Qualstar Corp (QBAK) SEC Filing 8-K Material Event for the period ending Tuesday, August 13, 2019

Qualstar Corp

CIK: 758938 Ticker: QBAK

Exhibit 99.1



Qualstar Reports Fiscal 2019 Second Quarter Results


Camarillo, CA, August 13, 2019Qualstar Corporation (NASDAQ: QBAK), a leading manufacturer of data storage solutions and high-efficiency power supplies, today announced its financial results for the three and six months ended June 30, 2019.


(All amounts are in thousands, except per share data):


Results for the Three Months Ended June 30, 2019 vs. 2018


Net revenue increased 6.4% to $3,439 from $3,231


Total operating expenses decreased 12.2% to $832 from $948


Net loss of $11 or $0.01 per basic and diluted share vs. net income of $474 or $0.23 per basic and diluted share


Results for the Six Months Ended June 30, 2019 vs. 2018


Net revenue increased 2.1% to $6,295 from $6,166


Total operating expenses decreased 9.5% to $1,616 from $1,786


Net income of $130 compared to $1,064, for the prior year period, a decrease of 87.8%, or $0.07 per basic and diluted share vs. $0.52 per basic and $0.51 per diluted share


Cash provided by operations of $158 vs. $820


Highlights for the Three and Six Months Ended June 30, 2019


Strong balance sheet and no debt


Cash, restricted cash and cash equivalents decreased by 8.3% to $4,476 from $4,881 as of December 31, 2018


Revenue growth in the data storage products segment has increased for the three months ended June 30, 2019 from the same period last year by 69% to $1,129 from $668 and for the six months ended June 30, 2019 by 61.5% to $1,912 from $1,184 for the same period last year


Gross profit decreased for the three months ended June 30, 2019 from the same period last year by 43.4% to $805 from $1,422 and for the six months ended June 30, 2019 by 39.5% to $1,725 from $2,850 for the same period last year, with the decrease being primarily attributable to a one-time charge for the write-down of raw materials inventory purchased from a discontinued power supply contract manufacturer and a reduction of gross margin in the current phase of our Optical Drive Assembly (“ODA”) product development with Sony.


Under the Stock Repurchase Program, during the three and six months ended June 30, 2019 a total of 33,972 and 92,706 shares were repurchased, repectively, and as of August 9, 2019 a total of 126,366 shares have been repurchased since the program began. The program expires December 5, 2019.


“We are pleased with our growth in the data storage business; unfortunately, we are experiencing several headwinds in our power supply segment, including China tariffs, and increased competition,” said Steven N. Bronson, CEO, and President of Qualstar.“ Mr. Bronson also stated, “we are actively taking steps to address the challenges in the power supply business, including product expansion, and pursuing new strategic partnerships.”



About Qualstar Corporation


Qualstar, founded in 1984, is a diversified electronics manufacturer specializing in data storage and power supplies. Qualstar is a leading provider of high efficiency and high-density power supplies marketed under the N2Power™ brand, and of data storage systems marketed under the Qualstar™ brand. Our N2Power power supply products provide compact and efficient power conversion for a wide variety of industries and applications including, but not limited to, telecom, networking, broadcast, industrial, lighting, gaming and test equipment. Our Qualstar data storage products are used to provide highly scalable and reliable solutions to store and retrieve very large quantities of electronic data. Qualstar’s products are known throughout the world for high quality and Simply Reliable™ designs that provide years of trouble-free service. More information is available at or or by phone at 805-583-7744.





Cautionary Statement Concerning Forward-Looking Statements


Statements used in this press release that relate to future plans, events, financial results, prospects or performance are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements. These forward-looking statements are based upon the current expectations and beliefs of Qualstar's management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Notwithstanding changes that may occur with respect to matters relating to any forward looking statements, Qualstar does not expect to, and disclaims any obligation to, publicly update any forward-looking statements whether as a result of new information, future events or otherwise. Qualstar, however, reserves the right to update such statements or any portion thereof at any time for any reason. In particular, the following factors, among others, could cause actual or future results to differ materially from those suggested by the forward-looking statements: Qualstar’s ability to successfully execute on its strategic plan and meet its long-term financial goals; Qualstar’s ability to successfully implement and recognize cost savings; Qualstar’s ability to develop and commercialize new products; industry and customer adoption and acceptance of Qualstar’s new products; Qualstar’s ability to increase sales of its products; the rescheduling or cancellation of customer orders; unexpected shortages of critical components; unexpected product design or quality problems; adverse changes in market demand for Qualstar’s products; increased competition and pricing pressure on Qualstar’s products; and the risks related to actions of activist shareholders, including the amount of related costs.


