Kornit Digital Reports the First Quarter 2023 Results
- First quarter revenues of 47.8 millions dollars, in line prior guidance
- First quarter GAAP loss of $18.9 millions; non-GAAP loss of 13.4 million
- MAX upgrades drive strong quarter for Services
- Double-digit growth in impressions from several strategic clients
- Atlas MAX Poly and Direct to Fabric customers added to key textile regions
- Set to present new breakthrough solutions at the June ITMA tradeshow, Milan, Italy
ROSH-HA`AYIN, Israel — Kornit Digital Ltd. (“Kornit” or “the Company”), a worldwide market leader in sustainable, on-demand, digital fashionX and textile production technologies, reported today its results for the first quarter ended March 31, 2023.
“Promising indicators emerged during the first quarter in certain parts of our business, despite the persistent macroeconomic pressures,” said Ronen Samuel, Kornit’s Chief Executive Officer. “These indicators included the double-digit year-over-year impressions growth from several of our larger direct-to-garment (DTG) strategic accounts in the customized design market, and the continued adoption of our MAX technology. While capacity utilization is still not optimal, we see immense opportunities unfolding with major demand generating platforms and expect this market to resume growth as overall macro conditions improve.”
Mr. Samuel continued, “With our MAX technology as the cornerstone, we’ve been steadily gaining momentum on our strategy in targeting brands, retailers, and their global fulfillers, all of whom will greatly benefit from Kornit’s sustainable on-demand digital solutions, instead of existing analog production. Atlas MAX Poly enjoyed a successful quarter. We also continued to consolidate our market-leading position for direct-to-fabric with Presto MAX. The progress made in the first quarter offers additional proof points that our MAX technology is becoming the industry standard and an excellent solution that offers top retail quality output, increased productivity, better cost efficiencies, and new product capabilities and offerings.”
Mr. Samuel concluded, “We are excited to attend the upcoming ITMA tradeshow in Milan, where we will demonstrate how digital production goes mainstream with sustainable on-demand manufacturing at scale. We will present a wide range of cutting-edge DTF, DTG, and DTP solutions, including the highly anticipated Apollo which will revolutionize markets traditionally serviced by analog. These new systems and solutions significantly extend the breadth of print applications and offer levels of automation never before seen in any of the markets we serve.”
First Quarter 2023 Results
Total revenue for the first three months of 2023 is expected to be $47.8M, compared to $83.3M in the previous year period. This is primarily due lower system revenues.
GAAP gross margin for the first three months of 2023 was 27,4%, compared to 40.1% during the same period last year. Non-GAAP gross profit margin for the first quarter of 2023 was 30.2%, compared to 41.5% during the previous year period.
Operating expenses on a GAAP basis for the first quarter 2023 decreased 7.7% to $37.2 Million compared to the prior year period. Operating expenses on a non-GAAP base also decreased by 8.0%, to $32.4 Million compared to the prior year period.
GAAP net loss was $18.9 millions, or $0.38 per basic share. This compares to a net loss of $5.9 million or $0,10 per basic share for the first three months of 2022.
Non-GAAP Net Loss for the First Quarter of 2023 was 13.4 million dollars, or ($0.27) each basic share. This compares to non-GAAP Net Income of $0.2 million dollars, or $0.00 each diluted share for the First Quarter of 2022.
The first quarter of the year 2023 saw an adjusted EBITDA deficit of $14.7 million, compared to $1.5 for the first three months of 2022. The adjusted EBITDA for the first three months of 2023 was 30.8%, while the first three months of 2022 had an adjusted EBITDA of 1.8%.
Second Quarter 2023 Guidance
The Company expects revenue to be between $54 million and $59 million for the second quarter 2023. It also expects an adjusted EBITDA of -19% to 27% of revenue. The guidance for revenue and adjusted EBITDA margin includes the impact of the non-cash expense associated with the fair value of the Company’s warrants.
First Quarter Earnings conference Call Information
The Company will hold a conference call at 8:30 a.m. ET today. The results will be discussed at 3:30 pm ET or 3:30 pm Israel time. This will be followed by a Q&A session with investors.
You can access a live webcast at ir.kornit.com. To access the call participants can dial toll-free 1-888-8867786 or 1 416-764-8658. The Israeli toll free number is 0809 468 221. The conference confirmation code is 795398.
To listen to the replay of the conference, dial toll free 1-844-512-3021 or 1-412-317-667 (international) and enter the confirmation code 79530398. The telephonic recording will be available for approximately three hours following the conclusion of the live call, until 11:59 pm ET Wednesday, May 24, 2020. The call will also be available for replay via the webcast link on Kornit’s Investor Relations website.
Visit www.kornit.com for more information on how Kornit Digital is transforming the fashion and textiles industry.