Delaware | 000-50644 | 77-0492262 | ||||||||||||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (I.R.S. Employer Identification Number) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common Stock ($0.001 par value) | CUTR | The NASDAQ Stock Market, LLC |
Exhibit No. |
Description | |||||||
99.1 | ||||||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
CUTERA, INC. | |||||
Date: March 5, 2024 | /s/ Stuart Drummond |
||||
Stuart Drummond | |||||
Interim Chief Financial Officer |
September 30, 2023 |
December 31, 2022 |
|||||||||||||
Assets | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | 179,516 | $ | 145,924 | ||||||||||
Marketable investments | — | 171,390 | ||||||||||||
Accounts receivable, net | 49,829 | 45,562 | ||||||||||||
Inventories, net | 61,847 | 63,628 | ||||||||||||
Other current assets and prepaid expenses | 19,415 | 24,036 | ||||||||||||
Restricted cash | 700 | 700 | ||||||||||||
Total current assets | 311,307 | 451,240 | ||||||||||||
Property and equipment, net | 69,923 | 40,368 | ||||||||||||
Deferred tax assets | 528 | 590 | ||||||||||||
Goodwill | 1,339 | 1,339 | ||||||||||||
Operating lease right-of-use assets | 10,690 | 12,831 | ||||||||||||
Other long-term assets | 12,846 | 14,620 | ||||||||||||
Total assets | $ | 406,633 | $ | 520,988 | ||||||||||
Liabilities and Stockholders' Deficit | ||||||||||||||
Current liabilities: | ||||||||||||||
Accounts payable | $ | 31,373 | $ | 33,736 | ||||||||||
Accrued liabilities | 47,043 | 57,452 | ||||||||||||
Operating leases liabilities | 2,511 | 2,810 | ||||||||||||
Deferred revenue | 11,479 | 11,841 | ||||||||||||
Total current liabilities | 92,406 | 105,839 | ||||||||||||
Deferred revenue, net of current portion | 1,629 | 1,657 | ||||||||||||
Operating lease liabilities, net of current portion | 9,466 | 11,352 | ||||||||||||
Convertible notes, net of unamortized debt issuance costs | 418,129 | 416,459 | ||||||||||||
Other long-term liabilities | 1,088 | 862 | ||||||||||||
Total liabilities | 522,718 | 536,169 | ||||||||||||
Stockholders’ deficit: | ||||||||||||||
Common stock | 20 | 20 | ||||||||||||
Additional paid-in capital | 130,008 | 125,406 | ||||||||||||
Accumulated other comprehensive income (loss) | — | (94) | ||||||||||||
Accumulated deficit | (246,113) | (140,513) | ||||||||||||
Total stockholders' deficit | (116,085) | (15,181) | ||||||||||||
Total liabilities and stockholders' deficit | $ | 406,633 | $ | 520,988 | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, 2023 |
September 30, 2022 |
September 30, 2023 |
September 30, 2022 |
|||||||||||||||||||||||
Products | $ | 40,989 | $ | 56,540 | $ | 146,285 | $ | 167,195 | ||||||||||||||||||
Service | 5,489 | 6,268 | 16,544 | 17,851 | ||||||||||||||||||||||
Total net revenue | 46,478 | 62,808 | 162,829 | 185,046 | ||||||||||||||||||||||
Products | 36,586 | 25,255 | 98,696 | 74,066 | ||||||||||||||||||||||
Service | 3,435 | 3,305 | 9,961 | 9,900 | ||||||||||||||||||||||
Total cost of revenue | 40,021 | 28,560 | 108,657 | 83,966 | ||||||||||||||||||||||
Gross profit | 6,457 | 34,248 | 54,172 | 101,080 | ||||||||||||||||||||||
Gross margin % | 13.9 | % | 54.5 | % | 33.3 | % | 54.6 | % | ||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||
Sales and marketing | 25,808 | 26,488 | 88,591 | 78,433 | ||||||||||||||||||||||
Research and development | 4,592 | 6,389 | 16,844 | 19,747 | ||||||||||||||||||||||
General and administrative | 17,004 | 10,804 | 47,448 | 35,554 | ||||||||||||||||||||||
Total operating expenses | 47,404 | 43,681 | 152,883 | 133,734 | ||||||||||||||||||||||
Loss from operations | (40,947) | (9,433) | (98,711) | (32,654) | ||||||||||||||||||||||
