該公司與GreenBox簽訂了客戶合同，涉及系統實施。截止到2024年6月29日的三個月和九個月，相關的營業收入爲$1.9 百萬。與該客戶合同相關的營業收入被確認。應收賬款爲$38.6 百萬，來自於，並且 no 截至2024年6月29日，GreenBox的未開票應收款項爲$35.7 截止到2024年6月29日，與GreenBox的合同相關的遞延收入爲$ no 截至2023年6月24日，GreenBox的營業收入爲 no 截至2023年9月30日，GreenBox的應收賬款、未開票應收款或遞延收入。對GreenBox的資金爲$66.5 公司向GreenBox提供了$百萬的資金，涉及VIE（詳見第15條，變量利益實體），用於截至2024年6月29日的三個月和九個月。 不 這筆資金是用於截至2023年6月24日的三個月或九個月。
在公司正常的業務過程中，公司會簽訂各種合同，其中可能同意對其他方因相關合同中定義的某些事件（例如訴訟、監管罰款或與過去表現相關的索賠）而產生的損失進行賠償。這種賠償義務可能不受最高損失條款的限制。公司從未爲防禦訴訟或解決與這些賠償義務相關的索賠而產生費用。因此，公司認爲這些義務的估計公允價值是微不足道的。因此，公司已 no 在截至2024年6月29日和2023年9月30日的日期記錄了這些義務的負債。
Effect of stock-based compensation expense on income by line item (in thousands):
Three Months Ended
Nine Months Ended
June 29, 2024
June 24, 2023
June 29, 2024
June 24, 2023
Cost of revenue, Systems
$
3,401
$
10
$
9,955
$
26
Cost of revenue, Software maintenance and support
116
1,302
351
1,397
Cost of revenue, Operation services
290
2,820
1,502
3,462
Research and development
12,819
16,220
37,905
54,805
Selling, general, and administrative
12,706
16,647
37,145
62,072
Total stock-based compensation expense
$
29,332
$
36,999
$
86,858
$
121,762
Total stock-based compensation expense for the nine months ended June 29, 2024 decreased as compared to the nine months ended June 24, 2023 as a result of the issuance of restricted stock to our employees in August 2022 following the Business Combination with application of the graded-vesting method of expense recognition. There was no such grant in the same period of fiscal year 2023.
Warrant Units
GreenBox Warrant
On July 23, 2023, in connection with the Commercial Agreement, the Company issued Sunlight the GreenBox Warrant to acquire up to an aggregate of 11,434,360 shares of the Company’s Class A Common Stock, subject to certain vesting conditions. The GreenBox Warrant had a grant date fair value of $19.90 per share. The GreenBox Warrant may vest in connection with conditions defined by the terms of the GreenBox Warrant, as GreenBox makes additional expenditures to the Company in connection with the Framework Agreement. There are up to eight tranches based on increments of expenditures where approximately 1,429,295 additional shares may vest per tranche, subject to certain conditions defined by the terms of the GreenBox Warrant. Upon vesting, the shares may be acquired at an exercise price of $41.9719. The GreenBox Warrant contains customary anti-dilution, down-round, and change-in-control provisions. The right to purchase shares pursuant to the GreenBox Warrant expires 36 months following the end of the initial term of the Framework Agreement, which is July 23, 2027, or, if applicable, the extension term of the Framework Agreement, which is July 23, 2029. As of June 29, 2024, none of the shares exercisable pursuant to the GreenBox Warrant had vested.
Walmart Warrant
On May 20, 2022, the Company entered into the Second Amended and Restated Master Automation Agreement with Walmart and issued Walmart a warrant to acquire up to an aggregate of 258,972 Legacy Warehouse Class A Units (“May 2022 Warrant”), subject to certain vesting conditions. The May 2022 Warrant had a grant date fair value of $224.45. In connection with the closing of the Company’s initial public offering in June 2022, the May 2022 Warrant was converted into a new warrant to acquire up to an aggregate of 15,870,411 common units of Symbotic Holdings (“June 2022 Warrant” and, the common units of Symbotic Holdings issuable thereunder, the “Warrant Units”). The June 2022 Warrant vested in the second quarter of fiscal year 2023, as the installation commencement date for certain Systems which the Company is installing in Walmart’s 42 regional distribution centers had occurred. In December 2023, Walmart elected to gross exercise the vested warrants for $158.7 million. As a result of this gross exercise, 15,870,411 shares of Class V-1 Common Stock were issued to Walmart.
18. Segment and Geographic Information (As Restated)
The Company operates as one operating segment. Revenue and property and equipment, net by geographic region, based on physical location of the operations recording the sale or the assets are as follows:
Revenue by geographical region for the three and nine months ended June 29, 2024 and June 24, 2023 are as follows (in thousands):
Three Months Ended
Nine Months Ended
June 29, 2024
June 24, 2023
June 29, 2024
June 24, 2023
As Restated
As Restated
United States
$
469,530
$
310,946
$
1,220,753
$
782,328
Canada
808
891
2,860
2,675
Total revenue
$
470,338
$
311,837
$
1,223,613
$
785,003
Percentage of revenue generated outside of the United States (a)
immaterial
immaterial
immaterial
immaterial
(a) The percentage of revenue generated outside of the United States for the three and nine months ended June 29, 2024 and June 24, 2023 was immaterial.
Total property and equipment, net by geographical region at June 29, 2024 and at September 30, 2023 are as follows (in thousands):
June 29, 2024
September 30, 2023
United States
$
80,638
$
33,828
Canada
391
679
Total property and equipment, net
$
81,029
$
34,507
Percentage of property and equipment, net held outside of the United States (a)
immaterial
2
%
(a) The percentage of property and equipment, net held outside of the United States as of June 29, 2024 was immaterial.
19. Subsequent Events
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed consolidated financial statements were issued. Other than as described in these condensed consolidated financial statements and below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements.
