lasr-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________________________

FORM 10-Q

________________________________________________________

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-38462

________________________________________________________

NLIGHT, INC.

(Exact name of Registrant as specified in its charter)

________________________________________________________

Delaware

91-2066376

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification Number)

4637 NW 18th Avenue

Camas, Washington 98607

(Address of principal executive office, including zip code)

(360) 566-4460

(Registrant's telephone number, including area code)

__________________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol	Name of Exchange on which Registered
Common Stock, par value $0.0001 per share	LASR	The Nasdaq Stock Market LLC

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

☒

Accelerated Filer

☐

Non-Accelerated Filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 2, 2022, the Registrant had 44,551,190 shares of common stock outstanding.


TABLE OF CONTENTS
			Page

Part I. Financial Information			1
Item 1. Unaudited Interim Financial Statements			1
Consolidated Balance Sheets: March 31, 2022 and December 31, 202 1 (unaudited)			1
Consolidated Statements of Operations: Three Months Ended March 31, 2022 and 20 21 (unaudited)			2
Consolidated Statements of Comprehensive Loss: Three Months Ended March 31, 2022 and 2021 (unaudited)			3
Consolidated Statements of Stockholders' Equity: Three Months Ended March 31, 2022 and 2021 (unaudited)			4
Consolidated Statements of Cash Flows: Three Months Ended March 31, 2022 and 2021 (unaudited)			5
Notes to Consolidated Financial Statements (unaudited)			6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			14
Item 3. Quantitative and Qualitative Disclosures About Market Risk			22
Item 4. Controls and Procedures			22
Part II. Other Information			23
Item 1. Legal Proceedings			23
Item 1A. Risk Factors			23
Item 6. Exhibits			24
Signatures			25

Table of Contents

PART I

ITEM 1. FINANCIAL STATEMENTS

nLIGHT, Inc.

Consolidated Balance Sheets

(In thousands)

(Unaudited)


	As of
	March 31, 2022		December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	134,949	$	146,534
Accounts receivable, net of allowances of $303 and $303	36,912		41,574
Inventory	77,240		73,746
Prepaid expenses and other current assets	20,398		15,350
Total current assets	269,499		277,204
Restricted cash	250		250
Lease right-of-use assets	17,646		17,048
Property, plant and equipment, net	58,309		56,101
Intangible assets, net	5,996		6,698
Goodwill	12,405		12,420
Other assets, net	3,808		3,897
Total assets	$	367,913	$	373,618

Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	23,124	$	26,347
Accrued liabilities	13,384		14,730
Deferred revenues	983		1,629
Current portion of lease liabilities	3,141		3,066

Total current liabilities	40,632		45,772
Non-current income taxes payable	7,320		7,149
Long-term lease liabilities	15,190		14,612

Other long-term liabilities	4,193		3,952
Total liabilities	67,335		71,485
Stockholders' equity:

Common stock - $0.0001 par value; 190,000 shares authorized, 44,538 and 44,248 shares issued and outstanding at March 31, 2022, and December 31, 2021, respectively	15		15
Additional paid-in capital	477,924		470,760
Accumulated other comprehensive loss	(683)		(587)
Accumulated deficit	(176,678)		(168,055)
Total stockholders’ equity	300,578		302,133
Total liabilities and stockholders’ equity	$	367,913	$	373,618

See accompanying notes to consolidated financial statements.

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nLIGHT, Inc.

Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)


	Three Months Ended March 31,
		2022		2021
Revenue:
Products		$	51,061	$	47,335
Development		13,398		14,010
Total revenue		64,459		61,345
Cost of revenue:
Products		35,768		30,395
Development		12,514		13,305
Total cost of revenue		48,282		43,700
Gross profit		16,177		17,645
Operating expenses:
Research and development		13,711		11,710
Sales, general, and administrative		10,775		11,714
Total operating expenses		24,486		23,424
Loss from operations		(8,309)		(5,779)
Other income (expense):
Interest expense, net		—		(74)
Other income, net		29		26
Loss before income taxes		(8,280)		(5,827)
Income tax expense		343		322
Net loss		$	(8,623)	$	(6,149)


Net loss per share, basic and diluted		$	(0.20)	$	(0.15)


Shares used in per share calculations, basic and diluted		43,655		40,048

See accompanying notes to consolidated financial statements.

Table of Contents

nLIGHT, Inc.

Consolidated Statements of Comprehensive Loss

(In thousands)

(Unaudited)


	Three Months Ended March 31,
		2022		2021
Net loss		$	(8,623)	$	(6,149)
Other comprehensive loss:
Foreign currency translation adjustments, net of tax		(96)		(662)
Comprehensive loss		$	(8,719)	$	(6,811)

See accompanying notes to consolidated financial statements.

