Forward-Looking Statements
Mobileye’s Business Outlook and other statements in this release that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements and should be evaluated as such. Forward-looking statements include information concerning possible or assumed future results of operations, including Mobileye’s 2022 full-year guidance and descriptions of our business plan and strategies. These statements often include words such as “anticipate,” “expect,” “suggests,” “plan,” “believe,” “intend,” “estimates,” “targets,” “projects,” “should,” “could,” “would,” “may,” “will,” “forecast,” or the negative of these terms, and other similar expressions, although not all forward-looking statements contain these words. We base these forward-looking statements or projections, including Mobileye’s full-year guidance, on our current expectations, plans and assumptions that we have made in light of our experience in the industry, as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances and at such time. You should understand that these statements are not guarantees of performance or results. The forward-looking statements and projections are subject to and involve risks, uncertainties and assumptions and you should not place undue reliance on these forward-looking statements or projections. Although we believe that these forward-looking statements and projections are based on reasonable assumptions at the time they are made, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those expressed in the forward-looking statements and projections.
Important factors that may materially affect such forward-looking statements and projections include the following: future business, social and environmental performance, goals and measures; our anticipated growth prospects and trends in markets and industries relevant to our business; business and investment plans; expectations about our ability to maintain or enhance our leadership position in the markets in which we participate; future consumer demand and behavior; future products and technology, and the expected availability and benefits of such products and technology; development of regulatory frameworks for current and future technology; projected cost and pricing trends; future production capacity and product supply; potential future benefits and competitive advantages associated with our technologies and architecture and the data we have accumulated; the future purchase, use and availability of products, components and services supplied by third parties, including third-party IP and manufacturing services; uncertain events or assumptions, including statements relating to our addressable markets, estimated vehicle production and market opportunity, potential production volumes associated with design wins and other characterizations of future events or circumstances; future responses to and effects of the COVID-19 pandemic; availability, uses, sufficiency and cost of capital and capital resources, including expected returns to stockholders such as dividends, and the expected timing of future dividends; tax- and accounting-related expectations.
Detailed information regarding these and other factors that could affect Mobileye’s business and results is included in Mobileye’s SEC filings, including the company’s Registration Statement (No. 333-267685) on Form S-1, particularly in the section entitled the “Risk Factors”. Copies of these filings may be obtained by visiting our Investor Relations website at ir.mobileye.com or the SEC’s website at www.sec.gov.
Third Quarter 2022 Financial Results
Mobileye Group Condensed Combined Statements of Operations (Unaudited) |
||||||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||||||
U.S. dollars in millions, except share and per share amounts | October 1, | September 25, | October 1, | September 25, | ||||||||||||||||
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|||||||||
Revenue | $ |
450 |
|
$ |
326 |
|
$ |
1,304 |
|
$ |
1,030 |
|
||||||||
Cost of revenue |
|
233 |
|
|
173 |
|
|
682 |
|
|
529 |
|
||||||||
Gross profit |
|
217 |
|
|
153 |
|
|
622 |
|
|
501 |
|
||||||||
Operating expenses | ||||||||||||||||||||
