Last 12 Months Bookings of $8.8 Million; 100% Year-over-Year Growth
Sunnyvale, CA – August 11, 2022 – Quanergy Systems, Inc. (NYSE: QNGY) (“Quanergy”), a leading provider of LiDAR sensors and smart 3D solutions, today announced financial results for the three months ended June 30, 2022.
Second Quarter 2022 Highlights
“The second quarter marked a continuation of our growth trajectory with the company posting its fifth consecutive year over year increase in quarterly revenue. Our business is in a growth mode, supported by strong increases in bookings, deal sizes and our customer pipeline,” said Kevin Kennedy, Chairman and CEO. “We expect our bookings and revenues to continue seeing the benefit of increased market fit, repeatability and scale, driven by the superior accuracy, performance and total cost of ownership of our security, industrial and flow management solutions.”
Second Quarter 2022 Financial Results
Revenue for the second quarter of 2022 totaled $1.2 million, compared with $905 thousand in the same period of 2021, representing year over year growth of 31%. The conversion of bookings to revenue during the quarter was constrained primarily by the ramping of the company’s manufacturing capacity and the timing of certain bookings that were received late in the quarter.
GAAP gross profit was negative $1.3 million for the quarter, compared to $145 thousand in the second quarter of 2021. Excluding stock-based compensation expense, non-GAAP adjusted gross profit was negative $1.1 million for the quarter, compared to $166 thousand in the second quarter of 2021. Non-GAAP adjusted gross profit in the second quarter of 2022 was adversely impacted by $1.1 million of purchasing surcharges expensed during the quarter, ongoing supply chain constraints and transitory manufacturing costs.
GAAP net loss was $25.7 million for the quarter compared to $20.5 million for the same period in 2021.
Adjusted EBITDA loss for the second quarter of 2022 was $12.5 million compared with $6.6 million for the same period in 2021, primarily reflecting increased investments to support growth and public company costs.
As of June 30, 2022, the Company had $18.8 million in cash, cash equivalents and restricted cash on its balance sheet. During the second quarter, $9.9 million was drawn from the GEM share subscription facility leaving $115 million outstanding under the facility.
Net cash from operating activities was negative $10.6 million in the second quarter of 2022 versus negative $7.8 million in the second quarter of 2021. Free cash flow was negative $10.8 million in the second quarter of 2022 compared with negative $7.9 million in the prior year period.
(1) Bookings are defined as non-cancellable orders expected to be delivered within 12 months of purchase order receipt.
Key Operational Highlights
Outlook for 2022
The Company’s expectations with respect to Q3 2022 and full year 2022 are estimated. Actual revenues for Q3 2022 and full year 2022 are subject to completion of the Company’s financial closing procedures for the period, and the actual and reported financial results for Q3 2022 and full year 2022 may materially differ. As such, the Company’s expectations with respect to Q3 2022 and full year 2022 are inherently unpredictable and actual results and outcomes could differ materially for a variety of reasons, including the factors discussed below under “Forward-Looking Statements.”
2022 Second Quarter Conference Call and Webcast
Quanergy is hosting a conference call and webcast today, August 11, 2022, beginning at 4:30 p.m. ET to discuss the Company’s preliminary second quarter 2022 results and other matters. Both the call and the webcast are open to the general public. The conference call number is 201-389-0920 and the conference ID number is 13731117 (domestic or international). Please call five minutes prior to the presentation to ensure that you are connected.
About Quanergy Systems, Inc.
Quanergy’s (NYSE: QNGY and QNGY.WS) mission is to create powerful, affordable smart LiDAR solutions for automotive and IoT applications to enhance people’s experiences and safety. Quanergy has developed the only true 100% solid-state CMOS LiDAR sensor built on optical phased array (OPA) technology to enable the mass production of low-cost, highly reliable 3D LiDAR solutions. Through Quanergy’s smart LiDAR solutions, businesses can now leverage real-time, advanced 3D insights to transform their operations in a variety of industries including industrial automation, physical security, smart cities, smart spaces and much more. Quanergy solutions are deployed by nearly 400 customers across the globe. For more information, please visit us at www.quanergy.com.
