Cognex Reports First Quarter 2024 Results

Table 1

Details of the Quarter

Statement of Operations Highlights – First Quarter of 2024

Balance Sheet and Cash Flow Highlights – March 31, 2024

Financial Outlook – Q2 2024

Analyst Conference Call and Simultaneous Webcast

COGNEX CORPORATION

CONSOLIDATED BALANCE SHEETS

			December 31,
			March 31, 2024						December 31, 2023
			(In thousands)
ASSETS
Current assets:
Cash and cash equivalents			$	138,859					$	202,655
Current investments, amortized cost of $141,876 and $132,799 in 2024 and 2023, respectively, allowance for credit losses of $0 in 2024 and 2023			139,334						129,392
Accounts receivable, allowance for credit losses of $1,339 and $583 in 2024 and 2023, respectively			138,556						114,164
Unbilled revenue			2,737						2,402
Inventories			170,871						162,285
Prepaid expenses and other current assets			71,173						68,099
Total current assets			661,530						678,997
Non-current investments, amortized cost of $285,376 and $250,790 in 2024 and 2023, respectively, allowance for credit losses of $0 in 2024 and 2023			278,426						244,230
Property, plant, and equipment, net			104,111						105,849
Operating lease assets			74,113						75,115
Goodwill			386,157						393,181
Intangible assets, net			105,054						112,952
Deferred income taxes			397,563						400,400
Other assets			6,279						7,088
Total assets			$	2,013,233					$	2,017,812
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable			$	27,459					$	21,454
Accrued expenses			70,429						72,374
Accrued income taxes			40,433						16,907
Deferred revenue and customer deposits			39,983						31,525
Operating lease liabilities			9,798						9,624
Total current liabilities			188,102						151,884
Non-current operating lease liabilities			67,367						68,977
Deferred income taxes			239,538						246,877
Reserve for income taxes			28,144						26,685
Non-current accrued income taxes			—						18,338
Other liabilities			893						299
Total liabilities			524,044						513,060
Commitments and contingencies
Shareholders’ equity:
Preferred stock, $.01 par value – Authorized: 400 shares in 2024 and 2023, respectively; no shares issued and outstanding			—						—
Common stock, $.002 par value – Authorized: 300,000 shares in 2024 and 2023, respectively; issued and outstanding: 171,662 and 171,599 shares in 2024 and 2023, respectively			343						343
Additional paid-in capital			1,047,643						1,037,202
Retained earnings			502,338						512,543
Accumulated other comprehensive loss, net of tax			(61,135)						(45,336)
Total shareholders’ equity			1,489,189						1,504,752
Total liabilities and shareholders' equity			$	2,013,233					$	2,017,812

COGNEX CORPORATION

CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited)

(In thousands, except per share amounts)

Non-GAAP Financial Measures

COGNEX CORPORATION

RECONCILIATION OF SELECTED ITEMS FROM GAAP TO NON-GAAP

(Unaudited)

Dollars in thousands, except per share amounts

Description of adjustments:

Loss (recovery) from fire:

Acquisition and integration costs:

Amortization of acquisition-related intangible assets:

Discrete tax (benefit) expense:

Certain statements made in this release, as well as oral statements made by the Company from time to time, constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. Readers can identify these forward-looking statements by our use of the words “expects,” “anticipates,” “estimates,” "potential," “believes,” “projects,” “intends,” “plans,” “will,” “may,” “shall,” “could,” “should,” "opportunity," "goal" and similar words and other statements of a similar sense. These statements are based on our current estimates and expectations as to prospective events and circumstances, which may or may not be in our control and as to which there can be no firm assurances given. These forward-looking statements, which include statements regarding business and market trends, growth opportunities, future financial performance and financial targets, customer demand and order rates and timing of related revenue, delivery lead times, future product mix, research and development activities, sales and marketing activities (including our Emerging Customer Program), new product offerings and product development activities, customer acceptance of our products, the potential effects of emerging technologies, capital expenditures, cost management activities, investments, liquidity, dividends and stock repurchases, strategic initiatives and growth plans, our ability to maintain and grow key relationships, acquisitions, and estimated tax benefits and expenses and other tax matters, involve known and unknown risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties include: (1) the technological obsolescence of current products and the inability to develop new products, particularly in connection with emerging artificial intelligence technologies; (2) the impact of competitive pressures; (3) the inability to attract and retain skilled employees and maintain our unique corporate culture; (4) the failure to properly manage the distribution of products and services; (5) economic, political, and other risks associated with international sales and operations, including the impact of trade disputes, the economic climate in China, and the wars in Ukraine

