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--Achieved Key Distributed Generation and Utility-Scale Milestones--
--US Manufacturing Initiative Approaching Key Site Selection and Financing Milestones--
SINGAPORE, Nov. 10, 2022 /PRNewswire/ -- Maxeon Solar Technologies, Ltd. (NASDAQ: MAXN) ("Maxeon" or "the Company"), a global leader in solar innovation and channels, today announced its financial results for the third quarter ended October 2, 2022.
Maxeon's Interim Chief Executive Officer Mark Babcock noted, "Maxeon delivered Q3 financial results consistent with guidance and achieved key strategic milestones in both our distributed generation (DG) and utility-scale businesses. In Europe, DG posted another record quarter for volume, revenue and beyond the panel product contributions. These factors drove improved financial results for the Company overall, and the business trajectory is expected to facilitate overall break-even gross margins in the fourth quarter. The DG business also executed on strategic expansion initiatives in the United States which are expected to help Maxeon achieve overall profitability next year. Specifically, we secured the first bookings with our new residential partner Greentech Renewables."
Commenting on the utility-scale business, Babcock added, "The North America Utility-Scale business continues to expand shipment volume with multiple daily deliveries from Mexico to our customers in the United States, and our Malaysian PERC cell fab has now ramped to over one gigawatt of capacity. We are confident that the completion of our full capacity ramp in 2023 and the transition to our higher ASP contracted backlog will meaningfully improve the profitability of this business."
Babcock continued, "Our teams are executing well and we are excited by the trajectory toward achievement of our Long-Term Financial Model within 2023. As our line of sight on this transformation becomes clearer, we are accelerating major growth initiatives for 2024 to 2026 topline growth and EBITDA expansion. In DG, we are expecting to ship our first storage units next quarter. In utility-scale, we're approaching key site selection and DOE Loan Guarantee Program Office milestones for our proposed 3 gigawatt U.S. cell and module facility. In Summary, we believe we are in an excellent position to continue our growth trajectory beyond 2023.
Selected Q3 Unaudited Financial Summary | |||||
(In thousands, except shipments) | Fiscal Q3 2022 | Fiscal Q2 2022 | Fiscal Q3 2021 | ||
Shipments, in MW | 605 | 521 | 566 | ||
Revenue | $ 275,449 | $ 238,080 | $ 220,488 | ||
Gross loss(1) | (15,747) | (39,324) | (16,708) | ||
GAAP Operating expenses | 41,196 | 35,701 | 32,639 | ||
GAAP Net loss attributable to the stockholders(1) | (44,691) | (87,920) | (65,363) | ||
Capital expenditures | 16,110 | 18,231 | 54,140 | ||
Other Financial Data(1), (2) | |||||
(In thousands) | Fiscal Q3 2022 | Fiscal Q2 2022 | Fiscal Q3 2021 | ||
Non-GAAP Gross loss | $ (15,492) | $ (23,905) | $ (16,353) | ||
Non-GAAP Operating expenses | 34,651 | 30,162 | 29,678 | ||
Adjusted EBITDA(3) | (34,501) | (36,833) | (36,991) |
(1) | The Company's GAAP and Non-GAAP results were impacted by the effects of certain items. Refer to "Supplementary information affecting GAAP and Non-GAAP results" below. |
(2) | The Company's use of Non-GAAP financial information, including a reconciliation to U.S. GAAP, is provided under "Use of Non-GAAP Financial Measures" below. |
(3) | The Adjusted EBITDA for three months ended October 3, 2021 did not contain an adjustment for equity in losses of unconsolidated investees and related gain on such equity investment. For a reconciliation of Adjusted EBITDA to GAAP Net Loss for the three months ended October 3, 2021, please refer to our Forms 6-K furnished with the SEC on November 17, 2021. |
Supplementary information affecting GAAP and Non-GAAP results | ||||||
Three Months Ended | ||||||
(In thousands) | Financial | October 2, 2022 | July 3, 2022 | October 3, 2021 | ||
Incremental cost of above market | Cost of revenue | 603 | 3,308 | 11,490 | ||
