Identiv Earnings 2020-09-30

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

10-Q 1 inve-10q_20200930.htm Q3'2020 10-Q inve-10q_20200930.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission File Number: 000-29440

IDENTIV, INC.

(Exact Name of Registrant as Specified in its Charter)

DELAWARE	77-0444317
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2201 Walnut Avenue, Suite 100 Fremont, California	94538
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (949) 250-8888

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of exchange on which registered
Common Stock, $0.001 par value per share		INVE		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☑	Smaller reporting company	☑
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of November 10, 2020, the registrant had 18,020,175 shares of common stock outstanding.

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019	3
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2020 and 2019	4
	Condensed Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended September 30, 2020 and 2019	5
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2020 and 2019	7
	Notes to Unaudited Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 6.	Exhibits	40

SIGNATURES		41

PART I: FINANCIAL INFORMATION

Item 1. Financial Statements

IDENTIV, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except par value)

	September 30,			December 31,
	2020			2019
ASSETS
Current assets:
Cash	$	12,294		$	9,383
Accounts receivable, net of allowances of $361 and $299 as of September 30, 2020 and December 31, 2019, respectively		20,389			18,363
Inventories		20,399			16,145
Prepaid expenses and other current assets		3,236			2,292
Total current assets		56,318			46,183
Property and equipment, net		2,392			2,042
Operating lease right-of-use assets		3,463			4,629
Intangible assets, net		8,138			10,104
Goodwill		10,204			10,238
Other assets		1,053			1,122
Total assets	$	81,568		$	74,318
LIABILITIES AND STOCKHOLDERS´ EQUITY
Current liabilities:
Accounts payable	$	9,460		$	8,799
Current portion - contractual payment obligation		950			1,311
Current portion - financial liabilities, net of debt issuance costs of $235 and $41 as of September 30, 2020 and December 31, 2019, respectively		23,758			14,189
Operating lease liabilities		1,957			1,814
Deferred revenue		2,180			2,193
Accrued compensation and related benefits		2,845			1,671
Other accrued expenses and liabilities		2,757			4,498
Total current liabilities		43,907			34,475
Long-term contractual payment obligation		246			360
Long-term operating lease liabilities		2,673			3,013
Long-term deferred revenue		495			640
Other long-term liabilities		381			364
Total liabilities		47,702			38,852
Commitments and contingencies (see Note 17)
Stockholders´ equity:
Series B convertible preferred stock, $0.001 par value: 5,000 shares authorized; 5,000 shares issued and outstanding as of September 30, 2020 and December 31, 2019		5			5
Common stock, $0.001 par value: 50,000 shares authorized; 19,320 and 18,209 shares issued and 17,966 and 16,986 shares outstanding as of September 30, 2020 and December 31, 2019, respectively		19			18
Additional paid-in capital		451,271			447,965
Treasury stock, 1,354 and 1,223 shares as of September 30, 2020 and December 31, 2019, respectively		(9,647	)		(9,043	)
Accumulated deficit		(409,911	)		(405,504	)
Accumulated other comprehensive income		2,129			2,025
Total stockholders´ equity		33,866			35,466
Total liabilities and stockholders' equity	$	81,568		$	74,318

The accompanying notes are an integral part of these condensed consolidated financial statements.

IDENTIV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited, in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
Net revenue	$	24,859		$	23,026		$	62,084		$	64,785
Cost of revenue		14,974			12,500			36,987			35,672
Gross profit		9,885			10,526			25,097			29,113
Operating expenses:
Research and development		2,380			2,125			7,398			6,229
Selling and marketing		4,245			4,470			12,978			13,689
General and administrative		2,118			2,591			6,460			7,492
Increase (decrease) in fair value of earnout liability		—			175			(261	)		175
Restructuring and severance		163			(87	)		1,645			(101	)
Total operating expenses		8,906			9,274			28,220			27,484
Income (loss) from operations		979			1,252			(3,123	)		1,629
Non-operating income (expense):
Interest expense, net		(407	)		(246	)		(1,066	)		(766	)
Foreign currency (losses) gains, net		(175	)		168			(119	)		96
Income (loss) before income tax provision		397			1,174			(4,308	)		959
Income tax provision		(8	)		(105	)		(99	)		(289	)
Net income (loss)	$	389		$	1,069		$	(4,407	)	$	670

