Cutera Announces Second Quarter 2022 Financial Results

Record second-quarter revenue driven by ongoing momentum in Capital Equipment and Consumable Product segments

Over one hundred new patients treated during the first quarter of AviClear's availability

Management reiterates full-year revenue guidance despite $15 million of annual foreign exchange headwinds

BRISBANE, California, August 4, 2022 ─ Cutera, Inc. (NASDAQ: CUTR) ("Cutera" or the "Company"), a leading provider of laser and other energy-based aesthetic systems for practitioners worldwide, today reported financial results for the second quarter ended June 30, 2022.
Second Quarter 2022 Financial and Operational Highlights

•Consolidated revenue was $64.2 million, driven by strength in capital equipment and consumable product demand.

•Over 50 AviClear devices were placed and activated during the first quarter of the product's limited commercial release.

•Gross Margin of 54.6% in the quarter, compared to 57.7% in the prior-year period.

◦Excluding the 190 basis point impact from the AviClear program and foreign exchange headwinds of approximately 180 basis points, the gross margin would have been 58.3%.

•Operating expenses were $45.1 million in the quarter, compared to $31.7 million in the prior-year period. Operating expenses during the period included $7.0 million in AviClear program spending in addition to $2.4 million of ERP implementation expenses.

•GAAP Net loss was $47.3 million, inclusive of an non-recurring charge of $34.4 million for the extinguishment of 50% of the 2026 convertible notes.

•Adjusted EBITDA was a loss of $1.6 million compared to a gain of $6.8 million in the prior-year period.

◦Excluding the non-GAAP AviClear program impacts of $7.5 million in the quarter and foreign exchange headwinds of $2.4 million over the prior year period, comparable adjusted EBITDA would have been $8.3 million.

•Completed $240 million convertible debt financing, ending the quarter with $278.2 million in cash, cash equivalents, and marketable securities on the balance sheet after retiring $69.1 million in convertible notes due 2026.




Key Revenue Metrics
Three Months Ended June 30, 2022 % Change 2022 Vs 2021 Constant Currency
Capital Equipment $ 43.7 23 % 27 %
Skincare $ 9.6 -18 % -6 %
Consumables $ 5.3 20 % 23 %
Service $ 5.6 -17 % -13 %
Recurring $ 20.6 -11 % -2 %
Total Revenue $ 64.2 10 % 15 %

Key Profit Metrics
Three Months Ended June 30, 2022 Constant Currency
GAAP Margin % 54.6% 56.4%
Non-GAAP Margin % 55.6% 57.4%
Adjusted EBITDA ($1.6) $0.7
% Margin -2.5 % 1.2%




Key Revenue Metrics
Six Months Ended June 30, 2022 % Change 2022 Vs 2021 Constant Currency
Capital Equipment $ 80.2 25 % 29 %
Skincare $ 21.3 -12 % -1 %
Consumables $ 9.2 25 % 28 %
Service $ 11.6 -10 % -7 %
Recurring $ 42.1 -5 % 2 %
Total Revenue $ 122.2 13 % 18 %



Key Profit Metrics
Six Months Ended June 30, 2022 Constant Currency
GAAP Margin % 54.7% 56.3%
Non-GAAP Margin % 55.7% 57.2%
Adjusted EBITDA ($5.4) ($1.5)
% Margin -4.5% -1.2%

"I am excited by the momentum we continue to see in our core business, as prior investments in our sales force drove strong results in capital and consumables product segments in North America, Europe, and Australia/New Zealand in particular. Our team is further encouraged by the resiliency and strength of underlying demand trends in the marketplace," commented Dave Mowry, Chief Executive Officer of Cutera, Inc. "During the quarter, our team achieved the successful launch of AviClear, our first-mover product for the treatment of acne. In the first three months of our limited commercial release of AviClear, we were able to validate successful clinical outcomes in the hands of our customers, verify patient satisfaction with AviClear post-treatment patient survey data, and onboard dozens of practices in the use of the AviClear Laser as they look to provide their patients with a drug-free solution for acne while enhancing the profitablilty of their practices. We are looking forward to expanding the footprint of new AviClear practices during the next phase of the limited commercial release and significantly ramping the utilization of the device."

