Market Newsdesk

November 12, 2020 4:09 pm

Trecora Resources Announces Upcoming Financial Conference Schedule

PR Newswire

SUGAR LAND, Texas, Nov. 12, 2020 /PRNewswire/ — Trecora Resources (NYSE: TREC), a leading provider of specialty hydrocarbons and specialty waxes, today announced its upcoming conference schedule:

Sidoti Virtual Microcap Conference 2020
Date and Time: Thursday, November 19, 2020 from 3:15 p.m. – 3:45 p.m. ET
(12:15 p.m. – 12:45 p.m. PT)
* Pat Quarles, President & CEO, and Sami Ahmad, CFO, will be available for one-on-one meetings throughout the day.

Investors interested in scheduling a meeting should contact their Sidoti representative.

There will be a live webcast for the Sidoti Virtual Microcap Conference with replays available for 90 days. The slides that accompany the webcast will be available on the Company’s website: www.trecora.com. To listen to the webcast please click on the link below:

Sidoti Virtual Microcap Conference 2020
https://sidoti.zoom.us/webinar/register/WN_OapwQroURLiFGnmGv7dNiw

About Trecora Resources (TREC)
TREC owns and operates a specialty petrochemicals facility specializing in high purity hydrocarbons and other petrochemical manufacturing and a specialty wax facility, both located in Texas, and provides custom processing services at both facilities.

Investor Relations Contact:
Jason Finkelstein
The Piacente Group, Inc.
212-481-2050
[email protected]

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SOURCE Trecora Resources

November 12, 2020 4:09 pm

Poseida Therapeutics Reports Operational Update and Financial Results for Third Quarter 2020

PR Newswire

SAN DIEGO, Nov. 12, 2020 /PRNewswire/ — Poseida Therapeutics, Inc. (Nasdaq: PSTX), a clinical-stage biopharmaceutical company utilizing proprietary gene engineering platform technologies to create cell and gene therapeutics with the capacity to cure, today announced an operational update and financial results for the quarter ended September 30, 2020.

“During our first quarter as a publicly traded company, we continued to maintain our focus on research innovation and advancement of our clinical programs, while also building new strategic collaborations,” said Eric Ostertag, M.D., Ph.D., Chief Executive Officer of Poseida. “In early September, we released data demonstrating new manufacturing technology that has the potential to create more efficacious cell therapies and have now implemented that technology across our entire CAR-T pipeline. In October, we announced a research collaboration with TScan Therapeutics to evaluate the feasibility of producing a novel cell-based therapeutic for the treatment of COVID-19. This collaboration will expand our platforms to include T cell receptor-engineered T cell (TCR-T) therapies and further expand the indications we can potentially treat beyond oncology.”

Program Updates

P-PSMA-101
P-PSMA-101 is a solid tumor autologous CAR-T product candidate being developed to treat patients with metastatic castrate resistant prostate cancer. The program started enrollment in May 2020. On November 2, 2020, the Company announced that a clinical hold placed on the trial was lifted by the FDA. The trial has now resumed with minor protocol modifications to increase patient compliance and safety. The protocol changes are specific to the P-PSMA-101 program and do not affect the ongoing P-BCMA-101 clinical trial. The Company now expects to provide an initial data update in mid-2021.

P-BCMA-101
P-BCMA-101 is an autologous CAR-T product candidate for the treatment of patients with relapsed/refractory multiple myeloma. The program is currently enrolling in an expanded Phase 1 clinical trial to inform the potentially registrational Phase 2 clinical trial. Phase 1 dose expansion enrollment continues, although at a slower pace than planned due in part to the COVID-19 pandemic. Further, the Company expects to make a Phase 2 dosing decision on P-BCMA-101 by early 2021.

At the CAR-TCR Digital Week meeting on September 16, 2020, the Company presented data related to CAR-T manufacturing optimizations and also illustrated the impact of these optimizations with preliminary clinical analysis of the first patients dosed in the P-BCMA-101 Phase 1 expansion trial.

P-BCMA-ALLO1
The Company’s first allogeneic CAR-T product candidate, P-BCMA-ALLO1, is in development for the treatment of relapsed/refractory multiple myeloma and is designed to be fully allogeneic, with genetic edits designed to reduce or eliminate both host-vs-graft and graft-vs-host alloreactivity. The program is proceeding toward an IND filing which is expected in the first half 2021.

P-MUC1C-ALLO1
This allogeneic CAR-T product candidate is in preclinical development with the potential to treat a wide range of solid tumors, including breast and ovarian cancers. The program is proceeding with an expected IND filing in 2021.

P-OTC-101 Gene Therapy Program
P-OTC-101 is the Company’s first liver-directed gene therapy program for in vivo treatment of urea cycle disease caused by congenital mutations in the OTC gene, a condition characterized by high unmet medical need. The Company now expects to submit an IND in 2022 due to pandemic related factors, including longer timelines due to COVID-19 vaccine-related capacity constraints at certain vendors.

Early Stage Development Programs
For programs in early development, including the fully allogeneic Dual CAR programs, P-PSMA-ALLO1 and P-MMUT-101, the Company expects to update specific guidance at a later date, as it gains further clarity on the timelines and any impacts of the COVID-19 pandemic.

Other Operational Updates and Upcoming Events

Collaboration agreement with TScan Therapeutics to explore developing allogeneic T cell receptor therapies for the treatment of COVID-19
In October, the Company and TScan Therapeutics announced a research collaboration and license agreement to explore the use of the Company’s fully allogeneic stem cell memory T cell platform in combination with TScan’s proprietary TCR platform and findings related to SARS-CoV-2. The collaboration will allow the Company to explore platform and T cell technology utilizing one or more TCRs in allogeneic cell therapy applications.

Piper Sandler 32nd Annual Virtual Healthcare Conference
The Company is participating in a virtual conference that will be made available at 10 am ET on November 23, 2020, ahead of the conference start scheduled for December 1, 2020. The audio recording of the presentation, formatted as a fireside chat, will be available through the conference coordinators and posted on the Company’s website.

62nd American Society of Hematology (ASH) Annual Meeting and Exposition
The Company plans to provide an update on the P-BCMA-101 Phase 1 expansion trial in early December with an oral presentation at the 62nd American Society of Hematology (ASH) Annual Meeting and Exposition scheduled for Saturday, December 5, 2020.

Financial Results

Research and Development Expenses
Research and development expenses were $27.0 million for the three months ended September 30, 2020, compared to $15.7 million for the same period in 2019. For the nine months ended September 30, 2020, research and development expenses were $75.6 million, compared to $41.2 million for the same period in 2019. The increase in both periods was primarily due to increased headcount, external costs related to preclinical programs and clinical stage programs, including the ongoing P-BCMA-101 and P-PSMA-101 clinical trials, and internal costs related to facilities development.

General and Administrative Expenses
General and administrative expenses were $6.5 million for the three months ended September 30, 2020, compared to $4.0 million for the same period in 2019. General and administrative expenses were $15.6 million for the nine months ended September 30, 2020, compared to $14.4 million for the same period in 2019. The increase in both periods was primarily due to increased headcount and professional fees associated with becoming a publicly traded company.

Net Losses
Net losses were $34.4 million and $93.6 million for the three and nine months ended September 30, 2020, respectively, and $21.0 million and $62.9 million for the three and nine months ended September 30, 2019, respectively.

Cash Position
As of September 30, 2020, cash, cash equivalents and marketable securities were $341.5 million. Net proceeds from the Company’s initial public offering, which closed in July 2020, were $205.7 million.

About Poseida Therapeutics, Inc.
Poseida Therapeutics is a clinical-stage biopharmaceutical company dedicated to utilizing our proprietary gene engineering platform technologies to create next generation cell and gene therapeutics with the capacity to cure. We have discovered and are developing a broad portfolio of product candidates in a variety of indications based on our core proprietary platforms, including our non-viral piggyBac^® DNA Modification System, Cas-CLOVER™ site-specific gene editing system and nanoparticle- and AAV-based gene delivery technologies. Our core platform technologies have utility, either alone or in combination, across many cell and gene therapeutic modalities and enable us to engineer our wholly-owned portfolio of product candidates that are designed to overcome the primary limitations of current generation cell and gene therapeutics.

Forward-Looking Statements
Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements regarding, among other things, the potential benefits of Poseida’s technology platforms and product candidates, Poseida’s plans and strategy with respect to developing its technologies and product candidates and anticipated timelines and milestones with respect to Poseida’s development programs. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. These forward-looking statements are based upon Poseida’s current expectations and involve assumptions that may never materialize or may prove to be incorrect. Actual results could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties, which include, without limitation, risks and uncertainties associated with development and regulatory approval of novel product candidates in the biopharmaceutical industry and the other risks described in Poseida’s filings with the Securities and Exchange Commission. All forward-looking statements contained in this press release speak only as of the date on which they were made. Poseida undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

Poseida Therapeutics, Inc. Selected Financial Data (Unaudited) (In thousands, except share amounts)

STATEMENTS OF OPERATIONS

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020	2019
Operating expenses:
Research and development	$ 27,016		$ 15,696		$ 75,636	$ 41,189
General and administrative	6,458		4,007		15,553	14,449
Increase in contingent consideration	—		1,060		—	6,683
Total operating expenses	33,474		20,763		91,189	62,321
Loss from operations	(33,474)		(20,763)		(91,189)	(62,321)
Other income (expense):
Interest expense	(848)		(935)		(2,654)	(2,633)
Other income (expense), net	(92)		744		216	2,040
Net loss before income tax	(34,414)		(20,954)		(93,627)	(62,914)
Income tax benefit	—		—		—	—
Net loss	$ (34,414)		$ (20,954)		$ (93,627)	$ (62,914)
Net loss per share attributable to common stockholders, basic and diluted	$ (0.63)		$ (1.65)		$ (3.43)	$ (5.06)
Weighted-average shares of common stock, basic and diluted	54,973,788		12,665,834		27,324,297	12,427,367


SELECTED BALANCE SHEET DATA

		September 30, 2020		December 31, 2019
Cash, cash equivalents and short-term investments		$ 341,457		$ 125,318
Total assets		405,171		146,996
Total liabilities		109,335		74,334
Convertible preferred stock		–		222,173
Total stockholders’ equity (deficit)		295,836		(149,511)

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SOURCE Poseida Therapeutics, Inc.

November 12, 2020 4:09 pm

Inpixon Reports Third Quarter 2020 Financial Results and Provides Corporate Update

Revenue for the Third Quarter of 2020 Increases 66% Year-over-Year

Added Key Capabilities to Indoor Intelligence Platform, Expanded Customer Base and Opened New Verticals Resulting from Strategic Acquisitions

Conference Call to be Held Today at 4:30 p.m. Eastern Time

PR Newswire

PALO ALTO, Calif., Nov. 12, 2020 /PRNewswire/ — Inpixon (Nasdaq: INPX), the Indoor Intelligence™ company, today provided a business update and reported financial results for the third quarter of 2020.

Recent Milestones:

Acquired Nanotron, a global location awareness technology company; Oct. 2020 acquisition increases revenue and is expected to be accretive to earnings
Acquired “blue dot” on-device positioning technology and intellectual property assets in Aug. 2020, expanding Inpixon’s Indoor Intelligence capabilities on mobile devices
Acquired an exclusive global distribution and development license for SYSTAT and SigmaPlot software suite of products in June 2020; acquisition increases revenue and is expected to be accretive to earnings
Inpixon RF Video Connector integrated into Genetec Security Center Omnicast for sensor fusion-enabled video analytics
Participated in CNN-moderated “Reclaim Your Workplace: Creating a Resilient Environment Post-Pandemic” roundtable
Expanded Latin American reach — executed sales and distribution agreement with importer and distributor, GASCOM
Inpixon and FSI team for facility management solutions incorporating intelligent maps to combat COVID-19
Inpixon and The CXApp collaborate on desk-booking and enterprise campus apps plus multi-technology social distancing and contact tracing methodologies designed to reduce COVID-19 infections and enhance incident response
Received FCC certification for ultra-wideband (UWB) module

Nadir Ali, CEO of Inpixon, commented, “This has been a productive quarter, to say the least. In the beginning of the year, we set out a goal to grow our business in terms of revenue and to continue the path of innovation we initiated last year in order to develop the most comprehensive, intelligent platform available in the market for Indoor Intelligence. By successfully completing a number of key acquisitions, in 2020 we increased our technical advantage by adding key capabilities, such as on-device positioning, which can be leveraged by device users to understand where they are within a building, and two-way ranging, allowing for the measurement of distance between two devices. We also acquired best-in-class UWB technology, permitting finer, more precise positioning capabilities down to 30 cm with the acquisition of Nanotron Technologies GmbH, a market leader in UWB technologies.

