- Earnings call transcript Q3 2022

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Operator

Good morning, and welcome to the Minim Third Quarter 2022 Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to James Carbonara of Investor Relations. ahead. go Please

James Carbonara

to on Welcome Officer; XXXX call. earnings Dustin Thank call Minim's are me Officer. the Chief Executive Mehul With Tacker, you. Financial QX Patel, and Chief

live a presentation Investor As website ir.minim.com. at materials all for Relations are on the reminder, available company's today's

may begin, to call we statements. that today's remind Before forward-looking everyone I conference want contain

by results statements these from and future expenses include operating revenue, margins, differ statements Forward-looking statements. materially outlook. forward-looking regarding or Actual expected those could the contemplated future, including trends business

Securities a of such the is risks or as company's the well non-GAAP time For actual as the the our on with Form statements, detailed uncertainties, results our that include the reports note, Please on other company contained expressed files in may comparable from numbers utilizes time report factors the please XX-K with in analyze reports and call press recent Form as those management most in periodic in cause XX-Q discussion annual filed to that which the see risk as to non-GAAP in could well Exchange differ implied company's today's forward-looking measure from in of GAAP such and that most A SEC. reconciliation to of too, use available to Commission. release numbers filings performance. the subsequent

the to Patel, Mehul turn over CEO Mehul call like to please Minim. Now proceed. I would of

Mehul Patel

Minim's morning, QX to conference and Good welcome Thanks, James. XXXX call.

Day with channels. XX% off from with is Prime quarter which up in by year October Day X% started to Prime Amazon July, third compared QX of Our was boosted We and XXXX. our Revenue $XX.X Day. revenue QX up success million, was Amazon e-commerce continued prior Prime

approximately gross Our from for July. this Day performance were XX% of Prime event our sales

appears when see despite sold shopping between October early was in start XX. was to a to across efforts categories other November. for items to July the with consumer holiday Amazon, online summer continue Across but over Pricing purchases more the be hoped we XX concerns October. than access had products event although seek season were as turn down July to for to of preference to markets, aggressive the and Prime more we retailers' product this sales, remains holiday performance retailers, purchasing traditional Prime during Days season and start inflation lighter jump XXX shopping our to million as this competitors consumer compared best in inventory. delaying Our were consistent Xx ahead According sold this

position, Regarding product our a levels focusing ended with that selection rather our we than purchasing of plans fourth carried inventory and momentum to end cash from inventory, million in million $XX.X and $XX.X quarter. inventory ones. down to recover QX. small at return execute QX items program continue we purchase of new our importantly, by We to reduce into And

million and We to as low-XXs exit reduce of range XXXX million a further we exit as inventories QX into we to to $XX reduce expect $XX even to QX.

of compares to $XX of the June the end of the million. used outstanding of as in quarter credit. of quarter a Cash was payable the the the of This million, third of drawdown of during quarter. XXXX. end $X.X to which million outstanding $X.X million reduce second line quarter of as We $X.X quarter was company's to at end with ended debt primarily XX% XX, balance our nearly cash debt Our million million $XX.X by as $X.X from accounts was

As of XXXX, had the September credit in XX, million of we availability $X.X line.

year-end, end reducing to cash in cash, by million from our $X.X into $X of maintenance our and cash $X minus ending million we anticipate plus to to or reduce million the to balance. payable inventories level be September a to continue expect balance As accounts them further we XXXX. range we Heading convert balanced

continues. intelligent We're product launch stack software-enabled compete in will to enable effectively mobile map streams software road to business cash new commitment a advancing offering Our us revenue side on our that develop to whole product and flow. of industry more the the and of consumer

recently charge purchases. include network provides this of business plan plan for wind Congruent by also which to Our We currently ISP free fully the offering of and management, protection strategy, down customers controls. unlimited support, with and and our support premium threat diagnostics for business, parental of the exit November XXXX. we with announced

