Evolv Technology Reports Strong Second Quarter Financial Results

Company Issues Full Year Revenue Outlook of 375% Growth in 2021

  • Q2 Revenue of $4.5 million, up 590% year-over-year
  • Q2 Total Contract Value (TCV) of $10.9 million, up 361% year-over-year
  • Begins Trading on NASDAQ following combination with NewHold Investment Corp.

WALTHAM, Mass.–(BUSINESS WIRE)–Evolv Technology (NASDAQ: EVLV), the global leader in weapons detection security screening, today announced financial results for its second quarter ended June 30, 2021.

“We’re delighted to be reporting strong second quarter results which reflect the growing demand for our innovative approach to keeping venues safe,” said Peter George, Chief Executive Officer of Evolv Technology. “Our growth continues to be fueled by visionary security experts that are deploying Evolv Express in venues to improve their security posture and their visitors’ experience, while lowering their operating costs. Looking ahead, we believe that we are well positioned to extend our leadership in the weapons detection security screening market.”

Results for the Second Quarter of 2021

Total revenue for the second quarter of 2021 was $4.5 million, an increase of 590% compared to $0.6 million for the second quarter of 2020. Total Contract Value (“TCV”) of orders booked for the second quarter of 2021 was $10.9 million, an increase of 361% compared to $2.6 million in the second quarter of 2020. GAAP net loss for the second quarter of 2021 was $22.4 million, or $0.71 per basic and diluted share, compared to a GAAP net loss of $5.1 million, or $0.22 per basic and diluted share, for the second quarter of 2020. As of June 30, 2021, the Company had $10.0 million of cash and cash equivalents compared to $4.7 million at December 31, 2020. On July 16, 2021, the Company completed its previously announced business combination with NewHold Investment Corp., which raised approximately $385 million of cash for the Company which the Company intends to use for general working capital requirements and to fund the Company’s accelerating growth.

Results for the First Six Months of 2021

Total revenue for the first six months of 2021 was $8.5 million, an increase of 558% compared to $1.3 million for the first six months of 2020. TCV of orders booked for the first six months of 2021 was $20.2 million, an increase of 226% compared to $6.0 million in the first six months of 2020. GAAP net loss for the first six months of 2021 was $36.1 million, or $1.22 per basic and diluted share, compared to a GAAP net loss of $11.5 million, or $0.49 per basic and diluted share, for the first six months of 2020.

Company Issues Outlook for 2021

The Company today issued its full year outlook for TCV of orders booked and total revenue. The Company’s outlook is based on the current indications for its business, which may change at any time.

  • The Company expects the TCV of orders booked in 2021 to be in the range of $53 million to $55 million.
  • The Company expects total revenue in 2021 to be in the range of $20 million to $21 million.
  • The Company expects GAAP net loss per share to be in the range of $0.75 to $0.80 based on approximately 84 million weighted average diluted shares outstanding.

Company to Host Live Conference Call and Webcast

The Company’s management team plans to host a live conference call and webcast at 4:30 p.m. Eastern Time today to discuss the financial results as well as management’s outlook for the business and other matters. The conference call may be accessed in the United States by dialing +1.844.867.6169 and using access code “EVLV”. The conference call may be accessed outside of the United States by dialing +1.409.207.6975 and using access code “EVLV”. The conference call will be simultaneously webcast on the Company’s investor relations website, which can be accessed at http://ir.evolvtechnology.com. A replay of the conference call will be available approximately two hours after the call for a period of two weeks by dialing 1.866.207.1041 or +1.402.970.0847 and using access code 5737477 or by accessing the webcast replay on the Company’s investor relations website at http://ir.evolvtechnology.com. The Company has used, and intends to continue to use, the investor relations portion of its website as a means of disclosing material non-public information and for complying with disclosure obligations under Regulation FD.

About Evolv Technology

Evolv Technology (NASDAQ: EVLV) is the global leader in weapons detection security screening. Our mission is enabling a better experience and better security for venues, creating a safer world to work, learn, and play by transforming physical security to make everywhere safer. This enhances the visitor experience and improves weapons detection. We give sports fans, theme park visitors, concertgoers, shoppers, employees, students, and others peace of mind so that they can gather without fear of violence. Our security system, delivered as a SaaS-based offering, has scanned more than 75 million people, second only to the Department of Homeland Security’s Transportation Security Administration in the United States, and our technology combines powerful, advanced sensors with proven artificial intelligence (AI), security ecosystem integrations, and comprehensive venue analytics to reliably detect threats 10 times faster than traditional metal detectors. Evolv Technology, Evolv Express®, Evolv Insights™, and Evolv Cortex AI™ are registered trademarks or trademarks of Evolv Technologies, Inc. in the United States and other jurisdictions. For more information, visit https://evolvtechnology.com.

Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking” statements and information, within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 that relate to our current expectations and views of future events. All statements other than statements of historical facts contained in this press release are forward-looking statements. In some cases, these forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “should,” “could,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or the negative of these terms or other similar expressions. These forward-looking statements are subject to risks, uncertainties and assumptions, some of which are beyond our control. In addition, these forward-looking statements reflect our current views with respect to future events or our Company’s performance and are not a guarantee of future performance. Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors, including, without limitation expectations regarding Evolv’s strategies and future financial performance, including its future business plans or objectives, prospective performance and opportunities and competitors, revenues, products and services, pricing, operating expenses, market trends, liquidity, cash flows and uses of cash, capital expenditures, and Evolv’s ability to invest in growth initiatives and pursue acquisition opportunities; the risk that the consummation of the business combination with NewHold Investment Corp. (the “Business Combination”) disrupts Evolv’s current plans; the ability to recognize the anticipated benefits of the Business Combination; unexpected costs related to the Business Combination; limited liquidity and trading of our securities; geopolitical risk and changes in applicable laws or regulations; the possibility that we may be adversely affected by other economic, business, and/or competitive factors; operational risk; risk that the COVID-19 pandemic, and local, state, and federal responses to addressing the pandemic may have an adverse effect on our business operations, as well as our financial condition and results of operations; litigation and regulatory enforcement risks, including the diversion of management time and attention and the additional costs and demands on our resources; our ability to successfully deploy the proceeds from the Business Combination; and the risk factors set forth under the caption “Risk Factors” in our proxy statement/prospectus, filed with the Securities and Exchange Commission (the “SEC”) on June 28, 2021, as updated by the risk factors disclosed in the section titled “Risk Factors” in our Form 8-K, filed with the SEC on July 22, 2021, and in our other documents filed with or furnished to the SEC.

These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this press release. You should not put undue reliance on any forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

EVOLV TECHNOLOGY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except share and per share data)

(Unaudited)

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2021

 

2020

 

2021

 

2020

Revenue:

 

 

 

 

 

 

 

 

Product revenue………………………………………………………………..

 

$ 2,452

 

$ 17

 

$ 4,954

 

$ 73

Subscription revenue…………………………………………………………

 

1,513

 

490

 

2,813

 

949

Service revenue ………………………………………………………………..

 

515

 

142

 

712

 

267

Total revenue…………………………………………………………..

 

4,480

 

649

 

8,479

 

1,289

Cost of revenue:

 

 

 

 

 

 

 

 

Product revenue………………………………………………………………..

 

2,075

 

37

 

4,304

 

198

Subscription revenue…………………………………………………………

 

861

 

364

 

1,456

 

702

Service revenue ………………………………………………………………..

 

413

 

85

 

540

 

207

Total cost of revenue………………………………………………..

 

3,349

 

486

 

6,300

 

1,107

Gross profit……………………………………………………………..

 

1,131

 

163

 

2,179

 

182

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Sales and marketing………………………………………………………….

 

1,077

 

2,947

 

4,689

 

6,541

Research and development…………………………………………………

 

5,090

 

1,371

 

8,774

 

3,553

General and administrative………………………………………………..

 

1,280

 

869

 

4,179

 

1,499

Total operating expenses…………………………………………………

 

7,447

 

5,187

 

17,642

 

11,593

Loss from operations………………………………………………………

 

(6,316)

 

(5,024)

 

(15,463)

 

(11,411)

 

 

 

 

 

 

 

 

 

Interest expense………………………………………………………………..

 

3,255

 

80

 

5,702

 

123

Loss on extinguishment of debt………………………………………….

 

11,820

 

 

11,820

 

Change in fair value of derivative liability…………………………..

 

795

 

 

2,220

 

Change in fair value of common stock warrant liability…………

 

185

 

 

921

 

Total other expense…………………………………………………..

 

16,055

 

80

 

20,663

 

123

Net loss and comprehensive loss attributable to common

 

stockholders – basic and diluted…………………………………………..

 

$ (22,371)

 

$ (5,104)

 

$ (36,126)

 

$ (11,534)

 

 

 

 

 

 

 

 

 

Net loss per share – basic and diluted………………………………….

 

$ (0.71)

 

$ (0.22)

 

$ (1.22)

 

$ (0.49)

Weighted average ordinary shares outstanding – basic and

 

diluted…………………………………………………………………………

 

31,540,397

 

23,568,291

 

29,593,131

 

23,491,518

 

 

 

 

 

 

 

 

 

EVOLV TECHNOLOGY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

(Unaudited)

     
 

June 30,
2021

 

December 31,
2020

Assets

 

 

 

 

Current assets:

 

 

 

 

Cash …………………………………………………………………………………………………………………………………..

