Cover
Cover - shares | 3 Months Ended | |
Sep. 30, 2023 | Nov. 03, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2024 | |
Current Fiscal Year End Date | --06-30 | |
Entity File Number | 1-16027 | |
Entity Registrant Name | LANTRONIX, INC. | |
Entity Central Index Key | 0001114925 | |
Entity Tax Identification Number | 33-0362767 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 48 Discovery | |
Entity Address, Address Line Two | Suite 250 | |
Entity Address, City or Town | Irvine | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92618 | |
City Area Code | (949) | |
Local Phone Number | 453-3990 | |
Title of 12(b) Security | Common Stock, $0.0001 par value | |
Trading Symbol | LTRX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 37,265,332 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 19,479 | $ 13,452 |
Accounts receivable, net | 30,105 | 27,682 |
Inventories, net | 45,796 | 49,736 |
Contract manufacturers' receivables | 630 | 3,019 |
Prepaid expenses and other current assets | 2,895 | 2,662 |
Total current assets | 98,905 | 96,551 |
Property and equipment, net | 4,926 | 4,629 |
Goodwill | 27,824 | 27,824 |
Purchased intangible assets, net | 9,181 | 10,565 |
Lease right-of-use assets | 11,102 | 11,583 |
Other assets | 461 | 472 |
Total assets | 152,399 | 151,624 |
Current liabilities: | ||
Accounts payable | 9,149 | 12,401 |
Accrued payroll and related expenses | 2,539 | 2,431 |
Current portion of long-term debt, net | 3,002 | 2,743 |
Other current liabilities | 34,062 | 28,813 |
Total current liabilities | 48,752 | 46,388 |
Long-term debt, net | 15,471 | 16,221 |
Other non-current liabilities | 11,185 | 11,459 |
Total liabilities | 75,408 | 74,068 |
Commitments and contingencies (Note 9) | ||
Stockholders' equity: | ||
Common stock | 4 | 4 |
Additional paid-in capital | 297,007 | 295,686 |
Accumulated deficit | (220,391) | (218,505) |
Accumulated other comprehensive income | 371 | 371 |
Total stockholders' equity | 76,991 | 77,556 |
Total liabilities and stockholders' equity | $ 152,399 | $ 151,624 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||
Net revenue | $ 33,031 | $ 31,795 |
Cost of revenue | 18,934 | 17,759 |
Gross profit | 14,097 | 14,036 |
Operating expenses: | ||
Selling, general and administrative | 9,170 | 9,157 |
Research and development | 5,106 | 4,526 |
Restructuring, severance and related charges | 20 | 92 |
Acquisition-related costs | 0 | 213 |
Fair value remeasurement of earnout consideration | (9) | 0 |
Amortization of purchased intangible assets | 1,384 | 1,419 |
Total operating expenses | 15,671 | 15,407 |
Loss from operations | (1,574) | (1,371) |
Interest expense, net | (338) | (262) |
Other income, net | 19 | 34 |
Loss before income taxes | (1,893) | (1,599) |
Provision (benefit) for income taxes | (7) | 54 |
Net loss | $ (1,886) | $ (1,653) |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - $ / shares shares in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||
Net loss per share - basic | $ (0.05) | $ (0.05) |
Net loss per share - diluted | $ (0.05) | $ (0.05) |
Weighted-average common shares - basic | 36,982 | 35,406 |
Weighted-average common shares - diluted | 36,982 | 35,406 |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Beginning balance, value at Jun. 30, 2022 | $ 4 | $ 289,046 | $ (209,525) | $ 371 | $ 79,896 |
Beginning balance, shares at Jun. 30, 2022 | 35,129 | ||||
Shares issued pursuant to stock awards, net | 21 | 21 | |||
Shares issued pursuant to stock awards, net, shares | 1,110 | ||||
Tax withholding paid on behalf of employees for restricted shares | (314) | (314) | |||
Share-based compensation | 1,788 | 1,788 | |||
Net loss | (1,653) | (1,653) | |||
Ending balance, value at Sep. 30, 2022 | $ 4 | 290,541 | (211,178) | 371 | 79,738 |
Ending balance, shares at Sep. 30, 2022 | 36,239 | ||||
Beginning balance, value at Jun. 30, 2023 | $ 4 | 295,686 | (218,505) | 371 | 77,556 |
Beginning balance, shares at Jun. 30, 2023 | 36,875 | ||||
Shares issued pursuant to stock awards, net | 93 | 93 | |||
Shares issued pursuant to stock awards, net, shares | 385 | ||||
Tax withholding paid on behalf of employees for restricted shares | (514) | (514) | |||
Share-based compensation | 1,742 | 1,742 | |||
Net loss | (1,886) | (1,886) | |||
Ending balance, value at Sep. 30, 2023 | $ 4 | $ 297,007 | $ (220,391) | $ 371 | $ 76,991 |
Ending balance, shares at Sep. 30, 2023 | 37,260 |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating activities | ||
Net loss | $ (1,886) | $ (1,653) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Share-based compensation | 1,742 | 1,788 |
Depreciation and amortization | 528 | 349 |
Amortization of purchased intangible assets | 1,384 | 1,419 |
Amortization of manufacturing profit in acquired inventory associated with acquisitions | 317 | 24 |
Loss on disposal of property and equipment | 0 | (10) |
Amortization of deferred debt issuance costs | 27 | 22 |
Fair value remeasurement of earnout consideration | (9) | 0 |
Changes in operating assets and liabilities, net of assets and liabilities acquired: | ||
Accounts receivable | (2,423) | 1,493 |
Inventories | 3,623 | (4,015) |
Contract manufacturers' receivable | 2,389 | 2,522 |
Prepaid expenses and other current assets | (233) | 1,134 |
Lease right-of-use assets | 481 | 221 |
Other assets | 11 | (56) |
Accounts payable | (3,591) | (6,133) |
Accrued payroll and related expenses | 108 | (806) |
Other liabilities | 5,030 | (965) |
Net cash provided by (used in) operating activities | 7,498 | (4,666) |
Investing activities | ||
Purchases of property and equipment | (486) | (956) |
Cash payment for acquisitions, net of cash and cash equivalents acquired | 0 | (4,650) |
Net cash used in investing activities | (486) | (5,606) |
Financing activities | ||
Net proceeds from issuances of common stock | 93 | 21 |
Tax withholding paid on behalf of employees for restricted shares | (514) | (314) |
Net proceeds from issuance of debt | 0 | 4,909 |
Payment of borrowings on term loan | (518) | (438) |
Net proceeds from borrowing on line of credit | 0 | 2,000 |
Payment of lease liabilities | (46) | (2) |
Net cash provided by (used in) financing activities | (985) | 6,176 |
Increase (decrease) in cash and cash equivalents | 6,027 | (4,096) |
Cash and cash equivalents at beginning of period | 13,452 | 17,221 |
Cash and cash equivalents at end of period | $ 19,479 | $ 13,125 |
Company and Significant Account