Interest and other expense, net: | ||||||||||||||||||||||||||
Amortization of debt issuance costs | (561) | (400) | (1,670) | (917) | ||||||||||||||||||||||
Interest on Convertible notes | (2,939) | (1,739) | (8,836) | (3,666) | ||||||||||||||||||||||
Loss on extinguishment of convertible notes | — | — | — | (34,423) | ||||||||||||||||||||||
Interest income | 2,288 | 1,141 | 6,946 | 1,536 | ||||||||||||||||||||||
Other expense, net | (1,948) | (876) | (2,564) | (3,554) | ||||||||||||||||||||||
Total interest and other expense, net | (3,160) | (1,874) | (6,124) | (41,024) | ||||||||||||||||||||||
Loss before income taxes | (44,107) | (11,307) | (104,835) | (73,678) | ||||||||||||||||||||||
Income tax expense (benefit) | 167 | 827 | 765 | 874 | ||||||||||||||||||||||
Net loss | $ | (44,274) | $ | (12,134) | $ | (105,600) | $ | (74,552) | ||||||||||||||||||
Net income (loss) per share: | ||||||||||||||||||||||||||
Basic | $ | (2.22) | $ | (0.62) | $ | (5.32) | $ | (3.95) | ||||||||||||||||||
Diluted | $ | (2.22) | $ | (0.62) | $ | (5.32) | $ | (3.95) | ||||||||||||||||||
Weighted-average number of shares used in per share calculations: | ||||||||||||||||||||||||||
Basic | 19,932 | 19,593 | 19,858 | 18,897 | ||||||||||||||||||||||
Diluted | 19,932 | 19,593 | 19,858 | 18,897 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
September 30, 2023 | September 30, 2022 | September 30, 2023 | September 30, 2022 | ||||||||||||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||||||||||
Net income (loss) | $ | (44,274) | $ | (12,134) | $ | (105,600) | $ | (74,552) | |||||||||||||||||||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||||||||||||||||||||||||
Stock-based compensation | 1,616 | 4,245 | 6,552 | 13,021 | |||||||||||||||||||||||||
Depreciation and amortization | 1,987 | 674 | 5,225 | 1,603 | |||||||||||||||||||||||||
Amortization of contract acquisition costs | 3,016 | 596 | 7,085 | 1,815 | |||||||||||||||||||||||||
Amortization of debt issuance costs | 561 | 400 | 1,670 | 917 | |||||||||||||||||||||||||
Unrealized gain on foreign exchange forward | (292) | — | (292) | ||||||||||||||||||||||||||
Deferred tax assets | 19 | 72 | 62 | 152 | |||||||||||||||||||||||||
Provision for credit losses | 3,574 | 268 | 5,488 | 677 | |||||||||||||||||||||||||
Loss on sale of property and equipment | 23 | — | 86 | ||||||||||||||||||||||||||
Loss on extinguishment of convertible notes | — | — | 34,423 | ||||||||||||||||||||||||||
Accretion of discount on investment securities and investment income, net | 902 | — | 1,048 | — | |||||||||||||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||||||||||||||
Accounts receivable | 276 | (3,996) | (9,755) | (5,104) | |||||||||||||||||||||||||
Inventories, net | 2,317 | (11,114) | 1,781 | (28,615) | |||||||||||||||||||||||||
Other current assets and prepaid expenses | 5,128 | (5,801) | 4,352 | (8,835) | |||||||||||||||||||||||||
Other long-term assets | (860) | (2,573) | (5,642) | (3,644) | |||||||||||||||||||||||||
Accounts payable | (3,069) | 5,671 | (4,735) | 20,442 | |||||||||||||||||||||||||
Accrued liabilities | (7,157) | 3,194 | (10,963) | (3,684) | |||||||||||||||||||||||||
Operating leases, net | (14) | 10 | (44) | 46 | |||||||||||||||||||||||||
Deferred revenue | (899) | 874 | (390) | 1,576 | |||||||||||||||||||||||||
Net cash provided by (used in) operating activities | (36,877) | (19,883) | (103,866) | (49,968) | |||||||||||||||||||||||||
— | |||||||||||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||||||
Acquisition of property and equipment | (5,534) | (5,869) | (30,642) | (14,107) | |||||||||||||||||||||||||
