SANTA CLARA, Calif., May 31, 2022 (GLOBE NEWSWIRE) -- Ambarella, Inc. (NASDAQ: AMBA), an edge AI vision silicon company, today announced financial results for its first quarter of fiscal year 2023 ended April 30, 2022.

• Revenue for the first quarter of fiscal 2023 was $90.3 million, up 29% from $70.1 million in the same period in fiscal 2022.
• Gross margin under U.S. generally accepted accounting principles (GAAP) for the first quarter of fiscal 2023 was 62.6%, compared with 62.4% for the same period in fiscal 2022.
• GAAP net loss for the first quarter of fiscal 2023 was $10.8 million, or loss per diluted ordinary share of $0.29, compared with GAAP net loss of $10.8 million, or loss per diluted ordinary share of $0.30, for the same period in fiscal 2022.

Financial results on a non-GAAP basis for the first quarter of fiscal 2023 are as follows:

• Gross margin on a non-GAAP basis for the first quarter of fiscal 2023 was 63.8%, compared with 62.9% for the same period in fiscal 2022.
• Non-GAAP net income for the first quarter of fiscal 2023 was $17.1 million, or earnings per diluted ordinary share of $0.44. This compares with non-GAAP net income of $8.9 million, or earnings per diluted ordinary share of $0.23, for the same period in fiscal 2022.

Based on information available as of today, Ambarella is offering the following guidance for the second quarter of fiscal year 2023, ending July 31, 2022:

• Revenue is expected to be between $78.0 million to $82.0 million.
• Gross margin on a non-GAAP basis is expected to be between 63.0% and 64.0%.
• Operating expenses on a non-GAAP basis are expected to be between $42.0 million and $45.0 million.

Ambarella reports gross margin, net income (loss) and earnings (losses) per share in accordance with GAAP and, additionally, on a non-GAAP basis. Non-GAAP financial information excludes the impact of stock-based compensation and acquisition-related costs adjusted for the associated tax impact, which includes the effect of any benefits or shortfalls recognized. A reconciliation of the GAAP to non-GAAP gross margin, net income (loss) and earnings (losses) per share for the periods presented, as well as a description of the items excluded from the non-GAAP calculations, is included in the financial statements portion of this press release.

Total cash, cash equivalents and marketable debt securities on hand at the end of the first quarter of fiscal 2023 was $200.6 million, compared with $171.0 million at the end of the prior quarter and $435.5 million at the end of the same quarter a year ago. Ambarella fully liquidated its debt security investments by the end of the third quarter of fiscal 2022 to finance the acquisition of Oculii Corp.

“Our near-term outlook is under pressure with the flare-up of the pandemic in China and resulting lock-down, which is disrupting our orders and our customers’ production, as well as logistics throughout the greater Asia supply-chain. Despite this, our confidence in our AI processor strategy, opportunity and business remains very high. We are excited to have received first silicon of CV3, our first central domain controller, and we expect it will be sampled to key customers over the summer and demonstrate a significant leadership position in both performance and power,” said Fermi Wang, President and CEO. “We continue to expect our computer vision revenue to grow significantly to represent about 45% of F2023 revenue, with the richer mix anticipated to continue to drive our average selling price higher.”

Stock Repurchase

During the second quarter of fiscal year 2023, Ambarella’s Board of Directors approved an extension of the current share repurchase program for an additional twelve months ending June 30, 2023. The company did not repurchase shares in the first quarter of fiscal 2023. As of today, approximately $49.0 million is available for repurchases under the program. The repurchase program does not obligate the company to acquire any particular amount of ordinary shares, and it may be suspended at any time at the company’s discretion.

Quarterly Conference Call

Ambarella plans to hold a conference call at 4:30 p.m. Eastern Time / 1:30 p.m. Pacific Time today with Fermi Wang, President and Chief Executive Officer, and Brian White, Chief Financial Officer, to discuss the first quarter of fiscal year 2023 results. The call can be accessed by dialing 877-304-8963 in the USA; international callers should dial 760-666-4834. Please dial in ten minutes prior to the scheduled conference call time. A live and archived webcast of the call will be available on Ambarella’s website at http://www.ambarella.com/ for up to 30 days after the call.

