Faro Reports First Quarter 2023 Financial Result & Announces CEO Retirement
Faro Technologies has report its first quarter financial results which are summarized below:
- Total sales of $85.0 million, up 11% compared to the prior year period
- Software sales of $10.3 million or 12% of revenue, approximately flat with the prior year period due to the conversion of license revenue to subscription
- Recurring revenue of $16.7 million or 20% of revenue, down from 22% in the prior year period due to the strength in hardware sales
- Gross margin of 46.7%, compared to 53.5% in the prior year period with the reduction primarily as a result of material cost increases
- Operating expenses of $58.3 million, compared to $48.2 million in the prior year period which includes approximately $2.7 million in one-time expenses associated with a first quarter global sales conference
- Net loss of $21.2 million compared to net loss of $9.7 million in the prior year period
Sales Revenues By Region
“First quarter revenue remained strong at $85.0 million, growing 11% year-on-year, driven primarily by shipments of our new Focus Premium Laser Scanner,” said Michael Burger, President and Chief Executive Officer. “After experiencing delays in customer purchase decisions late in the first quarter due to a softening macroeconomic environment, we are implementing additional annualized cost saving initiatives in the range of $10 million to $20 million, to offset both the expected revenue impact and continued near-term inflationary pressures. Looking ahead, we continue to believe the combination of investments in our latest product innovations and the integration of recent acquisitions positions us well to capture the significant market opportunity inherent in digitalizing the physical world.”
Faro Starts Search For New CEO
Faro Technologies also announced that Michael Burger has informed the company that he intends to retire as president & chief executive officer and such retirement will be effective July 1st, 2023. The board of directors has appointed Yuval Wasserman, its current chairman of the board as Executive Chairman effective May 4th, 2023 and as Chairman and Interim CEO, effective July 1st, 2023. Mr. Burger will remain as a strategic advisor to the Company and to Mr. Wasserman, to assist in the transition.
“On behalf of the board, the company, and its stakeholders, I would like to thank Michael for his many contributions during his tenure as President and CEO of FARO,” stated Yuval Wasserman, chairman of the board. “Under Michael’s leadership, FARO has embarked on a new strategy to grow its product offerings, served markets and target applications through the expansion into a SaaS model while transferring our manufacturing to an outsourced model. This new strategy, while still in its early stages, positions FARO for growth, diversification, and value creation. I’d like to extend our best wishes to Michael on his retirement. As we continue to pursue our strategy and optimize our business, we will accelerate the process of hiring a new CEO for FARO.”
Mr. Burger noted, “Throughout my four years as president and chief executive officer of FARO, we have focused on building a clear strategy to drive the long-term growth of the Company. I am proud of the progress our employees have made and I have very high confidence in the team of highly experienced leaders we have built. I look forward to working with our board and Yuval to ensure a smooth transition.”
Yuval Wasserman was previously President CEO of Advanced Energy Industries, Inc. from 2014 to 2021. During his tenure at Advanced Energy Industries, it grew into a global leader in precision power conversion with over $1.4 billion in annual sales, delivering significant shareholder return. The Board believes that Yuval has the right experience and depth of understanding of the company to lead FARO through this transition and successfully recruit a permanent CEO.
For more information: www.faro.com
