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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-40690

 

RxSIGHT, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

94-3268801

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

100 Columbia

Aliso Viejo, CA

92656

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (949) 521-7830

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock, par value $0.001 per share

 

RXST

 

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

 

Smaller reporting company

 

 

 

 

 

 

 

 

 

 

 

 

Emerging growth company

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

As of July 31, 2022, the registrant had 27,638,899 shares of common stock, $0.001 par value per share, outstanding.

 

 

 


 

 

 

Page

PART I.

FINANCIAL INFORMATION

 

Item 1.

Financial Statements (Unaudited)

5

 

Condensed Consolidated Balance Sheets

5

 

Condensed Consolidated Statements of Operations and Comprehensive Loss

6

 

Condensed Consolidated Statements of Equity

7

 

Condensed Consolidated Statements of Cash Flows

9

 

Notes to Unaudited Condensed Consolidated Financial Statements

10

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

27

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

39

Item 4.

Controls and Procedures

39

PART II.

OTHER INFORMATION

 

Item 1.

Legal Proceedings

40

Item 1A.

Risk Factors

40

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

101

Item 3.

Defaults Upon Senior Securities

101

Item 4.

Mine Safety Disclosures

101

Item 5.

Other Information

101

Item 6.

Exhibits

102

Signatures

104

 

 


 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

The following discussion and analysis should be read together with our condensed consolidated financial statements and the condensed notes to those statements included elsewhere in this Quarterly Report on Form 10-Q. This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, that are based on our management’s beliefs and assumptions and on information currently available to our management. In this quarterly Report on Form 10-Q, “we,” “us” and “our” refer to RxSight, Inc., a Delaware corporation, and its consolidated subsidiaries.

Forward-looking statements include, but are not limited to, statements concerning the following:

our plans to conduct further clinical trials and any expectations related to the timing or outcomes of such trials;
our plans and expected timelines related to our products, or developing new products, to address additional indications or otherwise;
the expected acceptance and use of our products by doctors;
our ability to obtain, maintain and expand regulatory clearances for our products and any new products we create;
the expected growth of our business and our organization;
our intentions regarding investment in our business as we pursue growth;
our expected uses of our existing resources;
the expectations regarding government and third-party payer coverage and reimbursement;
our ability to recruit and retain key personnel, including the continued development of a sales and marketing infrastructure;
our ability to obtain an adequate supply of materials and components for our products from our third-party suppliers, including single- and sole-source suppliers;
our ability to manufacture sufficient quantities of our products with appropriate quality;
our ability to obtain, maintain and enforce intellectual property protection for our products and protect our intellectual property rights;
our ability to expand our business into new geographic markets;
our ability to comply with applicable SEC rules and Nasdaq continued listing requirements;
our ability to comply with existing and future government laws, rules and regulations both in the United States and internationally;
our expectations regarding allocation of resources toward expenses associated with being a public company;
our estimates of our expenses, ongoing losses, future revenue, capital requirements and our need for, or ability to obtain, additional financing;
the sufficiency of our existing capital resources to fund our future operating expenses and capital expenditure requirements;
the volatility of the trading price of our common stock;
our ability to identify and develop new and planned products and/or acquire new products;
development and projections relating to our competitors or our industry, including anticipated growth rates for the conventional and premium IOL markets;

 

3

 

 

 


 

the impact of local, regional, national and international economic conditions and events; and
the impact of the COVID-19 pandemic, including currently known and unknown coronavirus variants, on our business or personnel.

Forward-looking statements include statements that are not historical facts and can be identified by terminology such as “may,” “will,” “should,” “could,” “would,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” or “continue,” or the negative of such terms and other same terminology.

Forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. We discuss these risks in greater detail in Part II, Item 1A, “Risk Factors,” elsewhere in this Quarterly Report on Form 10-Q. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this Quarterly Report on Form 10-Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

DISCUSSION AND ANALYSIS OF OUR FINANCIAL CONDITION

Our discussion and analysis of our financial condition and results of operations is based upon our unaudited condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States, or (“GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. On an ongoing basis, we evaluate our estimates including those related to revenue recognition; valuation of the Company’s warrants and other equity awards; estimated probability and timing of redemption of equity instruments, the realization of income tax assets and estimates of tax liabilities, and obsolete, excess and slow-moving inventory. We base our estimates on historical experience and on various other assumptions we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities not readily apparent from other sources. Actual results may differ materially from these estimates. Our critical accounting policies and estimates are discussed in in the Company’s Annual Report on Form 10-K filed with the SEC on March 8, 2022.

INDUSTRY, BUSINESS AND MARKET DATA

This Quarterly Report on Form 10-Q also contains estimates, projections and other information concerning our industry, our business, and market opportunity, including data regarding the estimated size of the market. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained this industry, business, market and other data from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data and similar sources.

