Symbotic Inc
For the period ended Mar 30, 2024. Filed May 7, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 30, 2024 · Filed May 7, 2024
SYM$36.82+5.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2023-12-30; filed 2024-02-08.
0001837240-24-000039
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-03-30; filed 2024-05-07.
0001837240-24-000111
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 86 previous paragraphs and 105 current paragraphs.
57 unchanged; 28 reworded; 12 added; 0 removed; 1 previous and 8 current paragraphs rearranged.
Tables are not compared: 15 previous and 23 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (12)
Current report
The key metrics which describe our System from commencement to completion are as follows: (1) Start occurs when a Statement of Work (“SOW”) is signed with a customer; (2) Deployment is defined as the period of time following the signed SOW until acceptance is achieved on the System; (3) Operational describes a System which has achieved acceptance. The majority of Systems revenue occurs during the deployment stage, and once a system reaches acceptance, software maintenance and support begins.
Current report
The increase in software maintenance and support revenue is due to there being nine additional sites operational and under software maintenance and support contracts for the six months ended March 30, 2024 as compared to the six months ended March 25, 2023.
Current report
Systems gross profit decreased $2.0 million during the three months ended March 30, 2024 as compared to the three months ended March 25, 2023. During the three months ended ended March 30, 2024, we completed our restructuring related to outsource of bot assembly and component inventory management, including standardizing on Symbot as our go-ahead bot platform. As a result, we recognized a restructuring charge in the second quarter of fiscal year 2024 which contributed to the decrease in Systems gross profit.
Current report
Systems gross profit increased $30.8 million during the six months ended March 30, 2024 as compared to the six months ended March 25, 2023. The increase in systems gross profit was partially driven by the increased number of sites in deployment in fiscal year 2024 as compared to fiscal year 2023. This increase was offset by the completion of our restructuring related to outsource of bot assembly and component inventory management, including standardizing on Symbot as our go-ahead bot platform. As a result of this, we recognized a restructuring charge in the second quarter of fiscal year 2024.
Current report
Prototyping-related costs, allocated overhead expenses, and other expenses remained relatively flat for the three months ended March 30, 2024 as compared to the three months ended March 25, 2023 though we did experience less expense related to prototyping-related costs resulting from outsourcing of prototyping-related work to third party vendors.
Current report
The decrease in research and development expenses for the six months ended March 30, 2024 as compared to the six months ended March 25, 2023 is due to the following:
Current report
The decrease in selling, general, and administrative expenses for the six months ended March 30, 2024 as compared to the six months ended March 25, 2023 is due to the following:
Current report
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 six months ended March 25, 2023 due to the expense recognized in the first half 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.
Current report
The income tax benefit recorded for the six months ended March 30, 2024 as compared to the income tax expense recorded for the six months ended March 25, 2023 is attributable to the expense related to our state income taxes.
Current report
•Restructuring charges – Restructuring charges represent the charges incurred 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 programs. 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.
Current report
•Equity financing transaction costs – Equity financing transaction costs represents the costs incurred, including for legal, professional fees for accountants, transaction fees, advisory fees, due diligence costs, and certain other professional fees that are directly related to an equity financing transaction.
Current report
During the six months ended March 25, 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.
Reworded paragraphs (28)
Previous wording
Operation services: We provide our customers with assistance operating the system and ensuring user experience is optimized for efficiency and effectiveness. 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.
Current wording
Operation services: We provide our customers with assistance operating the system and ensuring user experience is optimized for efficiency and effectiveness. 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.
Previous wording
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 is expensed as incurred.
Current wording
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.
Previous wording
Results of Operations for the Three Months Ended December 30, 2023 and December 24, 2022
Current wording
Results of Operations for the Three and Six Months Ended March 30, 2024 and March 25, 2023
Previous wording
Three Months Ended December 30, 2023 Compared to the Three Months Ended December 24, 2022
Current wording
Three and Six Months Ended March 30, 2024 Compared to the Three and Six Months Ended March 25, 2023
Previous wording
Systems revenue increased during the three months ended December 30, 2023 as compared to the three months ended December 24, 2022 due to there being 37 system deployments in progress during the fiscal quarter ending December 30, 2023 as compared to 22 system deployments in progress in the same quarter of fiscal 2022. The increase resulting from the deployments of our warehouse automation system is primarily due to the ongoing Master Automation Agreement with Walmart, for which we are performing the installation and implementation of our warehouse automation system within all of Walmart’s 42 regional distribution centers, and which is expected to continue to produce systems revenue as the warehouse automation systems are installed and implemented at the remaining regional distribution centers through fiscal year 2028.
