hlit-20240628

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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 28, 2024


☐			Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File No. 000-25826

_____________________________________________________

HARMONIC INC.

(Exact name of registrant as specified in its charter)

_____________________________________________________


Delaware			77-0201147
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)

2590 Orchard Parkway

San Jose, CA 95131

(408) 542-2500

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

____________________________________________

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, $0.001 par value

HLIT

NASDAQ Global Select Market

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	☐

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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 ☒

The number of shares of the registrant’s Common Stock, $0.001 par value, outstanding on July 29, 2024 was 116,326,955.

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TABLE OF CONTENTS


PART I

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)			3
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			20
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			28
ITEM 4. CONTROLS AND PROCEDURES			29

PART II

ITEM 1. LEGAL PROCEEDINGS			30
ITEM 1A. RISK FACTORS			31
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS			52


ITEM 5. OTHER INFORMATION			53
ITEM 6. EXHIBITS			54

SIGNATURES			55

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PART I

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

HARMONIC INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except par value)


	June 28, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	45,850	$	84,269
Restricted cash	2,827		—
Accounts receivable, net	119,999		141,531
Inventories	84,133		83,982
Prepaid expenses and other current assets	31,742		20,950
Total current assets	284,551		330,732
Property and equipment, net	29,603		36,683
Operating lease right-of-use assets	15,244		20,817
Goodwill	237,884		239,150
Deferred income taxes	112,906		104,707
Other non-current assets	33,508		36,117
Total assets	$	713,696	$	768,206
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Convertible debt	$	—	$	114,880
Current portion of long-term debt	944		—
Current portion of other borrowings	8,348		4,918
Accounts payable	30,017		38,562
Deferred revenue	53,142		46,217
Operating lease liabilities	6,166		6,793
Other current liabilities	53,284		61,024
Total current liabilities	151,901		272,394
Long-term debt	113,805		—
Other long-term borrowings	5,245		10,495
Operating lease liabilities, non-current	16,594		18,965
Other non-current liabilities	33,343		29,478
Total liabilities	320,888		331,332
Commitments and contingencies (Note 12)
Stockholders’ equity:
Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued or outstanding	—		—
Common stock, $0.001 par value, 150,000 shares authorized; 115,998 and 112,407 shares issued and outstanding at June 28, 2024 and December 31, 2023, respectively	116		112
Additional paid-in capital	2,416,152		2,405,043
Accumulated deficit	(2,013,333)		(1,962,575)
Accumulated other comprehensive loss	(10,127)		(5,706)
Total stockholders’ equity	392,808		436,874
Total liabilities and stockholders’ equity	$	713,696	$	768,206

The accompanying notes are an integral part of these condensed consolidated financial statements.

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HARMONIC INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except per share data)


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Revenue:
Appliance and integration	$	94,184	$	111,127	$	175,779	$	225,921
SaaS and service	44,556		44,836		85,021		87,691
Total net revenue	138,740		155,963		260,800		313,612
Cost of revenue:
Appliance and integration	50,878		57,437		93,952		117,185
SaaS and service	14,405		13,586		30,310		27,433
Total cost of revenue	65,283		71,023		124,262		144,618
Total gross profit	73,457		84,940		136,538		168,994
Operating expenses:
Research and development	28,784		32,205		59,489		65,714
Selling, general and administrative	39,821		42,773		78,686		82,055
Lease-related asset impairment and other charges	9,000		—		9,000		—
Restructuring and related charges	11,482		—		14,519		83
Total operating expenses	89,087		74,978		161,694		147,852
Income (loss) from operations	(15,630)		9,962		(25,156)		21,142
Interest expense, net	(1,424)		(800)		(2,147)		(1,506)

Other income (expense), net	619		(136)		330		(429)
Income (loss) before income taxes	(16,435)		9,026		(26,973)		19,207

SEC Form 10-Q filed by Harmonic Inc.