Financial Performance - Revenue for fiscal 2022 was $630,428, a decrease of 61.8% from $1,651,765 in fiscal 2021, primarily due to a drop in perpetual license sales of $1,141,323[126] - Gross margin decreased to 44% in fiscal 2022 from 66% in fiscal 2021, attributed to increased component prices and discounted sales[127] - Operating expenses for fiscal 2022 were $9,029,502, a decrease of 5.7% from $9,571,185 in fiscal 2021, mainly due to reduced stock-based compensation[128] - Net loss before preferred dividends increased to $8,692,424 in fiscal 2022 from $7,384,605 in fiscal 2021, reflecting a rise of 17.5%[138] - Cash and working capital as of December 31, 2022, were $2,845,931 and $3,644,522, respectively, down from $11,447,047 and $11,702,358 in 2021[140] - Net cash used in operating activities was $8,212,154 in fiscal 2022, resulting from a net loss and working capital usage[145] - Stock-based compensation decreased by 25.6% to $793,251 in fiscal 2022 from $1,066,455 in fiscal 2021 due to fewer stock options granted[130] - Employee headcount decreased to 25 as of December 31, 2022, from 33 in the previous year, reflecting a shift towards a software-only subscription model[123] - In fiscal 2021, the net cash used in operating activities was $6,298,959, driven by a net loss of $7,384,605 before preferred dividends[146] - Non-cash expenses in fiscal 2021 included stock-based compensation of $1,768,123 and depreciation and amortization of $94,105[146] - Cash generated from working capital was $315,859, primarily due to an increase in accounts payable and accrued expenses of $373,563[146] - In fiscal 2022, net cash used by investing activities was $388,962, an increase from $359,750 in fiscal 2021[147] - The increase in investing activities was attributed to higher patent costs of $47,112[147] - No cash was provided by financing activities in fiscal 2022, compared to $14,404,942 in fiscal 2021[148] - In fiscal 2021, financing activities included net proceeds of $13,268,932 from financings[148] - There are no off-balance sheet arrangements as defined in Item 303(a) of Regulation S-K[149] - Quantitative and qualitative disclosures about market risk are not applicable[150] Business Strategy - Sigma's PrintRite3D integrated hardware and software solution is now offered on a subscription basis, reducing initial costs from over $100,000 to approximately $3,000-$5,000 per month[100] - The company expects the percentage of revenue from OEMs to increase in 2023 and beyond, driven by the availability of software-only products and integration with existing hardware[101] - The company is focusing on building strategic partnerships and expanding its partner ecosystem to enhance customer success and market presence[98] - Sigma has initiated a strategic evaluation of alternatives, including potential investments, acquisitions, or mergers to enhance product and financial synergies[103] - The company aims to simplify the quality experience from up to twelve disparate software licenses to a single integrated user experience[98] - Sigma's technology is printer agnostic and compatible with most leading 3D metal and polymer printers, expanding its market reach[97] - The company is integrating with industry-wide hardware providers, including a recently announced relationship with a laser scanner provider[99] - The company plans to transition to a subscription-based, software-only product offering to enhance commercialization of its PrintRite3D® technology in 2023[144] Operational Challenges - The company continues to face supply chain challenges, including increased lead times for certain hardware components of PrintRite3D[106]
Sigma Additive Solutions(SASI) - 2022 Q4 - Annual Report