Financial Performance - Total revenues for Q2 2023 were $32.123 million, a decrease of 31.6% compared to $46.945 million in Q2 2022[15] - Gross profit for Q2 2023 was $6.733 million, down 64.3% from $18.828 million in Q2 2022[15] - Net loss for Q2 2023 was $33.607 million, compared to a net loss of $21.017 million in Q2 2022, representing a 59.9% increase in losses[15] - For the six months ended June 30, 2023, the company reported a net loss of $54.5 million, compared to a net loss of $50.8 million for the same period in 2022, reflecting an increase in losses of approximately 3.7%[19] - The company reported a net loss of $33.6 million for the three months ended, compared to a net loss of $21.0 million for the same period in 2022, representing a 60.5% increase in losses year-over-year[113] - The net loss per share for the three months ended June 30, 2023, was $(0.45), compared to $(0.29) for the same period in 2022, reflecting a 55.2% increase in losses per share[113] Expenses - Research and development expenses for Q2 2023 were $13.416 million, a decrease of 19.8% from $16.720 million in Q2 2022[15] - Operating expenses for Q2 2023 totaled $27.495 million, down 26.0% from $37.103 million in Q2 2022[15] - The company incurred a share-based compensation expense of $3.9 million for the six months ended June 30, 2023, compared to $13.5 million for the same period in 2022, indicating a decrease of approximately 71.1%[19] - The company recorded a $1.7 million reduction in convertible debt and an increase in additional paid-in capital due to the issuance of 5,912,040 warrants under the Fortress Credit Agreement[103] Assets and Liabilities - Total current assets decreased to $75.030 million as of June 30, 2023, from $89.697 million as of December 31, 2022, a decline of 16.5%[14] - Total liabilities increased to $238.174 million as of June 30, 2023, compared to $205.894 million as of December 31, 2022, an increase of 15.6%[14] - The company reported a total accumulated deficit of $905.7 million as of June 30, 2023, compared to $872.1 million as of March 31, 2023, reflecting an increase of approximately 3.8%[19] - As of June 30, 2023, the company had $75.0 million in current assets and $78.0 million in current liabilities, resulting in a current ratio of approximately 0.96[33] Cash Flow - The company had total cash, cash equivalents, and restricted cash of $10.1 million as of June 30, 2023, down from $36.4 million at the end of June 2022, indicating a decrease of approximately 72.2% year-over-year[20] - Cash used in operating activities for the six months ended June 30, 2023, was $12.2 million, an improvement from $22.5 million used in the same period in 2022, representing a reduction of approximately 45.5%[19] - The company experienced a net cash increase of $2.9 million in cash, cash equivalents, and restricted cash during the six months ended June 30, 2023, compared to a decrease of $26.8 million in the same period in 2022[19] Business Operations - The company is heavily investing in 5G research and development and expects to continue using cash from operations throughout the remainder of 2023 and into the first half of 2024[33] - The company sold its Mimosa business for approximately $60.0 million as part of its strategy to improve financial results[34] - The company is focusing on expanding sales in additional geographic markets and developing 5G product offerings to enhance market reach[34] - The company implemented a restructuring program in Q2 2023, incurring total restructuring costs of $3.0 million for the three months ended June 30, 2023[46] Inventory and Receivables - The company reported a significant reduction in accounts receivable, which fell to $22.790 million from $46.565 million, a decrease of 51.1%[14] - An inventory impairment charge of $7.2 million was recorded in the three months ended June 30, 2023, due to product initiatives being eliminated or reduced[46] Debt and Financing - The company had subordinated debt outstanding of $9,000,000 and accrued interest of $2,400,000 as of June 30, 2023, compared to $2,100,000 as of December 31, 2022[59] - The subordinated term loan outstanding was $30,000,000 with accrued interest of $13,400,000 as of June 30, 2023, up from $11,500,000 as of December 31, 2022[62] - The Fortress Credit Agreement includes a total loan commitment of $34,000,000, with a maturity date of December 30, 2024[65] - The interest rates under the Fortress Credit Agreement were increased to 5.5% plus SOFR, with a maximum of 8.5% for paid-in-kind interest[64] - The company recorded a loss on debt extinguishment of $5,100,000 related to the senior term loan as part of the May 2023 Credit Agreement Amendment[64] Compliance and Covenants - As of June 30, 2023, the Company was in compliance with all applicable covenants under the Fortress Credit Agreement after previous breaches were waived[71] - The Company was not in compliance with the minimum last twelve-month EBITDA and revenue covenants as of March 31, 2023, leading to events of default[68] - The minimum liquidity requirement under the Fortress Credit Agreement was decreased to $2.0 million, increasing to $4.0 million after the closing date[69] Stock and Warrants - The weighted average shares outstanding for basic and diluted earnings per share was 74,582,992 for Q2 2023, compared to 72,335,952 for Q2 2022[15] - The company had 7,766,234 Common Stock options outstanding as of June 30, 2023, with a weighted average exercise price of $3.70[107] - The company reported a total of 27,057,040 warrants outstanding as of June 30, 2023, compared to 21,145,000 in 2022, indicating an increase in potential dilution[114] - As of June 30, 2023, there were 12,045,000 Common Stock Warrants outstanding, including 11,500,000 Public Warrants and 545,000 Private Placement Warrants[96] Related Party Transactions - The company derived approximately $41,000 in revenue from a related party for the six months ended June 30, 2023, compared to $0 for the three months ended[116] - The company had an outstanding accounts receivable from a related party amounting to $11.7 million as of June 30, 2023, up from $4.5 million as of December 31, 2022[118]
Airspan Networks (MIMO) - 2023 Q2 - Quarterly Report