Purchase of marketable and long-term investments | — | 47,000 | 193,903 | (252,282) | |||||||||||||||||||||||||
Proceeds from maturities of marketable investments | 41,044 | (48,973) | (23,467) | 47,000 | |||||||||||||||||||||||||
Net cash provided by (used in) investing activities | 35,510 | (7,842) | 139,794 | (219,389) | |||||||||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||||||
Proceeds from exercise of stock options and employee stock purchase plan | 465 | 248 | 1,323 | 1,687 | |||||||||||||||||||||||||
Taxes paid related to net share settlement of equity awards | (87) | (586) | (3,273) | (4,820) | |||||||||||||||||||||||||
Purchase of capped call | — | — | — | (31,671) | |||||||||||||||||||||||||
Payment of issuance costs of capped call | — | (353) | — | (353) | |||||||||||||||||||||||||
Proceeds from issuance of convertible notes | — | — | — | 240,000 | |||||||||||||||||||||||||
Payment of issuance costs of convertible notes | — | (646) | — | (7,602) | |||||||||||||||||||||||||
Taxes paid related to net share settlement of equity awards | — | — | — | (45,777) | |||||||||||||||||||||||||
Payments on finance lease obligations | (149) | (108) | (386) | (391) | |||||||||||||||||||||||||
Net cash provided by (used in) financing activities | 229 | (1,445) | (2,336) | 151,073 | |||||||||||||||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (1,138) | (29,170) | 33,592 | (118,284) | |||||||||||||||||||||||||
Cash, cash equivalents, and restricted cash at beginning of period | 181,354 | 75,750 | 146,624 | 164,864 | |||||||||||||||||||||||||
Cash, cash equivalents, and restricted cash at end of period | $ | 180,216 | $ | 46,580 | $ | 180,216 | $ | 46,580 |
Three Months Ended | % Change | Nine Months Ended |
% Change | ||||||||||||||||||||||||||||||||
September 30, 2023 |
September 30, 2022 |
2023 Vs 2022 |
September 30, 2023 |
September 30, 2022 |
2023 Vs 2022 |
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Revenue By Geography: | |||||||||||||||||||||||||||||||||||
North America | $ | 24,855 | $ | 33,258 | -25.3 | % | $ | 84,494 | $ | 94,350 | -10.4 | % | |||||||||||||||||||||||
Japan | 11,529 | 15,263 | -24.5 | % | 37,247 | 47,940 | -22.3 | % | |||||||||||||||||||||||||||
Rest of World | 10,094 | 14,287 | -29.3 | % | 41,088 | 42,756 | -3.9 | % | |||||||||||||||||||||||||||
Total Net Revenue | $ | 46,478 | $ | 62,808 | -26.0 | % | $ | 162,829 | $ | 185,046 | -12.0 | % | |||||||||||||||||||||||
International as a percentage of total revenue | 46.5 | % | 47.0 | % | 48.1 | % | 49.0 | % | |||||||||||||||||||||||||||
Revenue By Product Category: | |||||||||||||||||||||||||||||||||||
Systems | |||||||||||||||||||||||||||||||||||
–North America |
$ | 15,670 | $ | 25,359 | -38.2 | % | $ | 55,872 | $ | 73,298 | -23.8 | % | |||||||||||||||||||||||
–Rest of World (including Japan) |
10,607 | 15,626 | -32.1 | % | 41,617 | 47,854 | -13.0 | % | |||||||||||||||||||||||||||
Total Systems | 26,277 | 40,985 | -35.9 | % | 97,489 | 121,152 | -19.5 | % | |||||||||||||||||||||||||||
AviClear | 3,889 | 1,155 | +236.7 | % | 12,420 | 1,291 | +862.0 | % | |||||||||||||||||||||||||||
Consumables | 3,682 | 4,964 | -25.8 | % | 11,681 | 14,029 | -16.7 | % | |||||||||||||||||||||||||||
Skincare | 7,141 | 9,436 | -24.3 | % | 24,695 | 30,723 | -19.6 | % | |||||||||||||||||||||||||||
Total Products | 40,989 | 56,540 | -27.5 | % | 146,285 | 167,195 | -12.5 | % | |||||||||||||||||||||||||||
Service | 5,489 | 6,268 | -12.4 | % | 16,544 | 17,851 | -7.3 | % | |||||||||||||||||||||||||||
Total Net Revenue | $ | 46,478 | $ | 62,808 | -26.0 | % | $ | 162,829 | $ | 185,046 | -12.0 | % |
Three Months Ended | Nine Months Ended |
