OBLG Oblong Inc

Oblong, Inc. (NYSE American: OBLG) ("Oblong" or the "Company"), the award-winning maker of multi-stream collaboration solutions, today announced financial results for the three months ended June 30, 2020.

Financial Highlights

• Revenue of $2.8 million for the second quarter of 2020, compared to $2.4 million for the second quarter of 2019.
• Gross profit margin of 40% for the second quarter of 2020, compared to 33% for the second quarter of 2019.
• Net loss of $3.4 million for the second quarter of 2020, compared to a net loss of $0.9 million for the second quarter of 2019.
• Adjusted EBITDA (“AEBITDA”) loss of $2.0 million for the second quarter of 2020, compared to an AEBITDA loss of $0.3 million for the second quarter of 2019. AEBITDA loss is a non-GAAP financial measure. See “Non-GAAP Financial Information” below for additional information regarding this non-GAAP financial measure, and “GAAP to Non-GAAP Reconciliation” later in this release for a reconciliation of this non-GAAP financial measure to net loss.
• Cash balance of $4.1 million as of June 30, 2020.

“As enterprises look to redesign their office environments for more flexible workstyles, Oblong is accelerating its transition to a hybrid provider of technology driven interactive collaboration solutions both in and, beyond the physical office during the COVID-19 shutdown,” commented Peter Holst, Chairman and CEO of Oblong. “While this transition is underway, Oblong is increasingly engrained as a key part of the office of the future, enabling sophisticated collaboration in ways that tomorrow’s enterprises will demand and expect. The challenges during the pandemic have heightened awareness of these capabilities, as evidenced by the tailwinds Zoom, WebEx and others have experienced and, as business leaders look to the next phase of digital transformation, it’s evident the need to produce more interactive, engaged and deterministic meetings will become a key driver in how and where organizations increase productivity. Oblong’s unique technology driven solutions in spatial and gestural content distribution is expected to lead to margin expansion and accelerated growth in the months ahead.”

Non-GAAP Financial Information

Adjusted EBITDA (“AEBITDA”) loss, a non-GAAP financial measure, is defined as net loss before depreciation and amortization, stock-based compensation, impairment charges, severance, merger expenses and interest and other expense, net. AEBITDA loss is not intended to replace operating loss, net loss, cash flow or other measures of financial performance reported in accordance with generally accepted accounting principles (GAAP). Rather, AEBITDA loss is an important measure used by management to assess the operating performance of the Company and to compare such performance between periods. AEBITDA loss as defined here may not be comparable to similarly titled measures reported by other companies due to differences in accounting policies. Therefore, AEBITDA loss should be considered in conjunction with net loss and other performance measures prepared in accordance with GAAP, such as operating loss or cash flow provided by (used in) operating activities, and should not be considered in isolation or as a substitute for GAAP measures, such as net loss, operating loss or any other GAAP measure of liquidity or financial performance. A GAAP to non-GAAP reconciliation of net loss to AEBITDA loss is shown under “GAAP to Non-GAAP Reconciliation” later in this release.

About Oblong, Inc.

Oblong’s innovative and patented technologies change the way people work, create, and communicate. Oblong's flagship product Mezzanine™ is a remote meeting technology platform that offers simultaneous content sharing to achieve situational awareness for both in-room and remote collaborators. Oblong supplies Mezzanine systems to Fortune 500 enterprise customers and is a Cisco Solutions Plus integration partner. Learn more at www.oblong.com.

Forward looking and cautionary statements

This press release and any oral statements made regarding the subject of this release contain forward-looking statements as defined under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, that address activities that Oblong assumes, plans, expects, believes, intends, projects, estimates or anticipates (and other similar expressions) will, should or may occur in the future are forward-looking statements. Oblong’s actual results may differ materially from its expectations, estimates and projections, and consequently you should not rely on these forward-looking statements as predictions of future events. Without limiting the generality of the foregoing, forward-looking statements contained in this press release include statements relating to (i) the Company’s potential future growth and financial performance and (ii) the success of its products and services. The forward-looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events, and involve factors, risks, and uncertainties that may cause actual results in future periods to differ materially from such statements. A list and description of these and other risk factors can be found in the Company’s Annual Report on Form 10-K for the year ending December 31, 2019 and in other filings made by the Company with the SEC from time to time, including the Company’s Quarterly Report on Form 10-Q for the three and six months ended June 30, 2020, filed with the SEC on August 14, 2020 (the “Quarterly Report”). Any of these factors could cause Oblong’s actual results and plans to differ materially from those in the forward-looking statements. Therefore, the Company can give no assurance that its future results will be as estimated. The Company does not intend to, and disclaims any obligation to, correct, update, or revise any information contained herein. The Company’s consolidated financial results for the three and six months ended June 30, 2019 do not reflect the financial results of its wholly owned subsidiary, Oblong Industries, Inc., as the Company’s acquisition of Oblong Industries closed on October 1, 2019. Please see “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations--Oblong’s Results of Operations” in the Quarterly Report for more information regarding the comparison of the Company’s financial results between periods. 

