Revenue stable; Improving operating
results
SEATTLE, May 11, 2023
/PRNewswire/ -- Bsquare Corporation (NASDAQ: BSQR) today announced
financial results for the first quarter of 2023. Total revenue
was $8.1 million, an increase of
$0.2 million or 2% compared to the
fourth quarter of 2022. Gross profit was in-line with the
previous quarter while operating expenses decreased by $1.0 million. Loss from operations was
$0.4 million, which was a
$1.1 million improvement from the
fourth quarter operating loss. Cash, cash equivalents,
restricted cash and short-term investments totaled $34.0 million as of March
31, 2023, a decrease of $1.7 million since December 31, 2022.
"I am pleased with the quarter-over-quarter improvement in our
loss from operations. Our goal is to run the business as
efficiently as possible while we evaluate our strategic options and
our first quarter results are consistent with that goal," said
Ralph C. Derrickson, Bsquare
President and CEO. "We are evaluating all options for creating
value for shareholders including exploring if our business could
offer synergies to others, if acquisitions could accelerate our
growth, and if we should return capital to
shareholders," added Derrickson.
First
Quarter 2023 Results Compared to
Fourth Quarter 2022
- Revenue for the quarter was $8.1
million, an increase of $0.2
million or 2%. Partner Solutions revenue increased
$0.2 million, due to an additional
shipping day in the quarter, while Edge to Cloud revenue was
flat.
- First quarter gross profit was $1.3 million which was a slight increase from the
prior quarter. Both segments contributed to the improvement.
- Total operating expenses for the quarter were $1.7 million, which was a decrease of
$1.0 million from the prior quarter.
Decreased marketing and labor expense drove the change.
Additionally, the fourth quarter included $0.2 million of restructuring charges that did
not reoccur in the first quarter.
- Loss from operations for the quarter was $0.4 million compared to the fourth quarter loss
from operations of $1.5 million. Net
loss for the quarter was $71,000, or
$0.00 per diluted share, which was
less than the fourth quarter net loss of $1.2 million, or $0.06 per diluted share.
- The Company continued to execute a short-term, laddered
investment strategy designed to take advantage of rising interest
rates. Interest income for the quarter totaled $0.3 million.
- During the first quarter of 2023, the Company repurchased
303,638 shares for approximately $0.4
million. In total, we have repurchased 482,495 shares for
$0.6 million.
- Net loss for the quarter was $71,000, or $0.00
per diluted share, which was less than the fourth quarter net loss
of $1.2 million, or $0.06 per diluted share.
- Cash, cash equivalents, restricted cash and short-term
investments totaled $34.0 million on
March 31, 2023, a decrease of
$1.7 million compared to December 31, 2022. The cash decrease was driven
by share repurchases, prepaid costs and changes in working
capital.
Details as follows (unaudited, in thousands except percentages
and per share amounts):
|
|
Three Months
Ended
|
|
|
|
March 31,
2023
|
|
|
December
31, 2022
|
|
|
Quarter-
over-
Quarter
Change
|
|
|
March 31,
2022
|
|
|
Year-over-
Year
Change
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Partner
Solutions
|
|
$
|
7,267
|
|
|
$
|
7,077
|
|
|
$
|
190
|
|
|
$
|
9,132
|
|
|
$
|
(1,865)
|
|
Edge to
Cloud
|
|
|
874
|
|
|
|
878
|
|
|
|
(4)
|
|
|
|
600
|
|
|
|
274
|
|
Total
revenue
|
|
|
8,141
|
|
|
|
7,955
|
|
|
|
186
|
|
|
|
9,732
|
|
|
|
(1,591)
|
|
Total gross
profit
|
|
$
|
1,285
|
|
|
$
|
1,236
|
|
|
$
|
49
|
|
|
$
|
1,483
|
|
|
$
|
(198)
|
|
Gross margin
(1):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Partner
Solutions
|
|
|
15
|
%
|
|
|
15
|
%
|
|
|
—
|
|
|
|
17
|
%
|
|
|
(2.0)
|
|
Edge to
Cloud
|
|
|
24
|
%
|
|
|
22
|
%
|
|
|
2.0
|
|
|
|
(16)
|
%
|
|
|
40.0
|
|
Total gross
margin
|
|
|
16
|
%
|
|
|
16
|
%
|
|
|
—
|
|
|
|
15
|
%
|
|
|
1.0
|
|
Total operating
expenses
|
|
$
|
1,733
|
|
|
$
|
2,748
|
|
|
$
|
(1,015)
|
|
|
$
|
2,404
|
|
|
$
|
(671)
|
|
Net loss
|
|
|
(71)
|
|
|
|
(1,220)
|
|
|
|
1,149
|
|
|
|
(888)
|
|
|
|
817
|
|
Per basic and diluted
share
|
|
|
(0.00)
|
|
|
|
(0.06)
|
|
|
|
0.06
|
|
|
|
(0.05)
|
|
|
|
0.05
|
|
Cash, cash equivalents
and restricted cash
|
|
$
|
7,741
|
|
|
$
|
35,635
|
|
|
$
|
(27,894)
|
|
|
$
|
39,441
|
|
|
$
|
(31,700)
|
|
Notes:
(1) Quarter-over-quarter change and
year-over-year change represent percentage point change.
