0001628280-20-003042.txt : 20200305 0001628280-20-003042.hdr.sgml : 20200305 20200305162154 ACCESSION NUMBER: 0001628280-20-003042 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20200305 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20200305 DATE AS OF CHANGE: 20200305 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMMERSION CORP CENTRAL INDEX KEY: 0001058811 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 943180138 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-38334 FILM NUMBER: 20691082 BUSINESS ADDRESS: STREET 1: 50 RIO ROBLES CITY: SAN JOSE STATE: CA ZIP: 95134 BUSINESS PHONE: 408-467-1900 MAIL ADDRESS: STREET 1: 50 RIO ROBLES CITY: SAN JOSE STATE: CA ZIP: 95134 FORMER COMPANY: FORMER CONFORMED NAME: IMMERSION HUMAN INTERFACE CORP DATE OF NAME CHANGE: 19980602 8-K 1 immr8-k12312019.htm 8-K Document


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): March 5, 2020

IMMERSION CORPORATION
(Exact name of registrant as specified in its charter)

Delaware
 
001-38334
 
94-3180138
(State or other jurisdiction
of incorporation)
 
(Commission
file number)
 
(I.R.S. Employer
Identification No.)
 
 
 
50 Rio Robles, San Jose, CA
 
95134
(Address of principal executive offices)
 
(Zip Code)

(408) 467-1900
(Registrant’s telephone number, including area code)

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 (see General Instruction A.2. below):

¨

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common Stock, $0.001 par value
IMMR
NASDAQ Global Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

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. ☐




Item 2.02 Results of Operations and Financial Condition.
On March 5, 2020, Immersion Corporation (the “Company”) issued a press release regarding financial results for the fourth quarter and year ended December 31, 2019. A copy of the press release is attached to this report as Exhibit 99.1, and the information in Exhibit 99.1 is incorporated herein by reference.
The information in Item 2.02 and Exhibit 99.1 in this Current Report on Form 8-K shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

Item 9.01 Financial Statements and Exhibits.
 
(d)
Exhibits.





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.
 
 
 
IMMERSION CORPORATION
Date:
March 5, 2020
By:
 /s/ AARON AKERMAN
 
 
 
 
Aaron Akerman
 
 
 
 
Chief Financial Officer
 



 EX-99.1 2 immr8-k1231019exhibit991.htm EXHIBIT 99.1 Exhibit


Exhibit 99.1
Investor Contact:
The Blueshirt Group
Jennifer Jarman
+1 415.217.5866
jennifer@blueshirtgroup.com


Immersion Corporation Reports Fourth Quarter 2019 Results
–
Achieved Positive GAAP Net Income
–
Revenue of $11.5 million up 5% over the comparable quarter last year
–
GAAP net income (loss) per share of $0.03 versus $(0.10) last year
–
Non-GAAP net income (loss) per share of $0.10 versus $(0.02) last year

SAN JOSE, Calif., March 5, 2020 -- Immersion Corporation (NASDAQ: IMMR), the leading developer and licensor of touch feedback technology, today reported financial results for the fourth quarter ended December 31, 2019.
“Immersion ended the year with a positive fourth quarter, with revenue of recurring nature up 24% over the prior year period, the further optimization of our cost structure, and the commencement of stock repurchases,” said Ramzi Haidamus, Immersion’s President and CEO. “We have made tremendous headway over the past year in carving a path to profitable growth and long-term value creation for the company. We are very excited and confident in our new strategic initiatives and are focused on executing across our plans while continuing to strengthen our organization.”
Fourth Quarter Financial Summary

•
Total revenues grew five percent to $11.5 million, compared to $10.9 million in the fourth quarter of 2018. Royalty and license revenues were $11.4 million, compared to $10.8 million in the fourth quarter of 2018.

•
GAAP net income was $979 thousand, or $0.03 per diluted share, compared to GAAP net loss of $3.1 million, or $0.10, in the fourth quarter of 2018.
 
•
Non-GAAP net income was $3.1 million, or $0.10 per diluted share, compared to non-GAAP net loss of $678 thousand, or $0.02, in the fourth quarter of 2018. (See attached table for a reconciliation of GAAP to non-GAAP financial measures.)

