Exhibit | Description of Exhibit | ||||
SHARKNINJA, INC. | ||||||||
By: | /s/ Pedro J. Lopez-Baldrich | |||||||
Date: November 9, 2023 | Name: Pedro J. Lopez-Baldrich | |||||||
Title: Chief Legal Officer |
Page | |||||
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 170,377 | $ | 192,890 | |||||||
Restricted cash | — | 25,880 | |||||||||
Accounts receivable, net(1) | 938,081 | 766,503 | |||||||||
Inventories | 792,195 | 548,588 | |||||||||
Prepaid expenses and other current assets(2) | 86,471 | 181,831 | |||||||||
Total current assets | 1,987,124 | 1,715,692 | |||||||||
Property and equipment, net | 149,250 | 137,341 | |||||||||
Operating lease right-of-use assets | 64,156 | 67,321 | |||||||||
Intangible assets, net | 481,754 | 492,709 | |||||||||
Goodwill | 833,972 | 840,148 | |||||||||
Deferred tax assets, noncurrent | — | 6,291 | |||||||||
Other assets, noncurrent | 48,983 | 35,389 | |||||||||
Total assets | $ | 3,565,239 | $ | 3,294,891 | |||||||
Liabilities and Shareholders’ Equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable(3) | $ | 646,697 | $ | 328,122 | |||||||
Accrued expenses and other current liabilities(4) | 451,400 | 552,023 | |||||||||
Tax payable | 2,615 | 1,581 | |||||||||
Current portion of long-term debt | 19,127 | 86,972 | |||||||||
Total current liabilities | 1,119,839 | 968,698 | |||||||||
Long-term debt | 785,443 | 349,169 | |||||||||
Operating lease liabilities, noncurrent | 62,616 | 61,779 | |||||||||
Deferred tax liabilities, noncurrent | 47,266 | 60,976 | |||||||||
Other liabilities, noncurrent | 27,730 | 25,980 | |||||||||
Total liabilities | 2,042,894 | 1,466,602 | |||||||||
Commitments and contingencies (Note 9) | |||||||||||
Shareholders’ equity: | |||||||||||
Ordinary shares, $0.0001 par value per share, 1,000,000,000 shares authorized and 138,982,872 shares issued and outstanding as of September 30, 2023 and December 31, 2022 | 14 | 14 | |||||||||
Additional paid-in capital | 959,248 | 941,206 | |||||||||
Retained earnings | 571,174 | 896,738 | |||||||||
Accumulated other comprehensive loss | (8,091) | (9,669) | |||||||||
Total shareholders’ equity | 1,522,345 | 1,828,289 | |||||||||
Total liabilities and shareholders’ equity | $ | 3,565,239 | $ | 3,294,891 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net sales(1) | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 | |||||||||||||||
Cost of sales(2) | 583,124 | 603,413 | 1,591,254 | 1,547,843 | |||||||||||||||||||
Gross profit | 487,493 | 343,484 | 1,284,957 | 986,877 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development(3) | 60,691 | 53,968 | 180,430 | 159,955 | |||||||||||||||||||
Sales and marketing | 207,599 | 133,137 | 568,035 | 405,319 | |||||||||||||||||||
General and administrative(4) | 124,655 | 47,299 | 263,682 | 154,035 | |||||||||||||||||||
Total operating expenses | 392,945 | 234,404 | 1,012,147 | 719,309 | |||||||||||||||||||
Operating income | 94,548 | 109,080 | 272,810 | 267,568 | |||||||||||||||||||
Interest expense, net | (13,003) | (8,479) | (28,523) | (18,561) | |||||||||||||||||||
Other (expense) income, net | (5,865) | 2,033 | (41,315) | (8,841) | |||||||||||||||||||
Income before income taxes | 75,680 | 102,634 | 202,972 | 240,166 | |||||||||||||||||||
Provision for income taxes | 56,958 | 22,325 | 85,218 | 54,451 | |||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Net income per share, basic | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 | |||||||||||||||
Net income per share, diluted | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 | |||||||||||||||
Weighted-average number of shares used in computing net income per share, basic | 139,073,181 | 138,982,872 | 139,059,206 | 138,982,872 | |||||||||||||||||||
Weighted-average number of shares used in computing net income per share, diluted | 139,430,805 | 138,982,872 | 139,179,724 | 138,982,872 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
Foreign currency translation adjustments | (12,380) | (15,885) | (3,967) | (35,742) | |||||||||||||||||||
Unrealized gain on derivative instruments, net | 14,486 | — | 5,545 | — | |||||||||||||||||||
Comprehensive income | $ | 20,828 | $ | 64,424 | $ | 119,332 | $ | 149,973 |
Three Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | Total Shareholders' Equity | ||||||||||||||||||||||||||||||||||
Ordinary shares | Retained Earnings | ||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||
Balance as of June 30,2023 | 138,982,872 | $ | 14 | $ | 941,206 | $ | 935,487 | $ | (10,197) | $ | 1,866,510 | ||||||||||||||||||||||||
Share-based compensation | — | — | 21,337 | — | — | 21,337 | |||||||||||||||||||||||||||||
Distribution paid to Former Parent | — | — | — | (383,035) | — | (383,035) | |||||||||||||||||||||||||||||
Sale of SharkNinja Co, Ltd. to Former Parent | — | — | (3,295) | — | — | (3,295) | |||||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | 2,106 | 2,106 | |||||||||||||||||||||||||||||
Net income | — | — | — | 18,722 | — | 18,722 | |||||||||||||||||||||||||||||
Balance as of September 30, 2023 | 138,982,872 | $ | 14 | $ | 959,248 | $ | 571,174 | $ | (8,091) | $ | 1,522,345 |
Three Months Ended September 30, 2022 | |||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Loss | |||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | Total Shareholders' Equity | ||||||||||||||||||||||||||||||||||
Ordinary shares | Retained Earnings | ||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||
Balance as of June 30,2022 | 138,982,872 | $ | 14 | $ | 943,577 | $ | 778,565 | $ | (10,909) | $ | 1,711,247 | ||||||||||||||||||||||||
Intercompany note to Former Parent (Note 10) | — | — | — | (8,283) | — | (8,283) | |||||||||||||||||||||||||||||
Share-based compensation | — | — | 969 | — | — | 969 | |||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | (15,885) | (15,885) | |||||||||||||||||||||||||||||
Net income | — | — | — | 80,309 | — | 80,309 | |||||||||||||||||||||||||||||
Balance as of September 30, 2022 | 138,982,872 | $ | 14 | $ | 944,546 | $ | 850,591 | $ | (26,794) | $ | 1,768,357 |
Nine Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | Total Shareholders' Equity | ||||||||||||||||||||||||||||||||||
Ordinary shares | Retained Earnings | ||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||