On July 19, 2024, the Company entered into an Asset Purchase Agreement with Veo Robotics, Inc. (“Veo”), pursuant to which certain assets and certain liabilities of Veo were acquired by the Company. The total purchase price for this transaction was $8.7 million and the transaction will be accounted for as an asset acquisition.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q/A and our audited consolidated financial statements and related notes thereto as of and for the year ended September 30, 2023, as included within our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on December 11, 2023. As discussed in the section titled “Cautionary Note on Forward-Looking Statements,” the following discussion and analysis contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section titled “Risk Factors” included under Part II, Item 1A below.
Restatement of Previously Issued Unaudited Condensed Consolidated Financial Statements
In this Quarterly Report on Form 10-Q/A, we have restated our previously issued unaudited condensed consolidated financial statements. Refer to the “Explanatory Note” preceding “Cautionary Note on Forward-Looking Statements” for background on the restatement, the fiscal periods impacted, and other information. As a result, we have also restated certain previously reported financial information for the three and nine months ended June 29, 2024 in this “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” including but not limited to information within the “Results of Operations,” “Non-GAAP Financial Measures,” and “Liquidity and Capital Resources” sections to conform the discussion with the appropriate restated amounts. See “Item 1. Unaudited Condensed Consolidated Financial Statements, Note 3, Restatement of Previously Issued Unaudited Condensed Consolidated Financial Statements” for additional information related to the Restatement.
Company Overview
Our vision is to make the supply chain work better for everyone. We do this by developing, commercializing, and deploying innovative, end-to-end technology solutions that dramatically improve supply chain operations. We currently automate the processing of pallets and cases in large warehouses or distribution centers for some of the largest retail companies in the world. Our systems enhance operations at the front end of the supply chain, and therefore benefit all supply partners further down the chain, irrespective of fulfillment strategy.
Our platform is based on a unique approach to connecting producers of goods to end users, in a way that resolves the mismatches of quantity, timing and location that arise between the two, while reducing costs. The underlying architecture of our platform is what differentiates our solution from anything else in the marketplace. It utilizes fully autonomous robots, collectively controlled by our A.I. enabled system software to achieve at scale, real world supply chain improvements that are so compelling that we believe our approach can become the de facto standard approach for how warehouses operate.
Key Components of Consolidated Statements of Operations
Revenue
We generate revenue through our design and installation of modular inventory management systems (the “Systems”) to automate customers’ depalletizing, storage, selection, and palletization warehousing processes. The Systems have both a hardware component and an embedded software component that enables the systems to be programmed to operate within specific customer environments. We enter into contracts with customers that can include various combinations of services to design and install the Systems. These services are generally distinct and accounted for as separate performance obligations. As a result, each customer contract may contain multiple performance obligations. We determine whether performance obligations are distinct based on whether the customer can benefit from the product or service on its own or together with other resources that are readily available and whether our commitment to provide the services to the customer is separately identifiable from other obligations in the contract.
We have identified the following distinct performance obligations in our contracts with customers:
Systems: We design, assemble, and install modular hardware systems and perform configuration of embedded software. Systems include the delivery of hardware and an embedded software component, sold as either a perpetual or term-based on-premise license, that automate our customers’ depalletizing, storage, selection, and palletization warehousing processes. The modular hardware and embedded software are each not capable of being distinct because our customers cannot benefit from
the hardware or software on their own. Accordingly, they are treated as a single performance obligation. Fees for systems are typically either fixed or cost-plus fixed fee amounts that are due based on the achievement of a variety of milestones beginning at contract inception through final acceptance. The substantial majority of our embedded software component is sold as a perpetual on-premise license, however, we do sell an immaterial amount of term-based on-premise licenses.
The key metrics which describe our System from commencement to completion are as follows: (1) “Start” is defined as when we sign a Statement of Work (“SOW”) with a customer; (2) “Deployment” is defined as the period of time following the signed SOW until the acceptance of the System; (3) “Operational” is defined as achieving acceptance of a System. The majority of Systems revenue occurs during Deployment, and once a System reaches acceptance, software maintenance and support begins.
Software maintenance and support: “Software Maintenance and Support” is defined as support services that provide our customers with technical support, updates, and upgrades to the embedded software license. Fees for Software Maintenance and Support are typically payable in advance on a quarterly, or annual basis over the term of the Software Maintenance and Support contract, which term can range from one to 15 years but, for a substantial majority of our Software Maintenance and Support contracts, is 15 years.
Operation services: We provide our customers with assistance operating the System and ensuring user experience is optimized for efficiency and effectiveness (“Operation Services”). Fees for Operation Services are typically invoiced to our customers on a time and materials basis monthly in arrears or using a fixed fee structure. Also included in Operation Services is revenue generated from the sales of spare parts to our customers as needed to service their System.
Cost of Revenue
Our cost of revenue is composed of the following for each of our distinct performance obligations:
Systems: Systems cost of revenue consists primarily of material and labor consumed in the production and installation of Systems, as well as depreciation expense. The design, assembly, and installation of a System includes substantive customer-specified acceptance criteria that allow the customer to accept or reject Systems that do not meet the customer’s specifications. When we cannot objectively determine that acceptance criteria will be met upon contract inception, cost of revenue relating to Systems is deferred and expensed at a point in time upon final acceptance from the customer. If acceptance criteria can be reasonably certain upon contract inception, Systems cost of revenue is expensed as incurred.
Software Maintenance and Support: Cost of revenue attributable to Software Maintenance and Support primarily relates to labor cost for our maintenance team providing routine technical support, and maintenance updates and upgrades to our customers. Software Maintenance and Support cost of revenue is expensed as incurred.
Operation Services: Operation Services cost of revenue consists primarily of labor cost for our operations team who is providing services to our customers to run their System within their distribution center. Operation Services cost of revenue also includes the cost of spare parts sold to our customers as needed to service their System. Operation Services cost of revenue is expensed as incurred.
Research and Development
Costs incurred in the research and development of our products are expensed as incurred. Research and development costs include personnel, contracted services, materials, and indirect costs involved in the design and development of new products and services, as well as depreciation expense.