•
As of December 31, 2019, cash, cash equivalents and short-term investments totaled $89.5 million. During the fourth quarter, the company used $3.2 million in cash flow in operations and used approximately $2.7 million to purchase approximately 387 thousand shares of its common stock.

Fiscal Year 2019 Financial Summary

•
Revenues for 2019 were $36.0 million, compared to $111.0 million in 2018. Royalty and license revenues for 2019 totaled $35.6 million, compared to $110.6 million in 2018. Revenues for 2018 included a material fixed fee license agreement entered into in the first quarter of 2018.

•
Net loss for 2019 was $20.0 million, or $0.64 per diluted share, compared to net income of $54.3 million, or $1.73 per diluted share, for 2018.

•
Non-GAAP net loss for 2019 was $13.2 million, or $0.42 per diluted share, compared to non-GAAP net income for 2018 of $63.2 million, or $2.01 per diluted share. (See attached table for a reconciliation of GAAP to non-GAAP financial measures.)





Recent Business Highlights

•
Underlying its commitment to enhancing shareholder value, Immersion repurchased 975,298 shares of common stock from December 2019 to March 4, 2020 for an aggregate purchase price of $7,164,060.

•
Demonstrated the ability to incorporate a variety of haptic effects on a large touchscreen using a single piezoelectric actuator at the Consumer Electronics Show 2020. The reference design demonstrator showcased the use of advanced haptics to create realistic touch feedback for buttons, dials, switches, and textures in programmable automotive human-machine interfaces (HMIs).

•
Appointed Aaron Akerman as Chief Financial Officer. Akerman brings over 15 years of leadership experience in corporate finance, accounting, treasury, financial and strategic planning, and operations.

•
Signed an agreement with Continental, a leading international supplier of human-machine interface solutions for automobiles. The agreement renewal grants Continental access to Immersion’s advanced haptic technologies for its automotive interfaces.

•
Hosted an Analyst and Investor Day on November 18, 2019, providing an overview of the company’s new strategic initiatives. Archived links from the event are accessible as follows: slide presentation and audio webcast.


Outlook

While the specific impacts of the COVID-19 virus on its customers’ activities and shipment volumes is difficult to forecast, Immersion is accounting for broader variability in its 2020 outlook and is projecting total revenues for the year of $31 to $35 million. Non-GAAP net income per diluted share is anticipated to be in the range of $0.04 to $0.19.

Fourth Quarter Earnings Conference Call and Webcast

Immersion will host a conference call with company management today at 2:00 p.m. PT (5:00 p.m. ET) to discuss financial results for the fourth quarter ended December 31, 2019. To participate on the live call, analysts and investors should dial +1 800-367-2403 (conference ID: 9038518) at least ten minutes prior to the start of the call. A recorded webcast of the conference call will also be available for 90 days within the “News and Events” section of Immersion’s investor relations website at https://ir.immersion.com/news-and-events.

About Immersion
Immersion Corporation (NASDAQ: IMMR) is the leading innovator of touch feedback technology, also known as haptics. The company provides technology solutions for creating immersive and realistic experiences that enhance digital interactions by engaging users’ sense of touch. Immersion's technology has been adopted in more than 3 billion digital devices, and provides haptics in mobile, automotive, gaming, medical and consumer electronics products. Immersion is headquartered in San Jose, California with offices worldwide. Learn more at www.immersion.com.

Use of Non-GAAP Financial Measures
Immersion reports all financial information required in accordance with generally accepted accounting principles (GAAP), but it believes that evaluating its ongoing operating results may be difficult to understand if limited to reviewing only GAAP financial measures. Immersion discloses this non-GAAP information, such as Non-GAAP net income (loss) and Non-GAAP net income (loss) per diluted share because it is useful in understanding the company’s performance as it excludes certain non-cash expenses like stock-based compensation expense and other special charges, such as deferred tax assets valuation allowance and restructuring costs, that many investors feel may obscure the company’s true operating performance. Likewise, management uses these non-GAAP financial measures to manage and assess the profitability of its business. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under GAAP. The non-GAAP financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Such non-GAAP financial measures are reconciled to their closest GAAP financial measures in tables contained in this press release. The Company has not reconciled the non-GAAP financial measures guidance to the




corresponding GAAP measures on a forward-looking basis due to the uncertainty and the potential variability of many of the costs and expenses that may be incurred in the future. Accordingly, reconciliations of the Company’s forward-looking non-GAAP financial measures to the corresponding GAAP measures are not available without unreasonable effort.

