Oblong, Inc. (NASDAQ:OBLG) Q3 2022 Earnings Conference Call November 10, 2022 4:30 PM ET
Peter Holst - President and CEO
David Clark - CFO
Hosting the call today are Oblong's President and CEO, Peter Holst; and CFO, David Clark. Please be aware, some of the comments made during today's call may contain forward-looking statements within the meanings of the federal securities laws. Statements about our beliefs and expectations containing words such as may, could, would, will, should, believe, expect, anticipate and similar expressions constitute forward-looking statements.
These statements involve risks and uncertainties regarding our operations and our future results could cause actual results to differ materially from management's current expectations. In addition, today's call includes non-GAAP financial measures. A reconciliation of such measures to GAAP measures is contained in the press release issued today. We encourage you to review the safe harbor statement and risk factors contained in the company's earnings release and filings with the SEC, including, without limitation, our most recent annual report on Form 10-K and other periodic reports that identify specific risk factors that may also cause actual results or events to differ materially from those described in the forward-looking statements.
Copies of the company's most recent reports on Form 10-K and 10-Q may be obtained on the company's website, oblong.com; or the SEC website, sec.gov. The company does not undertake to publicly update or revise any forward-looking statements after the call or date of this call. I would also like to remind everyone that this call will be available for replay through November 24. A link to the website replay of the call is also provided in the earnings release and is available on the company's website, oblong.com.
I will now turn the call over to the CEO of Oblong, Pete Holst.
Thanks, Dave. Good afternoon, everyone, and thank you for joining us today. In our third quarter, we continue to be impacted by a challenging and complex macro environment that specifically impacts workplaces and IT buying behavior. While some of the workforce has definitely returned to office environments post Labor Day, a substantial amount of our target market remains very much in a state of hybrid work, continually assessing the use of commercial office space and, in particular, how to best optimize collaboration spaces going forward.
As we stated on our most recent call, the team remains focused on 3 key areas. We're continuing to evaluate potential business combinations or the outright sale of the company. During the past few quarters, the team has and will continue to evaluate inorganic paths to growth. While recent volatility in the capital markets has tempered the appetite for M&A since late summer, we do believe current market conditions may actually expand our deal flow over the coming quarters while also allowing us to revisit opportunities otherwise deferred as valuations reset in the months ahead. I will say we've seen some more interesting opportunities in the last 30 to 45 days and we're actively pursuing those.
The second is optimizing our product mix for both our channel partners and our end customers. As we mentioned in prior calls, our products tend to be purchased and used by early adopters and visionaries looking to amplify engagement in medium- to large-sized collaboration spaces.
Our discussions with distribution partners and end users throughout the last few quarters suggest there is a larger redesign effort moving gradually across commercial office space, but a renewed focus on workforce size and optimization in recent months has delayed reconstruction efforts across many of our current and prospective customers. And lastly, with respect to operational discipline and particularly within our target segment, layoffs have accelerated in recent weeks with many of our customers as growth has slowed. As our current and prospective customers reset their business models, we have continued to take steps to extend our liquidity through the first half of '23 to ensure we can pursue both traditional and inorganic paths to growth when the market conditions improve.
I'll now turn the call over to David to summarize our results in Q3.
Thanks, Pete. Our revenue for the third quarter of 2022 was $1.2 million compared to $1.8 million for the third quarter of last year. The decrease in revenue is primarily attributable to the effects of the COVID-19 pandemic on our existing and target customers as they continue to evaluate behavioral changes in how and when employees choose to work from traditional office environments.
Net loss for the third quarter of 2022 was $7.2 million compared to a net loss of $0.7 million for the third quarter of 2021. Net loss for the third quarter of this year included noncash impairment charges on intangible and other assets of $5.2 million. Our adjusted EBITDA loss was $1.4 million in the third quarter of 2022, an improvement as compared to an adjusted EBITDA loss of $1.7 million for the same period last year. This was driven by a reduction in operating expenses between these periods. Also, we reduced our cash used in operations for the first 3 quarters of 2022 by $1.1 million as compared to the same period last year.
Turning to our balance sheet. At the end of the third quarter of 2022, we had total cash of $4.1 million, 0 debt and working capital of $4 million. Based on our current projections, we believe we have liquidity through the first half of 2023.
I will now turn the call back over to Pete.
Thanks, Dave. In closing, I wanted to thank all of our Oblong teammates and employees who make a concerted effort every day to work through some of these more trying times. I want to thank our customers and partners in particular, who have worked with us over the last year during a pretty big period of transition and who are helping us sort of frame the future for collaboration as it relates to Oblong. We've done these calls mostly as update calls recently, and we'll continue to do so for the near future.
And we really appreciate everyone who's continuing to participate in them and look forward to providing additional updates in the weeks and the months ahead. Thanks very much, everyone.
This concludes today's call. As previously stated, a link to the website replay of the call is also provided in the earnings release and available on the company's website, oblong.com.