About Ambarella

Ambarella’s products are used in a wide variety of human and computer vision applications, including video security, advanced driver assistance systems (ADAS), electronic mirror, drive recorder, driver/cabin monitoring, autonomous driving and robotics applications. Ambarella’s low-power systems-on-chip (SoCs) offer high-resolution video compression, advanced image processing and powerful deep neural network processing to enable intelligent perception, fusion and central processing systems to extract valuable data from high-resolution video and radar streams. For more information, please visit www.ambarella.com

"Safe harbor" statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements that are not historical facts and often can be identified by terms such as “outlook,” “projected,” “intends,” “will,” “estimates,” “anticipates,” “expects,” “believes,” “could,” “should,” or similar expressions, including the guidance for the second quarter of fiscal year 2023 ending July 31, 2022, and the comments of our CEO relating to supply-chain challenges faced by the Company, the Company’s expectations regarding its CV5 and CV3 products, the expectation for growth of CV product revenue and associated impact on the Company’s average selling price, and potential secular growth opportunities for the Company’s AI computer vision processors. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. Our actual results could differ materially from those predicted or implied and reported results should not be considered as an indication of our future performance.

The risks and uncertainties referred to above include, but are not limited to, risks associated with global health conditions and associated risk mitigation measures; global economic and political conditions, including possible trade tariffs and restrictions; supply chain challenges in the semiconductor industry and markets we serve; revenue being generated from new customers or design wins, neither of which is assured; the commercial success of our customers’ products; our growth strategy; our ability to anticipate future market demands and future needs of our customers, particularly for computer vision applications; our ability to introduce new and enhanced solutions; our ability to develop, and to generate revenue from, new advanced technologies, such as computer vision functionality; our ability to retain and expand customer relationships and to achieve design wins; the expansion of our current markets and our ability to successfully enter new markets, such as the OEM automotive and robotics markets; anticipated trends and challenges, including competition, in the markets in which we operate; our ability to effectively manage growth; our ability to retain key employees; and the potential for intellectual property disputes or other litigation.

Further information on these and other factors that could affect our financial results is included in the company’s Annual Report on Form 10-K for our 2022 fiscal year, which is on file with the Securities and Exchange Commission. Additional information will also be set forth in the company’s quarterly reports on Form 10-Q, annual reports on Form 10-K and other filings the company makes with the Securities and Exchange Commission from time to time, copies of which may be obtained by visiting the Investor Relations portion of our web site at www.ambarella.com or the SEC's web site at www.sec.gov. Undue reliance should not be placed on the forward-looking statements in this release, which are based on information available to us on the date hereof. The results we report in our Quarterly Report on Form 10-Q for the first fiscal quarter ended April 30, 2022 could differ from the preliminary results announced in this press release.

Ambarella assumes no obligation and does not intend to update the forward-looking statements made in this press release, except as required by law.

Non-GAAP Financial Measures

The company has provided in this release non-GAAP financial information, including non-GAAP gross margin, net income (loss), and earnings (losses) per share, as a supplement to the condensed consolidated financial statements, which are prepared in accordance with generally accepted accounting principles ("GAAP"). Management uses these non-GAAP financial measures internally in analyzing the company’s financial results to assess operational performance and liquidity. The company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning, forecasting and analyzing future periods. Further, the company believes these non-GAAP financial measures are useful to investors because they allow for greater transparency with respect to key financial metrics that the company uses in making operating decisions and because the company believes that investors and analysts use them to help assess the health of its business and for comparison to other companies. Non-GAAP results are presented for supplemental informational purposes only for understanding the company’s operating results. The non-GAAP information should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from non-GAAP measures used by other companies.

With respect to its financial results for the first quarter of fiscal year 2023, the company has provided below reconciliations of its non-GAAP financial measures to its most directly comparable GAAP financial measures. With respect to the company’s expectations for the second quarter of fiscal year 2023, a reconciliation of non-GAAP gross margin and non-GAAP operating expenses guidance to the closest corresponding GAAP measure is not available without unreasonable efforts on a forward-looking basis due to the high variability and low visibility with respect to the charges excluded from these non-GAAP measures. We expect the variability of the above charges to have a significant, and potentially unpredictable, impact on our future GAAP financial results.