For further information on these and other cautionary statements, please refer to the risk factors discussed in Qualstar’s filings with the U.S. Securities and Exchange Commission including, but not limited to, Qualstar’s Annual Report on Form 10-K for the period ending December 31, 2018, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of such Form 10-K, and any subsequently filed reports. All of Qualstar’s filings are available without charge through the SEC’s website ( or from Qualstar’s website (


Contact Information:

Steven N. Bronson

Chief Executive Officer

Qualstar Corporation




-Financial Tables to Follow-








  (In thousands, except per share data)




Three Months Ended

June 30,


Six Months Ended

June 30,










Net revenues

  $ 3,439     $ 3,231     $ 6,295     $ 6,166  

Cost of goods sold

    2,634       1,809       4,570       3,316  

Gross profit

    805       1,422       1,725       2,850  

Operating expenses:



    228       128       351       249  

Sales and marketing

    306       354       614       649  

General and administrative

    298       466       651       888  

Total operating expenses

    832       948       1,616       1,786  

Income (loss) from operations



    474       109       1,064  

Other income

    16       -       21       -  

Income (loss) before income taxes



    474       130       1,064  

Provision for income taxes

    -       -       -       -  

Net income (loss)

  $ (11


  $ 474     $ 130     $ 1,064  

Earnings per share:



  $ (0.01


  $ 0.23     $ 0.07     $ 0.52  


  $ (0.01


  $ 0.23     $ 0.07     $ 0.51  

Shares used in per share calculation:



    1,952       2,048       1,972       2,048  


    1,952       2,094       1,972       2,098  







(In thousands, except share amounts)



June 30,



December 31,







Current assets:


Cash and cash equivalents

  $ 4,376     $ 4,781  

Restricted cash

    100       100  

Accounts receivables, net

    2,238       1,809  

Inventories, net

    2,744       2,897  

Prepaid expenses and other current assets

    131       180  

Total current assets

    9,589       9,767  

Non-current assets:


Property and equipment, net

    106       112  


    822       -  

Other assets

    129       119  

Total non-current assets

    1,057       231  

Total assets

  $ 10,646     $ 9,998  

Liabilities and Shareholders’ Equity


Current liabilities:


Accounts payable

  $ 1,365     $ 1,023  

Accrued payroll and related liabilities

    203       185  

Deferred service revenue, short-term

    618       736  

Lease liabilities, current

    303       -  

Other accrued liabilities

    453       559  

Total current liabilities

    2,942       2,503  

Long-term liabilities:


Other long-term liabilities

    52       40  

Lease liabilities, long term

    545       -  

Deferred service revenue

    168       127  

Total long-term liabilities

    765       167  

Total liabilities

    3,707       2,670  

Shareholders’ equity:


Preferred stock, no par value; 5,000,000 shares authorized; no shares issued

    -       -  

Common stock, no par value; 50,000,000 shares authorized, shares issued and outstanding 1,937,310 at June 30, 2019 and 2,030,017 shares at December 31, 2018

    18,907       19,426  

Accumulated deficit





Total shareholders’ equity

    6,939       7,328  

Total liabilities and shareholders’ equity

  $ 10,646     $ 9,998  




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Qualstar Corp provided additional information to their SEC Filing as exhibits

Ticker: QBAK
CIK: 758938
Form Type: 8-K Corporate News
Accession Number: 0001437749-19-016875
Submitted to the SEC: Wed Aug 14 2019 7:40:12 PM EST
Accepted by the SEC: Thu Aug 15 2019
Period: Tuesday, August 13, 2019
Industry: Magnetic And Optical Recording Media
  1. Earnings Release
  2. Financial Exhibit

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