Balance as of December 31, 2022 | 138,982,872 | $ | 14 | $ | 941,206 | $ | 896,738 | $ | (9,669) | $ | 1,828,289 | ||||||||||||||||||||||||
Distribution paid to Former Parent | — | — | — | (443,318) | — | (443,318) | |||||||||||||||||||||||||||||
Share-based compensation | — | — | 24,502 | — | — | 24,502 | |||||||||||||||||||||||||||||
Recharge from Former Parent for share-based compensation | — | — | (3,165) | — | — | (3,165) | |||||||||||||||||||||||||||||
Sale of SharkNinja Co, Ltd. to Former Parent | — | — | (3,295) | — | — | (3,295) | |||||||||||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | 1,578 | 1,578 | |||||||||||||||||||||||||||||
Net income | — | — | — | 117,754 | — | 117,754 | |||||||||||||||||||||||||||||
Balance as of September 30, 2023 | 138,982,872 | $ | 14 | $ | 959,248 | $ | 571,174 | $ | (8,091) | $ | 1,522,345 |
Nine Months Ended September 30, 2022 | |||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | Total Shareholders' Equity | ||||||||||||||||||||||||||||||||||
Ordinary shares | Retained Earnings | ||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||
Balance as of December 31, 2021 | 138,928,872 | $ | 14 | $ | 954,431 | $ | 797,970 | $ | 8,948 | $ | 1,761,363 | ||||||||||||||||||||||||
Distribution paid to Former Parent | — | — | — | (83,450) | — | (83,450) | |||||||||||||||||||||||||||||
Intercompany note to Former Parent (Note 10) | — | — | — | (49,644) | — | (49,644) | |||||||||||||||||||||||||||||
Share-based compensation | — | — | 5,415 | — | — | 5,415 | |||||||||||||||||||||||||||||
Recharge from Former Parent for share-based compensation | — | — | (15,300) | — | — | (15,300) | |||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | (35,742) | (35,742) | |||||||||||||||||||||||||||||
Net income | — | — | — | 185,715 | — | 185,715 | |||||||||||||||||||||||||||||
Balance as of September 30, 2022 | 138,928,872 | $ | 14 | $ | 944,546 | $ | 850,591 | $ | (26,794) | $ | 1,768,357 | ||||||||||||||||||||||||
SHARKNINJA, INC. | |||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
(in thousands) | |||||||||||
(unaudited) | |||||||||||
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | 117,754 | $ | 185,715 | |||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||||||
Depreciation and amortization | 77,394 | 61,560 | |||||||||
Share-based compensation | 24,502 | 5,415 | |||||||||
Provision for credit losses | 2,266 | 1,149 | |||||||||
Non-cash lease expense | 9,688 | 12,318 | |||||||||
Amortization of debt discount | 694 | 700 | |||||||||
Loss on extinguishment of debt | 968 | — | |||||||||
Deferred income taxes, net | 3,905 | (13,620) | |||||||||
Loss from equity method investment | — | 361 | |||||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable(1) | (192,209) | 137,191 | |||||||||
Inventories | (258,982) | (86,068) | |||||||||
Prepaid expenses and other assets(2) | 65,508 | (104,114) | |||||||||
Accounts payable(3) | 343,603 | (93,877) | |||||||||
Tax payable | 883 | 18,308 | |||||||||
Operating lease liabilities | (9,280) | (11,603) | |||||||||
Accrued expenses and other liabilities(4) | (90,914) | (74,006) | |||||||||
Net cash provided by operating activities | 95,780 | 39,429 | |||||||||
Cash flows from investing activities: | |||||||||||
Purchase of property and equipment | (70,501) | (52,872) | |||||||||
Purchase of intangible asset | (6,905) | (4,919) | |||||||||
Capitalized internal-use software development | (683) | (4,986) | |||||||||
Cash receipts on beneficial interest in sold receivables | 16,777 | — | |||||||||
Investment in equity method investment | — | (361) | |||||||||
Other investing activities, net | (3,051) | (300) | |||||||||
Net cash used in investing activities | (64,363) | (63,438) | |||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
SHARKNINJA, INC. | |||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
(continued) | |||||||||||
(in thousands) | |||||||||||
(unaudited) | |||||||||||
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from issuance of debt, net of issuance cost | 800,915 | 259,895 | |||||||||
Repayment of debt | (437,500) | (155,000) | |||||||||
Intercompany note to Former Parent (Note 10) | — | (49,286) | |||||||||
Distribution paid to Former Parent | (435,292) | (45,438) | |||||||||
Recharge from Former Parent for share-based compensation | (3,165) | (15,300) | |||||||||
Net cash used in financing activities | (75,042) | (5,129) | |||||||||
Effect of exchange rates changes on cash | (4,768) | (11,782) | |||||||||
Net decrease in cash, cash equivalents, and restricted cash | (48,393) | (40,920) | |||||||||
Cash, cash equivalents, and restricted cash at beginning of period | 218,770 | 240,597 | |||||||||
Cash, cash equivalents, and restricted cash at end of period | $ | 170,377 | $ | 199,677 | |||||||
Supplemental disclosures of noncash investing and financing activities: | |||||||||||
Purchase of property and equipment accrued and not yet paid | $ | 408 | $ | 480 | |||||||
Cancellation of related party note through distribution | (8,026) | — | |||||||||
Unrealized loss on cash flow hedges | 5,725 | — | |||||||||
Reconciliation of cash, cash equivalents and restricted cash within the Condensed Consolidated Balance Sheets to the amounts shown in the Condensed Consolidated Statements of Cash Flows above: | |||||||||||
Cash and cash equivalents | $ | 170,377 | $ | 181,950 | |||||||
Restricted cash | — | 17,727 | |||||||||
Total cash, cash equivalents and restricted cash | $ | 170,377 | $ | 199,677 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
Customer A | 21.4 | % | 15.1 | % | |||||||
Customer B | 10.0 | * | |||||||||
Customer C | 13.0 | 19.8 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Customer A | 19.2 | % | 18.5 | % | 18.9 | % | 18.6 | % | |||||||||||||||
Customer B | * | 10.5 | * | 11.3 | |||||||||||||||||||
Customer C | 15.2 | 14.1 | 15.0 | 14.8 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Beginning balance | $ | 6,926 | $ | 960 | $ | 6,998 | $ | 1,783 | |||||||||||||||
Provision for credit losses | 1,048 | 202 | 2,266 | 1,149 | |||||||||||||||||||
Write-offs and other adjustments | (1,328) | (212) | (2,618) | (1,982) | |||||||||||||||||||
Ending balance | $ | 6,646 | $ | 950 | $ | 6,646 | $ | 950 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
Beginning balance | $ | 22,294 | $ | — | |||||||
Non-cash addition to DPP receivable | — | 64,710 | |||||||||
