Company demonstrates strong Year-over-Year revenue growth of 52%, driven by increase in automotive product sales

GREENSBORO, N.C. — (BUSINESS WIRE) — November 13, 2023 — Guerrilla RF, Inc. (OTCQX: GUER), a leading provider of state-of-the-art radio frequency and microwave communications solutions, today announced its financial and operating results for the third quarter ended September 30, 2023.

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Guerrilla RF, Inc., a leading provider of state-of-the-art radio frequency and microwave communications solutions, today announced its financial and operating results for the third quarter ended September 30, 2023. GRF demonstrated strong year-over-year revenue growth of 52%, driven by an increase in automotive product sales. (Graphic: Business Wire)

“Our Q3 revenue experienced a 51.7% year-over-year increase to $3.4 million, as we grew our sales in the automotive sector,” said Ryan Pratt, founder and CEO. “We continue to experience expanding product sales in the automotive sector and other growth markets. Our customer commitment remains strong, with a backlog of $6.0 million at the end of Q3 compared to $3.3 million at the end of Q3 last year.”

Mr. Pratt continued, “We continue to focus on expense control to reach operating cash flow break even mid-2024. Net cash used in operating activities was reduced by approximately $800,000 to $2.3 million for the third quarter from $3.1 million for the second quarter 2023.”

Financial Highlights for Q3 2023:

• Revenues were on the upper end of initial guidance of $3.0 to $3.5 million reported in August 2023 at $3.4 million for the three months ended September 30, 2023, as compared to $2.2 million in the year-ago quarter. The increase in revenues was primarily attributable to continued strength in the automotive market.
• Net cash used in operating activities decreased by approximately $800,000 to $2.3 million as compared to $3.1 million for the previous quarter.
• Subsequent to quarter end, the Company drew down additional funding of $1.25 million from an existing credit facility.
• Product revenue growth for the third quarter of fiscal 2023 increased 65.9% from the third quarter of fiscal 2022. Growth came from continued traction within the automotive space.
• Gross profit margin for the third quarter of fiscal 2023 was 55.7% of revenues, a decrease from 57.1% for the third quarter of fiscal 2022. This is a result of lower contribution margins from product mix shifts as compared to the year-over-year comparison.
• R&D expenses increased 32.3% to $2.8 million compared to $2.1 million for the prior year period and 4.6% quarter-over-quarter. The increase reflects the continued investment in new product development as well as the gallium arsenide (GaAs) build-out, and in the R&D team for the upcoming gallium nitride (GaN) products. We believe these investments are laying a solid foundation for the Company’s future product offerings.
• Operating loss for the third quarter of fiscal 2023 was $3.7 million as compared to $3.3 million for the third quarter of fiscal 2022. Increased investment in R&D ($678 thousand) and sales and marketing ($254 thousand) for the quarter compared to the prior year period together accounted for $932 thousand.
• Net loss per share was $0.62 and $0.66 for the third quarter of fiscal 2023 and 2022, respectively.
• Backlog (a non-GAAP measure) increased at the end of the third quarter of fiscal 2023 to $6.0 million as compared to $3.3 million at the end of the third quarter of fiscal 2022, and $5.6 million at the end of the second quarter 2023.
• Cash balance at September 30, 2023 was $0.9 million as compared to $2.1 million at the end of the third quarter of fiscal 2022. (The Company has subsequently drawn down an additional $1.25 million from an existing loan facility.)

Corporate Highlights:

• Management expects full year 2023 revenue to be between $14.7 and $15.2 million.
• Management expects full year 2024 revenue to be between $21.0 and $26.0 million.
• Continued focus on expense reduction is expected to allow the Company to achieve operational cash flow breakeven by mid- 2024, i.e. excluding interest expense, and other non-operating and non-recurring expenses.
• Recently announced first production purchase order (PO) and shipment to the satellite communications market (SATCOM) with PO from a tier 1 SATCOM company. The initial PO was for $360,000, the majority of which is expected to be shipped by year end. The Company expects SATCOM 2024 revenues to exceed $1.0 million and the total market opportunity to exceed $560 million.