Office for channel which sell Newegg our also and of of planned channels price products such bundled at QX. as DOCSIS opportunities across X.X to our provide and announced first Depot, Lenovo world factor products that performance. the accelerating agreements further our QXX a quarter Furthermore, PCs discussions Both home to our outstanding and class our will as e-commerce with in with in recently help our networking pair all higher paired performers to in entertainment X. technologies in to our mesh products, price. new products, app the and Motorola customers on its Lenovo.com with top our Motorola Lastly, come successfully end, include the offering The now Subsequent placements include XXXX. advanced motosync our its ability signed footprint offers is growth. retailers. app growth with Staples deep third quarter home for starting WiFi a that improvement we feature launched achieve e-commerce our larger average to We're will We mobile showcase selling now point, WiFi to QXX, raise expansion cutting-edge Motorola further Lenovo.com. products products and XE

high-quality entries. for announced and Finalists of in hundreds communication strategies an are next-generation the be achievements week. Light run Use companies and the finalist Applications, XXXX industry's expected Customer selective category their executives Reading was top Leading Communication to The The Case, recognizes and Industry the of Minim recognize Lights. Global their from will technology. innovations. award by Outstanding Experience We Reading. program outstanding next services Light Award

revenue Looking ahead, and industry streams in capital, confident are I'm challenging, on executing channels. allocation and our doubt create is our but we distribution our execute product to macro it. to expanding the of of focused our the strategy new road on environment prudent team No map

review to Now of financial Dustin? results. for Dustin I'll turn a our

Dustin Tacker

Thank you, the at Mehul. A on friendly reminder depicted presentation site been has in financials earnings posted Relations that the will ir.minim.com. are cover that our Investor I

X% the revenue prior $X.X over $XX.X net is million quarter. for the prior from in Our million, revenue the increased the quarter per which and quarter $X.X million up totaled to

continued the Day success sales e-commerce net quarter Prime from our Amazon third channel. Our benefited with July in and

margin XX.X%, from in the up prior our was quarter, the XX.X% quarter. For gross

Excluding despite continues cost impact from the our inflation to margin onetime costs, gross component approach and increases. XX% negative

for and the million negative diluted This of or diluted basic Our compares QX in net negative XXXX, XXXX. share. $X.XX $X.XX with a share net per loss or and million $X.X per second $X.X basic loss was of quarter

of quarter, quarter. million the the our For was negative prior adjusted EBITDA negative adjusted to $X.X $X.X compared in EBITDA million

$X.X the to look end million million quarter-over-quarter cash quarter. of quarter. million basis compared was decreased for of accounts the on quarter, the end $XX.X in at of cash a a at accrued expenses. million $X.X $X.X and the The of second cash the to decrease sheet. by close down the At of quarter to prior Inventories driven paying decrease at payable equivalents and a balance compared the in Now the million, had we largely $XX.X

outstanding monitor We of line the million year. as continue drawdown reduce company's $X.X ended closely to levels to levels We compares the debt in the X $XX debt XX, production credit, to per our with June quarter at $X.X inventory with focus which and X a million, this with was million of inventory of outstanding XXXX. turns on

XXXX, on had the credit availability in $X.X September we line. million of As XX,

Lastly, a XXX-day comply on from received with price the October of XX, bid NASDAQ XXXX, extension to requirement $X. minimum we

can and monitor open questions. the requirements continue my our the expiration. financial to XX, that, to like With secure listing We line operator, April before to I'd concludes the consider options for stock That XXXX, remarks. price

Operator

you. Thank

go David Today's Private now [Operator begin ahead session. the from will question We comes [ph], question-and-answer Investor. Tokos Instructions] Please first

Unidentified Analyst

for revenue calls. everybody. major individual are I do lack morning, I I the I'm update. good it. in own cash I know – do I've appreciate as that a And future you've My of – of could consider out consider little curious Thanks every gotten party – the why going initiatives all to bleed I'm light shares. concerns know I'm taken, I'm time would would pay pop these quarter project reverse down the which did you Hi, those concerning. worried to run I'm so that all And of a that's this lot a investor. you're some you of of a how kind an that growth on investor, cash, you then an kind a that. financially. I than payables. be crushed have been split, to curious less of quarter? terrified about next to to the so

So time. that that do an lost not I'm hopeful every you'll is I've because option

So Thank if would address guys you I could be you. those, grateful.

