Tigo Energy(TYGO) - 2024 Q1 - Quarterly Results

Executive Summary and Management Commentary Tigo Energy's Q1 2024 reported $9.8 million revenue and a $6.3 million adjusted EBITDA loss, alongside new product launches and break-even targets Management Commentary Tigo Energy's CEO noted Q1 2024 progress in inventory reduction and new product launches, with CFO outlining cash and adjusted EBITDA break-even targets - Meaningful progress in reducing industry-wide inventory overhang challenges persisting since Q2 2023[4] - Introduced TS4-X product family for high-current and high-power panel requirements in C&I and utility markets, with multi-factor rapid shutdown capability[4] - GO ESS products accounted for approximately 14% of Q1 revenues[5] | Metric | Q1 2024 (in millions) | Guidance (Quarterly Revenue, in millions) | | :----- | :-------------------- | :---------------------------------------- | | Revenue | $9.8 | N/A | | Adjusted EBITDA Loss | $6.3 | N/A | | Cash Break-even | N/A | ~$17 - $19 | | Adjusted EBITDA Break-even | N/A | ~$33 - $35 | Recent Financial and Operational Highlights Tigo Energy reported Q1 2024 revenue of $9.8 million, a GAAP gross margin of 28.2%, and an adjusted EBITDA loss of $6.3 million, while shipping 249,000 MLPE units and launching new products | Metric | Q1 2024 (in millions) | | :----- | :-------------------- | | Quarterly Revenue | $9.8 | | GAAP Gross Margin | 28.2% | | GAAP Operating Loss | $9.1 | | GAAP Net Loss | $11.5 | | Adjusted EBITDA Loss | $6.3 | - Shipped 249,000 MLPE units, approximately 100MW DC (assuming an average panel size of 400W)[6] - Launched the TS4-X Family (TS4-X-O, TS4-X-S, and TS4-X-F MLPE) with enhanced safety features, a 25A current rating, and a max power rating of 800W[6] - Introduced the Tigo GO EV Charger residential solar solution for the Italian market[6] First Quarter 2024 Financial Results and Second Quarter 2024 Outlook Tigo Energy's Q1 2024 reported significant revenue decline and net loss, with Q2 2024 revenue projected at $12.0-$16.0 million First Quarter 2024 Financial Results Summary Tigo Energy's Q1 2024 revenue significantly decreased by 80.4% year-over-year to $9.8 million but showed a 6.0% sequential increase, resulting in a net loss of $11.5 million and an adjusted EBITDA loss of $6.3 million | Metric | Q1 2024 (in millions) | Q1 2023 (in millions) | YoY Change | QoQ Change | | :---------------------- | :-------------------- | :-------------------- | :--------- | :--------- | | Revenues | $9.8 | $50.1 | -80.4% | +6.0% | | Gross Profit | $2.8 | $18.4 | -84.9% | N/A | | Gross Margin | 28.2% | 36.7% | -8.5 percentage points | N/A | | Total Operating Expenses | $11.9 | $10.6 | +12.4% | N/A | | Net (Loss) Income | $(11.5) | $6.9 | N/A | N/A | | Adjusted EBITDA (Loss) | $(6.3) | $8.6 | N/A | N/A | - Cash, cash equivalents, and marketable securities totaled $21.9 million at March 31, 2024[12] - Accounts payable decreased $9.7 million to $6.0 million at the end of the first quarter compared to $15.7 million at the beginning of the quarter[12] Second Quarter 2024 Outlook For Q2 2024, Tigo Energy anticipates revenues to be between $12.0 million and $16.0 million, with an expected adjusted EBITDA loss ranging from $5.5 million to $8.0 million | Metric | Q2 2024 Guidance (in millions) | | :----------------- | :----------------------------- | | Revenues | $12.0 - $16.0 | | Adjusted EBITDA Loss | $5.5 - $8.0 | Conference Call Information Tigo management hosted a conference call on May 14, 2024, to discuss Q1 results, with replay information provided Conference Call Details Tigo management hosted a conference call on May 14, 2024, at 4:30 p.m. ET to discuss the Q1 results, with CEO Zvi Alon and CFO Bill Roeschlein - Conference call held on May 14, 2024, at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time)[9] - Hosted by Company CEO Zvi Alon and CFO Bill Roeschlein[9] - Conference call broadcast live and available for replay via the Investor Relations section of Tigo's website[11] About Tigo Energy, Inc. Tigo Energy, founded in 2007, is a global leader in smart hardware and software solutions for solar systems, enhancing safety and energy yield Company Overview Founded in 2007, Tigo is a global leader in smart hardware and software solutions that enhance safety, increase energy yield, and lower operating costs of residential, commercial, and utility-scale solar systems - Founded in 2007, Tigo is a worldwide leader in the development and manufacture of smart hardware and software solutions for solar systems[13] - Solutions enhance safety, increase energy yield, and lower operating costs of residential, commercial, and utility-scale solar systems[13] - Combines Flex MLPE and solar optimizer technology with intelligent, cloud-based software capabilities for advanced energy monitoring and control[13] - Develops and manufactures products such as inverters and battery storage systems for the residential solar-plus-storage market[13] Forward-Looking Statements This section contains forward-looking statements regarding Tigo's future performance, subject to significant business, economic, and competitive uncertainties Forward-Looking Statements Disclaimer This section contains forward-looking statements regarding Tigo's future performance, including break-even points, industry recovery, market penetration, product expansion, and financial results, which are subject to significant business, economic, and competitive uncertainties - Statements include expectations about reaching cash flow and adjusted EBITDA break-even, long-term growth prospects, industry recovery, inventory levels, market penetration, product portfolio expansion, and future financial and operating results[14] - Forward-looking