IRADIMED CORP [IRMD] Filings

10-Q 1 irmd-20230630x10q.htm 10-Q

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒

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

For the Quarterly Period Ended June 30, 2023

☐

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

For the transition period from to

Commission File No.: 001-36534

IRADIMED CORPORATION

(Exact name of Registrant as specified in its charter)


Delaware		73-1408526
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

1025 Willa Springs Drive Winter Springs, Florida		32708
(Address of principal executive offices)		(Zip Code)

(407) 677-8022

(Registrant’s telephone number, including area code)

N/A

(Former Name, former address and former fiscal year, if changed since last report)

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


Title of each class:	Trading Symbol	Name of each exchange on which registered:
Common stock, par value $0.0001	IRMD	NASDAQ Capital Market

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 or a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company,” and “emerging growth company” as defined 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. Yes ☐ No ☐

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

The registrant had 12,602,673 shares of common stock, par value $0.0001 per share, outstanding as of July 31, 2023.

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IRADIMED CORPORATION

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			Page
Cautionary Note Regarding Forward-Looking Statements			3

Part I	Financial Information		5

	Item 1	Condensed Financial Statements	5

		(a) Condensed Balance Sheets as of June 30, 2023 (Unaudited) and December 31, 2022	5

		(b) Condensed Statements of Operations for the Three and Six Months Ended June 30, 2023 and 2022 (Unaudited)	6

		(c) Condensed Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2023 and 2022 (Unaudited)	7

		(d) Condensed Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2023 and 2022 (Unaudited)	8

		(e) Condensed Statements of Cash Flows for the Six Months Ended June 30, 2023 and 2022 (Unaudited)	9

		(f) Notes to Unaudited Condensed Financial Statements	10

	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19

	Item 3	Quantitative and Qualitative Disclosures About Market Risk	25

	Item 4	Controls and Procedures	25

Part II	Other Information		27

	Item 1	Legal Proceedings	27

	Item 1A	Risk Factors	27

	Item 2	Unregistered Sale of Equity Securities and Use of Proceeds	27

	Item 3	Default Upon Senior Securities	27

	Item 4	Mine Safety Disclosures	27

	Item 5	Other Information	27

	Item 6	Exhibits	28

Signatures			29

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CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains “forward-looking statements” that involve substantial risks and uncertainties. The forward-looking statements are contained principally in the sections entitled “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements relate to future events or our future financial performance or condition and involve known and unknown risks, uncertainties and other factors that could cause our actual results, levels of activity, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. These forward-looking statements include, but are not limited to, statements about:

●

our ability to receive 510(k) clearance for our products and product candidates, complete inspections conducted by the U.S. Food & Drug Administration (“FDA”) or other regulatory bodies resulting in favorable outcomes, additional actions by or requests from the FDA, including a request to cease domestic distribution of products, or other regulatory bodies and unanticipated costs or delays associated with the resolution of these matters;

●

the timing and likelihood of regulatory approvals or clearances from the FDA or other regulatory bodies and regulatory actions on our product candidates and product marketing activities;

●

unexpected costs, expenses and diversion of management attention resulting from actions or requests posed to us by the FDA or other regulatory bodies;

●

our primary reliance on a limited number of products;

●

our ability to retain the continued service of our key professionals and to identify, hire and retain additional qualified professionals;

●

market and economic uncertainty caused by any or all public health concerns such as pandemics;

●

our expectations regarding the sales and marketing of our products, product candidates and services;

●

our expectations regarding the integrity of our supply chain for our products;

●

the potential for adverse application of environmental, climate change, health and safety and other laws and regulations of any jurisdiction on our operations;

●

our expectations for market acceptance of our new products;

●

the potential for our marketed products to be withdrawn due to recalls, patient adverse events or deaths;

●

our ability to establish and maintain intellectual property on our products and our ability to successfully defend these in cases of infringement;

●

the implementation of our business strategies;

●

the potential for exposure to product liability claims;