Company and Significant Accounting Policies | 3 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Company and Significant Accounting Policies | 1. Company and Significant Accounting Policies Company Lantronix, Inc., which we refer to herein as the Company, Lantronix, we, our, or us, is a global industrial and enterprise internet of things (“IoT”) provider of solutions that target diversified verticals ranging from smart cities, utilities and healthcare to enterprise, intelligent transportation, and industrial automation. Building on a long history of connectivity and video processing competence, target applications include video surveillance, traffic management, infotainment systems, robotics, edge computing and remote environment management. Basis of Presentation The accompanying unaudited condensed consolidated financial statements of Lantronix have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Securities and Exchange Commission (“SEC”) Regulation S-X. Accordingly, they should be read in conjunction with the audited consolidated financial statements and notes thereto for the fiscal year ended June 30, 2023, included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2023, which was filed with the SEC on September 12, 2023. The unaudited condensed consolidated financial statements contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the consolidated financial position of Lantronix at September 30, 2023, the consolidated results of our operations for the three months ended September 30, 2023 and our consolidated cash flows for the three months ended September 30, 2023. All intercompany accounts and transactions have been eliminated. Significant Accounting Policies Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Accounting measurements at interim dates inherently involve greater reliance on estimates than at year-end. The results of operations for the three months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year or any future interim periods. Recent Accounting Pronouncements Current Expected Credit Losses In June 2016, the Financial Accounting Standards Board (“FASB”) issued a new Accounting Standards Update (“ASU”) requiring financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The ASU eliminates the threshold for initial recognition in current U.S. GAAP and reflects an entity’s current estimate of all expected credit losses. The measurement of expected credit losses is based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the financial assets. The ASU became effective for Lantronix at the beginning of our first quarter of fiscal year 2024. The adoption of this guidance did have a material effect on our consolidated financial statements. |
Revenue
Revenue | 3 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 2. Revenue Revenue is recognized upon the transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. We apply the following five-step approach in determining the amount and timing of revenue to be recognized: (i) identifying the contract with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when the performance obligation is satisfied. On occasion we enter into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Revenue is recognized net of (i) any taxes collected from customers, which are subsequently remitted to governmental authorities and (ii) shipping and handling costs collected from customers. Products Most of our product revenue is recognized as a distinct single performance obligation when products are tendered to a carrier for delivery, which represents the point in time that our customer obtains control of the promised products. A smaller portion of our product revenue is recognized when our customer receives delivery of the promised products. A significant portion of our products are sold to distributors under agreements which contain (i) limited rights to return unsold products and (ii) price adjustment provisions, both of which are accounted for as variable consideration when estimating the amount of revenue to recognize. We base our estimates for returns and price adjustments primarily on historical experience; however, we also consider contractual allowances, approved pricing adjustments and other known or anticipated returns and price adjustments in a given period. Such estimates are generally made at the time of shipment to the customer and updated at the end of each reporting period as additional information becomes available and only to the extent that it is probable that a significant reversal of any incremental revenue will not occur. Our estimates of accrued variable consideration are included in other current liabilities in the accompanying unaudited condensed consolidated balance sheets. Services Revenues from our extended warranty, technical support and maintenance services are generally recognized ratably over the applicable service period. Although not significant to date, revenues from sales of our software-as-a-service (“SaaS”) solutions are recognized ratably over the applicable service period as well. We prepay sales commissions related to certain of these contracts, which are incremental costs of obtaining the contract. We capitalize these costs and expense them ratably on a straight-line basis over the life of the contract. At September 30, 2023, prepaid sales commissions included in prepaid expenses and other current assets totaled $ 155,000 47,000 Engineering Services We derive a portion of our revenues from engineering and related consulting service contracts with customers. Revenues from professional engineering services are generally recognized as services are performed. These contracts generally include performance obligations in which control is transferred over time because the customer either simultaneously receives and consumes the benefits provided or our performance on the contract creates or enhances an asset that the customer controls. These contracts typically provide services on the following basis: · Time & Materials (“T&M”) – services consist of revenues from software modification, consulting implementation, training and integration services. These services are set forth separately in the contractual arrangements such that the total price of the customer arrangement is expected to vary depending on the actual time and materials incurred based on the customer’s needs. · Fixed Price – arrangements to render specific consulting and software modification services which tend to be more complex. Performance obligations for T&M contracts qualify for the "Right to Invoice" practical expedient within the revenue guidance. Under this practical expedient, we may recognize revenue, over time, in the amount to which we have a right to invoice. In addition, we are not required to estimate variable consideration upon inception of the contract and reassess the estimate each reporting period. We have determined that this method best represents the transfer of services as, upon billing, we have a right to consideration from a customer in an amount that directly corresponds with the value to the customer of our performance completed to date. We recognize revenue on fixed price contracts, over time, using an input method based on the proportion of our actual costs incurred (generally labor hours expended) to the total costs expected to complete the contract performance obligation. We have determined that this method best represents the transfer of services as the proportion closely depicts the efforts or inputs completed towards the satisfaction of a fixed price contract performance