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nLIGHT, Inc.

Consolidated Statements of Stockholders' Equity

(In thousands)

(Unaudited)


		Three Months Ended March 31, 2022
	Common stock	Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit			Total stockholders' equity
			Shares					Amount














Balance, December 31, 2021		44,248		$	15	$	470,760		$	(587)	$	(168,055)	$	302,133
Net loss		—		—		—			—		(8,623)		(8,623)

Issuance of common stock pursuant to exercise of stock options		423		—		689			—		—		689
Issuance of common stock pursuant to vesting of restricted stock awards and units, net of stock withheld for tax		7		—		(78)			—		—		(78)
Restricted stock forfeited in connection with transition agreement		(140)		—		—			—		—		—

Stock-based compensation		—		—		6,553			—		—		6,553
Cumulative translation adjustment, net of tax		—		—		—			(96)		—		(96)
Balance, March 31, 2022		44,538		$	15	$	477,924		$	(683)	$	(176,678)	$	300,578


		Three Months Ended March 31, 2021
	Common stock		Additional paid-in capital			Accumulated other comprehensive loss		Accumulated deficit		Total stockholders' equity
		Shares			Amount
Balance, December 31, 2020		39,793	$	15		$	358,544	$	(259)	$	(138,386)	$	219,914
Net loss		—	—			—		—		(6,149)		(6,149)
Proceeds from follow-on offering, net of offering costs		2,537	—			82,355		—		—		82,355
Issuance of common stock pursuant to exercise of stock options		452	—			574		—		—		574
Issuance of common stock pursuant to vesting of restricted stock awards and units, net of stock withheld for tax		1	—			(31)		—		—		(31)

Stock-based compensation		—	—			8,054		—		—		8,054
Cumulative translation adjustment, net of tax		—	—			—		(662)		—		(662)
Balance, March 31, 2021		42,783	$	15		$	449,496	$	(921)	$	(144,535)	$	304,055

See accompanying notes to consolidated financial statements.

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nLIGHT, Inc.

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)


	Three Months Ended March 31,
	2022		2021
Cash flows from operating activities:
Net loss	$	(8,623)	$	(6,149)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation	2,556		2,157
Amortization	1,182		1,560
Reduction in carrying amount of right-of-use assets	867		808
Recoveries of losses on accounts receivable	—		(71)
Stock-based compensation	6,553		8,054
Deferred income taxes	(4)		(11)


Changes in operating assets and liabilities:
Accounts receivable, net	4,690		121
Inventory	(3,433)		(4,405)
Prepaid expenses and other current assets	(5,061)		2,183
Other assets, net	(317)		(428)
Accounts payable	(3,019)		1,437
Accrued and other long-term liabilities	(1,088)		(736)
Deferred revenues	(647)		64
Lease liabilities	(813)		(690)
Non-current income taxes payable	153		221
Net cash provided by (used in) operating activities	(7,004)		4,115
Cash flows from investing activities:
Acquisition of business, net of cash acquired	—		(291)
Purchases of property, plant and equipment	(5,019)		(3,134)
Acquisition of intangible assets and capitalization of patents	(114)		(80)

Net cash used in investing activities	(5,133)		(3,505)
Cash flows from financing activities:
Proceeds from public offerings, net of offering costs	—		82,761

Principal payments on term loan, debt and financing leases	—		(372)




Proceeds from stock option exercises	689		574
Tax payments related to stock award issuances	(78)		(31)
Net cash provided by financing activities	611		82,932
Effect of exchange rate changes on cash	(59)		(227)
Net increase (decrease) in cash, cash equivalents, and restricted cash	(11,585)		83,315
Cash, cash equivalents, and restricted cash, beginning of period	146,784		102,573
Cash, cash equivalents, and restricted cash, end of period	$	135,199	$	185,888
Supplemental disclosures:
Cash paid for interest, net	$	—	$	66
Cash paid for income taxes	79		241
Operating cash outflows from operating leases	1,097		702
Right-of-use assets obtained in exchange for lease liabilities	1,470		6,699
Accrued purchases of property, equipment and patents	2,268		1,698

See accompanying notes to consolidated financial statements.

Table of Contents

nLIGHT, Inc.

Notes to Consolidated Financial Statements

Note 1 - Basis of Presentation and New Accounting Pronouncements

Basis of Presentation

The accompanying unaudited consolidated financial statements of nLIGHT, Inc. and our wholly owned subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). The unaudited financial information reflects, in the opinion of management, all adjustments necessary for a fair presentation of financial position, results of operations, stockholders’ equity, and cash flows for the interim periods presented. The results reported for the interim period presented are not necessarily indicative of results that may be expected for the full year. These consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021.

Critical Accounting Policies

SEC Form 10-Q filed by nLIGHT Inc.