Kornit Digital Ltd: Kornit Digital Reports First Quarter 2025 Results

• First quarter revenues of $46.5 million, in line with previous guidance
• First quarter GAAP net loss of $5.1 million; non-GAAP net income of $0.6 million
• Continued to generate cash from operations, demonstrating disciplined execution
• Reported annual recurring revenue from AIC contracts of $14.5 million, reflecting strong initial adoption of this new business model

ROSH-HA'AYIN, Israel, May 14, 2025 (GLOBE NEWSWIRE) -- Kornit Digital Ltd. ("Kornit" or the "Company") (Nasdaq: KRNT), a global leader in sustainable, on-demand, digital fashion and textile production technologies, today reported results for the first quarter ended March 31, 2025.

"We delivered to our commitments in Q1, even as we operated in an uncertain macro environment," said Ronen Samuel, Kornit's Chief Executive Officer. "The apparel industry is undergoing significant disruption, and there has never been a better moment for Kornit to lead. Apollo combined with our AIC model is delivering robust impressions growth and unlocking the mass production segment which represents an estimated SAM of 4.5 billion impressions."

Mr. Samuel concluded, "The opportunity ahead is enormous, and Kornit is advancing with clarity, conviction, and purpose. We are playing offense and leading this transformation of how fashion is created, consumed, and delivered."

First Quarter 2025 Results of Operations

• Total revenue for the first quarter of 2025 was $46.5 million compared with $43.8 million in the prior year period.
  
  
• GAAP gross profit margin for the first quarter of 2025 was 42.6% compared with 32.3% in the prior year period. On a non-GAAP basis, gross profit margin was 45.2% compared with 37.5% in the prior year period.
  
  
• GAAP operating expenses for the first quarter of 2025 were $31.9 million compared with $32.4 million in the prior year period. On a non-GAAP basis, operating expenses increased by 1% to $27.4 million compared with the prior year period.
  
  
• GAAP net loss for the first quarter of 2025 was $5.1 million, or ($0.11) per basic share, compared with net loss of $13.2 million, or ($0.28) per basic share, for the first quarter of 2024.
  
  
• Non-GAAP net income for the first quarter of 2025 was $0.6 million, or $0.01 per diluted share, compared with non-GAAP net loss of $5.3 million, or ($0.11) per basic share, for the first quarter of 2024.
  
  
• Adjusted EBITDA loss for the first quarter of 2025 was $3.9 million compared with adjusted EBITDA loss of $7.8 million for the first quarter of 2024. Adjusted EBITDA margin for the first quarter of 2025 was negative 8.4% compared with negative 17.9% for the first quarter of 2024.
  

Second Quarter 2025 Guidance

For the second quarter of 2025, the Company expects revenues to be in the range of $49 million to $55 million and adjusted EBITDA margin between negative 4% and 4%.

First Quarter Earnings Conference Call Information

The Company will host a conference call today at 8:30 a.m. ET, or 3:30 p.m. Israel time, to discuss the results, followed by a question-and-answer session with the investor community.

A live webcast of the call can be accessed at ir.kornit.com. To access the call, participants may dial toll-free at 1-877-407-0792 or 1-201-689-8263. The international number is 1 809 406 247.

To listen to a replay of the conference call, dial toll-free 1-844-512-2921 or 1-412-317-6671 and enter access ID 13753164. The telephonic replay will be available approximately three hours after the completion of the live call until 11:59 pm ET on May 28, 2025. The call will also be available for replay via the webcast link on Kornit's Investor Relations website.

About Kornit Digital

Kornit Digital (NASDAQ: KRNT) is a worldwide market leader in sustainable, on-demand, digital fashion, and textile production technologies. The company offers end-to-end solutions including digital printing systems, inks, consumables, software, and fulfillment services through its global fulfillment network. Headquartered in Israel with offices in the USA, Europe, and Asia Pacific, Kornit Digital serves customers in more than 100 countries and states worldwide. To learn more about how Kornit Digital is boldly transforming the world of fashion and textiles, visit www.kornit.com.