Selling, General, and Administrative
Selling, general, and administrative expenses include all costs that are not directly related to satisfaction of customer contracts or research and development. Selling, general, and administrative expenses include items for our selling and administrative functions, such as sales, finance, legal, human resources, and information technology support. These functions include costs for items such as salaries and benefits and other personnel-related costs, maintenance and supplies, professional fees for external legal, accounting, and other consulting services, intangible asset amortization, and depreciation expense.
Other Income (Expense), Net
Other income (expense), net primarily consists of dividend and interest income earned on our money market accounts and the impact of foreign currency transaction gains and losses associated with monetary assets and liabilities.
We are subject to U.S. federal income taxes, in addition to state and local income taxes, with respect to our allocable share of any taxable income or loss of Symbotic Holdings. We also have foreign subsidiaries which are subject to income tax in their local jurisdictions.
Results of Operations for the Three and Nine Months Ended June 29, 2024 and June 24, 2023
The following tables set forth our results of operations for the periods presented and as a percentage of our total revenue for those periods. The data has been derived from the unaudited condensed consolidated financial statements contained in this Quarterly Report on Form 10-Q/A which include, in our opinion, all adjustments, consisting only of normal recurring adjustments, that we consider necessary for a fair statement of the financial position and results of operations for the interim periods presented. The period-to-period comparison of financial results is not necessarily indicative of financial results to be achieved in future periods.
For the Three Months Ended
For the Nine Months Ended
June 29, 2024
June 24, 2023
June 29, 2024
June 24, 2023
As Restated
As Restated
(in thousands)
Revenue:
Systems
$
450,595
$
302,350
$
1,168,993
$
757,854
Software maintenance and support
3,545
1,768
8,280
4,466
Operation services
16,198
7,719
46,340
22,683
Total revenue
470,338
311,837
1,223,613
785,003
Cost of revenue:
Systems
398,761
244,660
1,024,832
618,651
Software maintenance and support
2,539
3,603
6,201
7,380
Operation services
14,065
10,665
43,331
28,022
Total cost of revenue
415,365
258,928
1,074,364
654,053
Gross profit
54,973
52,909
149,249
130,950
Operating expenses:
Research and development expenses
44,722
48,845
133,327
149,251
Selling, general, and administrative expenses
47,871
46,073
143,535
150,994
Total operating expenses
92,593
94,918
276,862
300,245
Operating loss
(37,620)
(42,009)
(127,613)
(169,295)
Other income, net
11,615
2,937
27,626
7,055
Loss before income tax and equity method investment
Loss before income tax and equity method investment
(6)
(13)
(8)
(21)
Income tax benefit (expense)
—
—
—
—
Loss from equity method investment
—
—
—
—
Net loss
(6)
%
(13)
%
(8)
%
(21)
%
*Percentages are based on actual values. Totals may not sum due to rounding.
Three and Nine Months Ended June 29, 2024 Compared to the Three and Nine Months Ended June 24, 2023
Revenue
For the Three Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
As Restated
As Restated
As Restated
(dollars in thousands)
Systems
$
450,595
$
302,350
$
148,245
49
%
Software maintenance and support
3,545
1,768
1,777
101
%
Operation services
16,198
7,719
8,479
110
%
Total revenue
$
470,338
$
311,837
$
158,501
51
%
Systems revenue increased during the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, due to 39 Deployments during the fiscal quarter ending June 29, 2024, as compared to 33 Deployments during the same quarter of fiscal 2023. The increase in Deployments is primarily due to the Master Automation Agreement. Pursuant to the Master Automation Agreement, we are installing and implementing our System within all of Walmart’s 42 regional distribution centers. We expect the Master Automation Agreement to continue to generate Systems revenue as we install and implement the Systems at the remaining regional distribution centers through fiscal year 2028.
The increase in Software Maintenance and Support revenue is due to 21 System sites operational and under Software Maintenance and Support contracts for the three months ended June 29, 2024, as compared to 10 System sites operational and under Software Maintenance and Support contracts for three months ended June 24, 2023.
The increase in Operation Services revenue is attributable to an increase in System sites where we are performing Operation Services during the three months ended June 29, 2024, as compared to the three months ended June 24, 2023. This results from the number of Deployments and spare parts sales to our customers during the three months ended June 29, 2024, as compared to the three months ended June 24, 2023.
For the Nine Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
As Restated
As Restated
As Restated
(dollars in thousands)
Systems
$
1,168,993
$
757,854
$
411,139
54
%
Software maintenance and support
8,280
4,466
3,814
85
%
Operation services
46,340
22,683
23,657
104
%
Total revenue
$
1,223,613
$
785,003
$
438,610
56
%
Systems revenue increased during the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, due to 39 Deployments during the fiscal quarter ending June 29, 2024, as compared to 33 Deployments during the same quarter of fiscal 2023. The increase in Deployments is primarily due to the Master Automation Agreement with Walmart. Pursuant to the Master Automation Agreement, we are performing the installation and implementation of our System within all of Walmart’s 42 regional distribution centers. We expect this to continue to produce Systems revenue as the Systems are installed and implemented at the remaining regional distribution centers through fiscal year 2028.
The increase in Software Maintenance and Support revenue is due to 21 System sites operational and under Software Maintenance and Support contracts for the nine months ended June 29, 2024, as compared to 10 System sites operational and under Software Maintenance and Support contracts for nine months ended June 24, 2023.
The increase in Operation Services revenue is attributable to an increase in System sites where we are performing Operation Services during the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023. This results from an increase in Deployments as well as an increase in spare parts sales to our customers during the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023.
Gross Profit
The following table sets forth our gross profit for the three months ended June 29, 2024 and June 24, 2023:
For the Three Months Ended
Change
June 29, 2024
June 24, 2023
Amount
As Restated
As Restated
(in thousands)
Systems
$
51,834
$
57,690
$
(5,856)
Software maintenance and support
1,006
(1,835)
2,841
Operation services
2,133
(2,946)
5,079
Total gross profit
$
54,973
$
52,909
$
2,064
Systems gross profit decreased $(5.9) million during the three months ended June 29, 2024, as compared to the three months ended June 24, 2023. The decrease in gross profit is primarily driven by elongated construction schedules and implementation costs associated with the prior quarter’s rapid pace of innovation, as well as cost overruns on certain deployments during the third quarter of fiscal year 2024 that will not be billable.
