Sixth Straight Quarter of Record Revenue
Culminates in 35% Growth Year for Fiscal 2023
SkyWater Technology, Inc. (NASDAQ: SKYT), the trusted technology
realization partner, today announced financial results for the
fourth quarter and full fiscal year 2023 ended December 31,
2023.
Financial Highlights for Q4 2023:
- Revenue increased 22% year-over-year to a record $79.2
million.
- Gross margin decreased to 15.2% on a GAAP basis, compared to
25.4% in Q4 2022, and decreased to 17.4% on a non-GAAP basis,
compared to 26.1% in Q4 2022.
- Net loss to shareholders of $10.3 million, or $(0.22) per share
on a GAAP basis, and net loss to shareholders of $1.1 million, or
$(0.02) per share on a non-GAAP basis, compared to net loss to
shareholders of $3.0 million, or $(0.07) per share on a GAAP basis,
and net loss to shareholders $1.5 million, or $(0.03) per share on
a non-GAAP basis in Q4 2022.
- Adjusted EBITDA of $10.6 million, or 13.4% of revenue, compared
to $10.3 million, or 15.9% of revenue in Q4 2022.
Financial Highlights for Fiscal Year 2023:
- Revenue increased 35% year-over-year to a record $286.7
million.
- Gross margin increased to 20.7% on a GAAP basis, compared to
12.2% in fiscal year 2022, and increased to 22.0% on a non-GAAP
basis, compared to 13.7% in fiscal year 2022.
- Net loss to shareholders of $30.8 million, or $(0.68) per share
on a GAAP basis, and net loss to shareholders of $7.7 million, or
$(0.17) per share on a non-GAAP basis, compared to net loss to
shareholders of $39.6 million, or $(0.97) per share on a GAAP
basis, and net loss to shareholders $30.3 million, or $(0.74) per
share on a non-GAAP basis in fiscal year 2022.
- Adjusted EBITDA of $37.2 million, or 13.0% of revenue, compared
to $7.7 million, or 3.6% of revenue in fiscal year 2022.
“We are pleased to deliver a solid finish to fiscal 2023, with
revenue growth exceeding our earlier expectations as a result of
strong customer demand for our differentiated Advanced Technology
Services (ATS) business,” commented Thomas Sonderman, SkyWater
president and chief executive officer. “We are now entering a
multi-year stage of increased levels of customer investments in our
production capacity and capabilities, and we anticipate these
investments will enable SkyWater to achieve another year of revenue
growth in 2024. The continued robust demand for our ATS business
demonstrates that our customers’ innovation investments remain
strong.”
Recent Business Highlights:
- Significantly exceeded long-term growth targets in fiscal 2023,
led by strong growth in ATS development revenue, which exceeded 50%
year-over-year.
- Secured customer commitments for capital investment over the
next several years, supporting continued year-over-year revenue
growth ahead.
- Announced a Department of Defense award of up to $190 million
for our Florida operation, reflecting the significant effort
underway to expand advanced packaging capabilities
domestically.
- Submitted our full CHIPS application during Q4, targeting
modernization and equipment upgrades to enhance production at our
Bloomington, Minnesota manufacturing facility.
- Continued momentum in bio-medical diagnostic applications
culminated in the recent milestone announcement that Nautilus
Biotech will be transitioning from ATS to Wafer Services for supply
of its silicon-based microfluidic bio chips for proteome
analysis.
- Our strategic business transformation initiatives of 2023 are
enabling us to deploy a leaner and more efficient organization
toward delivering consistent, continuous enhancements in
productivity and output in our ATS business.
