Ambarella, Inc. Announces Fourth Quarter and Fiscal Year 2023 Financial Results
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Ambarella, Inc. Announces Fourth Quarter and Fiscal Year 2023 Financial Results

SANTA CLARA, Calif., Feb. 28, 2023 (GLOBE NEWSWIRE) -- Ambarella, Inc. (NASDAQ: AMBA), an edge AI semiconductor company, today announced fourth quarter and full year fiscal 2023 financial results for the period ending January 31, 2023.

Financial results on a non-GAAP basis for the fourth quarter and full year fiscal 2023 are as follows:

Based on information available as of today, Ambarella is offering the following guidance for the first quarter of fiscal year 2024, ending April 30, 2023:

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 fourth quarter of fiscal 2023 was $206.9 million, compared with $199.0 million at the end of the prior quarter and $171.0 million at the end of the same quarter a year ago.

“We achieved significant milestones in fiscal 2023 towards our transformation to an edge AI company. CV3-AD, the first processor in our 3rd generation edge AI family, was broadly sampled, we commenced mass production of CV5, our first 5nm SoC, we introduced our centralized 4D imaging radar, and took important steps towards commercialization of our software stack IP,” said Fermi Wang, President and CEO. “Our customers indicate end market demand is healthy, but we are experiencing a more pronounced slowdown as they reduce inventory. Our Q1 revenue is expected to be well below end market consumption, and we currently do not expect these existing cyclical factors to cause future quarter revenue to decline below our Q1 guidance.”

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 fourth quarter of fiscal year 2023 results. 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 vision and edge AI 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 and radar processing, and powerful deep neural network processing to enable intelligent perception, fusion and planning. 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,” or similar expressions, including the guidance for the first quarter of fiscal year 2024 ending April 30, 2023, and the comments of our CEO relating to end market demand for products incorporating our solutions and economic and cyclical headwinds faced by the Company that may impact the Company’s future revenue, including inventory management by customers. 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 cyclical headwinds in the semiconductor industry, higher inflation and possible trade tariffs and restrictions; inventory management by our customers; 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 gain customer acceptance of our new SoC 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 is also 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 Annual Report on Form 10-K for the fiscal year ending January 31, 2023 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, and earnings per share, as a supplement to the 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 fourth 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 first quarter of fiscal year 2024, 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.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)
        
 Three Months Ended January 31, Twelve Months Ended January 31,
  2023   2022   2023   2022 
    
Revenue$83,321  $90,229  $337,606  $331,856 
        
Cost of revenue 33,676   32,907   128,672   123,724 
Gross profit 49,645   57,322   208,934   208,132 
        
Operating expenses:       
Research and development 53,054   48,543   204,946   167,337 
Selling, general and administrative 20,031   21,115   78,244   70,438 
        
Total operating expenses 73,085   69,658   283,190   237,775 
        
Loss from operations (23,440)  (12,336)  (74,256)  (29,643)
        
Other income (expense), net 1,825   (216)  3,318   1,002 
        
Loss before income taxes (21,615)  (12,552)  (70,938)  (28,641)
        
Benefit for income taxes (10,510)  (3,359)  (5,552)  (2,230)
        
Net loss$(11,105) $(9,193) $(65,386) $(26,411)
        
Net loss per share attributable to ordinary shareholders:       
Basic$(0.29) $(0.25) $(1.70) $(0.72)
Diluted$(0.29) $(0.25) $(1.70) $(0.72)
Weighted-average shares used to compute net loss per share       
attributable to ordinary shareholders:       
Basic 38,898,290   37,133,454   38,363,638   36,577,120 
Diluted 38,898,290   37,133,454   38,363,638   36,577,120 


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

 Three Months Ended January 31, Twelve Months Ended January 31,
  2023   2022   2023   2022 
 (unaudited, in thousands)
Stock-based compensation:       
Cost of revenue$2,526  $416  $3,597  $1,489 
Research and development 17,461   18,343   71,236   54,787 
Selling, general and administrative 9,120   8,775   36,325   31,525 
        