and Israel; (6) the challenges in integrating and achieving expected results from acquired businesses, including our acquisition of Moritex Corporation; (7) information security breaches; (8) the failure to comply with laws or regulations relating to data privacy or data protection; (9) the inability to protect our proprietary technology and intellectual property; (10) the failure to manufacture and deliver products in a timely manner; (11) the inability to obtain, or the delay in obtaining, components for our products at reasonable prices; (12) the failure to effectively manage product transitions or accurately forecast customer demand; (13) the inability to manage disruptions to our distribution centers or to our key suppliers; (14) the inability to design and manufacture high-quality products; (15) the loss of, or curtailment of purchases by, large customers in the logistics, consumer electronics, or automotive industries; (16) potential impairment charges with respect to our investments or acquired intangible assets; (17) exposure to additional tax liabilities, increases and fluctuations in our effective tax rate, and other tax matters; (18) fluctuations in foreign currency exchange rates and the use of derivative instruments; (19) unfavorable global economic conditions, including high interest rates and fluctuating inflation rates; (20) business disruptions from natural or man-made disasters, such as fire, or public health issues; (21) exposure to potential liabilities, increased costs, reputational harm, and other adverse effects associated with expectations relating to environmental, social, and governance considerations; (22) stock price volatility; and (23) our involvement in time-consuming and costly litigation or activist shareholder activities. The foregoing list should not be construed as exhaustive and we encourage readers to refer to the detailed discussion of risk factors included in Part I - Item 1A of the Company's Annual Report on Form 10-K and the other risks detailed in reports filed by the Company with the SEC. The Company cautions readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. The Company disclaims any obligation to subsequently revise forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date such statements are made.

About Cognex Corporation

Investor Contacts:

Nathan McCurren – Head of Investor Relations

Jordan Bertier – Sr. Manager, Investor Relations

Cognex Corporation

Cognex Names Dennis Fehr as Chief Financial Officer

About Cognex Corporation

Certain statements made in this news release, which do not relate solely to historical matters, are forward-looking statements. These statements can be identified by use of the words “expects,” “anticipates,” “estimates,” “potential,” “believes,” “projects,” “intends,” “plans,” “will,” “may,” “shall,” “could,” “should,” and similar words and other statements of a similar sense. These statements are based on our current estimates and expectations as to prospective events and circumstances, which may or may not be in our control and as to which there can be no firm assurances given. These forward-looking statements, which include statements regarding sales and marketing activities, new product offerings and product development activities, customer acceptance of our products, the potential effects of emerging technologies, capital expenditures, cost management activities, investments, liquidity, dividends and stock repurchases, and strategic and growth plans, our ability to maintain and grow key relationships, acquisitions, and estimated tax benefits and expenses and other tax matters, involve known and unknown risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties include: the technological obsolescence of current products and the inability to develop new products, particularly in connection with emerging artificial intelligence technologies; the impact of competitive pressures; the inability to attract and retain skilled employees and maintain our unique corporate culture; exposure to additional tax liabilities, increases and fluctuations in our effective tax rate, and other tax matters; fluctuations in foreign currency exchange rates; unfavorable global economic conditions, including increases in interest rates and high inflation rates; economic, political, and other risks associated with international sales and operations; and the other risks detailed in Cognex reports filed with the SEC, including its Form 10-K for the fiscal year ended December 31, 2023 and Form 10-Q

for the fiscal quarter ended March 31, 2024. You should not place undue reliance upon any such forward-looking statements, which speak only as of the date made. Cognex disclaims any obligation to update forward-looking statements after the date of such statements.

Investor Contacts:

Nathan McCurren – Head of Investor Relations

Jordan Bertier – Sr. Manager, Investor Relations

Cognex Corporation