8-K

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

February 3, 2021

Date of Report (Date of earliest event reported)

EMCORE CORPORATION

Exact Name of Registrant as Specified in its Charter

New Jersey	001-36632	22-2746503
State of Incorporation	Commission File Number	IRS Employer Identification Number

2015 W. Chestnut Street, Alhambra, California, 91803

Address of principal executive offices, including zip code

(626) 293-3400

Registrant’s telephone number, including area code

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:

☐ 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(s)	Name of Each Exchange on Which Registered
Common stock, no par value	EMKR	The Nasdaq Stock Market LLC (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 (§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. ◻

Item 2.02          Results of Operations and Financial Condition.

On February 3, 2021, EMCORE Corporation (the “Registrant”) issued a press release disclosing its financial results for its first fiscal quarter ended December 31, 2020. A copy of this press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (“Current Report”).

The information in this Current Report, including Exhibit 99.1 hereto, shall not be incorporated by reference into any filing of the Registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934 (the “Exchange Act”), whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference in such filing. Furthermore, the information in this Current Report, including Exhibit 99.1 hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise be subject to the liabilities of that section.

Item 9.01          Financial Statements and Exhibits.

(d) Exhibits

Exhibit
Number	Exhibit Description
99.1	Press Release, dated February 3, 2021, issued by EMCORE Corporation.
104	Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)

SIGNATURE

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.

	EMCORE CORPORATION
	By:	/s/ Tom Minichiello
	Name:	Tom Minichiello
Dated:    February 3, 2021	Title:	Chief Financial Officer

EX-99.1

Exhibit 99.1

EMCORE Reports Fiscal 2021 First Quarter Results

ALHAMBRA, CA, February 3, 2021 – EMCORE Corporation (Nasdaq: EMKR), a leading provider of advanced mixed-signal products that serve the aerospace & defense and broadband communications markets, today announced results for the fiscal 2021 first quarter ended December 31, 2020 (1Q21). Management will host a conference call to discuss financial and business results tomorrow, Thursday, February 4, 2021, at 8:00 AM Eastern Time.

Consolidated revenue for 1Q21 was $33.4 million, comprised of $13.6 million from the Aerospace & Defense segment and $19.8 million from the Broadband segment. Net income on a GAAP and non-GAAP basis was $2.6 million and $3.4 million, respectively, in 1Q21 compared with a net income on a GAAP and non-GAAP basis of $0.7 million and $2.9 million, respectively, in 4Q20. Adjusted EBITDA was positive $4.4 million in 1Q21.

“The EMCORE team executed well in 1Q21 combining revenue and gross margin consistency with lower operating expenses to drive strong sequential-quarter earnings growth,” said Jeff Rittichier, Chief Executive Officer of EMCORE. “We continued to overcome COVID-19 related challenges in our supply chain and operations, and made good progress on product qualification and new programs capture despite the COVID headwinds. We remain excited and confident about the growth prospects across our Aerospace & Defense product portfolio. On the Broadband side, we have strong order book for our Cable TV products through the September 2021 quarter with MSOs favoring proven linear optics to provide the network bandwidth that customers need,” concluded Rittichier.

Consolidated Results

	Three Months Ended
	Dec 31, 2020	Sep 30, 2020	+ increase /
	1Q21	4Q20	- decrease
Revenue	$33.4M	$33.5M	-$0.1M
Gross Margin	38%	37%	+1%
Operating Expenses	$10.1M	$11.9M	-$1.8M
Operating Margin	8%	2%	+6%
Net Income	$2.6M	$0.7M	+$1.9M
Earnings Per Share Basic	$0.09	$0.02	+$0.07
Earnings Per Share Diluted	$0.08	$0.02	+$0.06
Non-GAAP Gross Margin (1)	38%	38%	-
Non-GAAP Operating Expenses (1)	$9.3M	$9.7M	-0.4M
Non-GAAP Operating Margin (1)	10%	9%	+1%
Non-GAAP Net Income (1)	$3.4M	$2.9M	+$0.5M
Non-GAAP Earnings Per Share Basic (1)	$0.12	$0.10	+$0.02
Non-GAAP Earnings Per Share Diluted (1)	$0.11	$0.10	+$0.01
Adjusted EBITDA	$4.4M	$4.0M	+$0.4M
Ending Cash and Cash Equivalents	$31.2M	$30.5M	+$0.7M
Loan Payable	$6.5M	$6.5M	-
(1) Please refer to the schedules at the end of this press release for complete GAAP to non-GAAP reconciliations and other information related to non-GAAP financial measures.