Research and development, net |
|
206 |
|
|
132 |
|
|
565 |
|
|
390 |
|
||||||||
Sales and marketing |
|
27 |
|
|
33 |
|
|
91 |
|
|
98 |
|
||||||||
General and administrative |
|
9 |
|
|
8 |
|
|
27 |
|
|
26 |
|
||||||||
Total operating expenses |
|
242 |
|
|
173 |
|
|
683 |
|
|
514 |
|
||||||||
Operating income (loss) |
|
(25 |
) |
|
(20 |
) |
|
(61 |
) |
|
(13 |
) |
||||||||
Interest income with related party |
|
5 |
|
|
- |
|
|
9 |
|
|
2 |
|
||||||||
Interest expense with related party |
|
(11 |
) |
|
- |
|
|
(20 |
) |
|
- |
|
||||||||
Other income (expense), net |
|
1 |
|
|
- |
|
|
6 |
|
|
- |
|
||||||||
Income (loss) before income taxes |
|
(30 |
) |
|
(20 |
) |
|
(66 |
) |
|
(11 |
) |
||||||||
Benefit (provision) for income taxes |
|
(15 |
) |
|
(6 |
) |
|
(46 |
) |
|
(11 |
) |
||||||||
Net income (loss) | $ |
(45 |
) |
$ |
(26 |
) |
$ |
(112 |
) |
$ |
(22 |
) |
||||||||
Earnings (loss) per share: | ||||||||||||||||||||
Basic and diluted | $ |
(0.06 |
) |
$ |
(0.03 |
) |
$ |
(0.15 |
) |
$ |
(0.03 |
) |
||||||||
Weighted-average number of shares used in computation of earnings (loss) per share (in millions): | ||||||||||||||||||||
Basic and diluted |
|
750 |
|
|
750 |
|
|
750 |
|
|
750 |
|
Mobileye Group Condensed Combined Balance Sheets (Unaudited) |
||||||
As of |
||||||
U.S. dollars in millions | October 1, | December 25, | ||||
2022 |
2021 |
|||||
Assets | ||||||
Current assets | ||||||
Cash and cash equivalents | 871 |
616 |
||||
Trade account receivables, net | 222 |
155 |
||||
Inventories | 105 |
97 |
||||
Related party loan | 901 |
1,326 |
||||
Other current assets | 63 |
76 |
||||
Total current assets | 2,162 |
2,270 |
||||
Non-current assets | ||||||
Property and equipment, net | 354 |
304 |
||||
Intangible assets, net | 2,658 |
3,071 |
||||
Goodwill | 10,895 |
10,895 |
||||
Other long-term assets | 95 |
115 |
||||
Total non-current assets | 14,002 |
14,385 |
||||
TOTAL ASSETS | 16,164 |
16,655 |
||||
Liabilities and Equity | ||||||
Current liabilities | ||||||
Accounts payable and accrued expenses | 160 |
160 |
||||
Employee related accrued expenses | 75 |
102 |
||||
Related party payable | 966 |
163 |
||||
Dividend Note with related party | 3,520 |
— |
||||
Other current liabilities | 59 |
49 |
||||
Total current liabilities | 4,780 |
474 |
||||
Non-current liabilities | ||||||
Long-term employee benefits | 54 |
94 |
||||
Deferred tax liabilities | 162 |
181 |
||||
Other long-term liabilities | 8 |
17 |
||||
Total non-current liabilities | 224 |
292 |
||||
TOTAL LIABILITIES | 5,004 |
766 |
||||
Equity | ||||||
Parent net investment | 11,178 |
15,884 |
||||
Accumulated other comprehensive income (loss) | (18) |
5 |
||||
TOTAL EQUITY | 11,160 |
15,889 |
||||
TOTAL LIABILITIES AND EQUITY | 16,164 |
16,655 |
Mobileye Group Condensed Combined Statements of Cash Flows (Unaudited) |
||||
Nine months ended | Nine months ended | |||
U.S. dollars in millions | October 1, | September 25, | ||
2022 |
2021 |
|||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net income (loss) | (112) |
(22) |
||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||
Depreciation of property and equipment | 17 |
12 |
||
Share-based compensation | 112 |
73 |
||
Amortization of intangible assets | 413 |
368 |
||
Other | 35 |
(27) |
||
Changes in operating assets and liabilities: | ||||
Decrease (increase) in trade accounts receivables | (67) |
(57) |
||
Decrease (increase) in other current assets | 28 |
(4) |
||
Decrease (increase) in inventories | (8) |
30 |
||
Increase (decrease) in account payables and accrued expenses | 22 |
31 |
||
Increase (decrease) in employee-related accrued expenses and long term benefits | (67) |
20 |
||
Increase (decrease) in other current-liabilities | 10 |
15 |
||
Decrease (increase) in other long term assets | 15 |
(1) |
||
Increase (decrease) in long-term liabilities | (3) |
— |
||
Net cash provided by operating activities | 395 |
438 |
||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Purchase of property and equipment | (79) |
(98) |
||
Repayments of loan due from related party | 734 |
— |
||
Issuance of loan to related party | (336) |
