Airspan Networks Holdings Inc. Reports 2021 Results, With Strong Momentum in 5G Private Networks, Continued Fixed Wireless Access Expansion, Key Partnerships With Tech’s Most Admired Companies

Apr 11th, 2022 21:45 EST

BOCA RATON, Fla.–(BUSINESS WIRE)–Airspan Networks Holdings Inc. (NYSE American: MIMO), which provides ground-breaking, disruptive software and hardware for 5G networks, and a pioneer in end-to-end Open RAN solutions, today announced results for the fourth quarter and year ended December 31, 2021.

Key Fourth Quarter Financial Highlights

  • Revenue of $50.4 million, up 29% sequentially from third quarter 2021, down 38% year-over-year compared to exceptional performance in fourth quarter 2020, following COVID lockdowns
  • Gross margin of 41.1% compared to 44.0% in third quarter 2021, and 45.8% in fourth quarter 2020, with the majority of the variance due to supply chain pressures.
  • Net loss of $19.6 million, compared to a net loss of $27.0 million in third quarter 2021, and net income of $8.3 million for fourth quarter 2020
  • Adjusted EBITDA (non-GAAP measure) was a loss of $8.0 million compared to a loss of $10.4 million in third quarter 2021 and income of $12.7 million in fourth quarter 2020
  • Loss per share was 27 cents, compared to income per share of 14 cents in the fourth quarter 2020.

Fourth Quarter Successes and Recognition

  • Strengthening strong CBRS market position with the launch of Airspan’s first 5G CBRS product: the Airspan AirStrand 2200 solution was the first CBRS 5G Stand Alone small cell radio approved by the FCC for use on US networks. It follows the successful completion of 5G interoperability tests in the CBRS spectrum band (n48), which lays the groundwork for the launch of next generation CBRS-based devices using Airspan 5G and Open RAN software and hardware for cable operator customers and other vertical markets.
  • One of the “Best Pilot Programs” In the US/Fixed Wireless Access Market: Mimosa by Airspan beat out its FWA and Wi-Fi solutions competitors to win the RAN provider business for Amarillo, Texas’ government stimulus-funded Digital Divide program, Amarillo Connected. In addition, Airspan extended its sales resources aggressively to capture business via stimulus revenue, leveraging Airspan’s leading FWA portfolio across a multitude of broadband connectivity programs.
  • Leveraging international government stimulus for 5G deployments: In addition to US government stimulus funding broadband deployments, Airspan is a member in a consortium of industry and academic partners that secured funding from the UK Department of Digital, Culture, Media and Sport (DCMS).

Full Year 2021 Financial Highlights

  • Began trading as a public company on August 16, 2021 under the ticker symbol, MIMO
  • Annual revenue of $177.3 million, up 3% year-over-year compared to 2020
  • Product and software license revenue up 13% year-over-year compared to 2020
  • Gross margin of 44% compared to 48.6% in 2020
  • Net loss of $70.5 million, compared to a net loss of $25.6 million for the full year 2020
  • Adjusted EBITDA (non-GAAP measure) was a loss of $29.1 million, compared to a loss of $9.4 million for the full year 2020
  • Loss per share was $1.09, compared to a loss per share of 43 cents for the full year 2020.

Full Year 2021 Successes and Recognition

Stonestrom Appointed Chairman

Airspan’s CEO Eric Stonestrom has been appointed chairman of the Company’s board of directors. He replaces Tom Huseby, who continues to serve on the board.

Supply Chain Update

Demand for our products is strong, though supply chain challenges are still leading to increasingly long lead times. We continue to work hard in a number of ways to mitigate these challenges, finding alternative components, instituting multiple technological design changes and working closely with our partners. In this environment supply chain pressures center primarily around component availability, higher spot purchase prices for hardware components and increased shipping costs. While we have begun to pass some of these expenses on to customers through price increases, we expect the increased cost impact of components and freight to continue. We anticipate such supply chain challenges to extend through 2022.

