Delaware | 001-35525 | 33-0029027 | ||||||
(State or Other Jurisdiction
of Incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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5800 Corporate Drive
Pittsburgh, PA
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15237 | ||||
(Address of Principal Executive Offices)
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(Zip Code) |
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☒ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class |
Trading
Symbol(s)
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Name of each exchange on which registered | ||||||||||||
Common Stock, par value $0.001 per share | SMSI | NASDAQ |
Exhibit | Description | ||||
99.1 |
Press Release issued on February 22, 2024 |
||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Smith Micro Software, Inc. | ||||||||
Date: February 22, 2024 |
By: | /s/ James M. Kempton | ||||||
James M. Kempton | ||||||||
Vice President and Chief Financial Officer |
Smith Micro Software Fourth Quarter and Fiscal 2023 Financial Results |
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Smith Micro Software Fourth Quarter and Fiscal 2023 Financial Results |
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Smith Micro Software Fourth Quarter and Fiscal 2023 Financial Results |
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Smith Micro Software, Inc. | |||||||||||
Consolidated Balance Sheets | |||||||||||
(in thousands except share and par value data) | |||||||||||
December 31, 2023 |
December 31, 2022 |
||||||||||
(unaudited) | (audited) | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 7,125 | $ | 14,026 | |||||||
Accounts receivable, net of related allowances of $3 and $3 at December 31, 2023 and 2022, respectively | 7,912 | 10,501 | |||||||||
Prepaid expenses and other current assets | 1,843 | 1,983 | |||||||||
Total current assets | 16,880 | 26,510 | |||||||||
Equipment and improvements, net | 883 | 1,498 | |||||||||
Right-of-use assets | 2,759 | 3,722 | |||||||||
Other assets | 482 | 490 | |||||||||
Intangible assets, net | 29,532 | 36,320 | |||||||||
Goodwill | 35,041 | 35,041 | |||||||||
Total assets | $ | 85,577 | $ | 103,581 | |||||||
Liabilities and Stockholders' Equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 2,522 | $ | 3,236 | |||||||
Accrued payroll and benefits | 2,500 | 3,883 | |||||||||
Current operating lease liabilities | 1,483 | 1,441 | |||||||||
Other current liabilities | 1,137 | 1,589 | |||||||||
Current portion of convertible notes payable | — | 9,007 | |||||||||
Derivative liabilities | — | 1,575 | |||||||||
Total current liabilities | 7,642 | 20,731 | |||||||||
Non-current liabilities: | |||||||||||
Warrant liabilities | 597 | 3,317 | |||||||||
Operating lease liabilities | 1,780 | 2,976 | |||||||||
Deferred tax liabilities, net | 168 | 178 | |||||||||
Total non-current liabilities | 2,545 | 6,471 | |||||||||
Commitments and contingencies | |||||||||||
Stockholders' equity: | |||||||||||
Common stock, par value $0.001 per share; 100,000,000 shares authorized; 74,783,834 and 56,197,910 shares issued and outstanding (2023 and 2022, respectively) |
75 | 56 | |||||||||
Additional paid-in capital | 381,263 | 357,875 | |||||||||
Accumulated comprehensive deficit | (305,948) | (281,552) | |||||||||
Total stockholders’ equity | 75,390 | 76,379 | |||||||||
Total liabilities and stockholders' equity | $ | 85,577 | $ | 103,581 |
