EX-99.1 2 ea023081101ex99-1_kornit.htm PRESS RELEASE, DATED FEBRUARY 12, 2025, TITLED "KORNIT DIGITAL REPORTS FOURTH QUARTER AND FULL YEAR 2024 RESULTS"

Exhibit 99.1

 

Investor Contact:

 

Jared Maymon

Global Head of Investor Relations

Jared.Maymon@Kornit.com

 

 

Kornit Digital Reports Fourth Quarter and Full Year 2024 Results

 

●Fourth quarter revenues of $60.7 million, in line with previous guidance

 

●Fourth quarter GAAP net income of $2.2 million; non-GAAP net income of $8.7 million

 

●Successfully delivered positive EBITDA and strong cash flow from operating activities in both Q4 and for the full year 2024

 

●Breakthrough innovations and continued momentum across our markets set the stage for profitable growth in 2025

 

Rosh-Ha’Ayin, Israel – February 12, 2024 – Kornit Digital Ltd. (“Kornit” or the “Company”) (Nasdaq: KRNT), a global leader in sustainable, on-demand, digital fashion and textile production technologies, today reported its results for the fourth quarter and full year ended December 31, 2024.

 

“Our fourth quarter performance was fueled by a successful peak season and growing impressions across our key customers,” said Ronen Samuel, Kornit’s Chief Executive Officer. “One of the most exciting highlights of Q4 was the Apollo platform’s performance. Having delivered 15 Apollo systems throughout the year, with most becoming fully operational during this critical period, customer feedback has been excellent, reinforcing Apollo’s role as a key enabler of mass-scale digital production.”

 

Mr. Samuel continued that “at the beginning of 2024, we set clear objectives: return to positive EBITDA, generate meaningful cash flow, and establish a scalable, disciplined model that fuels long-term expansion. Thanks to the dedicated efforts of our teams, I am pleased to report that we not only delivered on these goals but also introduced game-changing innovations, strengthened our market position, and expanded into new strategic adjacencies.”.

 

Mr. Samuel concluded, “As we stated in our last call, 2025 is about execution—translating the strong foundation built in 2024 into scalable, profitable growth, strengthening our market leadership and driving the industry forward with our innovative solutions and business models.”

 

 

 

 

Fourth Quarter 2024 Results of Operations

 

●Total revenue for the fourth quarter of 2024 was $60.7 million compared with $56.6 million in the prior year period, due primarily to growth in products revenue.

 

●GAAP gross profit margin for the fourth quarter of 2024 was 51.3% compared with 25.8% in the prior year period. On a non-GAAP basis, gross profit margin was 55.1% compared with 48.6% in the prior year period.

 

●GAAP operating expenses for the fourth quarter of 2024 were $32.3 million compared with $42.4 million in the prior year period. On a non-GAAP basis, operating expenses decreased by 6.9% to $28.0 million compared with the prior year period.

 

●GAAP net income for the fourth quarter of 2024 was $2.2 million, or $0.05 basic and diluted per share, compared with net loss of $22.9 million, or ($0.48) basic and diluted per share, for the fourth quarter of 2023.

 

●Non-GAAP net income for the fourth quarter of 2024 was $8.7 million, or $0.18 basic and diluted per share, compared with non-GAAP net income of $3.8 million, or $0.08 per basic share, for the fourth quarter of 2023.

 

●Adjusted EBITDA for the fourth quarter of 2024 was $8.4 million compared with adjusted EBITDA of $0.2 million for the fourth quarter of 2023. Adjusted EBITDA margin for the fourth quarter of 2024 was 13.8% compared with 0.3% for the fourth quarter of 2023.

 

Full Year 2024 Results of Operations

 

●Total revenue for the full year 2024 was $203.8 million compared with $219.8 million in the prior year, due primarily to lower systems revenue.

 

●GAAP gross profit margin for the full year 2024 was 45.0% compared with 30.5% in the prior year. On a non-GAAP basis, gross profit margin was 48.6% compared with 38.4% in the prior year.

 

●GAAP operating expenses for the full year 2024 were $129.1 million compared with $154.5 million in the prior year. On a non-GAAP basis, operating expenses decreased by 14.0% to $109.8 million compared with the prior year.

