UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact name of Registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission file number) | (I.R.S. Employer Identification No.) | ||||||||||||
(Address of principal executive offices and zip code)
(408 ) 467-1900
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8‑K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b–2 of the Securities Exchange Act of 1934 (§240.12b–2 of this chapter).
Emerging Growth Company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On November 14, 2022, Immersion Corporation (the “Company”) issued a press release regarding financial results for the third quarter ended September 30, 2022. A copy of the press release is attached to this Current Report as Exhibit 99.1, and the information in Exhibit 99.1 is incorporated herein by reference.
The information in Item 2.02 and Exhibit 99.1 in this Current Report on Form 8-K shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
Item 8.01 Other Events.
On November 14, 2022, the Company announced that its Board of Directors (the “Board”) declared a quarterly dividend. The first quarterly dividend, in the amount of $0.03 per share, will be payable, subject to any prior revocation, on January 30, 2023 to stockholders of record on January 15, 2023. Future dividends will be subject to further review and approval by the Board in accordance with applicable law. The Board reserves the right to adjust or withdraw the quarterly dividend in future periods as it reviews the Company’s capital allocation strategy from time-to-time.
Forward Looking Statements
This Item 8.01 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, including statements regarding the Company’s dividend program. These forward-looking statements are subject to involve risks and uncertainties. These forward-looking statements may be identified by terms such as “will,” “may,” “plans,” or the negative of these terms, and similar expressions intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding the anticipated amount, duration, methods, timing and other aspects of our dividend program and any anticipated benefits or value resulting from any such dividends. These statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, any unforeseen need for capital which may require us to divert funds we may have otherwise used for the dividend program, which may in turn negatively impact our ability to administer the quarterly dividends. In addition, the timing and amount of future dividends, if any, will be made as management deems appropriate and will depend on a variety of factors including stock price, market conditions, corporate and regulatory requirements (including applicable securities laws and regulations and the rules of The Nasdaq Stock Market), any additional constraints related to material inside information the Company may possess, and capital availability. More information regarding these and other risks, uncertainties and factors is contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC, and in other reports filed by the Company with the SEC from time to time. You are cautioned not to unduly rely on these forward-looking statements, which speak only as of the date of this Form 8-K. All information in this Form 8-K is as of the date stated and unless required by law, the Company undertakes no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this Form 8-K or to report the occurrence of unanticipated events other than as required by law or regulation.
Item 9.01 Financial Statements and Exhibits.
a.Exhibits
Exhibit No. | Exhibit Title | ||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | ||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| IMMERSION CORPORATION | ||||||||||||||||||||
| Date: | November 14, 2022 | By: | /s/ AARON AKERMAN | |||||||||||||||||
| Name: | Aaron Akerman | |||||||||||||||||||
| Title: | Chief Financial Officer | |||||||||||||||||||
Exhibit 99.1
Immersion Corporation Reports Third Quarter 2022 Results
Announces quarterly dividend
Repurchases 7 percent of shares outstanding year to date
AVENTURA FL, November 14, 2022 – Immersion Corporation (NASDAQ: IMMR), a leading developer and provider of technologies for haptics, today reported financial results for the third quarter ended September 30, 2022.
Third Quarter Financial Summary:
• Total revenues of $14.0 million, compared to $7.2 million in the third quarter of 2021. Royalty and license revenues were $13.9 million, compared to $7.1 million in the third quarter of 2021.
• GAAP operating expenses of $3.1 million declined 12% from $3.5 million in the third quarter of 2021. Non-GAAP operating expenses of $2.3 million declined 18% from $2.8 million in the third quarter of 2021. (See attached table for a reconciliation of GAAP to non-GAAP financial measures.)
• GAAP net income was $7.7 million, or $0.23 per diluted share, compared to GAAP net income of $3.8 million, or $0.12 per diluted share, in the third quarter of 2021.
• Non-GAAP net income was $9.4 million, or $0.28 per diluted share, compared to non-GAAP net income of $4.7 million, or $0.15 per diluted share in the third quarter of 2021.
