0001282631 false NETLIST INC 0001282631 2022-08-02 2022-08-02 iso4217:USD xbrli:shares iso4217:USD xbrli:shares





Washington, D.C. 20549







Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


August 2, 2022

Date of Report (Date of earliest event reported):







(Exact name of registrant as specified in its charter)


Delaware   001-33170   95-4812784
(State or other jurisdiction of   (Commission   (IRS Employer
incorporation)   File Number)   Identification Number)


111 Academy, Suite 100

Irvine, California 92617

(Address of principal executive offices)


(949) 435-0025

(Registrant’s telephone number, including area code)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


¨    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)


¨    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


¨    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


¨    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Securities registered pursuant to Section 12(b) of the Act:


Title of each class  

Trading Symbol(s)

  Name of each exchange on which registered
Common stock, par value $0.001 per share   NLST   None


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).


Emerging growth company ¨


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨







Item 2.02. Results of Operations and Financial Condition.


On August 2, 2022, Netlist, Inc. (the “Company”) issued a press release announcing the Company’s financial results for the second quarter ended July 2, 2022. A copy of the press release is attached hereto as Exhibit 99.1.


The information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.


Item 9.01. Financial Statements and Exhibits.


(d)       Exhibits.


Number   Description
99.1   Press Release of Netlist, Inc., dated August 2, 2022.
104   Cover Page Interactive Data File (embedded within the inline XBRL document)







Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


Date:  August 2, 2022 By: /s/ Gail M. Sasaki
    Gail M. Sasaki
    Executive Vice President and Chief Financial Officer



Exhibit 99.1


Netlist Reports Second Quarter 2022 Results


IRVINE, CALIFORNIA, August 2, 2022 - Netlist, Inc. (OTCQB: NLST) today reported financial results for the second quarter ended July 2, 2022.


Second Quarter 2022 Highlights:


Net product sales more than doubled to $55.4 million compared to $24.4 million for last year’s quarter.

Product gross profit dollars increased by 66%. Product gross profit was $4.7 million compared to $2.9 million for last year’s quarter.


“Netlist delivered another quarter of strong product revenue and gross profit growth,” said Chief Executive Officer, C.K. Hong. “We continue to benefit from strategic supply relationships and an expanding customer base. Intellectual property enforcement actions are making steady progress, and we remain committed to the fair licensing of our unique technologies.”


Net product sales for the second quarter ended July 2, 2022 were $55.4 million, compared to net product sales of $24.4 million for the second quarter ended July 3, 2021 and $50.2 million in the most recent quarter. Product gross profit for the second quarter ended July 2, 2022 was $4.7 million, compared to a product gross profit of $2.9 million for the second quarter ended July 3, 2021 and $3.4 million for the most recent quarter.


Total net sales for the second quarter ended July 2, 2022 was $55.4 million, compared to total net sales of $64.4 million for the second quarter ended July 3, 2021. Net loss for the second quarter ended July 2, 2022 was ($5.0) million, or ($0.02) per share, compared to a net income in the prior year period of $27.8 million, or $0.12 per diluted share. These results include stock-based compensation expense of $0.8 million and $0.4 million for the quarters ended July 2, 2022 and July 3, 2021, respectively.


As of July 2, 2022, cash, cash equivalents and restricted cash was $60.6 million, total assets were $99.6 million, working capital was $46.3 million, total debt was $8.2 million, and stockholders’ equity was $47.9 million.


Conference Call Information


C.K. Hong, Chief Executive Officer, and Gail Sasaki, Chief Financial Officer, will host an investor conference call today, August 2, 2022 at 12:00 p.m. Eastern Time to review Netlist’s results for the second quarter ended July 2, 2022. The live webcast and archived replay of the call can be accessed for 90 days in the Investors section of Netlist’s website at www.netlist.com.





About Netlist


Netlist provides high-performance solid state drives and modular memory solutions to enterprise customers in diverse industries. The Company's NVMe™ SSDs in various capacities and form factors and the line of custom and specialty memory products bring industry-leading performance to server and storage appliance customers and cloud service providers. Netlist licenses its portfolio of intellectual property including patents, in server memory, hybrid memory and storage class memory, to companies that implement Netlist's technology. To learn more, visit www.netlist.com.