 

●GAAP net loss for the full year 2024 was $16.8 million, or ($0.35) basic and diluted per share, compared with net loss of $64.4 million, or ($1.31) basic and diluted per share, for the full year 2023.

 

●Non-GAAP net income for the full year 2024 was $10.1 million, or non-GAAP basic and diluted net income per share was $0.21 and $0.20, respectively, compared with non-GAAP net loss of $20.4 million, or ($0.42) basic and diluted per share, for the full year 2023.

 

●Adjusted EBITDA for the full year 2024 was $0.3 million compared with adjusted EBITDA loss of $30.9 million for the full year 2023. Adjusted EBITDA margin for the full year 2024 was 0.2% compared with –14.0% for the full year 2023.

 

First Quarter 2025 Guidance

 

For the first quarter of 2025, the Company expects revenues to be in the range of $45.5 million to $49.5 million and adjusted EBITDA margin between –9% to –4% of revenue.

 

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Fourth Quarter and Full Year 2024 Earnings Conference Call Information

 

The Company will host a conference call today at 8:30 a.m. ET, or 3:30 p.m. Israel time, to discuss the results, followed by a question-and-answer session with the investor community.

 

A live webcast of the call can be accessed at ir.kornit.com. To access the call, participants may dial toll-free at 1-877-407-0792 or 1-201-689-8263. The toll-free Israeli number is 1 809 406 247.

 

To listen to a replay of the conference call, dial toll-free 1-844-512-2921 or 1-412-317-6671 and enter confirmation code 13751316. The telephone replay will be available approximately three hours after the completion of the live call until 11:59 pm ET on February 26, 2025. The call will also be available for replay via the webcast link on Kornit’s Investor Relations website.

 

About Kornit Digital

 

Kornit Digital (NASDAQ: KRNT) is a worldwide market leader in sustainable, on-demand, digital fashion, and textile production technologies. The company offers end-to-end solutions including digital printing systems, inks, consumables, software, and fulfillment services through its global fulfillment network. Headquartered in Israel with offices in the USA, Europe, and Asia Pacific, Kornit Digital serves customers in more than 100 countries and states worldwide. To learn more about how Kornit Digital is boldly transforming the world of fashion and textiles, visit www.kornit.com.

 

Forward Looking Statements

 

Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. securities laws. Forward-looking statements are characterized by the use of forward-looking terminology such as “will,” “expects,” “anticipates,” “continue,” “believes,” “should,” “intended,” “guidance,” “preliminary,” “future,” “planned,” or other words. These forward-looking statements include, but are not limited to, statements relating to the Company’s objectives, plans and strategies, statements of preliminary or projected results of operations or of financial condition and all statements that address activities, events, or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. The Company has based these forward-looking statements on assumptions and assessments made by its management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Important factors that could cause actual results, developments and business decisions to differ materially from those anticipated in these forward-looking statements include, among other things: the duration and severity of adverse macro-economic headwinds that were caused by inflationary pressures and higher interest rates, which have impacted, and may continue to impact, in an adverse manner, the Company’s operations, financial position and cash flows, in part due to the adverse impact on the Company’s customers and suppliers; the Company’s degree of success in developing, introducing and selling new or improved products and product enhancements including specifically the Company’s Poly Pro and Presto products, and the Company’s Apollo direct-to-garment platform; the extent of the Company’s ability to consummate sales to large accounts with multi-system delivery plans; the degree of the Company’s ability to fill orders for its systems and consumables; the extent of the Company’s ability to increase sales of its systems, ink and consumables; the extent of the Company’s ability to leverage its global infrastructure build-out; the development of the market for digital textile printing; the availability of alternative ink; competition; sales concentration; changes to the Company’s relationships with suppliers; the extent of the Company’s success in marketing; and those additional factors referred to under “Risk Factors” in Item 3.D of the Company’s Annual Report on Form 20-F for the year ended December 31, 2023, filed with the SEC on March 28, 2024. Any forward-looking statements in this press release are made as of the date hereof, whether as a result of new information, future events or otherwise, except as required by law.

 

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Non-GAAP Discussion Disclosure

 

The Company presents certain non-GAAP financial measures, in this press release and in the accompanying conference call to discuss the Company’s quarterly results. These non-GAAP financial measures reflect adjustments to corresponding GAAP financial measures in order to exclude the impact of the following: share-based compensation expenses; amortization of intangible assets; restructuring expenses; foreign exchange differences associated with ASC 842; and non-cash deferred tax income.