“With the transactions completed this year, we expanded our operations to Europe, as well as our customer base internationally in Europe, Asia, Africa, South America and the Middle East, and our partner relationships with marquee distribution and technology partners. We have expanded our reach to new verticals such as mine safety, livestock and manufacturing, and added additional use cases such as collision avoidance, safety zones and RTLS. We also strengthened our intellectual property portfolio by acquiring a number of patents, trademarks and other rights.

“Even during an unprecedented year of challenges faced by people and businesses throughout the world, Inpixon has transformed as an organization, becoming financially and operationally stronger. We have expanded our technological capabilities and product offerings as a premier provider of Indoor Intelligence solutions with the ability to offer our customers insights about their spaces that we believe far exceed our competitors. Importantly, we have become a one-stop solution for Indoor Intelligence. Rather than only selling products or services to address a single issue or as part of a total solution typically requiring the integration of offerings by multiple vendors, we can provide a comprehensive solution to address certain key pain points of our customers. We are approaching global enterprises, including some well-known Fortune 500 companies, offering what we believe is unparalleled Indoor Intelligence capabilities under one roof to address safety and security concerns, increase operational efficiencies and improve their bottom line. We believe this approach has resonated extremely well among customers, partners, distributors and resellers.

“With approximately $31.4 million of cash as of September 30, 2020, we believe we are well positioned for continued growth and have the flexibility to execute on our growth strategy. We are focused on creating long-term shareholder value, and in 2020 we concentrated on continuing to enhance and expand our capabilities to be a single-source provider of premier Indoor Intelligence solutions. Our efforts are aimed at scaling the business both organically and through M&A, and I’m confident that despite the challenges of this year with COVID-19, our growth strategy is working as indicated by the 66% increase in revenue for the third quarter ended September 30, 2020, compared to the same period last year. This growth reflects a recovery back to the growth rates we were achieving prior to the shelter-in-place directives we had to contend with in Q2 2020, and I expect this growth trend to continue in Q4 2020.”

Financial Results

Revenues for the third quarter ended September 30, 2020 were $2.55 million compared to $1.53 million for the comparable period in the prior year for an increase of $1.02 million or approximately 66%. The increase in revenues was primarily attributable to an increase in sales in our Aware and Mapping product lines and the addition of sales from the new Systat licensing product line. Gross profit for the three months ended September 30, 2020 was $1.9 million compared to $1.2 million for the comparable period in the prior year, an increase of 66%. The gross profit margin for the three months ended September 30, 2020 and 2019 was 75%. Net loss attributable to stockholders of Inpixon for the three months ended September 30, 2020 was $7.5 million compared to a net loss of $6.6 million for the comparable period in the prior year. The higher loss of approximately $0.9 million was primarily attributable the higher operating expenses offset by the increased revenue during the three months ended September 30, 2020. Non-GAAP Adjusted EBITDA for the three months ended September 30, 2020 was a loss of $4.6 million compared to a loss of $2.4 million for the prior period in 2019. EBITDA is defined as net income (loss) before interest, provision for income taxes, and depreciation and amortization. Adjusted EBITDA is used by Inpixon management as a metric by which it manages the business. It is defined as EBITDA plus adjustments for other income or expense items, non-recurring items and other non-cash items including stock-based compensation.

Proforma non-GAAP net loss per basic and diluted common share for the three months ended September 30, 2020 was a loss of $0.13 per share compared to a loss of $7.44 per share for the prior period in 2019. Proforma non-GAAP net income (loss) per share is used by the Company’s management as an evaluation tool as it manages the business and is defined as net income (loss) per basic and diluted share adjusted for stock based compensation, amortization of intangibles, provision for doubtful accounts, severance costs, acquisition costs, costs associated with public offerings and one time charges including loss on the exchange of debt for equity and provision for valuation allowances.

Conference Call

Management will host a conference call at 4:30 p.m. Eastern Time on Thursday, November 12, 2020 to discuss the Company’s financial results for the third quarter ended September 30, 2020 as well as the Company’s corporate progress and other developments.

The conference call will be available via telephone by dialing toll free 866-342-8591 for U.S. callers or +1 203-518-9713 for international callers, or on the Company’s Investors section of the website: ir.inpixon.com.

A webcast replay will be available on the Company’s Investors section of the website (ir.inpixon.com) through February 12, 2021. A telephone replay of the call will be available approximately one hour following the call, through November 19, 2020 and can be accessed by dialing 877-481-4010 for U.S. callers or +1 919-882-2331 for international callers and entering conference ID: 38565.

About Inpixon

Inpixon® (Nasdaq: INPX) is the Indoor Intelligence™ company that specializes in capturing, interpreting and giving context to indoor data so it can be translated into actionable intelligence. The company’s Indoor Intelligence platform ingests diverse data from IoT, third-party and proprietary sensors designed to detect and position active cellular, Wi-Fi, UWB and Bluetooth devices. Paired with a high-performance data analytics engine, patented algorithms, and advanced mapping technology, Inpixon’s solutions are leveraged by a multitude of industries to do good with indoor data. This multidisciplinary depiction of indoor data enables users to increase revenue, decrease costs, and enhance safety. Inpixon customers can boldly take advantage of location awareness, analytics, sensor fusion and the Internet of Things (IoT) to uncover the untold stories of the indoors. For the latest insights, follow Inpixon on LinkedIn, Twitter, and visit inpixon.com.

Safe Harbor Statement

All statements in this release that are not based on historical fact are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. While management has based any forward-looking statements included in this release on its current
expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties and other factors, many of which are outside of the control of Inpixon and its subsidiaries, which could cause actual results to materially differ from such statements. Such risks, uncertainties, and other factors include, but are not limited to, the fluctuation of economic conditions, the impact of COVID-19 on Inpixon’s results of operations,
our ability to integrate the businesses we acquire into our existing business
,
the performance of management and employees, the regulatory landscape as it relates to privacy regulations and their applicability to Inpixon’s technology, Inpixon’s ability to maintain compliance with Nasdaq’s minimum bid price requirement and other continued listing requirements, including during a panel monitoring period ending on February 5, 2021, the ability to obtain financing, competition, general economic conditions and other factors that are detailed in Inpixon’s periodic and current reports available for review at sec.gov. Furthermore, Inpixon
operates in a highly competitive and rapidly changing environment where new and unanticipated risks may arise. Accordingly, investors should not place any reliance on forward-looking statements as a prediction of actual results. Inpixon disclaims any intention to, and undertakes no obligation to, update or revise forward-looking statements.

Non-GAAP Financial Measures

Management believes that certain financial measures not in accordance with generally accepted accounting principles in the United States (“GAAP”) are useful measures of operations. EBIDTA, Adjusted EBITDA and pro forma net loss per share are non-GAAP measures. Inpixon defines “EBITDA” as net income (loss) before interest, provision for (benefit from) income taxes, and depreciation and amortization. Management uses Adjusted EBITDA as the matrix in which it manages the business and Inpixon defines “Adjusted EBITDA” as EBITDA plus adjustments for deemed dividends, other income or expense items, non-recurring items and non-cash items. Inpixon defines “pro forma net loss per share” as GAAP net loss per share adjusted for deemed dividends, stock based compensation, amortization of intangibles, provision for doubtful accounts, severance costs, acquisition costs, costs associated with public offerings and one time charges including loss on the exchange of debt for equity and provision for valuation allowances.

Management provides Adjusted EBITDA and pro forma net loss per share measures so that investors will have the same financial information that management uses, which may assist investors in assessing Inpixon’s performance on a period-over-period basis. Adjusted EBITDA or pro forma net loss per share is not a measure of financial performance under GAAP, and should not be considered an alternative to net income (loss) or any other measure of performance under GAAP, or to cash flows from operating, investing or financing activities as an indicator of cash flows or as a measure of liquidity. Adjusted EBITDA and pro forma net loss per share have limitations as analytical tools and should not be considered either in isolation or as a substitute for analysis of Inpixon’s results as reported under GAAP.

For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, please see the “Reconciliation of Non-GAAP Financial Measures” table accompanying this press release.

Inpixon Contacts

Media relations and general inquiries:

Inpixon
Email: [email protected]
Web: inpixon.com/contact-us

Investor relations:

Crescendo Communications, LLC
Tel: +1 212-671-1020
Email: [email protected]

INPIXON AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except number of shares and par value data)

	As of
	September 30, 2020		December 31, 2019
	(Unaudited)		(Audited)
ASSETS
Current Assets
Cash and cash equivalents	$	31,376	$	4,777
Accounts receivable, net		1,948		1,108
Notes and other receivables		378		74
Inventory		414		400
Prepaid assets and other current assets		1,144		406
Total Current Assets		35,260		6,765

Property and equipment, net		553		145
Operating lease right-of-use asset, net		1,622		1,585
Software development costs, net		1,729		1,544
Intangible assets, net		10,761		8,400
Goodwill		2,555		2,070
Receivable from related party		—		616
Other assets		113		94
Total Assets	$	52,593	$	21,219

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable	$	813	$	2,383
Accrued liabilities		1,914		1,863
Operating lease obligation		572		776
Deferred revenue		1,842		912
Short-term debt		6,150		7,304
Acquisition liability		750		502
Total Current Liabilities		12,041		13,740

Long Term Liabilities
Operating lease obligations, noncurrent		1,074		837
Other liabilities		7		7
Deferred tax liability, noncurrent		—		87
Acquisition liability, noncurrent		—		500
Total Liabilities		13,122		15,171

Commitments and Contingencies		—		—

Stockholders’ Equity
Preferred Stock – $0.001 par value; 5,000,000 shares authorized, consisting of Series 4 Convertible Preferred Stock – 10,415 shares authorized; 1 and 1 issued, and 1 and 1 outstanding as of September 30, 2020 and December 31, 2019, respectively, Series 5 Convertible Preferred Stock – 12,000 shares authorized; 126 and 126 issued, and 126 and 126 outstanding as of September 30, 2020 and December 31, 2019, respectively.		—		—
Common Stock – $0.001 par value; 250,000,000 shares authorized; 42,259,314 and 4,234,923 issued and 42,259,313 and 4,234,922 outstanding as of September 30, 2020 and December 31, 2019, respectively.		42		4
Additional paid-in capital		212,913		158,382
Treasury stock, at cost, 1 share		(695)		(695)
Accumulated other comprehensive income		(130)		94
Accumulated deficit (excluding $2,442 reclassified to additional paid in capital in quasi-reorganization)		(172,710)		(151,763)
Stockholders’ Equity Attributable to Inpixon		39,420		6,022

Non-controlling interest		51		26

Total Stockholders’ Equity		39,471		6,048

Total Liabilities and Stockholders’ Equity	$	52,593	$	21,219

INPIXON AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except per share data)

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
	(Unaudited)				(Unaudited)
Revenues	$	2,554	$	1,534	$	5,434	$	4,387
Cost of Revenues		645		382		1,459		1,109

Gross Profit		1,909		1,152		3,975		3,278

Operating Expenses
Research and development		1,717		926		4,329		2,677
Sales and marketing		1,703		847		3,862		2,161
General and administrative		4,103		3,521		10,371		9,890
Acquisition related costs		344		573		540		1,220
Amortization of intangibles		288		969		1,811		2,602
Total Operating Expenses		8,155		6,836		20,913		18,550

Loss from Operations		(6,246)		(5,684)		(16,938)		(15,272)

Other Income (Expense)
Interest expense, net		(537)		(1,190)		(1,934)		(2,053)
Provision for valuation allowance on held for sale loan		(679)		—		(1,514)		—
Loss on exchange of debt for equity		—		(27)		(132)		(188)
Other income (expense)		11		289		(488)		518
Total Other Income (Expense)		(1,205)		(928)		(4,068)		(1,723)

Net Loss from Operations, before tax		(7,451)		(6,612)		(21,006)		(16,995)
Income tax benefit		—		33		87		35
Net Loss		(7,451)		(6,579)		(20,919)		(16,960)

Net Income Attributable to Non-controlling Interest		16		5		25		9

Net Loss Attributable to Stockholders of Inpixon	$	(7,467)	$	(6,584)	$	(20,944)	$	(16,969)

Deemed dividend for triggering of warrant down round feature		—		—		—		(1,250)
Net Loss Attributable to Common Stockholders	$	(7,467)	$	(6,584)	$	(20,944)	$	(18,219)

Net Loss Per Share – Basic and Diluted	$	(0.18)	$	(12.68)	$	(0.90)	$	(65.89)