2022 Outlook

Management is reiterating its 2022 revenue guidance of $255 million to $260 million, entirely absorbing the impact of the unprecedented foreign exchange headwinds of $15 million, implying constant currency growth of 17% to 19%. This guidance does not include revenue from our AviClear device as we continue with its limited commercial release. The company plans to add over 100 new AviClear devices into the market during the course of the third quarter of 2022. Based on current AviClear trends, management expects to move into a full commercial launch by the end of the current calendar year.
Conference Call
The Company's management will host a conference call to discuss these results and related matters today at 1:15 p.m. PT (4:15 p.m. ET). Participating in the call will be Dave Mowry, Chief Executive Officer, and Rohan Seth, Chief Financial Officer.

To participate in the conference call, dial 1-800-319-4610 (domestic) or +1-631-891-4304 (international).

The call will also be a webcast and can be accessed from the Investor Relations section of Cutera's website at http://www.cutera.com/. The webcast replay of the call will be available at the same site approximately one hour after the end of the call.

About Cutera, Inc.
Brisbane, California-based Cutera is a leading provider of aesthetic and dermatology solutions for practitioners worldwide. Since 1998, Cutera has been developing innovative, easy-to-use products that harness the power of science and nature to enable medical practitioners to offer safe and effective treatments to their patients. For more information, call +1 415-657-5500 or 1-888-4CUTERA or visit www.cutera.com.
*Use of Non-GAAP Financial Measures
In this press release, in order to supplement the Company's condensed consolidated financial statements presented in accordance with Generally Accepted Accounting Principles, or GAAP, management has disclosed certain non-GAAP financial measures for the statement of operations and net income (loss) per share. Non-GAAP adjustments include stock-based compensation, depreciation, amortization, executive and other non-recurring separation costs, customer relationship management ("CRM") and enterprise resource planning ("ERP") system costs, non-recurring legal and litigation costs, as well as the net tax impact of excluding these items. From time to time in the future, there may be other items that we may exclude if the Company believes that doing so is consistent with the goal of providing useful information to investors and management. The Company has provided a reconciliation of each non-GAAP financial measure used in this earnings release to the most directly comparable GAAP financial measure. The Company has not provided a reconciliation of non-GAAP guidance measures to the corresponding GAAP measures on a forward-looking basis due to the potential significant variability, limited visibility, unpredictability, or unique non-recurring nature of the items. Forward-looking non-GAAP measures include adjusted EBITDA. The Company defines adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, stock-based


compensation, executive and other non-recurring separation costs, customer relationship management and enterprise resource planning system costs, and non-recurring legal and litigation costs.
Company management uses these measurements as aids in monitoring the Company's ongoing financial performance from quarter to quarter, and year to year, on a regular basis and for benchmarking against other similar companies. Non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. These non-GAAP financial measures should be considered along with, but not as alternatives to, the operating performance measure as prescribed by GAAP. Non-GAAP financial measures for the statement of operations and net income per share exclude the following:
Non-cash expenses for stock-based compensation. The Company has excluded the effect of stock-based compensation expenses in calculating its non-GAAP operating expenses and net income measures. Although stock-based compensation is a key incentive offered to the Company's employees, the Company continues to evaluate its business performance excluding stock-based compensation expenses. The Company records stock-based compensation expense related to grants of options, employee stock purchase plan, and performance and restricted stock. Depending upon the size, timing and the terms of the grants, this expense may vary significantly but will recur in future periods. The Company believes that excluding stock-based compensation better allows for comparisons to its peer companies;

Depreciation and amortization. The Company has excluded depreciation and amortization expense in calculating its non-GAAP operating expenses and net income measures. Depreciation and amortization are non-cash charges to current operations;
Executive and other non-recurring separation costs. We have excluded costs associated with the resignation of our former Executive Officers in calculating our non-GAAP operating expenses and net income measures. We exclude these and other non-recurring employee separation costs because we believe that these items do not reflect future operating expenses;
Customer Relationship Management. We have excluded CRM system costs related to direct and incremental costs incurred in connection with our multi-phase implementation of a new CRM solution and the related technology infrastructure costs. We exclude these costs because we believe that these items do not reflect future operating expenses and will be inconsistent in amounts and frequency making it difficult to contribute to a meaningful evaluation of our operating performance;
Enterprise Resource Planning. We have excluded ERP system costs related to direct and incremental costs incurred in connection with our multi-phase implementation of a new ERP solution and the related technology infrastructure costs. We exclude these costs because we believe that these items do not reflect future operating expenses and will be inconsistent in amounts and frequency making it difficult to contribute to a meaningful evaluation of our operating performance; and
Non-recurring legal and litigation costs. We have excluded costs incurred related to third party litigation and disputes, that are of a non-recurring nature.

