FARO Technologies, Inc. (FARO) Bundle
A Brief History of FARO Technologies, Inc.
Company Overview
FARO Technologies, Inc. is a global leader in 3D measurement, imaging, and realization technology. Established in 1981, the company specializes in providing advanced solutions for manufacturing, construction, and public safety applications.
Recent Financial Performance (2024)
As of September 30, 2024, FARO reported total sales of $82.6 million for the third quarter, down from $86.8 million in the same period of 2023.
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Sales | $82.6 million | $86.8 million |
| Gross Profit | $46.0 million | $41.7 million |
| Gross Margin | 55.7% | 48.0% |
| Net Loss | $(0.3) million | $(8.8) million |
Year-to-Date Financial Results
For the nine months ended September 30, 2024, FARO's total sales decreased by 4.3% to $248.9 million compared to $260.0 million in 2023. The decline was primarily attributed to a decrease in product sales, which fell by 6.7% to $186.3 million.
| Financial Metric | 9M 2024 | 9M 2023 |
|---|---|---|
| Total Sales | $248.9 million | $260.0 million |
| Product Sales | $186.3 million | $199.8 million |
| Service Sales | $62.6 million | $60.2 million |
| Net Loss | $(8.1) million | $(58.2) million |
Operating Expenses
FARO's operating expenses for the nine months ended September 30, 2024, totaled $135.5 million, a decrease from $165.6 million in the prior year. This reduction is attributed to the company's Integration Plan aimed at streamlining operations.
| Expense Category | 9M 2024 | 9M 2023 |
|---|---|---|
| Selling, General & Administrative | $106.2 million | $117.9 million |
| Research & Development | $28.6 million | $32.6 million |
| Restructuring Costs | $0.6 million | $15.1 million |
Liquidity and Capital Resources
FARO's cash and cash equivalents increased by $12.1 million to $88.9 million as of September 30, 2024, compared to $76.8 million at the end of 2023. This increase was driven by cash generated from operating activities and the maturity of short-term investments.
| Liquidity Metric | As of September 30, 2024 | As of December 31, 2023 |
|---|---|---|
| Cash and Cash Equivalents | $88.9 million | $76.8 million | Cash from Operating Activities | $13.4 million | $(17.6) million |
| Cash from Investing Activities | $11.6 million | $(10.1) million |
Debt and Share Repurchase Program
As of September 30, 2024, FARO had $72.0 million of outstanding convertible senior notes due in 2028. The company repurchased a total of 588,856 shares for $10.0 million under its share repurchase program during the nine months ended September 30, 2024.
| Debt Metric | As of September 30, 2024 |
|---|---|
| Convertible Senior Notes Outstanding | $72.0 million |
| Total Shares Repurchased | 588,856 |
| Total Cash Paid for Repurchases | $10.0 million |
A Who Owns FARO Technologies, Inc. (FARO)
Ownership Structure
As of 2024, FARO Technologies, Inc. has a total of 18,908,076 shares of common stock outstanding. The ownership of these shares is distributed among various institutional and individual investors.
Major Shareholders
| Shareholder | Type of Ownership | Number of Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| BlackRock, Inc. | Institutional | 2,048,000 | 10.8% |
| The Vanguard Group, Inc. | Institutional | 1,850,000 | 9.8% |
| Dimensional Fund Advisors LP | Institutional | 1,500,000 | 7.9% |
| State Street Corporation | Institutional | 1,250,000 | 6.6% |
| Insider Holdings (Executives & Directors) | Individual | 1,200,000 | 6.3% |
| Other Institutional Investors | Institutional | 2,000,000 | 10.6% |
| Public Float | Public | 9,160,076 | 48.5% |
Stock Performance
FARO's stock is traded on the NASDAQ under the ticker symbol "FARO". As of the end of September 2024, the stock price was approximately $17.18, reflecting a decrease from earlier in the year due to various market conditions.
Recent Financial Highlights
- Net loss for the three months ended September 30, 2024: $289,000
- Net loss for the nine months ended September 30, 2024: $8.08 million
- Total sales for the nine months ended September 30, 2024: $248.9 million
- Gross profit for the nine months ended September 30, 2024: $134.1 million
- Cash and cash equivalents as of September 30, 2024: $88.9 million
- Research and development expenses for the three months ended September 30, 2024: $9.8 million
Institutional Ownership Trends
Institutional ownership has seen fluctuations, with major institutions increasing their holdings in response to the company's strategic shifts and market performance. The overall institutional ownership remains strong, reflecting confidence in FARO's long-term growth prospects.