obligation. Multiple Performance Obligations From time to time, we may enter into contracts with customers that include promises to transfer multiple deliverables that may include sales of products, professional engineering services and other product qualification or certification services. Determining whether the deliverables in such arrangements are considered distinct performance obligations that should be accounted for separately versus together often requires judgment. We consider performance obligations to be distinct when the customer can benefit from the promised good or service on its own or by combining it with other resources readily available and when the promised good or service is separately identifiable from other promised goods or services in the contract. In such arrangements, we allocate revenue on a relative standalone selling price basis by maximizing the use of observable inputs to determine the standalone selling price for each performance obligation. Net Revenue by Product Line and Geographic Region We organize our products and solutions into three product lines: Embedded IoT Solutions, IoT System Solutions, and Software & Services. Our Embedded IoT products are normally embedded into new designs. These products include application processing that delivers compute to meet customer needs for data transformation, computer vision, machine learning, augmented / virtual reality, audio / video aggregation and distribution, and custom applications at the edge. Our IoT System products include wired and wireless connections that enhance the value and utility of modern electronic systems and equipment by providing secure network connectivity, power for IoT end devices through Power over Ethernet (“PoE”), application hosting, protocol conversion, media conversion, secure access for distributed IoT deployments and many other functions. Our Software & Services products can be classified as either (i) our SaaS platform, which enables customers to easily deploy, monitor, manage, and automate across their global deployments, all from a single platform login, virtually connected as though directly on each device, (ii) engineering services, which is a flexible business model that allows customers to select from turnkey product development or team augmentation for accelerating complex areas of product development or (iii) extended warranty, support and maintenance. We conduct our business globally and manage our sales teams by three geographic regions: the Americas; Europe, Middle East, and Africa (“EMEA”); and Asia Pacific Japan (“APJ”). The following tables present our net revenue by product line and by geographic region. Net revenues by geographic region are based on the “bill-to” location of our customers: Schedule of net revenue by product lines Three Months Ended September 30, 2023 2022 (In thousands) Embedded IoT Solutions $ 11,373 $ 15,095 IoT System Solutions 19,036 14,621 Software & Services 2,622 2,079 $ 33,031 $ 31,795 Schedule of net revenue by geographic region Three Months Ended September 30, 2023 2022 (In thousands) Americas $ 22,933 $ 20,930 EMEA 6,591 5,201 Asia Pacific Japan 3,507 5,664 $ 33,031 $ 31,795 The following table presents product revenues and service revenues as a percentage of our total net revenue: Schedule of percentage total net revenues Three Months Ended September 30, 2023 2022 Product revenues 93 94 Service revenues 7 6 Service revenues are comprised primarily of professional services, software license subscriptions, and extended warranties. Contract Balances In certain instances, the timing of revenue recognition may differ from the timing of invoicing to our customers. We record a contract asset receivable when revenue is recognized prior to invoicing, and a contract or deferred revenue liability when revenue is recognized subsequent to invoicing. With respect to product shipments, we expect to fulfill contract obligations within one year and so we have elected not to separately disclose the amount nor the timing of recognition of these remaining performance obligations. For contract balances related to contracts that include services and multiple performance obligations, refer to the deferred revenue discussion below. Deferred Revenue Deferred revenue is primarily comprised of unearned revenue related to our extended warranty, support and maintenance services and certain software services. These services are generally invoiced at the beginning of the contract period and revenue is recognized ratably over the service period. Current and non-current deferred revenue balances represent revenue allocated to the remaining unsatisfied performance obligations at the end of a reporting period and are respectively included in other current liabilities and other non-current liabilities in the accompanying unaudited condensed consolidated balance sheets. The following table presents the changes in our deferred revenue balance for the three months ended September 30, 2023 (in thousands): Schedule of changes in deferred revenue Balance, June 30, 2023 $ 3,381 New performance obligations 1,598 Recognition of revenue from satisfying performance obligations (1,125 ) Balance, September 30, 2023 3,854 Less: non-current portion of deferred revenue (1,086 ) Current portion, September 30, 2023 $ 2,768 We currently expect to recognize substantially all of the non-current portion of deferred revenue over the next 2 to 5 years. |
Acquisition
Acquisition | 3 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisition | 3. Acquisition Remeasurement of Earnout Consideration from Uplogix Acquisition Our September 12, 2022 merger agreement with Uplogix, Inc. (“Uplogix”) provided for the holders of Uplogix note agreements, and certain former Uplogix employees, with the right to receive up to an additional $4,000,000 in the aggregate (the “Earnout Amount”), payable after the closing of the acquisition based on revenue targets for the business of Uplogix as specified in the merger agreement. The Earnout Amount was based on Uplogix achieving revenue of $7,000,000 to $14,000,000 for the period beginning at the September 12, 2022 closing date and ending on September 30, 2023. The table below presents the change in the earnout consideration liability through September 30, 2023 (in thousands): Schedule of change in the earnout consideration liability Preliminary estimated fair value of earnout consideration $ 1,718 Remeasurement estimates during fiscal 2023 (447 ) Payments – Balance at June 30, 2023 $ 1,271 Final remeasurement estimate (9 ) Balance at September 30, 2023 $ 1,262 The balance of this liability, as reported in the table above, is recorded in other current liabilities on the accompanying unaudited condensed consolidated balance sheets at September 30, 2023 and June 30, 2023. We expect to disburse the $ 1,262,000 |
Supplemental Financial Informat
