nLIGHT(LASR) - 2025 Q1 - Quarterly Report

Part I. Financial Information Unaudited Interim Financial Statements Unaudited Q1 2025 financials show a reduced net loss of $8.1 million and asset growth to $290.0 million Consolidated Balance Sheets Total assets increased to $290.0 million, funded by a $20.0 million draw on the company's line of credit Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $215,772 | $194,089 | | Total Assets | $289,996 | $270,241 | | Total Current Liabilities | $37,163 | $34,235 | | Line of credit | $20,000 | $0 | | Total Liabilities | $77,237 | $53,811 | | Total Stockholders' Equity | $212,759 | $216,430 | Consolidated Statements of Operations Revenue grew 16.0% YoY to $51.7 million, driving a near-doubling of gross profit and a smaller net loss Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Total Revenue | $51,668 | $44,527 | | Gross Profit | $13,799 | $7,488 | | Loss from Operations | $(9,610) | $(14,718) | | Net Loss | $(8,093) | $(13,766) | | Net Loss per Share | $(0.16) | $(0.29) | Consolidated Statements of Cash Flows Financing activities provided $18.8 million, leading to a net cash increase of $16.4 million for the quarter Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(20) | $11,375 | | Net cash used in investing activities | $(2,433) | $(1,548) | | Net cash provided by (used in) financing activities | $18,765 | $(1,615) | | Net increase in cash, cash equivalents, and restricted cash | $16,368 | $8,097 | Notes to Consolidated Financial Statements Notes disaggregate revenue, showing strong Aerospace & Defense growth and a $20.0 million credit facility draw Sales by End Market (in thousands) | End Market | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Industrial | $8,856 | $11,985 | | Microfabrication | $10,106 | $10,797 | | Aerospace and Defense | $32,706 | $21,745 | - The U.S. Government accounted for 35% of total revenues in Q1 2025, a significant increase from 19% in Q1 2024[36] - During Q1 2025, the company drew $20.0 million under its revolving line of credit (LOC) to support working capital and general corporate purposes[51] Segment Gross Profit and Margin (in thousands) | Segment | Q1 2025 Gross Profit | Q1 2025 Gross Margin | Q1 2024 Gross Profit | Q1 2024 Gross Margin | | :--- | :--- | :--- | :--- | :--- | | Laser Products | $12,524 | 35.1% | $6,680 | 22.7% | | Advanced Development | $1,845 | 11.5% | $1,349 | 8.9% | Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) Management discusses strong revenue growth from Aerospace & Defense, improved margins, and sufficient liquidity Results of Operations Revenue grew 16.0% to $51.7 million, led by a 50.4% increase in the Aerospace and Defense end market Revenue by End Market and YoY Change (in thousands) | End Market | Q1 2025 | Q1 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Industrial | $8,856 | $11,985 | $(3,129) | (26.1)% | | Microfabrication | $10,106 | $10,797 | $(691) | (6.4)% | | Aerospace and Defense | $32,706 | $21,745 | $10,961 | 50.4% | | Total | $51,668 | $44,527 | $7,141 | 16.0% | - The increase in Laser Products gross margin (to 35.1% from 22.7% YoY) was driven by product sales mix and better absorption of fixed manufacturing costs, while Advanced Development gross margin increased (to 11.5% from 8.9% YoY) due to higher-margin fixed-price contracts[92] - Research and development expenses increased 6.7% YoY to $11.4 million, while Sales, general and administrative expenses increased 4.2% YoY to $12.0 million[93][94] Liquidity and Capital Resources Liquidity remains sufficient, bolstered by a $20.0 million draw on the revolving line of credit - Total cash, cash equivalents, restricted cash, and marketable securities increased by $16.0 million during the quarter to a total of $117.0 million as of March 31, 2025[101] - The principal source of liquidity in Q1 2025 was a $20.0 million draw on the company's line of credit (LOC)[102] Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(20) | $11,375 | | Net cash used in investing activities | $(2,433) | $(1,548) | | Net cash provided by (used in) financing activities | $18,765 | $(1,615) | Quantitative and Qualitative Disclosures About Market Risk Market risk is materially unchanged, except for new interest rate risk from a $20.0 million variable-rate loan - The company's exposure to market risk has not materially changed since December 31, 2024, except for the introduction of interest rate risk from the $20.0 million draw on its variable-rate line of credit[112] - A hypothetical 10% change in interest rates would result in an approximate $0.1 million change in annual obligations under the outstanding loan facility[113] Controls and Procedures Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - Based on an evaluation as of the end of the period, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[114] - There were no material changes in internal control over financial reporting during Q1 2025 that have materially affected, or are reasonably likely to materially affect, internal controls[115] Part II. Other Information Legal Proceedings Current legal proceedings are not expected to materially impact the company's consolidated financial statements - As of March 31, 2025, the company believes that pending legal matters will not have a material adverse effect on its consolidated financial statements[61][118] Risk Factors Risk factors are materially unchanged, with continued focus on international operations and trade policy risks - There have been no material changes to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[119] - The company emphasizes risks related to international operations, including tariffs, trade barriers, and political instability, particularly noting the uncertainty in U.S.-China trade relations[120] Other Information No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading plans during the quarter - During the last fiscal quarter, no director or officer adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement[123] Exhibits This section lists filed exhibits, including Sarbanes-Oxley certifications and XBRL data files - The exhibits filed with the report include certifications from the CEO and CFO as required by the Sarbanes-Oxley Act of 2002, as well as Inline XBRL documents[124]