Outperforms Guidance, Posts Record Revenue and EPS
REHOVOT, Israel, May 12, 2022 /PRNewswire/ -- Nova (Nasdaq: NVMI) today announced financial results for the first quarter ended March 31, 2022.
First Quarter 2022 Highlights:
- Record quarterly revenue of $134.0 million, exceeding the high end of a guidance of $132 million. Up 59% year over year
- Record GAAP net income of $34.2 million, or $1.07 per diluted share, exceeding the high end of a guidance of $0.96. Up 78% year over year on a per-share basis
- Record non-GAAP net income of $41.5 million, or $1.30 per diluted share, exceeding the high end of a guidance of $1.14. Up 86% year over year on a per-share basis
- Diversified geographic contributions led by China quarterly record revenue
- Strong customer mix driven by five major customers contributing over 10% each to products revenue, including the world leading IDM
GAAP Results ($K) | |||
Q1 2022 | Q4 2021 | Q1 2021 | |
Revenues | $133,957 | $121,521 | $84,133 |
Net Income | $34,162 | $22,226 | $17,616 |
Earnings per Diluted Share | $1.07 | $0.73 | $0.60 |
Non-GAAP Results ($K) | |||
Q1 2022 | Q4 2021 | Q1 2021 | |
Net Income | $ 41,487 | $32,752 | $20,485 |
Earnings per Diluted Share | $ 1.30 | $1.08 | $0.70 |
A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements included in this release. See also "Use of Non-GAAP Adjusted Financial Measures" section.
Management Comments
"Nova delivered a robust opening for 2022, outperforming guidance and locking down eight consecutive quarters of revenue growth. Our remarkable performance was driven by our burgeoning position across various industry sectors and technology nodes," commented Eitan Oppenhaim, President and Chief Executive Officer. "Following the ancosys acquisition, this is the first quarter that we are embedding chemical metrology sales results into our consolidated reporting. During the quarter, we continued to integrate ancosys as a division into Nova, developing a strong pipeline of products and opportunities in both the front-end and back-end semiconductor processes. The demand for Nova's solutions across dimensional, materials and chemical applications, continues to be strong and along with our record quarterly bookings and yearly backlog, we expect to continue our solid growth this year as well."
2022 Second Quarter Financial Outlook
Management provided an outlook for the second quarter, the period ending June 30, 2022. Based on current estimates, management expects:
- $133 million to $141 million in revenue
- $0.82 to $0.96 in diluted GAAP EPS
- $1.09 to $1.23 in diluted non-GAAP EPS
2022 First Quarter Results
Total revenues for the first quarter of 2022 were $134.0 million, an increase of 10% compared with the fourth quarter of 2021 and an increase of 59% compared with the first quarter of 2021.
Gross margin in the first quarter of 2022 was 57%, compared with 56% in the fourth quarter of 2021 and 57% in the first quarter of 2021.
Operating expenses in the first quarter of 2022 were $39.0 million, compared with $38.4 million in the fourth quarter of 2021 and $28.2 million in the first quarter of 2021.
On a GAAP basis, the Company reported net income of $34.2 million, or $1.07 per diluted share, in the first quarter of 2022. This is compared with net income of $22.2 million, or $0.73 per diluted share, in the fourth quarter of 2021, and net income of $17.6 million, or $0.60 per diluted share, in the first quarter of 2021.
On a non-GAAP basis, the Company reported net income of $41.5 million, or $1.30 per diluted share, in the first quarter of 2022. This is compared with net income of $32.8 million, or $1.08 per diluted share, in the fourth quarter of 2021, and net income of $20.5 million, or $0.70 per diluted share, in the first quarter of 2021.
Conference Call Information
Nova will host a conference call today, May 12, 2022, at 8:30 a.m. Eastern Time, to discuss the financial results and outlook. To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls five minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.
U.S. TOLL-FREE Dial-in Number: 1-800-239-9838
ISRAEL TOLL-FREE Dial-in Number: 1-809-407-724
INTERNATIONAL Dial-in Number: 1-323-794-2551
At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
3:30 p.m. Israel Time
The conference call will also be webcast live from a Link on Nova's website at https://www.novami.com/investors/events/.