The increase in Software Maintenance and Support gross profit is driven by the revenue provided from the additional Systems in Deployment for the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, while costs to perform our Software Maintenance and Support services remained relatively flat.
The increase in Operation Services gross profit during the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, is driven by an increase in the number of System sites where we are performing Operation
Services, efficiency improvement on our existing Operation Services System sites, and profit generated from the sales of spare parts.
The following table sets forth our gross profit for the nine months ended June 29, 2024 and June 24, 2023:
For the Nine Months Ended
Change
June 29, 2024
June 24, 2023
Amount
As Restated
As Restated
(in thousands)
Systems
$
144,161
$
139,203
$
4,958
Software maintenance and support
2,079
(2,914)
4,993
Operation services
3,009
(5,339)
8,348
Total gross profit
$
149,249
$
130,950
$
18,299
Systems gross profit increased $5.0 million during the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023. The increase in Systems gross profit was partially driven by the increase in Deployments in fiscal year 2024 as compared to fiscal year 2023. This increase was offset by a charge in the second quarter of fiscal year 2024 related to the completion of our restructuring to outsource bot assembly and component inventory management, including standardizing on Symbot as our go-ahead bot platform.
The increase in Software Maintenance and Support gross profit is driven by the revenue provided from the additional Systems in Deployment for the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, while costs to perform our Software Maintenance and Support services remained relatively flat.
The increase in Operation Services gross profit during the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, is driven by an increase in System sites where we are performing Operation Services, efficiency improvement on our existing Operation Services System sites, and profit generated from the sales of spare parts.
Research and Development Expenses
For the Three Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
(dollars in thousands)
Research and development
$
44,722
$
48,845
$
(4,123)
(8)
%
Percentage of total revenue (As restated)
10
%
16
%
The decrease in research and development expenses for the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, is due to the following:
Change
(in thousands)
Employee-related costs
$
(5,694)
Prototyping-related costs, allocated overhead expenses, and other
1,571
$
(4,123)
Employee-related costs decreased primarily as a result of a decrease in stock-based compensation expense and expense incurred for contractors. As we apply the graded-vesting method of expense recognition to all stock-based compensation awards with service-only conditions, higher expense was incurred for the three months ended June 24, 2023, due to the expense recognized in the third quarter of fiscal year 2023 for the issuance of restricted stock to our employees following the Business Combination. Additionally, we experienced a decrease in the expense related to contractors as a result of a combination of hiring full time employees and outsourcing certain business activities to third parties. These decreases were partially offset by an increase to payroll related costs as we continue to grow our software and hardware engineering organizations to support the development of key projects such as next generation autonomous electric vehicle robots, and also to support the continued expansion of our artificial intelligence and analytics capabilities.
Prototyping-related costs, allocated overhead expenses, and other expenses increased for the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, as a result of an increase in allocated overhead expenses allocated from selling, general, and administrative expenses to research and development expenses resulting from an increase to general overhead expenses such as rent and other occupancy expenses.
For the Nine Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
(dollars in thousands)
Research and development
$
133,327
$
149,251
$
(15,924)
(11)
%
Percentage of total revenue (As restated)
11
%
19
%
The decrease in research and development expenses for the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, is due to the following:
Change
(in thousands)
Employee-related costs
$
(18,867)
Prototyping-related costs, allocated overhead expenses, and other
2,943
$
(15,924)
Employee-related costs decreased primarily as a result of a decrease in stock-based compensation expense and expense incurred for contractors. As we apply the graded-vesting method of expense recognition to all stock-based compensation awards with service-only conditions, higher expense was incurred for the nine months ended June 24, 2023, due to the expense recognized for the issuance of restricted stock to our employees following the Business Combination. Additionally, we experienced a decrease in the expense related to contractors as a result of a combination of hiring full time employees and outsourcing certain business activities to third parties. These decreases were partially offset by an increase to payroll related costs as we continue to grow our software and hardware engineering organizations to support the development of key projects such as next generation autonomous electric vehicle robots, and also to support the continued expansion of our artificial intelligence and analytics capabilities.
The increase in prototyping-related costs, allocated overhead expenses, and other during the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, is primarily attributable to an increase in overhead expenses allocated from selling, general, and administrative expenses to research and development expenses resulting from an increase to general overhead expenses such as rent and other occupancy expenses for the nine months ended June 29, 2024.
Selling, General, and Administrative Expenses
For the Three Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
(dollars in thousands)
Selling, general, and administrative
$
47,871
$
46,073
$
1,798
4
%
Percentage of total revenue
10
%
15
%
The increase in selling, general, and administrative expenses for the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, is due to the following:
Employee-related costs decreased primarily as a result of a decrease in stock-based compensation expense and expense incurred for contractors. As we apply the graded-vesting method of expense recognition to all stock-based compensation awards with service-only conditions, higher expense was incurred for the three months ended June 24, 2023, due to the expense recognized in the third quarter of fiscal year 2023 for the issuance of restricted stock to our employees following the Business Combination. Additionally, we experienced a decrease in the expense related to contractors as a result of a combination of hiring full time employees and outsourcing certain business activities to third parties. These decreases were partially offset by an increase to payroll-related expenses incurred as our business continues to grow.
Allocated overhead and other expenses increased primarily due to an increase in information technology related costs as well as audit, tax, and legal expenses as compared to the prior year as our employee base and infrastructure continue to grow.
