XPER Xperi Inc

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 06, 2024

 

 

Xperi Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-41486	83-4470363
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
2190 Gold Street
San Jose, California				95002
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: 408 519-9100

 

N/A

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		XPER		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On November 6, 2024, Xperi Inc. (the “Company”) announced its financial results for the third quarter ended September 30, 2024. A copy of the Company’s press release announcing these financial results and other information regarding its financial condition is furnished as Exhibit 99.1 to this Form 8-K.

 

The information in this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.		Description
99.1		Press Release dated November 6, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: November 6, 2024			Xperi Inc.
			By:		/s/ Robert Andersen
			Name:		Robert Andersen
			Title:		Chief Financial Officer

 

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Exhibit 99.1

 

FOR IMMEDIATE RELEASE

 

Xperi Inc. Announces Third Quarter 2024 Results

 

Approaching One Million Activated TiVo OS Smart TVs; On Track to Achieve Year-End Goal of Two Million Smart TVs

Awarded DTS AutoStage Video Win with a Japanese Car Company

Exceeded Year-End Target of 2.4M Video over Broadband Subscriber Households

Closed Perceive Asset Sale for Gross Proceeds of $80 Million in Cash

 

 

San Jose, Calif. (November 6, 2024) – Xperi Inc. (NYSE: XPER) (the “Company” or “Xperi”), an entertainment technology company that invents, develops, and delivers technologies that enable extraordinary experiences, today announced third quarter 2024 financial results for the three-month period ended September 30, 2024.

“With the Perceive transaction now closed, we are fully focused on entertainment-based solutions to grow our independent media platform and licensing businesses. Our TiVo OS Smart TV footprint is approaching one million units, and with accelerating partner activity we believe we remain on-track toward our year-end target of two million active connected devices,” said Jon Kirchner, chief executive officer of Xperi.

 

Mr. Kirchner continued, “Our innovation pipeline continues to yield exciting new product solutions, including those benefiting from our prior work in the AI space. As an example, we recently launched our award-winning, AI-driven DTS Clear Dialogue solution, which addresses a real-world problem for TV audiences – dialogue intelligibility. Lastly, and very importantly, our business transformation efforts have helped us drive operating leverage and deliver meaningful improvements in our profitability metrics, in line with the three-to-five-year targets that we announced in September of 2022.”

 

Financial Highlights

		Q3 FY24				Q3 FY23
GAAP Highlights ($ millions, except per share data)
Revenue		$	132.9			$	130.4		1
GAAP operating loss		$	(18.6	)		$	(31.1	)
GAAP net loss2		$	(16.8	)		$	(41.4	)
GAAP loss per share2		$	(0.37	)		$	(0.96	)
Non-GAAP3 Highlights ($ millions, except per share data)		Q3 FY24				Q3 FY23
Revenue		$	132.9			$	130.4		1
Non-GAAP operating income		$	24.5			$	4.3
Non-GAAP net income/(loss)2		$	23.3			$	(3.3	)
Non-GAAP earnings/(loss) per share2		$	0.51			$	(0.08	)
Non-GAAP adjusted EBITDA		$	31.4			$	9.3

1 The contribution from AutoSense and the related imaging business, which was divested on January 31, 2024, accounted for $5.3 million of revenue in Q3 2023.

2 Attributable to the Company.

3 For further information on supplemental non-GAAP metrics included in this press release, refer to the “Non-GAAP Financial Measures” description and “GAAP to Non-GAAP Reconciliations” provided in the financial statement tables.

Recent Key Operating Achievements

Media Platform

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Connected Car

Pay TV

Consumer Electronics

Perceive

Capital Allocation

Financial Outlook

 

The Company makes the following updates to the 2024 outlook ranges previously provided:

 

Category		Original Outlook		Revised Outlook
Revenue		$500M to $530M		$490M to $505M
Non-GAAP Adjusted EBITDA Margin1, 2		12% to 14%		14% to 16%

1 See discussion of “Non-GAAP Financial Measures” below.

2 With respect to Non-GAAP Adjusted EBITDA Margin, the Company has determined that it is unable to provide a quantitative reconciliation of this forward-looking non-GAAP measure to the most directly comparable forward-looking GAAP measure with a reasonable degree of confidence in its accuracy without unreasonable effort, as items including restructuring and impacts from discrete tax adjustments and tax law changes are inherently uncertain and depend on various factors, many of which are beyond the Company's control.
 

