Netlist Inc (NLST) Reports Mixed Annual and Q4 Results for 2023
Q4 Revenue Increase: Netlist Inc (NLST) reported a rise in Q4 revenue to $33.4 million from $21.7 million in the same quarter last year.
Annual Revenue Decline: Full-year revenue decreased to $69.2 million from $161.6 million in the previous year.
Gross Profit: Gross profit for Q4 was $1.2 million, down from $1.6 million in Q4 of the prior year. Annual gross profit also fell to $2.4 million from $11.9 million.
Net Loss: Netlist experienced a net loss of ($13.2) million in Q4 and ($60.4) million for the full year.
Cash Position: As of December 30, 2023, the company had $52.8 million in cash, cash equivalents, and restricted cash.
Stock-Based Compensation: Included in the results is stock-based compensation expense of $0.9 million for Q4 and $4.3 million for the full year.
On February 13, 2024, Netlist Inc (NLST) released its 8-K filing, detailing the financial outcomes for both the fourth quarter and the full year of 2023. The company, known for its innovative memory and storage solutions, including Storage class memory, nonvolatile memory, specialty DIMMs, and embedded flash, faced a year of contrasts with a strong fourth quarter overshadowed by a yearly decline in revenue and gross profit.
Netlist's CEO, C.K. Hong, expressed optimism about the company's trajectory, citing significant investments in intellectual property and upcoming trials against Micron and Samsung as potential growth drivers. Despite the positive outlook, the full-year figures presented a more challenging scenario, with a stark decrease in net sales from the previous year and a drop in gross profit. The company's net loss also widened, from ($33.4) million in the previous year to ($60.4) million in 2023.
However, the fourth quarter showed signs of recovery, with net sales increasing significantly compared to the same period in the previous year. This uptick in revenue, according to Hong, positions Netlist for continued growth in 2024. The company's balance sheet reflects a solid cash position, with total assets amounting to $72.8 million and stockholders equity at $23.8 million as of the end of 2023.
Financial Tables Overview
The financial tables included in the earnings report provide a detailed breakdown of Netlist's financial position. The condensed consolidated balance sheets show a slight increase in total assets from $67.3 million in 2022 to $72.8 million in 2023. The company's cash and cash equivalents rose to $40.4 million, up from $25 million the previous year, indicating a stronger liquidity position.
The condensed consolidated statements of operations reveal the challenges faced by the company, with cost of sales closely trailing net sales, leading to reduced gross profits. Operating expenses, particularly intellectual property legal fees, saw a significant increase, which contributed to the overall net loss. Stock-based compensation expenses were also higher in 2023 compared to the previous year.
Netlist's performance in 2023 reflects the volatile nature of the semiconductor industry, where innovation and intellectual property play critical roles in shaping a company's success. The increase in Q4 revenue suggests potential for recovery, while the annual figures highlight the ongoing challenges the company must navigate. Investors and industry observers will be closely watching Netlist's strategic moves in 2024, particularly the outcomes of its legal battles and its ability to capitalize on its intellectual property investments.
For more detailed information and to participate in the investor conference call, stakeholders are encouraged to visit the Investors section of Netlist's website at www.netlist.com.
As Netlist Inc (NLST) continues to innovate and defend its intellectual property, the company's financial health and strategic decisions will be crucial in determining its position within the competitive landscape of memory and storage solutions.
Explore the complete 8-K earnings release (here) from Netlist Inc for further details.
This article first appeared on GuruFocus.