Loss on ancillary sales of excess | Cost of revenue | — | — | 7,425 |
(1) | Relates to the difference between our contractual cost for the polysilicon under the long-term fixed supply agreements with our supplier which is ending in January 2023 and the price of polysilicon available in the market as derived from publicly available information at the beginning of each quarter, multiplied by the volume of modules sold within the quarter. |
(2) | In order to reduce inventory and improve working capital, we have periodically elected to sell polysilicon inventory procured under the long-term fixed supply agreements in the market at prices below our purchase price, thereby incurring a loss. As the sales were committed during the three months ended April 4, 2022, the loss on firm purchase commitment in connection to the ancillary sales to be delivered in subsequent quarters was provided then. |
Fourth Quarter 2022 Outlook
For the fourth quarter of 2022, the Company anticipates the following results:
(In millions, except shipments) | Outlook |
Shipments, in MW | 680 - 720 MW |
Revenue | $290 - $330 |
Gross (loss) profit(1) | $(1) - $9 |
Non-GAAP gross profit(1), (2) | $0 - $10 |
Operating expenses | $41 ± $2 |
Non-GAAP operating expenses(3) | $36± $2 |
Adjusted EBITDA(1), (4) | $(17) - $(27) |
Capital expenditures(5) | $16 - $20 |
Out-of-market polysilicon cost(1) | $1 |
(1) | Outlook for Gross (loss) profit, Non-GAAP gross profit and Adjusted EBITDA includes out-of-market polysilicon cost. |
(2) | The Company's Non-GAAP gross profit is impacted by the effects of adjusting for stock-based compensation expense. |
(3) | The Company's Non-GAAP operating expenses are impacted by the effects of adjusting for stock-based compensation expense and restructuring charges and fees. |
(4) | The Company cannot provide a reconciliation between its Adjusted EBITDA projection and the most directly comparable GAAP measures without unreasonable efforts because it is unable to predict with reasonable certainty the ultimate outcome of the remeasurement gain or loss of the prepaid forward and the equity in gain or loss of unconsolidated investees. |
(5) | Capital expenditures are directed mainly to upgrading production to Maxeon 6 in our Malaysia factory, the purchase of cell and module equipment for our 1.8 GW of Performance line capacity for the U.S., as well as developing Maxeon 7 technology and operating a pilot line. We are evaluating our Maxeon 7 capacity growth plan, and because of that our previous capex indication for retrofitting Maxeon 3 production lines is no longer relevant. |
These anticipated results for the fourth quarter of 2022 are preliminary, unaudited and represent the most current information available to management. The Company's business outlook is based on management's current views and estimates with respect to market conditions, production capacity, the uncertainty of the continuing impact of the COVID-19 pandemic, and the global economic environment. Please refer to Forward Looking Statements section below. Management's views and estimates are subject to change without notice.
For more information
Maxeon's third quarter 2022 financial results and management commentary can be found on Form 6-K by accessing the Financials & Filings page of the Investor Relations section of Maxeon's website at: https://corp.maxeon.com/investor-relations. The Form 6-K and Company's other filings are also available online from the Securities and Exchange Commission at www.sec.gov.
Conference Call Details
The Company will hold a conference call on November 10, 2022, at 5:00 PM U.S. ET / November 11, 2022, at 6:00 AM Singapore Time, to discuss results and to provide an update on the business.
To join the live conference call, participants must first register here, where a dial-in number will be provided.
A simultaneous webcast of the conference call will be available on Maxeon's website at https://corp.maxeon.com/events-and-presentations. A webcast replay will be available on Maxeon's website for one year at https://corp.maxeon.com/events-and-presentations.