(390) |
||
Net cash provided by (used in) investing activities | 319 |
(488) |
||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||
Net transfers from Parent | 99 |
69 |
||
Dividend paid | (336) |
— |
||
Share-based compensation recharge | (200) |
— |
||
Deferred offering costs | (14) |
— |
||
Changes in withholding tax related to employee stock plans | — |
(2) |
||
Net cash provided by (used in) financing activities | (451) |
67 |
||
Effect of foreign exchange rate changes on cash and cash equivalents | (6) |
— |
||
Increase in cash, cash equivalents and restricted cash | 257 |
17 |
||
Balance of cash, cash equivalents and restricted cash, at beginning of year | 625 |
93 |
||
Balance of cash, cash equivalents and restricted cash, at end of period | 882 |
110 |
Mobileye Group Reconciliation of GAAP Gross Profit and Gross Margin to Non-GAAP Adjusted Gross Profit and Adjusted Gross Margin (Unaudited) 3 |
||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||
U.S. dollars in millions | October 1, | September 25, | October 1, | September 25, | ||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||||
% of |
% of |
% of |
% of |
|||||||||||||||
Amount |
Revenue |
Amount |
Revenue |
Amount |
Revenue |
Amount |
Revenue |
|||||||||||
Gross profit | $ |
217 |
48 |
% |
$ |
153 |
47 |
% |
$ |
622 |
48 |
% |
$ |
501 |
49 |
% |
||
Add: Amortization of acquired intangible assets |
|
115 |
26 |
% |
|
100 |
31 |
% |
|
355 |
27 |
% |
|
300 |
29 |
% |
||
Add: Share-based compensation expense |
|
- |
- |
|
|
- |
- |
|
|
- |
- |
|
|
- |
- |
|
||
Adjusted Gross Profit | $ |
332 |
74 |
% |
$ |
253 |
78 |
% |
$ |
977 |
75 |
% |
$ |
801 |
78 |
% |
||
3 Adjusted gross margin is calculated as adjusted gross profit as a percentage of revenue |
Mobileye Group Reconciliation of GAAP Operating Income and Operating Margin to Non-GAAP Adjusted Operating Income and Operating Margin (Unaudited) 4 |
|||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
U.S. dollars in millions | October 1, | September 25, | October 1, | September 25, | |||||||||||||||||||
2022 |
2021 |
2022 |
2021 |
||||||||||||||||||||
% of |
% of |
% of |
% of |
||||||||||||||||||||
Amount |
Revenue |
Amount |
Revenue |
Amount |
Revenue |
Amount |
Revenue |
||||||||||||||||
Operating income (loss) | $ |
(25 |
) |
-6 |
% |
$ |
(20 |
) |
-6 |
% |
$ |
(61 |
) |
-5 |
% |
$ |
(13 |
) |
-1 |
% |
|||
Add: Amortization of acquired intangible assets |
|
131 |
|
29 |
% |
|
123 |
|
38 |
% |
|
413 |
|
32 |
% |
|
368 |
|
36 |
% |
|||
Add: Expenses related to the IPO |
|
1 |
|
0 |
% |
|
- |
|
0 |
% |
|
4 |
|
0 |
% |
|
- |
|
0 |
% |
|||
Add: Share-based compensation expense |
|
36 |
|
8 |
% |
|
24 |
|
7 |
% |
|
112 |
|
9 |
% |
|
73 |
|
7 |
% |
|||
Adjusted Operating Income | $ |
143 |
|
32 |
% |
$ |
127 |
|
39 |
% |
$ |
468 |
|
36 |
% |
$ |
428 |
|
42 |
% |
|||
4 Adjusted operating margin is calculated as adjusted operating income as a percentage of revenue |
Mobileye Group Reconciliation of GAAP Net Income to Non-GAAP Adjusted Net Income (Unaudited) |
|||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||
U.S. dollars in millions | October 1, |
September 25, |
October 1, |
September 25, |
|||||||||||
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
||||
Net income (loss) | $ |
(45 |
) |
$ |
(26 |
) |
$ |
(112 |
) |
$ |
(22 |
) |
|||
Add: Amortization of acquired intangible assets |
|
131 |
|
|
123 |
|
|
413 |
|
|
368 |
|
|||
Add: Expenses related to the IPO |
|
1 |
|
|
- |
|
|
4 |
|
|
- |
|
|||
Add: Share-based compensation expense |
|
36 |
|
|
24 |
|
|
112 |
|
|
73 |
|
|||
Less: Income tax effects |
|
(9 |
) |
|
(14 |
) |
|
(27 |
) |
|
(42 |
) |
|||
Adjusted Net Income | $ |
114 |
|
$ |
107 |
|
$ |
390 |
|
$ |
377 |
|
Supplemental Information (Unaudited) – Average System Price |
|||||||||||||||
Q3 2021 |
Q4 2021 |
Q1 2022 |
Q2 2022 |
Q3 2022 |
|||||||||||
EyeQ and SuperVision revenue (U.S. dollars in millions) | $ |
308 |
$ |
337 |
$ |
378 |
$ |
441 |
$ |
432 |
|||||
Number of systems shipped (in millions) |
|
6.7 |
|
7.0 |
|
7.4 |
|
8.5 |
|
8.2 |
|||||
Average system price (U.S. dollars) | $ |
45.7 |
$ |
48.3 |
$ |
51.0 |
$ |
52.0 |
$ |
53.0 |