|
||
(State or other jurisdiction of
incorporation or organization)
|
||
|
|
|
(Commission File Number)
|
(I.R.S. Employer
Identification No.)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
|
|
|
Exhibit No.
|
Description
|
|
Press Release issued by the registrant on April 28, 2020, furnished herewith.
|
||
104
|
Cover Page Interactive Data File (embedded within the Inline XBRL document).
|
Date: April 28, 2020
|
iRobot Corporation
|
|
By: /s/ Glen D. Weinstein
|
||
Name: Glen D. Weinstein
|
||
Title: Chief Legal Officer and Secretary
|
Contacts:
|
||||
Andrew Kramer
|
Charlie Vaida
|
|||
Investor Relations
|
Media Relations
|
|||
iRobot Corp.
|
iRobot Corp.
|
|||
(781) 430-3003
|
(781) 430-3182
|
|||
akramer@irobot.com
|
cvaida@irobot.com
|
|||
•
|
Revenue for the first quarter of 2020 was $192.5 million, a decrease of 19% from $237.7 million in the first quarter of 2019.
|
•
|
The largest driver of the shortfall against the company’s February 2020 targets for first-quarter 2020 revenue was the inability to completely fulfill anticipated first-quarter demand for certain premium robots due to design-driven engineering and supply chain challenges that were unexpectedly complicated by the impact of COVID-19 on our organization, our contract manufacturers and some suppliers.
|
•
|
The first-quarter 2020 revenue performance reflected declines of 28% in the U.S., 14% in Japan and 11% in EMEA from the first quarter of 2019.
|
•
|
GAAP operating loss for the first quarter of 2020 was $20.2 million, compared with GAAP operating income of $22.3 million in the first quarter of 2019. First-quarter 2020 non-GAAP operating loss of $14.4 million decreased from non-GAAP operating income of $33.1 million in the same period one year ago.
|
•
|
GAAP net loss per share was $0.64 for the first quarter of 2020, compared with net income per share of $0.78 in the first quarter of 2019. Non-GAAP net loss per share was $0.32 for the first quarter of 2020 versus non-GAAP first-quarter 2019 earnings per share of $0.96.
|
•
|
Following authorization by iRobot’s Board of Directors for a $200 million stock repurchase program, the company repurchased 663,602 shares of its common stock at an average price of $37.65 per share during the first quarter of 2020 for a total of $25.0 million.
|
•
|
As of March 28, 2020, the company’s cash, cash equivalents and short-term investments were $263.5 million, compared with $256.4 million at the end of 2019 and $200.5 million as of March 30, 2019. The company, which has no debt, also has access to an unsecured revolving line of credit of $150 million, with an additional $75 million accordion feature.
|
•
|
iRobot recently initiated a series of cost-reduction actions, which are expected to drive approximately $30 million in net savings during 2020. In addition, these actions support the company’s plans to accelerate certain strategic initiatives and further shift R&D engineering talent from hardware to software.
|
•
|
More specifically, the company has eliminated approximately 70 positions, primarily within its research and development organization. The headcount reduction represents approximately 5% of its workforce as of March 28, 2020. In addition, iRobot furloughed 14 sales and marketing professionals involved in supporting the company’s European in-store retail activities and reduced the scope of its 2020 hiring plans.
|
•
|
Other cost-reduction actions include realigning working media with near-term revenue, reducing short-term incentive compensation and adjusting travel costs.
|
•
|
In conjunction with the workforce reduction, the company has suspended the go-to-market plans for its Terra robot lawnmower. This decision primarily reflects the likelihood of significant delays to the company’s 2020 commercial plans for Terra caused by COVID-19 combined with the overall intensity of planned technology investment over the coming quarters.
|
•
|
iRobot expects to record a restructuring charge of approximately $2 million in the second quarter primarily for severance costs associated with the workforce reduction.
|
•
|
On April 24, 2020, iRobot’s request for an exclusion for its Roomba® robot vacuums from Section 301 tariffs was granted by the United States Trade Representative. This exclusion is effective until August 7, 2020, and allows iRobot to seek a refund of Section 301 tariffs paid since September 2018.
|
•
|
In addition to naming
Julie Zeiler
, currently VP of Finance, to succeed Alison Dean as EVP and CFO effective May 4, iRobot also appointed
current Vice President and General Manager, EMEA, JJ Blanc as Chief Commercial Officer and Charlie Kirol as Chief Supply Chain Officer
.
|
•
|
The company successfully introduced the
Roomba® s9
vacuum in
Japan
and
China
.
|
•
|
Continued progress in expanding the company’s community of engaged users who have opted-in to its digital communications to over 5.1 million, up 18% since the end of 2019 and 170% from the same period one year ago.
|
•
|
In early April, iRobot consolidated all of its education products and services under
iRobot Education
, providing access to educational robots, online resources and programming to inspire the next generation of roboticists, programmers, engineers and scientists.
