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Casa Systems Announces CEO Transition and Reports Fourth Quarter and Full Year 2022 Financial Results

Jerry Guo to Retire as President and CEO, Remains on Casa Board of Directors
Bruce Evans Appointed New Chairman of Expanded Board of Directors
Scott Bruckner Joins the Board of Directors

Q4 Revenue of $84.4 Million Slightly Exceeds High End of Preliminary Guidance
GAAP Net Income of $1.2 Million and Positive Net Adjusted EBITDA of $5.2 Million for Quarter
Debt Reduced by $49.2 Million to $226.0 Million during Q4
Provides Full Year Revenue and Net Adjusted EBITDA Guidance

/EIN News/ -- ANDOVER, Mass., March 14, 2023 (GLOBE NEWSWIRE) -- Casa Systems, Inc. (Nasdaq: CASA), a leading provider of cloud-native software and physical broadband technology solutions for wireless, cable, and fixed networks, today announced that the Company’s President and Chief Executive Officer will be retiring, and reported its financial results for the fourth quarter and year ended December 31, 2022.

The Company announced that Jerry Guo will be retiring as CEO and President effective March 17, 2023. He will remain as an active member of the Casa Systems’ Board of Directors. Mr. Guo founded the Company in 2003 and has been instrumental in directing the Company’s technology vision, global operations, and growth. The Board has retained an executive search firm to identify Mr. Guo’s successor. Edward Durkin, the Company’s CFO, will serve as Interim CEO until the Company’s new CEO is hired, with advisory assistance to be received from Jerry, and with functional support across all other disciplines from the Casa senior management team.

“On behalf of the Board, the management team, and employees, I would like to thank Jerry for his leadership and dedicated years of service to Casa Systems since founding the Company 20 years ago in 2003,” said Bruce Evans, Chairman of the Board. “Jerry has worked tirelessly to build Casa Systems into a leading global provider of cloud-native and broadband technology solutions while constructing the solid foundation that will support Casa Systems multi-year transformation. As Jerry departs from his daily operational and executive duties, we look forward to Jerry's continued leadership as an active member of our Board, and wish him much happiness in his retirement. We are also pleased to announce the appointment of Scott Bruckner to the newly expanded Board of Directors. Scott previously served as Casa Systems Chief Financial Officer, has a deep understanding of the Company’s business, strategy, major customers and ecosystem partners, and also brings a wealth of domain experience and expertise to the expanded Casa Board.

Mr. Evans continued, “As we move forward, we will be focused on delivering consistent, annual top line revenue growth, with improved gross and net margins. We believe 2023 will be an important first year of this new era for Casa Systems as we continue to deliver our innovative solutions to market, focus deeply on the needs of our global customers, prioritize a return to growth and profitability, and address our Term Loan B debt facility before its contractual maturity in late December 2023.”

“It is with a heavy heart that I will be saying goodbye to daily interactions with my colleagues at Casa Systems, my comrades-in-arms, in good times and tough times. It has been a privilege to have worked with my co-founders and co-workers over the last 20 years. I want to thank my tremendously talented colleagues for their dedication, ingenuity, and perseverance. I have strong confidence that the market-leading Casa technologies and solutions related to cloud-native software and innovative hardware which we have built will help transform the telecom industry like we have envisioned. I am excited about the future of Casa Systems, and look forward to assisting the Company in this important next chapter of Casa’s transformation,” said Mr. Guo.