●

our financial performance expectations and interpretations thereof by securities analysts and investors;

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●

our ability to compete in the development and marketing of our products and product candidates with other companies in our industry;

●

difficulties or delays in the development, production, manufacturing and marketing of new or existing products and services, including difficulties or delays associated with obtaining requisite regulatory approvals or clearances associated with those activities;

●

changes in laws and regulations or in the interpretation or application of laws or regulations, as well as possible failures to comply with applicable laws or regulations as a result of possible misinterpretations or misapplications;

●

cost-containment efforts of our customers, purchasing groups, third-party payers and governmental organizations;

●

costs associated with protecting our trade secrets and enforcing our patent, copyright and trademark rights, and successful challenges to the validity of our patents, copyrights or trademarks;

●

actions of regulatory bodies and other government authorities, including the FDA and foreign counterparts, that could delay, limit or suspend product development, manufacturing or sales or result in recalls, seizures, consent decrees, injunctions and monetary sanctions; including carbon taxes;

●

costs or claims resulting from potential errors or defects in our manufacturing that may injure persons or damage property or operations, including costs from remediation efforts or recalls;

●

the results, consequences, effects or timing of any commercial disputes, patent infringement claims or other legal proceedings or any government investigations;

●

interruption in our ability to manufacture our products or an inability to obtain key components or raw materials or increased costs in such key components or raw materials;

●

uncertainties in our industry due to the effects of government-driven or mandated healthcare reform;

●

competitive pressures in the markets in which we operate;

●

the loss of, or default by, one or more key customers or suppliers; and

●

unfavorable changes to the terms of key customer or supplier relationships.

●

pandemic-related uncertainties may potentially affect our financial position, operations, and cash flows. We are actively managing our response, but the extent of future impact remains uncertain.

Forward-looking statements are not guarantees of future performance and are subject to substantial risks and uncertainties that could cause the actual results to differ materially from those that we predicted in the forward-looking statements. Investors should carefully review the information contained under the caption “Risk Factors” contained in Item 1A for a description of risks and uncertainties that could cause actual results to differ from those that we predicted. All forward-looking statements are based on information available to us on the date hereof, and we assume no obligation to update forward-looking statements, except as required by Federal Securities laws.

Unless expressly indicated or the context requires otherwise, references in this Quarterly Report to “IRADIMED,” the “Company,” “we,” “our,” and “us” refer to IRADIMED CORPORATION.

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PART I. FINANCIAL INFORMATION

Item 1. Condensed Financial Statements

IRADIMED CORPORATION

CONDENSED BALANCE SHEETS


	June 30,		December 31,
	2023		2022
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	45,822,834	$	57,960,864
Accounts receivable, net of allowance for doubtful accounts of $331,403 as of June 30, 2023, and $160,498 as of December 31, 2022		11,082,213		13,274,521
Inventory, net		8,415,080		5,369,233
Prepaid expenses and other current assets		770,647		630,960
Prepaid income taxes		—		254,093
Total current assets		66,090,774		77,489,671
Property and equipment, net		8,720,273		2,399,812
Intangible assets, net		2,353,773		2,069,439
Operating lease right-of-use asset		2,247,667		2,205,286
Deferred tax asset, net		1,766,383		700,867
Other assets		252,161		648,672
Total assets	$	81,431,031	$	85,513,747
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	2,552,076	$	1,799,316
Accrued payroll and benefits		2,332,643		2,871,890
Other accrued taxes		217,496		121,919
Warranty reserve		105,479		94,030
Deferred revenue		1,714,067		3,373,122
Current portion of operating lease liabilities		413,745		293,466
Other current liabilities		250,000		—
Total current liabilities		7,585,506		8,553,743
Deferred revenue		3,013,165		1,375,197
Operating lease liabilities, less current portion		1,833,922		1,911,820
Total liabilities		12,432,593		11,840,760
Stockholders’ equity:
Common stock; $0.0001 par value; 31,500,000 shares authorized; 12,601,541 shares issued and outstanding as of June 30, 2023, and 12,591,004 shares issued and outstanding as of December 31, 2022		1,260		1,259
Additional paid-in capital		27,369,898		26,407,446
Retained earnings		41,627,280		47,264,282
Total Stockholders' Equity		68,998,438		73,672,987
Total liabilities and stockholders’ equity	$	81,431,031	$	85,513,747

See accompanying notes to unaudited condensed financial statements.

