0001282631
false
NETLIST INC
0001282631
2021-11-02
2021-11-02
iso4217:USD
xbrli:shares
iso4217:USD
xbrli:shares
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934
November 2, 2021
Date of Report (Date of earliest event
reported):
NETLIST, INC.
(Exact name of registrant as specified in its charter)
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Delaware
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001-33170
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95-4812784
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(State or other jurisdiction of
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(Commission
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(IRS Employer
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incorporation)
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File Number)
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Identification Number)
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175 Technology Drive, Suite 150
Irvine, California 92618
(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:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common stock, par value $0.001 per share
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NLST
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None
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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 November 2, 2021, Netlist, Inc. (the “Company”)
issued a press release announcing the Company’s financial results for the third quarter ended October 2, 2021. 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.
SIGNATURE
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.
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NETLIST, INC.
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Date: November 2, 2021
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By:
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/s/ Gail M. Sasaki
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Gail M. Sasaki
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Vice President and Chief Financial Officer
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Exhibit 99.1
Netlist Reports Third Quarter 2021 Results
IRVINE, CALIFORNIA, November 2, 2021 - Netlist,
Inc. (OTCQB: NLST) today reported financial results for the third quarter ended October 2, 2021.
Revenue for the third quarter ended October 2, 2021 was $26.7 million
which was up 162% year over year. Net loss for the third quarter ended October 2, 2021 was ($10.7) million, or loss per share of ($0.05),
compared to a net loss in the prior year’s period of ($2.1) million, or a loss per share of ($0.01). These results include stock-based
compensation expense of $0.4 million for the quarter ended October 2, 2021 and $0.2 million for the quarter ended September 26, 2020.
As of October 2, 2021, cash, cash equivalents and restricted cash was
$73.2 million, total assets were $98.9 million, working capital was $47.2 million, total debt and accrued interest, net of debt discount,
was $21.2 million, and stockholders’ equity was $47.9 million.
“Third quarter revenue more than doubled compared to the
prior year period, while investments in sales, research and development, and legal activities tempered bottom line results. The
recent summary judgement in the case against Samsung was a major victory for Netlist. We look forward to the hearing on November
10th in the case against Google which will address the question of intervening rights,” said Netlist’s Chief
Executive Officer, C.K. Hong.
Conference Call Information
C.K. Hong, Chief Executive Officer, and Gail Sasaki, Chief Financial
Officer, will host an investor conference call today, November 2, 2021 at 12:00 p.m. Eastern Time to review Netlist’s results for
the third quarter 2021. 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 SSDs and modular memory subsystems
to enterprise customers in diverse industries. The Company's NVMe™ SSD portfolio provides industry-leading performance offered
in multiple capacities and form factors. Netlist also manufactures a line of specialty and legacy memory products to storage customers,
appliance customers, system builders and cloud and datacenter customers. Netlist holds a portfolio of patents in the areas of server
memory, hybrid memory, storage class memory, rank multiplication and load reduction. 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. 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 26, 2021, 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:
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The Plunkett Group
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Netlist, Inc.