Cash collected on DPP receivable | (16,777) | (42,416) | |||||||||
Non-cash adjustments | (5,517) | — | |||||||||
Ending balance | $ | — | $ | 22,294 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | ||||||||||||||||||||||||||||||||||||||||
(in thousands, except percentages) | |||||||||||||||||||||||||||||||||||||||||||||||
North America(1) | $ | 797,344 | 74.5 | % | $ | 778,044 | 82.2 | % | $ | 2,044,986 | 71.1 | % | $ | 2,021,574 | 79.7 | % | |||||||||||||||||||||||||||||||
Europe(2) | 236,461 | 22.1 | 127,717 | 13.5 | 692,191 | 24.1 | 389,724 | 15.4 | |||||||||||||||||||||||||||||||||||||||
Rest of World | 36,812 | 3.4 | 41,136 | 4.3 | 139,034 | 4.8 | 123,422 | 4.9 | |||||||||||||||||||||||||||||||||||||||
Total net sales | $ | 1,070,617 | 100.0 | % | $ | 946,897 | 100.0 | % | $ | 2,876,211 | 100.0 | % | $ | 2,534,720 | 100.0 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | ||||||||||||||||||||||||||||||||||||||||
(in thousands, except percentages) | |||||||||||||||||||||||||||||||||||||||||||||||
Shark | $ | 519,828 | 48.6 | % | $ | 525,204 | 55.5 | % | $ | 1,464,466 | 50.9 | % | $ | 1,410,731 | 55.7 | % | |||||||||||||||||||||||||||||||
Ninja | 550,789 | 51.4 | 421,693 | 44.5 | 1,411,745 | 49.1 | 1,123,989 | 44.3 | |||||||||||||||||||||||||||||||||||||||
Total net sales | $ | 1,070,617 | 100.0 | % | $ | 946,897 | 100.0 | % | $ | 2,876,211 | 100.0 | % | $ | 2,534,720 | 100.0 | % | |||||||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | Amount | Percentage of Net Sales | ||||||||||||||||||||||||||||||||||||||||
(in thousands, except percentages) | |||||||||||||||||||||||||||||||||||||||||||||||
Cleaning Appliances | $ | 449,319 | 42.0 | % | $ | 503,388 | 53.2 | % | $ | 1,277,986 | 44.4 | % | $ | 1,351,576 | 53.3 | % | |||||||||||||||||||||||||||||||
Cooking and Beverage Appliances | 339,328 | 31.7 | 260,438 | 27.5 | 939,060 | 32.7 | 696,568 | 27.5 | |||||||||||||||||||||||||||||||||||||||
Food Preparation Appliances | 211,461 | 19.7 | 161,256 | 17.0 | 472,685 | 16.4 | 427,422 | 16.9 | |||||||||||||||||||||||||||||||||||||||
Other | 70,509 | 6.6 | 21,815 | 2.3 | 186,480 | 6.5 | 59,154 | 2.3 | |||||||||||||||||||||||||||||||||||||||
Total net sales | $ | 1,070,617 | 100.0 | % | $ | 946,897 | 100.0 | % | $ | 2,876,211 | 100.0 | % | $ | 2,534,720 | 100.0 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Beginning balance | $ | 21,173 | $ | 14,466 | $ | 20,958 | $ | 17,828 | |||||||||||||||
Accruals for warranties issued | 17,738 | 4,643 | 31,488 | 12,700 | |||||||||||||||||||
Changes in liability for pre-existing warranties | (964) | — | (964) | 1,486 | |||||||||||||||||||
Settlements made | (13,621) | (6,155) | (27,156) | (19,060) | |||||||||||||||||||
Ending balance | $ | 24,326 | $ | 12,954 | $ | 24,326 | $ | 12,954 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
United States | $ | 60,941 | $ | 74,054 | |||||||
China | 78,213 | 55,170 | |||||||||
Rest of World | 10,096 | 8,117 | |||||||||
Total property and equipment, net | $ | 149,250 | $ | 137,341 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
Molds and tooling | $ | 261,403 | $ | 209,984 | |||||||
Computer and software | 96,317 | 88,483 | |||||||||
Displays | 84,719 | 90,722 | |||||||||
Equipment | 17,316 | 14,653 | |||||||||
Furniture and fixtures | 10,222 | 11,418 | |||||||||
Leasehold improvements | 34,977 | 31,315 | |||||||||
Total property and equipment | 504,954 | 446,575 | |||||||||
Less: accumulated depreciation and amortization | (369,476) | (322,022) | |||||||||
Construction in progress | 13,772 | 12,788 | |||||||||
Property and equipment, net | $ | 149,250 | $ | 137,341 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
Prepaid expenses | $ | 41,525 | $ | 86,274 | |||||||
Related party receivables | — | 20,069 | |||||||||
Derivative assets | 8,270 | 22,676 | |||||||||
DPP receivable | — | 22,294 | |||||||||
Other receivables | 36,676 | 30,518 | |||||||||
Prepaid expenses and other current assets | $ | 86,471 | $ | 181,831 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
Accrued customer incentives | $ | 146,031 | $ | 230,195 | |||||||
Accrued expenses | 118,754 | 99,962 | |||||||||
Accrued compensation and benefits | 61,487 | 71,762 | |||||||||
Accrued returns | 43,394 | 45,529 | |||||||||
Accrued tax payables | 14,696 | 43,243 | |||||||||
Accrued warranty | 24,326 | 20,958 | |||||||||
Operating lease liabilities, current | 9,449 | 13,038 | |||||||||
Derivative liabilities | 7,905 | — | |||||||||
Other | 25,358 | 27,336 | |||||||||
Accrued expenses and other current liabilities | $ | 451,400 | $ | 552,023 |
September 30, 2023 | |||||||||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Financial Assets: | |||||||||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||
Forward contracts included in prepaid expenses and other current assets (Note 6) | $ | 8,270 | $ | — | $ | 8,270 | $ | — | |||||||||||||||
Total financial assets | $ | 8,270 | $ | — | $ | 8,270 | $ | — | |||||||||||||||
Financial Liabilities: | |||||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||
Forward contracts included in accrued expenses and other current liabilities (Note 6) | $ | 7,905 | $ | — | $ | 7,905 | $ | — | |||||||||||||||
Total financial liabilities | $ | 7,905 | $ | — | $ | 7,905 | $ | — |
December 31, 2022 | |||||||||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Financial Assets: | |||||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||
Forward contracts included in prepaid expenses and other current assets (Note 6) | $ | 22,676 | $ | — | $ | 22,676 | $ | — | |||||||||||||||
DPP receivable included in prepaid expenses and other current assets (Note 2) | 22,294 | — | — | 22,294 | |||||||||||||||||||
Total financial assets | $ | 44,970 | $ | — | $ | 22,676 | $ | 22,294 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
Derivatives designated as hedging instruments: | |||||||||||
Forward contracts | $ | 330,900 | $ | — | |||||||
Derivatives not designated as hedging instruments: | |||||||||||
Forward contracts | 218,620 | 956,191 | |||||||||
Total derivative instruments | $ | 549,520 | $ | 956,191 |
Three Months Ended | Nine Months Ended | ||||||||||
September 30, 2023 | |||||||||||
(in thousands) | |||||||||||
Beginning balance | $ | (8,941) | $ | — | |||||||
Amount of net gains recorded in other comprehensive income | 15,698 | 5,607 | |||||||||