With respect to fourth quarter and 2022 financial results, the Company announced the following:

Fourth Quarter 2022 Financial & Operational Highlights

  • Revenue of $84.4 million
  • GAAP net income of $1.2 million
  • Non-GAAP net income of $5.3 million
  • GAAP net income per fully diluted share of $0.01
  • Non-GAAP net income per fully diluted share of $0.05
  • Net Adjusted EBITDA of $5.2 million
  • Cash, cash equivalents and restricted cash of $129.4 million at quarter end

Fiscal Year 2022 Financial & Operational Highlights

  • Revenue of $286.5 million
  • GAAP net loss of $(79.2) million
  • Operating cash burn for the year of $(8.6) million
  • Non-GAAP net loss of $(65.1) million
  • GAAP net loss per fully diluted share of $(0.86)
  • Non-GAAP net loss per fully diluted share of $(0.71)
  • Adjusted EBITDA of $(41.8) million
  • 2022 results include charge to cost of revenue of $12.8 million for a customer warranty settlement as previously disclosed in Q3 2022
  • Net Adjusted EBITDA of $(29.0) million

Mr. Durkin commented, “Casa ended 2022 with strong Q4 revenue results and a return to GAAP net income and positive Net Adjusted EBITDA results. I am pleased that Casa exceeded the high end of our preliminary revenue guidance provided in late January 2023, which results were primarily driven by a strong quarter for Cable revenues as we closed significant expansion deals with major cable MSO's in Europe and APAC. We also experienced continued improvement in the supply chain for our fixed wireless and fiber extension products during Q4."

Mr. Durkin continued, “Looking forward, 2023 will be a critical year for Casa Systems as we continue to bring our innovative solutions to market while focusing on a return to growth, profitability and cash-and-capital efficient operating results. Our recent success at Mobile World Congress highlighted the positive momentum in our innovative cloud-native 5G Core and MEC solutions, where several of our key partners made announcements regarding their work with Casa. Our truly cloud-native 5G Core and MEC solutions are recognized by many customers, prospects and partners as very efficient and highly scalable solutions which are optimized for next-generation cloud computing requirements, providing us great confidence that we will be able to achieve our future Cloud growth goals in 2023 and beyond. In addition, we were also awarded a large VCCAP deal late in Q4 2022 with a major European cable MSO with delivery to occur later in 2023, and new business with a US-based CSP for one of our new access device solutions, with product shipments related to this new access device award planned to occur in the second half of 2023 as well.

Mr. Durkin added, “Given this recent sales success and the improved visibility we have into our business as a result of our strong backlog entering 2023, our balance sheet deferred revenue and our strong sales pipeline starting the year, we are re-establishing annual revenue and Net Adjusted EBITDA guidance. For 2023 we expect Casa to return to growth and profitability. We believe revenues for the year will be somewhat back-end weighted due to several factors, including the timing of backlog shipments, supply chain considerations, anticipated timing of the closing of deals in our sales pipeline, revenue recognition related to deferred revenue on the balance sheet, as well as the shipment of our 4G/5G enterprise small cell radios in the second half of 2023, pursuant to closed supply contracts now in place.”

“Finally, I am pleased to report we have engaged J.P. Morgan to lead Casa’s efforts to extend our debt maturity profile prior to the contractual maturity of our Term Loan B facility which now matures in December 2023,” concluded Mr. Durkin.

Customer Dispute Successful Resolution

As previously disclosed, on July 21, 2022, Casa Systems received written notification from a significant customer of one of its international subsidiaries, of alleged costs incurred and expected to be incurred by that customer with respect to an ongoing warranty matter relating to field replacements of failed units for one particular product. The failure was attributable to an unauthorized part substitution in 2019 by a supplier to the subsidiary. This customer was seeking up to $56.0 million in recovery of past and estimated future costs. As disclosed on January 31, 2023, this matter was satisfactorily and amicably resolved in Q4, and there was no material change to the warranty settlement charge of $12.9 million that was recorded in Q3 within cost of revenue. The first of four annual equal cash payments related to this settlement was made in December 2022 as provided in the settlement agreement.

Term Loan B Refinancing

Casa Systems has retained J.P. Morgan Chase Bank, N.A. (“J.P. Morgan”) to assist the Company in analyzing and evaluating potential alternatives for our Term Loan B facility maturity.