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IRADIMED CORPORATION

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)


	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Revenue	$	16,130,396	$	12,721,569	$	31,605,480	$	25,032,279
Cost of revenue		3,943,904		2,581,806		7,697,535		5,512,992
Gross profit		12,186,492		10,139,763		23,907,945		19,519,287
Operating expenses:
General and administrative		3,313,080		2,402,795		7,233,591		5,118,745
Sales and marketing		2,948,425		2,907,788		5,948,403		5,977,344
Research and development		961,952		662,599		1,755,666		1,181,694
Total operating expenses		7,223,457		5,973,182		14,937,660		12,277,783
Income from operations		4,963,035		4,166,581		8,970,285		7,241,504
Other income (expense), net		335,387		13,102		677,796		(1,812)
Income before provision for income taxes		5,298,422		4,179,683		9,648,081		7,239,692
Provision for income tax expense		1,118,582		938,631		2,062,171		1,511,926
Net income	$	4,179,840	$	3,241,052	$	7,585,910	$	5,727,766
Net income per share:
Basic	$	0.33	$	0.26	$	0.60	$	0.46
Diluted	$	0.33	$	0.26	$	0.60	$	0.45
Weighted average shares outstanding:
Basic		12,596,032		12,560,812		12,594,541		12,556,837
Diluted		12,723,017		12,632,755		12,706,608		12,641,424

See accompanying notes to unaudited condensed financial statements.

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IRADIMED CORPORATION

CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Net income	$	4,179,840	$	3,241,052	$	7,585,910	$	5,727,766
Other comprehensive (loss) income:
Change in fair value of available-for-sale securities, net of tax expense (benefit) of $0 and $(22), respectively		—		(68)		—		(10,953)
Realized gain on available-for-sale securities reclassified to net income, net of tax expense of $0 and $0 respectively		—		(6,059)		—		(6,059)
Other comprehensive loss		—		(6,127)		—		(17,012)
Comprehensive income	$	4,179,840	$	3,234,925	$	7,585,910	$	5,710,754

See accompanying notes to unaudited condensed financial statements.

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IRADIMED CORPORATION

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)


								Accumulated
				Additional				Other
	Common Stock			Paid-in		Retained		Comprehensive		Stockholders’
	Shares	Amount		Capital		Earnings		Income		Equity
Balances, December 31, 2022	12,591,004	$	1,259	$	26,407,446	$	47,264,282	$	—	$	73,672,987
Net income	—		—		—		3,406,070		—		3,406,070
Dividends paid ($1.05 per share)	—		—		—		(13,222,907)		—		(13,222,907)
Other comprehensive (loss)	—		—		—		(4)		—		(4)
Stock-based compensation expense	—		—		533,643		—		—		533,643
Net share settlement of restricted stock units	3,572		—		(49,878)		—		—		(49,878)
Balances, March 31, 2023	12,594,576	$	1,259	$	26,891,211	$	37,447,441	$	—	$	64,339,911
Net income	—		—		—		4,179,840		—		4,179,840
Other comprehensive (loss)	—		—		—		—		—		—
Stock-based compensation expense	—		—		568,453		—		—		568,453
Net share settlement of restricted stock units	5,965		1		(97,106)		—		—		(97,105)
Exercise of stock options	1,000		—		7,339		—		—		7,339
Balances, June 30, 2023	12,601,541	$	1,260	$	27,369,898	$	41,627,281	$	—	$	68,998,438