Weighted Average Shares Outstanding
Basic and Diluted		41,544,961		519,257		23,203,004		276,499


Comprehensive Loss
Net Loss	$	(7,451)	$	(6,579)	$	(20,919)	$	(16,960)
Unrealized foreign exchange gain/(loss) from cumulative translation adjustments		70		(67)		(225)		(36)
Comprehensive Loss	$	(7,381)	$	(6,646)	$	(21,144)	$	(16,996)

INPIXON AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

	For the Nine Months Ended
	September 30,
	2020		2019
	(Unaudited)

Cash Flows Used In Operating Activities
Net loss	$	(20,919)	$	(16,960)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		568		826
Amortization of intangible assets		1,929		2,602
Amortization of right of use asset		322		267
Stock based compensation		941		2,618
Amortization of technology		—		50
Loss on exchange of debt for equity		132		188
Amortization of debt discount		2,272		1,543
Accrued interest income, related party		(32)		—
Provision for doubtful accounts		—		358
Provision for the valuation allowance held for sale loan		1,514		—
Provision for the valuation allowance related party receivable		648		—
Income tax benefit		(87)		(35)
Other		74		23

Changes in operating assets and liabilities:
Accounts receivable and other receivables		(1,111)		(1,241)
Inventory		(14)		(194)
Other current assets		(814)		(45)
Other assets		(20)		(284)
Accounts payable		(1,359)		1,140
Accrued liabilities		54		56
Deferred revenue		224		(369)
Operating lease liabilities		(325)		—
Other liabilities		453		400
Total Adjustments		5,369		7,903
Net Cash Used in Operating Activities		(15,550)		(9,057)

Cash Flows Used in Investing Activities
Purchase of property and equipment		(546)		(58)
Investment in capitalized software		(688)		(658)
Cash paid for the acquisition of Jibestream		—		(3,714)
Cash paid for the acquisition of GTX		—		(250)
Cash paid for the acquisition of Locality		—		(204)
Cash paid for the Systat Licensing Agreement		(2,200)		—
Cash paid for the acquisition of Ten Degrees		(1,500)		—
Net Cash Flows Used in Investing Activities		(4,934)		(4,884)

Cash Flows From Financing Activities
Net (repayments) proceeds to bank facility		(150)		237
Net proceeds from issuance of common stock, preferred stock and warrants		—		14,791
Net proceeds from issuance of common stock		44,041		—
Net repayments of notes payable		(74)		(71)
Loans to related party		(1,806)		(9,866)
Advances to related party		—		(15)
Repayments from related party		292		1,683
Loan to Jibestream		—		(141)
Loan to GTX		—		(50)
Net proceeds from promissory notes		5,000		6,750
Repayment of acquisition liability to Locality shareholders		(250)		—
Net Cash Provided By Financing Activities		47,053		13,318

Effect of Foreign Exchange Rate on Changes on Cash		(42)		(36)

Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash		26,527		(659)

Cash, Cash Equivalents and Restricted Cash – Beginning of period		4,849		1,224

Cash, Cash Equivalents and Restricted Cash – End of period	$	31,376	$	565

Reconciliation of Non-GAAP Financial Measures:


(In thousands)	For the Three Months Ended				For the Nine Months Ended
(In thousands)	September 30,				September 30,
	2020		2019		2020		2019
Net loss attributable to common stockholders	$	(7,467)	$	(6,584)	$	(20,944)	$	(18,219)
Adjustments:
Non-recurring one-time charges:
Loss on exchange of debt for equity		—		27		132		188
Provision for valuation allowance on held for sale loan		679		—		1,514		—
Provision for the valuation allowance related party receivable		—		—		648		—
Settlement of litigation		—		—		—		6
Acquisition transaction/financing costs		344		573		540		1,220
Costs associated with public offering		—		—		—		50
Severance		—		26		—		126
Bad debts expense/provision		444		253		444		358
Deemed dividend for triggering of warrant down round feature		—		—		—		1,250
Stock-based compensation – compensation and related benefits		256		871		941		2,618
Interest expense, net		537		1,190		1,934		2,054
Depreciation and amortization		589		1,268		2,497		3,428
Income tax benefit		—		(33)		(87)		(35)
Adjusted EBITDA	$	(4,618)	$	(2,409)	$	(12,381)	$	(6,956)



(In thousands, except share data)	For the Three Months Ended				For the Nine Months Ended
(In thousands, except share data)	September 30,				September 30,
	2020		2019		2020		2019
Net loss attributable to common stockholders	$	(7,467)	$	(6,584)	$	(20,944)	$	(18,219)
Adjustments:
Non-recurring one-time charges:
Loss on exchange of debt for equity		—		27		132		188
Provision for valuation allowance on held for sale loan		679		—		1,514		—
Provision for the valuation allowance related party receivable		—		—		648		—
Settlement of litigation		—		—		—		6
Acquisition transaction/financing costs		344		573		540		1,220
Costs associated with public offering		—		—		—		50
Severance		—		26		—		126
Bad debts expense/provision		444		253		444		358
Deemed dividend for triggering of warrant down round feature		—		—		—		1,250
Stock-based compensation – compensation and related benefits		256		871		941		2,618
Amortization of intangibles		288		969		1,811		2,602
Proforma non-GAAP net loss		$ (5,456)		$(3,865)		$ (14,914)		$(9,801)
Proforma non-GAAP net loss per basic and diluted common share		$ (0.13)	$	(7.44)		$ (0.64)	$	(35.45)
Weighted average basic and diluted common shares outstanding		41,544,961		519,257		23,203,004		276,499

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SOURCE Inpixon

November 12, 2020 4:09 pm

Harte Hanks Reports Third Quarter 2020 Financial Results

PR Newswire

AUSTIN, Texas, Nov. 12, 2020 /PRNewswire/ — Harte Hanks, Inc. (OTCQX: HRTH), an industry leader in data-driven, omnichannel marketing today announced financial results for the third quarter ended September 30, 2020.

Recent Operational and Financial Highlights

Third quarter GAAP net loss of $1.6 million compared to GAAP net loss of $6.0 million in the year ago period
Third quarter EBITDA improved to $1.5 million compared to ($3.2) million in the same period last year
Third quarter Adjusted EBITDA improved to $3.2 million compared to $203,000 in the same period last year
Reduced quarterly operating expenses by 16.1% to $46.9 million compared to $55.9 million in the same period last year

“We continue to execute on our growth and turnaround strategy and remain on plan for 2020, as this is our second consecutive quarter posting both revenue and adjusted EBITDA improvements, despite the challenges posed by COVID-19,” commented Andrew Benett, Executive Chairman and Chief Executive Officer. “We achieved strong new business wins across several key sectors. We also continue to align our cost structure to become more operationally metric-driven, meeting industry benchmarks while modernizing IT infrastructure and facilities.”

Mr. Benett added, “We believe there is tremendous untapped value in cross selling our existing and enhanced services to both current clients and new prospects. With new opportunities to integrate our enhanced social media and e-commerce capabilities, we improved our Customer Care offerings and won key mandates. The breadth and depth of Harte Hanks service offerings enables us to compete favorably in the multiple addressable markets we serve while delivering on our cost saving efforts. We believe we are well positioned to end the year with a strong pipeline and new customer momentum heading into 2021.”

Third Quarter 2020 Results

Third quarter revenues were $47.7 million, compared to $51.4 million during the same quarter last year with lower contributions from retail and financial services. Third quarter revenues were up sequentially $6.1 million compared to $41.6 million last quarter, led by growth in B2B and consumer brands.

Third quarter operating income was $785,000, compared to an operating loss of $4.5 million in the same quarter last year. The improvement was a result of the Company’s cost reduction efforts, which lowered operating expenses by $9 million, including a $4.1 million or 23.9% reduction in production and distribution expense.

Third quarter Adjusted Operating Income was $2.5 million, compared to a loss of $1.1 million in the prior year quarter. The improvement in Adjusted Operating Loss reflects substantial cost-cutting actions taken by management.

Loss attributable to common stockholders for the third quarter was $1.7 million, or $0.27 per basic and diluted share. In the prior year period, loss attributable to common stockholders was $6.1 million, or a loss of $0.97 per basic and diluted share.

Conference Call Information

The company will host a conference call and live webcast to discuss these results today at 4:30 p.m. ET. To access the live call, please dial (800) 263-0877 (toll free) or (646) 828-8143 and reference conference ID 6721741. The conference call will also be webcast live in the Investors Events section of the Harte Hanks website and can be accessed from the link here.

Following the conclusion of the live call, a telephonic replay will be available for 48 hours by dialing (844) 512-2921 or (412) 317-6671 and using the pin number 6721741. The replay will also be available for at least 90 days in the Investors Events section of the Harte Hanks website.

Cautionary Note Regarding Forward-Looking Statements:

Our press release and related earnings conference call contain “forward-looking statements” within the meaning of U.S. federal securities laws. All such statements are qualified by this cautionary note, provided pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements other than historical facts are forward-looking and may be identified by words such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “seeks,” “could,” “intends,” or words of similar meaning. These forward-looking statements are based on current information, expectations and estimates and involve risks, uncertainties, assumptions and other factors that are difficult to predict and that could cause actual results to vary materially from what is expressed in or indicated by the forward-looking statements. In that event, our business, financial condition, results of operations or liquidity could be materially adversely affected and investors in our securities could lose part or all of their investments. These risks, uncertainties, assumptions and other factors include: (a) local, national and international economic and business conditions, including (i) the outbreak of diseases, such as the COVID-19 coronavirus, which has curtailed travel to and from certain countries and geographic regions, disrupted business operations resulting from travel restrictions and reduced consumer spending, and uncertainty regarding the duration of the virus’ impact, (ii) market conditions that may adversely impact marketing expenditures and (iii) the impact of economic environments and competitive pressures on the financial condition, marketing expenditures and activities of our clients and prospects; (b) the demand for our products and services by clients and prospective clients, including (i) the willingness of existing clients to maintain or increase their spending on products and services that are or remain profitable for us, and (ii) our ability to predict changes in client needs and preferences; (c) economic and other business factors that impact the industry verticals we serve, including competition and consolidation of current and prospective clients, vendors and partners in these verticals; (d) our ability to manage and timely adjust our facilities, capacity, workforce and cost structure to effectively serve our clients; (e) our ability to improve our processes and to provide new products and services in a timely and cost-effective manner though development, license, partnership or acquisition; (f) our ability to protect our facilities against security breaches and other interruptions and to protect sensitive personal information of our clients and their customers; (g) our ability to respond to increasing concern, regulation and legal action over consumer privacy issues, including changing requirements for collection, processing and use of information; (h) the impact of privacy and other regulations, including restrictions on unsolicited marketing communications and other consumer protection laws; (i) fluctuations in fuel prices, paper prices, postal rates and postal delivery schedules; (j) the number of shares, if any, that we may repurchase in connection with our repurchase program; (k) unanticipated developments regarding litigation or other contingent liabilities; (l) our ability to complete anticipated divestitures and reorganizations, including cost-saving initiatives; (m) our ability to realize the expected tax refunds; and (n) other factors discussed from time to time in our filings with the Securities and Exchange Commission, including under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019 which was filed on March 19, 2020. The forward-looking statements in this press release and our related earnings conference call are made only as of the date hereof, and we undertake no obligation to update publicly any forward-looking statement, even if new information becomes available or other events occur in the future.

Supplemental Non-GAAP Financial Measures:

The Company reports its financial results in accordance with generally accepted accounting principles (“GAAP”). In this press release and our related earnings conference call, however, the Company may use certain non-GAAP measures of financial performance in order to provide investors with a better understanding of operating results and underlying trends to assess the Company’s performance and liquidity. We have presented herein a reconciliation of these measures to the most directly comparable GAAP financial measure.

The Company presents the non-GAAP financial measure “Adjusted Operating Loss” as a measure useful to both management and investors in their analysis of the Company’s Condensed Consolidated Statements of Operations (Unaudited) because it facilitates a period to period comparison of Operating Revenue and Operating Loss by excluding restructuring expense, impairment expense and stock-based compensation in 2020 and 2019. The most directly comparable measure for this non-GAAP financial measure is Operating Loss.

The Company also presents the non-GAAP financial measure “Adjusted EBITDA” as a supplemental measure of operating performance in order to provide an improved understanding of underlying performance trends. The Company defines “Adjusted EBITDA” as earnings before interest expense net , income tax expense (benefit), depreciation expense, restructuring expense, impairment expense, stock-based compensation expense, and other non-cash expenses. The most directly comparable measure for Adjusted EBITDA is Net Income (Loss). We believe Adjusted EBITDA is an important performance metric because it facilitates the analysis of our results, exclusive of certain non-cash items, including items which do not directly correlate to our business operations; however, we urge investors to review the reconciliation of non-GAAP Adjusted EBITDA to the comparable GAAP Net Income (Loss), which is included in this press release, and not to rely on any single financial measure to evaluate the Company’s financial performance.