Smith Micro Software Fourth Quarter and Fiscal 2023 Financial Results |
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Smith Micro Software, Inc. | |||||||||||||||||||||||
Consolidated Statement of Operations | |||||||||||||||||||||||
(in thousands except share data) | |||||||||||||||||||||||
For the Three Months Ended December 31, |
For the Year Ended December 31, |
||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (audited) |
||||||||||||||||||||
Revenues | $ | 8,593 | $ | 11,405 | $ | 40,862 | $ | 48,513 | |||||||||||||||
Cost of revenues (including depreciation of $11, $20, $50, and $105 in the three and twelve months ended December 31, 2023 and 2022, respectively) |
2,159 | 3,328 | 10,559 | 14,210 | |||||||||||||||||||
Gross profit | 6,434 | 8,077 | 30,303 | 34,303 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Selling and marketing | 2,458 | 3,196 | 11,089 | 12,883 | |||||||||||||||||||
Research and development | 3,868 | 6,632 | 17,145 | 29,388 | |||||||||||||||||||
General and administrative | 3,331 | 3,623 | 12,779 | 15,507 | |||||||||||||||||||
Depreciation and amortization | 2,473 | 1,786 | 7,345 | 7,452 | |||||||||||||||||||
Total operating expenses | 12,130 | 15,237 | 48,358 | 65,230 | |||||||||||||||||||
Operating loss | (5,696) | (7,160) | (18,055) | (30,927) | |||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||
Change in fair value of warrant and derivative liabilities | 728 | 1,212 | 4,214 | 4,669 | |||||||||||||||||||
Loss on derecognition of debt | (1,006) | — | (3,991) | — | |||||||||||||||||||
Interest expense, net | (614) | (1,782) | (6,354) | (2,680) | |||||||||||||||||||
Other expense, net | 10 | (93) | (52) | (115) | |||||||||||||||||||
Loss before provision for income taxes | (6,578) | (7,823) | (24,238) | (29,053) | |||||||||||||||||||
Provision for income tax expense | 133 | 149 | 158 | 226 | |||||||||||||||||||
Net loss | $ | (6,711) | $ | (7,972) | $ | (24,396) | $ | (29,279) | |||||||||||||||
Loss per share: | |||||||||||||||||||||||
Basic and diluted | $ | (0.09) | $ | (0.14) | $ | (0.38) | $ | (0.53) | |||||||||||||||
Weighted average shares outstanding: | |||||||||||||||||||||||
Basic and diluted | 72,689 | 56,228 | 64,916 | 55,422 |
Smith Micro Software Fourth Quarter and Fiscal 2023 Financial Results |
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Smith Micro Software, Inc. | |||||||||||||||||||||||
Consolidated Statements of Cash Flows | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
For the Three Months Ended December 31, |
For the Year Ended December 31, |
||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (audited) |
||||||||||||||||||||
Operating activities: | |||||||||||||||||||||||
Net loss | $ | (6,711) | $ | (7,972) | $ | (24,396) | $ | (29,279) | |||||||||||||||
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||||||||||||||
Depreciation and amortization | 2,483 | 1,805 | 7,395 | 7,556 | |||||||||||||||||||
Non-cash lease expense | (31) | 68 | (191) | (306) | |||||||||||||||||||
Non-cash transaction costs including amortization of debt discount and issuance costs | 595 | 1,902 | 5,993 | 3,324 | |||||||||||||||||||
Change in fair value of warrant and derivative liabilities | (728) | (1,212) | (4,214) | (4,669) | |||||||||||||||||||
Loss on derecognition of debt | 1,006 | — | 3,991 | — | |||||||||||||||||||
Stock based compensation | 1,519 | 1,099 | 4,835 | 4,948 | |||||||||||||||||||
Deferred income taxes | (10) | 61 | (10) | 61 | |||||||||||||||||||