For the Nine Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
(dollars in thousands)
Selling, general, and administrative
$
143,535
$
150,994
$
(7,459)
(5)
%
Percentage of total revenue (As restated)
12
%
19
%
The decrease in selling, general, and administrative expenses for the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, is due to the following:
Change
(in thousands)
Employee-related costs
$
(32,428)
Allocated overhead expenses and other
24,969
$
(7,459)
Employee-related costs decreased primarily as a result of a decrease in stock-based compensation expense and expense incurred for contractors. As we apply the graded-vesting method of expense recognition to all stock-based compensation awards with service-only conditions, higher expense was incurred for the nine months ended June 24, 2023, due to the expense recognized for the issuance of restricted stock to our employees following the Business Combination. Additionally, we experienced a decrease in the expense related to contractors as a result of a combination of hiring full time employees and outsourcing certain business activities to third parties. These decreases were partially offset by an increase to payroll-related expenses incurred as our business continues to grow.
Allocated overhead and other expenses increased primarily due to an increase in information technology related costs as well as audit, tax, and legal expenses as compared to the prior year as our employee base and infrastructure continue to grow.
Other income, net
For the Three Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
(dollars in thousands)
Other income, net
$
11,615
$
2,937
$
8,678
295
%
Percentage of total revenue
2
%
1
%
The increase in other income, net for the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, was due to higher interest earned on invested cash balances and marketable securities as a result of increased interest rates and higher cash balance.
The increase in other income, net for the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, was due to higher interest earned on invested cash balances and marketable securities as a result of increased interest rates and higher cash balance.
Income Taxes
For the Three Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
As Restated
As Restated
As Restated
(dollars in thousands)
Income tax expense
$
(182)
$
(5)
$
(177)
3540
%
Percentage of total revenue
—
%
—
%
The increase in income tax expense for the three months ended June 29, 2024, as compared to the three months ended June 24, 2023, is attributable to the expense related to our state income taxes.
For the Nine Months Ended
Change
June 29, 2024
June 24, 2023
Amount
%
As Restated
As Restated
As Restated
(dollars in thousands)
Income tax expense
$
(102)
$
(239)
$
137
(57)
%
Percentage of total revenue
—
%
—
%
The income tax expense recorded for the nine months ended June 29, 2024, as compared to the nine months ended June 24, 2023, is attributable to the expense related to our state income taxes.
Non-GAAP Financial Measures
In addition to providing financial measurements based on generally accepted accounting principles in the United States of America, or GAAP, we provide additional financial metrics that are not prepared in accordance with GAAP, or non-GAAP financial measures. We use these non-GAAP financial measures, in addition to GAAP financial measures, to understand and compare operating results across accounting periods, for financial and operational decision making, for planning and forecasting purposes, to measure executive compensation, and to evaluate our financial performance. These non-GAAP financial measures are Adjusted EBITDA, Adjusted gross profit, and Adjusted gross profit margin, as discussed below.
We believe that these non-GAAP financial measures reflect our ongoing business in a manner that allows for meaningful comparisons and analysis of trends in the business, as it facilitates comparing financial results across accounting periods and to those of peer companies. We also believe that these non-GAAP financial measures enable investors to evaluate our operating results and future prospects in the same manner as we do. These non-GAAP financial measures may exclude expenses and gains that may be unusual in nature, infrequent, or not reflective of our ongoing operating results.
The non-GAAP financial measures do not replace the presentation of our GAAP financial measures and should only be used as a supplement to, not as a substitute for, our financial results presented in accordance with GAAP.
We consider Adjusted EBITDA to be an important indicator of the operational strength and performance of our business and a good measure of our historical operating trends. Adjusted EBITDA eliminates items that we do not consider to be part of our core operations. We define Adjusted EBITDA as GAAP net loss excluding the following items: interest income; income taxes; depreciation and amortization of tangible and intangible assets; stock-based compensation; CEO transition charges; joint venture formation fees; restructuring charges; equity financing transaction costs; equity method investment; and other infrequent items that may arise from time to time.
The non-GAAP adjustments, and our basis for excluding them from our non-GAAP financial measures, are outlined below:
•Stock-based compensation – Although stock-based compensation is an important aspect of the compensation paid to our employees, the grant date fair value varies based on the derived stock price at the time of grant, varying valuation methodologies, subjective assumptions, and the variety of award types. This makes the comparison of our current financial results to previous and future periods difficult to interpret; therefore, we believe it is useful to exclude stock-based compensation from our non-GAAP financial measures in order to highlight the performance of our business and to be consistent with the way many investors evaluate our performance and compare our operating results to peer companies. Our stock-based compensation non-GAAP financial measures exclusion includes non-cash stock-based compensation expense and payroll taxes related to stock-based compensation awards.
•CEO transition charges –CEO transition charges represent the charges incurred with the separation agreement we entered into with Michael Loparco in November 2022. We exclude these CEO transition charges from our non-GAAP financial measures to provide a useful comparison of our operating results to prior periods and to our peer companies because such amounts are not representative of our normal operating activities.
•Restructuring charges – Restructuring charges represent charges associated with certain actions to restructure parts of the Company within the U.S. and Canada. These charges include severance and related expenses for workforce reductions, lower of cost and net realizable value adjustments to inventory and long-lived assets that will no longer be used in operations, and termination fees for any contracts cancelled as part of these actions. We exclude these items from our non-GAAP financial measures when evaluating our continuing business performance as such items vary significantly based on the magnitude of the restructuring action and do not reflect future expected operating expenses. In addition, these charges do not necessarily provide meaningful insight into the fundamentals of current or past operations of our business.
•Joint venture formation fees – Joint venture formation fees represent the charges incurred associated with the formation of GreenBox, which was formed on July 21, 2023. It primarily includes investment banker fees, legal fees, transaction fees, advisory fees, and certain other professional fees. We exclude joint venture formation fees from our non-GAAP financial measures to provide a useful comparison of our operating results to prior periods and peer companies because such amounts vary significantly based on the magnitude of the joint venture and do not reflect our core operations.
•Equity financing transaction costs – Equity financing transaction costs represents the costs incurred, including for legal and accountant fees, transaction fees, advisory fees, due diligence costs, and certain other professional fees that are directly related to an equity financing transaction.
•Equity method investment – Equity method investment represents our proportionate share of income or loss of unconsolidated variable interest entities. We exclude this from our non-GAAP financial measures to provide a useful comparison of our operating results to prior periods and to our peer companies because such amounts are not representative of our normal operating activities.