The foregoing measures do not serve as a substitute and should not be construed as a substitute for GAAP performance, but provide supplemental information concerning our performance that our investors and we find useful. The Company evaluates its operating performance based on several measures, including these non-GAAP financial measures. The Company believes that the presentation of these non-GAAP financial measures in this press release and earnings conference call presentations are useful supplemental financial measures of operating performance for investors because they facilitate investors’ ability to evaluate the operational strength of the Company’s business. However, there are limitations to the use of these non-GAAP measures, including that they may not be calculated the same by other companies in our industry limiting their use as a tool to compare results. Any supplemental non-GAAP financial measures referred to herein are not calculated in accordance with GAAP and they should not be considered in isolation or as substitutes for the most comparable GAAP financial measures.

As used herein, “Harte Hanks” or “the Company” refers to Harte Hanks, Inc. and/or its applicable operating subsidiaries, as the context may require. Harte Hanks’ logo and name are trademarks of Harte Hanks.

About Harte Hanks:
Harte Hanks is an industry leader in data-driven, omnichannel marketing solutions and logistics. The fuel that powers this Company is customer data. We offer clients around the world the strategic guidance they need across the customer data landscape as well as the executional know-how in database build and management, data analytics, data-driven creativity, digital media, direct mail, customer contact, client fulfillment, and marketing and product logistics. Harte Hanks has approximately 2400 employees delivering solutions in North America, Asia-Pacific and Europe. For more information, visit Harte Hanks at www.hartehanks.com, call 800-456-9748, or email us at [email protected].

Investor Relations Contact:

Sheila Ennis

Abernathy MacGregor

415-745-3294
[email protected]

Harte Hanks, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
	Three Months Ended September 30,		Nine Months Ended September 30,
In thousands, except per share data	2020	2019	2020	2019
Operating revenues	$ 47,702	$ 51,414	$ 129,825	$ 165,250
Operating expenses
Labor	27,041	28,589	76,601	94,034
Production and distribution	13,176	17,314	36,940	58,130
Advertising, selling, general and administrative	4,540	5,623	15,582	20,225
Restructuring expense	1,419	3,080	8,005	10,867
Depreciation expense	741	1,283	2,905	4,022
Total operating expenses	46,917	55,889	140,033	187,278
Operating Income (loss)	785	(4,475)	(10,208)	(22,028)
Other expenses (income), net
Interest expense, net	274	330	882	938
Gain on contingent payment from 3Q	–	–	–	(5,000)
Other, net	2,185	1,081	4,511	4,512
Total other expenses (income), net	2,459	1,411	5,393	450
Loss before income taxes	(1,674)	(5,886)	(15,601)	(22,478)
Income tax (benefit) expense	(53)	102	(12,863)	840
Net loss	(1,621)	(5,988)	(2,738)	(23,318)
Less Preferred Stock dividends	125	125	372	371
Loss attributable to common stockholders	$ (1,746)	$ (6,113)	$ (3,110)	$ (23,689)


Loss per common share
Basic	$ (0.27)	$ (0.97)	$ (0.48)	$ (3.77)
Diluted	$ (0.27)	$ (0.97)	$ (0.48)	$ (3.77)

Weighted-average common shares outstanding
Basic	6,523	6,291	6,432	6,277
Diluted	6,523	6,291	6,432	6,277

Harte Hanks, Inc.
Reconciliations of Non-GAAP Financial Measures (Unaudited)
	Three Months Ended September 30,		Nine Months Ended September 30,
In thousands, except per share data	2020	2019	2020	2019
Net loss	$ (1,621)	$ (5,988)	$ (2,738)	$ (23,318)
Gain on sale	–	–	–	(5,000)
Income tax (benefit) expense	(53)	102	(12,863)	840
Interest expense, net	274	330	882	938
Other, net	2,185	1,081	4,511	4,512
Depreciation expense	741	1,283	2,905	4,022
EBITDA	$ 1,526	$ (3,192)	$ (7,303)	$ (18,006)

Restructuring expense	1,419	3,080	8,005	10,867
Stock-based compensation	271	315	590	739
Adjusted EBITDA	$ 3,216	$ 203	$ 1,292	$ (6,400)


Operating income (loss)	$ 785	$ (4,475)	$(10,208)	$ (22,028)
Restructuring expense	1,419	3,080	8,005	10,867
Stock-based compensation	271	315	590	739
Adjusted operating income (loss)	$ 2,475	$ (1,080)	$ (1,613)	$ (10,422)
Adjusted operating margin (a)	5.2%	-2.1%	-1.2%	-6.3%

(a) Adjusted Operating Margin equals Adjusted Operating Income (Loss) divided by Revenues

Harte Hanks, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
In thousands, except per share data	September 30, 2020	December 31, 2019

ASSETS
Current Assets
Cash and cash equivalents	$ 29,296	$ 28,104
Restricted cash	2,489	6,018
Accounts receivable (less allowance for doubtful accounts of $766 at September 30, 2020 and $666 at December 31, 2019)	46,006	38,972
Contract assets	400	805
Inventory	54	354
Prepaid expenses	2,848	3,300
Prepaid income tax and income tax receivable	9,062	78
Other current assets	1,490	1,670
Total current assets	91,645	79,301

Net property, plant and equipment	5,080	8,323
Right-of-use assets	14,408	18,817
Other assets	3,529	3,761
Total assets	$ 114,662	$ 110,202

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities
Accounts payable and accrued expenses	$ 17,629	$ 16,917
Accrued payroll and related expenses	5,079	4,215
Deferred revenue and customer advances	5,952	4,397
Customer postage and program deposits	4,971	9,767
Other current liabilities	2,921	2,619
Short-term debt	6,681	–
Short-term lease liabilities	6,803	7,616
Total current liabilities	50,036	45,531

Long-term debt	20,419	18,700
Pensions	68,300	70,000
Deferred tax liability, net	77	244
Long-term lease liabilities	10,827	13,078
Other long-term liabilities	4,240	2,609
Total liabilities	153,899	150,162

Preferred Stock	9,723	9,723

Stockholders’ deficit
Common stock	12,121	12,121
Additional paid-in capital	393,545	447,022
Retained earnings	795,079	797,817
Less treasury stock	(1,189,465)	(1,243,509)
Accumulated other comprehensive loss	(60,240)	(63,134)
Total stockholders’ deficit	(48,960)	(49,683)

Total liabilities, Preferred Stock and stockholders’ deficit	$ 114,662	$ 110,202

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SOURCE Harte Hanks

November 12, 2020 4:09 pm

Extra Space Storage Inc. Announces 4th Quarter 2020 Dividend

PR Newswire

SALT LAKE CITY, Nov. 12, 2020 /PRNewswire/ — Extra Space Storage Inc. (the “Company”) (NYSE: EXR) announced today that the Company’s board of directors has declared a quarterly dividend of $0.90 per share on the common stock of the Company for the fourth quarter 2020. The dividend is payable on December 31, 2020 to stockholders of record at the close of business on December 15, 2020.

About Extra Space Storage Inc.

Extra Space Storage Inc., headquartered in Salt Lake City, is a fully integrated, self-administered and self-managed real estate investment trust, and a member of the S&P 500. As of September 30, 2020, the Company owned and/or operated 1,906 self-storage properties, which comprise approximately 1.4 million units and approximately 147.5 million square feet of rentable storage space offering customers conveniently located and secure storage units across the country, including boat storage, RV storage and business storage. The Company is the second largest owner and/or operator of self-storage properties in the United States and is the largest self-storage management company in the United States.

For more information, please visit www.extraspace.com.

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SOURCE Extra Space Storage Inc.

November 12, 2020 4:09 pm

Cisco Reports First Quarter Earnings

PR Newswire

Q1 Results:

Revenue:
$11.9 billion

Decrease of (9)% year over year

Earnings per Share: GAAP: $0.51; Non-GAAP: $0.76

GAAP EPS decreased (25)% year over year
Non-GAAP EPS decreased (10)% year over year

Q2 Guidance:

Revenue: 0% to (2)% decline year over year
Earnings per Share: GAAP: $0.55 to $0.60; Non-GAAP: $0.74 to $0.76

SAN JOSE, Calif., Nov. 12, 2020 /PRNewswire/ — Cisco today reported first quarter results for the period ended October 24, 2020. Cisco reported first quarter revenue of $11.9 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.2 billion or $0.51 per share, and non-GAAP net income of $3.2 billion or $0.76 per share.

“Cisco is off to a solid start in fiscal 2021 and we are encouraged by the signs of improvement in our business as we continue to navigate the pandemic and other macro uncertainties,” said Chuck Robbins, chairman and CEO of Cisco. “Our focus is on winning with a differentiated innovative portfolio, long-term growth and being a trusted technology partner offering choice and flexibility to our customers. We see many great opportunities ahead as every company in every industry is accelerating its digital-first strategy.”

GAAP Results

	Q1 FY 2021			Q1 FY 2020			Vs. Q1 FY 2020
Revenue	$	11.9	billion	$	13.2	billion	(9)%
Net Income	$	2.2	billion	$	2.9	billion	(26)%
Diluted Earnings per Share (EPS)	$	0.51		$	0.68		(25)%


Non-GAAP Results

	Q1 FY 2021			Q1 FY 2020			Vs. Q1 FY 2020
Net Income	$	3.2	billion	$	3.6	billion	(11)%
EPS	$	0.76		$	0.84		(10)%

Reconciliations between net income, EPS, and other measures on a GAAP and non-GAAP basis are provided in the tables located in the section entitled “Reconciliations of GAAP to non-GAAP Measures.”

“Our Q1 results reflect good execution with strong margins in a challenging environment,” said Kelly Kramer, CFO of Cisco. “We continued to transform our business through more software offerings and subscriptions, driving 10% year over year growth in remaining performance obligations. We delivered strong growth in operating cash flow and returned $2.3 billion to shareholders.”

Financial Summary

All comparative percentages are on a year-over-year basis unless otherwise noted.

Q1 FY 2021 Highlights

Revenue —
Total revenue was $11.9 billion, down 9%, with product revenue down 13% and service revenue up 2%. Revenue by geographic segment was: Americas down 10%, EMEA down 10%, and APJC down 7%. Product revenue was led by growth in Security, up 6%. Infrastructure Platforms was down 16% and Applications was down 8%.

Gross Margin —
On a GAAP basis, total gross margin, product gross margin, and service gross margin were 63.6%, 62.7%, and 65.8%, respectively, as compared with 64.3% for each in the first quarter of fiscal 2020.

On a non-GAAP basis, total gross margin, product gross margin, and service gross margin were 65.8%, 65.3%, and 67.1%, respectively, as compared with 65.9%, 66.1%, and 65.4%, respectively, in the first quarter of fiscal 2020.

Total gross margins by geographic segment were: 67.3% for the Americas, 63.9% for EMEA and 63.0% for APJC.

Operating Expenses —
On a GAAP basis, operating expenses were $5.0 billion, up 3%, and were 42.0% of revenue. Non-GAAP operating expenses were $4.0 billion, down 7%, and were 33.1% of revenue.

Operating Income —
GAAP operating income was $2.6 billion, down 28%, with GAAP operating margin of 21.5%. Non-GAAP operating income was $3.9 billion, down 12%, with non-GAAP operating margin at 32.7%.

Provision for Income Taxes —
The GAAP tax provision rate was 18.9%. The non-GAAP tax provision rate was 19.0%.

Net Income and EPS —
On a GAAP basis, net income was $2.2 billion, a decrease of 26%, and EPS was $0.51, a decrease of 25%. On a non-GAAP basis, net income was $3.2 billion, a decrease of 11%, and EPS was $0.76, a decrease of 10%.

Cash Flow from Operating Activities —

$4.1 billion for the first quarter of fiscal 2021, an increase of 14% compared with $3.6 billion for the first quarter of fiscal 2020.

Balance Sheet and Other Financial Highlights

Cash and Cash Equivalents and Investments —

$30.0 billion at the end of the first quarter of fiscal 2021, compared with $29.4 billion at the end of fiscal 2020.

Deferred Revenue —

$20.5 billion, up 10% in total, with deferred product revenue up 15%. Deferred service revenue was up 7%.

Remaining Performance Obligations

—

$27.5 billion at the end of the first quarter of fiscal 2021, up 10%.

