quicklo20210405

quicklo20210405_10q.htm

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 July 4, 2021

☐	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: 000-22671

QUICKLOGIC CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

77-0188504

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

2220 Lundy Avenue, San Jose, CA 95131-1816

(Address of principal executive offices including zip code))

(408) 990-4000

(Registrant's telephone number, including area code)

Securities registered pursuant Section 12(b) of the act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $.001 per share	QUIK	The Nasdaq Capital Market

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 definition 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 Securities Exchange Act). Yes ☐ No ☒

As of August 12, 2021, there were 11,541,978 shares of registrant’s common stock, par value $0.001 per share, outstanding.

Table of Contents

QUICKLOGIC CORPORATION

FORM 10-Q

July 4, 2021

TABLE OF CONTENTS

		Page
Part I - Financial Information		3

Item 1.	Unaudited Condensed Consolidated Financial Statements	3

	Consolidated Balance Sheets	3

	Consolidated Statements of Operations	4

	Consolidated Statements of Cash Flows	5

	Consolidated Statements of Changes in Stockholders’ Equity	6

	Notes to Unaudited Condensed Consolidated Financial Statements	7

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33

Item 4.	Controls and Procedures	33

Part II - Other Information		34

Item 1.	Legal Proceedings	34

Item 1A.	Risk Factors	34

Item 6.	Exhibits	35

Signatures		36

Table of Contents

PART I. Financial Information

Item 1. Financial Statements

QUICKLOGIC CORPORATION

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except par value amount)

	*July 4,*			*January 3,*
	*2021*			*2021*
ASSETS
Current assets:
Cash, cash equivalents and restricted cash	$	18,996		$	22,748
Accounts receivable, net of allowances for doubtful accounts of $32 and $0, respectively		2,063			1,688
Inventories		2,205			2,688
Other current assets		984			1,066
Total current assets		24,248			28,190
Property and equipment, net		577			548
Capitalized internal-use software, net		1,135			986
Right of use assets		1,483			1,839
Intangible assets		806			860
Goodwill		185			185
Other assets		280			280
TOTAL ASSETS	$	28,714		$	32,888

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Revolving line of credit	$	15,000		$	15,000
Trade payables		1,316			935
Accrued liabilities		1,606			1,340
Deferred revenue		76			52
Lease liabilities, current		674			685
Total current liabilities		18,672			18,012
Long-term liabilities:
Notes payable, non-current		—			1,192
Lease liabilities, non-current		884			1,197
Other long-term liabilities		189			—
Total liabilities		19,745			20,401
Commitments and contingencies (see Note 11)
Stockholders' equity:
Preferred stock, $0.001 par value; 10,000 shares authorized; no shares issued and outstanding		—			—
Common stock, $0.001 par value; 200,000 authorized; 11,512 and 11,094 shares issued and outstanding as of July 4, 2021 and January 3, 2021, respectively		12			11
Additional paid-in capital		307,117			306,885
Accumulated deficit		(298,160	)		(294,409	)
Total stockholders' equity		8,969			12,487
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	28,714		$	32,888

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

QUICKLOGIC CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

	*Three Months Ended*						*Six Months Ended*
	*July 4,*			*June 28,*			*July 4,*			*June 28,*
	*2021*			*2020*			*2021*			*2020*
Revenue	$	2,882		$	2,196		$	5,122		$	4,354
Cost of revenue		1,416			1,192			2,512			2,235
Gross profit		1,466			1,004			2,610			2,119
Operating expenses:
Research and development		1,652			2,200			3,539			4,019
Selling, general and administrative		1,794			1,665			3,741			3,544
Restructuring costs		—			34			—			513
Total operating expenses		3,446			3,899			7,280			8,076
Loss from operations		(1,980	)		(2,895	)		(4,670	)		(5,957	)
Interest expense		(32	)		(183	)		(64	)		(263	)
Gain on forgiveness of debt		—			—			1,192			—
Interest income and other income (expense), net		(45	)		72			(52	)		67
Loss before income taxes		(2,057	)		(3,006	)		(3,594	)		(6,153	)
Provision for (benefit from) income taxes		5			(27	)		157			(9	)
Net loss	$	(2,062	)	$	(2,979	)	$	(3,751	)	$	(6,144	)
Net loss per share:
Basic and diluted	$	(0.18	)	$	(0.35	)	$	(0.33	)	$	(0.73	)
Weighted average shares outstanding:
Basic and diluted		11,485			8,560			11,374			8,461

Note: Net loss equals comprehensive loss for all periods presented.

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

QUICKLOGIC CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	*Six Months Ended*
	*July 4,*			*June 28,*
	*2021*			*2020*
Cash flows from operating activities:
Net loss	$	(3,751	)	$	(6,144	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		323			490
Stock-based compensation		570			343
Write-down of inventories		229			43
Write-off of equipment		—			4
Gain on forgiveness of debt		(1,192	)		—
Allowance for bad debt		32			—
Changes in operating assets and liabilities:
Accounts receivable		(407	)		867
Inventories		254			165
Other assets		82			425
Trade payables		569			574
Accrued liabilities and deferred revenue		290			(345	)
Other long-term liabilities		189			—
Net cash used in operating activities		(2,812	)		(3,578	)
Cash flows from investing activities:
Capital expenditures for property and equipment		(174	)		(40	)
Capitalized internal-use software		(273	)		(396	)
Net cash used in investing activities		(447	)		(436	)
Cash flows from financing activities:
Payment of finance lease obligations		(156	)		(120	)
Proceeds from paycheck protection program loan		—			1,191
Proceeds from line of credit		30,000			27,000
Repayment of line of credit		(30,000	)		(27,000	)
Proceeds from issuance of common stock, net of issuance costs		148			7,847
Taxes paid related to settlement of equity awards		(485	)		(54	)
Net cash (used in) provided by financing activities		(493	)		8,864
Net (decrease) increase in cash, cash equivalents and restricted cash		(3,752	)		4,850
Cash, cash equivalents and restricted cash at beginning of period		22,748			21,548
Cash, cash equivalents and restricted cash at end of period	$	18,996		$	26,398

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

QUICKLOGIC CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(In thousands)

					*Additional*						*Total*
	*Common Stock*				*Paid-In*			*Accumulated*			*Stockholders'*
	*Shares*		*Amount*		*Capital*			*Deficit*			*Equity*
Balance at January 3, 2021		11,094	$	11	$	306,885		$	(294,409	)	$	12,487
Common stock issued under stock plans and employee stock purchase plan		354		—		(484	)		—			(484	)
Stock-based compensation		—		—		368			—			368
Net loss		—		—		—			(1,689	)		(1,689	)
Balance at April 4, 2021		11,448		11		306,769			(296,098	)		10,682
Common stock issued under stock plans and employee stock purchase plan		64		1		146			—			147
Stock-based compensation		—		—		202			—			202
Net loss		—		—		—			(2,062	)		(2,062	)
Balance at July 4, 2021		11,512	$	12	$	307,117		$	(298,160	)	$	8,969

SEC Form 10-Q filed by QuickLogic Corporation