About Maxeon Solar Technologies
Maxeon Solar Technologies Ltd (NASDAQ: MAXN) is Powering Positive Change™. Headquartered in Singapore, Maxeon designs and manufactures Maxeon® and SunPower® brand solar panels, and has sales operations in more than 100 countries, operating under the SunPower brand in certain countries outside the United States. The Company is a leader in solar innovation with access to over 1,000 patents and two best-in-class solar panel product lines. Maxeon products span the global rooftop and solar power plant markets through a network of more than 1,700 trusted partners and distributors. A pioneer in sustainable solar manufacturing, Maxeon leverages a +35-year history in the solar industry and numerous awards for its technology. For more information about how Maxeon is Powering Positive Change™ visit us at https://www.maxeon.com/, on LinkedIn and on Twitter @maxeonsolar.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, but not limited to, statements regarding: (a) our expectations regarding pricing trends, demand and growth projections; (b) potential disruptions to our operations and supply chain that may result from epidemics, natural disasters or military conflicts, including the duration, scope and impact on the demand for our products, market disruptions from the war in Ukraine and the pace of recovery from the COVID-19 pandemic; (c) anticipated product launch timing and our expectations regarding ramp, customer acceptance and demand, upsell and expansion opportunities; (d) our expectations and plans for short- and long-term strategy, including our anticipated areas of focus and investment, market expansion, product and technology focus, and projected growth and profitability; (e) our ability to meet short term and long term material cash requirements including our obligations under the long-term polysilicon supply agreement, our ability to complete an equity or debt offering or financing at favorable terms, if at all, and our overall liquidity, substantial indebtedness and ability to obtain additional financing; (f) our technology outlook, including anticipated fab utilization and expected ramp and production timelines for the Company's Maxeon 5 and 6, next-generation Maxeon 7 and Performance line solar panels, expected cost reductions, and future performance; (g) our strategic goals and plans, including partnership discussions with respect to the Company's next-generation technology, and our relationships with existing customers, suppliers and partners, and our ability to achieve and maintain them; (h) our expectations regarding our future performance and revenues resulting from contracted orders, bookings, backlog, and pipelines in our sales channels; (i) our fourth quarter fiscal year 2022 guidance, including shipments, revenue, gross profit, non-GAAP gross profit, operating expenses, non-GAAP operating expenses, Adjusted EBITDA, capital expenditures, out-of-market polysilicon cost, and related assumptions; and (j) our projected effective tax rate and changes to the valuation allowance related to our deferred tax assets.
The forward-looking statements can be also identified by terminology such as "may," "might," "could," "will," "aims," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the quotations from management in this press release and Maxeon's operations and business outlook contain forward-looking statements.
These forward-looking statements are based on our current assumptions, expectations and beliefs and involve substantial risks and uncertainties that may cause results, performance or achievement to materially differ from those expressed or implied by these forward-looking statements. These statements are not guarantees of future performance and are subject to a number of risks. The reader should not place undue reliance on these forward-looking statements, as there can be no assurances that the plans, initiatives or expectations upon which they are based will occur. Factors that could cause or contribute to such differences include, but are not limited to: (1) challenges in executing transactions key to our strategic plans, including regulatory and other challenges that may arise; (2) our liquidity, substantial indebtedness, terms and conditions upon which our indebtedness is incurred and ability to obtain additional financing for our projects, customers and operations; (3) our ability to manage supply chain cost increases and operating expenses; (4) potential disruptions to our operations and supply chain that may result from damage or destruction of facilities operated by our suppliers, difficulties in hiring or retaining key personnel, epidemics, natural