Capital Allocation —
In the first quarter of fiscal 2021, we returned $2.3 billion to shareholders through share buybacks and dividends. We declared and paid a cash dividend of $0.36 per common share, or $1.5 billion, and repurchased approximately 20 million shares of common stock under our stock repurchase program at an average price of $40.44 per share for an aggregate purchase price of $800 million. The remaining authorized amount for stock repurchases under the program is $10.0 billion with no termination date.

Guidance for Q2 FY 2021

Cisco expects to achieve the following results for the second quarter of fiscal 2021:

Q2 FY 2021
Revenue		0% – (2)% decline Y/Y
Non-GAAP gross margin rate		64% – 65%
Non-GAAP operating margin rate		32% – 33%
Non-GAAP tax provision rate		19%
Non-GAAP EPS		$0.74 – $0.76

Cisco estimates that GAAP EPS will be $0.55 to $0.60 in the second quarter of fiscal 2021.

A reconciliation between the Guidance for Q2 FY 2021 on a GAAP and non-GAAP basis is provided in the table entitled “GAAP to non-GAAP Guidance for Q2 FY 2021” located in the section entitled “Reconciliations of GAAP to non-GAAP Measures.”

Editor’s Notes:

Q1 fiscal year 2021 conference call to discuss Cisco’s results along with its guidance will be held on Thursday, November 12, 2020 at 1:30 p.m. Pacific Time. Conference call number is 1-888-848-6507 (United States) or 1-212-519-0847 (international).
Conference call replay will be available from 4:00 p.m. Pacific Time, November 12, 2020 to 4:00 p.m. Pacific Time, November 19, 2020 at 1-800-879-5193 (United States) or 1-203-369-3562 (international). The replay will also be available via webcast on the Cisco Investor Relations website at https://investor.cisco.com.
Additional information regarding Cisco’s financials, as well as a webcast of the conference call with visuals designed to guide participants through the call, will be available at 1:30 p.m. Pacific Time, November 12, 2020. Text of the conference call’s prepared remarks will be available within 24 hours of completion of the call. The webcast will include both the prepared remarks and the question-and-answer session. This information, along with the GAAP to non-GAAP reconciliation information, will be available on the Cisco Investor Relations website at https://investor.cisco.com.

CISCO SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per-share amounts)
(Unaudited)

	Three Months Ended
	October 24, 2020		October 26, 2019
REVENUE:
Product	$	8,587	$	9,878
Service	3,342		3,281
Total revenue	11,929		13,159
COST OF SALES:
Product	3,206		3,524
Service	1,142		1,171
Total cost of sales	4,348		4,695
GROSS MARGIN	7,581		8,464
OPERATING EXPENSES:
Research and development	1,612		1,666
Sales and marketing	2,217		2,480
General and administrative	544		519
Amortization of purchased intangible assets	36		36
Restructuring and other charges	602		184
Total operating expenses	5,011		4,885
OPERATING INCOME	2,570		3,579
Interest income	174		273
Interest expense	(112)		(178)
Other income (loss), net	49		12
Interest and other income (loss), net	111		107
INCOME BEFORE PROVISION FOR INCOME TAXES	2,681		3,686
Provision for income taxes	507		760
NET INCOME	$	2,174	$	2,926

Net income per share:
Basic	$	0.51	$	0.69
Diluted	$	0.51	$	0.68
Shares used in per-share calculation:
Basic	4,230		4,246
Diluted	4,244		4,273

CISCO SYSTEMS, INC.
REVENUE BY SEGMENT
(In millions, except percentages)

	Three Months Ended
	October 24, 2020
	Amount		Y/Y %
Revenue:
Americas	$	7,198	(10)%
EMEA	2,964		(10)%
APJC	1,767		(7)%
Total	$	11,929	(9)%

Amounts may not sum and percentages may not recalculate due to rounding.

CISCO SYSTEMS, INC.
GROSS MARGIN PERCENTAGE BY SEGMENT
(In percentages)

		Three Months Ended
		October 24, 2020
Gross Margin Percentage:
Americas		67.3%
EMEA		63.9%
APJC		63.0%

CISCO SYSTEMS, INC.
REVENUE FOR GROUPS OF SIMILAR PRODUCTS AND SERVICES
(In millions, except percentages)

	Three Months Ended
	October 24, 2020
	Amount		Y/Y %
Revenue:
Infrastructure Platforms	$	6,341	(16)%
Applications	1,380		(8)%
Security	861		6%
Other Products	5		(56)%
Total Product	8,587		(13)%
Services	3,342		2%
Total	$	11,929	(9)%

Amounts may not sum and percentages may not recalculate due to rounding.

CISCO SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)
(Unaudited)

	October 24, 2020		July 25, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	10,822	$	11,809
Investments	19,190		17,610
Accounts receivable, net of allowance for doubtful accounts of $125 at October 24, 2020 and $143 at July 25, 2020	3,980		5,472
Inventories	1,303		1,282
Financing receivables, net	5,105		5,051
Other current assets	2,589		2,349
Total current assets	42,989		43,573
Property and equipment, net	2,412		2,453
Financing receivables, net	5,516		5,714
Goodwill	34,535		33,806
Purchased intangible assets, net	1,581		1,576
Deferred tax assets	4,138		3,990
Other assets	3,832		3,741
TOTAL ASSETS	$	95,003	$	94,853
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt	$	5,002	$	3,005
Accounts payable	2,294		2,218
Income taxes payable	810		839
Accrued compensation	2,978		3,122
Deferred revenue	11,271		11,406
Other current liabilities	4,636		4,741
Total current liabilities	26,991		25,331
Long-term debt	9,564		11,578
Income taxes payable	8,786		8,837
Deferred revenue	9,202		9,040
Other long-term liabilities	2,303		2,147
Total liabilities	56,846		56,933
Total equity	38,157		37,920
TOTAL LIABILITIES AND EQUITY	$	95,003	$	94,853

CISCO SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)

	Three Months Ended
	October 24, 2020		October 26, 2019
Cash flows from operating activities:
Net income	$	2,174	$	2,926
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, and other	451		461
Share-based compensation expense	438		395
Provision (benefit) for receivables	13		50
Deferred income taxes	(120)		81
(Gains) losses on divestitures, investments and other, net	(59)		(8)
Change in operating assets and liabilities, net of effects of acquisitions and divestitures:
Accounts receivable	1,526		515
Inventories	(21)		34
Financing receivables	167		146
Other assets	(259)		59
Accounts payable	73		(45)
Income taxes, net	(84)		(330)
Accrued compensation	(165)		(473)
Deferred revenue	(45)		158
Other liabilities	7		(382)
Net cash provided by operating activities	4,096		3,587
Cash flows from investing activities:
Purchases of investments	(3,756)		(2,028)
Proceeds from sales of investments	657		2,342
Proceeds from maturities of investments	1,425		1,966
Acquisitions and divestitures	(830)		(163)
Purchases of investments in privately held companies	(68)		(54)
Return of investments in privately held companies	29		57
Acquisition of property and equipment	(171)		(202)
Proceeds from sales of property and equipment	4		4
Net cash (used in) provided by investing activities	(2,710)		1,922
Cash flows from financing activities:
Issuances of common stock	1		2
Repurchases of common stock – repurchase program	(800)		(784)
Shares repurchased for tax withholdings on vesting of restricted stock units	(89)		(194)
Short-term borrowings, original maturities of 90 days or less, net	—		(3,470)
Repayments of debt	—		(2,720)
Dividends paid	(1,520)		(1,486)
Other	35		(16)
Net cash used in financing activities	(2,373)		(8,668)
Net decrease in cash, cash equivalents, and restricted cash	(987)		(3,159)
Cash, cash equivalents, and restricted cash, beginning of period	11,812		11,772
Cash, cash equivalents, and restricted cash, end of period	$	10,825	$	8,613
Supplemental cash flow information:
Cash paid for interest	$	160	$	204
Cash paid for income taxes, net	$	710	$	1,009

CISCO SYSTEMS, INC.
DEFERRED REVENUE
(In millions)

	October 24, 2020		July 25, 2020		October 26, 2019
Deferred revenue:
Product	$	8,139	$	7,895	$	7,105
Service	12,334		12,551		11,497
Total	$	20,473	$	20,446	$	18,602
Reported as:
Current	$	11,271	$	11,406	$	10,646
Noncurrent	9,202		9,040		7,956
Total	$	20,473	$	20,446	$	18,602

CISCO SYSTEMS, INC.
REMAINING PERFORMANCE OBLIGATIONS
(In millions, except percentages)

	October 24, 2020				July 25, 2020				October 26, 2019
	Amount		Y/Y%		Amount		Y/Y%		Amount		Y/Y%
Product	$	11,340	15	%	$	11,261	17	%	$	9,878	28	%
Service	16,129		8	%	17,093		9	%	14,991		3	%
Total	$	27,469	10	%	$	28,354	12	%	$	24,869	11	%

CISCO SYSTEMS, INC.
DIVIDENDS PAID AND REPURCHASES OF COMMON STOCK
(In millions, except per-share amounts)

	DIVIDENDS				STOCK REPURCHASE PROGRAM					TOTAL
Quarter Ended	Per Share		Amount		Shares	Weighted- Average Price per Share		Amount		Amount
Fiscal 2021
October 24, 2020	$	0.36	$	1,520	20	$	40.44	$	800	$	2,320
Fiscal 2020
July 25, 2020	$	0.36	$	1,525	—	$	—	$	—	$	1,525
April 25, 2020	$	0.36	$	1,519	25	$	39.71	$	981	$	2,500
January 25, 2020	$	0.35	$	1,486	18	$	46.71	$	870	$	2,356
October 26, 2019	$	0.35	$	1,486	16	$	48.91	$	768	$	2,254

CISCO SYSTEMS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

GAAP TO NON-GAAP NET INCOME
(In millions)

	Three Months Ended
	October 24, 2020		October 26, 2019
GAAP net income	$	2,174	$	2,926
Adjustments to cost of sales:
Share-based compensation expense	65		57
Amortization of acquisition-related intangible assets	163		150
Acquisition-related/divestiture costs	1		1
Legal and indemnification settlements/charges	43		4
Total adjustments to GAAP cost of sales	272		212
Adjustments to operating expenses:
Share-based compensation expense	362		333
Amortization of acquisition-related intangible assets	36		36
Acquisition-related/divestiture costs	59		72
Significant asset impairments and restructurings	602		184
Total adjustments to GAAP operating expenses	1,059		625
Adjustments to GAAP interest and other income (loss), net:
(Gains) and losses on equity investments	(48)		(13)
Total adjustments to GAAP income before provision for income taxes	1,283		824
Income tax effect of non-GAAP adjustments	(246)		(209)
Significant tax matters	—		67
Total adjustments to GAAP provision for income taxes	(246)		(142)
Non-GAAP net income	$	3,211	$	3,608

CISCO SYSTEMS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

GAAP TO NON-GAAP EPS

	Three Months Ended
	October 24, 2020		October 26, 2019
GAAP EPS	$	0.51	$	0.68
Adjustments to GAAP:
Share-based compensation expense	0.10		0.09
Amortization of acquisition-related intangible assets	0.05		0.04
Acquisition-related/divestiture costs	0.01		0.02
Legal and indemnification settlements/charges	0.01		—
Significant asset impairments and restructurings	0.14		0.04
(Gains) and losses on equity investments	(0.01)		—
Income tax effect of non-GAAP adjustments	(0.06)		(0.05)
Significant tax matters	—		0.02
Non-GAAP EPS	$	0.76	$	0.84

Amounts may not sum due to rounding.