•Cash, cash equivalents and short-term investments were $133.5 million as of September 30, 2022.
Eric Singer, Executive Chairman, stated, “Notwithstanding a very difficult macroeconomic backdrop, Immersion’s financial strength allowed for significant share repurchases during the quarter of 954,247 shares. On a year-to-date basis, we repurchased 2,542,065 shares (7.4% of shares outstanding at December 31, 2021) at an average price of $5.20 per share.” Singer continued, “In addition, the Board of Directors has approved a quarterly cash dividend of $0.03 per share, which underscores our confidence in the financial strength of the company and commitment to return capital to shareholders in a meaningful way. We are focused on renewing license agreements, protecting our intellectual property and pursuing thoughtful capital allocation to drive long-term shareholder value.”
Recent Business Highlights:
•Renewed multi-year agreement with Nippon Seiki, pursuant to which Nippon Seiki obtained a license to Immersion’s patent portfolio for Nippon Seiki’s printer products, copier products, and automotive products.
•Renewed multi-year agreement with Google pursuant to which Google has obtained a license to Immersion’s patent portfolio for Google and Fitbit products. Other terms of the agreement are confidential.
The first quarterly dividend will be paid on January 30, 2023 to shareholders of record on January 15, 2023. Future quarterly dividends will be subject to further review and approval by the Board in accordance with applicable law. The Board reserves the right to adjust or withdraw the quarterly dividend in future periods as it reviews the Company’s capital allocation strategy from time-to-time. In addition,
the Company’s current stock repurchase program allows for the repurchase of shares with an aggregate value of up to an additional $21 million.
About Immersion
Immersion Corporation (NASDAQ: IMMR) is a leading innovator of touch feedback technology, also known as haptics. The company invents, accelerates, and scales haptic experiences by providing technology solutions for mobile, automotive, gaming, and consumer electronics. Haptic technology creates immersive and realistic experiences that enhance digital interactions by engaging users' sense of touch. Learn more at www.immersion.com.
Use of Non-GAAP Financial Measures
Immersion reports all financial information required in accordance with generally accepted accounting principles (GAAP), but it believes that evaluating its ongoing operating results may be difficult to understand if limited to reviewing only GAAP financial measures. Immersion discloses this non-GAAP information, such as Non-GAAP net income and Non-GAAP net income per diluted share because it is useful in understanding the company’s performance as it excludes certain non-cash expenses like stock-based compensation expense and other special charges, such as deferred tax assets valuation allowance, depreciation and restructuring costs, that many investors feel may obscure the company’s true operating performance. Likewise, management uses these non-GAAP financial measures to manage and assess the profitability of its business. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP. The non-GAAP financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release.
Forward-looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The forward-looking statements involve risks and uncertainties. Forward-looking statements are identified by words such as “anticipates,” “believes,” “expects,” “intends,” “may,” “can,” “will,” “places,” “estimates,” and other similar expressions. However, these words are not the only way we identify forward-looking statements. Examples of forward-looking statements include any expectations, projections, or other characterizations of future events, or circumstances, including but not limited to statements about the financial strength of the company and commitment to return capital to shareholders in a meaningful way, and the Company’s focus on renewing license agreements, protecting its intellectual property and pursuing thoughtful capital allocation to drive long-term shareholder value.
Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Actual results could differ materially from those projected in the forward-looking statements, therefore we caution you not to place undue reliance on these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: the inability to predict the outcome of any litigation, the costs associated with any litigation and the risks related to our business, both direct and
indirect, of initiating litigation, the effects of the COVID-19 global pandemic on the Company and its business, and on the business of its suppliers and customers; unanticipated changes in the markets in which the Company operates; the effects of the current macroeconomic climate (especially in light of the ongoing adverse effects of the COVID-19 global pandemic); delay in or failure to achieve adoption of or commercial demand for the Company’s products or third party products incorporating the Company’s technologies; the inability of Immersion to renew existing licensing arrangements, or enter into new licensing arrangements on favorable terms; the loss of a major customer; the ability of Immersion to protect and enforce its intellectual property rights and other factors. For a more detailed discussion of these factors, and other factors that could cause actual results to vary materially, interested parties should review the risk factors listed in Immersion’s Annual Report on Form 10-K for 2021 and in its most recent Quarterly Report on Form 10-Q which are on file with the U.S. Securities and Exchange Commission. Any forward-looking statements made by us in this press release speak only as of the date of this press release, and Immersion does not intend to update these forward-looking statements after the date of this press release, except as required by law.