Forward Looking Statements

Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and other U.S. securities laws. Forward-looking statements are characterized by the use of forward-looking terminology such as "will," "expects," "anticipates," "continue," "believes," "should," "intended," "guidance," "preliminary," "future," "planned," or other words. These forward-looking statements include, but are not limited to, statements relating to the Company's objectives, plans and strategies, statements of preliminary or projected results of operations or of financial condition and all statements that address activities, events, or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. The Company has based these forward-looking statements on assumptions and assessments made by its management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Important factors that could cause actual results, developments and business decisions to differ materially from those anticipated in these forward-looking statements include, among other things: the duration and severity of adverse macro-economic headwinds that were caused by inflationary pressures and higher interest rates, which have impacted, and may continue to impact, in an adverse manner, the Company's operations, financial position and cash flows, in part due to the adverse impact on the Company's customers and suppliers; the Company's degree of success in developing, introducing and selling new or improved products and product enhancements including specifically the Company's Poly Pro and Presto products, and the Company's Apollo direct-to-garment platform; the extent of the Company's ability to consummate sales to large accounts with multi-system delivery plans; the degree of the Company's ability to fill orders for its systems and consumables; the extent of the Company's ability to increase sales of its systems, ink and consumables; the extent of the Company's ability to leverage its global infrastructure build-out; the development of the market for digital textile printing; the availability of alternative ink; competition; sales concentration; changes to the Company's relationships with suppliers; the extent of the Company's success in marketing; and those additional factors referred to under "Risk Factors" in Item 3.D of the Company's Annual Report on Form 20-F for the year ended December 31, 2024, filed with the SEC on March 28, 2025. Any forward-looking statements in this press release are made as of the date hereof, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Discussion Disclosure

The Company presents certain non-GAAP financial measures, in this press release and in the accompanying conference call to discuss the Company's quarterly results. These non-GAAP financial measures reflect adjustments to corresponding GAAP financial measures in order to exclude the impact of the following: share-based compensation expenses; amortization of intangible assets; restructuring expenses; foreign exchange differences associated with ASC 842; and non-cash deferred tax income.

The Company defines "Adjusted EBITDA" as non-GAAP operating income (loss), which reflects the adjustments described in the preceding paragraph, as further adjusted to exclude depreciation expense.

The purpose of the foregoing non-GAAP financial measures is to convey the Company's performance exclusive of non-cash charges and other items that are considered by management to be outside of the Company's core operating results. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Furthermore, the non-GAAP measures are regularly used internally to understand, manage, and evaluate the Company's business and make operating decisions, and the Company believes that they are useful to investors as a consistent and comparable measure of the ongoing performance of the Company's business. The Company's non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies.

The reconciliation tables included below present a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP financial measures.

Investor Contact:
Jared Maymon
Global Head of Investor Relations & Strategic Finance
[e-mail]

KORNIT DIGITAL LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
		March 31,		December 31,
		2025		2024
		(Unaudited)		(Audited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$ 56,029		$ 35,003
Short-term bank deposit		226,934		205,934
Marketable securities		169,107		222,937
Trade receivables, net		61,411		65,459
Inventory		57,617		60,342
Other accounts receivable and prepaid expenses		27,079		25,714
Total current assets		598,177		615,389
LONG-TERM ASSETS:
Marketable securities		61,078		48,086
Deposits and other long-term assets		10,855		10,542
Severance pay fund		305		306
Property,plant and equipment, net		63,122		59,222
Operating lease right-of-use assets		18,738		19,054
Intangible assets, net		5,339		5,721
Goodwill		29,164		29,164
Total long-term assets		188,601		172,095
Total assets		786,778		787,484
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables		5,897		9,019
Employees and payroll accruals		14,216		13,101
Deferred revenues and advances from customers		1,793		2,339
Operating lease liabilities		3,249		3,311
Other payables and accrued expenses		24,975		16,561
Total current liabilities		50,130		44,331
LONG-TERM LIABILITIES:
Accrued severance pay		1,021		1,051
Operating lease liabilities		14,651		15,065
Other long-term liabilities		154		138
Total long-term liabilities		15,826		16,254
SHAREHOLDERS' EQUITY		720,822		726,899
Total liabilities and shareholders' equity		$ 786,778		$ 787,484