TRADEMARKS, SERVICE MARKS AND TRADE NAMES

This Quarterly Report on Form 10-Q contains references to trademarks and service marks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this Quarterly Report on Form 10-Q may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of it by, any other companies.

 

4

 

 

 


 

Item 1: Financial Statements (Unaudited)

RxSIGHT, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

 

 

 

June 30,

 

 

December 31,

 

 

 

2022

 

 

2021

 

 

 

(Unaudited)

 

 

 

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

24,004

 

 

$

24,361

 

Short-term investments

 

 

104,616

 

 

 

134,971

 

Accounts receivable

 

 

6,884

 

 

 

4,862

 

Inventories

 

 

11,622

 

 

 

8,032

 

Prepaid and other current assets

 

 

2,802

 

 

 

4,069

 

Total current assets

 

 

149,928

 

 

 

176,295

 

Property and equipment, net

 

 

11,083

 

 

 

11,217

 

Operating leases right-of-use assets

 

 

4,704

 

 

 

4,284

 

Restricted cash

 

 

811

 

 

 

811

 

Other assets

 

 

188

 

 

 

114

 

Total assets

 

$

166,714

 

 

$

192,721

 

Liabilities and stockholders' equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

3,277

 

 

$

1,689

 

Accrued expenses and other current liabilities

 

 

7,877

 

 

 

7,859

 

Lease liabilities

 

 

1,842

 

 

 

1,529

 

Total current liabilities

 

 

12,996

 

 

 

11,077

 

Long-term lease liabilities

 

 

3,851

 

 

 

3,642

 

Term loan, net

 

 

39,881

 

 

 

39,760

 

Total liabilities

 

 

56,728

 

 

 

54,479

 

Commitments and contingencies (Note 9)

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

Common stock, $0.001 par value, 900,000,000 shares authorized, 27,631,479 shares issued and
  outstanding as of June 30, 2022 and
27,366,746 shares issued and
  outstanding as of December 31, 2021

 

 

27

 

 

 

27

 

Preferred stock, $0.001 par value, 100,000,000 shares authorized, no shares issued
  and outstanding

 

 

 

 

 

 

Additional paid-in capital

 

 

623,746

 

 

 

617,511

 

Accumulated other comprehensive loss

 

 

(183

)

 

 

(20

)

Accumulated deficit

 

 

(513,604

)

 

 

(479,276

)

Total stockholders' equity

 

 

109,986

 

 

 

138,242

 

Total liabilities and stockholders' equity

 

$

166,714

 

 

$

192,721

 

 

 

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

 

5

 

 

 


 

RxSIGHT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE LOSS (UNAUDITED)

(In thousands, except share and per share amounts)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Sales

 

$

11,360

 

 

$

4,897

 

 

$

20,301

 

 

$

8,381

 

Cost of sales

 

 

6,572

 

 

 

5,709

 

 

 

11,752

 

 

 

8,074

 

Gross profit (loss)

 

 

4,788

 

 

 

(812

)

 

 

8,549

 

 

 

307

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

14,388

 

 

 

6,502

 

 

 

28,008

 

 

 

12,113

 

Research and development

 

 

6,192

 

 

 

6,563

 

 

 

12,911

 

 

 

13,206

 

Total operating expenses

 

 

20,580

 

 

 

13,065

 

 

 

40,919

 

 

 

25,319

 

Loss from operations

 

 

(15,792

)

 

 

(13,877

)

 

 

(32,370

)

 

 

(25,012

)

Other income (expense), net:

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of warrants

 

 

 

 

 

1,214

 

 

 

 

 

 

1,214

 

Expiration of warrant

 

 

 

 

 

 

 

 

 

 

 

5,018

 

Interest expense

 

 

(1,136

)

 

 

(826

)

 

 

(2,196

)

 

 

(1,524

)

Interest and other income

 

 

196

 

 

 

15

 

 

 

242

 

 

 

32

 

Loss before income taxes

 

 

(16,732

)

 

 

(13,474

)

 

 

(34,324

)

 

 

(20,272

)

Income tax expense

 

 

0

 

 

 

3

 

 

 

4

 

 

 

10

 

Net loss

 

$

(16,732

)

 

$

(13,477

)

 

$

(34,328

)

 

$

(20,282

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized (loss) gain on short-term investments

 

 

(76

)

 

 

(4

)

 

 

(150

)

 

 

3

 

Foreign currency translation (loss) gain

 

 

(9

)

 

 

1

 

 

 

(13

)

 

 

(3

)

Total other comprehensive loss

 

 

(85

)

 

 

(3

)

 

 

(163

)

 

 

 

Comprehensive loss

 

$

(16,817

)

 

$

(13,480

)

 

$

(34,491

)

 

$

(20,282

)

Net loss per share:

 

 

 

 

 

 

 

 

 

 

 

 

Attributable to Series G common stock, basic and diluted

 

$

 

 

$

(0.32

)

 

$

 

 

$

(0.48

)