The Company believes that excluding all of the items above allows users of its financial statements to better review and assess both current and historical results of operations.
Safe Harbor Statement
Certain statements in this press release, other than purely historical information, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements include, but are not limited to, Cutera's plans, objectives, strategies, financial performance and outlook, product launches and performance, trends, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, the Company's actual financial results, performance, achievements or prospects may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as "may,""could,""seek,""guidance,""predict,""potential,""likely,""believe,""will,""should,""expect,""anticipate,""estimate,""plan,""intend,""forecast,""foresee" or variations of these terms and similar expressions, or the negative of these terms or similar expressions. Forward-looking statements are based on management's current, preliminary expectations and are subject to risks and uncertainties, which may cause Cutera's actual results to differ materially from the statements contained herein. These statements are not guarantees of future performance, and stockholders should not place undue reliance on forward-looking statements. There are a number of risks, uncertainties and other important factors, many of which are beyond the Company's control, that could cause its actual results to differ materially from the forward-looking statements contained in this press release, including those described in the "Risk Factors" section of Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, the Registration Statement on Form S-,8 and other documents filed from time to time with the United States Securities and Exchange Commission by Cutera.

All information in this press release is as of the date of its release. Accordingly, undue reliance should not be placed on forward-looking statements. Cutera undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date they were made, or to reflect the occurrence of unanticipated events. If the Company updates one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements. Cutera's financial performance for the first quarter ended March 31, 2022, as discussed in this release, is preliminary and unaudited, and subject to adjustment.


Cutera, Inc.
Greg Barker
VP, Corporate FP&A
415-657-5500
IR@cutera.com


CUTERA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
June 30,
2022
December 31,
2021
Assets
Current assets:
Cash and cash equivalents $ 75,050 $ 164,164
Marketable investments 203,126 -
Accounts receivable, net 32,148 31,449
Inventories, net 45,410 39,503
Other current assets and prepaid expenses 17,579 14,545
Total current assets 373,313 249,661
Property and equipment, net 24,470 3,019
Deferred tax asset 698 778
Goodwill 1,339 1,339
Operating lease right-of-use assets 13,771 14,627
Other long-term assets 9,801 10,169
Restricted cash 700 700
Total assets $ 424,092 $ 280,293
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 25,365 $ 7,891
Accrued liabilities 47,539 54,100
Operating leases liabilities 2,714 2,419
Deferred revenue 10,098 9,490
Total current liabilities 85,716 73,900
Deferred revenue, net of current portion 1,429 1,335
Operating lease liabilities, net of current portion 12,368 13,483
Convertible notes, net of unamortized debt issuance costs 299,856 134,243
Other long-term liabilities 849 763
Total liabilities 400,218 223,724
Stockholders' equity:
Common stock 20 18
Additional paid-in capital 144,628 114,724
Accumulated other comprehensive loss (183) -
Accumulated deficit (120,591) (58,173)
Total stockholders' equity 23,874 56,569
Total liabilities and stockholders' equity $ 424,092 $ 280,293



CUTERA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30,
2022
June 30,
2021
June 30,
2022
June 30,
2021
Products $ 58,589 $ 51,812 $ 110,655 $ 95,363
Service 5,635 6,777 11,583 12,894
Total net revenue 64,224 58,589 122,238 108,257
Products 25,899 20,892 48,811 39,224
Service 3,281 3,908 6,595 7,534
Total cost of revenue 29,180 24,800 55,406 46,758
Gross profit 35,044 33,789 66,832 61,499
Gross margin % 54.6 % 57.7 % 54.7 % 56.8 %
Operating expenses:
Sales and marketing 27,001 18,410 51,945 33,478
Research and development 6,859 4,850 13,358 8,962
General and administrative 11,248 8,461 24,750 15,826
Total operating expenses 45,108 31,721 90,053 58,266
(Loss) income from operations (10,064) 2,068 (23,221) 3,233
Interest and other income expense, net
Amortization of debt issuance costs (298) (215) (517) (267)
Interest on convertible notes (1,149) (778) (1,927) (969)
Loss on extinguishment of convertible notes (34,423) - (34,423) -
Gain on extinguishment of PPP loan - 7,185 - 7,185
Other expense, net (1,528) (392) (2,283) (1,415)
Loss before income taxes (47,462) 7,868 (62,371) 7,767
Income tax expense (186) 122 47 380
Net loss $ (47,276) $ 7,746 $ (62,418) $ 7,387
Net income (loss) per share:
Basic $ (2.53) $ 0.43 $ (3.39) $ 0.41
Diluted $ (2.53) $ 0.39 $ (3.39) $ 0.40
Weighted-average number of shares used in per share calculations:
Basic 18,700 17,862 18,392 17,815
Diluted 18,700 22,453 18,392 20,855