Q4 2023 Summary:
GAAP
In millions, except per share data
Q4 2023
Q4 2022
Y/Y
Q3 2023
Q/Q
ATS development revenue (1)
$57.2
$47.8
19%
$53.9
6%
Tool revenue (2)
$9.9
$0.0
nm
$3.2
206%
Total ATS revenue
$67.1
$47.9
40%
$57.1
17%
Wafer Services revenue
$12.0
$17.2
(30)%
$14.5
(17)%
Total revenue
$79.2
$65.1
22%
$71.6
11%
Gross profit
$12.0
$16.6
(27)%
$14.1
(15)%
Gross margin
15.2%
25.4%
(1,020) bps
19.8%
(460) bps
Net loss to shareholders
$(10.3)
$(3.0)
240%
$(7.6)
(36)%
Basic loss per share
$(0.22)
$(0.07)
214%
$(0.16)
(38)%
Net loss margin to shareholders
(13.0)%
(4.7)%
(830) bps
(10.6)%
(240) bps
nm - Not meaningful
Non-GAAP
In millions, except per share data
Q4 2023
Q4 2022
Y/Y
Q3 2023
Q/Q
Non-GAAP gross profit
$13.8
$17.0
(19)%
$14.6
(5)%
Non-GAAP gross margin
17.4%
26.1%
(870) bps
20.4%
(300) bps
Non-GAAP net loss to shareholders
$(1.1)
$(1.5)
27%
$(2.2)
51%
Non-GAAP basic loss per share
$(0.02)
$(0.03)
33%
$(0.05)
60%
Adjusted EBITDA
$10.6
$10.3
2%
$8.3
28%
Adjusted EBITDA margin
13.4%
15.9%
(250) bps
11.6%
180 bps
Fiscal Year 2023 Summary:
GAAP
In millions, except per share data
FY 2023
FY 2022
Y/Y
ATS development revenue (1)
$210.9
$137.9
53%
Tool revenue (2)
$14.7
$1.5
848%
Total ATS revenue
$225.6
$139.4
62%
Wafer Services revenue
$61.1
$73.5
(17)%
Total revenue
$286.7
$212.9
35%
Gross profit
$59.3
$26.0
128%
Gross margin
20.7%
12.2%
850 bps
Net loss to shareholders
$(30.8)
$(39.6)
(22)%
Basic loss per share
$(0.68)
$(0.97)
(30)%
Net loss margin to shareholders
(10.7)%
(18.6)%
790 bps
Non-GAAP
In millions, except per share data
FY 2023
FY 2022
Y/Y
Non-GAAP gross profit
$63.0
$29.1
116%
Non-GAAP gross margin
22.0%
13.7%
830 bps
Non-GAAP net loss to shareholders
$(7.7)
$(30.3)
75%
Non-GAAP basic loss per share
$(0.17)
$(0.74)
77%
Adjusted EBITDA
$37.2
$7.7
383%
Adjusted EBITDA margin
13.0%
3.6%
940 bps
(1)
ATS development revenue represents GAAP revenue primarily
derived from process development services, tool installation and
qualification services, facility and tool access, and security
services.
(2)
Tool revenue primarily represents GAAP revenue that arises from
the purchase of equipment for our customers. This equipment is used
to complete ATS customer programs.
Q4 2023 Results:
- Revenue: Revenue of $79.2 million increased 22%
year-over-year. Total ATS revenue of $67.1 million increased 40%
year-over-year. Total ATS revenue included $9.9 million of tool
revenue in the fourth quarter of 2023 and $0.0 million in the
fourth quarter of 2022. Wafer Services revenue of $12.0 million
decreased 30% compared to the fourth quarter of 2022.
- Gross Profit: GAAP gross profit was $12.0 million, or
15.2% of total revenue, compared to gross profit of $16.6 million,
or 25.4% of total revenue, in the fourth quarter of 2022. Non-GAAP
gross profit was $13.8 million, or 17.4% of total revenue, compared
to non-GAAP gross profit of $17.0 million, or 26.1% of total
revenue, in the fourth quarter of 2022.
- Operating Expenses: GAAP operating expenses were $18.0
million, compared to $15.2 million in the fourth quarter of 2022,
and included $5.3 million of project-based management consulting
transformation fees related to long-term improvement in automation
and operational efficiency that were not a component of operating
expenses in the fourth quarter of 2022.
- Net Loss: GAAP net loss to shareholders of $10.3
million, or $(0.22) per share, compared to a net loss to
shareholders of $3.0 million, or $(0.07) per share, in the fourth
quarter of 2022. Non-GAAP net loss to shareholders of $1.1 million,
or $(0.02) per share, compared to a non-GAAP net loss to
shareholders of $1.5 million, or $(0.03) per share, in the fourth
quarter of 2022.
- Adjusted EBITDA: Adjusted EBITDA was $10.6 million, or
13.4% of total revenue, compared to $10.3 million, or 15.9% of
total revenue, in the fourth quarter of 2022.
A reconciliation between historical GAAP and non-GAAP
information is contained in the tables below in the section titled,
“Non-GAAP Financial Measures.”
Investor Webcast
SkyWater will host a conference call on Monday, February 26,
2024, at 3:30 p.m. CT to discuss its fourth quarter and fiscal year
2023 financial results. A live webcast of the call will be
available online at IR.SkyWaterTechnology.com.
About SkyWater Technology
SkyWater (NASDAQ: SKYT) is a U.S.-based semiconductor
manufacturer and a DMEA-accredited Category 1A Trusted Foundry.