|
•
|
Continued recognition of iRobot as an innovator by
NPD
and
Fast Company
, while the s9’s exceptional performance and extensive functionality received awards and rave reviews from
Good Housekeeping
,
CES
,
RealHomes.com
and
iF International Forum Design
.
|
•
|
Active involvement in several COVID-19 relief initiatives, such as donating thousands of masks from its manufacturing facilities to healthcare workers, participating in a project to repurpose Roomba filters for use in personal protective equipment, supporting a third-party organization to retrofit Roomba in Italian hospitals with a tripod and phone to connect patients with their families and releasing numerous free online and offline learning materials for both teachers and students.
|
Date:
|
Wednesday, April 29
|
Time:
|
8:30 a.m. ET
|
Call-In Number:
|
213-358-0894
|
Conference ID:
|
4191017
|
iRobot Corporation
|
|||||||
Consolidated Statements of Operations
|
|||||||
(in thousands, except per share amounts)
|
|||||||
(unaudited)
|
|||||||
For the three months ended
|
|||||||
March 28, 2020
|
March 30, 2019
|
||||||
Revenue
|
$
|
192,535
|
|
$
|
237,661
|
|
|
Cost of revenue:
|
|||||||
Cost of product revenue
|
114,295
|
|
115,038
|
|
|||
Amortization of acquired intangible assets
|
285
|
|
3,077
|
|
|||
Total cost of revenue
|
114,580
|
|
118,115
|
|
|||
Gross profit
|
77,955
|
|
119,546
|
|
|||
Operating expenses:
|
|||||||
Research and development
|
36,759
|
|
35,269
|
|
|||
Selling and marketing
|
36,594
|
|
38,836
|
|
|||
General and administrative
|
24,573
|
|
22,907
|
|
|||
Amortization of acquired intangible assets
|
254
|
|
271
|
|
|||
Total operating expenses
|
98,180
|
|
97,283
|
|
|||
Operating (loss) income
|
(20,225
|
)
|
22,263
|
|
|||
Other (expense) income, net
|
(19
|
)
|
1,280
|
|
|||
(Loss) income before income taxes
|
(20,244
|
)
|
23,543
|
|
|||
Income tax (benefit) expense
|
(2,109
|
)
|
1,023
|
|
|||
Net (loss) income
|
$
|
(18,135
|
)
|
$
|
22,520
|
|
|
Net (loss) income per share:
|
|||||||
Basic
|
$
|
(0.64
|
)
|
$
|
0.81
|
|
|
Diluted
|
$
|
(0.64
|
)
|
$
|
0.78
|
|
|
Number of shares used in per share calculations:
|
|||||||
Basic
|
28,297
|
|
27,863
|
|
|||
Diluted
|
28,297
|
|
28,763
|
|
|||
Stock-based compensation included in above figures:
|
|||||||
Cost of revenue
|
$
|
527
|
|
$
|
378
|
|
|
Research and development
|
2,478
|
|
2,379
|
|
|||
Selling and marketing
|
766
|
|
802
|
|
|||
General and administrative
|
1,420
|
|
3,305
|
|
|||
Total
|
$
|
5,191
|
|
$
|
6,864
|
|
|
iRobot Corporation
|
|||||||
Condensed Consolidated Balance Sheets
|
|||||||
(unaudited, in thousands)
|
|||||||
March 28, 2020
|
December 28, 2019
|
||||||
Assets
|
|||||||
Cash and cash equivalents
|
$
|
248,768
|
|
$
|
239,392
|
|
|
Short term investments
|
14,759
|
|
17,032
|
|
|||
Accounts receivable, net
|
37,013
|
|
146,161
|
|
|||
Inventory
|
147,249
|
|
157,347
|
|
|||
Other current assets
|
41,743
|
|
34,285
|
|
|||
Total current assets
|
489,532
|
|
594,217
|
|
|||
Property and equipment, net
|
79,530
|
|
75,988
|
|
|||
Operating lease right-of-use assets
|
45,958
|
|
47,478
|
|
|||
Deferred tax assets
|
41,071
|
|
41,791
|
|
|||
Goodwill
|
118,377
|
|
118,732
|
|
|||
Intangible assets, net
|
11,787
|
|
12,352
|
|
|||
Other assets
|
33,778
|
|
30,195
|
|
|||
Total assets
|
$
|
820,033
|
|
$
|
920,753
|
|
|
Liabilities and stockholders' equity
|
|||||||
Accounts payable
|
$
|
77,217
|
|
$
|
116,185