Attributable to common stock, basic

 

$

(0.61

)

 

$

(3.28

)

 

$

(1.25

)

 

$

(5.00

)

Attributable to common stock, diluted

 

$

(0.61

)

 

$

(3.53

)

 

$

(1.25

)

 

$

(5.23

)

Weighted-average shares used in computing net loss per share:

 

 

 

 

 

 

 

 

 

 

 

 

Attributable to Series G common stock, basic and diluted

 

 

 

 

 

1

 

 

 

 

 

 

1

 

Attributable to common stock, basic

 

 

27,559,908

 

 

 

4,106,403

 

 

 

27,493,130

 

 

 

4,052,920

 

Attributable to common stock, diluted

 

 

27,559,908

 

 

 

4,166,439

 

 

 

27,493,130

 

 

 

4,113,249

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

 

 

6

 

 

 


 

RxSIGHT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(UNAUDITED)

(In thousands, except number of shares)

 

 

 

Six Months Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated other

 

 

 

 

 

 

 

 

 

Common stock

 

 

Additional paid-in

 

 

comprehensive

 

 

Accumulated

 

 

Total stockholders'

 

 

 

Shares

 

 

Amount

 

 

capital

 

 

loss

 

 

deficit

 

 

equity

 

Balance at December 31, 2021

 

 

27,366,746

 

 

$

27

 

 

$

617,511

 

 

$

(20

)

 

$

(479,276

)

 

$

138,242

 

Shares issued for the exercise of stock options
 and vesting of restricted stock units

 

 

145,922

 

 

 

 

 

 

308

 

 

 

 

 

 

 

 

 

308

 

Shares redeemed for employee tax withholdings

 

 

(26,983

)

 

 

 

 

 

(362

)

 

 

 

 

 

 

 

 

(362

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,649

 

 

 

 

 

 

 

 

 

2,649

 

Unrealized loss on short-term investments
 and cash equivalents, net of tax

 

 

 

 

 

 

 

 

 

 

 

(74

)

 

 

 

 

 

(74

)

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

(4

)

 

 

 

 

 

(4

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(17,596

)

 

 

(17,596

)

Balance at March 31, 2022

 

 

27,485,685

 

 

$

27

 

 

$

620,106

 

 

$

(98

)

 

$

(496,872

)

 

$

123,163

 

Shares issued for the exercise of stock options
 and vesting of restricted stock units

 

 

99,743

 

 

 

 

 

 

277

 

 

 

 

 

 

 

 

 

277

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,904

 

 

 

 

 

 

 

 

 

2,904

 

Shares issued for the employee stock purchase plan

 

 

46,051

 

 

 

 

 

 

459

 

 

 

 

 

 

 

 

 

459

 

Unrealized loss on short-term investments
 and cash equivalents, net of tax

 

 

 

 

 

 

 

 

 

 

 

(76

)

 

 

 

 

 

(76

)

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

(9

)

 

 

 

 

 

(9

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(16,732

)

 

 

(16,732

)

Balance at June 30, 2022

 

 

27,631,479

 

 

$

27

 

 

$

623,746

 

 

$

(183

)

 

$

(513,604

)

 

$

109,986

 

See accompanying notes to unaudited condensed consolidated financial statements

 

7

 

 

 


 

RxSIGHT, INC.

CONDENSED CONSOLIDATED statements of REDEEMABLE COMMON STOCK, STOCK OPTIONS, CONVERTIBLE PREFERRED STOCK AND stockholders’ equity (DEFICIT) (UNAUDITED)

(In thousands, except number of shares)

 

 

 

Six Months Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Convertible

 

 

 

 

 

 

 

 

 

 

Notes receivable

 

 

Accumulated

 

 

 

 

 

 

 

 

Redeemable common stock

 

Notes receivable for redeemable

 

 

Redeemable

 

 

preferred stock

 

 

Common stock

 

Additional
paid-in

 

 

for common stock

 

 

other comprehensive

 

Accumulated

 

 

Total stockholders'

 

 

 

Shares

 

 

Amount

 

common stock issued

 

 

stock options

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

capital

 

 

issued

 

 

loss

 

deficit

 

 

deficit

 

Balance at December 31, 2020

 

 

3,813,450

 

 

$

80,780

 

$

(803

)

 

$

53,085

 

 

 

14,376,272

 

 

$

353,300

 

 

 

1

 

 

 

 

 

 

 

 

 

 

$

(3

)

$

(430,588

)

 

$

(430,591

)

Exercise of stock options

 

 

280,545

 

 

 

6,922

 

 

 

 

 

(5,715

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation
expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,239

 

 

 

 

 

 

 

 

 

 

 

1,239

 

Unrealized gain on short-term
investments and cash
equivalents, net of tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7

 

 

 

 

 

7

 

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(4

)

 

 

 

 

(4

)

Change in notes receivable for common stock issued

 

 

 

 

 

 

 

(14