Relationships with Some of the Tech World’s Most Admired Companies: AWS, Cisco, Dell, HPE and Qualcomm

“We are seeing an explosion of interest in enterprise 5G private network solutions,” said Airspan Chairman and CEO Eric Stonestrom. “In conjunction, we recently announced several key partnerships and working relationships with some of tech’s most admired companies, while at Mobile World Congress. These partnerships include Amazon Web Services (AWS), Cisco, Dell, HPE and Qualcomm, as we ramp up our private networks capabilities and portfolio.”

New President/COO Named to Execute Growth Strategy

Airspan recently named Glenn Laxdal as its new President and COO, to execute the growth strategy and scale the business, overseeing operations, customer service and product management divisions, along with the Broadband Airspan by Mimosa organization. Laxdal is a senior technology executive with over 25 years of global experience in the wireless, software and computing industries.

“Bringing on the right leaders with the ability and experience to execute on our aggressive plans is a critical component of our strategy for long-term, sustainable growth,” said Stonestrom. “Glenn is focused on accelerating our plans to grow revenue and market share to take advantage of the tremendous market opportunities for 5G, Open RAN, Private Networks and Fixed Wireless Access (FWA) solutions.”

Business Outlook

We anticipate first quarter 2022 revenue of approximately $38 million with gross margin of approximately 32%. Both figures were impacted by significant supply chain costs and challenges from COVID-19 restrictions in Asia.

The information with respect to first quarter 2022 above is preliminary, based upon Airspan’s estimated and currently available information and is subject to revision based upon, among other things, Airspan’s financial closing procedures. The Company’s actual results may differ from these estimates due to the completion of its financial closing procedures and final adjustments and other developments that may arise between the date of this news release and the time the Company’s condensed consolidated financial statements for the first quarter 2022 are completed. Readers are cautioned not to place undue reliance on these estimates.

Earnings Conference Call

A conference call with Airspan executives will be held tomorrow, Tuesday, April 12 at 8:30 am ET. It can be accessed through a toll-free dial-in, 1-877-589-7296, or 1-215-268-9906 (local), by requesting the Airspan call, as well as on the Airspan investor relations website, ir.airspan.com/. An audio replay will be available on the Airspan investor relations site following the call.

About Airspan

Airspan Networks Holdings Inc. (NYSE American: MIMO) is a U.S.-based provider of groundbreaking, disruptive software and hardware for 5G networks, and a pioneer in end-to-end Open RAN solutions that provide interoperability with other vendors. As a result of innovative technology and significant R&D investments to build and expand 5G solutions, Airspan believes it is well-positioned with 5G indoor and outdoor, Open RAN, private networks for enterprise customers and industrial use applications, fixed wireless access (FWA), and CBRS solutions to help mobile network operators of all sizes deploy their networks of the future, today. With over one million cells shipped to 1,000 customers in more than 100 countries, Airspan has global scale. For more information, visit www.airspan.com.

Cautionary Statement Regarding Forward-Looking Statements

This news release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about future financial and operating results, Airspan’s plans, objectives, expectations and intentions with respect to future operations, products and services; projected financial performance, and other statements identified by words such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. Any such forward-looking statements are based upon the current beliefs and expectations of Airspan’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond Airspan’s control.

Actual results, performance or achievements may differ materially, and potentially adversely, from any forward-looking statements and the assumptions on which those forward-looking statements are based. There can be no assurance that the data contained herein is reflective of future performance to any degree. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance as projected financial information and other information are based on estimates and assumptions that are inherently subject to various significant risks, uncertainties and other factors, many of which are beyond Airspan’s control, which may include, among other things: the risk of downturns and the possibility of rapid change in the highly competitive industry in which we operate; changes in laws and regulations affecting our business; the risk that we and our current and future collaborators are unable to successfully develop and commercialize our products or services, or experience significant delays in doing so; the risk that we do not achieve or sustain profitability; the risk that we will need to raise additional capital to execute our business plan, which may not be available on acceptable terms or at all; the risk that we experience difficulties in managing our growth and expanding operations; the risk that third-party suppliers and manufacturers are not able to fully and timely meet their obligations; the risk of product liability or regulatory lawsuits or proceedings relating to our products and services; and the risk that we are unable to secure our intellectual property. For further information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the U.S. Securities and Exchange Commission. All information set forth herein speaks only as of the date hereof in the case of information about Airspan or the date of such information in the case of information from persons other than Airspan, and we disclaim any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this communication. Forecasts and estimates regarding Airspan’s industry and end markets are based on sources we believe to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part.

