Eargo, Inc.

CIK:0001719395|SEC Filings

Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement [Abstract]
Revenue, net	$ 8,270	$ 7,908	$ 28,191	$ 24,331
Cost of revenue	3,937	6,007	17,105	16,231
Gross profit	4,333	1,901	11,086	8,100
Operating expenses:
Research and development	4,742	4,963	14,711	14,689
Sales and marketing	9,281	11,282	35,309	37,306
General and administrative	7,385	11,702	26,739	43,980
Impairment charge	873	0	873	0
Total operating expenses	22,281	27,947	77,632	95,975
Loss from operations	(17,948)	(26,046)	(66,546)	(87,875)
Other income (expense), net:
Interest income	620	419	2,144	480
Interest expense				(549)
Change in fair value of convertible notes		(25,000)		(25,000)
Loss on extinguishment of debt				(772)
Total other income (expense), net	620	(24,581)	2,144	(25,841)
Loss before income taxes	(17,328)	(50,627)	(64,402)	(113,716)
Net loss and comprehensive loss	(17,328)	(50,627)	(64,402)	(113,716)
Net loss attributable to common stockholders, basic and diluted	$ (17,328)	$ (50,627)	$ (64,402)	$ (113,716)
Net loss per share attributable to common stockholders, basic	$ (0.83)	$ (25.7)	$ (3.1)	$ (57.78)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic	20,756,123	1,969,856	20,745,534	1,968,074
Net loss per share attributable to common stockholders, diluted	$ (0.83)	$ (25.7)	$ (3.1)	$ (57.78)
Weighted-average shares used in computing net loss per share attributable to common stockholders, diluted	20,756,123	1,969,856	20,745,534	1,968,074

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Operating activities:
Net loss	$ (64,402)	$ (113,716)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	3,477	4,023
Stock-based compensation	8,677	7,592
Non-cash interest expense and amortization of debt discount		209
Debt issuance costs from convertible notes		5,662
Change in fair value of convertible notes		25,000
Loss on extinguishment of debt		772
Non-cash operating lease expense	734	828
Bad debt expense	409	524
Impairment charge	1,702	0
Changes in operating assets and liabilities:
Accounts receivable	489	10,867
Inventories	650	759
Prepaid expenses and other current assets	2,323	6,869
Other assets	(1,292)	999
Accounts payable	(1,152)	(2,366)
Accrued expenses	(5,897)	1,986
Sales returns reserve	(175)	(12,037)
Settlement liability		(34,372)
Other current and noncurrent liabilities	(124)	89
Operating lease liabilities	(346)	(550)
Net cash used in operating activities	(54,927)	(96,862)
Investing activities:
Purchases of property and equipment	(217)	(2,531)
Capitalized software development costs	(71)	(296)
Net cash used in investing activities	(288)	(2,827)
Financing activities:
Proceeds from stock options exercised		134
Debt repayments		(16,238)
Proceeds from issuance of convertible notes, net of issuance costs paid to lender		99,903
Payment of convertible notes issuance costs to third parties		(5,565)
Payment of deferred transaction costs		(872)
Payment of taxes related to net share settlement of restricted stock units		(29)
Restricted stock units settled in cash		(69)
Net cash provided by financing activities		77,264
Net decrease in cash and cash equivalents	(55,215)	(22,425)
Cash and cash equivalents at beginning of period	101,238	110,500
Cash and cash equivalents at end of period	46,023	88,075
Non-cash operating activities:
Lease liability obtained in exchange for right-of-use asset	1,399
Non-cash investing and financing activities:
Property and equipment and capitalized software costs in accounts payable and accrued liabilities	$ 642	229
Deferred transaction costs included in accounts payable		$ 182

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 46,023	$ 101,238
Accounts receivable, net	1,012	1,910
Inventories	4,386	5,036
Prepaid expenses and other current assets	5,271	7,846
Total current assets	56,692	116,030
Operating lease right-of-use assets	7,327	5,765
Property and equipment, net	4,384	7,441
Intangible assets, net	744	1,063
Goodwill		873
Other assets	606	906
Total assets	69,753	132,078
Current liabilities:
Accounts payable	5,047	6,504
Accrued expenses	6,818	12,715
Sales returns reserve	3,767	3,942
Other current liabilities	1,338	1,462
Lease liability, current portion	624	628
Total current liabilities	17,594	25,251
Lease liability, noncurrent portion	7,030	5,973
Total liabilities	24,624	31,224
Commitments and contingencies (Note 5)
Stockholders' equity:
Common stock; $0.0001 par value; 450,000,000 shares authorized as of September 30, 2023 and December 31, 2022, respectively; 20,762,389 and 20,726,965 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively	2	2
Additional paid-in capital	623,828	615,151
Accumulated deficit	(578,701)	(514,299)
Total stockholders' equity	45,129	100,854
Total liabilities and stockholders' equity	$ 69,753	$ 132,078