disasters, including impacts of the COVID-19 pandemic, or the war in Ukraine; (5) our ability to manage our key customers and suppliers; (6) the success of our ongoing research and development efforts and our ability to commercialize new products and services, including products and services developed through strategic partnerships; (7) competition in the solar and general energy industry and downward pressure on selling prices and wholesale energy pricing, including impacts of inflation, economic recession and foreign exchange rates upon customer demand; (8) changes in regulation and public policy, including the imposition and applicability of tariffs; (9) our ability to comply with various tax holiday requirements as well as regulatory changes or findings affecting the availability of economic incentives promoting use of solar energy and availability of tax incentives or imposition of tax duties; (10) fluctuations in our operating results and in the foreign currencies in which we operate; (11) appropriately sizing, or delays in expanding, our manufacturing capacity and containing manufacturing and logistics difficulties that could arise; (12) unanticipated impact to customer demand and sales schedules due, among other factors, to the spread of COVID-19, the war in Ukraine, economic recession and environmental disasters; (13) challenges managing our acquisitions, joint ventures and partnerships, including our ability to successfully manage acquired assets and supplier relationships; (14) reaction by securities or industry analysts to our quarterly guidance which, in combination with our results of operations, may cause them to cease publishing research or reports about us, or adversely change their recommendations regarding our ordinary shares, which may negatively impact the market price of our ordinary shares and volume of our stock trading; and (15) unpredictable outcomes resulting from our litigation activities or other disputes. A detailed discussion of these factors and other risks that affect our business is included in filings we make with the Securities and Exchange Commission ("SEC") from time to time, including our most recent report on Form 20-F, particularly under the heading "Risk Factors". Copies of these filings are available online from the SEC at www.sec.gov, or on the SEC Filings section of our Investor Relations website at https://corp.maxeon.com/investor-relations. All forward-looking statements in this press release are based on information currently available to us, and we assume no obligation to update these forward-looking statements in light of new information or future events.
Use of Non-GAAP Financial Measures
We present certain non-GAAP measures such as non-GAAP gross loss, non-GAAP operating expenses and earnings before interest, taxes, depreciation and amortization ("EBITDA") adjusted for stock-based compensation, restructuring charges and fees, remeasurement loss on prepaid forward and physical delivery forward, loss on extinguishment of debt, impairment and equity in losses of unconsolidated investees ("Adjusted EBITDA") to supplement our consolidated financial results presented in accordance with GAAP. Non-GAAP gross loss is defined as gross loss excluding stock-based compensation. Non-GAAP operating expenses is defined as operating expenses excluding stock-based compensation and restructuring charges and fees.
We believe that non-GAAP gross loss, non-GAAP operating expenses and Adjusted EBITDA provide greater transparency into management's view and assessment of the Company's ongoing operating performance by removing items management believes are not representative of our continuing operations and may distort our longer-term operating trends. We believe these measures are useful to help enhance the comparability of our results of operations across different reporting periods on a consistent basis and with our competitors, distinct from items that are infrequent or not associated with the Company's core operations as presented above. We also use these non-GAAP measures internally to assess our business, financial performance and current and historical results, as well as for strategic decision-making and forecasting future results. Given our use of non-GAAP measures, we believe that these measures may be important to investors in understanding our operating results as seen through the eyes of management. These non-GAAP measures are neither prepared in accordance with GAAP nor are they intended to be a replacement for GAAP financial data, should be reviewed together with GAAP measures and may be different from non-GAAP measures used by other companies.