CISCO SYSTEMS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

GROSS MARGINS, OPERATING EXPENSES, OPERATING MARGINS, INTEREST AND OTHER INCOME (LOSS), NET, AND NET INCOME
(In millions, except percentages)

	Three Months Ended
	October 24, 2020
	Product Gross Margin			Service Gross Margin			Total Gross Margin			Operating Expenses			Y/Y	Operating Income			Y/Y	Interest and other income (loss), net			Net Income			Y/Y
GAAP amount	$	5,381		$	2,200		$	7,581		$	5,011		3%	$	2,570		(28)%	$	111		$	2,174		(26)%
% of revenue	62.7		%	65.8		%	63.6		%	42.0		%		21.5		%		0.9		%	18.2		%
Adjustments to GAAP amounts:
Share-based compensation expense	24			41			65			362				427				—			427
Amortization of acquisition-related intangible assets	163			—			163			36				199				—			199
Acquisition/divestiture-related costs	—			1			1			59				60				—			60
Legal and indemnification settlements/charges	43			—			43			—				43				—			43
Significant asset impairments and restructurings	—			—			—			602				602				—			602
(Gains) and losses on equity investments	—			—			—			—				—				(48)			(48)
Income tax effect/significant tax matters	—			—			—			—				—				—			(246)
Non-GAAP amount	$	5,611		$	2,242		$	7,853		$	3,952		(7)%	$	3,901		(12)%	$	63		$	3,211		(11)%
% of revenue	65.3		%	67.1		%	65.8		%	33.1		%		32.7		%		0.5		%	26.9		%

	Three Months Ended
	October 26, 2019
	Product Gross Margin			Service Gross Margin			Total Gross Margin			Operating Expenses			Operating Income			Interest and other income (loss), net			Net Income
GAAP amount	$	6,354		$	2,110		$	8,464		$	4,885		$	3,579		$	107		$	2,926
% of revenue	64.3		%	64.3		%	64.3		%	37.1		%	27.2		%	0.8		%	22.2		%
Adjustments to GAAP amounts:
Share-based compensation expense	23			34			57			333			390			—			390
Amortization of acquisition-related intangible assets	150			—			150			36			186			—			186
Legal and indemnification settlements/charges	4			—			4			—			4			—			4
Acquisition/divestiture-related costs	—			1			1			72			73			—			73
Significant asset impairments and restructurings	—			—			—			184			184			—			184
(Gains) and losses on equity investments	—			—			—			—			—			(13)			(13)
Income tax effect/significant tax matters	—			—			—			—			—			—			(142)
Non-GAAP amount	$	6,531		$	2,145		$	8,676		$	4,260		$	4,416		$	94		$	3,608
% of revenue	66.1		%	65.4		%	65.9		%	32.4		%	33.6		%	0.7		%	27.4		%

Amounts may not sum and percentages may not recalculate due to rounding.

CISCO SYSTEMS, INC.
RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

EFFECTIVE TAX RATE
(In percentages)

	Three Months Ended
	October 24, 2020		October 26, 2019
GAAP effective tax rate	18.9	%	20.6	%
Total adjustments to GAAP provision for income taxes	0.1	%	(0.6)	%
Non-GAAP effective tax rate	19.0	%	20.0	%

GAAP TO NON-GAAP GUIDANCE FOR Q2 FY 2021

Q2 FY 2021	Gross Margin Rate	Operating Margin Rate	Tax Provision Rate	Earnings per Share ⁽²⁾
GAAP	62% – 63%	24.5%- 25.5%	19%	$0.55 – $0.60
Estimated adjustments for:
Share-based compensation expense	0.5%	3.5%	—	$0.08 – $0.09
Amortization of acquisition-related intangible assets and acquisition/divestiture-related costs	1.5%	2.0%	—	$0.04 – $0.05
Significant asset impairments and restructurings ⁽¹⁾	—	2.0%	—	$0.04 – $0.05
Income tax effect of non-GAAP adjustments			—
Non-GAAP	64% – 65%	32% – 33%	19%	$0.74 – $0.76

⁽¹⁾ In the first quarter of fiscal 2021, we initiated a restructuring plan, which includes a voluntary early retirement program, in order to realign the organization and enable further investment in key priority areas with total estimated pretax charges of approximately $900 million consisting of severance and other one-time termination benefits, and other costs. We recognized $602 million of these charges during the first quarter of fiscal 2021. We expect to recognize approximately $200 million of these charges in the second quarter of fiscal 2021 with the remaining amount to be recognized during the rest of the fiscal year.

⁽²⁾ Estimated adjustments to GAAP earnings per share are shown after income tax effects.

Except as noted above, this guidance does not include the effects of any future acquisitions/divestitures, asset impairments, restructurings and significant tax matters or other events, which may or may not be significant unless specifically stated.

Forward Looking Statements, Non-GAAP Information and Additional Information

This release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events (such as improvement in our business as we continue to navigate the pandemic and other macro uncertainties, our ability to execute on our strategy to focus on winning with a differentiated innovative portfolio, long-term growth and being a trusted technology partner offering choice and flexibility to our customers, our future opportunities as every company in every industry is accelerating its digital-first strategy, our ability to continue to transform our business through more software offerings and subscriptions, and our ability to continue to deliver strong growth in operating cash flow and return value to our shareholders) and the future financial performance of Cisco (including the guidance for Q2 FY 2021) that involve risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results due to a variety of factors, including: the impact of the COVID-19 pandemic; business and economic conditions and growth trends in the networking industry, our customer markets and various geographic regions; global economic conditions and uncertainties in the geopolitical environment; overall information technology spending; the growth and evolution of the Internet and levels of capital spending on Internet-based systems; variations in customer demand for products and services, including sales to the service provider market and other customer markets; the return on our investments in certain priorities, key growth areas, and in certain geographical locations, as well as maintaining leadership in routing, switching and services; the timing of orders and manufacturing and customer lead times; changes in customer order patterns or customer mix; insufficient, excess or obsolete inventory; variability of component costs; variations in sales channels, product costs or mix of products sold; our ability to successfully acquire businesses and technologies and to successfully integrate and operate these acquired businesses and technologies; our ability to achieve expected benefits of our partnerships; increased competition in our product and service markets, including the data center market; dependence on the introduction and market acceptance of new product offerings and standards; rapid technological and market change; manufacturing and sourcing risks; product defects and returns; litigation involving patents, intellectual property, antitrust, shareholder and other matters, and governmental investigations; our ability to achieve the benefits of the announced restructuring and possible changes in the size and timing of the related charges; cyber-attacks, data breaches or malware; vulnerabilities and critical security defects; terrorism; natural catastrophic events; any other pandemic or epidemic; our ability to achieve the benefits anticipated from our investments in sales, engineering, service, marketing and manufacturing activities; our ability to recruit and retain key personnel; our ability to manage financial risk, and to manage expenses during economic downturns; risks related to the global nature of our operations, including our operations in emerging markets; currency fluctuations and other international factors; changes in provision for income taxes, including changes in tax laws and regulations or adverse outcomes resulting from examinations of our income tax returns; potential volatility in operating results; and other factors listed in Cisco’s most recent report on Form 10-K filed on September 3, 2020. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes thereto included in Cisco’s most recent report on Form 10-K as it may be amended from time to time. Cisco’s results of operations for the three months ended October 24, 2020 are not necessarily indicative of Cisco’s operating results for any future periods. Any projections in this release are based on limited information currently available to Cisco, which is subject to change. Although any such projections and the factors influencing them will likely change, Cisco will not necessarily update the information, since Cisco will only provide guidance at certain points during the year. Such information speaks only as of the date of this release.

This release includes non-GAAP net income, non-GAAP gross margins, non-GAAP operating expenses, non-GAAP operating income and margin, non-GAAP effective tax rates, non-GAAP interest and other income (loss), net, and non-GAAP net income per share data for the periods presented. It also includes future estimated ranges for gross margin, operating margin, tax provision rate and EPS on a non-GAAP basis.

These non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Cisco believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Cisco’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Cisco’s results of operations in conjunction with the corresponding GAAP measures.

Cisco believes that the presentation of non-GAAP measures when shown in conjunction with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations.

For its internal budgeting process, Cisco’s management uses financial statements that do not include, when applicable, share-based compensation expense, amortization of acquisition-related intangible assets, acquisition-related/divestiture costs, significant asset impairments and restructurings, significant litigation settlements and other contingencies, gains and losses on equity investments, the income tax effects of the foregoing and significant tax matters. Cisco’s management also uses the foregoing non-GAAP measures, in addition to the corresponding GAAP measures, in reviewing the financial results of Cisco. In prior periods, Cisco has excluded other items that it no longer excludes for purposes of its non-GAAP financial measures. From time to time in the future there may be other items that Cisco may exclude for purposes of its internal budgeting process and in reviewing its financial results. For additional information on the items excluded by Cisco from one or more of its non-GAAP financial measures, refer to the Form 8-K regarding this release furnished today to the Securities and Exchange Commission.

About Cisco

Cisco (Nasdaq: CSCO) is the worldwide leader in technology that powers the Internet. Cisco inspires new possibilities by reimagining your applications, securing your data, transforming your infrastructure, and empowering your teams for a global and inclusive future. Discover more at newsroom.cisco.com and follow us on Twitter at @Cisco.

Copyright © 2020 Cisco and/or its affiliates. All rights reserved. Cisco and the Cisco logo are trademarks or registered trademarks of Cisco and/or its affiliates in the U.S. and other countries. To view a list of Cisco trademarks, go to: www.cisco.com/go/trademarks. Third-party trademarks mentioned in this document are the property of their respective owners. The use of the word partner does not imply a partnership relationship between Cisco and any other company. This document is Cisco Public Information.

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Press Contact:		Investor Relations Contact:
Robyn Blum		Marilyn Mora
Cisco		Cisco
1 (408) 930-8548		1 (408) 527-7452
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SOURCE Cisco

November 12, 2020 4:09 pm

Akero Therapeutics Reports Third Quarter 2020 Financial Results

PR Newswire

SOUTH SAN FRANCISCO, Calif., Nov. 12, 2020 /PRNewswire/ — Akero Therapeutics, Inc. (Nasdaq: AKRO), a cardio-metabolic non-alcoholic steatohepatitis (NASH) company developing pioneering medicines designed to restore metabolic balance and improve the overall health of NASH patients, today reported third quarter financial results for the period ending September 30, 2020.

“On the heels of reporting strongly positive histological data from our FGF21 analog, efruxifermin (EFX), we executed a number of important objectives in the third quarter that position us for continued success,” said Andrew Cheng, M.D., Ph.D., president and chief executive officer of Akero. “In addition to raising more than $216 million to enable continued development of EFX, we received feedback from the FDA that enables us to continue to pursue EFX development with our proposed adaptive Phase 2b/3 clinical trial design. EFX also received PRIME designation from EMA for development as a NASH therapy. Each of these milestones represents a large step forward in the development of EFX, which we believe has the potential to be a foundational monotherapy for NASH.”

Third Quarter Business Highlights

On July 10^th, the Company closed an upsized underwritten public offering of 6,012,390 shares of common stock at a price of $36.00 per share. Gross proceeds from the offering, before deducting underwriting discounts, commissions and offering expenses, were approximately $216.4 million.
On July 21^st, the Company announced publication of data in the journal Cell Reports Medicine from the Phase 1b clinical trial of EFX, which showed its potential to modulate biomarkers associated with metabolic diseases, including NASH.
On Sept. 24^th, the Company announced that written guidance from the U.S. Food and Drug Administration (FDA) enables implementation of an innovative combined Phase 2b/3 study design for a pivotal EFX clinical trial in NASH patients with F2-F3 fibrosis. Under the planned adaptive trial design, the Company will evaluate the 28 and 50mg EFX doses in a 24-week Phase 2b portion of the trial to inform selection of one of these doses for evaluation in the Phase 3 portion of the study.
On Sept. 30^th, the Company announced enrollment had been completed for a cohort of the BALANCED study (Cohort C), which is investigating the effects of 16 weeks of EFX treatment on patients with NASH who have compensated cirrhosis (F4), Child-Pugh Class A. The Company expects results from this study cohort to inform long-term development plans for EFX to treat cirrhotic NASH patients, who are at greatest risk of progressing to end-stage liver disease. The Company expects to report the results of the F4 expansion cohort in the first half of 2021.
On Oct. 16^th, the Company announced that the European Medicines Agency (EMA) granted Priority Medicines (PRIME) designation to EFX for treatment of NASH. The designation was based on the positive efficacy data reported from the Company’s Phase 2a BALANCED study. The PRIME program is designed to enhance regulatory support in the EU for the development of promising investigational medicines that target unmet medical need.

Manufacturing Update

Manufacture of GMP drug substance (API) at commercial scale was completed in April 2020. GMP drug product for the Company’s anticipated Phase 2b clinical trial was manufactured from this API in September 2020.
A new lyophilized formulation is being developed for commercial drug product. This formulation will be used for the Phase 3 portion of the adaptive clinical trial design. Scale-up of manufacturing for this new drug product formulation began during the third quarter of 2020 and is expected to be completed in 2022.

Regulatory Update

Submission of multiple Investigational New Drug (IND) amendments are ongoing to support the Phase 2b portion of the adaptive Ph2b/3 study design. The Company remains on track to initiate Phase 2b in the first half of 2021.