Conference Call Information

The Company will hold its third quarter 2024 earnings conference call at 2:00 PM Pacific Time (5:00 PM Eastern Time) on Wednesday, November 6, 2024. To access the call toll-free, please dial 1-888-596-4144, otherwise dial 1-646-968-2525. The

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conference ID is 5483252. All participants should dial in 15 minutes prior to the start of the call using the conference ID listed above. Alternatively, the call can be accessed via the following webcast link: Q3 2024 Earnings Call Webcast.

Safe Harbor Statement

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding: expectations regarding our future results of operations and financial position, margin expansion and overall growth, including, without limitation, expectations regarding acceleration of revenue in our key growth markets and Non-GAAP Adjusted EBITDA Margin growth, the deployment by third parties of their products that use our technology, objectives for future operations, and ongoing strategies and operating initiatives, including, without limitation, subscriber and device targets, expansion expectations, our media platform and licensing businesses growth, reduction of expenses, and net proceeds from the Perceive asset sale. These forward-looking statements are based on information available to the Company as of the date hereof, as well as the Company’s current expectations, assumptions, estimates and projections that involve risks and uncertainties. In some cases, you can identify forward-looking statements by the words “expect,” “anticipate,” “intend,” “plan,” “believe,” “could,” “seek,” “see,” “will,” “may,” “would,” “might,” “potentially,” “estimate,” “continue,” “target,” “goal,” and similar expressions or the negatives of these words or other comparable terminology that convey uncertainty of future events or outcomes. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements. These risks, uncertainties and other factors are described under the captions “Risk Factors” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (the “SEC”) and our other filings with the SEC from time to time. Any forward-looking statements speak only as of the date of this press release and are based on information available to the Company as of the date of this press release, and the Company does not assume any obligation to, and does not intend to, publicly provide revisions or updates to any forward-looking statements, whether as a result of new information, future developments or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws.

 

About Xperi Inc.

 

Xperi invents, develops, and delivers technologies that enable extraordinary experiences. Xperi technologies, delivered via its brands (DTS®, HD Radio™, TiVo®) are integrated into billions of consumer devices and media platforms worldwide, powering smart devices, connected cars and entertainment experiences, including IMAX® Enhanced, a certification and licensing program operated by IMAX Corporation and DTS, Inc. Xperi has created a unified ecosystem that reaches highly engaged consumers, driving increased value for partners, customers and consumers.

©2024 Xperi Inc. All Rights Reserved. Xperi, TiVo, DTS, HD Radio, DTS Play-Fi, and their respective logos are trademark(s) or registered trademark(s) of Xperi Inc. or its subsidiaries in the United States and other countries. IMAX is a registered trademark of IMAX Corporation. All other trademarks and content are the property of their respective owners.

Non-GAAP Financial Measures

In addition to disclosing financial results calculated in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), the Company’s press release contains non-GAAP financial measures, including Non-GAAP Operating Income/(Loss), Non-GAAP Net Income/(Loss) attributable to the Company, Non-GAAP Net Income/(Loss) Per Share attributable to the Company, Non-GAAP Adjusted EBITDA, and Non-GAAP Adjusted EBITDA Margin.

Non-GAAP Operating Income/(Loss) is defined as GAAP Operating Income/(Loss), less the impact of stock-based compensation, amortization of intangible assets, transaction and integration costs related to actual or planned acquisitions, financing, and divestitures; severance and retention costs; restructuring costs; separation costs; and other items not indicative of our ongoing operating performance.