A replay of the conference call will be available from May 12, 2022, at 11:30 a.m. Eastern Time to May 19, 2022, at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:
Replay Dial-in TOLL-FREE: 1-844-512-2921
Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-6671
Replay Pin Number: 2902650
A replay will also be available for 90 days on Nova's website at https://www.novami.com/investors/events/.
About Nova
Nova is a leading innovator and key provider of material, optical and chemical metrology solutions for advanced process control in semiconductor manufacturing. Nova delivers continuous innovation by providing state-of-the-art high-performance metrology solutions for effective process control throughout the semiconductor fabrication lifecycle. Nova's product portfolio, which combines high-precision hardware and cutting-edge software, provides its customers with deep insight into developing and producing the most advanced semiconductor devices. Nova's unique capability to deliver innovative solutions enables its customers to improve performance, enhance product yields and accelerate time to market. Nova acts as a partner to semiconductor manufacturers from its offices worldwide. Additional information may be found at Nova's website link - https://www.novami.com/.
Nova is traded on the Nasdaq and TASE, Nasdaq ticker symbol NVMI.
Use of Non-GAAP Adjusted Financial Measures
This press release provides financial measures that exclude amortization of acquired intangible assets, acquisition related expenses, inventory step-up and contingent consideration revaluation, stock-based compensation expenses, revaluation of operating lease liabilities, amortization of debt discount and issuance costs, tax effect of non-GAAP adjustment and taxes attributed to one-time elective tax settlement, as applicable, and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Nova's performance because they reflect our operational results and enhance management's and investors' ability to evaluate Nova's performance before charges or benefits considered by management to be outside Nova's ongoing operating results. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management believes that it is in the best interest of its investors to provide financial information that will facilitate comparison of both historical and future results and allow greater transparency to supplemental information used by management in its financial and operational decision making. A reconciliation of each GAAP to non-GAAP financial measure discussed in this press release is contained in the accompanying financial tables.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, such as statements regarding, but not limited to, anticipated growth opportunities and projections about our business and its future revenues, expenses and profitability. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied in those forward-looking statements. Factors that may affect our results, performance, circumstances or achievements include, but are not limited to, the following: catastrophic events such as the outbreak of COVID-19; increased information technology security threats and sophisticated computer crime; foreign political and economic risks; changes in U.S. trade policies; inability to protect our intellectual property; open source technology exposure; failure to compete effectively or to respond to the rapid technological changes; consolidation in our industry; difficulty in predicting the length and strength of any downturn or expansion period of the market we target; factors that adversely affect the pricing and demand for our product lines; dependency on a small number of large customers; dependency on a single manufacturing facility per product line; dependency on a limited number of suppliers; difficulty in integrating current or future acquisitions; lengthy sales cycle and customer delays in orders; political, economic, and military instability in Israel; risks related to our convertible notes; currency fluctuations; and quarterly fluctuations in our operating results. We cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading "Risk Factors" in Nova's Annual Report on Form 20-F for the year ended December 31, 2021 filed with the Securities and Exchange Commission on March 1, 2022. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Nova Ltd. does not assume any obligation to update the forward-looking information contained in this press release.