								Accumulated
				Additional				Other
	Common Stock			Paid-in		Retained		Comprehensive		Stockholders’
	Shares	Amount		Capital		Earnings		Income		Equity
Balances, December 31, 2021	12,544,024	$	1,254	$	25,160,618	$	46,994,922	$	17,012	$	72,173,806
Net income	—		—		—		2,486,713		—		2,486,713
Dividends paid ($1.00 per share)	—		—		—		(12,559,127)		—		(12,559,127)
Other comprehensive (loss)	—		—		—		—		(10,885)		(10,885)
Stock-based compensation expense	—		—		453,360		—		—		453,360
Net share settlement of restricted stock units	3,879		1		(67,381)		—		—		(67,380)
Exercise of stock options	12,566		1		71,947		—		—		71,948
Balances, March 31, 2022	12,560,469	$	1,256	$	25,618,544	$	36,922,508	$	6,127	$	62,548,435
Net income	—		—		—		3,241,052		—		3,241,052
Other comprehensive (loss)	—		—		—		—		(6,127)		(6,127)
Stock-based compensation expense	—		—		121,003		—		—		121,003
Net share settlement of restricted stock units	556		—		(5,726)		—		—		(5,726)
Exercise of stock options	—		—		—		—		—		—
Balances, June 30, 2022	12,561,025	$	1,256	$	25,733,821	$	40,163,560	$	—	$	65,898,637

See accompanying notes to unaudited condensed financial statements.

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IRADIMED CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)


	Six Months Ended
	June 30,
	2023		2022
Operating activities:
Net income	$	7,585,910	$	5,727,766
Adjustments to reconcile net income to net cash provided by operating activities:
Change in allowance for doubtful accounts		170,905		21,370
Change in provision for excess and obsolete inventory		167,383		19,824
Depreciation and amortization		369,908		928,101
Loss (Gain) on disposal of property and equipment		3,852		(4,894)
Stock-based compensation		1,102,096		574,363
Deferred income taxes, net		(1,065,516)		(144,948)
Loss on maturities of investments		—		(8,025)
Changes in operating assets and liabilities:
Accounts receivable		2,021,403		(3,295,542)
Inventory		(4,212,765)		(587,502)
Prepaid expenses and other current assets		57,568		(451,276)
Other assets		541,548		10,419
Accounts payable		1,709,063		(15,622)
Accrued payroll and benefits		(539,247)		(545,393)
Other accrued taxes		95,577		95,055
Warranty reserve		11,449		(8,111)
Deferred revenue		(363,379)		(253,074)
Other current liabilities		250,000		(7,995)
Prepaid income taxes		254,093		1,010,890
Net cash provided by operating activities		8,159,848		3,065,406
Investing activities:
Proceeds from maturities of investments		—		500,000
Purchases of property and equipment		(6,600,521)		(371,935)
Capitalized intangible assets		(334,807)		(475,198)
Net cash used in investing activities		(6,935,328)		(347,133)
Financing activities:
Dividends paid		(13,222,907)		(12,559,127)
Proceeds from exercises of stock options		7,339		71,949
Taxes paid related to the net share settlement of equity awards		(146,983)		(73,106)
Net cash used in financing activities		(13,362,551)		(12,560,284)
Net decrease in cash and cash equivalents		(12,138,031)		(9,842,011)
Cash and cash equivalents, beginning of period		57,960,864		61,999,550
Cash and cash equivalents, end of period	$	45,822,833	$	52,157,539
Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	2,756,152	$	757,137
ROU asset recognized in exchange for new lease obligation	$	227,982	$	—
Operating and short-term lease payments recorded within cash flow provided by operating activities	$	324,362	$	257,117

See accompanying notes to unaudited condensed financial statements.