2023 Financial Outlook and Current Guidance

For the fiscal year 2023, the Company currently expects:

  • Revenue between $300 million and $325 million
  • Positive Net Adjusted EBITDA for the year

Recent Verbal Notification from Major Cable Customer

Casa Systems was recently notified by a major North American cable customer that the Company will not currently be receiving orders from this large customer related to their cable broadband infrastructure upgrade project, which the Company had anticipated receiving in the second half of 2023. This recent development has been reflected in the foregoing 2023 financial guidance provided by the Company.

No Exposure To Silicon Valley Bank (“SVB”) Failure

The Company has no cash exposure to the recent Silicon Valley Bank failure, as the Company had no cash deposits with SVB. The Company uses Bank of America for the vast majority of its banking requirements, including cash management.

Conference Call Information

Casa Systems is hosting a conference call for analysts and investors to discuss its financial results for the fourth quarter and year ended December 31, 2022, and its business outlook at 5:00 p.m. Eastern Time today, March 14, 2023. The conference call can be heard via webcast in the investor relations section its website at http://investors.casa-systems.com, or by dialing 1-877-407-4019 in the United States or 1-201-689-8337 from international locations with Conference ID 13735450. Shortly after the conclusion of the conference call, a replay of the audio webcast will be available in the investor relations section of Casa Systems’ website for 90 days after the event.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this press release, including statements regarding the projected results of operations and financial position of Casa Systems, Inc. (“Casa Systems” or "Casa" or the “Company” or “we”), including financial targets, business strategy, and plans and objectives for future operations, are forward-looking statements. The words “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “are optimistic”, “plan”, “potential”, “predict”, “project”, “target”, “should”, “will”, “would”, and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We have based these forward-looking statements on our estimates and assumptions of our financial results and our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs as of the date of this press release. A number of important risk factors could cause actual results to differ materially from the results described, implied or projected in these forward-looking statements. These factors include, without limitation: (1) our ability to fulfill our customers’ orders due to supply chain delays, access to key commodities or technologies or events that impact our manufacturers or their suppliers, including the lingering effects of the COVID-19 pandemic; (2) any failure by us to successfully anticipate technological shifts, market needs and opportunities, and develop new products and product enhancements that meet those technological shifts, needs and opportunities; (3) the concentration of a substantial portion of our revenue in certain customers; (4) fluctuations in our revenue due to timing of large orders and seasonality; (5) the length and lack of predictability of our sales cycle; (6) any difficulties we may face in expanding our platform into the wireless market; (7) any failure to maintain the synergies we have realized from our acquisition of NetComm; (8) increases or decreases in our expenses caused by fluctuations in foreign currency exchange rates and interest rates; (9) our ability to effectively transition our chief executive officer role and (10) other factors discussed in the “Risk Factors” section of our public reports filed with the Securities and Exchange Commission (the “SEC”), including our most recent Quarterly Report on Form 10-Q and our most recent Annual Report on Form 10-K, which are on file with the SEC and available in the investor relations section of our website at http://investors.casa-systems.com and on the SEC’s website at www.sec.gov. In addition, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements that we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this press release are inherently uncertain and may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Accordingly, you should not rely upon forward-looking statements as predictions of future events. We disclaim any obligation to update publicly or revise any forward-looking statements for any reason after the date of this press release. Any reference to our website address in this press release is intended to be an inactive textual reference only and not an active hyperlink.

Non-GAAP Financial Measures

To supplement our financial results presented in accordance with Generally Accepted Accounting Principles ("GAAP"), we are presenting the following non-GAAP financial measures in this press release and the related earnings conference call: non-GAAP net income, non-GAAP diluted net income per share, adjusted EBITDA, net adjusted EBITDA and free cash flow. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similarly titled measures presented by other companies.

