Restructuring Targets $5 Million of Annual Cost Savings
Everspin Technologies, Inc. (NASDAQ: MRAM), the market leader in MRAM, announced a restructuring plan designed to reduce annual operating expenditures and achieve quarterly cash flow breakeven this year under the existing revenue outlook. Headcount reductions will be enacted January 31, 2020. As a result, Everspin will take a one-time restructuring charge in the fourth quarter of 2019.
The restructuring will result in an approximately 15% reduction of the workforce and is designed to maximize long-term sustainability, operational health and financial controls, while prioritizing the company’s long-term roadmap expansion and associated R&D for MRAM products and technology.
In addition, Jeff Winzeler, who has served Everspin as CFO for the past five years, will step down to pursue other interests, and a search for a replacement is underway. In the interim, Matt Tenorio, Everspin Corporate Controller, will act as interim CFO until a permanent replacement is appointed.
"As a continuation of the cost reduction efforts we initiated last year, today’s restructuring is designed to enable us to accelerate our achievement of cash flow breakeven, while maintaining investments in growing our MRAM product revenue and supporting our customers. Reducing headcount is a difficult action because we value the contributions of every one of our employees. We are grateful for the dedication they have shown toward making our company what it is today," commented Kevin Conley, President and CEO of Everspin. "As a company, our focus remains on continuing to lead the industry in the commercialization of MRAM, and, with today’s actions, better position us to grow our business profitably in the near-term and long-term."
As part of today’s announcement, Everspin also reaffirmed its fourth quarter 2019 revenue guidance of $9.3 million to $9.7 million and expects to release its complete fourth quarter results on March 11, 2020, at which time more information will be provided about the restructuring and impact to GAAP earnings.
About Everspin Technologies
Everspin Technologies, Inc. is the world’s leading provider of Magnetoresistive RAM (MRAM), delivering unprecedented performance, non-volatility, endurance and reliability for applications where data persistence is paramount. Headquartered in Chandler, Arizona, Everspin is transforming the memory market with the largest and most diverse foundation of MRAM customers. For more information, visit www.everspin.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements regarding future events and results that involve risks and uncertainties that could cause actual results or events to differ materially from the expectations disclosed in the forward-looking statement, including, but not limited to: expectations of revenue for the fourth quarter of 2019 are preliminary and adjustments may be made during the audit process; the risks that the costs savings expected from the restructuring may not be as much as expected and Everspin may not achieve profitablility; the anticipated market adoption of Everspin’s products and technology at the rate Everspin expects; the ability for Everspin to expand the markets Everspin addresses at the rate it expects; and the risk that unexpected technical difficulties may develop in the final stages of development or production of its products, or when Everspin’s customers may ship in volume. Readers are advised that they should not place undue reliance on these forward-looking statements and should review the risk factors included in Everspin’s Form 10-Q filed with the Securities and Exchange Commission on November 7, 2019, under the caption "Risk Factors." Subsequent events may cause these expectations to change, and Everspin disclaims any obligations to update or alter these forward-looking statements in the future, whether as a result of new information, future events or otherwise, except as required by law.
Marianne Sabella Dempsey/Joanne Stanway
Leanne K. Sievers, President
Shelton Group Investor Relations