Amprius Technologies, Inc. — Q1 2023 Form 10-Q
Reporting period: Three months ended March 31, 2023; comparative period is Q1 2022. Financial statements are unaudited. Amprius develops and commercially produces silicon-anode lithium-ion batteries, primarily for aviation and other mobility applications. Production remained at kWh scale.
Financial results and liquidity
| Metric | Q1 2023 | Q1 2022 |
|---|---|---|
| Revenue | $0.679 million | $2.110 million |
| Gross loss / margin | $(3.425) million / (504)% | $(1.039) million / (49)% |
| Operating expenses | $6.326 million | $1.871 million |
| Operating loss | $(9.751) million | $(2.910) million |
| Net loss | $(9.102) million | $(2.878) million |
| Net loss per share, basic and diluted | $(0.11) | $(0.04) |
| Cash used in operating activities | $(6.492) million | $(3.043) million |
| Cash used in investing activities | $(1.140) million | $(0.034) million |
| Cash provided by financing activities | $2.123 million | $0.204 million |
At March 31, 2023, cash and cash equivalents were $64.2 million, total current assets $69.9 million, current liabilities $8.9 million, total liabilities $16.9 million, and stockholders’ equity $67.0 million. The company reported no interest-bearing borrowings. Accumulated deficit was $102.0 million. Management believes cash will fund operating and capital requirements for at least twelve months from issuance of the statements.
Revenue included $0.470 million from battery sales and $0.209 million of government grant revenue; there was no customized design-services revenue in the quarter. The filing reports approximately $11.0 million of remaining customer performance obligations, including deferred revenue, with about $7.1 million expected to be recognized within one year.
Changes versus Q1 2022
- Revenue declined 68%, primarily because the prior-year quarter included $1.5 million of non-recurring customized design-services revenue. Battery-product revenue also decreased by approximately $0.1 million; current-period government grant revenue partly offset the decline.
- Cost of revenue rose 30% despite lower revenue, producing a substantially wider gross loss. The increase included higher outside services and consulting costs, including a non-recurring cost related to selecting the Brighton manufacturing site.
- Operating expenses increased 238%. SG&A rose mainly with public-company costs, professional fees, personnel, insurance and recruiting; R&D increased with personnel-related development costs.
- Operating cash use more than doubled, reflecting higher personnel, professional-services and insurance costs. Investing cash use increased with production equipment purchases and facility improvements.
Outlook, risks and unusual items
- Manufacturing expansion: The company is expanding Fremont operations and expects a newly received large-scale anode production machine to raise silicon-anode capacity to approximately 2 MWh by year-end 2023. Its initial 500 MWh phase at a planned large-scale facility is expected to be operational in 2025. Management estimates $120–$150 million of capital equipment expenditures to reach 1.0 GWh of annual capacity; the company cautions that timing, costs and production performance remain uncertain.
- Brighton facility: On April 15, 2023, the company entered into a lease for approximately 774,000 square feet, with future lease payments of about $62.9 million beginning in December 2024. Current zoning does not permit battery manufacturing; rezoning and permits are prerequisites, and the lease automatically terminates if rezoning is not approved. The company expects rezoning by September 2023, but gives no assurance it will succeed.
- Funding: Up to $197.6 million remained available under the optional B. Riley equity financing at March 31, 2023, subject to contractual, share-registration and market conditions. The company sold 331,351 shares for $2.4 million gross proceeds in Q1. A $50 million DOE cost-sharing grant is conditional on negotiating a final contract and meeting its terms; it was not assured funding. Additional equity financing could dilute shareholders.
- Other subsequent event: On May 9, 2023, Amprius entered into a merger agreement with its controlling stockholder, Amprius Holdings. Completion requires conditions including approval by unaffiliated stockholders; the transaction would issue shares to Holdings’ stockholders and convert Holdings options and warrants.
- Controls: Disclosure controls were assessed as ineffective because previously identified material weaknesses in financial reporting controls and segregation of duties remained unremediated at March 31, 2023. Remediation efforts were ongoing; management said additional procedures supported the fair presentation of the interim statements.
- Principal risks: Scaling manufacturing and achieving acceptable yield, quality and costs; Brighton rezoning, permitting and construction; future capital needs; competition and customer concentration; supplier and supply-chain constraints; product safety and liability; and continued operating losses. Three customers represented 76% of Q1 revenue. Management expects further losses and increased operating and capital expenditures.
- Potential dilution: 47.7 million warrants were outstanding at March 31, 2023, with exercise prices of $11.50 or $12.50 per share. Their exercise is not assured. The company also disclosed significant potential share resales and lock-up expirations.
Important facts for investors to verify
- Progress on Brighton rezoning, permits, construction plans, lease obligations and the targeted 2025 initial production phase.
- Final DOE grant contract terms, eligible costs, matching requirements and whether funding is ultimately received.
- Cash burn, capital spending and the practical availability and dilution impact of the remaining B. Riley equity facility.
- Customer concentration, order conversion, remaining performance obligations and the revenue mix between product sales, services and grants.
- Progress in remediating internal-control material weaknesses and subsequent reporting on control effectiveness.
- Status and shareholder approval of the Amprius Holdings merger, plus potential dilution from warrants, equity plans and share resales.