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IRADIMED CORPORATION

Notes to Unaudited Condensed Financial Statements

1 — Basis of Presentation

The accompanying interim condensed financial statements of IRADIMED CORPORATION (“IRADIMED”, the “Company”, “we”, “our”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally presented in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The interim financial information is unaudited, but reflects all normal adjustments that are, in the opinion of management, necessary for the fair presentation of our financial position, results of operations and cash flows for the interim periods presented. Operating results for the three and six months ended June 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023, and other interim periods, or future years or periods.

The accompanying interim condensed financial statements should be read in conjunction with the financial statements and related footnotes to financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. The accounting policies followed in the preparation of these interim condensed financial statements, except as described in Note 1, are consistent in all material respects with those described in Note 1 of our Form 10-K.

We operate in one reportable segment which is the development, manufacture and sale of Magnetic Resonance Imaging (“MRI”) compatible medical devices, related accessories, disposables and service for use primarily by hospitals and acute care facilities during MRI procedures.

Certain Significant Risks and Uncertainties

We market our products to end users in the United States and to third-party distributors internationally. Sales to end users in the United States are generally made on open credit terms. Management maintains an allowance for potential credit losses.

We have deposited our cash and cash equivalents with various financial institutions. Our cash and cash equivalents balances exceed federally insured limits regularly throughout the year. We have not incurred any losses related to these balances.

Our medical devices require clearance from the FDA and international regulatory agencies prior to commercialized sales. Our future products may not receive required approvals. If we were denied such approvals, or if such approvals were revoked or delayed or if we were unable to timely renew certain approvals for existing products, it would have a materially adverse impact on our business, results of operations and financial condition.

Certain key components of our products essential to their functionality are sole-sourced. Any disruption in the availability of these components would have a materially adverse impact on our business, results of operations and financial condition.

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Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the Company to measure and recognize expected credit losses for financial assets held and not accounted for at fair value through net income. In November 2018, April 2019 and May 2019, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments - Credit Losses and ASU 2019-05, Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief, which provided additional implementation guidance on ASU 2016-03. We have adopted previously mentioned ASU starting January 1, 2023 and it did not result in a material impact on our financial condition, results of operations or cash flows.

2 — Revenue Recognition

Disaggregation of Revenue

We disaggregate revenue from contracts with customers by geographic region and revenue type as we believe it best depicts the nature, amount, timing and uncertainty of our revenue and cash flow.

Revenue information by geographic region is as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022

	(unaudited)				(unaudited)
United States	$	12,949,526	$	10,816,691	$	24,928,050	$	20,796,032
International		3,180,870		1,904,878		6,677,430		4,236,247
Total revenue	$	16,130,396	$	12,721,569	$	31,605,480	$	25,032,279

Revenue information by type is as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022

	(unaudited)				(unaudited)
Devices:
MRI Compatible IV Infusion Pump Systems	$	4,522,568	$	3,853,016	$	10,061,383	$	7,134,955
MRI Compatible Patient Vital Signs Monitoring Systems		6,128,718		4,921,619		10,825,536		10,116,370
Ferro Magnetic Detection Systems		183,190		—		480,779		—
Total Devices revenue		10,834,476		8,774,635		21,367,698		17,251,325
Disposables, services and other		4,815,870		3,430,005		9,250,612		6,748,907
Amortization of extended warranty agreements		480,050		516,929		987,170		1,032,047
Total revenue	$	16,130,396	$	12,721,569	$	31,605,480	$	25,032,279

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Contract Liabilities

Our contract liabilities consist of:


	June 30,		December 31,
	2023		2022
	(unaudited)
Advance payments from customers	$	342,292	$	896,617
Shipments in-transit		19,833		14,696
Extended warranty agreements		4,365,107		3,837,006
Total	$	4,727,232	$	4,748,319

Changes in the contract liabilities during the periods presented are as follows:


	Deferred
	Revenue
		(unaudited)
Contract liabilities, December 31, 2022	$	4,748,319
Increases due to cash received from customers		2,464,337
Decreases due to recognition of revenue		(2,485,424)
Contract liabilities, June 30, 2023	$	4,727,232


	Deferred
	Revenue
		(unaudited)
Contract liabilities, December 31, 2021	$	4,232,439
Increases due to cash received from customers		1,969,841
Decreases due to recognition of revenue		(2,288,798)
Contract liabilities, June 30, 2022	$	3,913,482

Capitalized Contract Costs

Our capitalized contract costs totaled $199,776 and $340,044 as of June 30, 2023 and December 31, 2022, respectively, and are classified as other assets on the unaudited condensed balance sheet.