OBLONG, INC. CONDENSED CONSOLIDATED BALANCE SHEETS ($ in thousands) (June 30, 2020 Unaudited)

 

 

June 30, 2020

 

December 31, 2019

 

 

(Unaudited)

 

 

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash

 

$

4,141

 

 

$

4,602

 

Accounts receivable, net

 

1,360

 

 

2,543

 

Inventory

 

1,344

 

 

1,816

 

Prepaid expenses and other current assets

 

919

 

 

965

 

Total current assets

 

7,764

 

 

9,926

 

Property and equipment, net

 

910

 

 

1,316

 

Goodwill

 

7,366

 

 

7,907

 

Intangibles, net

 

11,348

 

 

12,572

 

Operating lease - right of use asset, net

 

1,806

 

 

3,117

 

Other assets

 

99

 

 

71

 

Total assets

 

$

29,293

 

 

$

34,909

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Current portion of long-term debt, net of discount

 

$

3,665

 

 

$

2,664

 

Accounts payable

 

643

 

 

647

 

Accrued expenses and other current liabilities

 

1,174

 

 

1,752

 

Deferred revenue

 

2,139

 

 

1,901

 

Current portion of operating lease liabilities

 

898

 

 

1,294

 

Total current liabilities

 

8,519

 

 

8,258

 

Long-term liabilities:

 

 

 

 

Long-term debt, net of current portion and net of discount

 

4,304

 

 

2,843

 

Operating lease liabilities, net of current portion

 

1,063

 

 

2,020

 

Other long-term liabilities

 

—

 

 

3

 

Total long-term liabilities

 

5,367

 

 

4,866

 

Total liabilities

 

13,886

 

 

13,124

 

Total stockholders’ equity

 

15,407

 

 

21,785

 

Total liabilities and stockholders’ equity

 

$

29,293

 

 

$

34,909

 

OBLONG, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited)

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2020

 

2019

 

2020

 

2019

Revenue

$

2,816

 

 

$

2,439

 

 

$

8,144

 

 

$

5,033

 

Cost of revenue (exclusive of depreciation and amortization)

1,683

 

 

1,644

 

 

4,072

 

 

3,319

 

Gross profit

1,133

 

 

795

 

 

4,072

 

 

1,714

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

988

 

 

249

 

 

2,315

 

 

462

 

Sales and marketing

834

 

 

40

 

 

2,040

 

 

73

 

General and administrative

1,815

 

 

770

 

 

3,842

 

 

1,882

 

Impairment charges

—

 

 

453

 

 

550

 

 

453

 

Depreciation and amortization

796

 

 

157

 

 

1,612

 

 

316

 

Total operating expenses

4,433

 

 

1,669

 

 

10,359

 

 

3,186

 

Loss from operations

(3,300

)

 

(874

)

 

(6,287

)

 

(1,472

)

Interest and other expense, net

85

 

 

1

 

 

227

 

 

1

 

Net loss

(3,385

)

 

(875

)

 

(6,514

)

 

(1,473

)

Preferred stock dividends

4

 

 

4

 

 

8

 

 

19

 

Net loss attributable to common stockholders

$

(3,389

)

 

$

(879

)

 

$

(6,522

)

 

$

(1,492

)

 

 

 

 

 

 

 

 

Basic and diluted net loss per share

$

(0.65

)

 

$

(0.17

)

 

$

(1.25

)

 

$

(0.29

)

 

 

 

 

 

 

 

 

GAAP to Non-GAAP Reconciliation:

Net loss

$

(3,385

)

 

$

(875

)

 

$

(6,514

)

 

$

(1,473

)

Depreciation and amortization

 

796

 

 

 

157

 

 

 

1,612

 

 

 

316

 

Interest and other expense, net

 

85

 

 

 

1

 

 

 

227

 

 

 

1

 

Impairment charges

 

—

 

 

 

453

 

 

 

550

 

 

 

453

 

Merger expenses

 

—

 

 

 

(87

)

 

 

—

 

 

 

174

 

Severance

 

475

 

 

 

—

 

 

 

515

 

 

 

—

 

Stock-based compensation

 

29

 

 

 

24

 

 

 

61

 

 

 

53

 

Adjusted EBITDA Loss 

$

(2,000

)

 

$

(327

)

 

$

(3,549

)

 

$

(476

)

 

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