 

The Company defines “Adjusted EBITDA” as non-GAAP operating income (loss), which reflects the adjustments described in the preceding paragraph, as further adjusted to exclude depreciation expense.

 

The purpose of the foregoing non-GAAP financial measures is to convey the Company’s performance exclusive of non-cash charges and other items that are considered by management to be outside of the Company’s core operating results. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Furthermore, the non-GAAP measures are regularly used internally to understand, manage, and evaluate the Company’s business and make operating decisions, and the Company believes that they are useful to investors as a consistent and comparable measure of the ongoing performance of the Company’s business. The Company’s non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies.

 

The reconciliation tables included below present a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP financial measures.

 

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KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)

 

   December 31,   December 31, 
   2024   2023 
   (Unaudited)   (Audited) 
ASSETS        
CURRENT ASSETS:        
Cash and cash equivalents  $35,003   $39,605 
Short-term bank deposit   205,934    235,600 
Marketable securities   222,937    57,292 
Trade receivables, net   65,459    93,632 
Inventory   60,342    67,712 
Other accounts receivable and prepaid expenses   25,714    28,546 
Total current assets   615,389    522,387 
           
LONG-TERM ASSETS:          
Marketable securities   48,086    223,203 
Deposits and other long-term assets   10,542    8,209 
Severance pay fund   306    283 
Property,plant and equipment, net   45,342    50,905 
Equipment on lease, net   13,880    - 
Operating lease right-of-use assets   19,054    23,782 
Intangible assets, net   5,721    7,647 
Goodwill   29,164    29,164 
Total long-term assets   172,095    343,193 
           
Total assets   787,484    865,580 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
CURRENT LIABILITIES:          
Trade payables   9,019    6,936 
Employees and payroll accruals   13,101    12,121 
Deferred revenues and advances from customers   2,339    2,158 
Operating lease liabilities   3,311    5,073 
Other payables and accrued expenses   16,561    23,814 
Total current liabilities   44,331    50,102 
           
LONG-TERM LIABILITIES:          
Accrued severance pay   1,051    1,080 
Operating lease liabilities   15,065    18,533 
Other long-term liabilities   138    198 
Total long-term liabilities   16,254    19,811 
           
SHAREHOLDERS’ EQUITY   726,899    795,667 
           
Total liabilities and shareholders’ equity  $787,484   $865,580 

 

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KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except share and per share data)

 

   Three Months Ended   Year Ended 
   December 31,   December 31, 
   2024   2023   2024   2023 
   (Unaudited)   (Unaudited)   (Audited) 
                 
Revenues                
Products  $47,711   $43,573   $148,086   $161,045 
Services   12,985    13,012    55,739    58,741 
Total revenues   60,696    56,585    203,825    219,786 
                     
Cost of revenues                    
Products   18,088    23,125    61,697    91,516 
Services   11,479    18,888    50,366    61,313 
Total cost of revenues   29,567    42,013    112,063    152,829 
                     
Gross profit   31,129    14,572    91,762    66,957 
                     
Operating expenses:                    
Research and development, net   9,781    12,033    41,578    50,060 
Sales and marketing   15,200    17,909    58,413    66,836 
General and administrative   7,358    12,449    29,086    37,592 
Total operating expenses   32,339    42,391    129,077    154,488 
                     
Operating loss   (1,210)   (27,819)   (37,315)   (87,531)
                     
Financial income, net   3,849    5,424    22,350    24,150 
Income (loss) before taxes on income   2,639    (22,395)   (14,965)   (63,381)
                     
Taxes on income   423    539    1,835    970 
Net income (loss)  $2,216   $(22,934)  $(16,800)  $(64,351)
                     
Basic income (loss) per share  $0.05   $(0.48)  $(0.35)  $(1.31)
                     
Weighted average number of shares used in computing basic net income (loss) per share   47,180,390    48,231,916    47,482,820    49,160,266 
                     
Diluted income (loss) per share  $0.05   $(0.48)  $(0.35)  $(1.31)
                     
Weighted average number of shares used in computing diluted net income (loss) per share   48,222,449    48,231,916    47,482,820    49,160,266 

 

6

 