As presented in the "Reconciliation of Non-GAAP Financial Measures" section, each of the non-GAAP financial measures excludes one or more of the following items in arriving to the non-GAAP measures:
Reconciliation of Non-GAAP Financial Measures | |||||
Three Months Ended | |||||
(In thousands) | October 2, 2022 | July 3, 2022 | October 3, 2021 | ||
Gross loss | $ (15,747) | $ (39,324) | $ (16,708) | ||
Stock-based compensation | 255 | 249 | 355 | ||
Loss related to settlement of price escalation dispute | — | 15,170 | — | ||
Non-GAAP Gross loss | (15,492) | (23,905) | (16,353) | ||
GAAP Operating expenses | 41,196 | 35,701 | 32,639 | ||
Stock-based compensation | (5,918) | (1,896) | (1,447) | ||
Restructuring charges and fees | (627) | (3,643) | (1,514) | ||
Non-GAAP Operating expenses | 34,651 | 30,162 | 29,678 | ||
GAAP Net loss attributable to the stockholders | (44,691) | (87,920) | (65,363) | ||
Interest expense, net | 8,035 | 5,685 | 6,671 | ||
Provision for income taxes | 2,399 | 937 | 174 | ||
Depreciation | 13,845 | 15,305 | 10,999 | ||
Amortization | 50 | 75 | 68 | ||
EBITDA | (20,362) | (65,918) | (47,451) | ||
Stock-based compensation | 6,173 | 2,145 | 1,802 | ||
Loss related to settlement of price escalation dispute | — | 15,170 | — | ||
Restructuring charges and fees | 627 | 3,643 | 1,514 | ||
Remeasurement (gain) loss on prepaid forward | (24,521) | 3,986 | 5,961 | ||
Equity in losses (income) of unconsolidated investees and related | 3,582 | 4,141 | (3,892) | ||
Loss on extinguishment of debt(2) | — | — | 5,075 | ||
Adjusted EBITDA(1) | (34,501) | (36,833) | (36,991) |
(1) | The Adjusted EBITDA for three months ended October 3, 2021 did not contain an adjustment for equity in losses of unconsolidated investees |
(2) | The loss on extinguishment of debt relates to the loss that arose from the termination of our $50.0 million working capital facility in September |
Reconciliation of Non-GAAP Outlook | |
(In millions) | Outlook |
Gross (loss) profit | $(1) - $9 |
Stock-based compensation | 1 |
Non-GAAP gross profit | $0 - $10 |
Operating expenses | $41 ± $2 |
Stock-based compensation | (4) |
Restructuring charges and fees | (1) |
Non-GAAP operating expenses | $36± $2 |
©2022 Maxeon Solar Technologies, Ltd. All rights reserved. MAXEON is a registered trademark of Maxeon Solar Technologies, Ltd. Visit https://corp.maxeon.com/trademarks for more information.
MAXEON SOLAR TECHNOLOGIES, LTD. | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(unaudited) | |||
(In thousands, except for shares data) | |||
As of | |||
October 2, 2022 | January 2, 2022 | ||
Assets | |||
Current assets: | |||
Cash and cash equivalents | $ 199,085 | $ 166,542 | |
Short-term securities | 76,000 | — | |
Restricted short-term marketable securities | 915 | 1,079 | |
Accounts receivable, net | 58,481 | 39,730 | |
Inventories | 300,850 | 212,820 | |
Advances to suppliers, current portion | 13,869 | 51,045 | |
Prepaid expenses and other current assets | 119,794 | 61,904 | |
Total current assets | $ 768,994 | $ 533,120 | |
Property, plant and equipment, net | 385,750 | 386,630 | |
Operating lease right of use assets | 18,071 | 15,397 | |
Other intangible assets, net | 247 | 420 | |
Advances to suppliers, net of current portion | — | 716 | |
Deferred tax assets | 8,784 | 5,183 | |
Other long-term assets | 74,667 | 115,077 | |
Total assets | $ 1,256,513 | $ 1,056,543 | |
Liabilities and Equity | |||
Current liabilities: | |||
Accounts payable | $ 293,279 | $ 270,475 | |
Accrued liabilities | 89,103 | 78,680 | |