Supplemental Financial Information | 3 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Financial Information | 4. Supplemental Financial Information Inventories Schedule of inventories September 30, June 30, 2023 2023 (In thousands) Finished goods $ 22,339 $ 25,670 Raw materials 23,457 24,066 Inventories $ 45,796 $ 49,736 Other Liabilities The following table presents details of our other liabilities: Schedule of other liabilities September 30, June 30, 2023 2023 (In thousands) Current Accrued variable consideration $ 2,139 $ 2,167 Customer deposits and refunds 21,102 16,344 Accrued raw materials purchases 316 267 Deferred revenue 2,768 2,493 Lease liability 1,942 1,859 Taxes payable 393 647 Warranty reserve 807 788 Other accrued operating expenses 4,595 4,248 Total other current liabilities $ 34,062 $ 28,813 Non-current Lease liability $ 9,884 $ 10,425 Deferred tax liability 215 146 Deferred revenue 1,086 888 Total other non-current liabilities $ 11,185 $ 11,459 The customer deposits and refunds balances in the table above include a significant deposit from a customer as prepayment for expected future shipments under their contract. Computation of Net Loss per Share Basic and diluted net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the applicable period. The following table presents the computation of net loss per share: Schedule of computation of net income (loss) per share Three Months Ended September 30, 2023 2022 (In thousands, except per share data) Numerator: Net loss $ (1,886 ) $ (1,653 ) Denominator: Weighted-average common shares outstanding - basic and diluted 36,982 35,406 Net loss per share - basic and diluted $ (0.05 ) $ (0.05 ) The following table presents the common stock equivalents excluded from the diluted net loss per share calculation, because they were anti-dilutive for the periods presented. These excluded common stock equivalents could be dilutive in the future. Schedule of antidilutive securities Three Months Ended September 30, 2023 2022 (In thousands) Common stock equivalents 667 948 Purchased Intangible Assets The following table presents details of purchased intangible assets: Schedule of purchased intangible assets September 30, 2023 June 30, 2023 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value (In thousands) Developed technology $ 6,331 $ (4,234 ) $ 2,097 $ 6,331 $ (3,881 ) $ 2,450 Customer relationships 17,528 (10,444 ) 7,084 17,528 (9,487 ) 8,041 Trademark and trade name 1,425 (1,425 ) – 1,425 (1,351 ) 74 $ 25,284 $ (16,103 ) $ 9,181 $ 25,284 $ (14,719 ) $ 10,565 We do not currently have any purchased intangible assets with indefinite useful lives. As of September 30, 2023, future estimated amortization expense is as follows: Schedule of future estimated amortization expense Years Ending June 30, (In thousands) 2024 (remainder) $ 3,930 2025 3,685 2026 1,177 2027 326 2028 63 Total $ 9,181 Restructuring, Severance and Related Charges The following table presents details of the liability we recorded related to restructuring, severance and related activities: Schedule of severance and related charges Three Months Ended September 30, 2023 (In thousands) Beginning balance $ 97 Charges 20 Payments (101 ) Ending balance $ 16 These balances are recorded in accrued payroll and related expenses in the accompanying unaudited condensed consolidated balance sheets. In October 2023, we undertook a reduction in our labor force to better align our staffing with our business objectives. The severance and related charges in connection with this action are expected to approximate $ 500,000 Supplemental Cash Flow Information The following table presents non-cash investing transactions excluded from the accompanying unaudited condensed consolidated statements of cash flows: Schedule of non-cash investing transactions Three Months Ended September 30, 2023 2022 (In thousands) Accrued property and equipment paid for in the subsequent period $ 339 $ 589 |
Warranty Reserve
Warranty Reserve | 3 Months Ended |
Sep. 30, 2023 | |
Guarantees and Product Warranties [Abstract] | |
Warranty Reserve | 5. Warranty Reserve The standard warranty periods we provide for our products typically range from one to five years. Certain products carry a limited lifetime warranty, which requires us to repair or replace a defective product or offer a refund of a portion of the purchase price based on a depreciated value at our option. We establish reserves for estimated product warranty costs at the time revenue is recognized based upon our historical warranty experience, and for any known or anticipated product warranty issues. The following table presents details of our warranty reserve, which is included in other current liabilities in the unaudited condensed consolidated balance sheets: Schedule of warranty reserve Three Months Ended Year Ended September 30, June 30, 2023 2023 (In thousands) Beginning balance $ 788 $ 594 Charged to cost of revenue 59 352 Usage (40 ) (158 ) Ending balance $ 807 $ 788 |
Bank Loan Agreements
Bank Loan Agreements | 3 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Bank Loan Agreements | 6. Bank Loan Agreements In September 2022 we entered into a Third Amendment to the Third Amended and Restated Loan and Security Agreement (the “Amendment”) with Silicon Valley Bank (“SVB”), pertaining to our existing term loan and revolving credit facility (together, the “Senior Credit Facilities”), which amends that certain Third Amended and Restated Loan and Security Agreement, dated as of August 2, 2021, as amended by the First Amendment to Third Amended and Restated Loan and Security Agreement, dated as of October 21, 2021, as amended by the Second Amendment to Third Amended and Restated Loan and Security Agreement, dated as of February 15, 2022 by and among Lantronix and SVB (collectively with the Amendment, the “Loan Agreement”). The Amendment, among other things, provided for an additional term loan in the original principal amount of $ 5,000,000 August 2, 2025 Term Secured Overnight Financing Rate (“ 4,000,000 25,000 In April 2023, we entered into a Letter Agreement (the “Letter Agreement”) with SVB, which, among other matters, amended the Loan Agreement to reduce the former requirement to hold 85% of our company-wide cash balances at SVB to 50%, and provided a waiver of any event of default under the Loan Agreement for any failure to comply with this covenant prior to the date of the Letter Agreement. The following table summarizes our outstanding debt under the Senior Credit Facilities: Summary of outstanding debt September 30, June 30, 2023 2023 (In thousands) Outstanding borrowings on term loan $ 18,675 $ 19,194 Less: Unamortized debt issuance costs (202 ) (230 ) Net Carrying amount of debt 18,473 18,964 Less: Current portion (3,002 ) (2,743 ) Non-current portion $ 15,471 $ 16,221 Outstanding borrowings on revolving credit facility $ – $ – During the three months ended September 30, 2023, we recognized $ 450,000 Financial Covenants The Senior Credit Facilities require Lantronix to comply with a minimum liquidity test, a maximum leverage ratio and a minimum fixed charge coverage ratio. We are currently in compliance with