Immersion, and the Immersion logo are trademarks of Immersion Corporation in the United States and other countries. All other trademarks are the property of their respective owners. The use of the word “partner” or “partnership” in this press release does not mean a legal partner or legal partnership.
(IMMR – C)
Immersion Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
| September 30, 2022 | December 31, 2021 | ||||||||||
| (Unaudited) | (1) | ||||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 36,767 | $ | 51,490 | |||||||
| Investments - current | 96,779 | 86,431 | |||||||||
| Accounts and other receivables | 3,343 | 1,970 | |||||||||
| Prepaid expenses and other current assets | 7,731 | 13,432 | |||||||||
| Total current assets | 144,620 | 153,323 | |||||||||
| Property and equipment, net | 362 | 444 | |||||||||
| Investments - noncurrent | 18,520 | 7,286 | |||||||||
| Long-term deposits | 4,425 | 9,658 | |||||||||
| Other assets | 3,290 | 4,809 | |||||||||
| TOTAL ASSETS | $ | 171,217 | $ | 175,520 | |||||||
| LIABILITIES | |||||||||||
| Accounts payable | $ | 14 | $ | 2 | |||||||
| Accrued compensation | 1,270 | 555 | |||||||||
| Deferred revenue - current | 4,763 | 4,826 | |||||||||
| Other current liabilities | 7,729 | 11,247 | |||||||||
| Total current liabilities | 13,776 | 16,630 | |||||||||
| Deferred revenue - noncurrent | 13,808 | 16,699 | |||||||||
| Other long-term liabilities | 479 | 896 | |||||||||
| Total liabilities | 28,063 | 34,225 | |||||||||
| STOCKHOLDERS’ EQUITY | 143,154 | 141,295 | |||||||||
| TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY | $ | 171,217 | $ | 175,520 | |||||||
| (1) Derived from Immersion’s annual audited consolidated financial statements. | |||||||||||
Immersion Corporation
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
| (1) | (1) | (1) | (1) | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Royalty and license | $ | 13,931 | $ | 7,068 | $ | 29,079 | $ | 25,017 | |||||||||||||||
| Development, services, and other | 75 | 105 | 218 | 325 | |||||||||||||||||||
| Total revenues | 14,006 | 7,173 | 29,297 | 25,342 | |||||||||||||||||||
| Costs and expenses: | |||||||||||||||||||||||
| Cost of revenues | — | 8 | 4 | 78 | |||||||||||||||||||
| Sales and marketing | 282 | 443 | 986 | 2,743 | |||||||||||||||||||
| Research and development | 254 | 803 | 1,118 | 3,442 | |||||||||||||||||||
| General and administrative | 2,540 | 2,246 | 8,550 | 7,106 | |||||||||||||||||||
| Total costs and expenses | 3,076 | 3,500 | 10,658 | 13,369 | |||||||||||||||||||
| Operating Income | 10,930 | 3,673 | 18,639 | 11,973 | |||||||||||||||||||
| Interest and other income (loss), net | (2,348) | 438 | (6,413) | 162 | |||||||||||||||||||
| Income before provision for income taxes | 8,582 | 4,111 | 12,226 | 12,135 | |||||||||||||||||||
| Provision for income taxes | (877) | (340) | (1,264) | (987) | |||||||||||||||||||
| Net Income | $ | 7,705 | $ | 3,771 | $ | 10,962 | $ | 11,148 | |||||||||||||||
| Basic net income per share | $ | 0.23 | $ | 0.12 | $ | 0.33 | $ | 0.36 | |||||||||||||||
| Shares used in calculating basic net income per share | 33,201 | 32,474 | 33,601 | 30,693 | |||||||||||||||||||
| Diluted net income per share | $ | 0.23 | $ | 0.12 | $ | 0.32 | $ | 0.36 | |||||||||||||||
