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Bsquare Reports Second Quarter 2018 Financial Results

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Bsquare Reports Second Quarter 2018 Financial Results

Q2 Revenue $19.2 million; Q2 EPS $(0.29); Board of Directors appoints Rob Peters and establishes a Strategic Review Committee

PR Newswire

BELLEVUE, Wash., Aug. 13, 2018 /PRNewswire/ -- Bsquare Corporation (NASDAQ:BSQR) (the "Company") today announced financial results for the second quarter of 2018. Bsquare also announced the appointment of Rob Peters, a principal of Palogic Value Management, L.P., one of the Company's largest shareholders, to the Company's board of directors in place of Bob DeSantis, who has resigned as a director due to increased demands on his time from his current position. The Company further announced the establishment of a board-level Strategic Review Committee to be chaired by Ryan Vardeman, who joined the Company's board of directors in June of this year.

"During the second quarter we pursued a set of initiatives intended to put our DataV Industrial Internet of Things ("IIoT") business on a sounder footing," stated Acting CEO Kevin Walsh. "In the quarter we added $1.4 million in new DataV bookings from existing customers, which includes the production deployment SaaS agreement with a Fortune 100 customer announced in May. Nevertheless, results from our DataV business fell short of expectations. Initiatives we have undertaken included a narrowing of product focus; increasing our go-to-market alignment with Amazon Web Services ("AWS"); and reducing our annualized operating expense levels by approximately $6.0 million in order to improve our overall financial position. We believe that these and other changes, including strong receivables collections, will result in a significant reduction in our cash burn; we expect that second half 2018 net cash usage will be in the range of $1.0 million to $2.0 million."

Mr. Walsh continued, "Our third-party software business, largely comprised of Microsoft embedded and IoT software, performed above expectations, resulting in overall revenue above the top end of our second quarter guidance range. We continue to strive to manage this business efficiently while targeting new areas for growth."

Second Quarter 2018 Financial Highlights

  • Revenue for the quarter was $19.2 million, up 1.9% compared to the second quarter of 2017 and down 7.1% compared to the first quarter of 2018.
  • Net loss for the quarter was $3.7 million, or $0.29 per diluted share, compared to net loss of $2.6 million, or $0.20 per diluted share, in the second quarter of 2017 and net loss of $2.4 million, or $0.19 per diluted share, in the first quarter of 2018.
  • Adjusted EBITDAS (1) was negative $3.6 million, down $1.5 million from the second quarter of 2017 and down $1.6 million from the first quarter of 2018.
  • Cash, cash equivalents and short-term investments at June 30, 2018 totaled $17.9 million, a decrease of approximately $9.4 million from June 30, 2017 and $3.6 million from March 31, 2018.

Details as follows (unaudited, in thousands except percentages and per share amounts):


Three Months Ended



June 30, 2018



June 30, 2017



Q2-Q2 Change (2)



March 31, 2018



Q2-Q1 Change (2)


Revenue:




















Third-party software

$

16,992



$

15,505



$

1,487



$

16,064



$

928


Proprietary software


281




481




(200)




1,795




(1,514)


Professional engineering service


1,930




2,862




(932)




2,819




(889)


Total revenue


19,203




18,848




355




20,678




(1,475)


Total gross profit

$

3,261



$

3,873



$

(612)



$

5,200



$

(1,939)


Gross margins:




















Third-party software


14.8

%



15.5

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