The following table reconciles GAAP net loss to Adjusted EBITDA for the three and nine months ended June 29, 2024 and June 24, 2023 (in thousands):
Three Months Ended
Nine Months Ended
June 29, 2024
June 24, 2023
June 29, 2024
June 24, 2023
As Restated
As Restated
Net loss
$
(26,724)
$
(39,077)
$
(100,626)
$
(162,479)
Interest income
(11,610)
(2,974)
(27,554)
(7,199)
Income tax expense
182
5
102
239
Depreciation and amortization
10,032
1,621
15,065
4,996
Stock-based compensation
30,320
37,068
94,508
123,147
CEO transition charges
—
—
—
2,026
Restructuring charges
—
—
34,206
8,373
Joint venture formation fees
—
—
1,089
—
Equity financing transaction costs
—
—
1,985
—
Equity method investment
537
—
537
—
Adjusted EBITDA
$
2,737
$
(3,357)
$
19,312
$
(30,897)
The following table presents the effects of the Restatement on the Adjusted EBITDA non-GAAP financial measure (in thousands):
Three Months Ended June 29, 2024
Nine Months Ended June 29, 2024
As Reported
Adjustment
As Restated
As Reported
Adjustment
As Restated
Net loss
$
(14,204)
$
(12,520)
$
(26,724)
$
(68,123)
$
(32,503)
$
(100,626)
Income tax expense
95
87
182
24
78
102
Adjusted EBITDA
$
15,170
$
(12,433)
$
2,737
$
51,737
$
(32,425)
$
19,312
We consider Adjusted gross profit and Adjusted gross profit margin to be important indicators of profitability, which we use in our financial and operational decision-making and evaluation of our overall operating performance. We define Adjusted gross profit, a non-GAAP financial measure, as GAAP gross profit excluding the following items: depreciation, stock-based compensation expense, and restructuring charges. We define Adjusted gross profit margin, a non-GAAP financial measure, as non-GAAP Adjusted gross profit divided by total revenue. The following table reconciles GAAP gross profit to Adjusted gross profit and gross profit margin to Adjusted gross profit margin during the periods presented (dollars in thousands):
Three Months Ended
Nine Months Ended
June 29, 2024
June 24, 2023
June 29, 2024
June 24, 2023
As Restated
As Restated
Gross profit
$
54,973
$
52,909
$
149,249
$
130,950
Depreciation
5,359
178
5,540
553
Stock-based compensation
3,807
4,124
12,394
4,895
Restructuring charges
—
—
34,206
5,240
Adjusted gross profit
$
64,139
$
57,211
$
201,389
$
141,638
Gross profit margin
11.7
%
17.0
%
12.2
%
16.7
%
Adjusted gross profit margin
13.6
%
18.3
%
16.5
%
18.0
%
The following table presents the effects of the Restatement on the Adjusted gross profit and Adjusted gross profit margin non-GAAP financial measures (dollars in thousands):
As of June 29, 2024, our principal sources of liquidity were cash received upon exercise of warrants and equity financing transactions, proceeds received from the maturities of marketable securities, and cash received from customers upon the inception and continuation of contracts to install Systems.
The following table shows net cash provided by operating activities, net cash provided by (used in) investing activities, and net cash provided by (used in) financing activities for the nine months ended June 29, 2024 and June 24, 2023:
Nine Months Ended
June 29, 2024
June 24, 2023
(in thousands)
Net cash provided by (used in):
Operating activities
$
41,306
$
186,266
Investing activities
$
201,844
$
(271,460)
Financing activities
$
369,289
$
(10,726)
Operating Activities
Our net cash provided by operating activities consists of net loss adjusted for certain non-cash items, including depreciation and amortization, foreign currency gains and losses, marketable securities gains and losses, provision for excess and obsolete inventory, and stock-based compensation, as well as changes in operating assets and liabilities. The primary changes in working capital items, such as the changes in accounts receivable and deferred revenue, result from the difference in timing of payments from our customers related to Deployments and the associated costs incurred by us to fulfill the system installation performance obligation. This may result in an operating cash flow source or use for the period, depending on the timing of payments received as compared to the fulfillment of the system installation performance obligation.
Net cash provided by operating activities was $41.3 million during the nine months ended June 29, 2024. Net cash provided by operating activities was primarily due to our net loss of $(100.6) million adjusted for non-cash items of $127.9 million, primarily consisting of $17.0 million depreciation and amortization, $86.9 million stock-based compensation, and $34.1 million provision for excess and obsolete inventory, offset by cash used in operating assets and liabilities of $(14.0) million. Cash used in operating assets and liabilities of $(14.0) million was primarily driven by net working capital changes, including the timing of cash payments to vendors and cash receipts from customers.
Net cash provided by operating activities was $186.3 million during the nine months ended June 24, 2023. Net cash provided by operating activities was primarily due to our net loss of $162.5 million adjusted for non-cash items of $128.6 million, primarily consisting of $6.6 million depreciation and amortization and $121.8 million stock-based compensation, offset by cash provided by operating assets and liabilities of $220.2 million. Cash provided by operating assets and liabilities of $220.2 million was primarily driven by net working capital changes, including the timing of cash payments to vendors and cash receipts from customers, an increase in inventory purchases for the nine months ended June 24, 2023 as we purchase additional inventory in order to meet our installation timeline for our customers’ upcoming warehouse automation system installations in connection with the Walmart Master Automation Agreement and other customer contracts, as well as an increase in deferred revenue for the nine months ended June 24, 2023 resulting from an increase in the number of active system installation projects.
Our investing activities have consisted primarily of property and equipment purchases, capitalization of internal use software development costs, purchases of marketable securities, and proceeds from maturities of marketable securities.
Net cash and cash equivalents provided by investing activities during the nine months ended June 29, 2024 is primarily driven by $340.0 million in proceeds upon the maturity of certain U.S. Treasury securities, offset by purchases of U.S. Treasury securities of $48.7 million. Additionally, we purchased strategic investments of $66.5 million. No other significant investing activities occurred during the nine months ended June 29, 2024.