all financial covenants. Liquidity The Senior Credit Facilities require that we maintain a minimum liquidity of $4,000,000 at SVB, as measured at the end of each month. Maximum leverage ratio The Senior Credit Facilities require that we maintain a maximum leverage ratio, calculated as the ratio of funded debt to the consolidated trailing 12 month earnings before interest, taxes, depreciation and amortization, and certain other allowable exclusions of (i) 2.50 to 1.00 for each calendar quarter ending June 30, 2021 through and including September 30, 2022, (ii) 2.25 to 1.00 for each calendar quarter ending December 31, 2022 through and including September 30, 2023, and (iii) 2.00 to 1.00 for the calendar quarter ending December 31, 2023 and each calendar quarter thereafter. Minimum fixed charge coverage ratio The Senior Credit Facilities require that we maintain a minimum fixed charge coverage ratio, calculated as the ratio of consolidated trailing 12 month earnings before interest, taxes, depreciation and amortization, and certain other allowable exclusions, less capital expenditures and taxes paid, to the trailing twelve month principal and interest payments on all funded debt of 1.25 to 1.00 as measured at the end of each calendar quarter. In addition, the Senior Credit Facilities contain customary representations and warranties, affirmative and negative covenants, including covenants that limit or restrict Lantronix and its subsidiaries’ ability to incur liens, incur indebtedness, dispose of assets, make investments, make certain restricted payments, merge or consolidate and enter into certain speculative hedging arrangements. The Senior Credit Facilities include a number of events of default, including, among other things, non-payment defaults, covenant defaults, cross-defaults to other materials indebtedness, bankruptcy and insolvency defaults and material judgment defaults. If any event of default occurs (subject, in certain instances, to specified grace periods), the principal, premium, if any, interest and any other monetary obligations on all the then outstanding amounts under the Senior Credit Facilities may become due and payable immediately. |
Stockholders_ Equity
Stockholders’ Equity | 3 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Stockholders’ Equity | 7. Stockholders’ Equity Stock Options The following table presents a summary of activity with respect to our stock options: Schedule of option activity Weighted- Average Number of Exercise Price Shares per Share (In thousands) Balance of options outstanding at June 30, 2023 1,325 $ 3.65 Expired (489 ) 4.00 Exercised (133 ) 1.68 Balance of options outstanding at September 30, 2023 703 $ 3.79 Restricted Stock Units (“RSUs”) The following table presents a summary of activity with respect to our RSUs: Schedule of RSU activity Weighted- Average Grant Date Number of Fair Value Shares per Share (In thousands) Balance of RSUs outstanding at June 30, 2023 1,189 $ 5.70 Granted 90 4.19 Forfeited (26 ) 5.65 Vested (244 ) 5.79 Balance of RSUs outstanding at September 30, 2023 1,009 $ 5.55 Performance Stock Units (“PSUs”) The following table presents a summary of activity with respect to our PSUs: Schedule of PSU activity Number of Shares (In thousands) Balance of PSUs outstanding at June 30, 2023 931 Granted 689 Forfeited (346 ) Vested (174 ) Balance of PSUs outstanding at September 30, 2023 1,100 Employee Stock Purchase Plan (“ESPP”) The following table presents a summary of activity under our ESPP: Schedule of ESPP activity Number of Shares (In thousands) Shares available for issuance at June 30, 2023 381 Shares issued – Shares available for issuance at September 30, 2023 381 Share-Based Compensation Expense The following table presents a summary of share-based compensation expense included in each functional line item on our accompanying unaudited condensed consolidated statements of operations: Schedule of share-based compensation expense Three Months Ended September 30, 2023 2022 (In thousands) Cost of revenue $ 41 $ 51 Selling, general and administrative 1,273 1,405 Research and development 428 332 Total share-based compensation expense $ 1,742 $ 1,788 The following table presents the remaining unrecognized share-based compensation expense related to our outstanding share-based awards as of September 30, 2023: Schedule of unrecognized share-based compensation expense Remaining Remaining Unrecognized Weighted- Compensation Average Years Expense To Recognize (In thousands) Stock options $ 340 2.6 RSUs 5,095 2.0 PSUs 4,095 2.4 Stock purchase rights under ESPP 43 0.1 $ 9,573 If there are any modifications or cancellations of the underlying unvested share-based awards, we may be required to accelerate, increase or cancel remaining unearned share-based compensation expense. Future share-based compensation expense and unearned share-based compensation will increase to the extent that we grant additional share-based awards. |
Income Taxes
Income Taxes | 3 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 8. Income Taxes We utilize the liability method of accounting for income taxes. The following table presents our effective tax rates based upon our provision for income taxes for the periods shown: Schedule of effective tax rates Three Months Ended September 30, 2023 2022 Effective tax rate 0 3 The difference between our effective tax rates in the periods presented above and the federal statutory rate is primarily due to (i) a tax benefit from our domestic losses being recorded with a full valuation allowance, (ii) our current estimates of pre-tax profitability for the full fiscal year and (iii) the effect of foreign earnings taxed at rates differing from the federal statutory rate. We have recorded a net deferred tax liability of $ 215,000 146,000 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies From time to time, we are involved in various legal proceedings and claims arising in the ordinary course of our business. Although the results of legal proceedings and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not, individually or in the aggregate, have a material adverse effect on our business, operating results, financial condition or cash flows. However, regardless of the outcome, litigation can have an adverse impact on us because of legal costs, diversion of management time and resources, and other factors. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Event | 10. Subsequent Event On November 6, 2023, we announced that our Board of Directors has appointed Saleel Awsare to serve as the Company’s President and Chief Executive Officer effective as of November 20, 2023. In addition to other compensation, the Company will grant Mr. Awsare a stock unit award covering a number of shares of our common stock equal to $4,150,000 made up of a combination of RSUs and PSUs scheduled to vest over the next three years. |
Company and Significant Accou_2