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September 30, 2023 |
September 30, 2022 |
September 30, 2023 |
September 30, 2022 |
||||||||||||||||||||
Pre-tax Stock-Based Compensation Expense: | |||||||||||||||||||||||
Cost of revenue | $ | (19) | $ | 471 | $ | 706 | $ | 1,430 | |||||||||||||||
Sales and marketing | 594 | 1,641 | 3,025 | 3,855 | |||||||||||||||||||
Research and development | (178) | 466 | 930 | 2,513 | |||||||||||||||||||
General and administrative | 1,219 | 1,667 | 1,891 | 5,223 | |||||||||||||||||||
$ | 1,616 | $ | 4,245 | $ | 6,552 | $ | 13,021 |
Three Months Ended September 30, 2023 |
|||||||||||||||||
Gross Profit | Gross Margin | Operating Income | |||||||||||||||
Reported | $ | 6,457 | 13.9 | % | $ | (40,947) | |||||||||||
Adjustments: | |||||||||||||||||
Depreciation and amortization including contract acquisition costs | 2,371 | 5.2 | % | 4,732 | |||||||||||||
Stock-based compensation | (19) | — | % | 1,616 | |||||||||||||
ERP implementation costs | — | — | 1,457 | ||||||||||||||
Legal | — | — | 562 | ||||||||||||||
Severance | 151 | 0.3 | % | 342 | |||||||||||||
Retention plan costs | 30 | 0.1 | % | 1,366 | |||||||||||||
Board of Director legal and advisory fees | — | — | 2,030 | ||||||||||||||
Other adjustments | — | — | 94 | ||||||||||||||
Total adjustments | 2,533 | 5.6 | % | 12,199 | |||||||||||||
Adjusted | $ | 8,990 | 19.5 | % | $ | (28,748) |
Three Months Ended September 30, 2022 |
|||||||||||||||||
Gross Profit | Gross Margin | Operating Income | |||||||||||||||
Reported | $ | 34,248 | 54.5 | % | $ | (9,433) | |||||||||||
Adjustments: | |||||||||||||||||
Depreciation and amortization including contract acquisition costs | 432 | 0.7 | % | 1,195 | |||||||||||||
Stock-based compensation | 908 | 1.4 | % | 4,245 | |||||||||||||
ERP implementation costs | — | — | 1,351 | ||||||||||||||
Legal | — | — | 566 | ||||||||||||||
Severance | — | — | 415 | ||||||||||||||
Other adjustments | (791) | (1.3) | % | (290) | |||||||||||||
Total adjustments | 549 | 0.8 | % | 7,482 | |||||||||||||
Adjusted | $ | 34,797 | 55.3 | % | $ | (1,951) |
Nine Months Ended September 30, 2023 |
|||||||||||||||||
Gross Profit | Gross Margin | Operating Income | |||||||||||||||
Reported | $ | 54,172 | 33.3 | % | $ | (98,711) | |||||||||||
Adjustments: | |||||||||||||||||
Depreciation and amortization including contract acquisition costs | 5,968 | 3.7 | % | 12,310 | |||||||||||||
Stock-based compensation | 706 | 0.4 | % | 6,552 | |||||||||||||
ERP implementation costs | — | — | 2,745 | ||||||||||||||
Legal | — | — | 1,608 | ||||||||||||||
Severance | 270 | 0.2 | % | 891 | |||||||||||||
Retention plan costs | 95 | 0.1 | % | 4,338 | |||||||||||||
Board of Director legal and advisory fees | — | — | % | 9,739 | |||||||||||||
Other adjustments | 307 | 0.2 | % | 986 | |||||||||||||
Total adjustments | 7,346 | 4.6 | % | 39,169 | |||||||||||||
Adjusted | $ | 61,518 | 37.9 | % | $ | (59,542) |
Nine Months Ended September 30, 2022 |
|||||||||||||||||
Gross Profit | Gross Margin | Operating Income | |||||||||||||||
Reported | $ | 101,080 | 54.7 | % | $ | (32,654) | |||||||||||
Adjustments: | |||||||||||||||||
Depreciation and amortization including contract acquisition costs | 596 | 0.3 | % | 3,342 | |||||||||||||
Stock-based compensation | 1,430 | 0.8 | % | 13,021 | |||||||||||||
ERP implementation costs | — | — | 7,712 | ||||||||||||||
Legal | — | — | 1,062 | ||||||||||||||
Severance | 26 | — | 415 | ||||||||||||||
Other adjustments | (290) | (0.2) | % | (290) | |||||||||||||
Total adjustments | 1,762 | 0.9 | % | 25,262 | |||||||||||||
Adjusted | $ | 102,842 | 55.6 | % | $ | (7,392) |