Mehul Patel

take Dustin, that? want to you do

Dustin Tacker

concerns from. David. know coming your I morning, Good you're appreciate Yes. we Understandably, there. where

first revenue company, a as So question. address obviously, I your guess, growth

we customers, We are takes to – start we expect generate we but some obviously, contracts ramp the – new time generating new negotiating it up do customers. announced, same path, more XXXX. with sales to and continuously go Those have been we the at then substantial it as stream as that with we're into don't have another that. was customers revenue those looking then revenues And too, time,

a – don't still how to bid. place, think obsolescent. cash, let's we we so provide hand. think viable that's sheet, still if to about have will company do you So license and Two, our model. at about is pivot, Today, product the more as subject around design our balance model recurring on as go provide we that That valuable software we talked right. in as inventory $XX I million that we obviously, the have that of – look is you – do will That as the say, how inventory we subscription cash, additional revenue, to the we we strategy

amounts continue We're we in initially some had had going that done bleed down to – inventory. inventory We as prior be not the year. buying will to large of

So the start base. finance stream have we And That – then the cash, inventory new we as to get to XXXX, revenue converting now will we the will in be We cash. into balance. our as cash well to that company customer new supplemental as the generating help itself.

Mehul Patel

Yes.

jump on I'll David, that in so well. So

what trying to So good expansion on question revenue – we're just the and do.

excellent on has sales the job our around e-com channel. So an sides. from team done X top our side is One

happen for We brick-and-mortar side, for you've side, every continue categories got started the Amazon that in #X also which is. continue to one retail a we market doesn't the from remember, that to It to other on to a it is excel matter retailer. have our places share And be and cyclical invest. there things from

winning spring it call So new there's anywhere X take months on and a channel, reset. does a a X is earliest also to between

have So once next – wait you miss one, you to cycle. for you the

So at doing around this in opportunities that's X as know making sure But going we our mentioned, that resources thing. going and point that are to to next to it's great Dustin that aligned on more the solutions expand forward. or year. things growth we the have us into different And we're locked consumer X one allow that

we're just to our of where allow enable we're to a provide do that want the versus down start over to us and to on of minutes support, some that today, few leveraging more more monetize doing our – services mentioned we we the continue a allocate that. wind software resources not ISP to As us higher call to be to ago to resources trying

we have alone, X that allows don't to our grow those us between today. sales So channels

mentioned, the million to only inventory $XX we've that there is you of of even around team additional limitation NTI I for continue the burn, number have. be Board. question The to there's as burn sure is What buying going or focus we the Dustin that and and doing other that's on the we, make that had purchases, on down purchases course, and one call, to high a myself of cash no a products executive volume been

should we QX, even a to focus less to cash the we mentioned and from of be and that continue been that additional that's purchase going that so as that possible. further. that XX% burn get down range expect in also think so into – from And mid-XXs, to should in as continue to generation I the I be XX%,

AP maintain into to continue cash. So that inventory and turn

The question in think Board did stock as I has next of that goal around So to so. confident and pretty year. to Dustin be reverse out hand. April split. make the go we sure the your in mentioned, that's third execution to our from feel And We our going the we team do to extension, get #X options

at and terms continue standpoint to the in going is well advance forward we're those So Board any announce to in a then, options. now and definitely options we'll those look from with to what move between decision of of