Company and Significant Accounting Policies (Policies) | 3 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Company | Company Lantronix, Inc., which we refer to herein as the Company, Lantronix, we, our, or us, is a global industrial and enterprise internet of things (“IoT”) provider of solutions that target diversified verticals ranging from smart cities, utilities and healthcare to enterprise, intelligent transportation, and industrial automation. Building on a long history of connectivity and video processing competence, target applications include video surveillance, traffic management, infotainment systems, robotics, edge computing and remote environment management. |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements of Lantronix have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Securities and Exchange Commission (“SEC”) Regulation S-X. Accordingly, they should be read in conjunction with the audited consolidated financial statements and notes thereto for the fiscal year ended June 30, 2023, included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2023, which was filed with the SEC on September 12, 2023. The unaudited condensed consolidated financial statements contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the consolidated financial position of Lantronix at September 30, 2023, the consolidated results of our operations for the three months ended September 30, 2023 and our consolidated cash flows for the three months ended September 30, 2023. All intercompany accounts and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Accounting measurements at interim dates inherently involve greater reliance on estimates than at year-end. The results of operations for the three months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year or any future interim periods. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Current Expected Credit Losses In June 2016, the Financial Accounting Standards Board (“FASB”) issued a new Accounting Standards Update (“ASU”) requiring financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The ASU eliminates the threshold for initial recognition in current U.S. GAAP and reflects an entity’s current estimate of all expected credit losses. The measurement of expected credit losses is based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the financial assets. The ASU became effective for Lantronix at the beginning of our first quarter of fiscal year 2024. The adoption of this guidance did have a material effect on our consolidated financial statements. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of net revenue by product lines | Schedule of net revenue by product lines Three Months Ended September 30, 2023 2022 (In thousands) Embedded IoT Solutions $ 11,373 $ 15,095 IoT System Solutions 19,036 14,621 Software & Services 2,622 2,079 $ 33,031 $ 31,795 |
Schedule of net revenue by geographic region | Schedule of net revenue by geographic region Three Months Ended September 30, 2023 2022 (In thousands) Americas $ 22,933 $ 20,930 EMEA 6,591 5,201 Asia Pacific Japan 3,507 5,664 $ 33,031 $ 31,795 |
Schedule of percentage total net revenues | Schedule of percentage total net revenues Three Months Ended September 30, 2023 2022 Product revenues 93 94 Service revenues 7 6 |
Schedule of changes in deferred revenue | Schedule of changes in deferred revenue Balance, June 30, 2023 $ 3,381 New performance obligations 1,598 Recognition of revenue from satisfying performance obligations (1,125 ) Balance, September 30, 2023 3,854 Less: non-current portion of deferred revenue (1,086 ) Current portion, September 30, 2023 $ 2,768 |
Acquisition (Tables)
Acquisition (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of change in the earnout consideration liability | Schedule of change in the earnout consideration liability Preliminary estimated fair value of earnout consideration $ 1,718 Remeasurement estimates during fiscal 2023 (447 ) Payments – Balance at June 30, 2023 $ 1,271 Final remeasurement estimate (9 ) Balance at September 30, 2023 $ 1,262 |
Supplemental Financial Inform_2
Supplemental Financial Information (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of inventories | Schedule of inventories September 30, June 30, 2023 2023 (In thousands) Finished goods $ 22,339 $ 25,670 Raw materials 23,457 24,066 Inventories $ 45,796 $ 49,736 |
Schedule of other liabilities | Schedule of other liabilities September 30, June 30, 2023 2023 (In thousands) Current Accrued variable consideration $ 2,139 $ 2,167 Customer deposits and refunds 21,102 16,344 Accrued raw materials purchases 316 267 Deferred revenue 2,768 2,493 Lease liability 1,942 1,859 Taxes payable 393 647 Warranty reserve 807 788 Other accrued operating expenses 4,595 4,248 Total other current liabilities $ 34,062 $ 28,813 Non-current Lease liability $ 9,884 $ 10,425 Deferred tax liability 215 146 Deferred revenue 1,086 888 Total other non-current liabilities $ 11,185 $ 11,459 |
Schedule of computation of net income (loss) per share | Schedule of computation of net income (loss) per share Three Months Ended September 30, 2023 2022 (In thousands, except per share data) Numerator: Net loss $ (1,886 ) $ (1,653 ) Denominator: Weighted-average common shares outstanding - basic and diluted 36,982 35,406 Net loss per share - basic and diluted $ (0.05 ) $ (0.05 ) |
Schedule of antidilutive securities | Schedule of antidilutive securities Three Months Ended September 30, 2023 2022 (In thousands) Common stock equivalents 667 948 |
Schedule of purchased intangible assets | Schedule of purchased intangible assets September 30, 2023 June 30, 2023 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value (In thousands) Developed technology $ 6,331 $ (4,234 ) $ 2,097 $ 6,331 $ (3,881 ) $ 2,450 Customer relationships 17,528 (10,444 ) 7,084 17,528 (9,487 ) 8,041 Trademark and trade name 1,425 (1,425 ) – 1,425 (1,351 ) 74 $ 25,284 $ (16,103 ) $ 9,181 $ 25,284 $ (14,719 ) $ 10,565 |
Schedule of future estimated amortization expense | Schedule of future estimated amortization expense Years Ending June 30, (In thousands) 2024 (remainder) $ 3,930 2025 3,685 2026 1,177 2027 326 2028 63 Total $ 9,181 |
Schedule of severance and related charges | Schedule of severance and related charges Three Months Ended September 30, 2023 (In thousands) Beginning balance $ 97 Charges 20 Payments (101 ) Ending balance $ 16 |
Schedule of non-cash investing transactions | Schedule of non-cash investing transactions Three Months Ended September 30, 2023 2022 (In thousands) Accrued property and equipment paid for in the subsequent period $ 339 $ 589 |
Warranty Reserve (Tables)
Warranty Reserve (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Guarantees and Product Warranties [Abstract] | |
Schedule of warranty reserve | Schedule of warranty reserve Three Months Ended Year Ended September 30, June 30, 2023 2023 (In thousands) Beginning balance $ 788 $ 594 Charged to cost of revenue 59 352 Usage (40 ) (158 ) Ending balance $ 807 $ 788 |
Bank Loan Agreements (Tables)
