Microvast Holdings Inc Reports Substantial Year-Over-Year Growth in Q3 2023
Microvast Holdings Inc (NASDAQ:MVST) announces a 107.5% increase in revenue to $80.1 million in Q3 2023.
Gross margin improves significantly from 5.2% to 22.3% year over year.
Record backlog of $678.7 million, marking a 382.7% increase from the previous year.
Net loss narrows to $26.2 million from $36.5 million in Q3 2022.
On November 9, 2023, Microvast Holdings Inc (NASDAQ:MVST), a leading innovator in lithium-ion battery solutions, released its unaudited financial results for the third quarter ended September 30, 2023. The company reported a remarkable year-over-year revenue increase of 107.5%, reaching $80.1 million, and a significant improvement in gross margin, which rose by 17.1 percentage points to 22.3%.
Financial Highlights and Operational Achievements
Microvast's Founder, Chairman, and CEO, Yang Wu, attributed the impressive revenue growth to increased deliveries from their new Huzhou 3.1 line. The company's CFO, Craig Webster, noted the adjusted gross margin reached 24.2%, putting Microvast on par with scaled global battery manufacturers. The company's backlog as of September 30, 2023, stood at a record $678.7 million, a 382.7% increase year over year, signaling strong future revenue potential.
Operating expenses for Q3 2023 were $44.7 million, up from $39.6 million in the same quarter last year. Despite this increase, the company managed to reduce its net loss to $26.2 million from $36.5 million in Q3 2022. The net loss per share improved to $0.08, compared to $0.12 in the prior-year period.
Balance Sheet and Cash Flow
Microvast's balance sheet reflects a cash and cash equivalents position of $67.4 million as of September 30, 2023, down from $231.4 million at the end of 2022. This decrease is largely attributed to significant capital expenditures towards property, plant, and equipment (PP&E) in the U.S. and Huzhou, China. Capital expenditures for the quarter amounted to $59.9 million, primarily driven by capacity expansion at the Clarksville, Tennessee facility.
The company's total assets increased slightly to $1.016 billion, while total liabilities also rose to $449.2 million. Shareholders' equity experienced a decrease, standing at $567.3 million, compared to $612.9 million at the end of 2022.
Outlook for 2023
Looking ahead, Microvast anticipates adding major projects to its record backlog and expects revenue to be in the range of $90 million to $100 million for Q4 2023. For the full year, the company projects revenues between $292 million and $302 million, compared to $204 million in 2022. The company also plans to continue ramping up deliveries of 53.5Ah cells from Huzhou, China, and to complete construction and equipment installation in Clarksville, Tennessee, with ramp-up beginning in Q1 2024.
Microvast's management will host a conference call and webcast to discuss the financial results, providing an opportunity for investors to gain further insights into the company's performance and strategies.
For detailed financial tables and reconciliations of GAAP to non-GAAP measures, please refer to the original earnings release. These tables provide a clear breakdown of the adjustments made to arrive at non-GAAP figures, offering a comprehensive view of the company's financial health.
Microvast's commitment to innovation and excellence in the electric vehicle battery market continues to drive its financial success, positioning the company for sustained growth in the burgeoning EV industry.
Explore the complete 8-K earnings release (here) from Microvast Holdings Inc for further details.
This article first appeared on GuruFocus.