Financial Highlights

Akero’s cash, cash equivalents and short-term marketable securities at September 30, 2020 were $291.9 million, which includes the net proceeds from the July 10^th equity offering.
Research and development expenses for the three-month and nine-month periods ended September 30, 2020 were $17.4 million and $39.2 million, respectively, compared to $13.9 million and $23.9 million for the comparable periods in 2019. These increases are attributable to higher costs related to Akero’s EFX program, including third-party contract manufacturing and contract research organization costs associated with the BALANCED study and internal personnel costs, including non-cash stock-based compensation.
General and administrative expenses for the three-month and nine-month periods ended September 30, 2020 were $4.2 million and $11.2 million, respectively, compared to $2.4 million and $5.5 million for the comparable periods in 2019. These increases are attributable to higher internal personnel costs, including non-cash stock-based compensation and professional services and other costs associated with operating as a public company.
Total operating expenses for the three-month and nine-month periods ended September 30, 2020, were $21.5 million and $50.4 million, respectively, compared to $16.3 million and $29.4 million for the comparable periods in 2019.

About NASH

NASH (non-alcoholic steatohepatitis) is a serious form of NAFLD (non-alcoholic fatty liver disease) and is estimated to affect 17 million Americans. NASH is closely linked to the obesity and diabetes epidemics seen around the world. NASH is characterized by an excessive accumulation of fat in the liver that causes stress and injury to liver cells, leading to inflammation and fibrosis, which can progress to cirrhosis, liver failure, cancer and eventually death. As a result, NASH has become a leading cause of liver transplants in the US and Europe.

About Efruxifermin

Efruxifermin (EFX), formerly AKR-001, is Akero’s lead product candidate for NASH. EFX has been shown to increase insulin sensitivity, improve lipoproteins, reduce liver fat and inflammation, and reverse fibrosis. The breadth of desirable metabolic effects offers potential to address the complex, multi-organ/tissue pathogenesis of NASH, including risk factors linked to cardiovascular disease – the leading cause of death in NASH patients. Engineered to mimic the biological activity profile of native human FGF21, EFX offers convenient once-weekly dosing.

About Akero Therapeutics

Akero is a cardio-metabolic NASH company dedicated to reversing the escalating NASH epidemic by developing pioneering medicines designed to restore metabolic balance and improve overall health of NASH patients. The Company’s lead product candidate, efruxifermin, has been evaluated in a 16-week Phase 2a clinical trial, the BALANCED study. Akero Therapeutics is headquartered in South San Francisco, CA. For more information, please visit www.akerotx.com.

Forward-Looking Statements

Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, statements regarding the Company’s business plans and objectives, including future plans or expectations for EFX, upcoming milestones, and therapeutic effects of EFX, as well as the dosing, safety and tolerability of EFX; the potential benefits resulting from the PRIME designation of EFX; Akero’s Phase 2a BALANCED study and Phase 2b/3 study including results and expected timing to complete Cohort C; expectations regarding the design, implementation, timing, and success of its current and planned clinical trials for EFX; expectations regarding successful scale-up of drug substance manufacturing and release of new drug product for use in clinical trials, including new product formulations; expectations regarding the Company’s use of capital, expenses and other future financial results; statements regarding the timing of Company’s efforts regarding the IND amendments; the Company’s planned efforts to prepare for commercialization of EFX, if approved and the potential impact of COVID-19 on strategy, future operations, enrollment and clinical trials. Any forward-looking statements in this press release are based on management’s current expectations of future events and are subject to a number of risks and uncertainties that could cause actual results to differ materially and adversely from those set forth in or implied by such forward-looking statements. Risks that contribute to the uncertain nature of the forward-looking statements include: risks related to the impact of COVID-19 on the Company’s ongoing and future operations, including potential negative impacts on Akero’s employees, third-parties, manufacturers, supply chain and production as well as on global economies and financial markets; the success, cost, and timing of the Company’s product candidate development activities and planned clinical trials; the Company’s ability to execute on its strategy; positive results from a clinical study may not necessarily be predictive of the results of future or ongoing clinical studies; regulatory developments in the United States and foreign countries; the Company’s ability to fund operations; as well as those risks and uncertainties set forth more fully under the caption “Risk Factors” in Akero’s Annual Report on Form 10-K for the year ended December 31, 2019 and most recently filed Quarterly Report on 10-Q, as filed with the Securities and Exchange Commission (SEC) as well as discussions of potential risks, uncertainties and other important factors in Akero’s other filings and reports with the SEC. All forward-looking statements contained in this press release speak only as of the date on which they were made. Akero undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.

Akero Therapeutics, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)

	September 30, 2020		December 31, 2019
Assets
Cash and cash equivalents and short-term marketable securities	$	291,870	$	136,400
Other current assets		6,163		1,649
Non-current assets		2,003		69
Total assets	$	300,036	$	138,118

Liabilities and Stockholders’ Equity
Current liabilities	$	12,014	$	9,369
Non-current liabilities		1,564		23
Stockholders’ equity		286,458		128,726
Total liabilities and stockholders’ equity	$	300,036	$	138,118

Akero Therapeutics, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(In thousands, except share and per share amounts)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Operating expenses:
Research and development	$	17,379	$	13,885	$	39,207	$	23,908
General and administrative		4,159		2,424		11,164		5,522
Total operating expenses		21,538		16,309		50,371		29,430
Loss from operations		(21,538)		(16,309)		(50,371)		(29,430)
Other income		135		755		875		1,286
Net loss	$	(21,403)	$	(15,554)	$	(49,496)	$	(28,144)
Comprehensive loss	$	(21,477)	$	(15,554)	$	(49,474)	$	(28,144)
Net loss per common share, basic and diluted	$	(0.63)	$	(0.56)	$	(1.63)	$	(2.66)
Weighted-average number of shares used in computing net loss per common share, basic and diluted		34,002,769		28,024,779		30,381,671		10,589,119

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SOURCE Akero Therapeutics, Inc.

November 12, 2020 4:09 pm

WideOpenWest, Inc. to Participate in Upcoming Investor Conferences

PR Newswire

ENGLEWOOD, Colo., Nov. 12, 2020 /PRNewswire/ — WOW! Internet, Cable & Phone (NYSE: WOW), a leading broadband provider in the United States, announced today that Teresa Elder, CEO, and John Rego, CFO, will be participating in the following upcoming virtual investor conferences:

Tuesday, November 17, 2020 at 9:20 AM EST: RBC Global Technology, Internet, Media and Telecom Virtual Conference

Thursday, November 19, 2020 at 10:00 AM EST: Stephens Annual Investment Conference 2020

A live webcast of each presentation will be available on the company’s investor relations website at ir.wowway.com.

About WOW! Internet, Cable & Phone
WOW! is one of the nation’s leading broadband providers, with an efficient, high-performing network that passes three million residential, business and wholesale consumers. WOW! provides services in 19 markets, primarily in the Midwest and Southeast, including Illinois, Michigan, Indiana, Ohio, Maryland, Alabama, Tennessee, South Carolina, Florida and Georgia. With an expansive portfolio of advanced services, including high-speed Internet services, cable TV, phone, business data, voice, and cloud services, the company is dedicated to providing outstanding service at affordable prices. WOW! also serves as a leader in exceptional human resources practices, having been recognized by the National Association for Business Resources’ for six years as a Best & Brightest Company to Work For, winning the award for the last two consecutive years. Visit wowway.com for more information.

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SOURCE WideOpenWest, Inc.

November 12, 2020 4:09 pm

Electric Vehicle Company Canoo To Present At The Barclays Global Automotive Conference

PR Newswire

LOS ANGELES, Nov. 12, 2020 /PRNewswire/ — Canoo Holdings Ltd. (“Canoo”), a company developing breakthrough electric vehicles (EV) with a proprietary and highly versatile skateboard platform for personal and business use, announced today it will present at the Barclays Global Automotive Conference. Members of management will present Thursday, November 19, at 4:05 p.m. ET. Access to the presentation will be available at the link here and will be hosted online for 1 year after the completion of the event.

Canoo has previously announced a merger agreement with Hennessy Capital Acquisition Corp. IV (“HCAC”) (Nasdaq: HCAC), a special purpose acquisition company (SPAC), that would result in Canoo becoming a publicly listed company.

About Canoo

Canoo is a Los Angeles-based company that has developed breakthrough electric vehicles, reinventing the automotive landscape with bold innovations in design, pioneering technologies, and a unique business model that defies traditional ownership to put customers first. Distinguished by its experienced team – numbering over 300 employees from leading technology and automotive companies – Canoo has designed a modular skateboard platform purpose-built to deliver maximum vehicle interior space and adaptable to support a wide range of vehicle applications for consumers and businesses. Canoo expects to launch its first consumer model in 2022, followed shortly after by a last-mile delivery vehicle and a sport vehicle, each built off of the same underlying skateboard platform.

For more information, please visit www.canoo.com.

For Canoo press materials, including photos, please visit press.canoo.com.

For investors, please visit investors.canoo.com.

Forward Looking Statements
The information in this press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of financial and performance metrics, projections of market opportunity and market share, expectations and timing related to commercial product launches, ability to accelerate Canoo’s go-to-market strategy and capitalize on commercial opportunities, potential benefits of the transaction and the potential success of Canoo’s go-to-market strategy, and expectations related to the terms and timing of completing the transaction. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of Canoo’s and HCAC’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of Canoo and HCAC. These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; the inability of the parties to successfully or timely consummate the proposed business combination, including the risk that any required regulatory approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect the combined company or the expected benefits of the proposed business combination or that the approval of the stockholders of HCAC or Canoo is not obtained; failure to realize the anticipated benefits of the proposed business combination; risks relating to the uncertainty of the projected financial information with respect to Canoo; risks related to the rollout of Canoo’s business and the timing of expected business milestones and commercial launch; risks related to future market adoption of Canoo’s offerings; risks related to Canoo’s go-to-market strategy and subscription business model; the effects of competition on Canoo’s future business; the amount of redemption requests made by HCAC’s public stockholders; the ability of HCAC or the combined company to issue equity or equity-linked securities in connection with the proposed business combination or in the future, and those factors discussed in HCAC’s final prospectus filed on March 4, 2019, Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020 and June 30, 2020, the registration statement on Form S-4 (together with all amendments thereto, the “Registration Statement”) initially filed on September 18, 2020, and the preliminary proxy statement / prospectus contained therein, in each case, under the heading “Risk Factors,” and other documents of HCAC filed, or to be filed, with the Securities and Exchange Commission (“SEC”). If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that neither HCAC nor Canoo presently know or that HCAC and Canoo currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect HCAC’s and Canoo’s expectations, plans or forecasts of future events and views as of the date of this press release. HCAC and Canoo anticipate that subsequent events and developments will cause HCAC’s and Canoo’s assessments to change. However, while HCAC and Canoo may elect to update these forward-looking statements at some point in the future, HCAC and Canoo specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing HCAC’s and Canoo’s assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.

Important Information for Investors and Shareholders
In connection with the proposed business combination, HCAC has filed the Registration Statement with the SEC. Additionally, HCAC will file other relevant materials with the SEC in connection with the business combination. Copies may be obtained free of charge at the SEC’s web site at www.sec.gov. Security holders of HCAC are urged to read the Registration Statement and the other relevant materials when they become available before making any voting decision with respect to the proposed business combination because they will contain important information about the business combination and the parties to the business combination. The information contained on, or that may be accessed through, the websites referenced in this press release is not incorporated by reference into, and is not a part of, this press release.

Participants in the Solicitation
HCAC and its directors and officers may be deemed participants in the solicitation of proxies of HCAC’s stockholders in connection with the proposed business combination. Security holders may obtain more detailed information regarding the names, affiliations and interests of certain of HCAC’s executive officers and directors in the solicitation by reading HCAC’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, and the Registration Statement and other relevant materials filed with the SEC in connection with the business combination when they become available. Information concerning the interests of HCAC’s participants in the solicitation, which may, in some cases, be different than those of their stockholders generally, are set forth in the Registration Statement.

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SOURCE Canoo

November 12, 2020 4:09 pm

Research Solutions Reports Fiscal First Quarter 2021 Results

Reports 35 Percent Year-over-Year Increase in Platform Annual Recurring Revenue to $4.7 Million

PR Newswire

HENDERSON, Nev.
, Nov. 12, 2020 /PRNewswire/ — Research Solutions, Inc. (NASDAQ: RSSS), a pioneer in providing cloud-based workflow solutions for R&D driven organizations, reported financial results for its fiscal 2021 first quarter ended September 30, 2020.