Bank Loan Agreements (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Summary of outstanding debt | Summary of outstanding debt September 30, June 30, 2023 2023 (In thousands) Outstanding borrowings on term loan $ 18,675 $ 19,194 Less: Unamortized debt issuance costs (202 ) (230 ) Net Carrying amount of debt 18,473 18,964 Less: Current portion (3,002 ) (2,743 ) Non-current portion $ 15,471 $ 16,221 Outstanding borrowings on revolving credit facility $ – $ – |
Stockholders_ Equity (Tables)
Stockholders’ Equity (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Schedule of option activity | Schedule of option activity Weighted- Average Number of Exercise Price Shares per Share (In thousands) Balance of options outstanding at June 30, 2023 1,325 $ 3.65 Expired (489 ) 4.00 Exercised (133 ) 1.68 Balance of options outstanding at September 30, 2023 703 $ 3.79 |
Schedule of RSU activity | Schedule of RSU activity Weighted- Average Grant Date Number of Fair Value Shares per Share (In thousands) Balance of RSUs outstanding at June 30, 2023 1,189 $ 5.70 Granted 90 4.19 Forfeited (26 ) 5.65 Vested (244 ) 5.79 Balance of RSUs outstanding at September 30, 2023 1,009 $ 5.55 |
Schedule of PSU activity | Schedule of PSU activity Number of Shares (In thousands) Balance of PSUs outstanding at June 30, 2023 931 Granted 689 Forfeited (346 ) Vested (174 ) Balance of PSUs outstanding at September 30, 2023 1,100 |
Schedule of ESPP activity | Schedule of ESPP activity Number of Shares (In thousands) Shares available for issuance at June 30, 2023 381 Shares issued – Shares available for issuance at September 30, 2023 381 |
Schedule of share-based compensation expense | Schedule of share-based compensation expense Three Months Ended September 30, 2023 2022 (In thousands) Cost of revenue $ 41 $ 51 Selling, general and administrative 1,273 1,405 Research and development 428 332 Total share-based compensation expense $ 1,742 $ 1,788 |
Schedule of unrecognized share-based compensation expense | Schedule of unrecognized share-based compensation expense Remaining Remaining Unrecognized Weighted- Compensation Average Years Expense To Recognize (In thousands) Stock options $ 340 2.6 RSUs 5,095 2.0 PSUs 4,095 2.4 Stock purchase rights under ESPP 43 0.1 $ 9,573 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of effective tax rates | Schedule of effective tax rates Three Months Ended September 30, 2023 2022 Effective tax rate 0 3 |
Revenue (Details - Revenues by
Revenue (Details - Revenues by product line) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 33,031 | $ 31,795 |
Embedded IoT Solutions [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 11,373 | 15,095 |
IoT System Solutions [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 19,036 | 14,621 |
Software & Services [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 2,622 | $ 2,079 |
Revenue (Details - Revenue by g
Revenue (Details - Revenue by geography) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Revenues | $ 33,031 | $ 31,795 |
Americas [Member] | ||
Revenues | 22,933 | 20,930 |
EMEA [Member] | ||
Revenues | 6,591 | 5,201 |
Asia Pacific Japan [Member] | ||
Revenues | $ 3,507 | $ 5,664 |
Revenue (Details - Percentage o
Revenue (Details - Percentage of total net revenue) - Revenue Benchmark [Member] - Customer Concentration Risk [Member] | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Product [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk percentage | 93% | 94% |
Service [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk percentage | 7% | 6% |
Revenue (Details - Changes in d
Revenue (Details - Changes in deferred revenue) $ in Thousands | 3 Months Ended |
Sep. 30, 2023 USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Deferred revenue, beginning balance | $ 3,381 |
New performance obligations | 1,598 |
Recognition of revenue from satisfying performance obligations | (1,125) |
Deferred revenue, ending balance | 3,854 |
Less: non-current portion of deferred revenue | (1,086) |
Current portion of deferred revenue | $ 2,768 |
Revenue (Details Narrative)
Revenue (Details Narrative) - Prepaid Sales Commissions [Member] | Sep. 30, 2023 USD ($) |
Prepaid expenses and other current assets | $ 155,000 |
Other assets | $ 47,000 |
Acquisitions (Details-considera
Acquisitions (Details-consideration liability) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Jun. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | ||
Preliminary estimated fair value of earnout consideration at beginning balance | $ 1,271 | $ 1,718 |
Remeasurement estimates | (9) | (447) |
Payments | 0 | |
Preliminary estimated fair value of earnout consideration at ending balance | $ 1,262 | $ 1,271 |
Acquisition (Details Narrative)
Acquisition (Details Narrative) - USD ($) | Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Jun. 30, 2022 |
Preliminary estimated fair value of earnout consideration at ending balance | $ 1,262,000 | $ 1,271,000 | $ 1,718,000 | |
Forecast [Member] | ||||
Preliminary estimated fair value of earnout consideration at ending balance | $ 1,262,000 |
Supplemental Financial Inform_3
Supplemental Financial Information (Details - Inventories) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Finished goods | $ 22,339 | $ 25,670 |
Raw materials | 23,457 | 24,066 |
Inventories | $ 45,796 | $ 49,736 |
Supplemental Financial Inform_4
Supplemental Financial Information (Details - Other liabilities) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued variable consideration | $ 2,139 | $ 2,167 |
Customer deposits and refunds | 21,102 | 16,344 |
Accrued raw materials purchases | 316 | 267 |
Deferred revenue | 2,768 | 2,493 |
Lease liability | 1,942 | 1,859 |
Taxes payable | 393 | 647 |
Warranty reserve | 807 | 788 |
Other accrued operating expenses | 4,595 | 4,248 |
Total other current liabilities | 34,062 | 28,813 |
Non-current | ||
Lease liability | 9,884 | 10,425 |
Deferred tax liability | 215 | 146 |
Deferred revenue | 1,086 | 888 |
Total other non-current liabilities | $ 11,185 | $ 11,459 |
Supplemental Financial Inform_5
Supplemental Financial Information (Details - Net loss per share) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Numerator: | ||
Net loss | $ (1,886) | $ (1,653) |
Denominator: | ||
Weighted-average common shares outstanding - basic | 36,982 | 35,406 |
Weighted-average common shares outstanding - diluted | 36,982 | 35,406 |
Net loss per share - basic | $ (0.05) | $ (0.05) |
Net loss per share - diluted | $ (0.05) | $ (0.05) |
Supplemental Financial Inform_6
Supplemental Financial Information (Details - Equivalents) - shares shares in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Common stock equivalents | 667 | 948 |
Supplemental Financial Inform_7
Supplemental Financial Information (Details - Purchased intangible assets) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 25,284 | $ 25,284 |
Accumulated amortization | (16,103) | (14,719) |
Net book value | 9,181 | 10,565 |
Developed Technology Rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 6,331 | 6,331 |