Non-GAAP net income and non-GAAP diluted net income per share. We define non-GAAP net income as net (loss) income as reported in our condensed consolidated statements of operations, excluding the impact of stock-based compensation expense and amortization of acquired intangible assets, which are non-cash charges; adjustments to the tax provision for the CARES Act; and the tax effect on these excluded items. We believe that excluding amortization expense of acquired intangible assets results in more useful disclosure to investors and others as it is a significant non-cash charge related to an event that is generally infrequent based on our historical activities. We further note that while amortization of acquired intangible assets is excluded from the measures, the revenue of the acquired company is reflected in the measures and the acquired assets contribute to revenue generation. The tax effect of the excluded items was calculated based on specific calculations of each item’s effect on the tax provision. We believe that excluding these discrete tax benefits from our effective income tax rate results in more useful disclosure to investors and others regarding income tax effects of excluded items as these amounts may vary from period to period independent of the operating performance of our business. We define non-GAAP diluted net income per share as diluted net (loss) income per share reported in our condensed consolidated statements of operations, excluding the impact of items that we exclude in calculating non-GAAP net income. We have presented non-GAAP net income and non-GAAP diluted net income per share because they are key measures used by our management and board of directors to understand and evaluate our operating performance, to establish budgets and to develop operational goals for managing our business. The presentation of non-GAAP net income and non-GAAP diluted net income per share also allows our management and board of directors to make additional comparisons of our results of operations to other companies in our industry.

Adjusted EBITDA. We define adjusted EBITDA as our net (loss) income, excluding the impact of stock-based compensation expense; other income (expense), net; depreciation and amortization expense; and our (benefit from) provision for income taxes. We have presented adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our operating performance, to establish budgets and to develop operational goals for managing our business. In particular, we believe that, by excluding the impact of these expenses, adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance.

Net Adjusted EBITDA. We define net adjusted EBITDA as our net (loss) income, excluding the impact of items that we exclude in calculating adjusted EBITDA; and our warranty settlement provision, as warranty provisions of this significance have not and are not expected to impact our results on a recurring basis. Management and the board of directors believe that, by excluding the impact of this expense, net adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance.

Free cash flow. We define free cash flow as net cash provided by operating activities minus capital expenditures. We believe free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that, after purchases of property, equipment and software licenses, can be used for strategic opportunities, including investing in our business, making strategic acquisitions and strengthening our balance sheet.

We use these non-GAAP financial measures to evaluate our operating performance and trends and to make planning decisions. We believe that each of these non-GAAP financial measures helps identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude in the calculations of each non-GAAP financial measure. Accordingly, we believe that these financial measures provide useful information to investors and others in understanding and evaluating our operating results and enhance the overall understanding of our past performance and future prospects.

Our non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures rather than the most directly comparable financial measures calculated and presented in accordance with GAAP. Some of these limitations are:

  • each of non-GAAP net income, non-GAAP diluted net income per share, adjusted EBITDA and net adjusted EBITDA exclude stock-based compensation expense and amortization of acquired intangible assets because they have recently been, and will continue to be for the foreseeable future, a significant recurring non-cash expense for our business;
     
  • adjusted EBITDA and net adjusted EBITDA exclude depreciation and amortization expense, and although this is a non-cash expense, the assets being depreciated and amortized may have to be replaced in the future;
     
  • adjusted EBITDA and net adjusted EBITDA do not reflect the cash requirements necessary to service interest on our debt or the cash received from our interest-bearing financial assets, both of which impact the cash available to us;
     
  • adjusted EBITDA and net adjusted EBITDA do not reflect foreign currency transaction gains and losses, which are reflected in other income (expense), net;
     
  • adjusted EBITDA and net adjusted EBITDA do not reflect income tax payments that reduce cash available to us;
     
  • net adjusted EBITDA does not reflect the estimated warranty settlement provision which is expected to reduce cash available to us;
     
  • free cash flow may not represent our residual cash flow available for discretionary expenditures, since we may have other non-discretionary expenditures that are not deducted from this measure;
     
  • free cash flow may not represent the total increase or decrease in cash and cash equivalents for any given period because it excludes cash provided by or used for other investing and financing activities; and
     
  • other companies, including companies in our industry, may not use or report non-GAAP net income, non-GAAP diluted net income per share, adjusted EBITDA, net adjusted EBITDA or free cash flow, or may calculate such non-GAAP financial measures in a different manner than we do, or may use other non-GAAP financial measures to evaluate their performance, all of which could reduce the usefulness of these non-GAAP financial measures as comparative measures.