CUTERA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended Six Months Ended
June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021
Cash flows from operating activities:
Net loss $ (47,276) $ 7,746 $ (62,418) $ 7,387
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Stock-based compensation 4,733 2,919 8,776 4,765
Depreciation and amortization 502 346 929 707
Amortization of contract acquisition costs 567 458 1,219 1,003
Amortization of debt issuance costs 298 215 517 267
Impairment of capitalized cloud computing costs - - - 182
Change in deferred tax asset 39 6 80 51
Provision for excess and obsolete inventories 200 506 558 699
Provision for credit losses 217 274 409 492
Loss (gain) on sale of property and equipment 49 (23) 63 (82)
PPP loan forgiveness - (7,185) - (7,185)
Change in right-of-use asset 670 - 1,308 604
Loss on extinguishment of convertible notes
34,423 - 34,423 -
Changes in assets and liabilities:
Accounts receivable, net 804 (2,026) (1,108) (4,433)
Inventories, net (5,524) (443) (18,059) (6,657)
Other current assets and prepaid expenses 2,577 1,483 (3,034) (77)
Other long-term assets (686) (1,220) (1,071) (1,720)
Accounts payable 9,016 1,179 14,771 (474)
Accrued liabilities (889) (369) (6,878) 9,653
Operating lease liabilities (664) 33 (1,272) (530)
Deferred revenue 463 (334) 702 166
Net cash (used in) provided by operating activities (481) 3,565 (30,085) 4,818
Cash flows from investing activities:
Acquisition of property, equipment and software (7,917) (269) (8,238) (370)
Disposal of property and equipment - 19 - 71
Purchase of marketable investments (129,251) - (203,309) -
Net cash used in investing activities (137,168) (250) (211,547) (299)
Cash flows from financing activities:
Proceeds from exercise of stock options and employee stock purchase plan 1,288 1,501 1,440 1,897
Purchase of capped call (31,671) - (31,671) (16,134)
Proceeds from issuance of convertible notes 240,000 - 240,000 138,250
Payment of issuance costs of convertible notes (6,956) - (6,956) (4,717)
Extinguishment of convertible notes (45,777) - (45,777) -
Taxes paid related to net share settlement of equity awards (1,784) (452) (4,234) (1,451)
Payments on finance lease obligations (133) (96) (284) (211)
Net cash (used in) provided by financing activities 154,967 953 152,518 117,634
Net (decrease) increase in cash, cash equivalents and restricted cash 17,318 4,268 (89,114) 122,153
Cash, cash equivalents, and restricted cash at beginning of period 58,432 164,932 164,864 47,047
Cash, cash equivalents, and restricted cash at end of period $ 75,750 $ 169,200 $ 75,750 $ 169,200


CUTERA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(in thousands, except percentage data)
(unaudited)
Three Months Ended % Change Six Months Ended % Change
June 30, 2022 June 30, 2021 2022 Vs
2021
June 30, 2022 June 30, 2021 2022 Vs
2021
Revenue By Geography:
North America $ 32,239 $ 26,786 +20.4 % $ 61,092 $ 49,084 +24.5 %
Japan 15,174 17,421 (12.9) % 32,677 33,976 (3.8) %
Rest of World 16,811 14,382 +16.9 % 28,469 25,197 +13.0 %
Total Net Revenue $ 64,224 $ 58,589 +9.6 % $ 122,238 $ 108,257 +12.9 %
Rest of World (including Japan) as a percentage of total revenue 49.8 % 54.3 % 50.0 % 54.7 %
Revenue By Product Category:
Systems
-North America
$ 25,232 $ 19,888 +26.9 % $ 47,939 $ 36,673 +30.7 %
-Rest of World (including Japan)
18,421 15,680 +17.5 % 32,228 27,215 +18.4 %
Total Systems 43,653 35,568 +22.7 % 80,167 63,888 +25.5 %
Consumables 5,298 4,432 +19.5 % 9,201 7,357 +25.1 %
Skincare 9,638 11,812 (18.4) % 21,287 24,118 (11.7) %
Total Products 58,589 51,812 +13.1 % 110,655 95,363 +16.0 %
Service 5,635 6,777 (16.9) % 11,583 12,894 (10.2) %
Total Net Revenue $ 64,224 $ 58,589 +9.6 % $ 122,238 $ 108,257 +12.9 %