Forward-looking Statements

This press release contains “forward-looking statements” that involve risks and uncertainties as well as assumptions that, if they never materialize or prove incorrect, could cause the results of Immersion Corporation and its consolidated subsidiaries to differ materially from those expressed or implied by such forward-looking statements.

All statements, other than the statements of historical fact, are statements that may be deemed forward-looking statements, including, but not limited to, statements regarding our belief that our revenue outlook for 2020 is anticipated to be in the range of $31 to $35 million, and our expectation that non-GAAP net income per diluted share is anticipated to be in the range of $0.04 and $0.19 for 2020. Immersion’s actual results might differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with Immersion’s business, which include, but are not limited to, the inability of Immersion to enter into new and renewed licensing arrangements with its existing licensees and additional third parties for its touch-enabling technologies, the loss of a major customer, potential and actual claims and proceedings, including litigation involving Immersion’s intellectual property, the ability of Immersion to protect and enforce its intellectual property rights, changes in patent law, companies choosing to implement haptics without Immersion’s software or a license to Immersion’s patents, the ability of Immersion to return to consistent profitability in the future, the inability of Immersion to retain or recruit necessary personnel and other factors. Many of these risks and uncertainties are beyond the control of Immersion.

For a more detailed discussion of these factors, and other factors that could cause actual results to vary materially, interested parties should review the risk factors listed in Immersion’s Annual Report on Form 10-K for 2018 and its most recent Quarterly Report on Form 10-Q which are on file with the U.S. Securities and Exchange Commission. The forward-looking statements in this press release reflect Immersion’s beliefs and predictions as of the date of this release. Except as required by law, Immersion disclaims any obligation to update these forward-looking statements as a result of financial, business, or any other developments occurring after the date of this release or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

Immersion, the Immersion logo and TouchSense are trademarks or registered trademarks of Immersion Corporation in the United States and other countries. All other trademarks are the property of their respective owners.

The use of the word “partner” or “partnership” in this press release does not mean a legal partner or legal partnership.

(IMMR - C)
###







Immersion Corporation
Condensed Consolidated Balance Sheets
(In thousands)
 
 
December 31, 2019
 
December 31, 2018
 
(1)
 
(1)
ASSETS
 
 
 
Cash and cash equivalents
$
86,478

 
$
110,988

Short-term investments
3,019

 
13,930

Accounts and other receivables
3,385

 
1,051

Prepaid expenses and other current assets
14,078

 
9,856

Total current assets
106,960

 
135,825

Property and equipment, net
1,226

 
2,343

Other assets
16,662

 
7,827

TOTAL ASSETS
$
124,848

 
$
145,995

LIABILITIES
 
 
 
Accounts payable
$
809

 
$
3,612

Accrued compensation
2,844

 
3,948

Other current liabilities
3,478

 
3,194

Deferred revenue
4,692

 
4,591

Total current liabilities
11,823

 
15,345

Long-term deferred revenue
25,952

 
30,203

Other long-term liabilities
3,316

 
787

TOTAL LIABILITIES
41,091

 
46,335

STOCKHOLDERS’ EQUITY
83,757

 
99,660

TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY
$
124,848

 
$
145,995

(1)
Derived from Immersion’s annual audited consolidated financial statements.





Immersion Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
 
 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2019
 
2018
 
2019
 
2018
 
(1)
 
(1)
 
(2)
 
(2)
Revenues:
 
 
 
 
 
 
 
Royalty and license
$
11,379

 
$
10,768

 
$
35,643

 
$
110,557

Development, services, and other
85

 
99

 
310

 
422

Total revenues
11,464

 
10,867

 
35,953

 
110,979

Costs and expenses:
 
 
 
 
 
 
 
Cost of revenues
53

 
28

 
170

 
218

Sales and marketing
1,550

 
1,664

 
6,426

 
6,118

Research and development
1,774

 
2,575

 
7,840

 
9,727

General and administrative
7,609

 
10,146

 
42,968

 
41,815

Total costs and expenses
10,986

 
14,413

 
57,404

 
57,878

Operating Income (loss)
478

 
(3,546
)
 
