Markforged Announces Third Quarter 2022 Results

We recommend that you review the reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures provided in the financial statement tables included below in this press release, and that you not rely on any single financial measure to evaluate our business. Additionally, to the extent that forward-looking non-GAAP financial measures are provided, they are presented on a non-GAAP basis without reconciliations of such forward-looking non-GAAP measures due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations.

Investors should note that beginning with the second quarter of 2022, we have modified the presentation of “non-recurring costs” included in non-GAAP gross margin, non-GAAP operating profit (loss), non-GAAP net profit (loss) and non-GAAP earnings per share metrics to include certain non-recurring litigation costs. We use these metrics to provide an understanding of the results of its core business performance and believe these non-recurring litigation costs are reflective of one-time expenses that are not indicative of the performance of our core business’ operations. This change increases “non-recurring costs” by $0.6 million, $1.0 million, and $0.8 million in the first through third quarters of 2022, respectively, and by $3.7 million, $0.9 million, and $2.3 million in the first through third quarters of 2021, respectively. To conform to the current period’s presentation, we have included non-recurring litigation costs as “non-recurring costs” when presenting the foregoing non-GAAP figures for the year to date period and periods presented for 2021.

The following are the non-GAAP financial measures referenced in this press release and presented in the tables below:

  • Non-GAAP gross margin is defined as GAAP operating profit (loss), less stock-based compensation expense and certain non-recurring costs, divided by revenue.
  • Non-GAAP operating profit (loss) is defined as GAAP operating profit (loss) less stock-based compensation expense and certain non-recurring costs.
  • Non-GAAP net profit (loss) is defined as GAAP net profit (loss) less stock-based compensation expense, net change in fair value of warrant liabilities and contingent earnout liabilities, and certain non-recurring costs.
  • Non-GAAP earnings per share is defined as GAAP net profit (loss) less stock-based compensation expense, net change in fair value of warrant liabilities and contingent earnout liabilities, and certain non-recurring costs, divided by diluted weighted average shares outstanding for the period.

Special Note Regarding Forward-Looking Statements

This press release contains forward-looking statements that are based on beliefs and assumptions and on information currently available. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “strategy,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing,” “opportunity” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. Although Markforged believes that it has a reasonable basis for each forward-looking statement contained in this press release, Markforged cautions you that these statements are based on a combination of facts and factors currently known by it and its projections of the future, about which it cannot be certain. Forward-looking statements in this press release include, but are not limited to, future growth rate, revenue, gross profit margin and earnings guidance; timing for achieving profitability; our ability to fulfill orders for our products in a timely fashion in the future; expected growth, the size of and opportunity to increase our addressable market; the anticipated benefits of the acquisition of Digital Metal, the rate and extent of adoption of our products, including, but not limited to, our most recently introduced products; market trends in the manufacturing industry; the effects of macroeconomic factors; and the benefits to consumers, functionality and applications of Markforged’s products. Markforged cannot assure you that the forward-looking statements in this press release will prove to be accurate. These forward looking statements are subject to a number of risks and uncertainties, including, among others, general economic, political and business conditions; the ability of Markforged to maintain its listing on the New York Stock Exchange; the effect of COVID-19 on Markforged’s business and financial results; the outcome of any legal proceedings against Markforged; and those factors discussed under the header “Risk Factors” in Markforged’s most recent periodic and other filings with the SEC. Furthermore, if the forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that Markforged will achieve its objectives and plans in any specified time frame, or at all. The forward-looking statements in this press release represent Markforged’s views as of the date of this press release. Markforged anticipates that subsequent events and developments will cause its views to change. However, while Markforged may elect to update these forward-looking statements at some point in the future, Markforged has no current intention of doing so except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing Markforged’s views as of any date subsequent to the date of this press release.

 

MARKFORGED HOLDING CORPORATION

 

CONDENSED CONSOLIDATED BALANCE SHEETS

 

As of September 30, 2022 and December 31, 2021

 

(In thousands, except share data and par value amounts) (Unaudited)

 

 

 

 

 

 

 

 

 

 

September 30,
2022

 

 

December 31,
2021

 

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

 

$

181,805

 

 

$

288,603

 

Accounts receivable, net

 

 

30,135

 

 

 

26,777

 

Inventory

 

 

24,561

 

 

 

10,377

 

Prepaid expenses

 

 

3,647

 

 

 

3,921

 

Other current assets

 

 

2,918

 

 

 

511

 

Total current assets

 

 

243,066

 

 

 

330,189

 

Property and equipment, net

 

 

13,409

 

 

 

6,349

 

Goodwill

 

 

31,249

 

 

 

 

Intangible assets

 

 

15,377

 

 

 

 

Right-of-use assets

 

 

45,615

 

 

 

 

Other assets

 

 

3,150

 

 

 

776

 

Total assets

 

$

351,866

 

 

$

337,314

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities

 

 

 

Accounts payable

 

$

10,792

 

 

$

11,403

 

Accrued expenses

 

 

9,878

 

 

 

7,411

 

Deferred revenue

 

 

6,781

 

 

 

6,288

 

Operating lease liabilities

 

 

7,778

 

 

 

 

Other current liabilities

 

 

21

 

 

 

310

 

Total current liabilities

 

 

35,250

 

 

 

25,412

 

Long-term deferred revenue

 

 

4,535

 

 

 

3,742

 

Deferred rent

 