Loss on disposal of assets | — | (27) | 12 | 4 | |||||||||||||||||||
Changes in operating accounts: | |||||||||||||||||||||||
Accounts receivable | 2,381 | (1,023) | 2,589 | 85 | |||||||||||||||||||
Prepaid expenses and other assets | (208) | (211) | 12 | (25) | |||||||||||||||||||
Accounts payable and accrued liabilities | (604) | 406 | (2,825) | (1,120) | |||||||||||||||||||
Other liabilities | (717) | 321 | (164) | 160 | |||||||||||||||||||
Net cash used in operating activities |
(1,025) | (4,783) | (6,973) | (19,261) | |||||||||||||||||||
Investing activities: | |||||||||||||||||||||||
Capital expenditures, net | 1 | 36 | (4) | (49) | |||||||||||||||||||
Other investing activities | 66 | 70 | 136 | 164 | |||||||||||||||||||
Net cash provided by investing activities |
67 | 106 | 132 | 115 | |||||||||||||||||||
Financing activities: | |||||||||||||||||||||||
Proceeds from notes and warrants offering | — | — | — | 15,000 | |||||||||||||||||||
Proceeds from stock and warrants offering | — | — | — | 3,000 | |||||||||||||||||||
Stock, notes, and warrants offering costs | — | — | — | (1,227) | |||||||||||||||||||
Proceeds from financing arrangements | — | — | 981 | 1,541 | |||||||||||||||||||
Repayments of financing arrangements | 120 | (300) | (1,036) | (1,278) | |||||||||||||||||||
Other financing activities | (19) | 2 | (5) | 58 | |||||||||||||||||||
Net cash provided by (used in) financing activities |
101 | (298) | (60) | 17,094 | |||||||||||||||||||
Net decrease in cash and cash equivalents |
(857) | (4,975) | (6,901) | (2,052) | |||||||||||||||||||
Cash and cash equivalents, beginning of period | $ | 7,982 | $ | 19,001 | $ | 14,026 | $ | 16,078 | |||||||||||||||
Cash and cash equivalents, end of period | $ | 7,125 | $ | 14,026 | $ | 7,125 | $ | 14,026 |
Smith Micro Software Fourth Quarter and Fiscal 2023 Financial Results |
Page 7 |
Smith Micro Software, Inc. | ||||||||||||||||||||||||||
Reconciliation of GAAP to Non-GAAP Results | ||||||||||||||||||||||||||
(in thousands, except per share data) - unaudited | ||||||||||||||||||||||||||
GAAP | Stock Compensation | Intangibles Amortization | Depreciation | Fair Value Adjustments | Amortization of Debt Issuance Costs and Discount | Personnel Severance and Reorganization Activities | Non-GAAP | |||||||||||||||||||
Three Months Ended December 31, 2023 |
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Gross profit | $ | 6,434 | $ | — | $ | — | $ | 11 | $ | — | $ | — | $ | — | $ | 6,445 | ||||||||||
Selling and marketing | 2,458 | (302) | — | — | — | — | — | 2,156 | ||||||||||||||||||
Research and development | 3,868 | (302) | — | — | — | — | — | 3,566 | ||||||||||||||||||
General and administrative | 3,331 | (915) | — | — | — | — | (155) | 2,261 | ||||||||||||||||||
Depreciation and amortization | 2,473 | — | (2,369) | (104) | — | — | — | — | ||||||||||||||||||
Total operating expenses | 12,130 | (1,519) | (2,369) | (104) | — | — | (155) | 7,983 | ||||||||||||||||||
(Loss) income before provision for income taxes | (6,578) | 1,519 | 2,369 | 115 | 278 | 595 | 155 | (1,547) | ||||||||||||||||||
Net (loss) income | (6,711) | 1,519 | 2,369 | 115 | 278 | 595 | 155 | (1,680) | ||||||||||||||||||
(Loss) earnings per share: diluted | (0.09) | 0.02 | 0.03 | — | — | 0.01 | — | (0.02) | ||||||||||||||||||
Three Months Ended December 31, 2022 |
||||||||||||||||||||||||||
Gross profit | $ | 8,077 | $ | — | $ | — | $ | 20 | $ | — | $ | — | $ | — | $ | 8,097 | ||||||||||