Non-GAAP Measures

This news release references non-GAAP measures. Non-GAAP measures do not have a standardized meaning and are, therefore, unlikely to be comparable to similar measures presented by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation of, or as a substitute for, the financial information prepared and presented in accordance with GAAP. Non-GAAP financial measures referred to in this report are labeled as “non-GAAP measure.”

AIRSPAN NETWORKS HOLDINGS INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except for share data)

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

2021

 

2020

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

62,937

 

 

$

18,196

 

Restricted cash

 

 

185

 

 

 

422

 

Accounts receivable, net of allowance of $309 and $374 at December 31, 2021 and 2020, respectively

 

 

57,980

 

 

 

70,621

 

Inventory

 

 

17,217

 

 

 

12,019

 

Prepaid expenses and other current assets

 

 

18,833

 

 

 

8,602

 

Total current assets

 

 

157,152

 

 

 

109,860

 

Property, plant and equipment, net

 

 

7,741

 

 

 

4,833

 

Goodwill

 

 

13,641

 

 

 

13,641

 

Intangible assets, net

 

 

6,438

 

 

 

7,629

 

Right-of-use assets, net

 

 

6,585

 

 

 

7,882

 

Other non-current assets

 

 

3,942

 

 

 

3,837

 

Total assets

 

$

195,499

 

 

$

147,682

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

29,709

 

 

$

36,849

 

Deferred revenue

 

 

2,902

 

 

 

7,521

 

Other accrued expenses

 

 

26,967

 

 

 

22,538

 

Senior term loan, current portion

 

 

3,187

 

 

 

 

Subordinated debt

 

 

10,577

 

 

 

10,065

 

Current portion of long-term debt

 

 

275

 

 

 

298

 

Total current liabilities

 

 

73,617

 

 

 

77,271

 

Long-term debt

 

 

 

 

 

2,087

 

Subordinated term loan – related party

 

 

37,991

 

 

 

34,756

 

Senior term loan

 

 

37,876

 

 

 

36,834

 

Convertible debt

 

 

41,343

 

 

 

 

Other long-term liabilities

 

 

20,924

 

 

 

17,147

 

Total liabilities

 

 

211,751

 

 

 

168,095

 

 

 

 

 

 

 

 

 

 

Stockholders’ deficit:

 

 

 

 

 

 

 

 

Common stock, $0.0001 par value; 250,000,000 shares authorized; 72,335,952 and 59,710,047 shares issued and outstanding at December 31, 2021 and 2020, respectively

 

 

7

 

 

 

6

 

Additional paid-in capital

 

 

749,592

 

 

 

674,906

 

Accumulated deficit

 

 

(765,851

)

 

 

(695,325

)

Total stockholders’ deficit

 

 

(16,252

)

 

 

(20,413

)

Total liabilities and stockholders’ deficit

 

$

195,499

 

 

$

147,682

 

AIRSPAN NETWORKS HOLDINGS INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except for share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended
December 31,

 

 

Year Ended
December 31,

 

 

 

2021

 

2020

 

2021

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Products and software licenses

 

$

44,684

 

 

$

73,818

 

 

$

151,172

 

 

$

134,338

 

Maintenance, warranty and services

 

 

5,692

 

 

 

7,728

 

 

 

26,111

 

 

 

38,617

 

Total revenues

 

 

50,376

 

 

 

81,546

 

 

 

177,283

 

 

 

172,955

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Products and software licenses

 

 

28,836

 

 

 

43,196

 