Fiscal First Quarter 2021 Summary Compared to Prior Year Quarter:

Total revenue increased 2% to $7.7 million
Platform revenue up 33% to $1.1 million, Annual recurring revenue up 35% to $4.7 million
Total gross margin improved 110 basis points to 31.6%
Net income of $15,000, an improvement of $96,000; diluted earnings per share of nil
Adjusted EBITDA of $167,000, an improvement of $131,000

“The sustained momentum within our Platforms business is evident in our first quarter fiscal 2021 results, with 31 net new deployments in the quarter and a record for Annual Recurring Revenue,” said Peter Derycz, President and CEO of Research Solutions. “We continue to enhance the product initiatives and offerings through Article Galaxy research platform to simplify, accelerate and lower the cost of information access for our users, including many within the life sciences field that continue to work on therapeutics and vaccines for COVID-19. We believe we remain well-positioned to grow our business through ongoing product improvements to our Article Galaxy platform, additional partnership opportunities, such as our most recent partnership with BIO Business Solutions, and our refined lead generation and sales approach.”

Fiscal First Quarter 2021 Results

Total revenue increased 2% to $7.7 million, compared to $7.6 million in the same year-ago quarter.

Platform subscription revenue increased 33% to approximately $1.1 million compared to $856,000 in the year-ago quarter. The increase was primarily due to an increase in the total number of paid Platform deployments, including 31 net deployments added in the quarter. The quarter ended with annual recurring revenue of $4.7 million, up 7% sequentially and 35% year-over-year (see the company’s definition of annual recurring revenue below).

Transaction revenue decreased 2% to $6.6 million compared to $6.7 million in the prior-year quarter. Transaction count increased 4.3% from the year-ago quarter to 225,000, with 1,090 transaction customers, compared to 1,134 customers in the first quarter of fiscal year 2020 (see the company’s definition of active customer accounts and transactions below).

Total gross margin improved 110 basis points from the prior-year quarter to 31.6%. The increase was primarily driven by a continued revenue mix shift to the higher-margin Platform business.

Total operating expenses were $2.4 million, essentially unchanged from the year-ago quarter.

Net income in the first quarter was $15,000, or nil per diluted share, compared to a net loss of ($81,000), or nil per share, in the prior-year quarter. Adjusted EBITDA was $167,000, a $132,000 improvement from the year-ago quarter (see definition and further discussion about the presentation of Adjusted EBITDA, a non-GAAP term, below).

Cash and cash equivalents on September 30, 2020, amounted to $10.2 million compared to $9.3 million as of June 30, 2020. There were no outstanding borrowings under the company’s $2.5 million revolving line of credit and the company had no long-term liabilities or other debt.

Conference Call

Research Solutions President and CEO Peter Derycz and CFO Alan Urban will host the conference call, followed by a question and answer period.

Date: Thursday, November 12, 2020

Time: 5:00 p.m. ET (2:00 p.m. PT)

Toll-free dial-in number: 1-855-327-6837

International dial-in number: 1-631-891-4304

Conference ID: 10011712

The conference call will be broadcast live and available for replay until December 3, 2020, by dialing 1-844-512-2921 and using the replay ID 10011712, and via the investor relations section of the company’s website at

http://researchsolutions.investorroom.com/

.

Fiscal First Quarter Financial and Operational Summary Tables vs. Prior-Year Quarter


		Quarter Ended September 30,
		2020	2019	Change	% Change
Revenue:
	Platforms	$ 1,141,688	$ 856,445	$ 285,243	33.3%
	Transactions	6,606,737	6,738,668	(131,931)	-2.0%
Total Revenue		7,748,425	7,595,113	153,312	2.0%

Gross Profit:
	Platforms	937,736	705,975	231,760	32.8%
	Transactions	1,511,840	1,610,560	(98,720)	-6.1%
Total Gross Profit		2,449,576	2,316,535	133,040	5.7%

Gross profit as a % of revenue:
	Platforms	82.1%	82.4%	-0.3%
	Transactions	22.9%	23.9%	-1.0%
Total Gross Profit		31.6%	30.5%	1.1%

Operating Expenses:
	Sales and marketing	498,374	550,349	(51,975)	-9.4%
	Technology and product development	622,961	499,191	123,770	24.8%
	General and administrative	1,161,061	1,231,345	(70,284)	-5.7%
	Depreciation and amortization	3,723	7,558	(3,835)	-50.7%
	Stock-based compensation	170,790	142,672	28,118	19.7%
	Foreign currency translation loss	(24,249)	12,123	(36,372)	-300.0%
Total Operating Expenses		2,432,660	2,443,238	(10,578)	-0.4%
Income (loss) from operations		16,915	(126,703)	143,618	113.4%

Other Income (Expenses):
	Interest expense	–	–	–
	Other income (expense)	235	25,549	(25,314)	-99.1%
	Provision for income taxes	(2,505)	(6,494)	3,989	61.4%
	Gain on sale of disc’d operations	–	26,191	(26,191)	-100.0%
Total Other Income (Expenses):		(2,270)	45,246	(47,516)	-105.0%
Net income (loss)		$ 14,645	$ (81,457)	96,102	118.0%

Adjusted EBITDA		$ 167,179	$ 35,650	$ 131,529	368.9%

		Quarter Ended September 30,
		2020	2019	Change	% Change
Platforms:
	ARR (Annual recurring revenue):
	Beginning of Period	$ 4,446,088	$ 3,224,672	$ 1,221,416	37.9%
	Incremental ARR	295,095	273,697	21,398	7.8%
	End of Period	$ 4,741,183	$ 3,498,369	$ 1,242,814	35.5%

	Deployments:
	Beginning of Period	401	301	100	33.2%
	Incremental Deployments	31	19	12	63.2%
	End of Period	432	320	112	35.0%

	ASP (Average sales price):
	Beginning of Period	$ 11,088	$ 10,713	$ 374	3.5%
	End of Period	$ 10,975	$ 10,932	$ 43	0.4%

Transactions:
	Transaction count	225,086	215,780	9,306	4.3%
	Corporate customers	805	853	(48)	-5.6%
	Academic customers	285	281	4	1.4%
	Total customers	1,090	1,134	(44)	-3.9%

Active Customer Accounts, Transactions and Annual Recurring Revenue

The company defines active customer accounts as the sum of the total quantity of customers per month for each month in the period divided by the respective number of months in the period. The quantity of customers per month is defined as customers with at least one transaction during the month.

A transaction is an order for a unit of copyrighted content fulfilled or managed in the Platform.

The company defines annual recurring revenue as the value of contracted Platform subscription recurring revenue normalized to a one-year period.

Use of Non-GAAP Measure – Adjusted EBITDA

Research Solutions’ management evaluates and makes operating decisions using various financial metrics. In addition to the company’s GAAP results, management also considers the non-GAAP measure of Adjusted EBITDA. Management believes that this non-GAAP measure provides useful information about the company’s operating results.

The tables below provide a reconciliation of this non-GAAP financial measure with the most directly comparable GAAP financial measure. Adjusted EBITDA is defined as net income (loss), plus interest expense, other income (expense), foreign currency transaction loss, provision for income taxes, depreciation and amortization, stock-based compensation, gain on sale of discontinued operations, and other potential adjustments that may arise. Set forth below is a reconciliation of Adjusted EBITDA to net income (loss):

		Quarter Ended September 30,
		2020	2019	Change	% Change
Net Income (loss)		$ 14,645	$ (81,457)	$ 96,102	118.0%
Add (deduct):
	Other income (expense)	(235)	(25,549)	25,314	99.1%
	Foreign currency translation loss	(24,249)	12,123	(36,372)	-300.0%
	Provision for income taxes	2,505	6,494	(3,989)	-61.4%
	Depreciation and amortization	3,723	7,558	(3,835)	-50.7%
	Stock-based compensation	170,790	142,672	28,118	19.7%
	Gain on sale of disc. ops.	–	(26,191)	26,191	100.0%
Adjusted EBITDA		$ 167,179	$ 35,650	$ 131,529	-368.9%

About Research Solutions and Reprints Desk

Research Solutions, Inc. (NASDAQ: RSSS) is a pioneer in providing seamless access and simplifies how organizations and individual researchers discover, acquire, and manage scholarly journal articles, book chapters and other content in scientific, technical, and medical (STM) research. More than 70 percent of the top pharmaceutical companies, prestigious universities, and emerging businesses rely on Article Galaxy, a cloud-based SaaS research platform, for simplified and lowest cost access to the latest scientific research and data. Featuring an ecosystem of app-like Gadgets for a personalized research experience, Article Galaxy offers individual as well as enterprise plans, coupled with unparalleled, 24/7 customer support. For more information and details, please visit

www.researchsolutions.com

and

www.reprintsdesk.com

Important Cautions Regarding Forward-Looking Statements

Certain statements in this press release may contain “forward-looking statements” regarding future events and our future results. All statements other than statements of historical facts are statements that could be deemed to be forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projections about the markets in which we operate and the beliefs and assumptions of our management. Words such as “expects,” “anticipates,” “targets,” “goals,” “projects”, “intends,” “plans,” “believes,” “seeks,” “estimates,” “endeavors,” “strives,” “may,” or variations of such words, and similar expressions are intended to identify such forward-looking statements. Readers are cautioned that these forward-looking statements are subject to a number of risks, uncertainties and assumptions that are difficult to predict, estimate or verify. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. Such risks and uncertainties include those factors described in the Company’s most recent annual report on Form 10-K, as such may be amended or supplemented by subsequent quarterly reports on Form 10-Q, or other reports filed with the Securities and Exchange Commission. Examples of forward-looking statements in this release include statements regarding improved liquidity, an expanded investor base and driving long-term shareholder value as a result of listing on Nasdaq, continued momentum in the Company’s business and financial performance, and the Company’s strong outlook. Readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements. For more information, please refer to the Company’s filings with the Securities and Exchange Commission.

Research Solutions, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets

	September 30 ,		June 30,
	2020		2020
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	10,187,333	$	9,311,556
Accounts receivable, net of allowance of $88,102 and $88,485, respectively		4,455,091		4,449,260
Prepaid expenses and other current assets		240,381		241,747
Prepaid royalties		1,042,558		720,367
Total current assets		15,925,363		14,722,930

Other assets:
Property and equipment, net of accumulated depreciation of $810,349 and $804,999, respectively		12,091		11,276
Deposits and other assets		6,183		6,155
Right of use asset, net of accumulated amortization of $421,469 and $390,691, respectively		41,553		72,331
Total assets	$	15,985,190	$	14,812,692

Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued expenses	$	7,382,741	$	6,349,845
Deferred revenue		3,555,579		3,524,507
Lease liability, current portion		45,550		79,326
Total current liabilities		10,983,870		9,953,678

Commitments and contingencies

Stockholders’ equity :
Preferred stock; $0.001 par value; 20,000,000 shares authorized; no shares issued and outstanding		–		–
Common stock; $0.001 par value; 100,000,000 shares authorized; 26,190,713 and 26,032,263 shares issued and outstanding, respectively		26,191		26,032
Additional paid-in capital		26,261,156		26,134,819
Accumulated deficit		(21,162,154)		(21,176,799)
Accumulated other comprehensive loss		(123,873)		(125,038)
Total stockholders’ equity		5,001,320		4,859,014
Total liabilities and stockholders’ equity	$	15,985,190	$	14,812,692

Research Solutions, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations and Other Comprehensive Income (Loss)
(Unaudited)

	Three Months Ended
	September 30 ,
	2020		2019

Revenue:
Platforms	$	1,141,688	$	856,445
Transactions		6,606,737		6,738,668
Total revenue		7,748,425		7,595,113

Cost of revenue:
Platforms		203,952		150,470
Transactions		5,094,897		5,128,108
Total cost of revenue		5,298,849		5,278,578
Gross profit		2,449,576		2,316,535

Operating expenses:
Selling, general and administrative		2,428,938		2,435,680
Depreciation and amortization		3,723		7,558
Total operating expenses		2,432,661		2,443,238
Income (loss) from operations		16,915		(126,703)

Other income		235		25,549

Income (loss) from operations before provision for income taxes		17,150		(101,154)
Provision for income taxes		(2,505)		(6,494)

Income (loss) from continuing operations		14,645		(107,648)

Gain from sale of discontinued operations		–		26,191

Net income (loss)		14,645		(81,457)

Other comprehensive income (loss): Foreign currency translation		1,165		(3,568)
Comprehensive income (loss)	$	15,810	$	(85,025)

Basic income (loss) per common share:
Income (loss) per share from continuing operations	$	–	$	–
Income per share from discontinued operations	$	–	$	–
Net income (loss) per share	$	–	$	–
Basic weighted average common shares outstanding		25,898,900		24,095,266

Diluted income (loss) per common share:
Income (loss) per share from continuing operations	$	–	$	–
Income per share from discontinued operations	$	–	$	–
Net income (loss) per share	$	–	$	–
Basic weighted average common shares outstanding		26,511,180		24,095,266

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SOURCE Research Solutions, Inc.