(Tables to Follow)
NOVA LTD. | ||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
(U.S. dollars in thousands) - (Unaudited) | ||
As of | ||
ASSETS | March 31, | December 31, |
Current assets | ||
Cash and cash equivalents | 105,193 | 126,698 |
Short-term interest-bearing bank deposits | 172,264 | 221,897 |
Marketable securities | 63,425 | 61,568 |
Trade accounts receivable, net | 77,985 | 68,446 |
Inventories | 96,193 | 78,665 |
Other current assets | 25,116 | 9,242 |
Total current assets | 540,176 | 566,516 |
Non-current assets | ||
Marketable securities | 132,011 | 137,415 |
Interest-bearing bank deposits | 3,595 | 3,672 |
Restricted interest-bearing bank deposits | 1,602 | 1,600 |
Deferred tax assets | 9,448 | 6,161 |
Severance pay funds | 1,308 | 1,327 |
Operating lease right-of-use assets | 45,809 | 30,627 |
Property and equipment, net | 44,367 | 34,460 |
Intangible assets, net | 49,308 | 2,601 |
Goodwill | 50,540 | 20,114 |
Other long-term assets | 744 | 661 |
Total non-current assets | 338,732 | 238,638 |
Total assets | 878,908 | 805,154 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Current liabilities | ||
Convertible senior notes, net | 195,432 | 183,037 |
Trade accounts payable | 35,973 | 36,218 |
Deferred revenues | 14,583 | 15,338 |
Operating lease current liabilities | 5,897 | 4,452 |
Other current liabilities | 59,775 | 48,885 |
Total current liabilities | 311,660 | 287,930 |
Non-current liabilities | ||
Accrued severance pay | 3,728 | 3,686 |
Operating lease long-term liabilities | 47,293 | 33,450 |
Long-term deferred tax liability | 13,743 | - |
Other long-term liabilities | 6,936 | 6,334 |
Total non-current liabilities | 71,700 | 43,470 |
Shareholders' equity | 495,548 | 473,754 |
Total liabilities and shareholders' equity | 878,908 | 805,154 |
NOVA LTD. | ||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
(U.S. dollars in thousands, except per share data) - (Unaudited) | ||
Three months ended | ||
2022 | 2021 | |
Revenues: | ||
Products | 109,912 | 66,283 |
Services | 24,045 | 17,850 |
Total revenues | 133,957 | 84,133 |
Total cost of revenues | 57,807 | 36,203 |
Gross profit | 76,150 | 47,930 |
Operating expenses: | ||
Research and development, net | 19,129 | 14,518 |
Sales and marketing | 12,246 | 9,540 |
General and administrative | 6,056 | 3,539 |
Amortization of intangible assets | 1,613 | 575 |
Total operating expenses | 39,044 | 28,172 |
Operating income | 37,106 | 19,758 |
Financing income, net | 1,218 | 424 |
Income before taxes on income | 38,324 | 20,182 |
Income tax expenses | 4,162 | 2,566 |
Net income for the period | 34,162 | 17,616 |
Earnings per share: | ||
Basic | 1.20 | 0.62 |
Diluted | 1.07 | 0.60 |
Shares used in calculation of earnings per share (in thousands): | ||
Basic | 28,579 | 28,214 |
Diluted | 31,968 | 29,306 |
NOVA LTD. | ||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
(U.S. dollars in thousands) - (Unaudited) | ||
Three months ended | ||
2022 | 2021 | |
Cash flows from operating activities: | ||
Net income | 34,162 | 17,616 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation of property and equipment | 2,035 | 1,579 |
Amortization of intangible assets | 1,613 | 575 |
Amortization of premium and accretion of discount on marketable securities, net | 829 | - |
Amortization of debt discount and issuance costs | 320 | 1,034 |
Share-based compensation | 3,860 | 2,222 |
Net effect of exchange rate fluctuation | 793 | 362 |
Changes in assets and liabilities: | ||
Trade accounts receivables, net | 470 | 3,494 |
Inventories | (6,898) | (4,417) |
Other current and long-term assets | (15,996) | (1,162) |
Deferred tax assets, net | (2,609) | (598) |
Operating lease right-of-use assets | 912 | 406 |
Trade accounts payables | (1,941) | 439 |
Deferred revenues | (744) | 9,021 |
Operating lease liabilities | (806) | (1,266) |
Other current and long-term liabilities | (3,151) | 3,718 |
Accrued severance pay, net | 61 | (38) |
Net cash provided by operating activities | 12,910 | 32,985 |