AMBARELLA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)
	Three Months Ended April 30,
		2022				2021
Revenue	$	90,305			$	70,133
Cost of revenue		33,758				26,368
Gross profit		56,547				43,765
Operating expenses:
Research and development		46,690				37,874
Selling, general and administrative		20,355				16,027
Total operating expenses		67,045				53,901
Loss from operations		(10,498	)			(10,136	)
Other income, net		86				593
Loss before income taxes		(10,412	)			(9,543	)
Provision for income taxes		410				1,275
Net loss	$	(10,822	)		$	(10,818	)
Net loss per share attributable to ordinary shareholders:
Basic	$	(0.29	)		$	(0.30	)
Diluted	$	(0.29	)		$	(0.30	)
Weighted-average shares used to compute net loss per share attributable to ordinary shareholders:
Basic		37,715,338				35,940,304
Diluted		37,715,338				35,940,304

The following tables present details of stock-based compensation and acquisition-related costs included in each functional line item in the condensed consolidated statements of operations above:

	Three Months Ended April 30,
		2022				2021
	(unaudited, in thousands)
Stock-based compensation:
Cost of revenue	$	349			$	323
Research and development		17,151				11,194
Selling, general and administrative		9,541				7,325
Total stock-based compensation	$	27,041			$	18,842

	Three Months Ended April 30,
		2022				2021
	(unaudited, in thousands)
Acquisition-related costs:
Cost of revenue	$	757			$	—
Research and development		—				—
Selling, general and administrative		536				—
Total acquisition-related costs	$	1,293			$	—

The difference between GAAP and non-GAAP gross margin was 1.2% and 0.5%, or $1.1 million and $0.3 million, for the three months ended April 30, 2022 and April 30, 2021, respectively. The differences were due to the effect of stock-based compensation and the amortization of acquisition-related costs.

AMBARELLA, INC.
RECONCILIATION OF GAAP TO NON-GAAP DILUTED EARNINGS (LOSSES) PER SHARE
(in thousands, except share and per share data)
	Three Months Ended April 30,
		2022				2021
	(unaudited)
GAAP net loss	$	(10,822	)		$	(10,818	)
Non-GAAP adjustments:
Stock-based compensation expense		27,041				18,842
Acquisition-related costs		1,293				—
Income tax effect		(446	)			899
Non-GAAP net income	$	17,066			$	8,923
GAAP - diluted weighted average shares		37,715,338				35,940,304
Non-GAAP - diluted weighted average shares		39,002,530				38,081,315
GAAP - diluted net loss per share	$	(0.29	)		$	(0.30	)
Non-GAAP adjustments:
Stock-based compensation expense		0.72				0.52
Acquisition-related costs		0.03				—
Income tax effect		(0.01	)			0.03
Effect of Non-GAAP - diluted weighted average shares		(0.01	)			(0.02	)
Non-GAAP - diluted net income per share	$	0.44			$	0.23

AMBARELLA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
	April 30,				January 31,
		2022				2022
ASSETS
Current assets:
Cash and cash equivalents	$	200,639			$	171,043
Accounts receivable, net		28,008				44,307
Inventories		41,523				45,219
Restricted cash		10				10
Prepaid expenses and other current assets		8,149				6,169
Total current assets		278,329				266,748
Property and equipment, net		10,138				10,134
Deferred tax assets, non-current		13,970				15,340
Intangible assets, net		48,477				46,302
Operating lease right-of-use assets, net		10,292				11,127
Goodwill		303,625				303,625
Other non-current assets		3,834				4,269
Total assets	$	668,665			$	657,545
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable		29,763				31,170
Accrued and other current liabilities		39,354				52,064
Operating lease liabilities, current		3,293				3,391
Income taxes payable		1,481				1,245
Deferred revenue, current		964				1,414
Total current liabilities		74,855				89,284
Operating lease liabilities, non-current		7,438				8,322
Other long-term liabilities		12,024				12,763
Total liabilities		94,317				110,369
Shareholders' equity:
Preference shares		—				—
Ordinary shares		17				17
Additional paid-in capital		485,281				447,287
Retained earnings		89,050				99,872
Total shareholders’ equity		574,348				547,176
Total liabilities and shareholders' equity	$	668,665			$	657,545

Contact:

Louis Gerhardy408.636.2310[email protected]

Source: Ambarella

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