Contract liabilities, current portion | 132,745 | 44,059 | |
Short-term debt | 50,675 | 25,355 | |
Operating lease liabilities, current portion | 3,285 | 2,467 | |
Total current liabilities | $ 569,087 | $ 421,036 | |
Long-term debt | 1,750 | 213 | |
Contract liabilities, net of current portion | 98,913 | 58,994 | |
Operating lease liabilities, net of current portion | 15,083 | 13,464 | |
Convertible debt | 376,927 | 145,772 | |
Deferred tax liabilities | 7,292 | 1,150 | |
Other long-term liabilities | 56,983 | 61,039 | |
Total liabilities | $ 1,126,035 | $ 701,668 | |
Commitments and contingencies | |||
Equity: | |||
Common stock, no par value (44,996,615 and 44,246,603 issued and outstanding as of | $ — | $ — | |
Additional paid-in capital | 581,398 | 624,261 | |
Accumulated deficit | (444,562) | (262,961) | |
Accumulated other comprehensive loss | (11,996) | (11,844) | |
Equity attributable to the Company | 124,840 | 349,456 | |
Noncontrolling interests | 5,638 | 5,419 | |
Total equity | 130,478 | 354,875 | |
Total liabilities and equity | $ 1,256,513 | $ 1,056,543 |
MAXEON SOLAR TECHNOLOGIES, LTD. | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(unaudited) | |||||||
(In thousands, except per share data) | |||||||
Three Months Ended | Nine Months Ended | ||||||
October 2, 2022 | October 3, 2021 | October 2, 2022 | October 3, 2021 | ||||
Revenue | $ 275,449 | $ 220,488 | $ 736,610 | $ 561,800 | |||
Cost of revenue | 291,196 | 237,196 | 804,645 | 580,269 | |||
Gross loss | (15,747) | (16,708) | (68,035) | (18,469) | |||
Operating expenses: | |||||||
Research and development | 11,968 | 12,632 | 38,278 | 35,827 | |||
Sales, general and administrative | 29,143 | 18,493 | 74,414 | 64,554 | |||
Restructuring charges | 85 | 1,514 | 1,615 | 7,534 | |||
Total operating expenses | 41,196 | 32,639 | 114,307 | 107,915 | |||
Operating loss | (56,943) | (49,347) | (182,342) | (126,384) | |||
Other income (expense), net | |||||||
Interest expense, net | (8,035) | (6,671) | (18,505) | (21,337) | |||
Loss on extinguishment of debt | — | (5,075) | — | (5,075) | |||
Other, net | 26,481 | (5,663) | 24,352 | (23,119) | |||
Other income (expense), net | 18,446 | (17,409) | 5,847 | (49,531) | |||
Loss before income taxes and equity in losses | (38,497) | (66,756) | (176,495) | (175,915) | |||
Provision for income taxes | (2,399) | (174) | (4,161) | (1,219) | |||
Equity in (losses) income of unconsolidated | (3,582) | 917 | (10,784) | (5,018) | |||
Net loss | (44,478) | (66,013) | (191,440) | (182,152) | |||
Net (income) loss attributable to | (213) | 650 | (283) | 964 | |||
Net loss attributable to the stockholders | $ (44,691) | $ (65,363) | $ (191,723) | $ (181,188) | |||
Net loss per share attributable to stockholders: | |||||||
Basic | $ (1.09) | $ (1.62) | $ (4.70) | $ (4.97) | |||
Diluted | (1.09) | (1.62) | (4.70) | (4.97) | |||
Weighted average shares used to compute net | |||||||
Basic | 40,951 | 40,420 | 40,818 | 36,462 | |||
Diluted | 40,951 | 40,420 | 40,818 | 36,462 |
MAXEON SOLAR TECHNOLOGIES, LTD. | |||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY | |||||||||||||||
(unaudited) | |||||||||||||||
(In thousands) | |||||||||||||||
Shares | Amount | Additional | Accumulated | Accumulated | Equity | Noncontrolling Interests | Total Equity | ||||||||
Balance at January 2, 2022 | 44,247 | $ — | $ 624,261 | $ (262,961) | $ (11,844) | $ 349,456 | $ 5,419 | $ 354,875 | |||||||
Effect of adoption of ASU 2020-06 | — | — | (52,189) | 10,122 | — | (42,067) | — | (42,067) | |||||||