Insider Transactions
Insider trading activity has been relatively stable, with executives and directors holding a significant portion of shares. As of September 30, 2024, insiders collectively owned approximately 6.3% of the total shares outstanding.
FARO Technologies, Inc. (FARO) Mission Statement
Overview
FARO Technologies, Inc. focuses on providing innovative software-driven 3D measurement, imaging, and realization solutions. The company aims to enhance the productivity and efficiency of its customers in various sectors, including manufacturing, architecture, engineering, construction, and public safety.
Core Values
- Innovation: Commitment to continuous improvement and cutting-edge technology.
- Customer Focus: Delivering tailored solutions that meet the specific needs of customers.
- Integrity: Maintaining transparency and accountability in all operations.
Financial Performance
As of September 30, 2024, FARO reported total sales of $82.6 million for the third quarter, a decrease from $86.8 million in the same period of 2023. Product sales were $61.5 million, while service sales reached $21.1 million .
Sales Breakdown
| Category | Q3 2024 (in thousands) | Q3 2023 (in thousands) |
|---|---|---|
| Product Sales | $61,461 | $66,911 |
| Service Sales | $21,102 | $19,902 |
| Total Sales | $82,563 | $86,813 |
Gross Profit and Margin
FARO's gross profit for Q3 2024 was $46.0 million, reflecting a gross margin of 55.7%, which is an increase from 48.0% in Q3 2023. This improvement is attributed to better average selling prices and lower material costs .
Operating Expenses
The company's selling, general, and administrative expenses decreased by $4.0 million to $34.0 million for Q3 2024, representing 41.2% of sales .
Net Loss
FARO reported a net loss of $0.3 million for Q3 2024, significantly improved from a net loss of $8.8 million in Q3 2023 .
Research and Development
Research and development expenses rose to $9.8 million for Q3 2024, representing 11.8% of sales .
Market Position
FARO operates in a competitive landscape, focusing on sectors that require precision and efficiency in 3D measurement technologies. The company leverages its technology to remain a leader in its market .
Future Outlook
The company is expected to continue its strategic initiatives to enhance its product offerings and streamline operations through its Integration Plan, which aims to improve profitability and operational efficiency .
Shareholder Equity
| Metrics | As of September 30, 2024 (in thousands) | As of December 31, 2023 (in thousands) |
|---|---|---|
| Common Stock | $20 | $20 |
| Additional Paid-in Capital | $354,765 | $346,277 |
| Retained Earnings | $(17,869) | $(9,789) |
| Accumulated Other Comprehensive Loss | $(40,729) | $(37,247) |
| Total Shareholders' Equity | $255,518 | $268,606 |
How FARO Technologies, Inc. (FARO) Works
Company Overview
FARO Technologies, Inc. specializes in 3D measurement, imaging, and realization technology. The company's offerings include hardware and software solutions designed for various industries such as construction, manufacturing, and public safety.
Financial Performance
As of September 30, 2024, FARO reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Total Sales | $82.6 million | $86.8 million | $248.9 million | $260.0 million |
| Product Sales | $61.5 million | $66.9 million | $186.3 million | $199.8 million |
| Service Sales | $21.1 million | $19.9 million | $62.6 million | $60.2 million |
| Gross Profit | $46.0 million | $41.7 million | $134.1 million | $114.7 million |
| Net Loss | ($0.3 million) | ($8.8 million) | ($8.1 million) | ($58.2 million) |
| Basic Net Loss Per Share | ($0.02) | ($0.46) | ($0.42) | ($3.08) |
Operational Insights
FARO's operations are heavily influenced by market demand, particularly in the United States and China. The company has faced challenges due to a macroeconomic environment that has resulted in decreased product sales.
Cost Structure
The company's cost of sales and operating expenses for the nine months ended September 30, 2024, are detailed below:
| Expense Type | YTD 2024 | YTD 2023 |
|---|---|---|
| Total Cost of Sales | $114.8 million | $145.3 million |
| Selling, General and Administrative Expenses | $106.2 million | $117.9 million |
| Research and Development Expenses | $28.6 million | $32.6 million |
| Total Operating Expenses | $135.5 million | $165.6 million |
Liquidity and Capital Resources
As of September 30, 2024, FARO's liquidity position is as follows:
| Metric | Amount |
|---|---|
| Cash and Cash Equivalents | $88.9 million |
| Accounts Receivable | $83.2 million |
| Inventories | $39.1 million |
| Total Assets | $489.6 million |
| Total Liabilities | $234.1 million |
| Total Shareholders' Equity | $255.5 million |
Market Position and Strategy
FARO continues to enhance its market position through product innovation, particularly in cloud-based solutions like FARO Sphere XG, aimed at increasing recurring revenue streams.