Total stock-based compensation$29,107  $27,534  $111,158  $87,801 
        




 Three Months Ended January 31, Twelve Months Ended January 31,
  2023   2022   2023   2022 
 (unaudited, in thousands)
Acquisition-related costs:       
Cost of revenue$757  $757  $3,028  $903 
Research and development    1      8 
Selling, general and administrative 488   2,220   2,066   3,821 
        
Total acquisition-related costs$1,245  $2,978  $5,094  $4,732 
        


The difference between GAAP and non-GAAP gross margin was 3.9% and 1.3%, or $3.3 million and $1.2 million, for the three months ending January 31, 2023 and 2022, respectively. The difference between GAAP and non-GAAP gross margin was 2.0% and 0.7%, or $6.6 million and $2.4 million, for the fiscal years ending January 31, 2023 and 2022, 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 January 31, Twelve Months Ended January 31,
  2023   2022   2023   2022 
 (unaudited)
GAAP net loss$(11,105) $(9,193) $(65,386) $(26,411)
        
Non-GAAP adjustments:       
Stock-based compensation expense 29,107   27,534   111,158   87,801 
Acquisition-related costs 1,245   2,978   5,094   4,732 
Income tax effect (10,310)  (3,445)  (7,785)  (3,971)
Non-GAAP net income$8,937  $17,874  $43,081  $62,151 
        
GAAP - diluted weighted average shares 38,898,290   37,133,454   38,363,638   36,577,120 
Non-GAAP - diluted weighted average shares 39,639,253   39,655,416   39,135,313   38,706,977 
        
GAAP - diluted net loss per share$(0.29) $(0.25) $(1.70) $(0.72)
Non-GAAP adjustments:       
Stock-based compensation expense 0.75   0.74   2.90   2.40 
Acquisition-related costs 0.03   0.08   0.13   0.13 
Income tax effect (0.27)  (0.09)  (0.20)  (0.11)
Effect of Non-GAAP - diluted weighted average shares 0.01   (0.03)  (0.03)  (0.09)
Non-GAAP - diluted net income per share$0.23  $0.45  $1.10  $1.61 



AMBARELLA, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
    
 January 31, January 31,
  2023   2022 
    
ASSETS   
Current assets:   
Cash and cash equivalents$113,541  $171,043 
Marketable debt securities 93,322    
Accounts receivable, net 51,987   44,307 
Inventories 40,486   45,219 
Restricted cash 8   10 
Prepaid expenses and other current assets 5,288   6,169 
Total current assets 304,632   266,748 
    
Property and equipment, net 11,814   10,134 
Deferred tax assets, non-current 19,276   15,340 
Intangible assets, net 58,497   46,302 
Operating lease right-of-use assets, net 8,339   11,127 
Goodwill 303,625   303,625 
Other non-current assets 4,012   4,269 
    
Total assets$710,195  $657,545 
    
LIABILITIES AND SHAREHOLDERS' EQUITY   
Current liabilities:   
Accounts payable 17,845   31,170 
Accrued and other current liabilities 56,655   52,064 
Operating lease liabilities, current 3,539   3,391 
Income taxes payable 4,112   1,245 
Deferred revenue, current 1,311   1,414 
Total current liabilities 83,462   89,284 
    
Operating lease liabilities, non-current 5,097   8,322 
Other long-term liabilities 15,548   12,763 
    
Total liabilities 104,107   110,369 
    
Shareholders' equity:   
Preference shares     
Ordinary shares 18   17 
Additional paid-in capital 572,076   447,287 
Accumulated other comprehensive loss (492)   
Retained earnings 34,486   99,872 
Total shareholders’ equity 606,088   547,176 
    
Total liabilities and shareholders' equity$710,195  $657,545 


Contact:

Louis Gerhardy
408.636.2310
lgerhardy@ambarella.com


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