GCT Semiconductor Holding, Inc. Reports First Quarter 2024 Financial Results
First Quarter 2024 Financial Summary and Recent Operational Highlights
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Revenues up by 7% as compared to the same quarter in 2023, to
$3.3 million . -
Income from operations of
$7.2 million due to an operating gain of$14.6 million on extinguishment of liability attributable to a termination under the Company’s development agreement with Samsung. This resulted in greater efficiency and cost savings, as GCT has partnered withAlpha Holdings Co., LTD (“Alpha Holdings”) to further progress the Company’s 5G chipset on Samsung’s Foundry. GCT’s products and product features have not changed as a result of these contract changes and the 5G products will still be manufactured at Samsung’s 8nm wafer line. -
Announced a MOU with
Aramco to accelerate the development of the 4G and 5G ecosystem inSaudi Arabia . Next steps for GCT include formalizing GCT’s role for defining and developing the 5G chipsets and related reference platforms that would best meet Aramco’s market needs. -
GCT common stock commenced trading on the NYSE on
March 27, 2024 , following its business combination withConcord Acquisition Corp III (the “Business Combination”). -
On
April 23, 2024 , the Company entered into an equity line of credit agreement (“ELOC”) with an affiliate ofB. Riley Securities, Inc. , pursuant to which the Company may sell shares of common stock, from time to time, up to$50 million , and the ELOC is expected to provide us with additional cash flow to fund our operations.
“We are excited about our operational progress during the first quarter of 2024. While we are still in a transition period from 4G toward 5G sales, our revenues for the quarter nevertheless increased slightly year over year, with our gross margin up as a result of high margin platform sales becoming a large portion of overall revenue,” said
“In Q1 2024, we’ve entered into a 5G development agreement with Alpha Holdings as well as with several IP vendors. Work under and related to these agreements will complete and or replace the work originally begun under the Samsung 5G development agreement. This change will allow us to achieve materially identical results, but with significant cost savings to GCT, and it is driven and supported by a change in Samsung business model, whereby GCT interacts directly with Samsung’s qualified design house and related IP vendors.”
“As previously announced, we have signed a MOU with
First Quarter 2024 Financial Results
Net revenues increased by
Cost of net revenues decreased by
Gross margin improved to 60% for the three months ended
Research and development expenses increased by
Sales and marketing expenses increased by
General and administrative expenses increased by
Liquidity
The Company’s existing sources of liquidity as of
The Company received
5G Outlook
The Company is confident with the progress of the 5G chipset development and expects to have its 5G chipsets available for broad sampling to customers during the fourth quarter of 2024, with volume shipments commencing in the first half of 2025.
Conference Call
Given the recent close of the business combination and public listing of GCT, the Company anticipates hosting its inaugural earnings conference call for the second quarter ending
Additionally, GCT’s management will be presenting and holding one-on-one meetings at the 24th Annual
About
GCT is a leading fabless designer and supplier of advanced 5G and 4G LTE semiconductor solutions. GCT’s market-proven solutions have enabled fast and reliable 4G LTE connectivity to numerous commercial devices such as CPEs, mobile hotspots, routers, M2M applications and smartphones, etc., for the world’s top wireless carriers. GCT’s system-on-chip solutions integrate radio frequency, baseband modem and digital signal processing functions, therefore offering complete 4G and 5G platform solutions with small form factors, low power consumption, high performance, high reliability, and cost-effectiveness. For more information, visit www.gctsemi.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1955. These forward-looking statements include, without limitation, statements about the anticipated benefits of the business combination with
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Condensed Consolidated Balance Sheets |
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(in thousands, except per share data) |
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(unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
16,122 |
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$ |
258 |
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Accounts receivable, net |
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5,103 |
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4,920 |
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Inventory |
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1,784 |
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1,486 |
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Contract assets |
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4,313 |
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3,439 |
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Prepaid expenses and other current assets |
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5,466 |
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2,906 |
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Total current assets |
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32,788 |
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13,009 |
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Property and equipment, net |
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644 |
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772 |
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Operating lease right-of-use assets |
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1,343 |
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1,521 |
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Intangibles, net |
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187 |
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245 |
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Other assets |
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857 |
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881 |
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Total assets |
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$ |
35,819 |
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$ |
16,428 |
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Liabilities and Stockholders’ Deficit |
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Current liabilities: |
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Accounts payable |
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$ |
1,242 |
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$ |
17,814 |
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Contract liabilities |
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35 |
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48 |
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Accrued and other current liabilities |
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25,152 |
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23,956 |
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Borrowings |
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39,840 |
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44,509 |
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Convertible promissory notes, current |
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5,645 |
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27,794 |
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Operating lease liabilities, current |
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679 |
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680 |
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Total current liabilities |
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72,593 |
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114,801 |