Aerospace and Defense (A&D) Segment

A&D’s sequential-quarter revenue decrease was primarily due to lower sales of Navigation products. A&D’s gross margin decreased slightly, primarily due to the lower revenue.

	Three Months Ended
	Dec 31, 2020	Sep 30, 2020	+ increase /
	1Q21	4Q20	- decrease
A&D Segment Revenue	$13.6M	$14.5M	-$0.9M
A&D Segment Gross Margin	30%	31%	-1%
A&D Segment R&D Expense (2)	$3.7M	$5.6M	-$1.9M
A&D Segment Profit	$0.4M	-$1.1M	+$1.5M
Non-GAAP A&D Segment Gross Margin (1)	31%	32%	-1%
Non-GAAP A&D Segment R&D Expense (1)	$3.6M	$4.0M	-$0.4M
Non-GAAP A&D Segment Profit	$0.6M	$0.6M	-
(1) Please refer to the schedules at the end of this press release for complete GAAP to non-GAAP reconciliations and other information related to non-GAAP financial measures.
(2) Individual components may not sum to the total of reported consolidated amounts due to rounding.

Broadband Segment

Broadband’s sequential-quarter revenue increase was primarily driven by higher sales of Cable TV optical transmitters and components. Broadband’s gross margin increased slightly, primarily driven by the higher revenue.

	Three Months Ended
	Dec 31, 2020	Sep 30, 2020	+ increase /
	1Q21	4Q20	- decrease
Broadband Segment Revenue	$19.8M	$19.0M	+$0.8M
Broadband Segment Gross Margin	43%	42%	+1%
Broadband Segment R&D Expense (2)	$0.6M	$0.7M	-$0.1M
Broadband Segment Profit	$7.9M	$7.3M	+$0.6M
Non-GAAP Broadband Segment Gross Margin (1)	43%	42%	+1%
Non-GAAP Broadband Segment R&D Expense (1)	$0.5M	$0.6M	-$0.1M
Non-GAAP Broadband Segment Profit	$8.0M	$7.4M	+$0.6M
(1) Please refer to the schedules at the end of this press. release for complete GAAP to non-GAAP reconciliations and other information related to non-GAAP financial measures.
(2) Individual components may not sum to the total of reported consolidated amounts due to rounding.

Business Outlook

The Company expects revenue for the fiscal second quarter ending March 31, 2021 to be in the range of $34 million to $36 million.

Conference Call

The Company will discuss its financial results on February 4, 2021 at 8:00 a.m. ET (5:00 a.m. PT). The call will be available, live, to interested parties by dialing 866-248-8441. For international callers, please dial +1 323-289-6576. The conference passcode number is 8047032. The call will be webcast live via the Company's website at http://www.emcore.com. A webcast will be available for replay beginning Thursday, February 4, 2021 following the conclusion of the call.

About EMCORE

EMCORE Corporation is a leading provider of advanced mixed-signal products that serve the aerospace & defense and broadband communications markets. Our best-in-class components and systems support a broad array of applications including navigation and inertial sensing, defense optoelectronics, broadband transport, 5G wireless infrastructure, optical sensing, and cloud data centers. We leverage industry-leading Quartz MEMS, Lithium Niobate and Indium Phosphide chip-level technology to deliver state-of-the-art component and system-level products across our end-market applications. EMCORE has vertically-integrated manufacturing capability at its wafer fabrication facility in Alhambra, CA, and Quartz MEMS manufacturing facility in Concord, CA. Our manufacturing facilities maintain ISO 9001 quality management certification, and we are AS9100 aerospace quality certified at our facility in Concord. For further information about EMCORE, please visit http://www.emcore.com.

Use of Non-GAAP Financial Measures

The Company conforms to U.S. Generally Accepted Accounting Principles (“GAAP”) in the preparation of its financial statements. We disclose supplemental non-GAAP earnings measures for gross profit margin, operating expenses, operating profit margin, net income, and earnings per share, as well as adjusted EBITDA.