KORNIT DIGITAL LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)
	Three Months Ended
	March 31,
		2025				2024
	(Unaudited)
Revenues
Products	$	33,865			$	29,013
Services		12,592				14,763
Total revenues		46,457				43,776
Cost of revenues
Products		15,613				15,691
Services		11,044				13,946
Total cost of revenues		26,657				29,637
Gross profit		19,800				14,139
Operating expenses:
Research and development, net		9,278				11,352
Sales and marketing		14,949				13,796
General and administrative		7,644				7,277
Total operating expenses		31,871				32,425
Operating loss		(12,071	)			(18,286	)
Financial income, net		7,383				5,346
Loss before taxes on income		(4,688	)			(12,940	)
Taxes on income		371				259
Net loss	$	(5,059	)		$	(13,199	)
Basic loss per share	$	(0.11	)		$	(0.28	)
Weighted average number of shares
used in computing basic net loss per share		45,801,003				47,611,456
Diluted loss per share	$	(0.11	)		$	(0.28	)
Weighted average number of shares
used in computing diluted net loss per share		45,801,003				47,611,456

	KORNIT DIGITAL LTD.
	AND ITS SUBSIDIARIES
	RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
	(U.S. dollars in thousands, except share and per share data)
			Three Months Ended
			March 31,
				2025				2024
			(Unaudited)
	Revenues		$	46,457			$	43,776
	GAAP cost of revenues		$	26,657			$	29,637
	Cost of product recorded for share-based compensation (1)			(519	)			(502	)
	Cost of service recorded for share-based compensation (1)			(395	)			(419	)
	Intangible assets amortization on cost of product (2)			(148	)			(265	)
	Intangible assets amortization on cost of service (2)			(160	)			(160	)
	Restructuring expenses (3)			-				(914	)
	Non-GAAP cost of revenues		$	25,435			$	27,377
	GAAP gross profit		$	19,800			$	14,139
	Gross profit adjustments			1,222				2,260
	Non-GAAP gross profit		$	21,022			$	16,399
	GAAP operating expenses		$	31,871			$	32,425
	Share-based compensation (1)			(4,406	)			(4,527	)
	Intangible assets amortization (2)			(74	)			(88	)
	Restructuring expenses (3)			-				(757	)
	Non-GAAP operating expenses		$	27,391			$	27,053
	GAAP Financial income, net		$	7,383			$	5,346
	Foreign exchange losses associated with ASC 842			(43	)			385
	Non-GAAP Financial income, net		$	7,340			$	5,731
	GAAP Taxes on income		$	371			$	259
	Non-cash deferred tax income			-				87
	Non-GAAP Taxes on income		$	371			$	346
	GAAP Net loss		$	(5,059	)		$	(13,199	)
	Share-based compensation (1)			5,320				5,448
	Intangible assets amortization (2)			382				513
	Restructuring expenses (3)			-				1,671
	Foreign exchange losses associated with ASC 842			(43	)			385
	Non-cash deferred tax income			-				(87	)
	Non-GAAP net income (loss)		$	600			$	(5,269	)
	GAAP diluted loss per share		$	(0.11	)		$	(0.28	)
	Non-GAAP diluted income (loss) per share		$	0.01			$	(0.11	)
	Weighted average number of shares
	Shares used in computing GAAP diluted net loss per share			45,801,003				47,611,456
	Shares used in computing Non-GAAP diluted net income (loss) per share			46,355,596				47,611,456
	(1) Share-based compensation
		Cost of product revenues	$	519			$	502
		Cost of service revenues		395				419
		Research and development		1,202				1,295
		Sales and marketing		1,537				1,582
		General and administrative		1,667				1,650
			$	5,320			$	5,448
	(2) Intangible assets amortization
		Cost of product revenues	$	148			$	265
		Cost of service revenues		160				160
		Sales and marketing		74				88
			$	382			$	513
	(3) Restructuring expenses
		Cost of product revenues	$	-			$	865
		Cost of service revenues		-				49
		Research and development		-				235
		Sales and marketing		-				190
		General and administrative		-				332
			$	-			$	1,671