Amount of net gains reclassified from other comprehensive income to earnings | (1,212) | (62) | |||||||||
Ending balance | $ | 5,545 | $ | 5,545 |
Gross Carrying Value | Accumulated Amortization | Net Carrying Value | Weighted-Average Remaining Useful Life | ||||||||||||||||||||
(in thousands) | (in years) | ||||||||||||||||||||||
Intangible assets subject to amortization: | |||||||||||||||||||||||
Customer relationships | $ | 143,083 | $ | (95,389) | $ | 47,694 | 3.0 | ||||||||||||||||
Patents | 55,902 | (23,541) | 32,361 | 5.8 | |||||||||||||||||||
Developed technology | 22,094 | (5,035) | 17,059 | 8.4 | |||||||||||||||||||
Total intangible assets subject to amortization | $ | 221,079 | $ | (123,965) | $ | 97,114 | |||||||||||||||||
Intangible assets not subject to amortization: | |||||||||||||||||||||||
Trade name and trademarks | $ | 384,640 | $ | — | $ | 384,640 | Indefinite | ||||||||||||||||
Total intangible assets, net | $ | 605,719 | $ | (123,965) | $ | 481,754 |
Gross Carrying Value | Accumulated Amortization | Net Carrying Value | Weighted-Average Remaining Useful Life | ||||||||||||||||||||
(in thousands) | (in years) | ||||||||||||||||||||||
Intangible assets subject to amortization: | |||||||||||||||||||||||
Customer relationships | $ | 143,083 | $ | (83,465) | $ | 59,618 | 3.8 | ||||||||||||||||
Patents | 52,695 | (19,874) | 32,821 | 6.2 | |||||||||||||||||||
Developed technology | 21,381 | (5,151) | 16,230 | 9.2 | |||||||||||||||||||
Total intangible assets subject to amortization | $ | 217,159 | $ | (108,490) | $ | 108,669 | |||||||||||||||||
Intangible assets not subject to amortization: | |||||||||||||||||||||||
Trade name and trademarks | $ | 384,040 | $ | — | $ | 384,040 | Indefinite | ||||||||||||||||
Total intangible assets, net | $ | 601,199 | $ | (108,490) | $ | 492,709 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Research and development | $ | 1,632 | $ | 1,424 | $ | 4,918 | $ | 4,449 | |||||||||||||||
Sales and marketing | 3,975 | 3,975 | 11,924 | 11,924 | |||||||||||||||||||
Total amortization expenses | $ | 5,607 | $ | 5,399 | $ | 16,842 | $ | 16,373 |
Amount | |||||
(in thousands) | |||||
Years ending December 31, | |||||
Remainder of 2023 | $ | 6,205 | |||
2024 | 23,474 | ||||
2025 | 23,474 | ||||
2026 | 19,499 | ||||
2027 | 6,653 | ||||
Thereafter | 17,809 | ||||
Total | $ | 97,114 |
Carrying Amount | |||||
(in thousands) | |||||
Balance as of December 31, 2022 | $ | 840,148 | |||
Goodwill related to sale of SharkNinja Co, Ltd. (See Note 4) | (5,739) | ||||
Effect of foreign currency translation | (437) | ||||
Balance as of September 30, 2023 | $ | 833,972 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
2020 Term Loans with principal payments due on March 20 each year; interest at LIBOR plus 1.8%; final balance due on maturity date of March 19, 2025 | $ | — | $ | 437,500 | |||||||
2023 Term Loans with principal payments due quarterly; interest at SOFR plus 1.875%; final balance due on maturity date of July 20, 2028 | 810,000 | — | |||||||||
Less: deferred financing costs | (5,430) | (1,359) | |||||||||
Less: current portion | (19,127) | (86,972) | |||||||||
Long-term debt, net of current portion | $ | 785,443 | $ | 349,169 |
Amount | |||||
(in thousands) | |||||
Years ending December 31, | |||||
Remainder of 2023 | $ | 5,062 | |||
2024 | 25,313 | ||||
2025 | 40,500 | ||||
2026 | 40,500 | ||||
2027 | 40,500 | ||||
2028 | 658,125 | ||||
Total future principal payments | $ | 810,000 |
Number of Shares | Weighted Average Grant Date Fair Value per share | ||||||||||
Unvested as of December 31, 2022 | 10,254,734 | $ | 0.97 | ||||||||
Vested | (9,177,987) | 0.97 | |||||||||
Cancelled/Forfeited | (1,076,747) | 0.97 | |||||||||
Unvested as of September 30, 2023 | — | $ | — |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Research and development | $ | 3,160 | $ | 263 | $ | 4,229 | $ | 1,669 | |||||||||||||||
Sales and marketing | 1,920 | 115 | 2,432 | 451 | |||||||||||||||||||
General and administrative | 16,257 | 591 | 17,841 | 3,295 | |||||||||||||||||||
Total share-based compensation | $ | 21,337 | $ | 969 | $ | 24,502 | $ | 5,415 |
Stock price at valuation date | $ | — | |||
Expected volatility | 44.99 % to 47.62 % | ||||
Risk-free interest rate | 4.30 % to 5.07 % | ||||
Expected dividends | 0 | % | |||
Expected term (in years) | 1.48 to 4.01 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(in thousands, except share and per share data) | |||||||||||||||||||||||
Numerator: | |||||||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Denominator: | |||||||||||||||||||||||
Weighted-average shares used in computing net income per share, basic | 139,073,181 | 138,982,872 | 139,059,206 | 138,982,872 | |||||||||||||||||||
Dilutive effect of RSUs | 357,624 | — | 120,518 | — | |||||||||||||||||||
Weighted-average shares used in computing net income per share, diluted | 139,430,805 | 138,982,872 | 139,179,724 | 138,982,872 | |||||||||||||||||||
Net income per share, basic | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 | |||||||||||||||
Net income per share, diluted | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 |
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
(in thousands) | |||||||||||
Related party assets | |||||||||||
Balances and transactions with entities controlled by JS Global | |||||||||||
Accounts receivable, net | $ | 6,081 | $ | 1,033 | |||||||
Prepaid expenses and other current assets | — | 2,886 | |||||||||
Related party liabilities | |||||||||||
Balances and transactions with entities controlled by JS Global | |||||||||||
Accounts payable | $ | 112,131 | $ | 231,805 | |||||||
Accrued expenses and other current liabilities | — | 861 | |||||||||
Balances with JS Global | |||||||||||
Accrued expenses and other current liabilities | $ | — | $ | 7,538 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Related party revenue | |||||||||||||||||||||||
Balances and transactions with joint venture | |||||||||||||||||||||||
Sale of goods | $ | — | $ | — | $ | — | $ | 766 | |||||||||||||||
Balances and transactions with entities controlled by JS Global | |||||||||||||||||||||||
Sale of goods | $ | 13 | $ | 223 | $ | 1,264 | $ | 223 | |||||||||||||||
Sale of services | 1,275 | — | 1,275 | — | |||||||||||||||||||
Related party expense | |||||||||||||||||||||||