Three Months Ended Six Months Ended
June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021
Pre-tax Stock-Based Compensation Expense:
Cost of revenue $ 500 $ 434 $ 959 $ 578
Sales and marketing 1,638 522 2,214 1,243
Research and development 1,067 307 2,047 608
General and administrative 1,528 1,656 3,556 2,336
$ 4,733 $ 2,919 $ 8,776 $ 4,765



CUTERA, INC.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended June 30, 2022
GAAP Depreciation
and
Amortization
Stock-Based
Compensation
ERP Implementation Legal - Lutronic Loss on Extinguishment of Convertible Notes Non-GAAP
Net revenue $ 64,224 - - - - - $ 64,224
Cost of revenue 29,180 (161) (500) - - - 28,519
Gross profit 35,044 161 500 - - - 35,705
Gross margin % 54.6 % 55.6 %
Operating expenses:
Sales and marketing 27,001 (793) (1,638) - - - 24,570
Research and development 6,859 (68) (1,067) - - - 5,724
General and administrative 11,248 (46) (1,528) (2,385) (242) - 7,047
Total operating expenses 45,108 (907) (4,233) (2,385) (242) - 37,341
(Loss) income from operations (10,064) 1,068 - 2,385 242 - (1,636)
Interest and other expense, net
Amortization of debt issuance costs (298) - - - - - (298)
Interest on convertible notes (1,149) - - - - - (1,149)
Loss on extinguishment of convertible notes (34,423) - - - - 34,423 -
Other expense (1,528) - - - - - (1,528)
Total interest and other expense, net (37,398) - - - - 34,423 (2,975)
(Loss) income before income taxes (47,462) 1,068 4,733 2,385 242 34,423 (4,611)
Provision for income taxes (186) - - - - - (186)
Net (loss) income $ (47,276) $ 1,068 $ 4,733 $ 2,385 $ 242 $ 34,423 $ (4,425)
Net (loss) income per share:
Basic $ (2.53) $ (0.24)
Weighted-average number of shares used in per share calculations:
Basic 18,700 18,700
Operating expenses as a % of net revenue GAAP Non-GAAP
Sales and marketing 42.0 % 38.3 %
Research and development 10.7 % 8.9 %
General and administrative 17.5 % 11.0 %
70.2 % 58.2 %


CUTERA, INC.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended June 30, 2021
GAAP Depreciation
and
Amortization
Stock-Based
Compensation
CRM and ERP Implementation Severance (RIF) Legal - Lutronic Other Adjustments Non-GAAP
Net revenue $ 58,589 - - - - - - $ 58,589
Cost of revenue 24,800 (138) (434) - - - 346 24,574
Gross profit 33,789 138 434 - - - (346) 34,015
Gross margin % 57.7 % 58.1 %
Operating expenses:
Sales and marketing 18,410 (600) (522) - (638) - - 16,650
Research and development 4,850 (45) (307) - - - - 4,498
General and administrative 8,461 (21) (1,656) (407) - (290) - 6,087
Total operating expenses 31,721 (666) (2,485) (407) (638) (290) - 27,235
(Loss) income from operations 2,068 804 2,919 407 638 290 (346) 6,780
Interest and other expense, net
Amortization of debt issuance costs (215) - - - - - - (215)
Interest on Convertible notes (778) - - - - - - (778)
Gain on extinguishment of PPP loan 7,185 - - - - - (7,185) -
Other expense (392) - - - - - - (392)
Total interest and other expense, net 5,800 - - - - (7,185) (1,385)
(Loss) income before income taxes 7,868 804 2,919 407 638 290 (7,531) 5,395
Provision for income taxes 122 - - - - - - 122
Net (loss) income $ 7,746 $ 804 $ 2,919 $ 407 $ 638 $ 290 $ (7,531) $ 5,273
Net (loss) income per share:
Basic $ 0.43 $ 0.30
Weighted-average number of shares used in per share calculations:
Basic 17,862 17,862
Operating expenses as a % of net revenue GAAP Non-GAAP
Sales and marketing 31.4 % 28.4 %
Research and development 8.3 % 7.7 %
General and administrative 14.4 % 10.4 %
54.1 % 46.5 %


CUTERA, INC.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)