SkyWater’s Technology as a Service model streamlines the path to
production for customers with development services, volume
production and heterogeneous integration solutions in its
world-class U.S. facilities. This pioneering model enables
innovators to co-create the next wave of technology with diverse
categories including mixed-signal CMOS, read-out ICs, rad-hard ICs,
power management, MEMS, superconducting ICs, photonics, carbon
nanotubes and interposers. SkyWater serves growing markets
including aerospace & defense, automotive, biomedical, cloud
& computing, consumer, industrial and IoT. For more
information, visit: www.skywatertechnology.com.
Cautionary Statement Regarding Preliminary Results
The Company’s results for the fourth quarter and fiscal year
ended December 31, 2023 are preliminary, unaudited and subject to
the finalization of the Company’s fourth quarter review and
full-year audit and should not be viewed as a substitute for full
financial statements prepared in accordance with GAAP. The Company
cautions that actual results may differ materially from those
described in this press release.
SkyWater Technology Forward-Looking Statements
This press release contains “forward-looking” statements within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements that are based on the Company’s current
expectations or forecasts of future events, rather than past events
and outcomes, and such statements are not guarantees of future
performance. Forward-looking statements include all statements
other than statements of historical fact contained in this
presentation, including information or predictions concerning the
Company’s future business, results of operations, financial
performance, plans and objectives, competitive position, market
trends, and potential growth and market opportunities. In some
cases, you can identify forward-looking statements by words such as
“intends,” “estimates,” “predicts,” “potential,” “continues,”
“anticipates,” “plans,” “expects,” “believes,” “should,” “could,”
“may,” “will,” “targets,” “projects,” “seeks” or the negative of
these terms or other comparable terminology.
Forward-looking statements are subject to risks, uncertainties
and assumptions, which may cause the Company’s actual results,
performance or achievements to be materially different from those
expressed or implied by such forward-looking statements. Key
factors that could cause the Company’s actual results to be
different than expected or anticipated include, but are not limited
to: our goals and strategies; our future business development,
financial condition and results of operations; our ability to
continue operating our fabrication facilities at full capacity; our
ability to appropriately respond to changing technologies on a
timely and cost-effective basis; our customer relationships and our
ability to retain and expand our customer relationships; our
ability to accurately predict our future revenues for the purpose
of appropriately budgeting and adjusting our expenses; our
expectations regarding dependence on our largest customers; our
ability to diversify our customer base and develop relationships in
new markets; the performance and reliability of our third-party
suppliers and manufacturers; our ability to procure tools,
materials, and chemicals; our ability to control costs, including
our operating and capital expenses; the size and growth potential
of the markets for our solutions, and our ability to serve and
expand our presence in those markets; the level of demand in our
customers’ end markets; our ability to attract, train and retain
key qualified personnel in a competitive labor market; adverse
litigation judgments, settlements or other litigation-related
costs; changes in trade policies, including the imposition of
tariffs; our ability to raise additional capital or financing; our
ability to accurately forecast demand; the level and timing of U.S.
government program funding; our ability to maintain compliance with
certain U.S. government contracting requirements; regulatory
developments in the United States and foreign countries; our
ability to protect our intellectual property rights; our ability to
meet our long-term growth targets; and other factors discussed in
the “Risk Factors” section of the annual report on Form 10-K the
Company filed with the SEC on March 15, 2023 and in other documents
that the Company files with the SEC, which are available at
http://www.sec.gov. The Company assumes no obligation to update any
forward-looking statements, which speak only as of the date of this
press release.
SKYWATER TECHNOLOGY,
INC.
