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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(In thousands, except per share data) Three Months Ended Nine Months Ended December 31, December 31, 2024 2023 2024 2023 Revenues Grid $52,306 $33,603 $131,578 $87,854 Wind 9,097 5,750 24,585 15,757 Total revenues 61,403 39,353 156,163 103,611 Cost of revenues 45,077 29,369 112,000 78,759 Gross margin 16,326 9,984 44,163 24,852 Operating expenses: Research and development 3,000 2,199 7,932 5,693 Selling, general and administrative 11,567 7,833 30,990 23,648 Amortization of acquisition-related intangibles 444 538 1,289 1,614 Change in fair value of contingent consideration — 852 6,682 3,052 Restructuring — — — (14)Total operating expenses 15,011 11,422 46,893 33,993 Operating income (loss) 1,315 (1,438) (2,730) (9,141) Interest income, net 802 150 2,901 518 Other income (expense), net 272 (298) (214) (618)Income (loss) before income tax expense (benefit) 2,389 (1,586) (43) (9,241) Income tax (benefit) expense (76) 63 (4,871) 291 Net income (loss) $2,465 $(1,649) $4,828 $(9,532) Net income (loss) per common share Basic $0.07 $(0.06) $0.13 $(0.33)Diluted $0.06 $(0.06) $0.13 $(0.33) Weighted average number of common shares outstanding Basic 37,661 29,092 36,766 28,728 Diluted 38,463 29,092 37,457 28,728 UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS(In thousands, except per share data) December 31, 2024 March 31, 2024 ASSETS Current assets: Cash and cash equivalents $75,203 $90,522 Accounts receivable, net 44,135 26,325 Inventory, net 74,588 41,857 Prepaid expenses and other current assets 10,194 7,295 Restricted cash 1,314 468 Total current assets 205,434 166,467 Property, plant and equipment, net 38,390 10,861 Intangibles, net 6,622 6,369 Right-of-use assets 4,050 2,557 Goodwill 48,950 43,471 Restricted cash 3,523 1,290 Deferred tax assets 1,155 1,119 Equity-method investments 1,397 — Other assets 757 637 Total assets $310,278 $232,771 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $29,425 $24,235 Lease liability, current portion 675 716 Debt, current portion — 25 Contingent consideration — 3,100 Deferred revenue, current portion 74,325 50,732 Total current liabilities 104,425 78,808 Deferred revenue, long term portion 9,003 7,097 Lease liability, long term portion 2,725 1,968 Deferred tax liabilities 1,423 300 Other liabilities 26 27 Total liabilities 117,602 88,200 Stockholders' equity: Common stock, $0.01 par value, 75,000,000 shares authorized; 39,863,084 and 37,343,812 shares issued and 39,459,733 and 36,946,181 shares outstanding at December 31, 2024 and March 31, 2024, respectively 399 373 Additional paid-in capital 1,256,210 1,212,913 Treasury stock, at cost, 403,351 and 397,631 at December 31, 2024 and March 31, 2024, respectively (3,765) (3,639)Accumulated other comprehensive income 1,662 1,582 Accumulated deficit (1,061,830) (1,066,658)Total stockholders' equity 192,676 144,571 Total liabilities and stockholders' equity $310,278 $232,771 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands) Nine Months Ended December 31, 2024 2023 Cash flows from operating activities: Net income (loss) $4,828 $(9,532)Adjustments to reconcile net income (loss) to net cash provided by (used in) operations: Depreciation and amortization 3,984 3,360 Stock-based compensation expense 4,933 3,608 Provision for excess and obsolete inventory 1,186 1,536 Amortization of operating lease right-of-use assets 753 457 Deferred income taxes (5,171) 3 Earnings from equity method investments (152) — Change in fair value of contingent consideration 6,682 3,052 Other non-cash items (177) 494 Changes in operating asset and liability accounts: Accounts receivable (1,650) 5,945 Inventory (10,836) (8,737)Prepaid expenses and other assets (1,658) 6,682 Operating leases (1,531) (450)Accounts payable and accrued expenses 118 (15,409)Deferred revenue 20,686 8,894 Net cash provided by (used in) operating activities 21,995 (97) Cash flows from investing activities: Purchases of property, plant and equipment (1,376) (635)Cash paid to settle contingent consideration liabilities (3,278) — Cash paid for acquisition, net of cash acquired (29,577) — Change in other assets 167 (8)Net cash used in investing activities (34,064) (643) Cash flows from financing activities: Repurchase of treasury stock (126) — Repayment of debt (25) (49)Cash paid related to registration of common stock shares (148) — Proceeds from exercise of employee stock options and ESPP 157 136 Net cash (used in) provided by financing activities (142) 87 Effect of exchange rate changes on cash (29) 3 Net decrease in cash, cash equivalents and restricted cash (12,240) (650)Cash, cash equivalents and restricted cash at beginning of period 92,280 25,675 Cash, cash equivalents and restricted cash at end of period $80,040 $25,025 RECONCILIATION OF GAAP NET INCOME (LOSS) TO NON-GAAP NET INCOME (LOSS)(In thousands, except per share data) Three Months Ended December 31, Nine Months Ended December 31, 2024 2023 2024 2023 Net income (loss) $2,465 $(1,649) $4,828 $(9,532)Stock-based compensation 2,861 1,140 4,933 3,608 Acquisition costs 15 — 1,095 — Amortization of acquisition-related intangibles 706 538 1,727 1,620 Change in fair value of contingent consideration — 852 6,682 3,052 Non-GAAP net income (loss) $6,047 $881 $19,265 $(1,252) Non-GAAP net income (loss) per share - basic $0.16 $0.03 $0.52 $(0.04)Non-GAAP net income (loss) per share - diluted $0.16 $0.03 $0.51 $(0.04)Weighted average shares outstanding - basic 37,661 29,092 36,766 28,728 Weighted average shares outstanding - diluted 38,463 29,428 37,457 28,728 Reconciliation of Forecast GAAP Net Loss to Non-GAAP Net Income(In millions, except per share data) Three Months Ending March 31, 2025 Net loss $(1.0)Stock-based compensation 2.8 Amortization of acquisition-related intangibles 0.7 Non-GAAP net income $2.5 Non-GAAP net income per share $0.07 Shares outstanding 37.9 Note: Non-GAAP net income (loss) is defined by the Company as net income (loss) before stock-based compensation; amortization of acquisition-related intangibles; acquisition costs; change in fair value of contingent consideration, other non-cash or unusual charges, and the tax effect of adjustments calculated at the relevant rate for our non-GAAP metric.