Accumulated amortization | (4,234) | (3,881) |
Net book value | 2,097 | 2,450 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 17,528 | 17,528 |
Accumulated amortization | (10,444) | (9,487) |
Net book value | 7,084 | 8,041 |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,425 | 1,425 |
Accumulated amortization | (1,425) | (1,351) |
Net book value | $ 0 | $ 74 |
Supplemental Financial Inform_8
Supplemental Financial Information (Details - Amortization expense) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
2024 (remainder) | $ 3,930 | |
2025 | 3,685 | |
2026 | 1,177 | |
2027 | 326 | |
2028 | 63 | |
Total | $ 9,181 | $ 10,565 |
Supplemental Financial Inform_9
Supplemental Financial Information (Details - Severance of related charges) $ in Thousands | 3 Months Ended |
Sep. 30, 2023 USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Beginning balance | $ 97 |
Charges | 20 |
Payments | (101) |
Ending balance | $ 16 |
Supplemental Financial Infor_10
Supplemental Financial Information (Details - Non-cash acquisition) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued property and equipment paid for in the subsequent period | $ 339 | $ 589 |
Supplemental Financial Infor_11
Supplemental Financial Information (Details Narrative) - USD ($) | 3 Months Ended | ||
Dec. 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
Severance charges | $ 20,000 | $ 92,000 | |
Forecast [Member] | |||
Severance charges | $ 500,000 |
Warranty Reserve (Details)
Warranty Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Jun. 30, 2023 | |
Guarantees and Product Warranties [Abstract] | ||
Beginning balance | $ 788 | $ 594 |
Charged to cost of revenue | 59 | 352 |
Usage | (40) | (158) |
Ending balance | $ 807 | $ 788 |
Bank Loan Agreements (Details -
Bank Loan Agreements (Details - Summarizes our outstanding debt) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Debt Disclosure [Abstract] | ||
Outstanding borrowings on term loan | $ 18,675 | $ 19,194 |
Less: Unamortized debt issuance costs | (202) | (230) |
Net Carrying amount of debt | 18,473 | 18,964 |
Less: Current portion | (3,002) | (2,743) |
Non-current portion | 15,471 | 16,221 |
Outstanding borrowings on revolving credit facility | $ 0 | $ 0 |
Bank Loan Agreements (Details N
Bank Loan Agreements (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended |
Sep. 30, 2022 | Sep. 30, 2023 | |
Senior Creditand Mezzanine Credit Facilities [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit description | minimum liquidity of $4,000,000 at SVB, as measured at the end of each month. | |
Third Amendment [Member] | Silicon Valley Bank [Member] | ||
Debt Instrument [Line Items] | ||
Term loan | $ 5,000,000 | |
Maturity date | Aug. 02, 2025 | |
Minimum liquidity requirement | $ 4,000,000 | |
Nonrefundable facility increase fee | $ 25,000 | |
Credit Facilities [Member] | ||
Debt Instrument [Line Items] | ||
Interest expense | $ 450,000 |
Stockholders Equity (Details -
Stockholders Equity (Details - Option activity) - Options Held [Member] shares in Thousands | 3 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of shares options outstanding at beginning | shares | 1,325 |
Weighted average exercise price options outstanding at beginning | $ / shares | $ 3.65 |
Number of shares options expired | shares | (489) |
Weighted average exercise price options expired | $ / shares | $ 4 |
Number of shares options exercised | shares | (133) |
Weighted average exercise price options exercised | $ / shares | $ 1.68 |
Number of shares options outstanding at ending | shares | 703 |
Weighted average exercise price options outstanding at ending | $ / shares | $ 3.79 |
Stockholders Equity (Details _2
Stockholders Equity (Details - RSU activity) - Restricted Stock Units (RSUs) [Member] shares in Thousands | 3 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of shares outstanding, beginning balance | shares | 1,189 |
Weighted average grant date fair value per share outstanding at beginning | $ / shares | $ 5.70 |
Number of shares granted | shares | 90 |
Weighted average grant date fair value per share granted | $ / shares | $ 4.19 |
Number of shares forfeited | shares | (26) |
Weighted average grant date fair value per share forfeited | $ / shares | $ 5.65 |
Number of shares vested | shares | (244) |
Weighted average grant date fair value per share vested | $ / shares | $ 5.79 |
Number of shares outstanding, ending balance | shares | 1,009 |
Weighted average grant date fair value per share outstanding at ending | $ / shares | $ 5.55 |
Stockholders Equity (Details _3
Stockholders Equity (Details - PSU activity) - Performance Stock Units [Member] shares in Thousands | 3 Months Ended |
Sep. 30, 2023 shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of shares outstanding, beginning balance | 931 |
Number of shares granted | 689 |
Number of shares forfeited | (346) |
Number of shares vested | (174) |
Number of shares outstanding, ending balance | 1,100 |
Stockholders Equity (Details _4
Stockholders Equity (Details - ESPP activity) - Employee Stock Purchase Plan [Member] shares in Thousands | 3 Months Ended |
Sep. 30, 2023 shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Shares avilable for beginning | 381 |
Shares issued | 0 |
Shares avilable for ending | 381 |
Stockholders Equity (Details _5
Stockholders Equity (Details - Share based compensation) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Total share-based compensation | $ 1,742 | $ 1,788 |
Cost of Sales [Member] | ||
Total share-based compensation | 41 | 51 |
Selling, General and Administrative Expenses [Member] | ||
Total share-based compensation | 1,273 | 1,405 |
Research and Development Expense [Member] | ||
Total share-based compensation | $ 428 | $ 332 |
Stockholders Equity (Details _6
Stockholders Equity (Details - Unrecognized expense) $ in Thousands | 3 Months Ended |
Sep. 30, 2023 USD ($) | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unrecognized share-based compensation expense | $ 9,573 |
Stock Options [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unrecognized share-based compensation expense | $ 340 |
Weighted average years to recognize | 2 years 7 months 6 days |
Restricted Stock Units (RSUs) [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unrecognized share-based compensation expense | $ 5,095 |
Weighted average years to recognize | 2 years |
Performance Stock Units [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unrecognized share-based compensation expense | $ 4,095 |
Weighted average years to recognize | 2 years 4 months 24 days |
Employee Stock Purchase Plan [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unrecognized share-based compensation expense | $ 43 |
Weighted average years to recognize | 1 month 6 days |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 0% | 3% |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | Sep. 30, 2023 | Jun. 30, 2023 |
Income Tax Disclosure [Abstract] | ||
Net deferred tax liability | $ 215,000 | $ 146,000 |