Non-GAAP Financial Measures
In addition to its results determined in accordance with generally accepted accounting principles in the United States (“GAAP”), Quanergy believes the non-GAAP measures of non-GAAP adjusted gross profit, adjusted EBITDA and free cash flow are useful in evaluating its operating performance. Quanergy calculates non-GAAP adjusted gross profit as gross profit adding back stock-based compensation expense included in cost of goods sold. Quanergy calculates non-GAAP adjusted EBITDA as net loss adding back stock-based compensation expense, depreciation and amortization, interest expense and income, change in fair value of derivatives, gain on forgiveness of PPP loan and income tax provision (benefit). Quanergy believes that non-GAAP adjusted gross profit and non-GAAP adjusted EBITDA may be helpful to investors because they provide consistency and comparability with past financial performance and may be helpful in comparing with other companies, some of which use similar non-GAAP information to supplement their GAAP results. Free cash flow is a non-GAAP financial measure. Management believes, however, that free cash flow is an important financial measure for use in evaluating the Company’s financial performance, as it measures the Company’s ability to generate additional cash from its business operations. Quanergy defines free cash flow as cash flow from operations less capital expenditures. Free cash flow should be considered in addition to, rather than as a substitute for, net loss as a measure of our performance or net cash provided by operating activities as a measure of liquidity. Therefore, Quanergy believes it is important to view free cash flow as supplemental to the entire statement of cash flows. The non-GAAP financial information is presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with GAAP and may be different from similarly titled non-GAAP measures used by other companies. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures are included at the end of this press release.
This press release includes certain statements that are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,” “outlook,” “project,” “will likely result” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. All statements, other than statements of present or historical fact included in this press release, are forward-looking statements, including statements regarding the trajectory and growth of our business, our customer pipeline, expectations regarding bookings and revenues and the benefit of market fit, repeatability and scale, our projects with Prime Secured, Audio Technology, Nanjing Port Group, and PARIFEX, and all information included in the section titled “Outlook for 2022”. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results. Most of these factors are outside Quanergy’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: changes in domestic and foreign business, market, financial, political and legal conditions; the overall level of consumer demand for Quanergy’s products; general economic conditions and other factors affecting consumer confidence, preferences, and behavior; disruption and volatility in the global currency, capital, and credit markets; the ability to maintain the listing of Quanergy’s securities on the New York Stock Exchange; the financial strength of Quanergy’s customers; Quanergy’s ability to implement its business strategy; changes in governmental regulation, Quanergy’s exposure to litigation claims and other loss contingencies; disruptions and other impacts to Quanergy’s business, as a result of the COVID-19 global pandemic and government actions and restrictive measures implemented in response; stability of Quanergy’s suppliers and the impact of supply chain constraints, as well as consumer demand for its products, in light of disease epidemics and health-related concerns such as the COVID-19 global pandemic; the impact that global climate change trends may have on Quanergy and its suppliers and customers; Quanergy’s ability to protect patents, trademarks and other intellectual property rights; any breaches of, or interruptions in, Quanergy’s information systems; fluctuations in the price, availability and quality of electricity and other raw materials and contracted products as well as foreign currency fluctuations; Quanergy’s ability to utilize potential net operating loss carryforwards; changes in tax laws and liabilities, tariffs, legal, regulatory, political and economic risks; and other risks and uncertainties indicated in Quanergy’s filings with the U.S. Securities and Exchange Commission. In addition, forward-looking statements reflect Quanergy’s expectations, plans or forecasts of future events and views only as of the date of this press release. Quanergy anticipates that subsequent events and developments will cause its assessments to change. However, while Quanergy may elect to update these forward-looking statements at some point in the future, Quanergy specifically disclaims any obligation to do so, except as required by law.
Quanergy Systems Investor Contact:
Shannon Van Every
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