Peraso(PRSO) - 2024 Q3 - Quarterly Report

Financial Performance - Net losses of approximately $9.2 million for the nine months ended September 30, 2024 and$16.8 million for the year ended December 31, 2023, with an accumulated deficit of approximately $175.6 million as of September 30, 2024[140] - The company incurred net losses of$9.2 million for the nine months ended September 30, 2024 and $16.8 million for the year ended December 31, 2023, raising substantial doubt about its ability to continue as a going concern[170][172] Revenue and Sales - Product revenue decreased by 11$3.811 million for the three months ended September 30, 2024, compared to $4.262 million in the same period of 2023[145] - Product revenue decreased by 7$10.596 million for the nine months ended September 30, 2024, compared to $11.385 million in the same period of 2023[145] - Memory IC product shipments increased to$3.677 million for the three months ended September 30, 2024, compared to $3.384 million in the same period of 2023[146] - mmWave IC product shipments decreased to$67,000 for the three months ended September 30, 2024, compared to $576,000 in the same period of 2023[146] - Non-cancelable purchase order backlog for memory IC products of$5.7 million as of September 30, 2024, with final shipments expected by March 31, 2025[147] - Royalty and other revenue decreased by 86% to $30,000 for the three months ended September 30, 2024, compared to$219,000 in the same period of 2023[149] - Royalty and other revenue decreased by 44% to $299,000 for the nine months ended September 30, 2024, compared to$531,000 in the same period of 2023[149] Cost and Expenses - Cost of net revenue decreased by 17% to $2.034 million for the three months ended September 30, 2024, compared to$2.445 million in the same period of 2023[150] - Cost of net revenue decreased by 26% to $5.431 million for the nine months ended September 30, 2024, compared to$7.346 million in the same period of 2023[150] - R&D expenses for the three months ended September 30, 2024 decreased by 38% to $2.2 million compared to$3.5 million in the same period of 2023, due to reduced salary and consulting costs[153][154] - R&D expenses for the nine months ended September 30, 2024 decreased by 31% to $7.6 million compared to$11.0 million in the same period of 2023[153] - SG&A expenses for the three months ended September 30, 2024 increased by 11% to $2.3 million compared to$2.1 million in the same period of 2023, primarily due to increased consulting and professional services costs[156][157] - SG&A expenses for the nine months ended September 30, 2024 increased by 4% to $6.6 million compared to$6.3 million in the same period of 2023[156] - The company recorded severance charges of approximately $0.4 million for each of the three and six months ended June 30, 2024, related to employee lay-offs[158] - The company expensed$1.6 million for non-cancelable software license commitments during the three months ended June 30, 2024[159] Gross Profit - Gross profit for the three months ended September 30, 2024 decreased by 11% to $1.8 million compared to$2.0 million in the same period of 2023, primarily due to decreased sales of mmWave IC and module products[152] - Gross profit for the nine months ended September 30, 2024 increased by 20% to $5.5 million compared to$4.6 million in the same period of 2023, driven by higher shipments of memory IC products[152] Liquidity and Capital Resources - As of September 30, 2024, the company had cash and cash equivalents of $1.3 million and working capital of$0.4 million[161] - The company's existing cash and cash equivalents as of September 30, 2024, along with proceeds from the warrant inducement offering and expected product sales, are projected to fund operating needs into Q2 2025[178] - Variability in the operating forecast, driven by product sales, customer licensing, NRE transactions, and timing of expenditures, could impact the company's cash runway[178] - The company may need to secure additional capital or financing, or significantly delay, defer, or reduce cash expenditures over the next two quarters to continue operations beyond the current forecast[179] Off-Balance Sheet Arrangements and Indemnifications - The company does not maintain any off-balance sheet arrangements that could materially affect its financial condition, results of operations, liquidity, or capital resources[180] - Indemnification agreements with officers and directors, as well as contractual indemnifications, are not reflected in the condensed consolidated financial statements for the three and nine months ended September 30, 2024[180]