For the reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “Reconciliation of Selected GAAP and Non-GAAP Financial Measures.” We are not able to provide a reconciliation of non-GAAP Net Adjusted EBITDA guidance for future periods to net income (loss), the comparable GAAP measure, because certain items that are excluded from non-GAAP Net Adjusted EBITDA cannot be reasonably predicted or are not in our control.

About Casa Systems, Inc.

Casa Systems, Inc. (Nasdaq: CASA) delivers the core-to-customer building blocks to speed 5G transformation with future-proof solutions and cutting-edge bandwidth for all access types. In today’s increasingly personalized world, Casa Systems creates disruptive architectures built specifically to meet the needs of service provider networks. Our suite of open, cloud-native network solutions unlocks new ways for service providers to build networks without boundaries and maximize revenue-generating capabilities. Commercially deployed in more than 70 countries, Casa Systems serves over 475 Tier 1 and regional communications service providers worldwide. For more information, visit http://www.casa-systems.com.

CONTACT INFORMATION:
IR Contacts
Dennis Daly
Casa Systems
978-688-6706 ext. 6310
investorrelations@casa-systems.com

or

Mike Cummings or Jackie Marcus
Alpha IR Group
617-982-0475
investorrelations@casa-systems.com

Source: Casa Systems


CASA SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except per share amounts)

    Three Months Ended December 31,     Year Ended December 31,  
    2022     2021     2022     2021  
Revenue   $ 84,403     $ 105,099     $ 286,537     $ 401,325  
Cost of revenue     48,531       59,098       170,068       213,145  
Warranty settlement provision     (104 )           12,803        
Gross profit     35,976       46,001       103,666       188,180  
Operating expenses:                        
Research and development     17,698       20,883       85,243       84,362  
Selling, general and administrative     20,162       21,071       86,903       85,563  
Total operating expenses     37,860       41,954       172,146       169,925  
(Loss) income from operations     (1,884 )     4,047       (68,480 )     18,255  
Other income (expense):                        
Interest income     1,182       65       2,300       362  
Interest expense     (5,350 )     (3,072 )     (17,620 )     (14,958 )
Gain on extinguishment of debt     2,728             2,728        
(Loss) gain on foreign currency, net     (359 )     (760 )     1,730       (2,113 )
Other income, net     467       1,314       752       1,948  
Total other expense, net     (1,332 )     (2,453 )     (10,110 )     (14,761 )
(Loss) income before (benefit from) provision for income taxes     (3,216 )     1,594       (78,590 )     3,494  
(Benefit from) provision for income taxes     (4,456 )     67       615       287  
Net income (loss)   $ 1,240     $ 1,527     $ (79,205 )   $ 3,207  
                         
Net income (loss) per share:                        
Basic   $ 0.01     $ 0.02     $ (0.86 )   $ 0.04  
Diluted   $ 0.01     $ 0.02     $ (0.86 )   $ 0.04  
                         
Weighted-average shares used to compute net income (loss) per share:                        
Basic     94,642       86,048       91,596       85,253  
Diluted     96,182       88,220       91,596       88,857  


CASA SYSTEMS, INC.
RECONCILIATION OF SELECTED GAAP AND NON-GAAP FINANCIAL MEASURES
(unaudited)
(in thousands)

    Three Months Ended December 31,     Twelve Months Ended December 31,  
    2022     2021     2022     2021  
Reconciliation of Net Income (Loss) to Non-GAAP Net Income (Loss):                        
Net income (loss)   $ 1,240     $ 1,527     $ (79,205 )   $ 3,207  
Stock-based compensation     4,103       3,574       13,281       14,819  
Amortization of acquired intangible assets     1,347       1,426       5,542       5,704  
Tax benefit from release of DTA reserve           1,267             (5,830 )
Tax effect of excluded items     (1,348 )     (1,249 )     (4,718 )     (5,119 )
Non-GAAP net income (loss)   $ 5,342     $ 6,545     $ (65,100 )   $ 12,781  
Non-GAAP net income (loss) margin     6.3 %     6.2 %     (22.7 )%     3.2 %
                         