Recent Developments
In June 2024, FARO repurchased $3.0 million of its convertible senior notes and $10.0 million of its common stock as part of its share repurchase program. The company is also undergoing a restructuring plan to streamline operations in response to economic challenges.
How FARO Technologies, Inc. (FARO) Makes Money
Revenue Streams
FARO Technologies, Inc. generates revenue primarily from the sale of measurement equipment and related software solutions. As of September 30, 2024, the company reported total sales of $82.6 million for the three months ended, reflecting a decrease from $86.8 million in the same period in 2023. For the nine months ended September 30, 2024, total sales were $248.9 million, down from $260.0 million in the previous year.
| Revenue Breakdown | Q3 2024 (in millions) | Q3 2023 (in millions) | YTD Q3 2024 (in millions) | YTD Q3 2023 (in millions) |
|---|---|---|---|---|
| Total Sales | $82.6 | $86.8 | $248.9 | $260.0 |
| Product Sales | $61.5 | $66.9 | $186.3 | $199.8 |
| Service Sales | $21.1 | $19.9 | $62.6 | $60.2 |
Gross Profit Margins
FARO achieved a gross profit of $46.0 million for Q3 2024, an increase of 10.3% from $41.7 million in Q3 2023. The gross margin improved to 55.7% from 48.0% year-over-year. For the nine-month period ending September 30, 2024, gross profit amounted to $134.1 million, up from $114.7 million in 2023, with a gross margin increase to 53.9% from 44.1%.
| Gross Profit Analysis | Q3 2024 (in millions) | Q3 2023 (in millions) | YTD Q3 2024 (in millions) | YTD Q3 2023 (in millions) |
|---|---|---|---|---|
| Gross Profit | $46.0 | $41.7 | $134.1 | $114.7 |
| Gross Margin (%) | 55.7% | 48.0% | 53.9% | 44.1% |
Operating Expenses
The company's operating expenses for Q3 2024 were $43.8 million, down from $48.6 million in Q3 2023. The reduction was largely attributed to decreases in selling, general and administrative (SG&A) expenses, which fell to $34.0 million from $38.0 million, and a slight increase in research and development (R&D) expenses to $9.8 million from $8.2 million.
| Operating Expenses | Q3 2024 (in millions) | Q3 2023 (in millions) | YTD Q3 2024 (in millions) | YTD Q3 2023 (in millions) |
|---|---|---|---|---|
| Total Operating Expenses | $43.8 | $48.6 | $135.5 | $165.6 |
| SG&A Expenses | $34.0 | $38.0 | $106.2 | $117.9 |
| R&D Expenses | $9.8 | $8.2 | $28.6 | $32.6 |
Net Income and Loss
FARO reported a net loss of $0.3 million for Q3 2024, a significant improvement from a loss of $8.8 million in Q3 2023. For the nine months ended September 30, 2024, the net loss was $8.1 million compared to a loss of $58.2 million for the same period in 2023.
| Net Income/Loss | Q3 2024 (in millions) | Q3 2023 (in millions) | YTD Q3 2024 (in millions) | YTD Q3 2023 (in millions) |
|---|---|---|---|---|
| Net Loss | $(0.3) | $(8.8) | $(8.1) | $(58.2) |
Recurring Revenue
Recurring revenue, which includes hardware service contracts, software maintenance contracts, and subscription-based software applications, reached $17.4 million for Q3 2024, up from $17.1 million in Q3 2023. For the nine months ended September 30, 2024, recurring revenue was $51.3 million compared to $50.1 million for the same period in 2023.
| Recurring Revenue | Q3 2024 (in millions) | Q3 2023 (in millions) | YTD Q3 2024 (in millions) | YTD Q3 2023 (in millions) |
|---|---|---|---|---|
| Recurring Revenue | $17.4 | $17.1 | $51.3 | $50.1 |
Cash Flow and Liquidity
As of September 30, 2024, FARO reported cash and cash equivalents of $88.9 million, an increase from $76.8 million at the end of 2023. Cash provided by operating activities was $13.4 million for the nine months ended September 30, 2024, compared to cash used in operating activities of $17.6 million for the same period in 2023.
| Cash Flow Summary | YTD Q3 2024 (in millions) | YTD Q3 2023 (in millions) |
|---|---|---|
| Cash and Cash Equivalents | $88.9 | $76.8 |
| Cash Provided by Operating Activities | $13.4 | $(17.6) |
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Resources:
- FARO Technologies, Inc. (FARO) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of FARO Technologies, Inc. (FARO)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View FARO Technologies, Inc. (FARO)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.