 

 

95,442

 

 

 

84,375

 

Maintenance, warranty and services

 

 

849

 

 

 

1,031

 

 

 

3,870

 

 

 

4,477

 

Total cost of revenues

 

 

29,685

 

 

 

44,227

 

 

 

99,312

 

 

 

88,852

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

20,691

 

 

 

37,319

 

 

 

77,971

 

 

 

84,103

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

15,923

 

 

 

13,906

 

 

 

63,350

 

 

 

52,858

 

Sales and marketing

 

 

8,682

 

 

 

7,274

 

 

 

33,839

 

 

 

28,738

 

General and administrative

 

 

12,631

 

 

 

4,565

 

 

 

40,878

 

 

 

16,555

 

Amortization of intangibles

 

 

294

 

 

 

359

 

 

 

1,191

 

 

 

1,733

 

Loss on sale of assets

 

 

 

 

 

 

 

 

 

 

 

22

 

Total operating expenses

 

 

37,530

 

 

 

26,104

 

 

 

139,258

 

 

 

99,906

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income from operations

 

 

(16,839

)

 

 

11,215

 

 

(61,287

)

 

 

(15,803

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

(4,233

)

 

 

(1,746

)

 

 

(12,813

)

 

 

(6,422

)

Change in fair value of warrant liability and derivatives, net

 

 

895

 

 

 

(1,566

)

 

 

4,116

 

 

 

(3,322

)

Gain on extinguishment of debt

 

 

 

 

 

 

 

 

2,096

 

 

 

 

Other expense, net

 

 

(743

)

 

 

(709

)

 

 

(3,328

)

 

 

(878

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income before income taxes

 

 

(20,920

)

 

 

7,194

 

 

(71,216

)

 

 

(26,425

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax benefit

 

 

1,314

 

 

1,152

 

 

690

 

 

782

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(19,606

)

 

$

8,346

 

$

(70,526

)

 

$

(25,643

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) earnings per share – basic and diluted

 

$

(0.27

)

 

$

0.14

 

$

(1.09

)

 

$

(0.43

)

Weighted average shares outstanding – basic and diluted

 

 

72,183,563

 

 

 

59,710,047

 

 

 

64,509,718

 

 

 

59,710,047

 

 

AIRSPAN NETWORKS HOLDINGS INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended
December 31,

 

 

2021

 

2020

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net loss

 

$

(70,526

)

 

$

(25,643

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

4,294

 

 

 

4,640

 

Foreign exchange (gain) loss on long-term debt

 

 

(14

)

 

 

26

 

Gain on extinguishment of debt

 

 

(2,096

)

 

 

 

Change in fair value of warrants and derivatives

 

 

(7,940

)

 

 

 

Share-based compensation expense

 

 

10,577

 

 

 

2,643

 

Loss on disposal of property, plant and equipment

 

 

22

 

 

 

3

 

Bad debt expense

 

 

289

 

 

 

5

 

Total adjustments

 

 

5,132

 

 

 

7,317

 

 

 

 

 

 

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Decrease (increase) in accounts receivable

 

 

12,352

 

 

 

(30,345

)

(Increase) decrease in inventory

 

 

(5,198

)

 

 

5,123

 

Decrease in prepaid expenses and other current assets

 

 

(6,547

)

 

 

(517

)

Increase in other operating assets

 

 

(105

)

 

 

(380

)

(Decrease) increase in accounts payable

 

 

(10,790

)

 

 

12,012

 

Increase in deferred revenue

 

 

(4,619

)

 

 

(2,514

)

Increase in other accrued expenses

 

 

4,429

 

 

 

5,104

 

Increase in other long-term liabilities

 

 

616

 

 

 

5,889

 

Increase in accrued interest on long-term debt

 

 

8,571

 

 

 

3,587

 

Net cash used in operating activities

 

 

(66,685

)

 

 

(20,367

)

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Purchase of property, plant and equipment

 

 

(6,033

)

 

 

(2,226

)

Net cash used in investing activities

 