|
|
|
Accrued expenses
|
55,801
|
|
81,768
|
|
|||
Deferred revenue and customer advances
|
5,320
|
|
4,549
|
|
|||
Total current liabilities
|
138,338
|
|
202,502
|
|
|||
Operating lease liabilities
|
53,044
|
|
54,928
|
|
|||
Deferred tax liabilities
|
1,054
|
|
912
|
|
|||
Other long-term liabilities
|
11,058
|
|
10,342
|
|
|||
Total long-term liabilities
|
65,156
|
|
66,182
|
|
|||
Total liabilities
|
203,494
|
|
268,684
|
|
|||
Stockholders' equity
|
616,539
|
|
652,069
|
|
|||
Total liabilities and stockholders' equity
|
$
|
820,033
|
|
$
|
920,753
|
|
|
iRobot Corporation
|
|||||||
Consolidated Statements of Cash Flows
|
|||||||
(unaudited, in thousands)
|
|||||||
For the three months ended
|
|||||||
March 28, 2020
|
March 30, 2019
|
||||||
Cash flows from operating activities:
|
|||||||
Net (loss) income
|
$
|
(18,135
|
)
|
$
|
22,520
|
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|||||||
Depreciation and amortization
|
7,459
|
|
8,724
|
|
|||
Stock-based compensation
|
5,191
|
|
6,864
|
|
|||
Deferred income taxes, net
|
(528
|
)
|
1,739
|
|
|||
Other
|
1,531
|
|
1,542
|
|
|||
Changes in operating assets and liabilities — (use) source
|
|||||||
Accounts receivable
|
108,825
|
|
106,561
|
|
|||
Inventory
|
9,848
|
|
(16,863
|
)
|
|||
Other current assets
|
(5,612
|
)
|
(2,913
|
)
|
|||
Accounts payable
|
(41,440
|
)
|
(52,744
|
)
|
|||
Accrued expenses and other liabilities
|
(26,405
|
)
|
(22,727
|
)
|
|||
Net cash provided by operating activities
|
40,734
|
|
52,703
|
|
|||
Cash flows from investing activities:
|
|||||||
Additions of property and equipment
|
(7,310
|
)
|
(6,004
|
)
|
|||
Change in other assets
|
(1,560
|
)
|
(1,977
|
)
|
|||
Sales and maturities of investments
|
3,500
|
|
2,380
|
|
|||
Net cash used in investing activities
|
(5,370
|
)
|
(5,601
|
)
|
|||
Cash flows from financing activities:
|
|||||||
Proceeds from employee stock plans
|
934
|
|
2,563
|
|
|||
Income tax withholding payment associated with restricted stock vesting
|
(1,816
|
)
|
(7,212
|
)
|
|||
Stock repurchases
|
(25,000
|
)
|
—
|
|
|||
Net cash used in financing activities
|
(25,882
|
)
|
(4,649
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(106
|
)
|
268
|
|
|||
Net increase in cash and cash equivalents
|
9,376
|
|
42,721
|
|
|||
Cash and cash equivalents, at beginning of period
|
239,392
|
|
130,373
|
|
|||
Cash and cash equivalents, at end of period
|
$
|
248,768
|
|
$
|
173,094
|
|
|
iRobot Corporation
|
|||||||
Supplemental Information
|
|||||||
(unaudited)
|
|||||||
For the three months ended
|
|||||||
March 28, 2020
|
March 30, 2019
|
||||||
Revenue by Geography: *
|
|||||||
Domestic
|
$
|
81,967
|
|
$
|
114,065
|
|
|
International
|
110,568
|
|
123,596
|
|
|||
Total
|
$
|
192,535
|
|
$
|
237,661
|
|
|
Units Shipped *
|
|||||||
Vacuum
|
625
|
|
764
|
|
|||
Mopping
|
96
|
|
112
|
|
|||
Total
|
721
|
|
876
|
|
|||
Revenue by Product Category **
|
|||||||
Vacuum***
|
$
|
170
|
|
$
|
221
|
|
|
Mopping***
|
23
|
|
17
|
|
|||
$
|
193
|
|
$
|
238
|
|
||
Average gross selling prices for robot units
|
$
|
315
|
|
$
|
321
|
|
|
Section 301 tariff costs *
|
$
|
6,609
|
|
$
|
3,518
|
|
|
Section 301 tariff impact on gross and operating margin
|
(3.4
|
)%
|
(1.5
|
)%
|
|||
Headcount
|
1,147
|
|
1,072
|
|
|||
* in thousands
|
|||||||
** in millions
|
|||||||
*** includes accessory revenue
|
iRobot Corporation
|
|||||||
Supplemental Reconciliation of GAAP Actuals to Non-GAAP Actuals
