nLIGHT(US:LASR)2025-02-28 19:12Financial Performance - The company has experienced recurring net losses since its inception in 2000, highlighting ongoing financial challenges [61]. - Net loss for 2024 was $60.792 million, compared to a net loss of $41.670 million in 2023, reflecting a 45.9% increase in losses [234]. - Net loss per share for 2024 was $1.27, compared to $0.90 in 2023 [231]. - Comprehensive loss for 2024 was $61.647 million, an increase from $41.399 million in 2023 [234]. - Total revenue for 2024 was $198.548 million, a decrease of 5.5% from $209.921 million in 2023 [231]. - Product revenue declined to $136.659 million in 2024, down 12.8% from $156.666 million in 2023 [231]. - Gross profit for 2024 was $33.019 million, representing a gross margin of 16.6%, compared to $46.113 million and 22.0% in 2023 [231]. - Operating expenses increased to $98.655 million in 2024, up 6.5% from $92.879 million in 2023 [231]. - Cash flows from operating activities resulted in a net cash used of $2.36 million in 2024, a significant decrease from net cash provided of $10.09 million in 2023 [239]. - The company reported a loss before income taxes of $60.87 million in 2024, compared to a loss of $42.65 million in 2023, indicating a worsening of approximately 42.6% [305]. Revenue and Sales - Industrial sales decreased to $45.6 million in 2024 from $71.0 million in 2023, a decline of 35.8% [273]. - Aerospace and Defense sales increased to $109.5 million in 2024, up 19.9% from $91.4 million in 2023 [273]. - The U.S. Government accounted for 19% of total revenues in 2024, up from 18% in 2023 [276]. - North America sales were $132.8 million in 2024, slightly up from $129.3 million in 2023 [273]. Assets and Liabilities - Total assets decreased to $270.2 million in 2024 from $306.8 million in 2023, reflecting a decline of about 11.9% [229]. - Total liabilities increased slightly to $53.8 million in 2024 from $52.4 million in 2023, representing a rise of approximately 2.7% [229]. - The accumulated deficit grew to $325.1 million in 2024, up from $264.3 million in 2023, indicating an increase of about 23% [229]. - The company reported inventory of $40.8 million as of December 31, 2024, down from $52.2 million in 2023, indicating a reduction of approximately 21.2% [223]. - Contract assets increased by 99% to $14.5 million in 2024 from $7.3 million in 2023 [273]. - Contract liabilities increased by 7% to $6.8 million in 2024 from $6.4 million in 2023 [273]. Cash and Investments - As of December 31, 2024, cash and cash equivalents totaled $65.8 million, while marketable securities amounted to $34.9 million [207]. - The company had a net cash provided by investing activities of $16.69 million in 2024, contrasting with a net cash used of $14.10 million in 2023 [239]. - Realized gains from marketable securities were $3.4 million for the year ended December 31, 2024, compared to $2.4 million in 2023 [279]. Research and Development - Research and development expenses were $45.107 million in 2024, slightly down from $46.163 million in 2023 [231]. - Research and development costs are expensed as incurred, reflecting the company's commitment to innovation and product development [257]. Employment and Workforce - Approximately 650 out of nearly 800 full-time employees are based in the United States, indicating a strong domestic workforce [51]. - Labor shortages and turnover can impact operational efficiency and increase labor costs, affecting overall business performance [83]. Market and Competition - The laser industry is facing declining average selling prices, necessitating increased volumes and cost reductions to maintain profitability [60]. - Competition in the industry is intense, with larger competitors having greater resources, which may pressure pricing and market share [42]. - The markets served are characterized by rapid technological change, requiring significant research and development expenditures [57]. Risks and Compliance - The company is subject to risks related to U.S. government contracts, including potential termination and changes in government spending, which could impact financial results [90]. - The company faces risks from international operations, including macroeconomic conditions, regulatory changes, and political instability, particularly in China [93]. - The company is exposed to foreign currency risk, which may adversely affect revenues and operating margins due to fluctuations in exchange rates [95]. - The company must comply with U.S. export controls, and failure to obtain necessary export licenses could harm international revenues [99]. - The company faces significant compliance costs related to privacy, data protection, and information security laws, which could adversely affect its financial condition [111]. Tax and Deferred Tax Assets - The company has estimated U.S. federal net operating loss carryforwards (NOLs) of $169.6 million and state NOLs of $52.9 million as of December 31, 2024 [120]. - The company reported U.S. research and development credit carryforwards of $9.9 million, which will also expire between 2025 and 2044 if not utilized [308]. - The total gross deferred tax assets amounted to $84.403 million, an increase from $75.037 million in 2023, reflecting a growth of 12.4% year-over-year [306]. - The net deferred tax assets increased to $710 thousand in 2024, compared to $89 thousand in 2023, indicating significant improvement in tax asset realizability [306]. - The valuation allowance for deferred tax assets saw increases of $9.0 million in 2024, highlighting ongoing uncertainty regarding the realizability of these assets [307]. Inventory and Fixed Costs - The company has high levels of fixed costs and inventory, which may adversely affect gross profits if product demand declines [65]. - The company recorded an adjustment to inventory values due to excess and obsolete inventory, which was assessed at $40.8 million as of December 31, 2024 [223]. - The product warranty liability decreased from $4.47 million in 2023 to $3.47 million in 2024, a decline of about 22.4% [294]. Other Financial Metrics - The company recorded an adjustment to inventory values due to excess and obsolete inventory, which was assessed at $40.8 million as of December 31, 2024 [223]. - The company performed a quantitative test for goodwill impairment in 2024, concluding that the fair value of reporting units significantly exceeded their carrying values, indicating no impairment [247]. - The total restructuring charges for 2024 amounted to $4.29 million, significantly higher than the $0.82 million recorded in 2023 [303].