Netlist Inc (NLST) saw its loss narrow to $4.40 million, or $0.08 a share for the quarter ended Oct. 01, 2016. In the previous year period, the company reported a loss of $5.37 million, or $0.11 a share.
Revenue during the quarter surged 60.11 percent to $2.59 million from $1.62 million in the previous year period. Gross margin for the quarter contracted 114 basis points over the previous year period to 0.35 percent.
Operating loss for the quarter was $4.26 million, compared with an operating loss of $4.03 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at negative $3.84 million compared to negative $3.63 million in the prior year second quarter.
“During the third quarter we made significant progress in the execution of our strategic initiatives,” said C.K. Hong, chief executive officer of Netlist. “In August we introduced our HybriDIMM™ storage class memory solution and remain on track to bring this innovative product to market next year. In September we filed a complaint in the U.S. International Trade Commission against SK hynix for infringement of six of our patents covering billions of dollars of their high performance memory. In addition, we achieved year over year product revenue growth from a new base of OEM and data center customers. We believe that our actions in the quarter have set the stage for growth and diversification as we enter 2017.”
Working capital increases sharply
Netlist Inc has recorded an increase in the working capital over the last year. It stood at $16.37 million as at Oct. 01, 2016, up 11,188.28 percent or $16.22 million from $0.14 million on Sep. 26, 2015. Current ratio was at 3.70 as on Oct. 01, 2016, up from 1.01 on Sep. 26, 2015.
Cash conversion cycle (CCC) has decreased to 100 days for the quarter from 235 days for the last year period. Days sales outstanding were almost stable at 31 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 53 days for the quarter compared with 108 days for the previous year period. At the same time, days payable outstanding went down to 184 days for the quarter from 375 for the same period last year.
Debt increases substantially
Netlist Inc has witnessed an increase in total debt over the last one year. It stood at $14.32 million as on Oct. 01, 2016, up 89.17 percent or $6.75 million from $7.57 million on Sep. 26, 2015. Long-term debt stood at $14.14 million as on Oct. 01, 2016. Total debt was 61.70 percent of total assets as on Oct. 01, 2016, compared with 45.54 percent on Sep. 26, 2015. Debt to equity ratio was at 4.82 as on Oct. 01, 2016, down from 19.92 as on Sep. 26, 2015.
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