Non-GAAP Net Income/(Loss) attributable to the Company is defined as GAAP Net Income/(Loss) attributable to the Company excluding the impact of stock-based compensation, amortization of intangible assets, transaction and integration costs related to actual or planned acquisitions, financing, and divestitures; severance and retention costs; restructuring costs; separation costs; and other items not indicative of our ongoing operating performance, and related tax effects for each adjustment. Non-GAAP Net Income/(Loss)

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Per Share attributable to the Company is defined as Non-GAAP Income/(Loss) attributable to the Company divided by diluted Non-GAAP weighted average shares outstanding.

Non-GAAP Adjusted EBITDA is defined as GAAP Net Income/(Loss), less the impact of interest expense, income taxes, stock-based compensation, depreciation expense, amortization of intangible assets, amortization of capitalized cloud computing costs, transaction and integration costs related to actual or planned acquisitions, financing, and divestitures; severance and retention costs; restructuring costs; separation costs; and other items not indicative of our ongoing operating performance. Non-GAAP Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue.

Management believes that the non-GAAP measures used in this press release provide investors with important perspectives into the Company’s ongoing business and financial performance and provide a better understanding of our core operating results reflecting our normal business operations. The non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP. Our use of non-GAAP financial measures has certain limitations in that the non-GAAP financial measures we use may not be directly comparable to those reported by other companies. For example, the terms used in this press release, such as adjusted EBITDA, do not have a standardized meaning. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of our performance in relation to other companies. We seek to compensate for the limitation of our non-GAAP presentation by providing a detailed reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures in the tables attached hereto. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures. All financial data is presented on a GAAP basis except where the Company indicates its presentation is on a non-GAAP basis.

Set forth below are reconciliations of the Company’s reported GAAP to non-GAAP financial measures.

 

Xperi Investor Contact:

Mike Iburg

VP, Investor Relations

+1 408-321-3827

ir@xperi.com

 

Media Contact:

Amy Brennan

Senior Director, Corporate Communications

+1 949-518-6846

amy.brennan@xperi.com

– Tables Follow –

SOURCE: XPERI INC.

XPER-E

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XPERI INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)

 

 

		Three Months Ended September 30,								Nine Months Ended September 30,
		2024				2023				2024				2023
Revenue		$	132,891			$	130,390			$	371,326			$	384,101
Operating expenses:
Cost of revenue, excluding depreciation and amortization of intangible assets			27,484				26,413				86,193				85,061
Research and development			53,627				56,436				149,189				166,993
Selling, general and administrative			56,483				59,620				165,938				173,893
Depreciation expense			2,918				4,248				9,780				12,543
Amortization expense			10,934				14,724				33,015				44,349
Impairment of long-lived assets			—				—				—				1,096
Total operating expenses			151,446				161,441				444,115				483,935
Operating loss			(18,555	)			(31,051	)			(72,789	)			(99,834	)
Interest and other income (expense), net			2,379				(580	)			4,711				2,186
Interest expense - debt			(756	)			(756	)			(2,252	)			(2,246	)
Gain on divestiture			—				—				22,934				—
Loss before taxes			(16,932	)			(32,387	)			(47,396	)			(99,894	)
Provision for income taxes			2,899				9,685				16,437				14,481
Net loss			(19,831	)			(42,072	)			(63,833	)			(114,375	)
Less: net loss attributable to noncontrolling interest			(3,026	)			(646	)			(3,609	)			(2,554	)
Net loss attributable to the Company		$	(16,805	)		$	(41,426	)		$	(60,224	)		$	(111,821	)
Net loss per share attributable to the Company - basic and diluted		$	(0.37	)		$	(0.96	)		$	(1.33	)		$	(2.61	)
Weighted-average number of shares used in net loss per share calculations - basic and diluted			45,683				43,316				45,180				42,774

 

 

 

 

 

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XPERI INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

 

 