Balances and transactions with entities controlled by JS Global | |||||||||||||||||||||||
Purchase of goods | $ | 261,764 | $ | 361,909 | $ | 971,015 | $ | 1,045,553 | |||||||||||||||
Purchase of services | 808 | 712 | 2,573 | 2,513 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net sales | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 | |||||||||||||||
Cost of sales | 583,124 | 603,413 | 1,591,254 | 1,547,843 | |||||||||||||||||||
Gross profit | 487,493 | 343,484 | 1,284,957 | 986,877 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development(1) | 60,691 | 53,968 | 180,430 | 159,955 | |||||||||||||||||||
Sales and marketing(1) | 207,599 | 133,137 | 568,035 | 405,319 | |||||||||||||||||||
General and administrative(1) | 124,655 | 47,299 | 263,682 | 154,035 | |||||||||||||||||||
Total operating expenses | 392,945 | 234,404 | 1,012,147 | 719,309 | |||||||||||||||||||
Operating income | 94,548 | 109,080 | 272,810 | 267,568 | |||||||||||||||||||
Interest expense, net | (13,003) | (8,479) | (28,523) | (18,561) | |||||||||||||||||||
Other (expense) income, net | (5,865) | 2,033 | (41,315) | (8,841) | |||||||||||||||||||
Income before income taxes | 75,680 | 102,634 | 202,972 | 240,166 | |||||||||||||||||||
Provision for income taxes | 56,958 | 22,325 | 85,218 | 54,451 | |||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Research and development | $ | 3,160 | $ | 263 | $ | 4,229 | $ | 1,669 | |||||||||||||||
Sales and marketing | 1,920 | 115 | 2,432 | 451 | |||||||||||||||||||
General and administrative | 16,257 | 591 | 17,841 | 3,295 | |||||||||||||||||||
Total share-based compensation | $ | 21,337 | $ | 969 | $ | 24,502 | $ | 5,415 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net sales | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||
Cost of sales | 54.5 | 63.7 | 55.3 | 61.1 | |||||||||||||||||||
Gross profit | 45.5 | 36.3 | 44.7 | 38.9 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development | 5.7 | 5.7 | 6.3 | 6.3 | |||||||||||||||||||
Sales and marketing | 19.4 | 14.1 | 19.7 | 16.0 | |||||||||||||||||||
General and administrative | 11.6 | 5.0 | 9.2 | 6.1 | |||||||||||||||||||
Total operating expenses | 36.7 | 24.8 | 35.2 | 28.4 | |||||||||||||||||||
Operating income | 8.8 | 11.5 | 9.5 | 10.5 | |||||||||||||||||||
Interest expense, net | (1.2) | (0.9) | (1.0) | (0.7) | |||||||||||||||||||
Other (expense) income, net | (0.6) | 0.3 | (1.4) | (0.4) | |||||||||||||||||||
Income before income taxes | 7.0 | 10.9 | 7.1 | 9.4 | |||||||||||||||||||
Provision for income taxes | 5.3 | 2.4 | 3.0 | 2.1 | |||||||||||||||||||
Net income | 1.7 | % | 8.5 | % | 4.1 | % | 7.3 | % |
Three Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Net sales | $ | 1,070,617 | $ | 946,897 | $ | 123,720 | 13.1 | % |
Three Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Cleaning Appliances | $ | 449,319 | $ | 503,388 | $ | (54,069) | (10.7) | % | |||||||||||||||
Cooking and Beverage Appliances | 339,328 | 260,438 | 78,890 | 30.3 | |||||||||||||||||||
Food Preparation Appliances | 211,461 | 161,256 | 50,205 | 31.1 | |||||||||||||||||||
Other | 70,509 | 21,815 | 48,694 | 223.2 | |||||||||||||||||||
Total net sales | $ | 1,070,617 | $ | 946,897 | $ | 123,720 | 13.1 | % |
Three Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Gross profit | $ | 487,493 | $ | 343,484 | $ | 144,009 | 41.9 | % | |||||||||||||||
Gross margin | 45.5 | % | 36.3 | % |
Three Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Research and development | $ | 60,691 | $ | 53,968 | $ | 6,723 | 12.5 | % | |||||||||||||||
Percentage of net sales | 5.7 | % | 5.7 | % | |||||||||||||||||||
Selling and marketing | $ | 207,599 | $ | 133,137 | $ | 74,462 | 55.9 | % | |||||||||||||||
Percentage of net sales | 19.4 | % | 14.1 | % | |||||||||||||||||||
General and administration | $ | 124,655 | $ | 47,299 | $ | 77,356 | 163.5 | % | |||||||||||||||
Percentage of net sales | 11.6 | % | 5.0 | % | |||||||||||||||||||
Total operating expenses | $ | 392,945 | $ | 234,404 | $ | 158,541 | 67.6 | % | |||||||||||||||
Percentage of net sales | 36.7 | % | 24.8 | % |
Three Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Interest expense, net | $ | 13,003 | $ | 8,479 | $ | 4,524 | 53.4 | % | |||||||||||||||
Percentage of net sales | 1.2 | % | 0.9 | % |
Three Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Other (expense) income, net | $ | (5,865) | $ | 2,033 | $ | (7,898) | (388.5) | % | |||||||||||||||
Percentage of net sales | (0.6) | % | 0.3 | % |
Three Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Provision of income taxes | $ | 56,958 | $ | 22,325 | $ | 34,633 | 155.1 | % | |||||||||||||||
Percentage of income before income taxes | 75.3 | % | 21.8 | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Net sales | $ | 2,876,211 | $ | 2,534,720 | $ | 341,491 | 13.5 | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Cleaning Appliances | $ | 1,277,986 | $ | 1,351,576 | $ | (73,590) | (5.4) | % | |||||||||||||||
Cooking and Beverage Appliances | 939,060 | 696,568 | 242,492 | 34.8 | |||||||||||||||||||
Food Preparation Appliances | 472,685 | 427,422 | 45,263 | 10.6 | |||||||||||||||||||
Other | 186,480 | 59,154 | 127,326 | 215.2 | |||||||||||||||||||
Total net sales | $ | 2,876,211 | $ | 2,534,720 | $ | 341,491 | 13.5 | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Gross profit | $ | 1,284,957 | $ | 986,877 | $ | 298,080 | 30.2 | % | |||||||||||||||
Gross margin | 44.7 | % | 38.9 | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Research and development | $ | 180,430 | $ | 159,955 | $ | 20,475 | 12.8 | % | |||||||||||||||
Percentage of net sales | 6.3 | % | 6.3 | % | |||||||||||||||||||
Selling and marketing | $ | 568,035 | $ | 405,319 | $ | 162,716 | 40.1 | % | |||||||||||||||
Percentage of net sales | 19.7 | % | 16.0 | % | |||||||||||||||||||
General and administration | $ | 263,682 | $ | 154,035 | $ | 109,647 | 71.2 | % | |||||||||||||||
Percentage of net sales | 9.2 | % | 6.1 | % | |||||||||||||||||||
Total operating expenses | $ | 1,012,147 | $ | 719,309 | $ | 292,838 | 40.7 | % | |||||||||||||||
Percentage of net sales | 35.2 | % | 28.4 | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Interest expense, net | $ | 28,523 | $ | 18,561 | $ | 9,962 | 53.7 | % | |||||||||||||||