Unidentified Analyst

the of you. about, bolster upbeat is. the talk picking the went senior don't maybe, shares if also lesser the even investment, One, million some float but suspect stock to why price of price to or remember is but where price XX I so And $X.XX $X.XX – $X.XX. know, take, exactly James the thought it thought in is upbeat an management be I Thank outstanding, have stocks, so driven about you. million in did thing, to was traded today I with know matters. if float where I a all but algorithm company the about question last all give stock about there initiate for because Thank many thought you are $X.XX, couple minus that's it, And million all not I because an day what expert a James considering up, if of own all so I I know gets I not the future, be is if the so low, but $X.XX, stock right sure stock or company as that? there's you number shares would And last I'm I'm price I was doesn't the investments their – don't in you $X.XX to shares lack think, you XX all a the float you are and around anybody not in traded on I'm maybe price then or the Board bought it's don't plus the days, to if company's honest. the purchases or why how $XX the

curious looms, and in else inventory, or drop or price another And so, driving with I I like that that – of to mean, April of deadline your I if don't probably the also kind in profitability. trading thoughts fact be remember matter. key so to think to but had the day, next make months, with months the on way, I last that's it would was if – know that I'm the the that kind you but hopefully, other stock you're managing there I you're on sounds of are will two kind the or is buy So buy curious price. six that anybody with that any thought six extensions the the cash low, quarter dropping the SEC can

Mehul Patel

Yes.

good So question.

of legal conversation. the yes, So of like Board – first has front some in been on the foremost, the and investment I and said, options discussions

you you're few myself looking few conversations well as those had it, Board in well, when are have into as can't in ourselves, as invest it members a we So Dustin with senior but along a and really members. we a other blackout,

you'll few see something what hopefully and next the So we months do. around, in turn can see

Again, The other – other to see portion the we ago. say, extension. we an to had on an extension have We're is. want the weeks executed the you other what of options I around was of extension, looking that question X the just

next on going right enough go we with the what have in those and to to have now, review we to NASDAQ. options see we're for I But now. So decide play continue the that conversation think

Unidentified Analyst

great. Okay,

Mehul Patel

Dave. Thanks,

Operator

The Investor. Please Grohl Private question ahead. go [ph], a from David comes next

Unidentified Analyst

morning. Good Yes, hi.

Mehul Patel

morning. Good

Unidentified Analyst

can say that I the for concerns want my his to company's consultant happening great totally coincidentally, X success? I'm frame forward just of see – number usually I that, I that mean, it years think And future, it. X-day with for incredible management. has other what in companies, What company the that tell And you in company, years now And be development do get I the would were who the plan time? the with that shareholder would question. the standing that I've questions. the I at a from lead to and and my That's organization with with have David, led it share happening? they And to question you X be X happened been X- a if and I the of tactical answer also many wondering, And company. that and I that off the success. look asked you If will the I what days years, to so for me shares to when is, take start great were retreat just the X question. achieved an First, over

I So not so. But look do the be it's to on Minim? putting do might you to I where as you know out spot, and see future, the you my intention

Mehul Patel

question. Yes. No, great

asked time look, not that it's question. first not So being the I'm

I and bit I this being taking before my was many want in for you right, longer ago we're the I no company this was. is that what to CFO and which where X months Technologies this Zoom at me something from where this Minim to So it CEO background company is do business, and focus years, joined on from asked just where which come business, times. continues – several coming from the the industry And business, to be – point this from, there hardware acquisition this in this and a over, attracted my little yourself I see roll, say, was

with in we household every into we serve. the get have to us household that allows that every heartbeat something are We that

didn't manage revenue because that above integrated onto that software is all development me, back play as we that a our to have right hardware allowed So – just And to mentioned in software not nominal right and sale, what deal at it's consumer, able now, make stops. and they end their August, and the of we with now secure, generation go it them do to to have them play, lifetime But throughout access we easy our which build that with you fee, we show customer we're household household and them make weren't allows us software to devices, use have the a value in on to and that, we having be we provide into today. feel when can relationship now, our with and top that sure and them before. hardware their our charging