3 — Basic and Diluted Net Income per Share

Basic net income per share is based upon the weighted-average number of common shares outstanding during the period. Diluted net income per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Stock options, restricted stock units and performance-based restricted stock units granted by us represent the only dilutive effect reflected in diluted weighted-average shares outstanding.

The following table presents the computation of basic and diluted net income per share:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022

	(unaudited)				(unaudited)
Net income	$	4,179,840	$	3,241,052	$	7,585,910	$	5,727,766
Weighted-average shares outstanding — Basic		12,596,032		12,560,812		12,594,541		12,556,837
Effect of dilutive securities:
Stock options		19,333		19,168		18,893		22,784
Restricted stock units		69,112		52,775		57,610		61,803
Performance-based restricted stock units		38,540		—		35,564		—
Weighted-average shares outstanding — Diluted		12,723,017		12,632,755		12,706,608		12,641,424
Basic net income per share	$	0.33	$	0.26	$	0.60	$	0.46
Diluted net income per share	$	0.33	$	0.26	$	0.60	$	0.45

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Stock options and restricted stock units excluded from the calculation of diluted net income per share because the effect would have been anti-dilutive are as follows:


	Three Months Ended		Six Months Ended
	June 30,		June 30,
	2023	2022	2023	2022

	(unaudited)		(unaudited)
Anti-dilutive stock options and restricted stock units	—	30,728	11,141	25,197

4 — Inventory, net

Inventory consists of:


	June 30,		December 31,
	2023		2022
	(unaudited)
Raw materials	$	7,106,304	$	4,827,113
Work in process		754,670		369,761
Finished goods		960,776		411,647
Inventory before allowance for excess and obsolete		8,821,750		5,608,521
Allowance for excess and obsolete		(406,670)		(239,288)
Total	$	8,415,080	$	5,369,233

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5 — Property and Equipment, net

Property and equipment consist of:


	June 30,		December 31,
	2023		2022
	(unaudited)
Land	$	6,200,000	$	—
Computer software and hardware		1,271,277		1,121,455
Furniture and fixtures		1,695,772		1,573,587
Leasehold improvements		266,082		259,146
Machinery and equipment		2,419,147		2,210,181
Fixed assets in-process		617,760		665,773
		12,470,038		5,830,142
Accumulated depreciation		(3,749,765)		(3,430,330)
Total	$	8,720,273	$	2,399,812

Depreciation expense of property and equipment was $162,121 and $142,710 for the three months ended June 30, 2023 and 2022, respectively, and $319,435 and $277,581 for the six months ended June 30, 2023 and 2022, respectively.

Land Acquisition

On February 2, 2023, the Company entered into a reinstatement and amendment to the previously announced sale and purchase agreement with O Property, Ltd., a Florida limited partnership dated as of November 1, 2022, pursuant to which the parties agreed to consummate a sale of real property located in Orange County, Florida. Pursuant to the terms of the Reinstatement, the parties consummated the sale of approximately 26.5 acres of land to the Company for a purchase price of $6,200,000. The property was acquired as a site for future development of manufacturing, research labs, and office space to accommodate our increased operations and anticipated growth.

Property and equipment, net, information by geographic region is as follows:


	June 30,		December 31,
	2023		2022
	(unaudited)
United States	$	8,528,821	$	2,248,308
International		191,452		151,504
Total property and equipment, net	$	8,720,273	$	2,399,812

Long-lived assets held outside of the United States consist principally of tooling and machinery and equipment, which are components of property and equipment, net.