Net loss | — | — | — | (59,112) | — | (59,112) | (85) | (59,197) | |||||||
Issuance of common stock for stock-based | 354 | — | (2) | — | — | (2) | — | (2) | |||||||
Distribution to noncontrolling interest | — | — | — | — | — | — | (64) | (64) | |||||||
Recognition of stock-based compensation | — | — | 1,466 | — | — | 1,466 | — | 1,466 | |||||||
Other comprehensive income | — | — | — | — | (803) | (803) | — | (803) | |||||||
Balance at April 3, 2022 | 44,601 | $ — | $ 573,536 | $ (311,951) | $ (12,647) | $ 248,938 | $ 5,270 | $ 254,208 | |||||||
Net (loss) income | — | $ — | $ — | $ (87,920) | $ — | $ (87,920) | $ 155 | $ (87,765) | |||||||
Issuance of common stock for stock-based | 108 | — | (21) | — | — | (21) | — | (21) | |||||||
Recognition of stock-based compensation | — | — | 2,844 | — | — | 2,844 | — | 2,844 | |||||||
Other comprehensive income | — | — | — | — | (755) | (755) | — | (755) | |||||||
Balance at July 3, 2022 | 44,709 | — | 576,359 | (399,871) | (13,402) | 163,086 | 5,425 | 168,511 | |||||||
Net (loss) income | — | — | — | (44,691) | — | (44,691) | 213 | (44,478) | |||||||
Issuance of common stock for stock-based | 288 | (233) | — | — | (233) | — | (233) | ||||||||
Recognition of stock-based compensation | — | — | 5,272 | — | — | 5,272 | — | 5,272 | |||||||
Other comprehensive income | — | — | — | — | 1,406 | 1,406 | — | 1,406 | |||||||
Balance at October 2, 2022 | 44,997 | — | 581,398 | (444,562) | (11,996) | 124,840 | 5,638 | 130,478 | |||||||
Shares | Amount | Additional | Accumulated | Accumulated | Equity | Noncontrolling | Total Equity | ||||||||
Balance at January 3, 2021 | 33,995 | $ — | $ 451,474 | $ (8,441) | $ (10,391) | $ 432,642 | $ 6,645 | $ 439,287 | |||||||
Net loss | — | — | — | (38,814) | — | (38,814) | 98 | (38,716) | |||||||
Issuance of common stock for stock-based | 229 | — | (2,550) | — | — | (2,550) | — | (2,550) | |||||||
Recognition of stock-based compensation | — | — | 1,570 | — | — | 1,570 | — | 1,570 | |||||||
Other comprehensive income | — | — | — | — | (79) | (79) | — | (79) | |||||||
Balance at April 4, 2021 | 34,224 | $ — | $ 450,494 | $ (47,255) | $ (10,470) | $ 392,769 | $ 6,743 | $ 399,512 | |||||||
Net loss | — | — | — | (77,011) | — | (77,011) | (412) | (77,423) | |||||||
Issuance of common stock, net of issuance cost | 9,916 | — | 169,684 | — | — | 169,684 | — | 169,684 | |||||||
Issuance of common stock for stock-based | 57 | — | (1,262) | — | — | (1,262) | — | (1,262) | |||||||
Recognition of stock-based compensation | — | — | 2,097 | — | — | 2,097 | — | 2,097 | |||||||
Other comprehensive income | — | — | — | — | (473) | (473) | — | (473) | |||||||
Balance at July 4, 2021 | 44,197 | — | 621,013 | (124,266) | (10,943) | 485,804 | 6,331 | 492,135 | |||||||
Net loss | — | — | — | (65,363) | — | (65,363) | (650) | (66,013) | |||||||
Issuance of common stock for stock-based | 35 | — | (263) | — | — | (263) | — | (263) | |||||||
Recognition of stock-based compensation | — | — | 1,819 | — | — | 1,819 | — | 1,819 | |||||||
Other comprehensive income | — | — | — | — | 185 | 185 | — | 185 | |||||||
Balance at October 3, 2021 | 44,232 | — | 622,569 | (189,629) | (10,758) | 422,182 | 5,681 | 427,863 | |||||||
MAXEON SOLAR TECHNOLOGIES, LTD. | |||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
(unaudited) | |||
(In thousands) | |||
Nine Months Ended | |||
October 2, 2022 | October 3, 2021 | ||
Cash flows from operating activities | |||
Net loss | $ (191,440) | $ (182,152) | |
Adjustments to reconcile net loss to operating cash flows | |||