 

KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except share and per share data)

 

   Three Months Ended   Year Ended 
   December 31,   December 31, 
   2024   2023   2024   2023 
   (Unaudited)   (Unaudited) 
                 
Revenues  $60,696   $56,585   $203,825   $219,786 
                     
GAAP cost of revenues  $29,567   $42,013   $112,063   $152,829 
Cost of product recorded for share-based compensation (1)   (524)   (545)   (2,018)   (2,356)
Cost of service recorded for share-based compensation (1)   (409)   (447)   (1,703)   (1,758)
Intangible assets amortization on cost of product (2)   (176)   (260)   (936)   (1,053)
Intangible assets amortization on cost of service (2)   (160)   (160)   (640)   (640)
Restructuring expenses (3)   (1,067)   (11,501)   (1,981)   (11,590)
Non-GAAP cost of revenues  $27,231   $29,100   $104,785   $135,432 
                     
GAAP gross profit  $31,129   $14,572   $91,762   $66,957 
Gross profit adjustments   2,336    12,913    7,278    17,397 
Non-GAAP gross profit  $33,465   $27,485   $99,040   $84,354 
                     
GAAP operating expenses  $32,339   $42,391   $129,077   $154,488 
Share-based compensation (1)   (4,151)   (4,653)   (18,035)   (18,475)
Intangible assets amortization (2)   (88)   (93)   (350)   (550)
Restructuring expenses (3)   (105)   (7,579)   (862)   (7,785)
Non-GAAP operating expenses  $27,995   $30,066   $109,830   $127,678 
                     
GAAP Financial income, net  $3,849   $5,424   $22,350   $24,150 
Foreign exchange losses associated with ASC 842   (169)   1,579    388    378 
Non-GAAP Financial income , net  $3,680   $7,003   $22,738   $24,528 
                     
GAAP Taxes on income  $423   $539   $1,835   $970 
Non-cash deferred tax income   -    88    -    666 
Non-GAAP Taxes on income  $423   $627   $1,835   $1,636 
                     
GAAP Net income (loss)  $2,216   $(22,934)  $(16,800)  $(64,351)
Share-based compensation (1)   5,084    5,645    21,756    22,589 
Intangible assets amortization (2)   424    513    1,926    2,243 
Restructuring expenses (3)   1,172    19,080    2,843    19,375 
Foreign exchange losses associated with ASC 842   (169)   1,579    388    378 
Non-cash deferred tax income   -    (88)   -    (666)
Non-GAAP net income (loss)  $8,727   $3,795   $10,113   $(20,432)
                     
GAAP diluted income (loss) per share  $0.05   $(0.48)  $(0.35)  $(1.31)
                     
Non-GAAP diluted income (loss) per share  $0.18   $0.08   $0.20   $(0.42)
                     
Weighted average number of shares                    
                     
Shares used in computing GAAP diluted net income (loss) per share   48,222,449    48,231,916    47,482,820    49,160,266 
                     
Shares used in computing Non-GAAP diluted net income (loss) per share   49,868,143    50,094,714    49,341,794    49,160,266 
                     
(1) Share-based compensation                    
Cost of product revenues  $524   $545   $2,018   $2,356 
Cost of service revenues   409    447    1,703    1,758 
Research and development   1,255    1,329    5,310    5,759 
Sales and marketing   1,212    1,635    6,228    6,689 
General and administrative   1,684    1,689    6,497    6,027 
   $5,084   $5,645   $21,756   $22,589 
                     
(2) Intangible assets amortization                    
Cost of product revenues  $176   $260   $936   $1,053 
Cost of service revenues   160    160    640    640 
Sales and marketing   88    93    350    550 
   $424   $513   $1,926   $2,243 
                     
(3) Restructuring expenses                    
Cost of product revenues  $818   $5,569   $1,683   $5,658 
Cost of service revenues   249    5,932    298    5,932 
Research and development   -    860    235    880 
Sales and marketing   -    2,744    190    2,930 
General and administrative   105    3,975    437    3,975 
   $1,172   $19,080   $2,843   $19,375 

 

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KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands)

 

   Three Months Ended   Year Ended 
   December 31,   December 31, 
   2024   2023   2024   2023 
   (Unaudited)   (Unaudited) 
Cash flows from operating activities:                
                 