statements are based on current beliefs and expectations but are inherently subject to significant business, economic, and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond control[14] - Factors causing material differences in actual results include ability to develop and sell products, competition, seasonal trends, customer base growth, new product development, demand timing, government subsidies, acquisitions, liquidity, foreign currency fluctuations, political unrest, regulatory changes, personnel retention, and strategic relationships[15] Non-GAAP Financial Measures Tigo Energy uses Adjusted EBITDA as a non-GAAP measure for internal decision-making and performance assessment, with investor relations contacts provided Non-GAAP Financial Measures Definition and Rationale Tigo Energy uses Adjusted EBITDA as a non-GAAP financial measure to supplement GAAP statements, defining it as earnings (loss) before interest, taxes, depreciation, amortization, stock-based compensation, and merger transaction expenses - Adjusted EBITDA is used to supplement consolidated financial statements prepared in accordance with GAAP, not as a substitute[17] - Defined as earnings (loss) before interest and other expenses, net, income tax expense (benefit), depreciation and amortization, as adjusted to exclude stock-based compensation and merger transaction related expenses[18] - Used for financial and operational decision-making, evaluating period-to-period comparisons, and assessing performance by excluding items not indicative of recurring core business operating results[18] - A reconciliation for adjusted EBITDA provided as guidance is not provided due to the high variability, complexity, and difficulty of estimating certain items[21] Investor Relations Contacts Investor relations inquiries can be directed to Matt Glover or Chris Adusei-Poku at Gateway Group, Inc - Investor Relations Contacts: Matt Glover or Chris Adusei-Poku at Gateway Group, Inc[22] - Contact information: (949) 574-3860, TYGO@gateway-grp.com[22] Condensed Consolidated Financial Statements Tigo Energy's Q1 2024 financial statements show total assets of $109.1 million, a net loss of $11.5 million, and $11.3 million cash used in operations Condensed Consolidated Balance Sheets As of March 31, 2024, Tigo Energy reported total assets of $109.1 million, down from $127.8 million at December 31, 2023, with total liabilities decreasing to $54.8 million and stockholders' equity at $54.3 million | Metric | March 31, 2024 (in thousands) | December 31, 2023 (in thousands) | Change (in thousands) | | :-------------------------------- | :------------------------------ | :------------------------------- | :-------------------- | | Total Assets | $109,121 | $127,777 | $(18,656) | | Current Assets | $88,396 | $104,710 | $(16,314) | | Cash and cash equivalents | $9,025 | $4,405 | $4,620 | | Marketable securities, short-term | $12,920 | $26,806 | $(13,886) | | Inventory, net | $55,757 | $61,401 | $(5,644) | | Total Liabilities | $54,797 | $64,953 | $(10,156) | | Accounts payable | $6,030 | $15,685 | $(9,655) | | Total Stockholders' Equity | $54,324 | $62,824 | $(8,500) | Condensed Consolidated Statement of Operations For Q1 2024, Tigo Energy's net revenue was $9.8 million, a substantial decrease from $50.1 million in Q1 2023, leading to a gross profit of $2.8 million and a net loss of $11.5 million | Metric | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | YoY Change | | :--------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :--------- | | Net revenue | $9,802 | $50,058 | -80.4% | | Cost of revenue | $7,036 | $31,689 | -77.8% | | Gross profit | $2,766 | $18,369 | -84.9% | | Gross margin | 28.2% | 36.7% | -8.5 percentage points | | Total operating expenses | $11,854 | $10,549 | +12.4% | | (Loss) income from operations | $(9,088) | $7,820 | N/A | | Net (loss) income | $(11,506) | $6,910 | N/A | | (Loss) earnings per common share (Diluted) | $(0.19) | $0.05 | N/A | Condensed Consolidated Statements of Cash Flows In Q1 2024, Tigo Energy reported net cash used in operating activities of $11.3 million, with investing activities generating $15.6 million and financing activities providing $0.3 million, resulting in a $4.6 million increase in cash and cash equivalents | Cash Flow Activity | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | | :-------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net cash used in operating activities | $(11,266) | $(5,087) | | Net cash provided (used) by investing activities | $15,636 | $(10,655) | | Net cash provided by financing activities | $250 | $28,631 | | Net increase in cash and cash equivalents | $4,620 | $12,889 | | Cash and cash equivalents at end of period | $9,025 | $50,606 | - Investing activities in Q1 2024 were primarily driven by sales and maturities of marketable securities ($16.0 million)[28] - Financing activities in Q1 2023 included $50.0 million from Convertible Promissory Note proceeds, which was not present in Q1 2024[28] Reconciliation of Net (Loss) Income (GAAP) to Adjusted EBITDA (Non-GAAP) For Q1 2024, Tigo Energy reported a GAAP net loss of $11.5 million, which reconciles to an Adjusted EBITDA loss of $6.3 million after specific adjustments, contrasting with Q1 2023's net income and positive Adjusted EBITDA | Metric | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | | :-------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net (loss) income (GAAP) | $(11,506) | $6,910 | | Adjustments: | | | | Total other expenses, net | $2,418 | $910 | | Depreciation and amortization | $310 | $242 | | Stock-based compensation | $2,505 | $366 | | M&A transaction expenses | — | $133 | | Adjusted EBITDA (Non-GAAP) | $(6,273) | $8,561 |