(21,451
)
 
53,101

Interest and other income (loss)
772

 
483

 
1,878

 
1,634

Income (loss) before provision for income taxes
1,250

 
(3,063
)
 
(19,573
)
 
54,735

Provision for income taxes
(271
)
 
(79
)
 
(471
)
 
(392
)
Net Income (loss)
979

 
(3,142
)
 
(20,044
)
 
54,343

Basic net income (loss) per share
$
0.03

 
$
(0.10
)
 
$
(0.64
)
 
$
1.78

Shares used in calculating basic net income (loss) per share
31,731

 
30,814

 
31,529

 
30,459

Diluted net income (loss) per share
0.03

 
(0.10
)
 
(0.64
)
 
1.73

Shares used in calculating diluted net income (loss) per share
31,904

 
30,814

 
31,529

 
31,407

(1) Unaudited quarterly financial data
(2) Derived from Immersion’s annual audited consolidated financial statements.





Immersion Corporation
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Net Income (Loss)
(In thousands, except per share amounts)
(Unaudited)
 
 
Three Months Ended
December 31,
 
Year Ended
December 31,
 
2019
 
2018
 
2019
 
2018
GAAP net income (loss)
$
979

 
$
(3,142
)
 
$
(20,044
)
 
$
54,343

Add: Provision for income taxes
271

 
79

 
471

 
392

Less: Non-GAAP provision for income taxes
(72
)
 
(35
)
 
(218
)
 
(213
)
Add: Stock-based compensation
1,093

 
2,420

 
5,464

 
8,686

Add: Restructuring
$
844

 
$
—

 
$
1,093

 
$
—

Non-GAAP net income (loss)
$
3,115

 
$
(678
)
 
$
(13,234
)
 
$
63,208

Non-GAAP net income (loss) per diluted share
$
0.10

 
$
(0.02
)
 
$
(0.42
)
 
$
2.01

Dilutive shares used in calculating Non-GAAP net income (loss) per share
31,904

 
30,814

 
31,529

 
31,407






Immersion Corporation
Disaggregated Revenue Information
(In thousands)
(Unaudited)


 
Three Months Ended December 31,
 
Years Ended
December 31,
 
2019
 
2018
 
2019
 
2018
Fixed fee license revenue
$
2,517

 
$
1,618

 
$
12,627

 
$
83,573

Per-Unit royalty revenue
8,862

 
9,150

 
23,016

 
26,984

Total royalty and license revenue
11,379

 
10,768

 
35,643

 
110,557

Development, services, and other revenue
85

 
99

 
310

 
422

Total revenues
$
11,464

 
$
10,867

 
$
35,953

 
$
110,979










Immersion Corporation
Revenue by Line of Business
(Unaudited)


 
Three Months Ended
December 31,
 
Years Ended
December 31,
 
2019
 
2018
 
2019
 
2018
Mobility
67
%
 
45
%
 
63
%
 
81
%
Gaming
6
%
 
14
%
 
16
%
 
5
%
Automotive
27
%
 
36
%
 
21
%
 
13
%
Medical
—
%
 
5
%
 
—
%
 
1
%








Immersion Corporation
Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses
(In thousands)
(Unaudited)

 
Three Months Ended
December 31,
 
Years Ended
December 31,
 
2019
 
2018
 
2019
 
2018
GAAP operating expenses
$
10,933

 
$
14,385

 
$
57,234

 
$
57,660

Adjustments to non-GAAP operating expenses:
 
 
 
 
 
 
 
Stock-based compensation expense - S&M
(247
)
 
(271
)
 
(947
)
 
(946
)
Stock-based compensation expense - R&D
(250
)
 
(566
)
 
(1,304
)
 
(1,948
)
Stock-based compensation expense - G&A
(596
)
 
(1,583
)
 
(3,213
)
 
(5,792
)
Depreciation and amortization expense
(702
)
 
(208
)
 
(1,290
)
 
(855
)
Non-GAAP operating expense
$
9,138

 
$
11,757

 
$
50,480

 
$
48,119