Net cash and cash equivalents used in investing activities during the nine months ended June 24, 2023 consisted of $20.4 million of purchased property and equipment. Additionally, during the nine months ended June 24, 2023, we purchased U.S. Treasury securities for $301.1 million, and received proceeds of $50.0 million upon the maturity of certain U.S. Treasury securities.
Financing Activities
Our financing activities typically consist of payments and proceeds related to our equity incentive plans for RSUs and our ESPP, and also include proceeds from the exercise of the vested warrants issued to Walmart as well as proceeds from equity financing transactions.
During the nine months ended June 29, 2024, we received cash of $158.7 million upon the gross exercise by Walmart of the vested Warrant Units, which occurred in December 2023. We additionally received proceeds of $258.0 million in relation to issuance of Class A common stock upon completion of our equity financing in March 2024. Offsetting these proceeds were distributions to Symbotic Holdings LLC partners of $47.7 million. No other significant financing activities occurred during the nine months ended June 29, 2024.
During the nine months ended June 24, 2023, we incurred a payment of $11.7 million for the taxes related to the net share settlement of stock-based compensation awards. We also received proceeds of $1.0 million from the issuance of common stock under the ESPP upon the expiration of the first offering period which occurred at the end of December 2022.
Contractual Obligations and Commitments and Liquidity Outlook
Our cash flows from operations along with equity infusions have historically been sufficient to fund our operating activities and other cash requirements. As of June 29, 2024, we have a cash and cash equivalents balance of $870.5 million. Our cash requirements for the nine months ended June 29, 2024 were primarily related to inventory purchases in order to deliver to our customers our Systems in an orderly manner in line with our installation timeline and capital expenditures.
Based on our present business plan, we expect our current cash and cash equivalents, working capital, and our forecasted cash flows from operations to be sufficient to meet our foreseeable cash needs for at least the next 12 months. Our foreseeable cash needs, in addition to our recurring operating expenses, include our expected capital expenditures to support expansion of our infrastructure and workforce, and minimum contractual obligations. Contractual obligations are cash that we are obligated to pay as part of certain contracts that we have entered into during our course of business. Our contractual obligations consist of operating lease liabilities that are included in our consolidated balance sheet and vendor commitments associated with agreements that are legally binding. Our operating lease cash requirements have not changed materially since September 30, 2023, and are disclosed within Note 6, Leases, included elsewhere in this Quarterly Report on Form 10-Q/A.
The following table summarizes our current and long-term material cash requirements as of June 29, 2024 for our vendor commitments:
Payments due in:
Total
Less than 1 Year
1-3 Years
3-5 Years
More than 5 Years
(in thousands)
Vendor commitments
$
1,335,198
$
1,234,193
$
101,005
$
—
$
—
Our future capital requirements will depend on many factors, including our growth rate, the timing and extent of spending to support research and development efforts, the expansion of sales and marketing activities, the introduction of new and enhanced product and service offerings, and the cost of any future acquisitions of technology or businesses. In the event that additional financing is required from outside sources, we may be unable to raise the funds on acceptable terms, if at all.
There have been no significant changes in our critical accounting policies and estimates during the nine months ended June 29, 2024, as compared to the critical accounting policies and estimates disclosed in the audited consolidated financial statements and related notes thereto as of and for the year ended September 30, 2023, which are included within the Annual Report on Form 10-K filed with the SEC on December 11, 2023.
Off-Balance Sheet Arrangements
As of June 29, 2024, we had no off-balance sheet arrangements as defined in Instruction 8 to Item 303(b) of Regulation S-K.
Recent Accounting Pronouncements
For information on recent accounting pronouncements, see Recently Issued Accounting Pronouncements and Recently Adopted Accounting Pronouncements in the notes to the unaudited condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q/A.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes in our assessment of our sensitivity to market risk since our presentation set forth in Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in the Annual Report on Form 10-K filed with the SEC on December 11, 2023.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively), has evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q/A. The term “disclosure controls and procedures,” as defined in the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of June 29, 2024, our disclosure controls and procedures were not effective at the reasonable assurance level because of the existence of the material weaknesses described below. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company's annual or interim consolidated financial statements will not be prevented or detected on a timely basis.
As of June 29, 2024, the Company did not effectively design procedures and controls over the timing of the recognition of cost of revenue. This resulted in the acceleration of the recognition of cost of revenue. Given that we recognize revenue on a percentage of completion basis, this resulted in the acceleration of recognition of revenue. Additionally, the Company did not effectively design and execute controls over revenue recognition related to cost overruns on certain deployments that will not be billable. This resulted in an overstatement of revenue during the year. These deficiencies in internal control over financial reporting constituted material weaknesses as of June 29, 2024.
Notwithstanding the material weaknesses in internal control over financial reporting, our management, including our Chief Executive Officer and Chief Financial Officer, have concluded that our consolidated financial statements present fairly, in all material respects, our financial position, results of our operations and our cash flows for the periods presented in this Quarterly Report on Form 10-Q/A, in conformity with U.S. GAAP. There can be no assurance that these material weaknesses will not result in a misstatement to the annual or interim consolidated financial statements for future periods that would not be prevented or detected.
Changes in Internal Control Over Financial Reporting
Subject to the matters set forth below under Material Weakness Remediation Plan, there have been no changes in our internal control over financial reporting for the three months ended June 29, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Material Weakness Remediation Plan
Management has developed a remediation plan, which it began implementing as of the end of fiscal year 2024, that includes the following elements:
•Augmented compensating controls over the receipt of goods and services, with a focus on milestone related expenses;
•Implemented ERP system enhancements for goods and services receipts and enhanced documentation requirements for milestone related expenses;
•Training of the employees and redesign of the structure of the organization receiving goods and services; and
•Implemented compensating controls over revenue recognition for non-billable cost overruns.