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6 — Intangible Assets, net

The following table summarizes the components of intangible asset balances:


	June 30,		December 31,
	2023		2022
	(unaudited)
Patents — in use	$	321,874	$	321,873
Patents — fully amortized		70,164		70,164
Patents — in process		127,108		123,153
Internally developed software — in use		872,218		872,218
Internally developed software — in process		1,820,173		1,489,322
Trademarks		27,697		27,697
		3,239,234		2,904,427
Accumulated amortization		(885,461)		(834,988)
Total	$	2,353,773	$	2,069,439

Amortization expense of intangible assets was $25,236 and $25,393 for the three months ended June 30, 2023 and 2022, respectively, and $50,473 and $50,649 for the six months ended June 30, 2023 and 2022, respectively.

Expected annual amortization expense for the remaining portion of 2023 and the next five years related to intangible assets is as follows (excludes in process intangible assets):


Six months ending December 31,2023	$	50,473
2024	$	100,544
2025	$	97,374
2026	$	85,658
2027	$	11,945
2028	$	9,343

7 — Fair Value Measurements

The fair values of cash equivalents, accounts receivables, net and accounts payable approximate their carrying amounts due to their short duration.

As of June 30, 2023 we did not have any asset or liabilities subject to recurring fair value measurements.

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8 — Accumulated Other Comprehensive Income

The components of accumulated other comprehensive income, net of tax, for the three months ended June 30, 2023 and 2022 are as follows:


	Unrealized (Losses)
	Gains on
	Available-For-Sale
	Securities
		(unaudited)
Balance at March 31, 2023	$	—
(Gain) Loss on available-for-sale securities, net		—
Reclassification realized in net earnings		—
Balance at June 30, 2023	$	—

Balance at March 31, 2022	$	6,127
(Gain) Loss on available-for-sale securities, net		(68)
Reclassification realized in net earnings		(6,059)
Balance at June 30, 2022	$	—

The components of accumulated other comprehensive income, net of tax, for the six months ended June 30, 2023 and 2022 are as follows:


	Unrealized (Losses)
	Gains on
	Available-For-Sale
	Securities
		(unaudited)
Balance at December 31, 2022	$	—
(Gain) Loss on available-for-sale securities, net		—
Reclassification realized in net earnings		—
Balance at June 30, 2023	$	—

Balance at December 31, 2021	$	17,012
(Gain) Loss on available-for-sale securities, net		(10,953)
Reclassification realized in net earnings		(6,059)
Balance at June 30, 2022	$	—

9 — Stock-Based Compensation

Stock-based compensation was recognized as follows in the unaudited Condensed Statements of Operations:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022

	(unaudited)				(unaudited)
Cost of revenue	$	62,430	$	7,955	$	124,173	$	87,379
General and administrative		291,346		10,604		580,730		207,374
Sales and marketing		169,160		62,253		306,367		199,675
Research and development		45,518		40,191		90,827		79,935
Total	$	568,454	$	121,003	$	1,102,097	$	574,363

As of June 30, 2023, we had $3,326,259 of unrecognized compensation cost related to unvested restricted stock units, which is expected to be recognized over a weighted-average period of 2.46 years. As of June 30, 2023, we had

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$730,618 of unrecognized compensation cost related to unvested performance-based restricted stock units, which is expected to be recognized over a weighted-average period of 2.21 years.

The following table presents a summary of our equity award activity for the six months ended June 30, 2023 (shares):


			Performance
			Based
	Stock	Restricted	Restricted
	Options	Stock Units	Stock Units
Outstanding beginning of period	24,010	151,337	27,884
Awards granted	—	3,656	—
Awards exercised/vested	(1,000)	(13,001)	—
Awards canceled/ forfeited	—	(70)	—
Outstanding end of period	23,010	141,922	27,884

10 — Income Taxes

For the three and six months ended June 30, 2023, we recorded a provision for income tax expense of $1,118,582 and $2,062,171, respectively. Our effective tax rate was 21.1 percent and 21.4 percent, respectively, and differed from the U.S. Federal statutory rate primarily due to U.S. state income tax expense, partially offset by benefits from foreign derived intangible income and research and development tax credits.