 

9,963

 

4,704

Restricted Cash ……………………………………………………………………………………………………………………

 

400

 

Accounts receivable, net………………………………………………………………………………………………………..

 

2,799

 

1,401

Inventory…………………………………………………………………………………………………………………………….

 

3,869

 

2,742

Prepaid expenses and other current assets………………………………………………………………………………..

 

9,237

 

1,462

Total current assets………………………………………………………………………………………………………

 

26,268

 

10,309

Commission asset, noncurrent……………………………………………………………………………

 

2,192

 

1,730

Property and equipment, net………………………………………………………………………………

 

17,552

 

9,316

Restricted cash, noncurrent………………………………………………………………………………

 

275

 

Other long-term assets……………………………………………………………………………………

 

239

 

Total assets………………………………………………………………………………………………………………….

 

$ 46,526

 

$ 21,355

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable…………………………………………………………………………………………………………………

 

9,798

 

4,437

Accrued expenses and other current liabilities………………………………………………………………………….

 

5,493

 

3,727

Current portion of deferred revenue………………………………………………………………………………………..

 

3,769

 

3,717

Current portion of long-term debt…………………………………………………………………………………………..

 

29,802

 

Other current liabilities………………………………………………………………………………………………………….

 

163

 

238

Total current liabilities………………………………………………………………………………………………….

 

49,025

 

12,119

Deferred revenue…………………………………………………………………………………………………………………………..

 

681

 

480

Common stock warrant liability………………………………………………………………………….

 

922

 

1

Derivative liability……………………………………………………………………………………….

 

20,206

 

1,000

Financing obligation, noncurrent…………………………………………………………………………

 

 

132

Long-term debt, noncurrent………………………………………………………………………………

 

18,352

 

16,432

Total liabilities…………………………………………………………………………………………………………….

 

89,186

 

30,164

 

 

 

 

 

Convertible preferred stock and shareholders’ equity

 

 

 

 

Convertible preferred stock…………………………………………………………………………….

 

75,877

 

75,877

Common stock………………………………………………………………………………………….

 

35

 

26

Additional paid-in capital………………………………………………………………………………

 

11,439

 

9,169

Accumulated deficit ……………………………………………………………………………………

 

(130,007)

 

(93,881)

Total shareholders’ deficit………………………………………………………………………………

 

(118,537)

 

(84,686)

Total liabilities and shareholders’ equity……………………………………………………………….

 

46,526

 

21,355

 

 

 

 

 

EVOLV TECHNOLOGY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

 

 

 

Six Months Ended

June 30,

 

 

2021

 

2020

Cash flows from operating activities:

 

 

 

 

Net loss……………………………………………………………………………………………………………………………………………..

 

$ (36,126)

 

$ (11,534)

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization………………………………………………………………………………

 

1,102

 

394

Stock-based compensation…………………………………………………………………………………

 

1,617

 

122

Noncash interest expense……………………………………………………………………………………

 

5,455

 

Provision recorded for allowance for doubtful accounts……………………………………………………

 

(63)

 

(16)

Loss on extinguishment of debt……………………………………………………………………………..

 

11,820

 

Change in fair value of derivative liability…………………………………………………………………

 

2,220

 

Change in fair value of common stock warrant liability……………………………………………………

 

921

 

Changes in operating assets and liabilities………………………………………………………………….

 

(3,900)

 

(2,075)

Net cash provided by operating activities……………………………………………………………………..

 

(16,954)

 

(13,109)

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Purchases of property and equipment……………………………………………………………………………………………

 

(9,292)

 

(2,106)

Net cash used in investing activities…………………………………………………………………………….

 

(9,292)

 

(2,106)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Proceeds from issuance of Series B-1 convertible preferred stock, net of issuance costs…………….

 

 

2,994

Proceeds from exercise of stock options………………………………………………………………

 

657

 

70

Repayment of financing obligations…………………………………………………………………..

 

(359)

 

(161)

Proceeds from long-term debt, net of issuance costs………………………………………………….

 

31,882

 

3,154

Net cash provided by financing activities……………………………………………………………………..

 

32,180

 

6,057

 

 

 

 

 

Net increase (decrease) in cash…………………………………………………………………………………………………………..

 

5,934

 

(9,158)

 

 

 

 

 

Cash, beginning of period…………………………………………………………………………………………………………………….

 

4,704

 

17,341

Cash, end of period……………………………………………………………………………………………………………………………..

 

$10,638

 

$8,183

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

Cash paid for interest………………………………………………………………………………………………………………….

 

$247

 

$80

 

Contacts

Investor Contact:
Brian Norris

Vice President of Investor Relations

bnorris@evolvtechnology.com

Media Contact:
Fitz Barth

Director of Communications

fbarth@evolvtechnology.com