Management believes these supplemental non-GAAP measures reflect the Company’s core ongoing operating performance and facilitates comparisons across reporting periods. The Company uses these measures when evaluating its financial results and for planning and forecasting of future periods. We believe that these supplemental non-GAAP measures are also useful to investors in assessing our operating performance. While we believe in the usefulness of these supplemental non-GAAP measures, there are limitations. Our non-GAAP measures may not be reported by other companies in our industry and/or may not be directly comparable to similarly titled measures of other companies due to potential differences in calculation. We compensate for these limitations by using these non-GAAP measures as a supplement to GAAP and by providing the reconciliations to the most comparable GAAP measure.

The schedules at the end of this press release reconcile the Company’s non-GAAP measures to the most directly comparable GAAP measure. The adjustments share one or more of the following characteristics: they are unusual and the Company does not expect them to recur in the ordinary course of its business, they do not involve the expenditure of cash, they are unrelated to the ongoing operation of the business in the ordinary course, or their magnitude and timing is largely outside of the Company’s control. For all reporting periods disclosed, the Company has applied consistent rationale, method, and adjustments in reconciling non-GAAP measures to the most directly comparable GAAP measure.

Non-GAAP measures are not in accordance with or an alternative to GAAP, nor are they meant to be considered in isolation or as a substitute for comparable GAAP measures. Our disclosures of these measures should be read only in conjunction with our financial statements prepared in accordance with GAAP. Non-GAAP measures should not be viewed as a substitute for the Company’s GAAP results.

Forward-Looking Statements

The information provided herein may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (“Exchange Act”). These forward-looking statements are largely based on our current expectations and projections about future events and financial trends affecting the financial condition of our business. Such forward-looking statements include, in particular, projections about our future results, statements about our plans, strategies, business prospects, changes and trends in our business and the markets in which we operate.

These forward-looking statements may be identified by the use of terms and phrases such as “anticipates”, “believes”, “can”, “could”, “estimates”, “expects”, “forecasts”, “intends”, “may”, “plans”, “projects”, “targets”, “will”, and similar expressions or variations of these terms and similar phrases. Additionally, statements concerning future matters such as projected financial results, the development of new products, enhancements or technologies, sales levels, expense levels and other statements regarding matters that are not historical are forward-looking statements. We caution that these forward-looking statements relate to future events or our future financial performance and are subject to business, economic, and other risks and uncertainties, both known and unknown, that may cause actual results, levels of activity, performance or achievements of our business or our industry to be materially different from those expressed or implied by any forward-looking statements.

These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected, including without limitation, the following: (a) the rapidly evolving markets for the Company's products and uncertainty regarding the development of these markets; (b) the Company's historical dependence on sales to a limited number of customers and fluctuations in the mix of products and customers in any period; (c) delays and other difficulties in commercializing new products; (d) the failure of new products: (i) to perform as expected without material defects, (ii) to be manufactured at acceptable volumes, yields, and cost, (iii) to be qualified and accepted by our customers, and (iv) to successfully compete with products offered by our competitors; (e) uncertainties concerning the availability and cost of commodity materials and specialized product components that we do not make internally; (f) actions by competitors; (g) risks and uncertainties related to applicable laws and regulations, including the impact of changes to applicable tax laws and tariff regulations; (h) acquisition-related risks, including that (i) the revenues and net operating results obtained from our acquisition of the Systron Donner Inertial ("SDI") business may not meet our expectations, (ii) the costs and cash expenditures for integration of the SDI business operations may be higher than expected, (iii) there could be losses and liabilities arising from the acquisition of SDI that we will not be able to recover from any source, and (iv) we may not realize sufficient scale in our navigation systems product line from the SDI acquisition and will need to take additional steps, including making additional acquisitions, to achieve our growth objectives for this product line; (i) risks related to our ability to obtain capital; (j) risks related to the transition of certain of our manufacturing operations from our Beijing facility to a contract manufacturer’s facility; (k) the outbreak of COVID-19 and the impact on our business and operations, which is evolving and beyond our control; and (l) other risks and uncertainties discussed under Item 1A - Risk Factors in our Annual Report on Form 10-K for the fiscal year ended September 30, 2020, as updated by our subsequent periodic reports.