Percentage of net sales | 1.0 | % | 0.7 | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Other expense, net | $ | (41,315) | $ | (8,841) | $ | (32,474) | 367.3 | % | |||||||||||||||
Percentage of net sales | (1.4) | % | (0.4) | % |
Nine Months Ended September 30, | |||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | $ Change | % Change | |||||||||||||||||||
Provision of income taxes | $ | 85,218 | $ | 54,451 | $ | 30,767 | 56.5 | % | |||||||||||||||
Percentage of income before income taxes | 42.0 | % | 22.7 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net sales | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 | |||||||||||||||
Divested subsidiary adjustment(1) | (13,196) | (24,003) | (77,544) | (65,873) | |||||||||||||||||||
Adjusted Net Sales | $ | 1,057,421 | $ | 922,894 | $ | 2,798,667 | $ | 2,468,847 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net sales | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 | |||||||||||||||
Cost of sales | (583,124) | (603,413) | (1,591,254) | (1,547,843) | |||||||||||||||||||
Gross profit | 487,493 | 343,484 | 1,284,957 | 986,877 | |||||||||||||||||||
Gross margin % | 45.5 | % | 36.3 | % | 44.7 | % | 38.9 | % | |||||||||||||||
Divested subsidiary net sales adjustment (1) | (13,196) | (24,003) | (77,544) | (65,873) | |||||||||||||||||||
Divested subsidiary cost of sales adjustment(2) | 7,628 | 15,387 | 45,116 | 41,323 | |||||||||||||||||||
Product Procurement Adjustment(3) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Adjusted Gross Profit | $ | 505,499 | $ | 353,209 | $ | 1,305,898 | $ | 1,013,558 | |||||||||||||||
Adjusted Net Sales | $ | 1,057,421 | $ | 922,894 | $ | 2,798,667 | $ | 2,468,847 | |||||||||||||||
Adjusted Gross Margin | 47.8 | % | 38.3 | % | 46.7 | % | 41.1 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Operating income | $ | 94,548 | $ | 109,080 | $ | 272,810 | $ | 267,568 | |||||||||||||||
Share-based compensation(1) | 21,337 | 969 | 24,502 | 5,415 | |||||||||||||||||||
Litigation costs(2) | 3,965 | 19 | 4,600 | 4,024 | |||||||||||||||||||
Amortization of acquired intangible assets(3) | 4,897 | 4,897 | 14,690 | 14,691 | |||||||||||||||||||
Separation and distribution related costs(4) | 41,455 | 275 | 76,549 | 275 | |||||||||||||||||||
Product Procurement Adjustment(5) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Divested subsidiary operating income adjustment(6) | 287 | (1,668) | (8,456) | (4,811) | |||||||||||||||||||
Adjusted Operating Income | $ | 190,063 | $ | 131,913 | $ | 438,064 | $ | 338,393 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except share and per share amounts) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Share-based compensation(1) | 21,337 | 969 | 24,502 | 5,415 | |||||||||||||||||||
Litigation costs(2) | 3,965 | 19 | 4,600 | 4,024 | |||||||||||||||||||
Foreign currency losses (gains), net(3) | 3,862 | (839) | 43,479 | 11,783 | |||||||||||||||||||
Amortization of acquired intangible assets(4) | 4,897 | 4,897 | 14,690 | 14,691 | |||||||||||||||||||
Separation and distribution related costs(5) | 41,455 | 275 | 76,549 | 275 | |||||||||||||||||||
Product Procurement Adjustment(6) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Tax impact of adjusting items(7) | (4,704) | (5,206) | (30,686) | (19,232) | |||||||||||||||||||
Tax withholding adjustment(8) | 19,474 | — | 19,474 | — | |||||||||||||||||||
Divested subsidiary net income adjustment(9) | 394 | 479 | (6,586) | 1,055 | |||||||||||||||||||
Adjusted Net Income | $ | 132,976 | $ | 99,244 | $ | 317,145 | $ | 254,957 | |||||||||||||||
Net income per share, diluted | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 | |||||||||||||||
Adjusted Net Income Per Share | $ | 0.95 | $ | 0.71 | $ | 2.28 | $ | 1.83 | |||||||||||||||
Diluted weighted-average number of shares used in computing net income per share and Adjusted Net Income Per Share(10) | 139,430,805 | 138,982,872 | 139,179,724 | 138,982,872 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Interest expense, net | 13,003 | 8,479 | 28,523 | 18,561 | |||||||||||||||||||
Provision for income taxes | 56,958 | 22,325 | 85,218 | 54,451 | |||||||||||||||||||
Depreciation and amortization | 25,602 | 21,395 | 77,394 | 61,560 | |||||||||||||||||||
EBITDA | 114,285 | 132,508 | 308,889 | 320,287 | |||||||||||||||||||
Share-based compensation (1) | 21,337 | 969 | 24,502 | 5,415 | |||||||||||||||||||
Litigation costs (2) | 3,965 | 19 | 4,600 | 4,024 | |||||||||||||||||||
Foreign currency losses (gains), net(3) | 3,862 | (839) | 43,479 | 11,783 | |||||||||||||||||||
Separation and distribution related costs(4) | 41,455 | 275 | 76,549 | 275 | |||||||||||||||||||
Product Procurement Adjustment(5) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Divested subsidiary Adjusted EBITDA adjustment(6) | 264 | (459) | (11,020) | (1,800) | |||||||||||||||||||
Adjusted EBITDA | $ | 208,742 | $ | 150,814 | $ | 500,368 | $ | 391,215 | |||||||||||||||
Adjusted Net Sales | $ | 1,057,421 | $ | 922,894 | $ | 2,798,667 | $ | 2,468,847 | |||||||||||||||
Adjusted EBITDA Margin | 19.7 | % | 16.3 | % | 17.9 | % | 15.8 | % |
Nine Months Ended September 30, | |||||||||||
($ in thousands) | 2023 | 2022 | |||||||||
Net cash provided by operating activities | $ | 95,780 | $ | 39,429 | |||||||
Net cash used in investing activities | (64,363) | (63,438) | |||||||||
Net cash used in financing activities | (75,042) | (5,129) |
SHARKNINJA, INC. | |||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||||
(in thousands, except share and per share data) | |||||||||||
(unaudited) | |||||||||||
As of | |||||||||||
September 30, 2023 | December 31, 2022 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 170,377 | $ | 192,890 | |||||||
Restricted cash | — | 25,880 | |||||||||
Accounts receivable, net | 938,081 | 766,503 | |||||||||
Inventories | 792,195 | 548,588 | |||||||||
Prepaid expenses and other current assets | 86,471 | 181,831 | |||||||||
Total current assets | 1,987,124 | 1,715,692 | |||||||||
Property and equipment, net | 149,250 | 137,341 | |||||||||
Operating lease right-of-use assets | 64,156 | 67,321 | |||||||||
Intangible assets, net | 481,754 | 492,709 | |||||||||
Goodwill | 833,972 | 840,148 | |||||||||
Deferred tax assets, noncurrent | — | 6,291 | |||||||||
Other assets, noncurrent | 48,983 | 35,389 | |||||||||
Total assets | $ | 3,565,239 | $ | 3,294,891 | |||||||