Consolidated Balance
Sheets
(Unaudited)
December 31, 2023
January 1, 2023
(in thousands, except share
data)
Assets
Current assets
Cash and cash equivalents
$
18,382
$
30,025
Accounts receivable (net of allowance for
credit losses of $180 and $1,638, respectively)
65,961
28,045
Contract assets (net of allowance for
credit losses of $99 and $0, respectively)
29,666
34,625
Inventory
15,341
13,397
Prepaid expenses and other current
assets
16,853
10,290
Income tax receivable
172
169
Total current assets
146,375
116,551
Property and equipment, net
159,367
179,915
Intangible assets, net
5,672
5,608
Other assets
5,342
3,690
Total assets
$
316,756
$
305,764
Liabilities and shareholders’
equity
Current liabilities
Current portion of long-term debt
$
3,976
$
1,855
Accounts payable
19,614
21,102
Accrued expenses
48,291
25,212
Short-term financing, net of unamortized
debt issuance costs
22,765
55,817
Contract liabilities
49,551
28,186
Total current liabilities
144,197
132,172
Long-term liabilities
Long-term debt, less current portion and
net of unamortized debt issuance costs
36,098
35,181
Long-term incentive plan
—
1,643
Long-term contract liabilities
65,754
67,967
Deferred income tax liability, net
679
1,239
Other long-term liabilities
9,327
13,585
Total long-term liabilities
111,858
119,615
Total liabilities
256,055
251,787
Shareholders’ equity
Preferred stock, $0.01 par value per share
(80,000,000 shares authorized, zero shares issued and outstanding
as of December 31, 2023 and January 1, 2023)
—
—
Common stock, $0.01 par value per share
(200,000,000 shares authorized; 47,028,159 and 43,704,876 shares
issued and outstanding as of December 31, 2023 and January 1, 2023,
respectively)
470
437
Additional paid-in capital
178,473
147,304
Accumulated deficit
(125,203
)
(94,072
)
Total shareholders’ equity, SkyWater
Technology, Inc.
53,740
53,669
Noncontrolling interests
6,961
308
Total shareholders’ equity
60,701
53,977
Total liabilities and shareholders’
equity
$
316,756
$
305,764
SKYWATER TECHNOLOGY,
INC.
Consolidated Statements of
Operations
(Unaudited)
Three-Month Period
Ended
Fiscal Year Ended
December 31, 2023
October 1, 2023
January 1, 2023
December 31, 2023
January 1, 2023
(in thousands, except share
data)
Revenue
$
79,154
$
71,624
$
65,087
$
286,682
$
212,941
Cost of revenue
67,143
57,477
48,536
227,390
186,974
Gross profit
12,011
14,147
16,551
59,292
25,967
Research and development expense
2,872
2,233
2,208
10,169
9,431
Selling, general, and administrative
expense
15,092
16,105
13,040
63,911
46,303
Operating (loss) income
(5,953
)
(4,191
)
1,303
(14,788
)
(29,767
)
Other expense
Loss on debt extinguishment
—
—
(1,101
)
—
(1,101
)
Interest expense
(2,898
)
(2,507
)
(1,794
)
(10,826
)
(5,194
)
Total other expense
(2,898
)
(2,507
)
(2,895
)
(10,826
)
(6,295
)
Loss before income taxes
(8,851
)
(6,698
)
(1,592
)
(25,614
)
(36,062
)
Income tax (benefit) expense
(450
)
(96
)
852
(521
)
809
Net loss
(8,401
)
(6,602
)
(2,444
)
(25,093
)
(36,871
)
Less: net income attributable to
noncontrolling interests
1,924
966
597
5,663
2,722
Net loss attributable to SkyWater
Technology, Inc.
$
(10,325
)
$
(7,568
)
$
(3,041
)
$
(30,756
)
$
(39,593
)
Net loss per share attributable to common
shareholders, basic and diluted
$
(0.22
)
$
(0.16
)
$
(0.07
)
$
(0.68
)
$
(0.97
)
Weighted average shares used in computing
net loss per common share, basic and diluted
47,020,395
46,445,309
42,612,763
45,506,598
40,835,186
SKYWATER TECHNOLOGY,
INC.
