Movano Inc. Form 10-Q — Quarter Ended September 30, 2023
Filing identity: The supplied filing identifies the registrant as Movano Inc. (doing business as Movano Health), not Corvex, Inc. Figures below are in U.S. dollars; financial statement amounts are generally in millions unless noted.
Business context and reporting period
Movano is a development-stage health technology company developing consumer and medical wearables. Its initial proposed commercial product is the Evie Ring; it is also developing sensor technology for non-invasive glucose and cuffless blood pressure monitoring. The company reported results for the three and nine months ended September 30, 2023. It had not launched its first product or recorded revenue as of quarter-end.
Key financial metrics
| Metric | Q3 2023 | Q3 2022 | Nine months 2023 | Nine months 2022 |
|---|---|---|---|---|
| Revenue | None reported | None reported | None reported | None reported |
| Research and development expense | $5.6 | $5.1 | $13.7 | $13.8 |
| Sales, general and administrative expense | $3.4 | $3.5 | $10.0 | $8.6 |
| Total operating expenses / operating loss | $9.1 | $8.7 | $23.7 | $22.4 |
| Net loss | $9.0 | $8.6 | $23.3 | $22.4 |
| Net loss per share, diluted | $0.18 | $0.26 | $0.53 | $0.68 |
| Cash used in operating activities | Not presented by quarter | Not presented by quarter | $20.9 | $18.6 |
At September 30, 2023, cash and cash equivalents were $7.7 million, current assets $9.2 million, current liabilities $5.5 million, total liabilities $5.6 million, and stockholders’ equity $4.9 million. The filing reports no borrowings or debt balance; lease liabilities totaled $0.3 million. Gross margin is not meaningful because the company had no revenue.
Material changes versus the prior comparable period
- Q3 net loss increased by $0.4 million year over year; operating expenses rose 5%, mainly as R&D increased by $0.5 million.
- Nine-month net loss increased by $0.9 million. SG&A rose $1.4 million, partly offset by a $0.1 million reduction in R&D.
- Nine-month operating cash use increased by $2.3 million. Cash declined $3.1 million from year-end 2022 despite $17.9 million in financing cash inflows.
- Equity financing included February and June public offerings and ATM sales. Shares outstanding rose from 33.7 million at December 31, 2022 to 50.8 million at September 30, 2023.
Outlook, risks and unusual items
- Management expects continuing losses and significant expenses for at least the next several years. It stated that quarter-end cash was expected to support completion and initial commercial launch of the Evie Ring, but would not fund operations for the next 12 months after the financial statements were issued.
- The filing states that substantial doubt exists about the company’s ability to continue as a going concern within one year after issuance. Additional capital is required; unavailable or unfavorable financing could force delays, reductions or termination of development or commercialization efforts.
- Movano filed a 510(k) submission for the Evie Ring’s pulse oximeter in July 2023 and was corresponding with the FDA on review comments. The filing does not provide a clear expected clearance date. The company expects an initial wellness-device launch without FDA premarket clearance and plans to seek clearance for vital-sign monitoring capabilities.
- In November 2023, the board authorized a public offering of common stock, with size, pricing and other terms to be determined. The company also had approximately $44.5 million of capacity remaining under its ATM program at September 30, 2023.
- Disclosure controls and procedures were deemed ineffective due to a previously identified material weakness involving financial close and reporting controls, account reviews and analyses, and certain IT general controls. Remediation efforts were ongoing.
- Management reported no pending legal proceedings believed to have a material adverse effect. Third-party manufacturing dependence, regulatory approvals, product development and commercialization, competition, intellectual property, and financing are among the stated risks.
Important facts for investors to verify
- Confirm the intended issuer: the supplied filing is Movano Inc., although the request metadata names Corvex, Inc.
- Track cash burn, financing proceeds and timing, including the terms and dilution from any subsequent public offering or ATM sales.
- Verify Evie Ring launch progress, commercial demand, and the status and timing of FDA review; the filing reports no revenue to date.
- Assess whether the company can fund operations beyond the stated near-term launch plan and address the going-concern uncertainty.
- Monitor remediation of the material weakness and whether disclosure controls become effective.