Other comprehensive income (loss):
Foreign currency translation adjustment		369			(369	)		104			(302	)
Liquidation of subsidiary with noncontrolling interest		—			(33	)		—			(33	)
Comprehensive income (loss)	$	758		$	667		$	(4,303	)	$	335

Net income (loss) per common share:
Basic	$	0.01		$	0.05		$	(0.29	)	$	(0.01	)
Diluted	$	0.01		$	0.05		$	(0.29	)	$	(0.01	)

Weighted average shares used in computing net income (loss) per common share:
Basic		18,144			17,006			17,868			16,933
Diluted		18,650			17,766			17,868			16,933

The accompanying notes are an integral part of these condensed consolidated financial statements.

IDENTIV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited, in thousands)

	Three Months Ended September 30, 2020
	Series B Convertible Preferred Stock				Common Stock					Additional Paid-in			Treasury			Accumulated			Accumulated Other Comprehensive		Total Stockholders'
	Shares		Amount		Shares			Amount		Capital			Stock			Deficit			Income		Equity
Balances, June 30, 2020		5,000	$	5		17,860		$	19	$	450,480		$	(9,451	)	$	(410,300	)	$	1,760	$	32,513
Net income		—		—		—			—		—			—			389			—		389
Unrealized income from foreign currency translation adjustments		—		—		—			—		—			—			—			369		369
Issuance of common stock in connection with vesting of stock awards		—		—		143			—		—			—			—			—		—
Stock-based compensation		—		—		—			—		791			—			—			—		791
Shares withheld in payment of taxes in connection with net share settlement of restricted stock units		—		—		(37	)		—		—			(196	)		—			—		(196	)
Balances, September 30, 2020		5,000	$	5		17,966		$	19	$	451,271		$	(9,647	)	$	(409,911	)	$	2,129	$	33,866

	Nine Months Ended September 30, 2020
	Series B Convertible Preferred Stock				Common Stock					Additional Paid-in			Treasury			Accumulated			Accumulated Other Comprehensive		Total Stockholders'
	Shares		Amount		Shares			Amount		Capital			Stock			Deficit			Income		Equity
Balances, December 31, 2019		5,000	$	5		16,986		$	18	$	447,965		$	(9,043	)	$	(405,504	)	$	2,025	$	35,466
Net loss		—		—		—			—		—			—			(4,407	)		—		(4,407	)
Unrealized income from foreign currency translation adjustments		—		—		—			—		—			—			—			104		104
Issuance of common stock in connection with vesting of stock awards		—		—		505			—		—			—			—			—		—
Stock-based compensation		—		—		—			—		2,182			—			—			—		2,182
Shares withheld in payment of taxes in connection with net share settlement of restricted stock units		—		—		(131	)		—		—			(604	)		—			—		(604	)
Issuance of common stock in connection with Viscount Earnout		—		—		157			—		489			—			—			—		489
Issuance of shares to non-employees		—		—		62			—		304			—			—			—		304
Issuance of common stock in connection with warrant exercise		—		—		387			1		(1	)		—			—			—		—
Issuance of warrants		—		—		—			—		332			—			—			—		332
Balances, September 30, 2020		5,000	$	5		17,966		$	19	$	451,271		$	(9,647	)	$	(409,911	)	$	2,129	$	33,866

	Three Months Ended September 30, 2019
	Series B Convertible Preferred Stock				Common Stock					Additional Paid-in			Treasury			Accumulated			Accumulated Other Comprehensive			Noncontrolling			Total Stockholders'
	Shares		Amount		Shares			Amount		Capital			Stock			Deficit			Income			Interest			Equity
Balances, June 30, 2019		5,000	$	5		16,786		$	18	$	446,819		$	(8,656	)	$	(404,752	)	$	2,276		$	(170	)	$	35,540
Net income		—		—		—			—		—			—			1,069			—			—			1,069
Unrealized loss from foreign currency translation adjustments		—		—		—			—		—			—			—			(369	)		—			(369	)
Issuance of common stock in connection with vesting of stock awards		—		—		136			—		—			—			—			—			—			—
Stock-based compensation		—		—		—			—		689			—			—			—			—			689
Shares withheld in payment of taxes in connection with net share settlement of restricted stock units		—		—		(39	)		—		—			(185	)		—			—			—			(185	)
Liquidation of subsidiary with noncontrolling interest		—		—		—			—		(137	)		—			—			(33	)		170			—
Balances, September 30, 2019		5,000	$	5		16,883		$	18	$	447,371		$	(8,841	)	$	(403,683	)	$	1,874		$	—		$	36,744