First Quarter 2023
Results Compared to First Quarter 2022
- Compared to the first quarter of 2022, total revenue decreased
by $1.6 million. Partner Solutions
revenue decreased $1.9 million while
Edge to Cloud revenue increased $0.3
million.
- Gross profit decreased $0.2
million driven by the Partner Solutions segment.
- Total operating expenses for the quarter were $1.7 million, a decrease of $0.7 million compared to the first quarter of
2022.
- Loss from operations for the quarter was $0.4 million, an improvement of $0.5 million compared to the first quarter of
2022. Net loss for the quarter was $71,000, or $0.00
per diluted share, compared to a net loss of $0.9 million, or $0.05 per diluted share, in the first quarter of
2022.
Conference Call
Management will host a conference call Thursday, May 11, 2023 at 5 p.m. Eastern Time (2
p.m. Pacific Time). To access the call dial 1-877-407-0789
or 1-201-689-8562 for international callers, and reference "Bsquare
Corporation First Quarter 2023 Earnings Conference Call."
A replay will be available for two weeks following the call by
dialing 1-844-512-2921, or 1-412-317-6671 for international
callers; reference pin number 13737833. A live and replay webcast
of the call will be available at www.bsquare.com in the investor
relations section.
About Bsquare
Corporation
Bsquare helps companies build connected products that
participate intelligently in their own security, deployment,
operation, and management, allowing our customers to realize the
full potential of a connected world. We have extensive experience
designing with Windows, Linux, Android, and other embedded
operating systems and now operate IoT networks ranging in size from
50,000 to more than 1 million devices for our customers. Our
technology is powering devices that help people be productive,
enhance quality of life, and preserve the resources of our planet.
Bsquare serves a global customer base from offices in Seattle, WA, and the United Kingdom. For more information,
visit www.bsquare.com.
Cautionary Note Regarding
Forward-Looking Statements
This release contains "forward-looking statements" within the
meaning of the safe-harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements can be identified by words such as: "expect,"
"continue," "believe," "plan," "strategy," "future," "may,"
"should," "will," and similar references to future periods.
Examples of forward-looking statements include, among others,
express or implied statements we make regarding the stability of
our business, expected improvements to our IoT and software
offerings, expected operating results in future periods, such as
anticipated revenue, gross margins, profitability, cash and
investments, and regarding strategies for customer retention,
growth, new product and service developments, and market position.
Forward-looking statements are neither historical facts nor
assurances about future performance. Instead, they are based on
current beliefs, expectations and assumptions about the future of
our business and other future conditions. Because forward-looking
statements relate to the future, they are subject to inherent
uncertainties, risks, and changes in circumstances that are
difficult to predict and many of which are outside of our control.
Our actual results and financial condition may differ materially
from those indicated in the forward-looking statements. Therefore,
you should not rely on any of these forward-looking statements.
Important factors that could cause our actual results and
financial condition to differ materially from those indicated in
the forward-looking statements include, among others: our ability
to execute our development initiatives and sales and marketing
strategies; the extent to which we are successful in gaining new
long-term customers and retaining existing ones; whether we are
able to maintain our favorable relationship with Microsoft as a
systems integrator and distributor; our success in leveraging
strategic partnering initiatives with companies such as Microsoft,
AWS and Intel; the ongoing impact of COVID-19 on our business and
on our customers and vendors; and such other risk factors as
discussed in our most recent Annual Report on Form 10-K and other
filings with the Securities and Exchange Commission. Any
forward-looking statement made by us in this release is based only
on information currently available to us and speaks only as of the
date on which it is made. Except as required by law, we undertake
no obligation to publicly update any forward-looking statement,
whether written or oral, that may be made from time to time,
whether as a result of new information, future developments or
otherwise.
Bsquare and
Investor Contact:
|
Cheryl Wynne
|
Bsquare Corporation, Chief Financial
Officer
|
+1
425.519.5900
|
investorrelations@bsquare.com
|
Bsquare and the Bsquare Logo are trademarks of Bsquare
Corporation in the U.S. and other countries. Other names and brands
herein may be trademarks of others.