 

(6,033

)

 

 

(2,226

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Repayments of line of credit, net

 

 

 

 

 

(1,993

)

Borrowings under senior term loan

 

 

 

 

 

6,005

 

Borrowings under other long-term debt

 

 

 

 

 

2,073

 

Proceeds from the Business Combination, issuance of convertible debt and PIPE financing, net of issuance costs paid

 

 

115,501

 

 

 

 

Proceeds from the exercise of stock options

 

 

1,074

 

 

 

 

Proceeds from the sale of Series G stock, net

 

 

 

 

 

21,913

 

Proceeds from the sale of Series H stock, net

 

 

505

 

 

 

8,074

 

Proceeds from the issuance of Series H warrants

 

 

142

 

 

 

2,126

 

Net cash provided by financing activities

 

 

117,222

 

 

 

38,198

 

 

 

 

 

 

 

 

 

 

Net increase in cash, cash equivalents and restricted cash

 

 

44,504

 

 

 

15,605

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash, beginning of year

 

 

18,618

 

 

 

3,013

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash, end of year

 

$

63,122

 

 

$

18,618

 

The following tables present the reconciliation of net (loss) income, the most directly comparable GAAP measure, to Adjusted EBITDA:

 

 

 

Three Months Ended

 

 

Dec. 31,

 

Sept. 30,

($ in thousands)

 

2021

 

2021

Net loss

 

$

(19,606

)

 

$

(26,953

)

 

 

 

 

 

 

 

 

 

Adjusted for:

 

 

 

 

 

 

 

 

Interest expense

 

 

4,233

 

 

 

3,630

 

Income tax (benefit) charge

 

 

(1,314

)

 

 

457

Depreciation and amortization

 

 

1,177

 

 

 

988

 

EBITDA

 

 

(15,510

)

 

 

(21,878

)

Share-based compensation expense

 

 

8,427

 

 

 

661

 

Change in fair value of warrant liability and derivatives

 

 

(895

)

 

 

(11,562

)

Transaction costs allocated to the warrants

 

 

 

 

 

3,824

 

Management Incentive Plan expense related to Business Combination

 

 

 

 

 

18,513

 

Adjusted EBITDA

 

$

(7,978

)

 

$

(10,442

)

 

 

Three Months Ended
December 31,

($ in thousands)

 

2021

 

2020

Net (loss) income

 

$

(19,606

)

 

$

8,346

 

 

 

 

 

 

 

 

 

Adjusted for:

 

 

 

 

 

 

 

 

Interest expense

 

 

4,233

 

 

 

1,746

 

Income tax benefit

 

 

(1,314

)

 

 

(1,152

)

Depreciation and amortization

 

 

1,177

 

 

 

1,016

 

EBITDA

 

 

(15,510

)

 

 

9,956

Share-based compensation expense

 

 

8,427

 

 

 

1,161

 

Change in fair value of warrant liability and derivatives

 

 

(895

)

 

 

1,566

 

Adjusted EBITDA

 

$

(7,978

)

 

$

12,683

 

 

Year Ended
December 31,

($ in thousands)

 

2021

 

2020

Net loss

 

$

(70,526

)

 

$

(25,643

)

 

 

 

 

 

 

 

 

 

Adjusted for:

 

 

 

 

 

 

 

 

Interest expense

 

 

12,813

 

 

 

6,422

 

Income tax benefit

 

 

(690

)

 

 

(782

)

Depreciation and amortization

 

 

4,294

 

 

 

4,640

 

EBITDA

 

 

(54,109

)

 

 

(15,363

)

Share-based compensation expense

 

 

10,577

 

 

 

2,643

 

Change in fair value of warrant liability and derivatives

 

 

(7,940

)

 

 

3,322

 

Transaction costs allocated to the warrants

 

 

3,824

 

 

 

 

Management Incentive Plan expense related to Business Combination

 

 

18,513

 

 

 

 

Adjusted EBITDA

 

$

(29,135

)

 

$

(9,398

)

 

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