Consolidated Statements of
Cash Flows
(Unaudited)
Fiscal Year Ended
December 31, 2023
January 1, 2023
(in thousands)
Cash flows from operating activities
Net loss
$
(25,093
)
$
(36,871
)
Adjustments to reconcile net loss to net
cash flows provided by (used in) operating activities
Depreciation and amortization
28,930
28,192
Gain on sale of property and equipment
—
(3
)
Write-off of capital projects in
process
1,262
—
Amortization of debt issuance costs
included in interest expense
1,755
909
Long-term incentive and equity-based
compensation
6,860
8,610
Cash paid for contingent consideration in
excess of initial valuation
—
(816
)
Deferred income taxes
(560
)
244
Cash paid for operating leases
(49
)
(49
)
Cash paid for interest on finance
leases
(848
)
(757
)
Provision for credit losses
38
1,638
Loss on debt extinguishment
—
1,101
Changes in operating assets and
liabilities
Accounts receivable and contract
assets
(33,371
)
(11,596
)
Inventories
(1,944
)
(9,225
)
Prepaid expenses and other assets
(8,218
)
(5,288
)
Accounts payable and accrued expenses
22,296
21,787
Contract liabilities, current and
long-term
19,152
(12,749
)
Income tax receivable and payable
(3
)
576
Net cash provided by (used in) operating
activities
10,207
(14,297
)
Cash flows from investing activities
Purchase of software and licenses
(1,871
)
(400
)
Purchases of property and equipment
(8,618
)
(17,053
)
Net cash used in investing activities
(10,489
)
(17,453
)
Cash flows from financing activities
Draws on revolving line of credit
259,350
63,006
Paydowns of revolving line of credit
(297,649
)
—
Net repayment on Revolver
—
(26,220
)
Proceeds from tool financings
9,012
—
Principal payments on long-term debt
(2,482
)
(1,224
)
Cash paid for debt issuance costs
—
(4,168
)
Proceeds from the issuance of common stock
in secondary offering
—
16,168
Cash paid for offering costs
—
(456
)
Cash paid for principal on finance
leases
(935
)
(1,603
)
Proceeds from the issuance of common stock
pursuant to equity compensation plans
2,305
1,800
Proceeds from the issuance of common stock
under the ATM
20,398
3,919
Cash paid on licensed technology
obligations
(2,350
)
(1,150
)
Net contributions (distributions) from
(to) noncontrolling interest
990
(1,214
)
Net cash (used in) provided by financing
activities
(11,361
)
48,858
Net change in cash and cash
equivalents
(11,643
)
17,108
Cash and cash equivalents - beginning of
period
30,025
12,917
Cash and cash equivalents - end of
period
$
18,382
$
30,025
Supplemental Financial Information by Quarter
Q4 2023
Q3 2023
Q2 2023
Q1 2023
Q4 2022
Q3 2022
Q2 2022
Q1 2022
(in thousands)
ATS development revenue (1)
$
57,170
$
53,891
$
52,073
$
47,770
$
47,846
$
34,953
$
29,510
$
25,591
Tool revenue (2)
9,936
3,243
936
536
30
219
313
984
Total ATS revenue
$
67,106
$
57,134
$
53,009
$
48,306
$
47,876
$
35,172
$
29,823
$
26,575
Wafer Services revenue
12,048
14,490
16,802
17,788
17,211
17,154
17,584
21,546
Total revenue
$
79,154
$
71,624
$
69,811
$
66,094
$
65,087
$
52,326
$
47,407
$
48,121
Tool revenue (2)
$
9,936
$
3,243
$
936
$
536
$
30
$
219
$
313
$
984
Tool cost of revenue (2)
9,125
2,861
290
484
46
152
200
984
Tool gross profit (loss)
$
811
$
382
$
646
$
52
$
(16
)
$
67
$
113
$
—
Revenue impact of modified customer
contracts
$
—
$
—
$
3,601
$
—
$
4,685
$
—
$
—
$
8,230
Cost of revenue impact of modified
customer contracts
—
—
—
—
—
—
—
10,887
Gross profit (loss) impact of modified
customer contracts
$
—
$
—
$
3,601
$
—
$
4,685
$
—
$
—
$
(2,657
)
__________________
(1)
ATS development revenue represents GAAP revenue primarily
derived from process development services, tool installation and
qualification services, facility and tool access, and security
services.
(2)
Tool revenue and cost of tool revenue primarily represent GAAP
amounts that arise from the purchase of equipment for our
customers. This equipment is used to complete ATS customer
programs.
Non-GAAP Financial Measures
We provide supplemental, non-GAAP financial information that our
management regularly evaluates to provide additional insight to
investors as supplemental information to our results reported using
U.S. generally accepted accounting principles (GAAP). We provide
non-GAAP gross profit, non-GAAP gross margin, non-GAAP net loss to
shareholders, and non-GAAP net loss to shareholders per share. Our
management uses these non-GAAP financial measures to make informed
operating decisions, complete strategic planning, prepare annual
budgets, and evaluate Company and management performance. We
believe these non-GAAP financial measures are useful performance
measures to our investors because they provide a baseline for
analyzing trends in our business and exclude certain items that may
not be indicative of our core operating results. The non-GAAP
financial measures disclosed in this earnings press release should
not be viewed as an alternative to, or more meaningful than, the
reported results prepared in accordance with GAAP. In addition,
because these non-GAAP financial measures are not determined in
accordance with GAAP, other companies, including our peers, may
calculate their non-GAAP financial measures differently than we do.
As a result, the non-GAAP financial measures presented in this
earnings press release may not be directly comparable to similarly
titled measures presented by other companies.
