Peraso(PRSO) - 2024 Q2 - Quarterly Report

Revenue Performance - For the three months ended June 30, 2024, product revenue increased to $4.1 million, an 84$2.2 million in the same period of 2023[129] - Revenue from memory ICs for the three months ended June 30, 2024, was $3.4 million, up from$1.6 million in the same period of 2023[130] - The company expects revenues to increase in 2024 compared to 2023, driven by anticipated sales of memory IC products based on EOL purchase orders[131] - Royalty and other revenue decreased to $129,000 for the three months ended June 30, 2024, a 23$168,000 in the same period of 2023[132] Profitability - The gross profit margin for the three months ended June 30, 2024, improved to 55% compared to 25% in the same period of 2023[134] - Gross profit for the three months ended June 30, 2024, was $2,351,000, a 287$608,000 in 2023, representing 55% of total net revenue[136] - Gross profit for the six months ended June 30, 2024, was $3,657,000, a 44$2,535,000 in 2023, representing 52% of total net revenue[136] Expenses - Research and development expenses for the three months ended June 30, 2024, were $2,644,000, a 28$3,668,000 in 2023, representing 62% of total net revenue[137] - Research and development expenses for the six months ended June 30, 2024, were $5,457,000, a 28$7,555,000 in 2023, representing 77% of total net revenue[137] - Selling, general and administrative expenses for the three months ended June 30, 2024, were $2,141,000, an 8$1,977,000 in 2023, representing 51% of total net revenue[139] - Selling, general and administrative expenses for the six months ended June 30, 2024, were $4,243,000, a 1$4,219,000 in 2023, representing 60% of total net revenue[139] Losses and Financial Position - The company incurred net losses of approximately $6.5 million for the six months ended June 30, 2024, and an accumulated deficit of approximately$173 million as of the same date[124] - The company incurred net losses of approximately $6.5 million for the six months ended June 30, 2024, and$16.8 million for the year ended December 31, 2023[146] - The company expects to continue incurring operating losses and will need to secure additional capital to sustain operations beyond 2024[147] - Cash and cash equivalents as of June 30, 2024, were $1.9 million, with working capital of$1.1 million[142] - Net cash used in operating activities for the first six months of 2024 was $3.2 million, primarily due to a net loss of$6.5 million[142] Corporate Actions - The company completed a 1-for-40 reverse stock split effective January 2, 2024, to consolidate its outstanding shares[125] - The company initiated an end-of-life (EOL) for its memory IC products in May 2023, with expected final shipments by March 31, 2025, and a non-cancelable purchase order backlog of $9.1 million as of June 30, 2024[131] - The company anticipates increased sales of mmWave products over the next 12 months as new customers are expected to commence production during 2024[131] Indemnification Agreements - The company has entered into contractual arrangements for indemnifications related to breaches of representations and warranties, with no material amounts reflected in the financial statements for the three and six months ended June 30, 2024[155] - Indemnification agreements have been established with the company's officers and directors, but no significant financial impact has been reported[155]