| Shares used in calculating diluted net income per share | 33,682 | 32,612 | 34,035 | 31,065 | |||||||||||||||||||
| (1) unaudited quarterly financial data | ||
Immersion Corporation
Reconciliation of GAAP Net Income to Non-GAAP Net Income
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
| GAAP net income | $ | 7,705 | $ | 3,771 | $ | 10,962 | $ | 11,148 | |||||||||||||||
| Add: Provision for income taxes | 877 | 340 | 1,264 | 987 | |||||||||||||||||||
| Less: Non-GAAP provision for income taxes | (15) | (95) | (662) | (139) | |||||||||||||||||||
| Add: Stock-based compensation | 730 | 415 | 2,661 | 1,997 | |||||||||||||||||||
| Add: Restructuring expense | — | 186 | — | 612 | |||||||||||||||||||
| Add: Depreciation and amortization of property and equipment | 28 | 25 | 95 | 75 | |||||||||||||||||||
| Other nonrecurring charges | 46 | 100 | 294 | 100 | |||||||||||||||||||
| Non-GAAP net income | $ | 9,371 | $ | 4,742 | $ | 14,614 | $ | 14,780 | |||||||||||||||
| Non-GAAP net income per diluted share | $ | 0.28 | $ | 0.15 | $ | 0.43 | $ | 0.48 | |||||||||||||||
| Shares used in calculating Non-GAAP net income per diluted share | 33,682 | 32,612 | 34,035 | 31,065 | |||||||||||||||||||
Immersion Corporation
Disaggregated Revenue Information
(In thousands)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
| Fixed fee license revenue | $ | 7,662 | $ | 1,247 | $ | 10,653 | $ | 4,346 | |||||||||||||||
| Per-unit royalty revenue | 6,269 | 5,821 | 18,426 | 20,671 | |||||||||||||||||||
| Total royalty and license revenue | 13,931 | 7,068 | 29,079 | 25,017 | |||||||||||||||||||
| Development, services, and other revenue | 75 | 105 | 218 | 325 | |||||||||||||||||||
| Total revenues | $ | 14,006 | $ | 7,173 | $ | 29,297 | $ | 25,342 | |||||||||||||||
Immersion Corporation
Revenue by Line of Business
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
| Mobility | 75 | % | 60 | % | 67 | % | 61 | % | |||||||||||||||
| Gaming | 14 | % | 28 | % | 19 | % | 23 | % | |||||||||||||||
| Automotive | 5 | % | 12 | % | 8 | % | 14 | % | |||||||||||||||
| Other | 6 | % | — | % | 6 | % | 2 | % | |||||||||||||||
| Total revenues | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||
Immersion Corporation
Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses
(In thousands)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
| GAAP operating expenses | $ | 3,076 | $ | 3,492 | $ | 10,654 | $ | 13,291 | |||||||||||||||
| Adjustments to GAAP operating expenses: | |||||||||||||||||||||||
| Stock-based compensation expense - S&M | (19) | (141) | (20) | (678) | |||||||||||||||||||
| Stock-based compensation expense - R&D | (18) | (118) | (96) | (653) | |||||||||||||||||||
| Stock-based compensation expense - G&A | (693) | (156) | (2,545) | (666) | |||||||||||||||||||
| Restructuring expense | — | (186) | — | (612) | |||||||||||||||||||
| Depreciation and amortization expense of property and equipment | (28) | (25) | (95) | (75) | |||||||||||||||||||
| Other nonrecurring charges | (46) | (100) | (294) | (100) | |||||||||||||||||||
| Non-GAAP operating expenses | $ | 2,272 | $ | 2,766 | $ | 7,604 | $ | 10,507 | |||||||||||||||
Investor Contact:
Aaron Akerman
Immersion Corporation
514-987-9800 ext. 5110
aakerman@immersion.com