Forward-looking statements are based on certain assumptions and analysis made in light of our experience and perception of historical trends, current conditions and expected future developments as well as other factors that we believe are appropriate under the circumstances. While these statements represent our judgment on what the future may hold, and we believe these judgments are reasonable, these statements are not guarantees of any events or financial results. All forward-looking statements in this press release are made as of the date hereof, based on information available to us as of the date hereof, and subsequent facts or circumstances may contradict, obviate, undermine, or otherwise fail to support or substantiate such statements. We caution you not to rely on these statements without also considering the risks and uncertainties associated with these statements and our business that are addressed in our filings with the Securities and Exchange Commission (“SEC”) that are available on the SEC’s web site located at www.sec.gov, including the sections entitled “Risk Factors” in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q. Certain information included in this press release may supersede or supplement forward-looking statements in our other Exchange Act reports filed with the SEC. We do not intend to update any forward-looking statement to conform such statements to actual results or to changes in our expectations, except as required by applicable law or regulation.

EMCORE CORPORATION

Condensed Consolidated Statement of Operations

(in thousands, except for per share data)

(unaudited)

	For the three months ended
	December 31,
	2020		2019
Revenue	$	33,426	$	25,482
Cost of revenue		20,854		18,008
Gross profit		12,572		7,474
Operating expense:
Selling, general, and administrative		5,798		5,887
Research and development		4,296		4,642
Gain on sale of assets		(29)		(1,602)
Total operating expense		10,065		8,927
Operating income (loss)		2,507		(1,453)
Other income:
Interest expense, net		(49)		(15)
Foreign exchange gain		237		147
Total other income		188		132
Income (loss) before income tax expense		2,695		(1,321)
Income tax expense		(126)		(14)
Net income (loss)	$	2,569	$	(1,335)
Foreign exchange translation adjustment		(10)		(36)
Comprehensive income (loss)	$	2,559	$	(1,371)
Per share data:
Net income (loss) per basic share	$	0.09	$	(0.05)
Weighted-average number of basic shares outstanding		29,503		28,832
Net income (loss) per diluted share	$	0.08	$	(0.05)
Weighted-average number of diluted shares outstanding		30,377		28,832

EMCORE CORPORATION

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

	December 31,		September 30,
	2020		2020
ASSETS
Current assets:
Cash and cash equivalents	$	31,120	$	30,390
Restricted cash		38		148
Accounts receivable, net of credit loss of $234 and $227, respectively		27,276		25,324
Contract assets		582		1,566
Inventory		27,855		25,525
Prepaid expenses and other current assets		4,283		5,589
Assets held for sale		1,661		1,568
Total current assets		92,815		90,110
Property, plant, and equipment, net		20,558		21,052
Goodwill		69		69
ROU assets		14,262		14,566
Other intangible assets, net		193		202
Other non-current assets		229		242
Total assets	$	128,126	$	126,241
LIABILITIES and SHAREHOLDERS’ EQUITY
Current liabilities:
PPP liability - current	$	1,093	$	—
Accounts payable		17,158		16,484
Accrued expenses and other current liabilities		9,650		11,577
ROU liability - current		979		992
Total current liabilities		28,880		29,053
PPP liability - non-current		5,395		6,488
ROU liability - non-current		13,481		13,735
Asset retirement obligations		2,041		2,022
Other long-term liabilities		794		794
Total liabilities		50,591		52,092
Commitments and contingencies
Shareholders’ equity:
Common stock, no par value, 50,000 shares authorized; 36,693 shares issued and 29,783 shares outstanding as of December 31, 2020; 36,461 shares issued and 29,551 shares outstanding as of September 30, 2020		745,188		744,361
Treasury stock at cost; 6,910 shares		(47,721)		(47,721)
Accumulated other comprehensive income		908		918
Accumulated deficit		(620,840)		(623,409)
Total shareholders’ equity		77,535		74,149
Total liabilities and shareholders’ equity	$	128,126	$	126,241

EMCORE CORPORATION

Reconciliations of GAAP to Non-GAAP Financial Measures

	Three Months Ended
	Dec 31, 2020		Sep 30, 2020
	1Q21		4Q20
Gross Profit	$	12,572	$	12,463
Gross Margin		38%		37%
Adjustments:
Stock-based compensation		141		194
Asset retirement obligation (ARO) accretion		19		8
Amortization of acquired intangibles		9		9
Total adjustments		169		211
Non-GAAP Gross Profit	$	12,741	$	12,674
Non-GAAP Gross Margin		38%		38%