So early – we see been that's call you'll that, second that's we're in going our the that year something some even to things revenue of next – have are goal the into get generate the into mentioned second probably and that of on to quarter year, stream half as we a as that allow and today. and those reoccurring don't us going executed

be? percentage what one That's Now of that will thing.

offer one that's things certain to our have allows full allow out competitors a price allows it. solution that make We growth compete sell will competitive. us but it to offer part don't So want and to that there free, which We today, right? feature have all with a to us solutions put we and of path, robust similar us the we

So thing. that's one

market. are in not in today, other other retail we're market any The we part a is dominantly

get that companies right be places and want really grow into a don't that started in a I challenge grow definitely to So have next it's in conversations place allows today. in that not really year. we're but good don't that allows have into that's areas going now, to we with We going to in already us us folks And footprint to to today.

place. We're part in second where it. product any can it, the other of today we going countries of be in that's anywhere this the take to that's of and next scale our So not and evolution

an years we're just how So today. successful that opportunities should there are be scale and go X margin allows products it that investment able and doesn't may other gross are execute what X, investment areas beyond now places – not being in where above down, we're the chase what us to in our get doing from can and just to today, in we to and be out us we're in a you review an same see, different grow as we see country right region it today see now nowhere U.S., Latin because in be and down. there generate that the the take allows to for Europe, go won't products And than we're time, with at America. and the nowhere can or we in chase dollars mean rather it we investment Asia

allows opportunities So we to to it business see footprint that and us review those have possibility there's and today. our cases and if a build go don't

us regions channels different just grow software, to So as we're us hardware the allows product in distribution into grow into to you can with see, globe, the U.S.-based a allows across grow allows different to well. us as portfolios

same see the have and and pretty to and And strategy massive I'll there's execute shot does out and Dustin team. out. have that the opportunities attracted show on got start confident have just the that me play that and and myself growth over our – quarters, and here they the we team next focus to we first you'll few and the I'm So continue executive focus, us, all that when that so to laid

Unidentified Analyst

and whether hopeful. the sold distribution actually Okay. it world remember of were any I my I they hoped or sounds occurring. they the slide I remain if the remember Well, to just showed company I don't And mention, And was And want were channels that Zoom haven't around when time. shares. for great. at a I

the whatever I to those? occurring think were And them many of actually around happened world.

Mehul Patel

Yes.

I'd you and together, that see go and step at with happy was if see a and have it that love I'll love back that have So look go separate why to David, happens. – in But if and and a I back more can and to little be merged James to you look I'd than can I I that's Minim at what – wish you see Zoom get point. me of tell get call to I they I time, an can guess, at you answer. But bit

Unidentified Analyst

the vision, about Question you...

Mehul Patel

I'm broke there. I sorry, out

Unidentified Analyst

for Thanks question. my taking

Mehul Patel

No worries. well. as – being you. Thanks again, for a long-term for Thank thanks investor

Unidentified Analyst

Okay.

Operator

question GTM. with ahead. from next go comes [indiscernible] The Please

Unidentified Analyst

congratulate Hello, guys work your there. very there. to call in taking all Thank on want you hard know over competitive for you my I and I you're a marketplace.

Just I a few questions. some on can Hopefully, have them. clarity you simple give

The use with Could first one I is what the royalty a color that relationship every And with you I their bit give to going guys more to how that? XXXX it you Motorola. it has our year. have a with And to you your little them know I relationship a on on believe name. after have is royalty paid – And expect be give know do contract what them expires you forward? them? to in XXXX.

