Lantronix Inc (LTRX) SEC Filing 10-Q Quarterly report for the period ending Sunday, September 30, 2018

Lantronix Inc

CIK: 1609471 Ticker: LTRX

Exhibit 99.1




Lantronix Reports First Quarter Fiscal 2019 Net Revenue of $12.3M Representing 16% Year-over-Year Growth

--Increases Cash Position to $18.9M After Public Offering--


Irvine, CA – October 25, 2018

– Lantronix, Inc. (NASDAQ: LTRX), a global provider of secure data access and management solutions for the industrial Internet of Things (IoT) today reported results for the first quarter fiscal 2019 that ended September 30, 2018.


Financial Highlights for First Quarter of Fiscal 2019


  ·  Net revenue of $12.3 million, an increase of 16% from the first quarter of fiscal 2018
  ·  Gross profit margin of 54.9%, an improvement of more than 200 basis points from the first quarter of fiscal 2018
  ·  GAAP net loss of $83,000, or $0.00 per share, an 87% year-over-year improvement in GAAP net loss
  ·  Non-GAAP net income of $883,000, or $0.04 per share, a 189% year-over-year increase in non-GAAP net income
  ·  Increased cash position to $18.9 million as of September 30, 2018 after closing a successful public offering


Operational and Product Highlights


  ·  In July, the company’s new centralized management software for out-of-band networks, ConsoleFlow™ powered by MACH10® was recognized by CRN as one of the Top 8 Cool Products at Cisco Live
  ·  In August, the company announced that it had joined the Microsoft Azure Certified for Internet of Things (IoT) program, ensuring customers get IoT solutions up and running quickly with hardware and software that has been pre-tested and verified to work with Microsoft Azure IoT services
  ·  In August, Lantronix was added to the LD Micro Index, which tracks daily activity of representative microcap companies with market capitalizations between $50 million and $300 million
  ·  In August, Fathi Hakam joined the company as the new vice president of engineering. Mr. Hakam brings a wealth of experience from engineering leadership roles he has held in the tech industry, including delivering solutions for OEMs in the networking and wireless space
  ·  In September, the company announced an underwritten public offering of 2,500,000 shares of its common stock at a price to the public of $4.00 per share, for gross proceeds of $10 million
  ·  In September, the company reached a patent settlement with USR IoT in Europe, as part of which USR IoT agreed to cease and desist SuperPort sales
  ·  Most recently, in October, the company announced the new ConsoleFlow™ Cloud Edition, the industry’s only centralized out-of-band management software that provides VPN-free access to console managers and IT equipment








“I am very pleased with our first quarter results. On a year-over-year basis, we delivered double digit revenue growth and significantly improved our bottom line” said Jeff Benck, Lantronix CEO.  “I am excited about our successful public offering that doubled our cash position and enables us to pursue a growth strategy that could include acquisitions.”


Conference Call and Webcast


Lantronix will host an investor conference call and audio webcast today at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) to discuss its results for the first quarter fiscal 2019 ended September 30, 2018. To access the live conference call, investors should dial 1-844-802-2442 (US) or 1-412-317-5135 (international) and indicate that they are participating in the Lantronix Q1 FY 2019 call. The webcast will be available simultaneously via the investor relations section of the Company’s website at


Investors can access a replay of the conference call starting at approximately 5:00 p.m. Pacific Daylight Time today at A telephonic replay will also be available through November 25, 2018 by dialing 1-877-344-7529 (US) or 1-412-317-0088 (international) and entering passcode 10125322.


About Lantronix


Lantronix, Inc. is a global provider of secure data access and management solutions for the Internet of Things (IoT) assets. Our mission is to be the leading supplier of IoT solutions that enable companies to dramatically simplify the creation, deployment, and management of IoT projects while providing secure access to data for applications and people.


With more than two decades of experience in creating robust machine to machine (M2M) technologies, Lantronix is an innovator in enabling our customers to build new business models and realize the possibilities of the Internet of Things. Our connectivity solutions are deployed inside millions of machines serving a wide range of industries, including industrial, medical, security, transportation, retail, financial, environmental and government.


Lantronix is headquartered in Irvine, California. For more information, visit


Learn more on the Lantronix blog,, featuring industry discussion and updates. To follow Lantronix on Twitter, please visit View our video library on YouTube at or connect with us on LinkedIn at


Discussion of Non-GAAP Financial Measures


Lantronix believes that the presentation of non-GAAP financial information, when presented in conjunction with the corresponding GAAP measures, provides important supplemental information to management and investors regarding financial and business trends relating to the company’s results of operations. Management uses the aforementioned non-GAAP measures to monitor and evaluate ongoing operating results and trends to gain an understanding of our comparative operating performance. The non-GAAP financial measures disclosed by the company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations of the non-GAAP financial measures to the financial measures calculated in accordance with GAAP should be carefully evaluated. The non-GAAP financial measures used by the company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The company has provided reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures.