	KORNIT DIGITAL LTD.
	AND ITS SUBSIDIARIES
	CONSOLIDATED STATEMENTS OF CASH FLOWS
	(U.S. dollars in thousands)
		Three Months Ended
		March 31,
			2025				2024
		(Unaudited)
	Cash flows from operating activities:
	Net loss	$	(5,059	)		$	(13,199	)
	Adjustments to reconcile net loss to net cash provided by operating activities:
	Depreciation and amortization		2,846				3,324
	Fair value of warrants deducted from revenues		-				3,586
	Share-based compensation		5,320				5,448
	Amortization of premium and accretion of discount on marketable securities, net		(304	)			(7	)
	Realized loss on sale and redemption of marketable securities		(22	)			-
	Change in operating assets and liabilities:
	Trade receivables, net		4,048				12,905
	Other accounts receivables and prepaid expenses		(1,365	)			514
	Inventory		2,320				(96	)
	Operating leases right-of-use assets and liabilities, net		(160	)			(87	)
	Deposits and other long term assets		(313	)			(708	)
	Trade payables		(5,310	)			(3,765	)
	Employees and payroll accruals		2,092				(1,152	)
	Deferred revenues and advances from customers		(546	)			(308	)
	Other payables and accrued expenses		2,230				(2,313	)
	Accrued severance pay, net		(29	)			(32	)
	Other long - term liabilities		16				(86	)
	Net cash provided by operating activities		5,764				4,024
	Cash flows from investing activities:
	Purchase of property, plant and equipment		(3,771	)			(1,284	)
	Proceeds from investment in short-term bank deposits, net		(21,000	)			(24,397	)
	Proceeds from sales and redemption of marketable securities		2,800				3,494
	Proceeds from maturities of marketable securities		65,320				11,298
	Investment in marketable securities		(25,815	)			(18,017	)
	Net cash provided by (used in) investing activities		17,534				(28,906	)
	Cash flows from financing activities:
	Exercise of employee stock options		529				-
	Payments related to shares withheld for taxes		(977	)			(594	)
	Repurchase of ordinary shares		(1,824	)			(7,628	)
	Net cash used in financing activities		(2,272	)			(8,222	)
	Increase (decrease) in cash and cash equivalents		21,026				(33,104	)
	Cash and cash equivalents at the beginning of the period		35,003				39,605
	Cash and cash equivalents at the end of the period	$	56,029			$	6,501
	Non-cash investing and financing activities:
	Purchase of property and equipment on credit		2,435				92
	Inventory transferred to be used as property and equipment and Equipment on lease		405				946
	Property, plant and equipment transferred to be used as inventory		-				154
	Lease liabilities arising from obtaining right-of-use assets		522				(1,746	)

	KORNIT DIGITAL LTD.
	AND ITS SUBSIDIARIES
	RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA
	(U.S. dollars in thousands, except share and per share data)
			Three Months Ended
			March 31,
				2025				2024
			(Unaudited)
	GAAP Revenues		$	46,457			$	43,776
	GAAP Net loss			(5,059	)			(13,199	)
	Taxes on income			371				259
	Financial income			(7,383	)			(5,346	)
	Share-based compensation			5,320				5,448
	Intangible assets amortization			382				513
	Restructuring expenses			-				1,671
	Non-GAAP Operating loss			(6,369	)			(10,654	)
	Depreciation			2,464				2,811
	Adjusted EBITDA		$	(3,905	)		$	(7,843	)