Mehul Patel

Dustin, do take you to that? want

Dustin Tacker

Sure.

about that. correct You're

can with to So level, agreement succeeded Motorola. the that contract, will great do that as name expectations. royalty we royalty Motorola as healthy. relationship agreement we goes value their of we for then feel have rate. with through a that had The December expect been We've introduce give it renew certain too, comes. other us very get expand great provides that But been that and we have again, initiatives, value. them our try And market, we more incremental minimum royalty We we feel revenue more even once the that payment. us to time itself the into do start a XXXX. that well we'll We our relationship to we a And product to today paying expect structure has obviously, a extend when we and that has

Unidentified Analyst

Great.

now far like out I I for same protection can protection. our there's couple I stands patent mean them had price. there see far prices, as your you there can as out is applied pending. you going certain question your quick it of as is model do you different forward gone what it generic modem. comparing price, the I patents. obviously, X you modems, right marketplace? same the seems you I you guys see. Amazon, Another have as less in How know more everyone with noticed guys feel as has patent the know a guys, of Because everything have we

Mehul Patel

Yes.

don't that continue And I we're on what is and into to our technologies. to if are to doing continue aggressively evolve stopping we some today. do different technology. see patents have pretty that is we we apply So there develop – to based And

– our we just doing also which about. worried software developing be patents, is patents As things it hardware won't play. software, a we're key We're that around

of just side is along mostly with the not side, those with world hardware maybe is the side. and review make as for patents don't to is no competitors. sure to It's well, as of or aggressively some the who hardware patents there have So the products. there our we software if go which continue what hardware, patents to you see invent lot we a our next-gen But goal is file

Operator

Please The ahead. next [indiscernible]. question from go comes

Unidentified Analyst

there's morning, morning. I I you XX-Q Hi, out My good if is, was Thank call. my haven't and auditors? from seen any question concern a the this going for taking wondering,

Dustin Tacker

Monday. file to plan on we So that

but the timing at Valley itself now, we some the line the where going at the just is our you if position into through finalize going from will document. have we have it's balance and of now, just filing it's given expires go type concern we're less Bank period language our And X to so that year, look couple right measurement concern of put internal a itself. XX order itself, Silicon will sheet just data decent than months. before – XX reviews we Yes, because of filing, looked right So next going November of months the of to the at a a XX-Q

Bank same breaking However, that for the line. terms working to to too, the time, of through negotiations of Valley kind at Silicon extend we're certainly

being to don't sometime matter next or we year. once we expect concern the of publicized release in that our XX-K see So going that XX-K in QX

Unidentified Analyst

Bank as you that on credit? have line hand, inventory a they're what your is consideration of in holding that

Dustin Tacker

a both receivable of Yes, and inventory. accounts portion our

Unidentified Analyst

my… And Okay. then

Mehul Patel

is, early the it of as portion some or have that well and confident will it's XXX%, the Dustin place the extension before quarter. I not in it's Yes, get said,

Unidentified Analyst

is, router? or then some And your have of type question diversifying second portfolio Okay. my bitcoin maybe ever getting considered into you

Mehul Patel

I'll Look, that. take

a that's good hot. So team sure on focused is want where that executing our which map which make question. our the we our hardware and strategy We software, But at we role on to continue the we I are, about X map along to want out, given products allow was sure laid thought when road solution. step to one will company roll this it market I with out any have revenue full said we make we sure can a road for to the have have us once that is us as point opportunities to at now. reoccurring but other point, the sure make make road on whole. we we'll at look be roll that how key map the the we the that's full And we not our to out will grow right solution be to to the And

Operator

I Patel would the question-and-answer turn closing for any like remarks. Mehul over to conference the back concludes This session. to

Mehul Patel

grow senior looking continue us can company. faith and for forward and and the can the that the Thanks the company the and execute next. we on even execute to in from long-term team to we're this I you, investors short-term believing investors questions first take to the how we and Minim, again. showing for between And to all can Thank show it to you all you myself, in tell and goal investors and where the for all half Dustin for is on

up everybody talk soon. So for holidays, thank coming support we'll all wish you a Thanksgiving and and and your again happy

Operator

attending you now The conference for presentation. concluded. has today's Thank

disconnect. now may You

Minim (MINM) 12 Nov 222022 Q3 Earnings call transcript