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Mike Smargiassi
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Gail M. Sasaki
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NLST@theplunkettgroup.com
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Chief Financial Officer
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(212) 739-6729
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(949) 435-0025
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Netlist, Inc. and Subsidiaries
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Condensed Consolidated Balance Sheets
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(in thousands)
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(unaudited)
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October 2,
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January 2,
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2021
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2021
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ASSETS
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Current assets:
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|
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Cash and cash equivalents
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$
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62,282
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$
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13,326
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Restricted cash
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10,900
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3,200
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Accounts receivable, net
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4,758
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4,680
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Inventories
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19,387
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3,198
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Prepaid expenses and other current assets
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729
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514
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Total current assets
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98,056
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24,918
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Property and equipment, net
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425
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182
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Operating lease right-of-use assets
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165
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114
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Other assets
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282
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58
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Total assets
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$
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98,928
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$
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25,272
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
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Current liabilities:
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|
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Accounts payable
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$
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28,164
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$
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5,327
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Revolving line of credit
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4,487
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3,678
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Accrued payroll and related liabilities
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|
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1,116
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|
|
|
806
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Accrued expenses and other current liabilities
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|
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424
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|
|
|
777
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Long-term debt due within one year
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16,692
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17,056
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Total current liabilities
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50,883
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27,644
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Long-term debt
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—
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146
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Other liabilities
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131
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|
102
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Total liabilities
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51,014
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27,892
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Commitments and contingencies
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Stockholders' equity (deficit):
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|
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Preferred stock
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|
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—
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—
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Common stock
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226
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|
|
195
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Additional paid-in capital
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229,523
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192,071
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Accumulated deficit
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(181,835
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)
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(194,886
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)
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Total stockholders' equity (deficit)
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47,914
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(2,620
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)
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Total liabilities and stockholders' equity (deficit)
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$
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98,928
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$
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25,272
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Netlist, Inc. and Subsidiaries
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Condensed Consolidated Statements of Operations (Unaudited)
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(in thousands, except per share amounts)
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Three Months Ended
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Nine Months Ended
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October 2,
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September 26,
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October 2,
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September 26,
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2021
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2020
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2021
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2020
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Net product sales
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$
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26,749
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$
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10,212
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$
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66,009
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$
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35,749
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License fee
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|
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—
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|
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—
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40,000
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—
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Net sales
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26,749
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10,212
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106,009
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35,749
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Cost of sales(1)
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24,241
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8,875
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59,135
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30,477
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Gross profit
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2,508
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|
|
1,337
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46,874
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5,272
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Operating expenses:
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|
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|
|
|
|
|
|
|
|
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Research and development(1)
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2,038
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731
|
|
|
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5,222
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|
|
|
2,083
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Intellectual property legal fees
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8,461
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|
|
|
784
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|
|
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14,585
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|
|
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2,257
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Selling, general and administrative(1)
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|
|
2,590
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|
|
|
1,816
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|
|
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7,639
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|
|
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5,994
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Total operating expenses
|
|
|
13,089
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|
|
|
3,331
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|
|
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27,446
|
|
|
|
10,334
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|
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Operating (loss) income
|
|
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(10,581
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)
|
|
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(1,994
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)
|
|
|
19,428
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|
|
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(5,062
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)
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Other (expense) income, net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Interest expense, net
|
|
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(125
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)
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|
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(139
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)
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|
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(417
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)
|
|
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(437
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)
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Other (expense) income, net
|
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(2
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)
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|
3
|
|
|
|
641
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(2
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)
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Total other (expense) income, net
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|
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(127
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)
|
|
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(136
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)
|
|
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224
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|
|
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(439
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)
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(Loss) income before provision for income taxes
|
|
|
(10,708
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)
|
|
|
(2,130
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)
|
|
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19,652
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|
|
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(5,501
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)
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Provision for income taxes
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|
|
—
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|
|
|
—
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6,601
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|
|
|
1
|
|
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Net (loss) income
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|
$
|
(10,708
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)
|
|
$
|
(2,130
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)
|
|
$
|
13,051
|
|
|
$
|
(5,502
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)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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(Loss) earnings per share:
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|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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Basic
|
|
$
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(0.05
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.03
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)
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|
Diluted
|
|
$
|
(0.05
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.03
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)
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Basic
|
|
|
224,020
|
|
|
|
192,257
|
|
|
|
215,135
|
|
|
|
179,154
|
|
|
Diluted
|
|
|
224,020
|
|
|
|
192,257
|
|
|
|
235,862
|
|
|
|
179,154
|
|
|
|
|
|
|
|
|
|
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|
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|
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(1) Amounts include stock-based compensation expense as follows:
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
9
|
|
|
$
|
8
|
|
|
Research and development
|
|
|
160
|
|
|
|
63
|
|
|
|
438
|
|
|
|
154
|
|
|
Selling, general and administrative
|
|
|
283
|
|
|
|
148
|
|
|
|
715
|
|
|
|
420
|
|
|
Total stock-based compensation
|
|
$
|
445
|
|
|
$
|
212
|
|
|
$
|
1,162
|
|
|
$
|
582
|
|