Net income (loss)  $2,216   $(22,934)  $(16,800)  $(64,351)
Adjustments to reconcile net loss to net cash used in operating activities:                    
Depreciation and amortization   3,313    3,287    13,047    14,700 
Restructuring and other charges   1,172    19,080    1,172    19,080 
Fair value of warrants deducted from revenues   -    4,841    3,273    13,842 
Share-based compensation   5,084    5,645    21,756    22,589 
Amortization of premium and accretion of discount on marketable securities, net   (230)   83    (389)   756 
Realized loss on sale and redemption of marketable securities   (45)   93    (164)   134 
Change in operating assets and liabilities:                    
Trade receivables, net   8,673    6,557    28,173    (19,220)
Other accounts receivables and prepaid expenses   1,795    (5,040)   2,832    (6,492)
Inventory   2,875    4,521    3,005    11,028 
Operating leases right-of-use assets and liabilities, net   (266)   1,544    (502)   (179)
Deposits and other long term assets   (674)   (103)   (2,333)   (2,282)
Trade payables   3,856    (2,902)   2,150    (6,491)
Employees and payroll accruals   1,020    (2,294)   2,456    (1,089)
Deferred revenues and advances from customers   798    (1,339)   181    (4,990)
Other payables and accrued expenses   (2,950)   (8,357)   (9,020)   (10,547)
Accrued severance pay, net   6    (14)   (52)   (152)
Other long - term liabilities   20    (74)   (60)   (1,018)
Net cash provided by (used in) operating activities   26,663    2,594    48,725    (34,682)
                     
Cash flows from investing activities:                    
                     
Purchase of property, plant and equipment   (897)   (934)   (4,394)   (7,006)
Production of equipment for lease to customers   (1,023)   -    (10,746)   - 
Proceeds from (investment in) short-term bank deposits, net   (36,533)   (15,505)   29,666    39,433 
Proceeds from sales and redemption of marketable securities   12,500    -    22,994    7,240 
Proceeds from maturities of marketable securities   12,012    6,300    56,641    20,522 
Investment in marketable securities   (16,772)   (9,526)   (62,673)   (33,977)
Net cash provided by (used in) investing activities   (30,713)   (19,665)   31,488    26,212 
                     
Cash flows from financing activities:                    
                     
Exercise of employee stock options   594    -    716    293 
Payments related to shares withheld for taxes   (402)   (608)   (1,476)   (1,045)
Repurchase of ordinary shares   (75,000)   (19,004)   (84,055)   (55,770)
Net cash used in financing activities   (74,808)   (19,612)   (84,815)   (56,522)
                     
Decrease in cash and cash equivalents   (78,858)   (36,683)   (4,602)   (64,992)
Cash and cash equivalents at the beginning of the period   113,861    76,288    39,605    104,597 
Cash and cash equivalents at the end of the period  $35,003   $39,605   $35,003   $39,605 
                     
Non-cash investing and financing activities:                    
                     
Purchase of property and equipment on credit   247    314    247    314 
Inventory transferred to be used as property and equipment and Equipment on lease   3,156    -    4,732    531 
Property, plant and equipment transferred to be used as inventory   47    131    367    865 
Lease liabilities arising from obtaining right-of-use assets   623    (2,875)   (448)   2,934 

 

8

 

 

KORNIT DIGITAL LTD.

AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA

(U.S. dollars in thousands, except share and per share data)

 

   Three Months Ended   Year Ended 
   December 31,   December 31, 
   2024   2023   2024   2023 
   (Unaudited)   (Unaudited) 
                 
GAAP Revenues  $60,696   $56,585   $203,825   $219,786 
                     
GAAP Net  income (loss)   2,216    (22,934)   (16,800)   (64,351)
Taxes on income   423    539    1,835    970 
Financial income   (3,849)   (5,424)   (22,350)   (24,150)
Share-based compensation   5,084    5,645    21,756    22,589 
Intangible assets amortization   424    513    1,926    2,243 
Restructuring expenses   1,172    19,080    2,843    19,375 
Non-GAAP Operating income (loss)   5,470    (2,581)   (10,790)   (43,324)
Depreciation   2,889    2,774    11,121    12,457 
Adjusted EBITDA  $8,359   $193   $331   $(30,867)

 

 

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