BSQUARE
CORPORATION
CONDENSED
CONSOLIDATED BALANCE SHEETS
(In thousands,
except share amounts)
(Unaudited)
|
|
|
|
March 31,
2023
|
|
|
December 31,
2022
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
7,520
|
|
|
$
|
35,414
|
|
Restricted
cash
|
|
|
221
|
|
|
|
221
|
|
Short-term
investments
|
|
|
26,211
|
|
|
|
7
|
|
Accounts receivable,
net of allowance for doubtful accounts of $50 at March 31,
2023 and December 31, 2022
|
|
|
4,764
|
|
|
|
3,985
|
|
Contract
assets
|
|
|
138
|
|
|
|
51
|
|
Prepaid expenses and
other current assets
|
|
|
701
|
|
|
|
410
|
|
Total current
assets
|
|
|
39,555
|
|
|
|
40,088
|
|
Property and equipment,
net of accumulated depreciation
|
|
|
737
|
|
|
|
813
|
|
Right-of-use lease
assets, net
|
|
|
1,234
|
|
|
|
1,297
|
|
Other non-current
assets
|
|
|
24
|
|
|
|
24
|
|
Total
assets
|
|
$
|
41,550
|
|
|
$
|
42,222
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Third-party software
fees payable
|
|
$
|
4,273
|
|
|
$
|
4,073
|
|
Accounts
payable
|
|
|
165
|
|
|
|
414
|
|
Accrued
compensation
|
|
|
322
|
|
|
|
430
|
|
Other accrued
expenses
|
|
|
258
|
|
|
|
232
|
|
Deferred
revenue
|
|
|
179
|
|
|
|
252
|
|
Operating
lease
|
|
|
367
|
|
|
|
362
|
|
Total current
liabilities
|
|
|
5,564
|
|
|
|
5,763
|
|
Deferred revenue,
long-term
|
|
|
7
|
|
|
|
9
|
|
Operating lease,
long-term
|
|
|
981
|
|
|
|
1,051
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
Preferred stock, no
par value: 10,000,000 shares authorized; no shares issued and
outstanding
|
|
|
—
|
|
|
|
—
|
|
Common stock, no par
value: 37,500,000 shares authorized: 20,075,395 and
20,337,906 shares issued and outstanding at March 31, 2023 and
December 31,
2022, respectively
|
|
|
172,232
|
|
|
|
172,558
|
|
Accumulated other
comprehensive loss
|
|
|
(1,057)
|
|
|
|
(1,053)
|
|
Accumulated
deficit
|
|
|
(136,177)
|
|
|
|
(136,106)
|
|
Total shareholders'
equity
|
|
|
34,998
|
|
|
|
35,399
|
|
Total liabilities and
shareholders' equity
|
|
$
|
41,550
|
|
|
$
|
42,222
|
|
BSQUARE
CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands,
except per share amounts)
(Unaudited)
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2023
|
|
|
2022
|
|
Revenue:
|
|
|
|
|
|
|
|
|
Partner
Solutions
|
|
$
|
7,267
|
|
|
$
|
9,132
|
|
Edge to
Cloud
|
|
|
874
|
|
|
|
600
|
|
Total
revenue
|
|
|
8,141
|
|
|
|
9,732
|
|
Cost of
revenue:
|
|
|
|
|
|
|
|
|
Partner
Solutions
|
|
|
6,187
|
|
|
|
7,552
|
|
Edge to
Cloud
|
|
|
669
|
|
|
|
697
|
|
Total cost of
revenue
|
|
|
6,856
|
|
|
|
8,249
|
|
Gross
profit
|
|
|
1,285
|
|
|
|
1,483
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
|
1,449
|
|
|
|
2,143
|
|
Research and
development
|
|
|
284
|
|
|
|
261
|
|
Total operating
expenses
|
|
|
1,733
|
|
|
|
2,404
|
|
Loss from
operations
|
|
|
(448)
|
|
|
|
(921)
|
|
Other income (expense),
net
|
|
|
377
|
|
|
|
33
|
|
Loss before income
taxes
|
|
|
(71)
|
|
|
|
(888)
|
|
Income taxes
|
|
|
—
|
|
|
|
—
|
|
Net loss
|
|
$
|
(71)
|
|
|
$
|
(888)
|
|
Basic and diluted loss
per share
|
|
$
|
(0.00)
|
|
|
$
|
(0.05)
|
|
Shares used in per
share calculations:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
|
20,197
|
|
|
|
16,665
|
|
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SOURCE Bsquare