MicroVision, Inc. — FY2022 Form 10-K
Reporting period: Fiscal year ended December 31, 2022. The filing was signed March 1, 2023. MicroVision develops lidar hardware and software, with a primary focus on automotive ADAS and autonomous-driving applications. Its 2022 revenue came entirely from royalties from Microsoft.
Financial results and position
Amounts below are in U.S. dollars; financial statement amounts are in millions except per-share data.
| Metric | 2022 | 2021 | Change / context |
|---|---|---|---|
| Revenue | $0.664 | $2.500 | Down 73.4%; all revenue was license and royalty revenue from one customer. |
| Gross profit | $0.564 | $2.498 | Reported 2022 gross margin was approximately 84.9%; 2022 cost of product revenue included inventory write-downs. |
| Research and development | $30.413 | $24.111 | Up 26.1%, primarily from higher personnel and facilities costs. |
| Sales, marketing, general and administrative | $24.041 | $22.256 | Up 8.0%. |
| Operating loss | $(53.890) | $(43.869) | Loss widened as expenses increased. |
| Net loss | $(53.091) | $(43.200) | Loss per share was $(0.32), versus $(0.27). |
| Cash used in operating activities | $(38.019) | $(29.404) | Higher operating costs to develop lidar and software. |
| Cash and cash equivalents | $20.536 | $82.647 | At December 31, 2022. |
| Available-for-sale investments | $62.173 | $32.720 | All scheduled to mature in less than one year. |
| Total assets | $114.996 | $130.225 | |
| Total liabilities | $25.255 | $17.471 | Includes $15.675 million of operating lease liabilities. |
- Cash, cash equivalents, and investments totaled $82.709 million at year-end. Cash used in investing activities was $38.073 million, including net purchases of short-term investments, property and equipment spending, and a $4.132 million advance to Ibeo. Financing activities provided $14.307 million, principally from $13.999 million of common-stock issuance proceeds.
- The balance sheet reported no current portion of long-term debt at year-end; finance lease obligations totaled $21,000. The company made $392,000 of principal payments on its PPP loan during 2022.
- Share count increased from 164.363 million at December 31, 2021 to 170.503 million at December 31, 2022. The company issued 4.3 million shares under its ATM program in 2022 for net proceeds of $14.0 million.
Material changes and significant events
- Revenue fell to $664,000 from $2.5 million. Microsoft remained the sole customer and accounted for 100% of 2022 revenue. No shipments reported by the customer in the second half of 2022 generated royalties.
- Royalties are applied against a $10 million customer prepayment received in 2017; $5.4 million had been applied by year-end 2022. Accordingly, 2022 royalty revenue did not generate cash receipts unless and until the prepayment is exhausted.
- Operating expenses increased by $8.087 million overall; R&D rose $6.302 million and sales, marketing, general and administrative expense rose $1.785 million. The company reported an accumulated deficit of $682.524 million.
- After year-end, on January 31, 2023, MicroVision completed its acquisition of certain Ibeo Automotive Systems assets for a stated purchase price of EUR 15 million, approximately $16.1 million, subject to adjustments. MicroVision advanced approximately $7.1 million to Ibeo before closing, paid approximately $7.6 million to Ibeo and $3.3 million into escrow at closing, and expected a remaining payment in Q2 2023. The filing says some advance and headcount-reduction costs are to be reimbursed through purchase-price deductions.
- The acquisition added automotive lidar, perception and validation software, industrial products, employees and intellectual property. These acquired operations were not included in 2022 revenue. MicroVision reported approximately 295 engineering and technical staff after closing and approximately 350 total employees as of February 24, 2023.
Outlook, risks, and other notable disclosures
- Management forecast small quantities of sales in 2023 but did not expect significant, sustained ADAS revenue in the near term. It expected a significant loss in 2023 and anticipated continued significant losses and negative cash flow at least through 2023 and likely thereafter.
- Management stated that, based on its current operating plan, available cash and cash equivalents would fund operations for at least the next 12 months. This assessment should be considered alongside continued operating cash burn, acquisition-related spending, rising expenses, and potential need for additional capital.
- Key risks include failure to win automotive production awards or secure additional customers; intense competition and alternative camera/radar technologies; lengthy customer qualification and vehicle-program timelines; reliance on limited-source suppliers and third parties; supply-chain disruptions; execution and integration risks from the Ibeo acquisition; and possible future equity dilution or difficulty raising capital.
- The company estimated a cumulative potential lidar revenue opportunity of approximately $82 billion for 2025–2030, based on its assumed sensor adoption and average selling prices. This is a company estimate, not contracted revenue or guidance.
- COVID-19, supplier capacity and component availability, hybrid work, and restrictions on travel and customer engagement were described as potential sources of development and business-development disruption. The filing also cites inflationary pressure on labor costs and geopolitical and economic uncertainty.
- MicroVision disclosed ongoing claims and threatened lawsuits in the ordinary course, but management did not believe any current proceeding was reasonably likely to have a material adverse effect. The auditor gave an unqualified opinion on the financial statements and internal controls; no critical audit matters were identified.
Important facts for investors to verify
- Whether MicroVision converts product development and customer discussions into automotive production awards, and the timing, scale, pricing, and economics of any resulting revenue.
- Actual cash burn, remaining liquidity after the Ibeo acquisition and final purchase-price payment, and whether additional equity or debt financing is needed; monitor dilution under the ATM program.
- Whether Microsoft-reported shipments resume and how much of the $4.6 million remaining contract liability is recognized, given that recognition depends on future customer shipments.
- Integration progress, costs, employee retention, customer relationships, and commercial contribution from the Ibeo assets.
- Whether 2023 small-quantity sales and management’s 12-month funding assessment were achieved; the filing does not provide a firm revenue target or a path to profitability.
- Risks from customer concentration, supplier availability, long automotive qualification cycles, competition, and the assumptions underlying the company’s market-size estimate.