Depreciation and amortization | 42,263 | 30,095 | |
Stock-based compensation | 11,015 | 5,197 | |
Non-cash interest expense | 4,735 | 10,518 | |
Equity in losses of unconsolidated investees | 10,784 | 5,018 | |
Gain from dilution of interest in joint venture | — | (2,975) | |
Deferred income taxes | 2,540 | 1,926 | |
Loss on disposal of property, plant and equipment | 260 | 2,216 | |
Loss on debt extinguishment | — | 5,075 | |
Remeasurement (gain) loss on prepaid forward | (20,137) | 24,641 | |
Gain on liquidation of subsidiaries | (235) | — | |
Other, net | 886 | (1,728) | |
Changes in operating assets and liabilities | |||
Accounts receivable | (20,150) | 18,378 | |
Contract assets | 1,016 | 172 | |
Inventories | (87,984) | (50,884) | |
Prepaid expenses and other assets | (23,923) | (13,748) | |
Operating lease right-of-use assets | 2,104 | 1,812 | |
Advances to suppliers | 37,892 | 31,304 | |
Accounts payable and other accrued liabilities | 68,609 | 52,922 | |
Contract liabilities | 127,814 | 35,914 | |
Operating lease liabilities | (2,341) | (2,175) | |
Net cash used in operating activities | (36,292) | (28,474) | |
Cash flows from investing activities | |||
Purchases of property, plant and equipment | (56,023) | (116,801) | |
Purchases of intangible assets | (41) | — | |
Purchase of short-term securities | (76,000) | — | |
Proceeds from disposal of short-term investments | — | 1,318 | |
Proceeds from (cash paid for) disposal of property, plant and | 33 | (283) | |
Net cash used in investing activities | (132,031) | (115,766) | |
Cash flows from financing activities | |||
Proceeds from debt | 196,388 | 130,265 | |
Repayment of debt | (171,141) | (157,812) | |
Repayment of finance lease obligations | (433) | (535) | |
Payment for tax withholding obligations for issuance of common | (257) | (4,075) | |
Net proceeds from issuance of convertible debt | 188,812 | — | |
Net proceeds from issuance of common stock | — | 169,684 | |
Distribution to noncontrolling interest | (64) | — | |
Net cash provided by financing activities | 213,305 | 137,527 | |
Effect of exchange rate changes on cash, cash equivalents and | 348 | 67 | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 45,330 | (6,646) | |
Cash, cash equivalents and restricted cash, beginning of period | 192,232 | 209,572 | |
Cash, cash equivalents and restricted cash, end of period | $ 237,562 | $ 202,926 | |
Non-cash transactions | |||
Property, plant and equipment purchases funded by liabilities | $ 40,154 | $ 36,724 | |
Cost from issuance of common stock paid in shares | — | 1,078 | |
Property, plant and equipment obtained through capital lease | 2,127 | — | |
Right-of-use assets obtained in exchange for lease obligations | 4,778 | 5,020 | |
The following table reconciles our cash and cash equivalents and restricted cash reported on our Condensed Consolidated Balance Sheets and the cash, cash equivalents and restricted cash reported on our Condensed Consolidated Statements of Cash Flows as of October 2, 2022 and October 3, 2021:
(In thousands) | October 2, 2022 | October 3, 2021 | |
Cash and cash equivalents | $ 199,085 | $ 174,940 | |
Restricted cash, current portion, included in Prepaid expenses and | 35,968 | 3,962 | |
Restricted cash, net of current portion, included in Other long-term | 2,509 | 24,024 | |
Total cash, cash equivalents and restricted cash shown in Condensed | $ 237,562 | $ 202,926 |
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SOURCE Maxeon Solar Technologies, Ltd.