We also provide adjusted earnings before interest, income taxes,
depreciation and amortization (EBITDA) and adjusted EBITDA margin
as supplemental non-GAAP measures. We define adjusted EBITDA as net
(loss) income before net interest expense, income tax (benefit)
expense, depreciation and amortization, equity-based compensation
and certain other items that we do not view as indicative of our
ongoing performance, including net income attributable to
noncontrolling interests, business transformation costs, CHIPS Act
specialist fees, management transition expense, SkyWater Florida
start-up costs, and restructuring costs. Our management uses
adjusted EBITDA and adjusted EBITDA margin to make informed
operating decisions, complete strategic planning, prepare annual
budgets, and evaluate Company and management performance. We
believe adjusted EBITDA is a useful performance measure to our
investors because it allows for an effective evaluation of our
operating performance when compared to other companies, including
our peers, without regard to financing methods or capital
structures. We exclude the items listed above from net income or
loss in arriving at adjusted EBITDA because the amounts of these
items can vary substantially within our industry depending on the
accounting methods and policies used, book values of assets,
capital structures, and the methods by which assets were acquired.
Adjusted EBITDA should not be considered as an alternative to, or
more meaningful than, net (loss) income determined in accordance
with GAAP. Certain items excluded from adjusted EBITDA are
significant components in understanding and assessing a company’s
financial performance, such as a company’s cost of capital and tax
structure, as well as the historic cost bases of depreciable
assets, none of which are reflected in adjusted EBITDA. Our
presentation of adjusted EBITDA should not be construed as an
indication that our results will be unaffected by the items
excluded from adjusted EBITDA. In future fiscal periods, we may
exclude such items and may incur income and expenses similar to
these excluded items. Accordingly, the exclusion of these items and
other similar items in our non-GAAP financial measures should not
be interpreted as implying that these items are non-recurring,
infrequent or unusual, unless otherwise expressly indicated.
We continuously evaluate the non-GAAP financial measures we use,
the manner in which non-GAAP financial measures are calculated, and
the adjustments we make to GAAP results to derive our non-GAAP
financial measures. In the third quarter of 2023, we made the
following changes to our non-GAAP financial measures and revised
prior period non-GAAP financial measures to conform the calculation
of non-GAAP financial measures across all periods and provide
comparability:
- Tool sales have historically been infrequent and viewed by
management as secondary to ATS development programs. Accordingly,
prior to the third quarter of 2023, we excluded the margin on tool
sales when calculating non-GAAP gross profit, non-GAAP gross
margin, non-GAAP earnings to shareholders and non-GAAP earnings to
shareholders per basic share. Recently, our ATS customers have
increasingly contracted with us to purchase tools on their behalf
and we expect this trend to continue going forward. Accordingly, we
no longer believe tool sales are infrequent and therefore do not
exclude the impact of tool revenue and tool cost of revenue in the
calculation of our non-GAAP financial measures.
- Since the second quarter of 2023, we have incurred expenses
related to long-term transformation activities focused on
improvement in automation and operational efficiency. Prior to the
fourth quarter of 2023, these expenses consisted of project-based
consulting fees; however, in the fourth quarter of 2023, the
write-off of abandoned software assets associated with our business
transformation activities is also included. Similarly, we have also
incurred project-based specialist fees associated with our CHIPS
Act application. Neither of these types of fees are required to run
our business and, therefore, are incremental to our ongoing
operations and are not a normal operating expense. Beginning in the
third quarter of 2023, we began excluding these fees in the
calculation of non-GAAP earnings, non-GAAP earnings to shareholders
per share, and adjusted EBITDA.
The following tables present a reconciliation of the most
directly comparable financial measures, calculated and presented in
accordance with GAAP, to our non-GAAP financial measures.
SKYWATER TECHNOLOGY,
INC.
