indie Semiconductor(INDI) - 2025 Q2 - Quarterly Report

Part I. Financial Information Condensed Consolidated Financial Statements This section presents the unaudited condensed consolidated financial statements, showing a Q2 revenue decrease to $51.6 million, a widened net loss of $41.6 million, and reduced total assets to $867.6 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $192,560 | $274,248 | | Total current assets | $331,760 | $408,748 | | Total assets | $867,630 | $941,386 | | Liabilities & Equity | | | | Total current liabilities | $76,481 | $84,880 | | Long-term debt, net | $338,226 | $369,097 | | Total liabilities | $452,534 | $495,991 | | Total stockholders' equity | $415,096 | $445,395 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $51,634 | $52,355 | $105,711 | $104,708 | | Loss from operations | $(42,993) | $(36,634) | $(81,926) | $(86,281) | | Net loss | $(41,618) | $(21,000) | $(78,789) | $(55,223) | | Net loss attributable to indie | $(39,038) | $(19,160) | $(73,584) | $(50,339) | | Net loss per share — basic & diluted | $(0.20) | $(0.11) | $(0.38) | $(0.30) | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(36,606) | $(29,073) | | Net cash used in investing activities | $(8,392) | $(9,179) | | Net cash provided by (used in) financing activities | $(34,008) | $6,558 | | Net decrease in cash and cash equivalents | $(81,695) | $(29,031) | Notes to Unaudited Condensed Consolidated Financial Statements Detailed notes disclose a $7.1 million restructuring plan, significant debt, contingent consideration settlements, and the planned acquisition of emotion3D GmbH - On May 12, 2025, the company initiated a restructuring plan to improve operational efficiencies and reduce costs, resulting in total charges of $7.1 million in Q2 2025. These charges primarily consist of personnel costs ($3.7 million) and long-lived asset impairment ($3.3 million)[41][42] - In June 2025, the company repurchased $30 million in principal of its 2027 Convertible Notes at a discount, resulting in a pre-tax gain on debt extinguishment of $2.6 million[70] Revenue by Geography (in thousands) | Region | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Greater China | $41,747 | $45,354 | | Europe | $23,784 | $18,386 | | United States | $16,747 | $18,820 | | Rest of Asia Pacific | $12,366 | $10,337 | | South Korea | $7,971 | $7,551 | | Other | $3,096 | $4,260 | - Subsequent to the quarter end, on August 6, 2025, the company entered into an agreement to acquire emotion3D GmbH for an aggregate consideration of up to $30 million, consisting of $20 million in cash at closing and up to $10 million in contingent earnout payments[119][120] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q2 revenue decline, increased operating expenses due to restructuring, and a strong liquidity position of $202.9 million despite increased cash usage - The company is impacted by macroeconomic conditions including inflation, geopolitical tensions, and trade policies (tariffs), which can affect economic activity and consumer demand for automotive products[125] - As of June 30, 2025, the company had $202.9 million in cash, cash equivalents, and restricted cash. Management believes current liquidity is sufficient to meet needs for at least the next 12 months[151][158] Operating Results: Q2 2025 vs. Q2 2024 Q2 2025 total revenue decreased 1% to $51.6 million, while operating expenses rose 6% to $94.6 million due to a $7.1 million restructuring charge Q2 Revenue Comparison (in thousands) | Revenue Type | Q2 2025 | Q2 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Product revenue | $49,720 | $49,009 | $711 | 1% | | Contract revenue | $1,914 | $3,346 | $(1,432) | (43)% | | Total revenue | $51,634 | $52,355 | $(721) | (1)% | Q2 Operating Expenses Comparison (in thousands) | Expense Category | Q2 2025 | Q2 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Cost of goods sold | $30,693 | $30,241 | $452 | 1% | | Research and development | $38,472 | $41,301 | $(2,829) | (7)% | | Selling, general, and administrative | $18,355 | $17,447 | $908 | 5% | | Restructuring costs | $7,107 | $— | $7,107 | 100% | | Total operating expenses | $94,627 | $88,989 | $5,638 | 6% | Operating Results: Six Months 2025 vs. 2024 H1 2025 total revenue increased 1% to $105.7 million, while operating expenses decreased 2% to $187.6 million, offsetting restructuring costs Six Months Revenue Comparison (in thousands) | Revenue Type | H1 2025 | H1 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Product revenue | $100,140 | $97,587 | $2,553 | 3% | | Contract revenue | $5,571 | $7,121 | $(1,550) | (22)% | | Total revenue | $105,711 | $104,708 | $1,003 | 1% | Six Months Operating Expenses Comparison (in thousands) | Expense Category | H1 2025 | H1 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Cost of goods sold | $62,221 | $60,330 | $1,891 | 3% | | Research and development | $80,587 | $90,890 | $(10,303) | (11)% | | Selling, general, and administrative | $37,722 | $39,769 | $(2,047) | (5)% | | Restructuring costs | $7,107 | $— | $7,107 | 100% | | Total operating expenses | $187,637 | $190,989 | $(3,352) | (2)% | Liquidity and Capital Resources Cash decreased to $202.9 million, with H1 cash used in operations increasing to $36.6 million and financing activities shifting to a $34.0 million outflow Summary of Cash Flows (in thousands) | Cash Flow Activity | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(36,606) | $(29,073) | | Net cash used in investing activities | $(8,392) | $(9,179) | | Net cash (used in) provided by financing activities | $(34,008) | $6,558 | - Financing activities in H1 2025 included $27.7 million in payments on debt obligations and the repurchase of 2027 Notes, and $3.7 million in payments on financed software[163] Quantitative and Qualitative Disclosures About Market Risk The company faces foreign currency risk from international operations, mitigated by forward contracts, and minimal interest rate risk on its $202.9 million cash portfolio - The company's primary foreign currency exposures are the Canadian dollar, Chinese yuan/renminbi, Euro, British pound sterling and Israeli New Shekel[169] - To mitigate currency risk, the company enters into foreign currency forward contracts. The change in fair value of these contracts was a primary driver of foreign exchange gains in Q2 2025 versus losses in Q2 2024[169] Controls and Procedures Management concluded disclosure controls were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[173] - There were no changes in internal control over financial reporting during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, internal controls[177] Part II. Other Information Legal Proceedings The company is not a party to any material legal proceedings, only routine claims incidental to ordinary business - The company is not party to any material legal proceedings[179] Risk Factors No material changes have occurred to the company's risk factors since the 2024 Annual Report on Form 10-K - No material changes have been made to the risk factors previously disclosed in the company's 2024 Form 10-K[180] Other Information Key executives, the COO and CEO, have adopted Rule 10b5-1 trading plans for future stock sales - On May 26, 2025, COO Michael Wittmann adopted a Rule 10b5-1 trading plan for the sale of up to 344,472 shares of Class A common stock[184] - On June 13, 2025, CEO Donald McClymont adopted a Rule 10b5-1 trading plan for the sale of up to 1,550,000 shares of Class A common stock[185] Exhibits This section lists exhibits filed with Form 10-Q, including transaction agreements, governance documents, and officer certifications