Safe Harbor Statement


This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical facts and often address future events or Netlist's future performance. Forward-looking statements contained in this news release include statements about Netlist's ability to execute on its strategic initiatives. All forward-looking statements reflect management's present expectations regarding future events and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed in or implied by any forward-looking statements. These risks, uncertainties and other factors include, among others: risks related to Netlist's plans for its intellectual property, including its strategies for monetizing, licensing, expanding, and defending its patent portfolio; risks associated with patent infringement litigation initiated by Netlist, or by others against Netlist, as well as the costs and unpredictability of any such litigation; risks associated with Netlist's product sales, including the market and demand for products sold by Netlist and its ability to successfully develop and launch new products that are attractive to the market; the success of product, joint development and licensing partnerships; the competitive landscape of Netlist's industry; and general economic, political and market conditions, including quarantines, factory slowdowns or shutdowns, and travel restrictions resulting from the COVID-19 pandemic. The military conflict between Russia and Ukraine may increase the likelihood of supply interruptions. All forward-looking statements reflect management's present assumptions, expectations and beliefs regarding future events and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed in or implied by any forward-looking statements. These and other risks and uncertainties are described in Netlist's annual report on Form 10-K for its most recently completed fiscal year filed on March 1, 2022, and the other filings it makes with the U.S. Securities and Exchange Commission from time to time, including any subsequently filed quarterly and current reports. In light of these risks, uncertainties and other factors, these forward-looking statements should not be relied on as predictions of future events. These forward-looking statements represent Netlist's assumptions, expectations and beliefs only as of the date they are made, and except as required by law, Netlist undertakes no obligation to revise or update any forward-looking statements for any reason.


(Tables Follow)


For more information, please contact:


The Plunkett Group Netlist, Inc.
Mike Smargiassi Gail M. Sasaki
NLST@theplunkettgroup.com Chief Financial Officer
(212) 739-6729 (949) 435-0025





Netlist, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands)


   July 2,   January 1, 
   2022   2022 
Current assets:          
Cash and cash equivalents  $40,465   $47,679 
Restricted cash   20,100    10,800 
Accounts receivable, net   12,328    12,727 
Inventories   21,857    15,670 
Prepaid expenses and other current assets   1,018    1,126 
Total current assets   95,768    88,002 
Property and equipment, net   1,180    989 
Operating lease right-of-use assets   2,369    1,891 
Other assets   319    294 
Total assets  $99,636   $91,176 
Current liabilities:          
Accounts payable  $38,309   $25,887 
Revolving line of credit   8,019    7,000 
Accrued payroll and related liabilities   1,430    1,308 
Accrued expenses and other current liabilities   1,485    632 
Long-term debt due within one year   189    562 
Total current liabilities   49,432    35,389 
Operating lease liabilities   1,932    1,593 
Other liabilities   356    152 
Total liabilities   51,720    37,134 
Commitments and contingencies          
Stockholders' equity:          
Preferred stock        
Common stock   232    231 
Additional paid-in capital   248,563    243,866 
Accumulated deficit   (200,879)   (190,055)
Total stockholders' equity   47,916    54,042 
Total liabilities and stockholders' equity  $99,636   $91,176 





Netlist, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations (Unaudited)

(in thousands, except per share amounts)


   Three Months Ended   Six Months Ended 
   July 2,   July 3,   July 2,   July 3, 
   2022   2021   2022   2021 
Net product sales  $55,358   $24,363   $105,558   $39,260 
License fee       40,000        40,000 
Net sales   55,358    64,363    105,558    79,260 
Cost of sales(1)   50,610    21,498    97,447    34,894 
Gross profit   4,748    42,865    8,111    44,366 
Operating expenses:                    
Research and development(1)   2,672    2,060    5,129    3,184 
Intellectual property legal fees   3,313    3,837    6,139    6,124 
Selling, general and administrative(1)   3,724    3,092    7,662    5,049 
Total operating expenses   9,709    8,989    18,930    14,357 
Operating (loss) income   (4,961)   33,876    (10,819)   30,009 
Other (expense) income, net:                    
Interest income (expense), net   15    (145)   4    (292)
Other (expense) income, net   (6)   645    (8)   643 
Total other (expense) income, net   9    500    (4)   351 
(Loss) income before provision for income taxes   (4,952)   34,376    (10,823)   30,360 
Provision for income taxes       6,600    1    6,601 
Net (loss) income  $(4,952)  $27,776   $(10,824)  $23,759 
Earninngs (loss) per common share:                    
Basic  $(0.02)  $0.13   $(0.05)  $0.11 
Diluted  $(0.02)  $0.12   $(0.05)  $0.10 
Weighted-average common shares outstanding:                    
Basic   231,298    215,706    230,922    210,693 
Diluted   231,298    235,176    230,922    229,305 
(1)  Amounts include stock-based compensation expense as follows:                    
Cost of sales  $16   $4   $19   $7 
Research and development   215    168    391    278 
Selling, general and administrative   559    207    1,062    432 
Total stock-based compensation  $790   $379   $1,472   $717