Six Months Ended June 30, 2022
GAAP Depreciation
and
Amortization
Stock-Based
Compensation
ERP Implementation Legal - Lutronic Loss on Extinguishment of Convertible Notes Non-GAAP
Net revenue $ 122,238 - - - - - $ 122,238
Cost of revenue 55,406 (237) (959) - - - 54,210
Gross profit 66,832 237 959 - - - 68,028
Gross margin % 54.7 % 55.7 %
Operating expenses:
Sales and marketing 51,945 (1,613) (2,214) - - - 48,118
Research and development 13,358 (113) (2,047) - - - 11,198
General and administrative 24,750 (184) (3,556) (6,361) (496) - 14,153
Total operating expenses 90,053 (1,910) (7,817) (6,361) (496) - 73,469
(Loss) income from operations (23,221) 2,147 8,776 6,361 496 - (5,441)
Interest and other expense, net
Amortization of debt issuance costs (517) - - - - - (517)
Interest on Convertible notes (1,927) - - - - - (1,927)
Loss on extinguishment of convertible notes (34,423) - - - - - 34,423 -
Other expense (2,283) - - - - - (2,283)
Total interest and other expense, net (39,150) - - - - 34,423 (4,727)
(Loss) income before income taxes (62,371) 2,147 8,776 6,361 496 34,423 (10,168)
Provision for income taxes 47 - - - - - 47
Net (loss) income $(62,418) $2,147 $8,776 $6,361 $496 $34,423 $(10,215)
Net (loss) income per share:
Basic $(3.39) $(0.56)
Weighted-average number of shares used in per share calculations:
Basic 18,392 18,392
Operating expenses as a % of net revenue GAAP Non-GAAP
Sales and marketing 42.5 % 39.4 %
Research and development 10.9 % 9.2 %
General and administrative 20.2 % 11.6 %
73.6 % 60.2 %



CUTERA, INC.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)

Six Months Ended June 30, 2021
GAAP Depreciation
and
Amortization
Stock-Based
Compensation
CRM and ERP
Implementation
Severance (RIF) Legal - Lutronic Other Adjustments Non-GAAP
Net revenue $ 108,257 - - - - - - $ 108,257
Cost of revenue 46,758 (300) (578) - - - 346 46,226
Gross profit 61,499 300 578 - - - (346) 62,031
Gross margin % 56.8 % 57.3 %
Operating expenses:
Sales and marketing 33,478 (1,278) (1,243) (182) (638) - - 30,137
Research and development 8,962 (84) (608) - - - - 8,270
General and administrative 15,826 (48) (2,336) (477) - (691) - 12,274
Total operating expenses 58,266 (1,410) (4,187) (659) (638) (691) - 50,681
(Loss) income from operations 3,233 1,710 4,765 659 638 691 (346) 11,350
Interest and other expense, net
Amortization of debt issuance costs (267) - - - - - - (267)
Interest on Convertible notes (969) - - - - - - (969)
Gain on extinguishment of PPP loan 7,185 - - - - - (7,185) -
Other expense (1,415) - - - - - - (1,415)
Total interest and other expense, net 4,534 - - - - - (7,185) (2,651)
(Loss) income before income taxes 7,767 1,710 4,765 659 638 691 (7,531) 8,699
Provision for income taxes 380 - - - - - - 380
Net (loss) income $ 7,387 $ 1,710 $ 4,765 $ 659 $ 638 $ 691 $ (7,531) $ 8,319
Net (loss) income per share:
Basic $ 0.41 $ 0.47
Weighted-average number of shares used in per share calculations:
17,815 17,815
Operating expenses as a % of net revenue GAAP Non-GAAP
Sales and marketing 30.9 % 27.8 %
Research and development 8.3 % 7.6 %
General and administrative 14.6 % 11.3 %
53.8 % 46.8 %


CUTERA, INC.
RECONCILIATION OF LOSS TO ADJUSTED EBITDA
(in thousands)
(unaudited)
Three Months Ended Six Months Ended
June 30, 2022
Net Income $ (47,276) $ (62,418)
Adjustments:
Stock-based compensation 4,733 8,776
ERP implementation cost 2,385 6,361
Interest and other expense, net 37,398 39,150
Depreciation and amortization 1,068 2,147
Legal -Lutronic 242 496
Income tax (benefit) expense (186) 47
Total adjustments 45,640 56,977
Adjusted EBITDA $ (1,636) $ (5,441)

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Cutera Inc. published this content on 05 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 August 2022 15:55:04 UTC.