Price	4.93	EPS	0
Shares	18	P/E	131
MCap	88	P/FCF	64
Net Debt	4	EBIT	1
TEV	91	TEV/EBIT	95
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-09-30	Filed 2020-11-13
10-Q	2020-06-30	Filed 2020-08-11
10-Q	2020-03-31	Filed 2020-05-11
10-K	2019-12-31	Filed 2020-03-18
10-Q	2019-09-30	Filed 2019-11-12
10-Q	2019-06-30	Filed 2019-08-14
10-Q	2019-03-31	Filed 2019-05-13
10-K	2018-12-31	Filed 2019-03-15
10-Q	2018-09-30	Filed 2018-11-13
10-Q	2018-06-30	Filed 2018-08-13
10-Q	2018-03-31	Filed 2018-05-15
10-K	2017-12-31	Filed 2018-03-29
10-Q	2017-09-30	Filed 2017-11-13
10-Q	2017-06-30	Filed 2017-08-11
10-Q	2017-03-31	Filed 2017-05-15
10-K	2016-12-31	Filed 2017-03-28
10-Q	2016-09-30	Filed 2016-11-14
10-Q	2016-06-30	Filed 2016-08-15
10-Q	2016-03-31	Filed 2016-05-13
10-K	2015-12-31	Filed 2016-03-31
10-Q	2015-09-30	Filed 2016-03-29
10-Q	2015-06-30	Filed 2016-03-29
10-Q	2015-03-31	Filed 2016-03-29
10-K	2014-12-31	Filed 2015-03-23
10-Q	2014-09-30	Filed 2014-11-14
10-Q	2014-06-30	Filed 2014-08-14
10-Q	2014-03-31	Filed 2014-05-15
10-K	2013-12-31	Filed 2014-03-31
10-Q	2013-09-30	Filed 2013-11-13
10-Q	2013-06-30	Filed 2013-08-14
10-Q	2013-03-31	Filed 2013-05-10
10-K	2012-12-31	Filed 2013-03-19
10-Q	2012-06-30	Filed 2012-08-08
10-Q	2012-03-31	Filed 2012-05-15
10-K	2011-12-31	Filed 2012-03-29
10-Q	2011-09-30	Filed 2011-11-10
10-Q	2011-06-30	Filed 2011-08-05
10-Q	2011-03-31	Filed 2011-05-06
10-K	2010-12-31	Filed 2011-03-07
10-Q	2010-09-30	Filed 2010-11-09
10-Q	2010-06-30	Filed 2010-08-16
10-Q	2010-03-31	Filed 2010-05-17
10-K	2009-12-31	Filed 2010-03-08

8-K	2020-11-10
8-K	2020-10-29
8-K	2020-08-06
8-K	2020-06-01
8-K	2020-05-16
8-K	2020-05-07
8-K	2020-05-05
8-K	2020-04-09
8-K	2020-03-12
8-K	2020-01-28
8-K	2019-11-04
8-K	2019-08-08
8-K	2019-08-05
8-K	2019-05-29
8-K	2019-05-09
8-K	2019-03-07
8-K	2019-02-06
8-K	2019-01-02
8-K	2018-12-19
8-K	2018-11-08
8-K	2018-11-01
8-K	2018-10-25
8-K	2018-08-09
8-K	2018-05-30
8-K	2018-05-10
8-K	2018-03-06
8-K	2018-02-21
8-K	2018-02-14
8-K	2018-02-06
8-K	2018-01-31
8-K	2017-12-28

EX-31.1	inve-ex311_8.htm
EX-31.2	inve-ex312_6.htm
EX-32	inve-ex32_7.htm

INVE 10Q Quarterly Report

Identiv Earnings 2020-09-30