Non-GAAP net income (loss) consists of net income (loss) excluding (i) share-based compensation and the employer portion of withholding taxes on stock grants, (ii) depreciation and amortization, (iii) interest income (expense), (iv) other income (expense), (v) income tax provision (benefit), and (vi) severance and restructuring charges.


Non-GAAP net income (loss) per share is calculated by dividing non-GAAP net income (loss) by non-GAAP weighted-average shares outstanding (diluted). For purposes of calculating non-GAAP net income (loss) per share, the calculation of GAAP weighted-average shares outstanding (diluted) is adjusted to exclude share-based compensation, which for GAAP purposes is treated as proceeds assumed to be used to repurchase shares under the GAAP treasury stock method.


Forward-Looking Statements


This news release contains forward-looking statements, including statements concerning our sales expansion efforts, our product development efforts, and our projected operating and financial performance. These forward-looking statements are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. We have based our forward-looking statements on our current expectations and projections about trends affecting our business and industry and other future events. Although we do not make forward-looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. Forward-looking statements are subject to substantial risks and uncertainties that could cause our results or experiences, or future business, financial condition, results of operations or performance, to differ materially from our historical results or those expressed or implied in any forward-looking statement contained in this news release. Some of the risks and uncertainties that may cause actual results to differ from those expressed or implied in the forward-looking statements are described in “Risk Factors” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission, or SEC, as well as in our other filings with the SEC. In addition, actual results may differ as a result of additional risks and uncertainties of which we are currently unaware or which we do not currently view as material to our business. For these reasons, investors are cautioned not to place undue reliance on any forward-looking statements. The forward-looking statements we make speak only as of the date on which they are made. We expressly disclaim any intent or obligation to update any forward-looking statements after the date hereof to conform such statements to actual results or to changes in our opinions or expectations, except as required by applicable law or the rules of the NASDAQ Stock Market, LLC. If we do update or correct any forward-looking statements, investors should not conclude that we will make additional updates or corrections.


Lantronix Investor Relations Contact:

Shahram Mehraban

VP, Marketing


# # #


© 2018 Lantronix, Inc. All rights reserved. Lantronix, MACH10 and XPort are registered trademarks, and ConsoleFlow is a trademark, of Lantronix, Inc.







(In thousands)



   September 30,   June 30, 
   2018   2018 
Current assets:          
Cash and cash equivalents  $18,925   $9,568 
Accounts receivable, net   5,917    4,244 
Inventories, net   8,032    8,439 
Contract manufacturers' receivable   554    649 
Prepaid expenses and other current assets   794    370 
Total current assets   34,222    23,270 
Property and equipment, net   1,031    1,036 
Goodwill   9,488    9,488 
Other assets   57    61 
Total assets  $44,798   $33,855 
Liabilities and stockholders' equity          
Current liabilities:          
Accounts payable  $3,986   $3,942 
Accrued payroll and related expenses   1,972    2,808 
Warranty reserve   92    99 
Other current liabilities   3,765    2,877 
Total current liabilities   9,815    9,726 
Other non-current liabilities   283    316 
Total liabilities   10,098    10,042 
Commitments and contingencies          
Stockholders' equity:          
Common stock   2    2 
Additional paid-in capital   223,383    212,995 
Accumulated deficit   (189,056)   (189,555)
Accumulated other comprehensive income   371    371 
Total stockholders' equity   34,700    23,813 
Total liabilities and stockholders' equity  $44,798   $33,855 










(In thousands, except per share data)



   Three Months Ended 
   September 30,   June 30,   September 30, 
   2018   2018   2017 
Net revenue  $12,279   $12,037   $10,606 
Cost of revenue   5,538    5,161    5,012 
Gross profit   6,741    6,876    5,594 
Operating expenses:               
Selling, general and administrative   4,472    4,099    3,986 
Research and development   2,298    2,006    2,221 
Total operating expenses   6,770    6,105    6,207 
Income (loss) from operations   (29)   771    (613)
Interest expense, net   (4)   (4)   (4)
Other income (expense), net   (10)   (9)   1 
Income (loss) before income taxes   (43)   758    (616)
Provision for income taxes   40    6    25 
Net income (loss)  $(83)  $752   $(641)
Net income (loss) per share -basic  $(0.00)  $0.04   $(0.04)
Net income (loss) per share - diluted  $(0.00)  $0.04   $(0.04)
Weighted-average common shares - basic   19,323    18,536    17,867 
Weighted-average common shares - diluted   19,323    19,738    17,867 