Selling and marketing | 3,196 | (186) | — | — | — | — | (68) | 2,942 | ||||||||||||||||||
Research and development | 6,632 | (274) | — | — | — | — | (364) | 5,994 | ||||||||||||||||||
General and administrative | 3,623 | (639) | — | — | — | — | (184) | 2,800 | ||||||||||||||||||
Depreciation and amortization | 1,786 | — | (1,545) | (241) | — | — | — | — | ||||||||||||||||||
Total operating expenses | 15,237 | (1,099) | (1,545) | (241) | — | — | (616) | 11,736 | ||||||||||||||||||
(Loss) income before provision for income taxes | (7,823) | 1,099 | 1,545 | 261 | (1,212) | 1,661 | 616 | (3,853) | ||||||||||||||||||
Net (loss) income | (7,972) | 1,099 | 1,545 | 261 | (1,212) | 1,661 | 616 | (4,002) | ||||||||||||||||||
(Loss) earnings per share: basic and diluted | (0.14) | 0.02 | 0.03 | — | (0.02) | 0.03 | 0.01 | (0.07) | ||||||||||||||||||
Smith Micro Software Fourth Quarter and Fiscal 2023 Financial Results |
Page 8 |
Smith Micro Software, Inc. | ||||||||||||||||||||||||||
Reconciliation of GAAP to Non-GAAP Results | ||||||||||||||||||||||||||
(in thousands, except per share data) - unaudited | ||||||||||||||||||||||||||
GAAP | Stock Compensation | Intangibles Amortization | Depreciation | Fair Value Adjustments | Amortization of Debt Issuance Costs and Discount | Personnel Severance and Reorganization Activities | Non-GAAP | |||||||||||||||||||
Year Ended December 31, 2023 |
||||||||||||||||||||||||||
Gross profit | $ | 30,303 | $ | — | $ | — | $ | 50 | $ | — | $ | — | $ | 183 | $ | 30,536 | ||||||||||
Selling and marketing | 11,089 | (955) | — | — | — | — | (93) | 10,041 | ||||||||||||||||||
Research and development | 17,145 | (1,056) | — | — | — | — | (471) | 15,618 | ||||||||||||||||||
General and administrative | 12,779 | (2,823) | — | — | — | — | (363) | 9,593 | ||||||||||||||||||
Depreciation and amortization | 7,345 | — | (6,789) | (556) | — | — | — | — | ||||||||||||||||||
Total operating expenses | 48,358 | (4,834) | (6,789) | (556) | — | — | (927) | 35,252 | ||||||||||||||||||
(Loss) income before provision for income taxes | (24,238) | 4,834 | 6,789 | 606 | (223) | 5,993 | 1,110 | (5,129) | ||||||||||||||||||
Net (loss) income | (24,396) | 4,834 | 6,789 | 606 | (223) | 5,993 | 1,110 | (5,287) | ||||||||||||||||||
(Loss) earnings per share: basic and diluted | (0.38) | 0.07 | 0.10 | 0.01 | — | 0.09 | 0.02 | (0.08) | ||||||||||||||||||
Year Ended December 31, 2022 |
||||||||||||||||||||||||||
Gross profit | $ | 34,303 | $ | 2 | $ | — | $ | 105 | $ | — | $ | — | $ | — | $ | 34,410 | ||||||||||
Selling and marketing | 12,883 | (522) | — | — | — | — | (837) | 11,524 | ||||||||||||||||||
Research and development | 29,388 | (1,082) | — | — | — | — | (364) | 27,942 | ||||||||||||||||||
General and administrative | 15,507 | (2,764) | — | — | — | (630) | (183) | 11,930 | ||||||||||||||||||
Depreciation and amortization | 7,452 | — | (6,312) | (1,140) | — | — | — | — | ||||||||||||||||||
Total operating expenses | 65,230 | (4,368) | (6,312) | (1,140) | — | (630) | (1,384) | $ | 51,396 | |||||||||||||||||
(Loss) income before provision for income taxes | (29,053) | 4,370 | 6,312 | 1,245 | (4,669) | 3,083 | 1,384 | (17,328) | ||||||||||||||||||
Net (loss) income | (29,279) | 4,370 | 6,312 | 1,245 | (4,669) | 3,083 | 1,384 | (17,554) | ||||||||||||||||||
(Loss) earnings per share: basic and diluted | (0.53) | 0.08 | 0.11 | 0.02 | (0.08) | 0.06 | 0.02 | (0.32) |