Management is committed to the completion of the remediation of these material weaknesses and expects to successfully implement enhanced control processes. Management has also engaged third-party consultants to evaluate and help simplify business processes around the receipts of goods and services. However, as management continues to evaluate and work to improve its internal control over financial reporting, it may determine that additional measures to address control deficiencies or modifications to the remediation plan are necessary. Therefore, management cannot assure you when these material weaknesses will be remediated, that additional actions will not be required to remediate these material weaknesses, or the costs of any such additional actions. These material weaknesses will not be considered remediated until the remediated controls operate for a sufficient period of time and management has concluded, through further testing, that these controls are operating effectively.
ERP System Implementation
The Company has completed its new enterprise resource planning (“ERP”) system implementation, SAP’s S4/HANA which is expected to improve the efficiency of certain financial and related business processes. The implementation of SAP’s S4/HANA is expected to strengthen the financial controls by automating certain manual processes and standardizing business processes and reporting across the organization. We will continue to evaluate and monitor the internal controls over financial reporting during this period of change and will continue to evaluate the operating effectiveness of related key controls. For a discussion of risks related to the implementation of new systems, please see the section in our Quarterly Report on Form 10-Q filed with the SEC on February 8, 2024 titled “Risk Factors.”
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
We may be subject from time to time to various claims, lawsuits, and other legal and administrative proceedings arising in the ordinary course of business. Some of these claims, lawsuits, and other proceedings may involve highly complex issues that are subject to substantial uncertainties, and could result in damages, fines, and penalties, non-monetary sanctions, or relief. We intend to recognize provisions for claims or pending litigation when we determine that an unfavorable outcome is probable, and the amount of loss can be reasonably estimated. Due to the inherent uncertain nature of litigation, the ultimate outcome or actual cost of settlement may materially vary from estimates.
Item 1A. Risk Factors
We are subject to various risks and uncertainties in the course of our business. For a detailed discussion of these risks, please see the section in our Annual Report on Form 10-K filed with the SEC on December 11, 2023 titled “Risk Factors”. Any of the matters highlighted in those risk factors and the risk factor below could adversely affect our business, results of operation and financial condition.
We are required to assess our internal control over financial reporting and our management has identified material weaknesses. If our remediation of the material weaknesses is not effective, or we identify additional material weaknesses or other adverse findings in the future, our ability to report our financial condition or results of operations accurately or timely or prevent fraud may be adversely affected, which may result in a loss of investor confidence in our financial
reports, significant expenses to remediate any internal control deficiencies, and ultimately have an adverse effect on the trading price of our common stock.
Effective internal controls over financial reporting are necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations. Pursuant to Section 404 of the Sarbanes-Oxley Act, or Section 404, we are required to furnish a report by our management on our internal control over financial reporting. As we are no longer an “emerging growth company” as of the end of the fiscal year ended September 28, 2024, to achieve compliance with Section 404, we are required to document and test the operating effectiveness of our internal control over financial reporting, which is both costly and challenging. The rules governing the standards that must be met for management to assess our internal control over financial reporting are complex and require significant documentation, testing and possible remediation. Annually, we perform activities that include reviewing, documenting and testing our internal control over financial reporting. In addition, if we fail to maintain the adequacy of our internal control over financial reporting, we will not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002. If we fail to achieve and maintain an effective internal control environment, we could suffer misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information. This could result in significant expenses to remediate any internal control deficiencies and lead to a decline in our stock price.
Our management has conducted an evaluation of the effectiveness of our internal control over financial reporting as of June 29, 2024. Based upon this evaluation and those criteria, management concluded that, as of June 29, 2024, the Company’s internal control over financial reporting was not effective due to the identification of material weaknesses. As of June 29, 2024, the Company did not effectively design procedures and controls over the timing of the recognition of cost of revenue. This resulted in the acceleration of the recognition of cost of revenue. Given that we recognize revenue on a percentage of completion basis, this resulted in the acceleration of recognition of revenue. Additionally, the Company did not effectively design and execute controls over revenue recognition related to cost overruns on certain deployments that will not be billable. This resulted in an overstatement of revenue during the year. These deficiencies in internal control over financial reporting constituted material weaknesses. For further discussion of these material weaknesses, see Part I, Item 4. Controls and Procedures. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis.
We may be unable to conclude in future periods that our disclosure controls and procedures are effective due to the effects of various factors, which may, in part, include unremediated material weaknesses in internal controls over financial reporting. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in those reports is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.
Management is committed to maintaining a strong internal control environment and believes its remediation efforts will represent an improvement in existing controls. Management anticipates that the new controls, as implemented and when tested for a sufficient period of time, will remediate the material weaknesses. We may not be successful in promptly remediating the material weaknesses identified by management or be able to identify and remediate additional control deficiencies, including material weaknesses, in the future. Remediation efforts have placed, and will continue to place, a significant burden on management and add increased pressure on our financial reporting resources and processes. The accuracy of our financial reporting and our ability to timely file with the SEC may in the future be adversely impacted if we are unable to successfully remediate the material weaknesses in a timely manner, or if any additional material weaknesses in our internal control over financial reporting are identified.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
During the fiscal quarter ended June 29, 2024, no director or officer, as defined in Rule 16a-1(f) under the Exchange Act, adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as defined in Regulation S-K Item 408.
Certain of our directors or officers have made elections to participate in, and are participating in, our Incentive Compensation Plan, ESPP or our defined-contribution benefit plan under the provisions of Section 401(k) of the Internal Revenue Code and have may, and may from time to time make, elections to have shares withheld to cover withholding taxes or pay the exercise price of options, which may be designed to satisfy the affirmative defense conditions of Rule 10b5-1 under the Exchange Act or may constitute non-Rule 10b5–1 trading arrangements (as defined in Item 408(c) of Regulation S-K).
Item 6. Exhibits
The exhibits listed below are filed or incorporated by reference into this Report.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Date: December 4, 2024
Symbotic Inc.
By:
/s/ Maria G. Freve
Name:
Maria G. Freve
Title:
Vice President, Controller and Chief Accounting Officer (Principal Accounting Officer)