(In thousands, except per share data)



   Three Months Ended 
   September 30,   June 30,   September 30, 
   2018   2018   2017 
GAAP net income (loss)  $(83)  $752   $(641)
Non-GAAP adjustments:               
Cost of revenue:               
Share-based compensation   17    13    13 
Depreciation and amortization   48    49    62 
Total adjustments to cost of revenue   65    62    75 
Selling, general and administrative:               
Share-based compensation   400    236    212 
Employer portion of withholding taxes on stock grants   6    4    2 
Depreciation and amortization   46    46    45 
Total adjustments to selling, general and administrative   452    286    259 
Research and development:               
Share-based compensation   61    43    47 
Employer portion of withholding taxes on stock grants           1 
Depreciation and amortization   11    11    10 
Total adjustments to research and development   72    54    58 
Severance and related charges   323        527 
Total non-GAAP adjustments to operating expenses   847    340    844 
Interest expense, net   4    4    4 
Other expense (income), net   10    9    (1)
Provision for income taxes   40    6    25 
Total non-GAAP adjustments   966    421    947 
Non-GAAP net income  $883   $1,173   $306 
Non-GAAP net income per share - diluted  $0.04   $0.06   $0.02 
Denominator for GAAP net income (loss) per share - diluted   19,323    19,738    17,867 
Non-GAAP adjustment   2,472    454    1,536 
Denominator for non-GAAP net income per share - diluted   21,795    20,192    19,403 
GAAP operating expenses  $6,770   $6,105   $6,207 
Non-GAAP adjustments to operating expenses   (847)   (340)   (844)
Non-GAAP operating expenses  $5,923   $5,765   $5,363 










(In thousands)



   Three Months Ended 
   September 30,
   June 30,
   September 30,
IoT  $8,967   $9,088   $8,458 
IT Management   3,101    2,694    1,789 
Other   211    255    359 
   $12,279   $12,037   $10,606 


   Three Months Ended 
   September 30,
   June 30,
   September 30,
Americas  $6,914   $7,109   $5,697 
EMEA   3,520    3,222    3,164 
Asia Pacific Japan   1,845    1,706    1,745 
   $12,279   $12,037   $10,606 









The following information was filed by Lantronix Inc (LTRX) on Thursday, October 25, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Lantronix Inc's 10-Q Quarterly Report:

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Document And Entity Information
Unaudited Condensed Consolidated Balance Sheets
Unaudited Condensed Consolidated Statements Of Cash Flows
Unaudited Condensed Consolidated Statements Of Operations
1. Summary Of Significant Accounting Policies
1. Summary Of Significant Accounting Policies (Policies)
2. Revenue Recognition
2. Revenue Recognition (Details - Asc 606 Changes To Bs)
2. Revenue Recognition (Details - Asc 606 Changes To Is)
2. Revenue Recognition (Details - Deferred Revenue)
2. Revenue Recognition (Details - Revenue By Geographic Region)
2. Revenue Recognition (Details - Revenue By Product)
2. Revenue Recognition (Tables)
3. Supplemental Financial Information
3. Supplemental Financial Information (Details - Equivalents)
3. Supplemental Financial Information (Details - Inventories)
3. Supplemental Financial Information (Details - Net Loss Per Share)
3. Supplemental Financial Information (Details - Other Liabilities)
3. Supplemental Financial Information (Details Narrative)
3. Supplemental Financial Information (Details- Severance And Related Charges)
3. Supplemental Financial Information (Details- Supplemental Cash Flow Info)
3. Supplemental Financial Information (Tables)
4. Warranty Reserve
4. Warranty Reserve (Details - Warranty Reserve)
4. Warranty Reserve (Tables)
5. Bank Line Of Credit
5. Bank Line Of Credit And Debt (Details Narrative)
6. Stockholders Equity (Details - Espp Activity)
6. Stockholders Equity (Details - Option Activity)
6. Stockholders Equity (Details - Rsu Activity)
6. Stockholders Equity (Details - Share Based Compensation)
6. Stockholders Equity (Details - Unrecognized Expense)
6. Stockholders Equity (Details Narrative)
6. Stockholders' Equity
6. Stockholders' Equity (Tables)
7. Income Taxes
7. Income Taxes (Details - Effective Tax Rate)
7. Income Taxes (Tables)
8. Commitments And Contingencies
Ticker: LTRX
CIK: 1114925
Form Type: 10-Q Quarterly Report
Accession Number: 0001683168-18-003159
Submitted to the SEC: Fri Oct 26 2018 12:44:05 PM EST
Accepted by the SEC: Fri Oct 26 2018
Period: Sunday, September 30, 2018
Industry: Computer Communications Equipment

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