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Convertible promissory notes, net of current |
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4,672 |
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6,239 |
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Net defined benefit liabilities |
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7,488 |
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7,689 |
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Long-term operating lease liabilities |
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674 |
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850 |
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Income taxes payable |
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2,096 |
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2,178 |
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Warrant liabilities |
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10,584 |
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— |
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Other liabilities |
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72 |
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108 |
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Total liabilities |
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98,179 |
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131,865 |
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Stockholders’ deficit: |
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Preferred stock, par value |
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— |
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— |
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Common stock, par value |
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5 |
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3 |
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Additional paid-in capital(1) |
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487,006 |
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435,752 |
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Accumulated other comprehensive loss |
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(474 |
) |
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(1,538 |
) |
Accumulated deficit |
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(548,897 |
) |
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(549,654 |
) |
Total stockholders’ deficit |
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(62,360 |
) |
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(115,437 |
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Total liabilities and stockholders’ deficit |
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$ |
35,819 |
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$ |
16,428 |
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(1) |
Amounts as of |
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Condensed Consolidated Statements of Operations |
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(unaudited, in thousands, except per share amounts) |
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Three Months Ended |
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2024 |
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2023 |
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Net revenues: |
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Product |
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$ |
2,378 |
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$ |
599 |
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Service |
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887 |
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2,463 |
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Total net revenues |
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3,265 |
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3,062 |
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Cost of net revenues: |
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Product |
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654 |
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978 |
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Service |
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658 |
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563 |
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Total cost of net revenues |
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1,312 |
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1,541 |
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Gross profit |
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1,953 |
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1,521 |
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Operating expenses: |
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Research and development |
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5,521 |
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902 |
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Sales and marketing |
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996 |
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836 |
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General and administrative |
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2,836 |
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1,477 |
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Gain on extinguishment of liability |
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(14,636 |
) |
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— |
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Total operating (income) expenses |
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(5,283 |
) |
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3,215 |
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Income (loss) from operations |
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7,236 |
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(1,694 |
) |
Interest expense |
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(2,082 |
) |
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(935 |
) |
Other (expenses) income, net |
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(4,338 |
) |
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1,286 |
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Income (loss) before provision for income taxes |
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816 |
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(1,343 |
) |
Provision for income taxes |
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59 |
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50 |
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Net income (loss) |
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757 |
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(1,393 |
) |
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Net income (loss) per common share(1): |
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Basic |
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$ |
0.03 |
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$ |
(0.06 |
) |
Diluted |
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$ |
0.03 |
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$ |
(0.06 |
) |
Weighted-average shares used in computing net income (loss) per common shares(1): |
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Basic |
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25,468 |
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23,862 |
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Diluted |
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26,257 |
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23,862 |
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(1) |
Amounts as of |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240514638892/en/
- Investor relations website: investors.gctsemi.com
-
Investor relations contact:
Gateway Group ,Matt Glover &Ralf Esper , GCT@gateway-grp.com -
Media contact:
Sophie Heerinckx , sheerinckx@gctsemi.com
Source: