Impinj, Inc. reports 2.8% CAPEX decline in 2018 and 2.1% Revenue decline
02/20/2019 • About Impinj, Inc. (
$PI) • By InTwits
Impinj, Inc. reported 2018 financial results today. Here are the key drivers of the company's long term financial model:
- The company operates at negative EBITDA Margin: -24.7%
- Impinj, Inc. motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2014-2018 was 0.0% while average EBITDA Margin was -7.1% for the sames years
- Impinj, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.9%. At the same time it's a lot of higher than industry average of 7.4%.
- CAPEX is quite volatile: $6m in 2018, $7m in 2017, $4m in 2016, $7m in 2015, $1m in 2014
- The company has unprofitable business model: ROIC is -27.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue decreased on 2.1%. Annual revenue decline showed slowdown in 18Q4 - revenue jumped on 28.9%. During 2014-2018 Revenue growth topped in 2016 at 43.1% and was decelerating since that time. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 14.3 pp from -10.4% to -24.7% in 2018. EBITDA Margin declined at -7.0 pp per annum in 2014-2018.
Gross Margin decreased on 4.3 pp from 51.8% to 47.5% in 2018. SG&A as a % of Revenue increased on 5.3 pp from 39.7% to 45.0% in 2018. SG&A as a % of Revenue stuck to a growing trend at 4.8 pp per annum in the last 5 years.
Net Income margin dropped on 14.9 pp from -13.8% to -28.7% in 2018. Net Income margin stuck to a declining trend at -7.3 pp per annum in 2014-2018.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 5.2% in 2018. The company's CAPEX/Revenue decreased on 4.3 pp from 9.5% in 2015 to 5.2% in 2018. For the last three years the average CAPEX/Revenue was 4.5%.
Return on investment
The company operates at negative ROIC (-27.2%) and ROE (-32.5%). ROIC dropped on 14.7 pp from -12.5% to -27.2% in 2018. ROE dropped on 18.2 pp from -14.3% to -32.5% in 2018.
Leverage (Debt)
Debt level is 1.5x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in 2018. Debt jumped on 116% while cash decreased on 9.1%.
Impinj, Inc. has no short term refinancing risk: cash is higher than short term debt (271.7%).
Management team
Chris Diorio is a the company's CEO. Chris Diorio is a founder and has spent 4 years with the company. The company's CFO Eric Brodersen has spent 1 year with the company.
Financial and operational results
FY ended 12/31/2018
Impinj, Inc. ($PI) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 63.8 | 78.5 | 112.3 | 125.3 | 122.6 | -2.1% |
| Gross Profit | 33.7 | 40.8 | 59.5 | 64.9 | 58.3 | -10.3% |
| SG&A | 17.4 | 21.7 | 34.8 | 49.7 | 55.2 | 11.0% |
| EBITDA | 1.8 | 3.6 | 2.4 | -13.1 | -30.3 | |
| Net Income | 0.3 | 0.9 | -1.7 | -17.3 | -35.2 | |
Balance Sheet
|
|---|
| Cash | 6.9 | 10.1 | 33.6 | 19.3 | 17.5 | -9.1% |
| Short Term Debt | 4.8 | 6.4 | 3.7 | 5.0 | 6.5 | 28.4% |
| Long Term Debt | 4.8 | 13.2 | 11.4 | 6.2 | 17.9 | 186.5% |
Cash flow
|
|---|
| Capex | 1.0 | 7.5 | 3.5 | 6.6 | 6.4 | -2.8% |
Ratios
|
|---|
| Revenue growth | 14.9% | 23.1% | 43.1% | 11.6% | -2.1% | |
| EBITDA growth | -48.1% | 96.1% | -33.4% | -648.9% | 132.1% | |
|
|---|
| Gross Margin | 52.9% | 52.0% | 52.9% | 51.8% | 47.5% | -4.3% |
| EBITDA Margin | 2.9% | 4.6% | 2.1% | -10.4% | -24.7% | -14.3% |
| SG&A, % of revenue | 27.3% | 27.6% | 31.0% | 39.7% | 45.0% | 5.3% |
| Net Income Margin | 0.5% | 1.1% | -1.5% | -13.8% | -28.7% | -14.9% |
| CAPEX, % of revenue | 1.6% | 9.5% | 3.1% | 5.2% | 5.2% | -0.0% |
|
|---|
| ROIC | | 6.0% | -0.6% | -12.5% | -27.2% | -14.7% |
| ROE | | | | -14.3% | -32.5% | -18.2% |
| Net Debt/EBITDA | 1.5x | 2.7x | -7.8x | | |
Impinj, Inc. ($PI) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 25 | 29 | 34 | 35 | | -21.0% | -16.3% | 5.5% | 28.9% |
| EBITDA | -13 | -6 | -6 | -5 | | | -4,169.8% | | |
| Net Income | -14 | -8 | -7 | -6 | | | | | |
Balance Sheet
|
|---|
| Cash | 28 | 16 | 18 | 18 | | 283.2% | 4.5% | 0.2% | -9.1% |
| Short Term Debt | 1 | 2 | 5 | 6 | | -82.2% | -55.4% | -4.8% | 28.4% |
| Long Term Debt | 20 | 19 | 20 | 18 | | 102.8% | 114.5% | 165.8% | 186.5% |
Ratios
|
|---|
| Gross Margin | 46.9% | 47.9% | 48.1% | 47.1% | | -5.9% | -5.4% | -4.0% | -1.3% |
| EBITDA Margin | -52.4% | -22.7% | -16.5% | -14.6% | | -48.8% | -23.1% | -5.3% | 16.8% |
| Net Income Margin | -57.6% | -27.1% | -20.5% | -17.3% | | -50.8% | -24.2% | -5.7% | 17.5% |
Peers in Semiconductors
Below you can find Impinj, Inc. benchmarking vs. other companies in Semiconductors industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NanoFlex Power Corp ($OPVS) | | | | 72.5% | 354.8% |
| MoSys, Inc. ($MOSY) | | -18.4% | 37.2% | 46.8% | 87.7% |
| SMART Global Holdings, Inc. ($SGH) | | | -16.9% | 42.5% | 69.3% |
| Micron Technology, Inc. ($MU) | | -1.0% | -23.4% | 63.9% | 49.5% |
| Adesto Technologies Corporation ($IOTS) | | 4.3% | 1.6% | 27.6% | 48.8% |
| |
|---|
| Median (67 companies) | 54.6% | 8.5% | 4.4% | 10.9% | 5.0% |
|---|
| Impinj, Inc. ($PI) | | 23.1% | 43.1% | 11.6% | -2.1% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| CEVA, Inc. ($CEVA) | 90.2% | 90.9% | 91.6% | 92.1% | 89.8% |
| NVE Corporation ($NVEC) | 77.9% | 80.3% | 76.1% | 78.5% | 79.0% |
| Rambus, Inc. ($RMBS) | 85.9% | 84.7% | 80.1% | 79.9% | 76.8% |
| Universal Display Corporation ($OLED) | 76.0% | 64.2% | 83.9% | 80.8% | 75.5% |
| Intermolecular, Inc. ($IMI) | 48.3% | 57.4% | 66.5% | 67.5% | 70.3% |
| |
|---|
| Median (65 companies) | 45.3% | 47.0% | 47.2% | 48.6% | 51.0% |
|---|
| Impinj, Inc. ($PI) | 52.9% | 52.0% | 52.9% | 51.8% | 47.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NVE Corporation ($NVEC) | 58.8% | 66.0% | 61.8% | 65.6% | 65.1% |
| Micron Technology, Inc. ($MU) | 31.7% | 35.0% | 25.4% | 47.9% | 65.0% |
| NXP Semiconductors N.V. ($NXPI) | 25.7% | 41.5% | 21.6% | 46.2% | 49.9% |
| Texas Instruments Incorporated ($TXN) | 39.7% | 42.0% | 43.5% | 46.7% | 48.6% |
| Intel Corp ($INTC) | 42.8% | 41.0% | 35.2% | 41.7% | 45.7% |
| |
|---|
| Median (66 companies) | 9.9% | 11.5% | 9.2% | 10.7% | 10.0% |
|---|
| Impinj, Inc. ($PI) | 2.9% | 4.6% | 2.1% | -10.4% | -24.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Alpha and Omega Semiconductor Limited ($AOSL) | 3.0% | 6.6% | 6.5% | 12.2% | 42.2% |
| Renesola Ltd. ($SOL) | 3.5% | 0.0% | 0.0% | 78.0% | 41.7% |
| First Solar, Inc. ($FSLR) | 7.6% | 4.0% | 7.9% | 17.5% | 33.0% |
| Sigma Designs Inc ($SIGM) | 11.0% | 6.5% | 6.2% | 14.1% | 29.3% |
| Micron Technology, Inc. ($MU) | 19.0% | 24.8% | 46.9% | 23.3% | 29.2% |
| |
|---|
| Median (66 companies) | 3.6% | 4.0% | 3.7% | 4.7% | 4.4% |
|---|
| Impinj, Inc. ($PI) | 1.6% | 9.5% | 3.1% | 5.2% | 5.2% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| SMART Global Holdings, Inc. ($SGH) | | | 2.5% | 21.5% | 51.7% |
| Texas Instruments Incorporated ($TXN) | 25.1% | 29.8% | 34.9% | 43.1% | 47.5% |
| Micron Technology, Inc. ($MU) | 18.8% | 15.8% | 0.8% | 21.5% | 42.9% |
| Applied Materials Inc ($AMAT) | 15.8% | 15.2% | 19.0% | 31.2% | 36.4% |
| NVIDIA Corporation ($NVDA) | 9.2% | 13.3% | 13.1% | 27.3% | 35.3% |
| |
|---|
| Median (73 companies) | 5.3% | 3.8% | 1.7% | 3.2% | 5.2% |
|---|
| Impinj, Inc. ($PI) | | 6.0% | -0.6% | -12.5% | -27.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| MACOM Technology Solutions Holdings, Inc. ($MTSI) | 25.4x | 3.3x | 3.0x | 7.2x | 98.6x |
| Inphi Corporation ($IPHI) | | -6.4x | 4.5x | 33.7x | 32.2x |
| JinkoSolar Holding Company Limited ($JKS) | 4.2x | 3.3x | 4.1x | 11.0x | 8.2x |
| Lattice Semiconductor Corporation ($LSCC) | -1.8x | | 6.5x | 19.0x | 3.9x |
| Renesola Ltd. ($SOL) | 7.0x | 35.0x | 123.6x | 2.3x | 3.3x |
| |
|---|
| Median (46 companies) | -0.6x | -0.3x | 0.4x | 0.4x | 0.3x |
|---|