Reconciliation of GAAP to
Non-GAAP Financial Measures
(Unaudited)
Three-Month Period
Ended
Fiscal Year Ended
December 31, 2023
October 1, 2023
January 1, 2023
(Revised)
December 31, 2023
January 1, 2023
(Revised)
(in thousands)
GAAP revenue
$
79,154
$
71,624
$
65,087
$
286,682
$
212,941
GAAP cost of revenue
$
67,143
$
57,477
$
48,536
$
227,390
$
186,974
Equity-based compensation (1)
(313
)
(438
)
(452
)
(1,555
)
(2,578
)
SkyWater Florida start-up costs (2)
—
—
(14
)
—
(582
)
Restructuring costs (3)
(679
)
—
—
(679
)
—
Business transformation costs (4)
(806
)
—
—
(806
)
—
Management transition expense (5)
—
—
—
(705
)
—
Non-GAAP cost of revenue
$
65,345
$
57,039
$
48,070
$
223,645
$
183,814
GAAP gross profit
$
12,011
$
14,147
$
16,551
$
59,292
$
25,967
GAAP gross margin
15.2
%
19.8
%
25.4
%
20.7
%
12.2
%
Equity-based compensation (1)
$
313
$
438
$
452
$
1,555
$
2,578
SkyWater Florida start-up costs (2)
—
—
14
—
582
Restructuring costs (3)
679
—
—
679
—
Business transformation costs (4)
806
—
—
806
—
Management transition expense (5)
—
—
—
705
—
Non-GAAP gross profit
$
13,809
$
14,585
$
17,017
$
63,037
$
29,127
Non-GAAP gross margin
17.4
%
20.4
%
26.1
%
22.0
%
13.7
%
GAAP research and development expense
$
2,872
$
2,233
$
2,208
$
10,169
$
9,431
Equity-based compensation (1)
134
(218
)
(126
)
(464
)
(596
)
Restructuring costs (3)
(655
)
—
—
(655
)
—
Non-GAAP research and development
expense
$
2,351
$
2,015
$
2,082
$
9,050
$
8,835
GAAP selling, general, and administrative
expense
$
15,092
$
16,105
$
13,040
$
63,911
$
46,303
Equity-based compensation (1)
(1,008
)
(1,197
)
(995
)
(4,841
)
(5,432
)
SkyWater Florida start-up costs (2)
—
—
2
—
(104
)
Restructuring costs (3)
(587
)
—
—
(587
)
—
Business transformation costs (4)
(5,341
)
(3,522
)
—
(11,363
)
—
Management transition expense (5)
—
—
—
(130
)
—
CHIPS Act specialist fees (6)
—
—
—
(1,320
)
—
Non-GAAP selling, general, and
administrative expense
$
8,156
$
11,386
$
12,047
$
45,670
$
40,767
Three-Month Period
Ended
Fiscal Year Ended
December 31, 2023
October 1, 2023
January 1, 2023
(Revised)
December 31, 2023
January 1, 2023
(Revised)
(in thousands)
GAAP net loss to shareholders
$
(10,325
)
$
(7,568
)
$
(3,041
)
$
(30,756
)
$
(39,593
)
Equity-based compensation (1)
1,187
1,853
1,573
6,860
8,606
SkyWater Florida start-up costs (2)
—
—
12
—
686
Restructuring costs (3)
1,921
—
—
1,921
—
Business transformation costs (4)
6,147
3,522
—
12,169
—
Management transition expense (5)
—
—
—
835
—
CHIPS Act specialist fees (6)
—
—
—
1,320
—
Non-GAAP net loss to shareholders
$
(1,070
)
$
(2,193
)
$
(1,456
)
$
(7,651
)
$
(30,301
)
Equity-based compensation allocation in
the consolidated statements of operations (1):
Cost of revenue
$
313
$
438
$
452
$
1,555
$
2,578
Research and development expense
(134
)
218
126
464
596
Selling, general, and administrative
expense
1,008
1,197
995
4,841
5,432
$
1,187
$
1,853
$
1,573
$
6,860
$
8,606
SkyWater Florida start-up costs allocation
in the consolidated statements of operations (2):
Cost of revenue
$
—
$
—
$
14
$
—
$
582
Selling, general and administrative
expenses
—
—
(2
)
—
104
$
—
$
—
$
12
$
—
$
686
Restructuring costs allocation in the
consolidated statements of operations (3):
Cost of revenue
$
679
$
—
$
—
$
679
$
—
Research and development expense
655
—
—
655
—
Selling, general, and administrative
expense
587
—
—
587
—
$
1,921
$
—
$
—
$
1,921
$
—
Business transformation costs allocation
in the consolidated statements of operations (4):
Cost of revenue
$
806
$
—
$
—
$
806
$
—
Selling, general, and administrative
expense
5,341
3,522
—
11,363
—
$
6,147
$
3,522
$
—
$
12,169
$
—
Management transition expense allocation
in the consolidated statements of operations (5):
Cost of revenue
$
—
$
—
$
—
$
705
$
—
Selling, general, and administrative
expense
—
—
—
130
—
$
—
$
—
$
—
$
835
$
—
Three-Month Period
Ended
December 31, 2023
Fiscal Year Ended
December 31, 2023
GAAP
Non-GAAP
GAAP
Non-GAAP
Computation of net loss per common share,
basic and diluted:
(in thousands, except per
share data)
Numerator:
Net loss attributable to SkyWater
Technology, Inc.
