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Owlet(OWLT) - 2024 Q2 - Quarterly Report
OWLTOwlet(OWLT)2024-08-14 20:43
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Financial Performance - Revenues for Q2 2024 reached 20,699,000,a5820,699,000, a 58% increase from 13,088,000 in Q2 2023[17] - Gross profit for the six months ended June 30, 2024, was 16,799,000,comparedto16,799,000, compared to 9,386,000 for the same period in 2023, reflecting a 79% increase[17] - For the six months ended June 30, 2024, Owlet reported a net income of 2,127thousand,asignificantimprovementcomparedtoanetlossof2,127 thousand, a significant improvement compared to a net loss of 20,334 thousand for the same period in 2023[22] - The net loss attributable to common stockholders for Q2 2024 was 2,682,000,comparedtoalossof2,682,000, compared to a loss of 9,793,000 in Q2 2023[17] - The company reported a net income of 2,127thousandforthesixmonthsendedJune30,2024,comparedtoanetlossof2,127 thousand for the six months ended June 30, 2024, compared to a net loss of (22,313) thousand for the same period in 2023[94] - The company recognized a gain of 10.2millionforthesixmonthsendedJune30,2024,comparedtoagainof10.2 million for the six months ended June 30, 2024, compared to a gain of 0.3 million for the same period in the prior year[117] Cash Flow and Liquidity - The company experienced negative cash flows from operations of 6,674thousandforthesixmonthsendedJune30,2024,comparedto6,674 thousand for the six months ended June 30, 2024, compared to 16,757 thousand for the same period in 2023, indicating improved cash management[30] - As of June 30, 2024, Owlet had cash and cash equivalents of 15,363thousand,downfrom15,363 thousand, down from 24,746 thousand at the end of June 2023[22] - The company reported net cash provided by financing activities of 5.6millionforthesixmonthsendedJune30,2024,downfrom5.6 million for the six months ended June 30, 2024, down from 30.3 million in the same period of the previous year[147] - For the six months ended June 30, 2024, net cash used in operating activities was 6.7million,adecreasefrom6.7 million, a decrease from 16.8 million in the prior year, primarily due to a lower operating loss of 8.0millioncomparedto8.0 million compared to 17.7 million[145] Assets and Liabilities - Total current assets increased to 42,530,000asofJune30,2024,upfrom42,530,000 as of June 30, 2024, up from 39,944,000 at the end of 2023[15] - Current liabilities decreased to 42,150,000asofJune30,2024,downfrom42,150,000 as of June 30, 2024, down from 45,090,000 at the end of 2023[15] - Total liabilities decreased to 66,729,000asofJune30,2024,downfrom66,729,000 as of June 30, 2024, down from 73,799,000 at the end of 2023[15] - The company reported a common stock warrant liability of 24,429,000asofJune30,2024,downfrom24,429,000 as of June 30, 2024, down from 27,781,000 at the end of 2023[15] - As of June 30, 2024, the accumulated deficit of Owlet, Inc. was 253,532thousand,reflectingongoingfinancialchallenges[30]OperatingExpenses−TotaloperatingexpensesforthethreemonthsendedJune30,2024,were253,532 thousand, reflecting ongoing financial challenges[30] Operating Expenses - Total operating expenses for the three months ended June 30, 2024, were 12.5 million, compared to 11.9millioninthesameperiodof2023[105]−GeneralandadministrativeexpensesforthethreemonthsendedJune30,2024,were11.9 million in the same period of 2023[105] - General and administrative expenses for the three months ended June 30, 2024, were 6.3 million, a slight increase of 2.7% from 6.1millioninthesameperiodof2023[109]−SalesandmarketingexpensesforthethreemonthsendedJune30,2024,increasedby25.16.1 million in the same period of 2023[109] - Sales and marketing expenses for the three months ended June 30, 2024, increased by 25.1% to 3.9 million from 3.1millioninthesameperiodof2023[111]−Thecompanyreportedanoperatinglossof3.1 million in the same period of 2023[111] - The company reported an operating loss of 2.2 million for the three months ended June 30, 2024, an improvement from an operating loss of 6.7millioninthesameperiodof2023[105]FinancingActivities−Thecompanyraised6.7 million in the same period of 2023[105] Financing Activities - The company raised 9,250 thousand from the issuance of preferred stock and warrants on February 29, 2024, as part of its financing strategy[32] - The company raised aggregate gross proceeds of 30.0millionfromasaleofpreferredstockandwarrantsonFebruary17,2023[134]−ThecompanyenteredintoamendmentswithSVB,deferringcertainprincipalpaymentsandextendingthematurityoftherevolvinglineofcredittoDecember31,2024[135]RegulatoryandCompliance−Thecompanyreceiveditsfirstmedicaldevicemarketingauthorizationwiththe510(k)clearancefromtheFDAforBabySatinJune2023,aprescriptionuse−onlypulseoximeterforpatientsagedoveronemonthandweighingbetween6and30pounds[172]−InNovember2023,thecompanyobtaineddenovoclassificationfromtheFDAforDreamSockwithHealthNotifications,whichisnowregulatedasamedicaldevice[175]−ThecompanyisinvolvedinongoinglitigationrelatedtoclaimsofmisleadingstatementsregardingtheFDA′sclassificationoftheOwletSmartSock,whichcouldhavematerialadverseeffectsonitsfinancialcondition[171]−ThecompanywasnotifiedbyNYSEinApril2023fornon−compliancewithlistingrequirements,specificallyduetoanaverageglobalmarketcapitalizationandstockholders′equitybothbeinglessthan30.0 million from a sale of preferred stock and warrants on February 17, 2023[134] - The company entered into amendments with SVB, deferring certain principal payments and extending the maturity of the revolving line of credit to December 31, 2024[135] Regulatory and Compliance - The company received its first medical device marketing authorization with the 510(k) clearance from the FDA for BabySat in June 2023, a prescription use-only pulse oximeter for patients aged over one month and weighing between 6 and 30 pounds[172] - In November 2023, the company obtained de novo classification from the FDA for Dream Sock with Health Notifications, which is now regulated as a medical device[175] - The company is involved in ongoing litigation related to claims of misleading statements regarding the FDA's classification of the Owlet Smart Sock, which could have material adverse effects on its financial condition[171] - The company was notified by NYSE in April 2023 for non-compliance with listing requirements, specifically due to an average global market capitalization and stockholders' equity both being less than 50 million[182] Internal Controls - The company has identified material weaknesses in internal controls over financial reporting, which could lead to misstatements in financial statements[153] - A remediation plan is in place to address identified weaknesses, including hiring additional personnel and implementing new controls[158]