For the three and six months ended June 30, 2022, we recorded a provision for income tax expense of $938,631 and $1,511,926 respectively. Our effective tax rate was 22.5 percent and 20.9 percent respectively and differed from the U.S. Federal statutory rate primarily due to U.S. Federal income tax expense, partially offset by benefits from foreign derived intangible income and research and development tax credits.

As of June 30, 2023 and December 31, 2022, we had not identified or accrued for any uncertain tax positions. We are currently unaware of any uncertain tax positions that could result in significant payments, accruals, or other material deviations in this estimate over the next 12 months. We believe that our tax positions comply in all material respects with applicable tax law. However, tax law is subject to interpretation, and interpretations by taxing authorities could be different from ours, which could result in the imposition of additional taxes and penalties.

We file tax returns in the United States Federal jurisdiction and many U.S. state jurisdictions. Our returns are not currently under examination by the Internal Revenue Service. The Company remains subject to income tax examinations for our United States Federal and certain U.S. state income taxes for 2019 and subsequent years.

11 — Leases

We have entered into operating lease contracts for our manufacturing plant, office space, and various office equipment with one material lease contract outstanding.

In January 2014, we entered into a non-cancelable operating lease, commencing July 1, 2014, for our manufacturing and headquarters facility in Winter Springs, Florida owned by Susi, LLC, an entity controlled by our President, Chief Executive Officer, and Chairman of the Board, Roger Susi. Pursuant to the terms of our lease for this property, the monthly base rent is $34,133, adjusted annually for changes in the consumer price index. For the three months ended June 30, 2023 and 2022, the Company paid Susi, LLC $127,817 and $118,504 respectively. For the six months ended June 30, 2023 and 2022, the Company paid Susi, LLC $255,635 and $237,008 respectively. For the year ended December 31, 2022, the Company paid Susi, LLC $492,643 related to this lease. Under the terms of the lease, we are responsible for insurance and maintenance expenses. Prior to May 31, 2019, the expiration date of the initial lease term, and pursuant to the terms of the lease contract, we renewed the lease for an additional five years, resulting in a new lease expiration date of May 31, 2024. Unless advance written notice of termination is timely provided, the lease will automatically renew for one additional successive term of five years beginning in 2024, and thereafter, will be renewed

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IRADIMED CORP [IRMD] Filings
10-Q	[2023-08-03]
10-Q	[2023-05-04]
10-K	[2023-03-02]
10-Q	[2022-11-03]
10-Q	[2022-08-05]
10-Q	[2022-05-06]
10-K	[2022-03-04]
10-Q	[2021-11-05]
10-Q	[2021-08-06]
10-Q	[2021-05-07]
10-K	[2021-03-05]
10-Q	[2020-11-06]
10-Q	[2020-08-06]
10-Q	[2020-05-07]
10-K	[2020-03-06]
10-Q	[2019-11-07]
10-Q	[2019-08-07]
10-Q	[2019-05-08]
10-K	[2019-03-07]
10-Q	[2018-11-07]
10-Q	[2018-08-08]
10-Q	[2018-05-08]
10-K	[2018-03-08]
10-Q	[2017-11-06]
10-Q	[2017-08-04]
10-Q	[2017-05-05]
10-K	[2017-03-10]
10-Q	[2016-11-04]
10-Q	[2016-08-05]
10-Q	[2016-05-06]
10-K	[2016-03-10]
10-Q	[2015-11-10]
10-Q	[2015-08-11]
10-Q	[2015-05-11]
10-K	[2015-03-23]
10-Q	[2014-11-13]
10-Q	[2014-08-14]
S-1	[2014-06-18]