 

 

 

 

1,623

 

Contingent earnout liability

 

 

8,740

 

 

 

59,722

 

Long-term operating lease liabilities

 

 

40,333

 

 

 

 

Other liabilities

 

 

4,944

 

 

 

2,646

 

Total liabilities

 

 

93,802

 

 

 

93,145

 

Commitments and contingencies

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

Common stock, $0.0001 par value; 1,000,000,000 shares authorized at September 30, 2022 and December 31, 2021; 193,643,855 and 185,993,058 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively

 

 

19

 

 

 

19

 

Additional paid-in capital

 

 

350,022

 

 

 

319,859

 

Accumulated deficit

 

 

(90,365

)

 

 

(75,709

)

Accumulated other comprehensive income (loss)

 

 

(1,612

)

 

 

 

Total stockholders’ equity

 

 

258,064

 

 

 

244,169

 

Total liabilities and stockholders’ equity

 

$

351,866

 

 

$

337,314

 

 

MARKFORGED HOLDING CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three and Nine Months Ended September 30, 2022 and 2021

(In thousands, except share data and per share data) (Unaudited)

 

 

 

 

 

 

 

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Revenue

$

25,208

 

 

$

24,045

 

 

$

71,294

 

 

$

64,584

 

Cost of revenue

 

12,959

 

 

 

10,330

 

 

 

34,514

 

 

 

26,729

 

Gross profit

 

12,249

 

 

 

13,715

 

 

 

36,780

 

 

 

37,855

 

Operating expenses

 

 

 

 

 

 

 

Sales and marketing

 

11,783

 

 

 

10,399

 

 

 

35,104

 

 

 

25,711

 

Research and development

 

10,421

 

 

 

9,761

 

 

 

31,375

 

 

 

21,487

 

General and administrative

 

12,873

 

 

 

15,935

 

 

 

38,094

 

 

 

32,770

 

Total operating expenses

 

35,077

 

 

 

36,095

 

 

 

104,573

 

 

 

79,968

 

Loss from operations

 

(22,828

)

 

 

(22,380

)

 

 

(67,793

)

 

 

(42,113

)

Change in fair value of warrant liabilities

 

(448

)

 

 

1,418

 

 

 

1,221

 

 

 

170

 

Change in fair value of contingent earnout liability

 

(656

)

 

 

42,710

 

 

 

50,982

 

 

 

42,710

 

Other expense

 

(39

)

 

 

(48

)

 

 

(429

)

 

 

(168

)

Interest expense

 

(2

)

 

 

(6

)

 

 

(11

)

 

 

(15

)

Interest income

 

1,006

 

 

 

6

 

 

 

1,380

 

 

 

9

 

Profit (loss) before income taxes

 

(22,967

)

 

 

21,700

 

 

 

(14,650

)

 

 

593

 

Income tax benefit

 

3

 

 

 

(3

)

 

 

6

 

 

 

(1

)

Net profit (loss)

$

(22,970

)

 

$

21,703

 

 

$

(14,656

)

 

$

594

 

Weighted average shares outstanding - basic

 

189,766,945

 

 

 

162,942,990

 

 

 

188,225,543

 

 

 

81,373,265

 

Weighted average shares outstanding - diluted

 

189,766,945

 

 

 

167,091,320

 

 

 

188,225,543

 

 

 

85,407,166

 

Net profit (loss) per share - basic

$

(0.12

)

 

$

0.13

 

 

$

(0.08

)

 

$

0.01

 

Net profit (loss) per share - diluted

 

(0.12

)

 

 

0.13

 

 

 

(0.08

)

 

 

0.01

 

MARKFORGED HOLDING CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME (LOSS)
For the three and nine months ended September 30, 2022 and 2021
(In thousands) (Unaudited)

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2022

 

2021

 

 

2022

 

2021

 

Net income (loss)

$

(22,970

)

 

$

21,703

 

 

$

(14,656

)

 

$

594

 

Other comprehensive loss, net of taxes:

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

(1,612

)

 

 

 

 

 

(1,612

)

 

 

 

Total comprehensive income (loss), net of taxes of $0

$

(24,582

)

 

$

21,703

 

 

$

(16,268

)

 

$

594

 

 

MARKFORGED HOLDING CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

For the Three and Nine Months Ended September 30, 2022 and 2021

(In thousands) (Unaudited)

 

 

 

 

 

 

 

 

 

 

Three Months Ended
September 30,

Nine Months Ended
September 30,

 

 

2022

 

 

 

2021

 

 

2022

 

 

 

2021

 

Net profit (loss) and comprehensive income (loss)

$

(22,970

)

 

$

21,703

 

$

(14,656

)

 

$

594

 

Stock compensation expense

 

5,286

 

 

 

8,424

 

 

15,620

 

 

 

11,395

 

Change in fair value of warrant liabilities

 

 

448

 

 

 

(1,418

)

 

 

(1,221

)

 

 

(170

)

Change in fair value of contingent earnout liability

 

 

656

 

 

 

(42,710

)

 

 

(50,982

)

 

 

(42,710

)

Non-recurring costs 1

 

 

1,427

 

 

 

2,329

 

 

4,411

 

 

 

6,962

 

Non-GAAP net loss 2

$

(15,153

)

 

$

(11,672

)

$

(46,828

)

 

$

(23,929

)

 

 

 

 

 

 

 

 

 


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