		September 30, 2024				December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents		$	72,686			$	142,085
Accounts receivable, net			62,368				55,984
Unbilled contracts receivable, net			84,797				64,114
Prepaid expenses and other current assets			37,686				38,874
Assets held for sale			1,306				15,860
Total current assets			258,843				316,917
Note receivable, noncurrent			29,131				—
Deferred consideration from divestiture			6,530				—
Unbilled contracts receivable, noncurrent			40,877				18,231
Property and equipment, net			43,505				41,569
Operating lease right-of-use assets			31,070				39,900
Intangible assets, net			174,037				206,895
Deferred tax assets			5,060				5,093
Other noncurrent assets			26,944				32,781
Assets held for sale, noncurrent			171				12,249
Total assets		$	616,168			$	673,635
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable		$	19,308			$	20,849
Accrued liabilities			105,560				109,961
Deferred revenue			26,378				28,111
Short-term debt			50,000				—
Liabilities held for sale			67				6,191
Total current liabilities			201,313				165,112
Long-term debt			—				50,000
Deferred revenue, noncurrent			20,371				19,425
Operating lease liabilities, noncurrent			20,496				30,598
Deferred tax liabilities			7,016				6,983
Other noncurrent liabilities			11,143				4,577
Liabilities held for sale, noncurrent			6				9,805
Total liabilities			260,345				286,500
Equity:
Common stock			45				44
Additional paid-in capital			1,256,372				1,212,501
Accumulated other comprehensive loss			(3,337	)			(2,865	)
Accumulated deficit			(875,670	)			(805,448	)
Total Company stockholders’ equity			377,410				404,232
Noncontrolling interest			(21,587	)			(17,097	)
Total equity			355,823				387,135
Total liabilities and equity		$	616,168			$	673,635

 

 

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XPERI INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

		Nine Months Ended September 30,
		2024				2023
Cash flows from operating activities:
Net loss		$	(63,833	)		$	(114,375	)
Adjustments to reconcile net loss to net cash used in operating activities:
Gain from divestiture			(22,934	)			—
Depreciation of property and equipment			9,780				12,543
Amortization of intangible assets			33,015				44,349
Stock-based compensation expense			45,309				51,681
Impairment of long-lived assets			—				1,096
Deferred income taxes			66				(1,022	)
Other			(2,410	)			(162	)
Changes in operating assets and liabilities:
Accounts receivable			(8,554	)			188
Unbilled contracts receivable			(43,518	)			(13,556	)
Prepaid expenses and other assets			4,684				1,264
Accounts payable			(328	)			87
Accrued and other liabilities			(7,047	)			(3,229	)
Deferred revenue			(799	)			537
Net cash used in operating activities			(56,569	)			(20,599	)
Cash flows from investing activities:
Purchases of property and equipment			(3,304	)			(4,718	)
Capitalized internal-use software			(9,175	)			(4,714	)
Purchases of intangible assets			(157	)			(149	)
Net cash used in divestiture			(227	)			—
Net cash used in investing activities			(12,863	)			(9,581	)
Cash flows from financing activities:
Repurchases of common stock			(9,999	)			—
Proceeds from issuance of common stock under employee stock purchase plan			4,328				5,850
Withholding taxes related to net share settlement of equity awards			(6,645	)			(4,313	)
Net cash (used in) provided by financing activities			(12,316	)			1,537
Effect of exchange rate changes on cash and cash equivalents			—				46
Net decrease in cash and cash equivalents			(81,748	)			(28,597	)
Cash and cash equivalents at beginning of period (1)			154,434				160,127
Cash and cash equivalents at end of period		$	72,686			$	131,530

 

 

 

 

 

 

 

 

 

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XPERI INC.