$
(10,325
)
$
(1,070
)
$
(30,756
)
$
(7,651
)
Denominator:
Weighted-average common shares
outstanding, basic and diluted
47,020
47,020
45,507
45,507
Net loss per common share, basic and
diluted
$
(0.22
)
$
(0.02
)
$
(0.68
)
$
(0.17
)
Three-Month Period
Ended
October 1, 2023
GAAP
Non-GAAP
Computation of net loss per common share,
basic and diluted:
(in thousands, except per
share data)
Numerator:
Net loss attributable to SkyWater
Technology, Inc.
$
(7,568
)
$
(2,193
)
Denominator:
Weighted-average common shares
outstanding, basic and diluted
46,445
46,445
Net loss per common share, basic and
diluted
$
(0.16
)
$
(0.05
)
Three-Month Period
Ended
January 1, 2023
Fiscal Year Ended
January 1, 2023
GAAP
Non-GAAP
GAAP
Non-GAAP
Computation of net loss per common share,
basic and diluted:
(in thousands, except per
share data)
Numerator:
Net loss attributable to SkyWater
Technology, Inc.
$
(3,041
)
$
(1,456
)
$
(39,593
)
$
(30,301
)
Denominator:
Weighted-average common shares
outstanding, basic and diluted
42,613
42,613
40,835
40,835
Net loss per common share, basic and
diluted
$
(0.07
)
$
(0.03
)
$
(0.97
)
$
(0.74
)
Three-Month Period
Ended
Fiscal Year Ended
December 31, 2023
October 1, 2023
January 1, 2023
December 31, 2023
January 1, 2023
(in thousands)
Net loss to shareholders (GAAP)
$
(10,325
)
$
(7,568
)
$
(3,041
)
$
(30,756
)
$
(39,593
)
Net loss margin to shareholders
(13.0
)%
(10.6
)%
(4.7
)%
(10.7
)%
(18.6
)%
Interest expense (8)
$
2,898
$
2,507
$
2,895
$
10,826
$
6,295
Income tax (benefit) expense
(450
)
(96
)
852
(521
)
809
Depreciation and amortization
7,279
7,092
7,451
28,930
28,192
EBITDA
(598
)
1,935
8,157
8,479
(4,297
)
Equity-based compensation (1)
1,187
1,853
1,573
6,860
8,606
SkyWater Florida start-up costs (2)
—
—
12
—
686
Restructuring costs (3)
1,921
—
—
1,921
—
Business transformation costs (4)
6,147
3,522
—
12,169
—
Management transition expense (5)
—
—
—
835
—
CHIPS Act specialist fees (6)
—
—
—
1,320
—
Net income attributable to noncontrolling
interests (7)
1,924
966
597
5,663
2,722
Adjusted EBITDA
$
10,581
$
8,276
$
10,339
$
37,247
$
7,717
Adjusted EBITDA margin
13.4
%
11.6
%
15.9
%
13.0
%
3.6
%
__________________
(1)
Represents non-cash equity-based
compensation expense.
(2)
Represents start-up costs
associated with our 200 mm heterogeneous integration facility in
Kissimmee, Florida, which includes legal fees, recruiting expenses,
retention awards and facility start-up expenses. These expenses are
not representative of our expected ongoing costs. Effective 2023,
our Kissimmee, Florida plant is up and running and no longer in its
start-up phase.
(3)
Represents severance and other
costs related to the reorganization of our resources.
(4)
Represents expenses related to
long-term transformation activities focused on improvement in
automation and operational efficiency and includes project-based
management consulting fees and the write-off of abandoned software
assets.
(5)
Represents severance and other
costs related to the reorganization of the manufacturing and
operations leadership team.
(6)
Represents project-based
specialist fees related to our CHIPS Act application process.
(7)
Represents net income
attributable to our VIE, which was formed for the purpose of
purchasing the land and building of our primary operating facility
in Bloomington, Minnesota. Since interest expense is added back to
net loss to shareholders in our adjusted EBITDA financial measure,
we also add back the net income attributable to the VIE as its net
income is derived from interest the VIE charges SkyWater.
(8)
Includes losses related to the
extinguishment of our revolving credit agreement in 2022.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240226488023/en/
SkyWater Investor Contact: Claire McAdams |
claire@headgatepartners.com SkyWater Media Contact: Lauri Julian |
Media@SkyWaterTechnology.com
Grafico Azioni SkyWater Technology (NASDAQ:SKYT)
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Da Dic 2024 a Gen 2025
Grafico Azioni SkyWater Technology (NASDAQ:SKYT)
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