	Three Months Ended
	Dec 31, 2020		Sep 30, 2020
	1Q21		4Q20
Operating Expenses	$	10,065	$	11,850
Stock-based compensation		(762)		(697)
Severance and restructuring charges		(41)		(5)
CATV transition - gain on sale of asset		29		55
Litigation-related expenses		—		(1,464)
Non-GAAP Operating Expenses	$	9,291	$	9,739

	Three Months Ended
	Dec 31, 2020		Sep 30, 2020
	1Q21		4Q20
Operating Profit	$	2,507	$	613
Operating Margin		8%		2%
Adjustments:
Stock-based compensation		903		891
Asset retirement obligation (ARO) accretion		19		8
Amortization of acquired intangibles		9		9
Severance and restructuring charges		41		5
CATV transition - gain on sale of asset		(29)		(55)
Litigation-related expenses		—		1,464
Total adjustments		943		2,322
Non-GAAP Operating Profit		3,450		2,935
Non-GAAP Operating Margin		10%		9%
Depreciation		996		1,108
Adjusted EBITDA	$	4,446	$	4,043
Adjusted EBITDA %		13%		12%

	Three Months Ended
	Dec 31, 2020		Sep 30, 2020
	1Q21		4Q20
Net Income	$	2,569	$	703
Earnings Per Share Basic		0.09		0.02
Earnings Per Share Diluted		0.08		0.02
Adjustments:
Stock-based compensation		903		891
Asset retirement obligation (ARO) accretion		19		8
Amortization of acquired intangibles		9		9
Severance and restructuring charges		41		5
CATV transition - gain on sale of asset		(29)		(55)
Litigation-related expenses		—		1,464
Foreign currency gain		(237)		(227)
Income tax expense		126		87
Total adjustments		832		2,182
Non-GAAP Net Income		3,401		2,885
Non-GAAP Earnings Per Share Basic		0.12		0.10
Non-GAAP Earnings Per Share Diluted		0.11		0.10
Interest expense, net		49		50
Depreciation		996		1,108
Adjusted EBITDA	$	4,446	$	4,043
Adjusted EBITDA %		13%		12%

	Three Months Ended					Three Months Ended
	Dec 31, 2020		Sep 30, 2020			Dec 31, 2020		Sep 30, 2020
	1Q21		4Q20			1Q21		4Q20
Aerospace and Defense					Broadband
Gross Profit	$	4,100	$	4,501	Gross Profit	$	8,472	$	7,962
Gross Margin		30%		31%	Gross Margin		43%		42%
Adjustments:					Adjustments:
Stock-based compensation		91		154	Stock-based compensation		50		40
Asset retirement obligation (ARO) accretion		—		—	Asset retirement obligation (ARO) accretion		19		8
Amortization of acquired intangibles		9		9	Amortization of acquired intangibles		—		—
Total adjustments		100		163	Total adjustments		69		48
Non-GAAP Gross Profit	$	4,200	$	4,664	Non-GAAP Gross Profit	$	8,541	$	8,010
Non-GAAP Gross Margin		31%		32%	Non-GAAP Gross Margin		43%		42%
Aerospace and Defense					Broadband
R&D Expenses	$	3,686	$	5,574	R&D Expenses	$	610	$	662
Stock-based compensation		(123)		(70)	Stock-based compensation		(80)		(42)
Litigation-related expenses		—		(1,464)	Litigation-related expenses		—		—
Non-GAAP R&D Expenses	$	3,563	$	4,040	Non-GAAP R&D Expenses	$	530	$	620

Contact:

EMCORE Corporation

Tom Minichiello

(626) 293-3400

investor@emcore.com

XML

Document and Entity Information	Feb. 03, 2021
Document and Entity Information [Abstract]
Document Type	8-K
Document Period End Date	Feb. 03, 2021
Entity Registrant Name	EMCORE CORP
Entity File Number	001-36632
Entity Incorporation, State or Country Code	NJ
Entity Tax Identification Number	22-2746503
Entity Address, Address Line One	2015 W. Chestnut Street
Entity Address, City or Town	Alhambra
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91803
City Area Code	626
Local Phone Number	293-3400
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common stock, no par value
Trading Symbol	EMKR
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false
Entity Central Index Key	0000808326
Amendment Flag	false