GAAP TO NON-GAAP RECONCILIATIONS

(in thousands, except per share amounts)

(unaudited)

 

		Three Months Ended September 30,
		2024				2023
Reconciliation of net income (loss) attributable to the Company:
GAAP net loss attributable to the Company		$	(16,805	)		$	(41,426	)
Adjustments to GAAP net loss attributable to the Company:
Stock-based compensation(1)			15,249				17,622
Amortization of intangible assets			10,934				14,724
Transaction, separation, integration and restructuring related costs:
Transaction, separation, integration and restructuring costs(2)			7,961				1,904
Severance and retention(3)			9,184				1,149
Income tax adjustment(4)			(3,216	)			2,764
Non-GAAP net income (loss) attributable to the Company		$	23,307			$	(3,263	)
(1) Stock-based compensation included in above line items:
Cost of revenue, excluding depreciation and amortization of intangible assets		$	822			$	806
Research and development		$	5,225			$	6,584
Selling, general and administrative		$	9,202			$	10,232
(2) Transaction, separation, integration and restructuring costs included in above line items:
Cost of revenue, excluding depreciation and amortization of intangible assets		$	—			$	—
Research and development		$	4,324			$	—
Selling, general and administrative		$	3,384			$	1,904
Interest and other income (expense), net		$	253			$	—
(3) Severance and retention included in above line items:
Cost of revenue, excluding depreciation and amortization of intangible assets		$	542			$	—
Research and development		$	6,287			$	471
Selling, general and administrative		$	2,355			$	678
(4) The provision for income taxes is adjusted to reflect the net direct and indirect income tax effects of the various non-GAAP pretax adjustments.
Reconciliation of net income (loss) per share attributable to the Company:
GAAP net loss attributable to the Company		$	(0.37	)		$	(0.96	)
Adjustments to GAAP net loss per share attributable to the Company:
Stock-based compensation			0.33				0.41
Amortization of intangible assets			0.24				0.34
Transaction, separation, integration and restructuring related costs			0.38				0.07
Income tax adjustment			(0.07	)			0.06
Non-GAAP net income (loss) per share attributable to the Company		$	0.51			$	(0.08	)
GAAP weighted-average number of shares - basic and diluted			45,683				43,316
Non-GAAP weighted-average number of shares - diluted			45,837				43,316

 

 

 

 

 

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XPERI INC.

GAAP TO NON-GAAP RECONCILIATIONS

(in thousands)

(unaudited)

 

 

		Three Months Ended September 30,
		2024				2023
GAAP operating loss		$	(18,555	)		$	(31,051	)
Adjustments to GAAP operating loss:
Stock-based compensation			15,249				17,622
Amortization of intangible assets			10,934				14,724
Transaction, separation, integration and restructuring related costs:
Transaction, separation, integration and restructuring costs			7,708				1,904
Severance and retention			9,184				1,149
Non-GAAP operating income		$	24,520			$	4,348

 

 

 

 

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XPERI INC.

GAAP TO NON-GAAP RECONCILIATIONS

(in thousands)

(unaudited)

 

 

		Three Months Ended September 30,
		2024				2023
GAAP net loss		$	(19,831	)		$	(42,072	)
Adjustments to GAAP net loss:
Interest expense			1,123				770
Provision for income taxes			2,899				9,685
Stock-based compensation			15,249				17,622
Depreciation expense			2,918				4,248
Amortization of intangible assets			10,934				14,724
Amortization of capitalized cloud computing costs			1,003				1,316
Transaction, separation, integration and restructuring related costs:
Transaction, separation, integration and restructuring costs			7,961				1,904
Severance and retention			9,184				1,149
Non-GAAP Adjusted EBITDA		$	31,440			$	9,346
Non-GAAP Adjusted EBITDA Margin(1)			23.7	%			7.2	%
(1)Non-GAAP Adjusted EBITDA Margin is calculated by dividing Non-GAAP Adjusted EBITDA, derived as above, by the Company's total revenue, expressed as a percentage.

 

 

 

 

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v3.24.3

Document And Entity Information	Nov. 06, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 06, 2024
Entity Registrant Name	Xperi Inc.
Entity Central Index Key	0001788999
Entity Emerging Growth Company	true
Entity File Number	001-41486
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	83-4470363
Entity Address, Address Line One	2190 Gold Street
Entity Address, City or Town	San Jose
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95002
City Area Code	408
Local Phone Number	519-9100
Entity Information, Former Legal or Registered Name	N/A
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Ex Transition Period	false
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	XPER
Security Exchange Name	NYSE

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