Reconciliation of Diluted Net Income (Loss) Per Share to Non-GAAP Diluted Net Income (Loss) Per Share:                        
Diluted net income (loss) per share   $ 0.01     $ 0.02     $ (0.86 )   $ 0.04  
Non-GAAP adjustments to net income (loss)     0.04       0.05       0.15       0.10  
Non-GAAP diluted net income (loss) per share   $ 0.05     $ 0.07     $ (0.71 )   $ 0.14  
Weighted-average shares used in computing diluted net income (loss) per share     96,182       88,220       91,596       88,857  
                         
Reconciliation of Net Income (Loss) to Adjusted EBITDA and Net Adjusted EBITDA:                        
Net income (loss)   $ 1,240     $ 1,527     $ (79,205 )   $ 3,207  
Stock-based compensation     4,103       3,574       13,281       14,819  
Amortization of acquired intangible assets     1,347       1,426       5,542       5,704  
Depreciation and amortization     1,690       2,268       7,831       9,976  
Other expense     1,332       2,453       10,110       14,761  
(Provision for) benefit from income taxes     (4,456 )     67       615       287  
Adjusted EBITDA     5,256       11,315       (41,826 )     48,754  
Warranty settlement provision     (104 )           12,803        
Net Adjusted EBITDA   $ 5,152     $ 11,315     $ (29,023 )   $ 48,754  
Net Adjusted EBITDA margin     6.1 %     10.8 %     (10.1 )%     12.1 %


CASA SYSTEMS, INC.
RECONCILIATION OF SELECTED GAAP AND NON-GAAP FINANCIAL MEASURES
(unaudited)
(in thousands)

    Three Months Ended December 31,     Twelve Months Ended December 31,  
    2022     2021     2022     2021  
Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow:                        
Net cash (used in) provided by operating activities   $ (20,297 )   $ 18,401     $ (8,634 )   $ 33,598  
Purchases of property and equipment and software licenses     (1,094 )     (922 )     (4,419 )     (5,326 )
Free cash flow   $ (21,391 )   $ 17,479     $ (13,053 )   $ 28,272  
                         
Summary of Stock-Based Compensation Expense:                        
Cost of revenue   $ 29     $ 42     $ 121     $ 137  
Research and development     859       694       2,972       2,665  
Selling, general and administrative     3,215       2,838       10,188       12,017  
Total   $ 4,103     $ 3,574     $ 13,281     $ 14,819  
                         
Summary of Revenue:                        
Product revenue:                        
Wireless     20,973       54,152       89,020       170,233  
Fixed-line broadband     15,279       14,808       57,904       66,017  
Cable     34,174       22,963       90,623       117,692  
Product revenue   $ 70,426     $ 91,923     $ 237,547     $ 353,942  
Service revenue:                        
Wireless     3,372       2,122       7,735       5,538  
Fixed-line broadband     871       1,560       3,898       5,034  
Cable     9,734       9,494       37,357       36,811  
Service revenue   $ 13,977     $ 13,176     $ 48,990     $ 47,383  
Total revenue   $ 84,403     $ 105,099     $ 286,537     $ 401,325  


CASA SYSTEMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands)

