was 35.9%, compared to 41.2% in the first 9 months of 2022. Operating expenses were $25.6 million, compared to $23.3 million in the first 9 months of 2022. The operating loss of $11.3 million included $2.0 million of restructuring-related costs, including severance. The net loss was $10.3 million, or $0.40 per diluted share, compared to a net loss of $13.9 million, or $0.55 per diluted share, for the first 9 months of 2022. On a non-GAAP basis, the net loss was $9.0 million, or $0.35 per diluted share, compared to a net loss of $10.8 million, or $0.43 per diluted share, for the first 9 months of 2022.