If this customer’s business is negatively affected, it could adversely impact our business; Our success in addressing the wind energy market is dependent on the manufacturers that license our designs; Our business and operations would be adversely impacted in the event of a failure or security breach of our or any critical third parties' information technology infrastructure and networks; We may acquire additional complementary businesses or technologies, which may require us to incur substantial costs for which we may never realize the anticipated benefits; Failure to comply with evolving data privacy and data protection laws and regulations or to otherwise protect personal data, may adversely impact our business and financial results; Many of our revenue opportunities are dependent upon subcontractors and other business collaborators; If we fail to implement our business strategy successfully, our financial performance could be harmed; Problems with product quality or product performance may cause us to incur warranty expenses and may damage our market reputation and prevent us from achieving increased sales and market share; Many of our customers outside of the United States may be either directly or indirectly related to governmental entities, and we could be adversely affected by violations of the United States Foreign Corrupt Practices Act and similar worldwide anti-bribery laws outside the United States; We have had limited success marketing and selling our superconductor products and system-level solutions, and our failure to more broadly market and sell our products and solutions could lower our revenue and cash flow; We or third parties on whom we depend may be adversely affected by natural disasters, including events resulting from climate change, and our business continuity and disaster recovery plans may not adequately protect us or our value chain from such events; Adverse changes in domestic and global economic conditions could adversely affect our operating results; Our international operations are subject to risks that we do not face in the United States, which could have an adverse effect on our operating results; Our products face competition, which could limit our ability to acquire or retain customers; We have operations in, and depend on sales in, emerging markets, including India, and global conditions could negatively affect our operating results or limit our ability to expand our operations outside of these markets.
Changes in India’s political, social, regulatory and economic environment may affect our financial performance; Our success depends upon the commercial adoption of the REG system, which is currently limited, and a widespread commercial market for our products may not develop; Industry consolidation could result in more powerful competitors and fewer customers; Increasing focus and scrutiny on environmental sustainability and social initiatives could increase our costs, and inaction could harm our reputation and adversely impact our financial results; Growth of the wind energy market depends largely on the availability and size of government subsidies, economic incentives and legislative programs designed to support the growth of wind energy: Lower prices for other energy sources may reduce the demand for wind energy development, which could have a material adverse effect on our ability to grow our Wind business; We may be unable to adequately prevent disclosure of trade secrets and other proprietary information; Our patents may not provide meaningful or long-term protection for our technology, which could result in us losing some or all of our market position; There are a number of technological challenges that must be successfully addressed before our superconductor products can gain widespread commercial acceptance, and our inability to address such technological challenges could adversely affect our ability to acquire customers for our products; Third parties have or may acquire patents that cover the materials, processes and technologies we use or may use in the future to manufacture our Amperium products, and our success depends on our ability to license such patents or other proprietary rights; Our common stock has experienced, and may continue to experience, market price and volume fluctuations, which may prevent our stockholders from selling our common stock at a profit and could lead to costly litigation against us that could divert our management’s attention; Unfavorable results of legal proceedings could have a material adverse effect on our business, operating results and financial condition; and the other important factors discussed under the caption "Risk Factors" in Part 1.