Liabilities and Shareholders’ Equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 646,697 | $ | 328,122 | |||||||
Accrued expenses and other current liabilities | 451,400 | 552,023 | |||||||||
Tax payable | 2,615 | 1,581 | |||||||||
Current portion of long-term debt | 19,127 | 86,972 | |||||||||
Total current liabilities | 1,119,839 | 968,698 | |||||||||
Long-term debt | 785,443 | 349,169 | |||||||||
Operating lease liabilities, noncurrent | 62,616 | 61,779 | |||||||||
Deferred tax liabilities, noncurrent | 47,266 | 60,976 | |||||||||
Other liabilities, noncurrent | 27,730 | 25,980 | |||||||||
Total liabilities | 2,042,894 | 1,466,602 | |||||||||
Commitments and contingencies | |||||||||||
Shareholders’ equity: | |||||||||||
Ordinary shares, $0.0001 par value per share, 1,000,000,000 shares authorized and 138,982,872 shares issued and outstanding as of September 30, 2023 and December 31, 2022 | 14 | 14 | |||||||||
Additional paid-in capital | 959,248 | 941,206 | |||||||||
Retained earnings | 571,174 | 896,738 | |||||||||
Accumulated other comprehensive loss | (8,091) | (9,669) | |||||||||
Total shareholders’ equity | 1,522,345 | 1,828,289 | |||||||||
Total liabilities and shareholders’ equity | $ | 3,565,239 | $ | 3,294,891 |
SHARKNINJA, INC. | |||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||||||
(in thousands, except share and per share data) | |||||||||||||||||||||||
(unaudited) | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net sales(1) | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 | |||||||||||||||
Cost of sales | 583,124 | 603,413 | 1,591,254 | 1,547,843 | |||||||||||||||||||
Gross profit | 487,493 | 343,484 | 1,284,957 | 986,877 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development | 60,691 | 53,968 | 180,430 | 159,955 | |||||||||||||||||||
Sales and marketing | 207,599 | 133,137 | 568,035 | 405,319 | |||||||||||||||||||
General and administrative | 124,655 | 47,299 | 263,682 | 154,035 | |||||||||||||||||||
Total operating expenses | 392,945 | 234,404 | 1,012,147 | 719,309 | |||||||||||||||||||
Operating income | 94,548 | 109,080 | 272,810 | 267,568 | |||||||||||||||||||
Interest expense, net | (13,003) | (8,479) | (28,523) | (18,561) | |||||||||||||||||||
Other (expense) income, net | (5,865) | 2,033 | (41,315) | (8,841) | |||||||||||||||||||
Income before income taxes | 75,680 | 102,634 | 202,972 | 240,166 | |||||||||||||||||||
Provision for income taxes | 56,958 | 22,325 | 85,218 | 54,451 | |||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Net income per share, basic | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 | |||||||||||||||
Net income per share, diluted | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 | |||||||||||||||
Weighted-average number of shares used in computing net income per share, basic | 139,073,181 | 138,982,872 | 139,059,206 | 138,982,872 | |||||||||||||||||||
Weighted-average number of shares used in computing net income per share, diluted | 139,430,805 | 138,982,872 | 139,179,724 | 138,982,872 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Cleaning Appliances | $ | 449,319 | $ | 503,388 | $ | 1,277,986 | $ | 1,351,576 | |||||||||||||||
Cooking and Beverage Appliances | 339,328 | 260,438 | 939,060 | 696,568 | |||||||||||||||||||
Food Preparation Appliances | 211,461 | 161,256 | 472,685 | 427,422 | |||||||||||||||||||
Other | 70,509 | 21,815 | 186,480 | 59,154 | |||||||||||||||||||
Total net sales | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 |
SHARKNINJA, INC. | |||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
(in thousands) | |||||||||||
(unaudited) | |||||||||||
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | 117,754 | $ | 185,715 | |||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||||||
Depreciation and amortization | 77,394 | 61,560 | |||||||||
Share-based compensation | 24,502 | 5,415 | |||||||||
Provision for credit losses | 2,266 | 1,149 | |||||||||
Non-cash lease expense | 9,688 | 12,318 | |||||||||
Amortization of debt discount | 694 | 700 | |||||||||
Loss on extinguishment of debt | 968 | — | |||||||||
Deferred income taxes, net | 3,905 | (13,620) | |||||||||
Loss from equity method investment | — | 361 | |||||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | (192,209) | 137,191 | |||||||||
Inventories | (258,982) | (86,068) | |||||||||
Prepaid expenses and other assets | 65,508 | (104,114) | |||||||||
Accounts payable | 343,603 | (93,877) | |||||||||
Tax payable | 883 | 18,308 | |||||||||
Operating lease liabilities | (9,280) | (11,603) | |||||||||
Accrued expenses and other liabilities | (90,914) | (74,006) | |||||||||
Net cash provided by operating activities | 95,780 | 39,429 | |||||||||
Cash flows from investing activities: | |||||||||||
Purchase of property and equipment | (70,501) | (52,872) | |||||||||
Purchase of intangible asset | (6,905) | (4,919) | |||||||||
Capitalized internal-use software development | (683) | (4,986) | |||||||||
Cash receipts on beneficial interest in sold receivables | 16,777 | — | |||||||||
Investment in equity method investment | — | (361) | |||||||||
Other investing activities, net | (3,051) | (300) | |||||||||
Net cash used in investing activities | (64,363) | (63,438) | |||||||||
SHARKNINJA, INC. | |||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
(continued) | |||||||||||
(in thousands) | |||||||||||
(unaudited) | |||||||||||
Nine Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from issuance of debt, net of issuance cost | 800,915 | 259,895 | |||||||||
Repayment of debt | (437,500) | (155,000) | |||||||||
Intercompany note to Former Parent | — | (49,286) | |||||||||
Distribution paid to Former Parent | (435,292) | (45,438) | |||||||||
Recharge from Former Parent for share-based compensation | (3,165) | (15,300) | |||||||||
Net cash used in financing activities | (75,042) | (5,129) | |||||||||
Effect of exchange rates changes on cash | (4,768) | (11,782) | |||||||||
Net decrease in cash, cash equivalents, and restricted cash | (48,393) | (40,920) | |||||||||
Cash, cash equivalents, and restricted cash at beginning of period | 218,770 | 240,597 | |||||||||
Cash, cash equivalents, and restricted cash at end of period | $ | 170,377 | $ | 199,677 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net sales | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 | |||||||||||||||