|
|||||||
(in thousands, except per share amounts)
|
|||||||
(unaudited)
|
|||||||
For the three months ended
|
|||||||
March 28, 2020
|
March 30, 2019
|
||||||
GAAP Revenue
|
$
|
192,535
|
|
$
|
237,661
|
|
|
GAAP Gross Profit
|
$
|
77,955
|
|
$
|
119,546
|
|
|
Amortization of acquired intangible assets
|
285
|
|
3,077
|
|
|||
Stock-based compensation
|
527
|
|
378
|
|
|||
Non-GAAP Gross Profit
|
$
|
78,767
|
|
$
|
123,001
|
|
|
Non-GAAP Gross Profit Margin
|
40.9
|
%
|
51.8
|
%
|
|||
GAAP Operating Expenses
|
$
|
98,180
|
|
$
|
97,283
|
|
|
Amortization of acquired intangible assets
|
(254
|
)
|
(271
|
)
|
|||
Stock-based compensation
|
(4,664
|
)
|
(6,486
|
)
|
|||
Net merger, acquisition and divestiture (income) expense
|
500
|
|
(152
|
)
|
|||
IP litigation expense, net
|
(615
|
)
|
(469
|
)
|
|||
Non-GAAP Operating Expenses
|
$
|
93,147
|
|
$
|
89,905
|
|
|
Non-GAAP Operating Expenses as a % of Non-GAAP Revenue
|
48.4
|
%
|
37.8
|
%
|
|||
GAAP Operating (Loss) Income
|
$
|
(20,225
|
)
|
$
|
22,263
|
|
|
Amortization of acquired intangible assets
|
539
|
|
3,348
|
|
|||
Stock-based compensation
|
5,191
|
|
6,864
|
|
|||
Net merger, acquisition and divestiture (income) expense
|
(500
|
)
|
152
|
|
|||
IP litigation expense, net
|
615
|
|
469
|
|
|||
Non-GAAP Operating (Loss) Income
|
$
|
(14,380
|
)
|
$
|
33,096
|
|
|
Non-GAAP Operating Margin
|
(7.5
|
)%
|
13.9
|
%
|
|||
GAAP Income Tax (Benefit) Expense
|
$
|
(2,109
|
)
|
$
|
1,023
|
|
|
Tax effect of non-GAAP adjustments
|
(1,831
|
)
|
1,824
|
|
|||
Other tax adjustments
|
(1,384
|
)
|
4,067
|
|
|||
Non-GAAP Income Tax (Benefit) Expense
|
$
|
(5,324
|
)
|
$
|
6,914
|
|
|
GAAP Net (Loss) Income
|
$
|
(18,135
|
)
|
$
|
22,520
|
|
|
Amortization of acquired intangible assets
|
539
|
|
3,348
|
|
|||
Stock-based compensation
|
5,191
|
|
6,864
|
|
|||
Net merger, acquisition and divestiture (income) expense
|
(500
|
)
|
152
|
|
|||
IP litigation expense, net
|
615
|
|
469
|
|
|||
(Gain) loss on strategic investments
|
(87
|
)
|
57
|
|
|||
Income tax effect
|
3,215
|
|
(5,891
|
)
|
|||
Non-GAAP Net (Loss) Income
|
$
|
(9,162
|
)
|
$
|
27,519
|
|
|
iRobot Corporation
|
|||||||
Supplemental Reconciliation of GAAP Actuals to Non-GAAP Actuals continued
|
|||||||
(in thousands, except per share amounts)
|
|||||||
(unaudited)
|
|||||||
For the three months ended
|
|||||||
March 28, 2020
|
March 30, 2019
|
||||||
GAAP Net (Loss) Income Per Diluted Share
|
$
|
(0.64
|
)
|
$
|
0.78
|
|
|
Amortization of acquired intangible assets
|
0.02
|
|
0.12
|
|
|||
Stock-based compensation
|
0.19
|
|
0.24
|
|
|||
Net merger, acquisition and divestiture (income) expense
|
(0.02
|
)
|
—
|
|
|||
IP litigation expense, net
|
0.02
|
|
0.02
|
|
|||
(Gain) loss on strategic investments
|
—
|
|
—
|
|
|||
Income tax effect
|
0.11
|
|
(0.20
|
)
|
|||
Non-GAAP Net (Loss) Income Per Diluted Share
|
$
|
(0.32
|
)
|
$
|
0.96
|
|
|
Number of shares used in diluted per share calculation
|
28,297
|
|
28,763
|
|
|||
Section 301 Tariff Costs
|
|||||||
Section 301 tariff costs
|
$
|
6,609
|
|
$
|
3,518
|
|
|
Impact of Section 301 tariff costs to gross and operating margin (GAAP & non-GAAP)
|
(3.4
|
)%
|
(1.5
|
)%
|
|||
Impact of Section 301 tariff costs to net (loss) income per diluted share (GAAP & non-GAAP)
|
$
|
(0.23
|
)
|
$
|
(0.12
|
)
|
|
Supplemental Information
|
|||||||
Days sales outstanding
|
18
|
|
21
|
|
|||
Days in inventory
|
118
|
|
144
|
|
|||