Cash flows from investment activities: | ||
Acquisition of subsidiary, net of acquired cash | (78,469) | - |
Change in short-term and long-term interest-bearing bank deposits | 49,632 | (55,805) |
Investment in marketable securities | (16,836) | - |
Proceeds from maturities of marketable securities | 15,770 | - |
Purchase of property and equipment | (3,718) | (488) |
Net cash used in investing activities | (33,621) | (56,293) |
Net cash provided by financing activities | - | - |
Effect of exchange rate fluctuations on cash and cash equivalents | (794) | (238) |
Changes in cash and cash equivalents | (21,505) | (23,546) |
Cash and cash equivalents - beginning of period | 126,698 | 232,304 |
Cash and cash equivalents - end of period | 105,193 | 208,758 |
NOVA LTD. | ||||
RECONCILIATION OF GAAP TO NON-GAAP RESULTS | ||||
(U.S. dollars in thousands, except percentage and per share data) - (Unaudited) | ||||
Three months ended | ||||
March 31, | December 31, | March 31, | ||
GAAP gross profit | 76,150 | 68,249 | 47,930 | |
Stock-based compensation* | 883 | 803 | 418 | |
Acquisition-related inventory step-up | 2,606 | - | - | |
Non-GAAP gross profit | 79,639 | 69,052 | 48,348 | |
GAAP gross margin as a percentage of revenues | 57% | 56% | 57% | |
Non-GAAP gross margin as a percentage of revenues | 59% | 57% | 57% | |
GAAP operating income | 37,106 | 29,893 | 19,758 | |
Stock-based compensation* | 3,860 | 3,496 | 2,222 | |
Acquisition-related inventory step-up | 2,606 | - | - | |
Acquisition-related expenses and contingent consideration revaluation | 1,355 | 999 | - | |
Amortization of acquired intangible assets | 1,613 | 735 | 575 | |
Non-GAAP operating income | 46,540 | 35,123 | 22,555 | |
GAAP operating margin as a percentage of revenues | 28% | 25% | 23% | |
Non-GAAP operating margin as a percentage of revenues | 35% | 29% | 27% | |
GAAP net income | 34,162 | 22,226 | 17,616 | |
Stock-based compensation* | 3,860 | 3,496 | 2,222 | |
Acquisition-related inventory step-up | 2,606 | - | - | |
Acquisition-related expenses and contingent consideration revaluation | 1,355 | 999 | - | |
Amortization of acquired intangible assets | 1,613 | 735 | 575 | |
Amortization of debt discount and issuance costs | 320 | 1,075 | 1,034 | |
Revaluation of operating lease liabilities | (546) | 907 | (860) | |
Tax effect of non-GAAP adjustments | (1,883) | (402) | (102) | |
Taxes attributed to one-time elective tax settlement | - | 3,716 | - | |
Non-GAAP net income | 41,487 | 32,752 | 20,485 | |
GAAP basic earnings per share | 1.20 | 0.78 | 0.62 | |
Non-GAAP basic earnings per share | 1.45 | 1.15 | 0.73 | |
GAAP diluted earnings per share | 1.07 | 0.73 | 0.60 | |
Non-GAAP diluted earnings per share | 1.30 | 1.08 | 0.70 | |
Shares used for calculation of earnings per share | ||||
Basic | 28,579 | 28,539 | 28,214 | |
Diluted | 31,968 | 30,285 | 29,306 | |
* Stock-based compensation for the three months ended March 31, 2022 included in – Cost of revenues - 883; Research and development, net – 1,525; Sales and marketing – 786; General and administrative – 666
NOVA LTD. | ||
SUPPLEMENTAL INFORMATION - RECONCILIATION OF SECOND QUARTER 2022 | ||
GAAP TO NON-GAAP GUIDANCE | ||
(Unaudited) | ||
Low | High | |
Estimated GAAP net income per diluted share | 0.82 | 0.96 |
Estimated non-GAAP items: | ||
Stock-based compensation | 0.13 | 0.13 |
Amortization of acquired intangible assets | 0.06 | 0.06 |
Acquisition-related expenses and contingent consideration revaluation | 0.07 | 0.07 |
Acquisition-related inventory step-up | 0.01 | 0.01 |
Amortization of issuance costs | 0.01 | 0.01 |
Tax effect of non-GAAP adjustments | (0.01) | (0.01) |
Estimated non-GAAP net income per diluted share | 1.09 | 1.23 |
Company Contact:
Dror David, Chief Financial Officer
Tel: +972-73-229-5760
E-mail - investors@novami.com
Nova website link - https://www.novami.com/
Investor Relations Contact:
Miri Segal MS-IR LLC
Tel: +917-607-8654
E-mail - msegal@ms-ir.com
SOURCE Nova
Share this article