Divested subsidiary net sales adjustment (1) | (13,196) | (24,003) | (77,544) | (65,873) | |||||||||||||||||||
Adjusted Net Sales(2) | $ | 1,057,421 | $ | 922,894 | $ | 2,798,667 | $ | 2,468,847 |
Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | ||||||||||||||||||||||||||||||||||
($ in thousands, except %) | Net sales | Divested subsidiary adjustment | Adjusted Net Sales | Net sales | Divested subsidiary adjustment | Adjusted Net Sales | |||||||||||||||||||||||||||||
Cleaning appliances | $ | 449,319 | $ | (6,838) | $ | 442,481 | $ | 503,388 | $ | (17,285) | $ | 486,103 | |||||||||||||||||||||||
Cooking appliances | 339,328 | (1,190) | 338,138 | 260,438 | (2,259) | 258,179 | |||||||||||||||||||||||||||||
Food Preparation Appliances | 211,461 | (2,133) | 209,328 | 161,256 | (4,459) | 156,797 | |||||||||||||||||||||||||||||
Other | 70,509 | (3,035) | 67,474 | 21,815 | — | 21,815 | |||||||||||||||||||||||||||||
Total net sales | $ | 1,070,617 | $ | (13,196) | $ | 1,057,421 | $ | 946,897 | $ | (24,003) | $ | 922,894 |
Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||||||||||||||||
($ in thousands, except %) | Net sales | Divested subsidiary adjustment | Adjusted Net Sales | Net sales | Divested subsidiary adjustment | Adjusted Net Sales | |||||||||||||||||||||||||||||
Cleaning appliances | $ | 1,277,986 | $ | (49,392) | $ | 1,228,594 | $ | 1,351,576 | $ | (50,303) | $ | 1,301,273 | |||||||||||||||||||||||
Cooking appliances | 939,060 | (6,161) | 932,899 | 696,568 | (5,895) | 690,673 | |||||||||||||||||||||||||||||
Food Preparation Appliances | 472,685 | (8,289) | 464,396 | 427,422 | (9,675) | 417,747 | |||||||||||||||||||||||||||||
Other | 186,480 | (13,702) | 172,778 | 59,154 | — | 59,154 | |||||||||||||||||||||||||||||
Total net sales | $ | 2,876,211 | $ | (77,544) | $ | 2,798,667 | $ | 2,534,720 | $ | (65,873) | $ | 2,468,847 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net sales | $ | 1,070,617 | $ | 946,897 | $ | 2,876,211 | $ | 2,534,720 | |||||||||||||||
Cost of sales | (583,124) | (603,413) | (1,591,254) | (1,547,843) | |||||||||||||||||||
Gross profit | 487,493 | 343,484 | 1,284,957 | 986,877 | |||||||||||||||||||
Gross margin % | 45.5% | 36.3% | 44.7% | 38.9% | |||||||||||||||||||
Divested subsidiary net sales adjustment (1) | (13,196) | (24,003) | (77,544) | (65,873) | |||||||||||||||||||
Divested subsidiary cost of sales adjustment(2) | 7,628 | 15,387 | 45,116 | 41,323 | |||||||||||||||||||
Product Procurement Adjustment(3) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Adjusted Gross Profit | $ | 505,499 | $ | 353,209 | $ | 1,305,898 | $ | 1,013,558 | |||||||||||||||
Adjusted Net Sales | $ | 1,057,421 | $ | 922,894 | $ | 2,798,667 | $ | 2,468,847 | |||||||||||||||
Adjusted Gross Margin | 47.8% | 38.3% | 46.7% | 41.1% |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Operating income | $ | 94,548 | $ | 109,080 | $ | 272,810 | $ | 267,568 | |||||||||||||||
Share-based compensation(1) | 21,337 | 969 | 24,502 | 5,415 | |||||||||||||||||||
Litigation costs(2) | 3,965 | 19 | 4,600 | 4,024 | |||||||||||||||||||
Amortization of acquired intangible assets(3) | 4,897 | 4,897 | 14,690 | 14,691 | |||||||||||||||||||
Separation and distribution related costs(4) | 41,455 | 275 | 76,549 | 275 | |||||||||||||||||||
Product Procurement Adjustment(5) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Divested subsidiary operating income adjustment(6) | 287 | (1,668) | (8,456) | (4,811) | |||||||||||||||||||
Adjusted Operating Income | $ | 190,063 | $ | 131,913 | $ | 438,064 | $ | 338,393 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except share and per share amounts) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Share-based compensation(1) | 21,337 | 969 | 24,502 | 5,415 | |||||||||||||||||||
Litigation costs(2) | 3,965 | 19 | 4,600 | 4,024 | |||||||||||||||||||
Foreign currency losses (gains), net(3) | 3,862 | (839) | 43,479 | 11,783 | |||||||||||||||||||
Amortization of acquired intangible assets(4) | 4,897 | 4,897 | 14,690 | 14,691 | |||||||||||||||||||
Separation and distribution related costs(5) | 41,455 | 275 | 76,549 | 275 | |||||||||||||||||||
Product Procurement Adjustment(6) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Tax impact of adjusting items(7) | (4,704) | (5,206) | (30,686) | (19,232) | |||||||||||||||||||
Tax withholding adjustment (8) | 19,474 | — | 19,474 | — | |||||||||||||||||||
Divested subsidiary net income adjustment(9) | 394 | 479 | (6,586) | 1,055 | |||||||||||||||||||
Adjusted Net Income | $ | 132,976 | $ | 99,244 | $ | 317,145 | $ | 254,957 | |||||||||||||||
Net income per share, diluted | $ | 0.13 | $ | 0.58 | $ | 0.85 | $ | 1.34 | |||||||||||||||
Adjusted Net Income Per Share | $ | 0.95 | $ | 0.71 | $ | 2.28 | $ | 1.83 | |||||||||||||||
Diluted weighted-average number of shares used in computing net income per share and Adjusted Net Income Per Share(9) | 139,430,805 | 138,982,872 | 139,179,724 | 138,982,872 | |||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
($ in thousands, except %) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net income | $ | 18,722 | $ | 80,309 | $ | 117,754 | $ | 185,715 | |||||||||||||||
Interest expense, net | 13,003 | 8,479 | 28,523 | 18,561 | |||||||||||||||||||
Provision for income taxes | 56,958 | 22,325 | 85,218 | 54,451 | |||||||||||||||||||
Depreciation and amortization | 25,602 | 21,395 | 77,394 | 61,560 | |||||||||||||||||||
EBITDA | 114,285 | 132,508 | 308,889 | 320,287 | |||||||||||||||||||
Share-based compensation(1) | 21,337 | 969 | 24,502 | 5,415 | |||||||||||||||||||
Litigation costs(2) | 3,965 | 19 | 4,600 | 4,024 | |||||||||||||||||||
Foreign currency losses (gains), net(3) | 3,862 | (839) | 43,479 | 11,783 | |||||||||||||||||||
Separation and distribution related costs(4) | 41,455 | 275 | 76,549 | 275 | |||||||||||||||||||
Product Procurement Adjustment(5) | 23,574 | 18,341 | 53,369 | 51,231 | |||||||||||||||||||
Divested subsidiary Adjusted EBITDA adjustment(6) | 264 | (459) | (11,020) | (1,800) | |||||||||||||||||||
Adjusted EBITDA | $ | 208,742 | $ | 150,814 | $ | 500,368 | $ | 391,215 | |||||||||||||||
Adjusted Net Sales | $ | 1,057,421 | $ | 922,894 | $ | 2,798,667 | $ | 2,468,847 | |||||||||||||||
Adjusted EBITDA Margin | 19.7% | 16.3% | 17.9% | 15.8% |