    December 31,     December 31,  
    2022     2021  
Assets            
Current assets:            
Cash and cash equivalents   $ 126,312     $ 154,703  
Accounts receivable, net     74,484       85,774  
Inventory     81,795       84,828  
Prepaid expenses and other current assets     2,836       5,746  
Prepaid income taxes     6,352       23,963  
Total current assets     291,779       355,014  
Property and equipment, net     19,518       23,508  
Right-of-use assets     5,199        
Accounts receivable, net of current portion           115  
Deferred tax assets           101  
Goodwill     50,177       50,177  
Intangible assets, net     25,759       31,144  
Other assets     5,862       8,648  
Total assets   $ 398,294     $ 468,707  
Liabilities and Stockholders’ Equity            
Current liabilities:            
Accounts payable   $ 29,283     $ 28,087  
Accrued expenses and other current liabilities     31,825       41,382  
Accrued income taxes     4,298       4,991  
Deferred revenue     31,305       14,473  
Lease liability     2,040        
Current portion of long-term debt, net of unamortized debt issuance costs     225,161       1,924  
Total current liabilities     323,912       90,857  
Accrued income taxes, net of current portion     6,640       7,732  
Deferred tax liabilities     1,490       5,293  
Deferred revenue, net of current portion     5,529       7,012  
Lease liability, long-term     3,416        
Long-term debt, net of current portion and unamortized debt issuance costs           274,193  
Other liabilities, net of current portion     7,906       1,701  
Total liabilities     348,893       386,788  
             
Stockholders’ equity:            
Common stock     98       88  
Treasury stock     (14,837 )     (13,645 )
Additional paid-in capital     244,675       193,654  
Accumulated other comprehensive (loss) income     (2,305 )     878  
Accumulated deficit     (178,230 )     (99,056 )
Total stockholders’ equity     49,401       81,919  
Total liabilities and stockholders’ equity   $ 398,294     $ 468,707  


CASA SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)

    Year Ended December 31,  
    2022     2021  
Operating activities:            
Net (loss) income   $ (79,205 )   $ 3,207  
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:            
Depreciation and amortization     13,373       15,680  
Stock-based compensation     13,281       14,819  
Deferred income taxes     (3,702 )     (931 )
Change in provision for excess and obsolete inventory     17,245       2,070  
Change in provision for doubtful accounts     519       59  
Gain on disposal of assets     275       37  
Non-cash operating lease expense     2,370        
Gain on extinguishment of debt     (2,728 )      
Changes in operating assets and liabilities:            
Accounts receivable     10,522       8,186  
Inventory     (14,419 )     14,101  
Prepaid expenses and other assets     5,658       (2,017 )
Prepaid income taxes     17,618       (9,884 )
Accounts payable     1,978       (12,046 )
Accrued expenses and other current liabilities     (2,677 )     2,148  
Operating lease liabilities     (2,366 )      
Accrued income taxes     (1,786 )     (4,240 )
Deferred revenue     15,410       2,409  
Net cash (used in) provided by operating activities     (8,634 )     33,598  
Investing activities:            
Purchases of property and equipment     (3,705 )     (3,887 )
Purchases of software licenses     (714 )     (1,439 )
Net cash used in investing activities     (4,419 )     (5,326 )
Financing activities:            
Principal repayments of debt     (48,878 )     (16,275 )
Proceeds from exercise of stock options     327       2,262  
Employee taxes paid related to net share settlement of equity awards     (2,106 )     (6,465 )
Proceeds from sale of common stock, net of issuance costs     39,370        
Payments of dividends and equitable adjustments     (1 )     (98 )
Repurchases of common stock     (1,192 )     (8,819 )
Net cash used in financing activities     (12,480 )     (29,395 )
Effect of exchange rate changes on cash and cash equivalents     (2,846 )     466  
Net decrease in cash, cash equivalents and restricted cash     (28,379 )     (657 )
Cash, cash equivalents and restricted cash at beginning of period     157,804       158,461  
Cash, cash equivalents and restricted cash at end of period   $ 129,425     $ 157,804  
Supplemental disclosures of cash flow information:            
Cash paid for interest   $ 16,134     $ 16,944  
Cash paid for income taxes   $ 7,911     $ 10,194  
Supplemental disclosures of non-cash operating, investing and financing activities:            
Purchases of property and equipment included in accounts payable   $ 90     $ 200  


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