Current wording
Systems revenue increased during the three months ended March 30, 2024 as compared to the three months ended March 25, 2023 due to there being 37 system deployments in progress during the fiscal quarter ending March 30, 2024 as compared to 28 system deployments in progress in the same quarter of fiscal 2023. The increase resulting from the deployments of our warehouse automation system is primarily due to the ongoing Master Automation Agreement with Walmart, for which we are performing the installation and implementation of our warehouse automation system within all of Walmart’s 42 regional distribution centers, and which is expected to continue to produce systems revenue as the warehouse automation systems are installed and implemented at the remaining regional distribution centers through fiscal year 2028.
Previous wording
The increase in software maintenance and support revenue is due to there being four additional sites under software maintenance and support contracts contributing to our software maintenance and support revenue balance for the three months ended December 30, 2023 as compared to the three months ended December 24, 2022.
Current wording
The increase in software maintenance and support revenue is due to there being nine additional sites operational and under software maintenance and support contracts for the three months ended March 30, 2024 as compared to the three months ended March 25, 2023.
Previous wording
The increase in operation services revenue is attributable to an increase in sites where we are performing operation services during the three months ended December 30, 2023 as compared to the three months ended December 24, 2022 due to an increased number of systems in deployment during the period as compared to the prior year.
Current wording
The increase in operation services revenue is attributable to an increase in sites where we are performing operation services during the three months ended March 30, 2024 as compared to the three months ended March 25, 2023 due to an increased number of systems in deployment during the period as compared to the prior year as well as an increase in spare parts sales to our customers during the three months ended March 30, 2024 as compared to the three months ended March 25, 2023.
Previous wording
The increase in operation services gross profit is driven by an increase to the number of sites where we are performing operation services and efficiency improvement on our existing operation services sites.
Current wording
The increase in operation services gross profit is driven by an increase to the number of sites where we are performing operation services, efficiency improvement on our existing operation services sites, and profit generated from the sales of spare parts.
Previous wording
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 December 24, 2022 due to the expense recognized in the first 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.
Current wording
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 March 25, 2023 due to the expense recognized in the second 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.
Previous wording
The increase in prototype-related costs, allocated overhead expenses, and other during the three months ended December 30, 2023 as compared to the three months ended December 24, 2022 is primarily due to an increase in prototype expenses as we implement efforts to expand on our current product offerings.
Current wording
The increase in prototyping-related costs, allocated overhead expenses, and other during the six months ended March 30, 2024 as compared to the six months ended March 25, 2023 is partially attributable to an increase in prototyping-related expenses incurred by us in the first quarter of fiscal year 2024 as we are implementing efforts to expand on our current product offerings. There was additionally 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 six months ended March 30, 2024.
Previous wording
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 December 24, 2022 due to the expense recognized in the first 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 travel-related expenses incurred by our employees as our business continues to grow.
Current wording
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 March 25, 2023 due to the expense recognized in the second 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.
Previous wording
The increase in other income, net for the three months ended December 30, 2023 as compared to the three months ended December 24, 2022 was due to higher interest earned on invested cash balances and marketable securities as a result of increased interest rates.
Current wording
The increase in other income, net for the three months ended March 30, 2024 as compared to the three months ended March 25, 2023 was due to higher interest earned on invested cash balances and marketable securities as a result of increased interest rates from the prior year as well as a higher cash balance at March 30, 2024 as compared to March 25, 2023.
Previous wording
The decrease in income tax expense for the three months ended December 30, 2023 as compared to the three months ended December 24, 2022 is attributable to an increase in our international tax expense, offset by a decrease in the expense related to our state income taxes.
Current wording
The increase in income tax benefit for the three months ended March 30, 2024 as compared to the three months ended March 25, 2023 is attributable to the expense related to our state income taxes.
Previous wording
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; and other infrequent items that may arise from time to time.
Current wording
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; and other infrequent items that may arise from time to time.
Previous wording
•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.
Current wording
•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.
Previous wording
The following table reconciles GAAP net loss to Adjusted EBITDA for the three months ended December 30, 2023 and December 24, 2022 (in thousands):
Current wording
The following table reconciles GAAP net loss to Adjusted EBITDA for the three and six months ended March 30, 2024 and March 25, 2023 (in thousands):
Previous wording
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 and stock-based compensation expense. 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):
Current wording
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):
Previous wording
As of December 30, 2023, our principal sources of liquidity were cash received upon exercise of warrants, proceeds received from the maturities of marketable securities, and cash received from customers upon the inception and continuation of contracts to install customer Systems.
Current wording
As of March 30, 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 customer Systems.
Previous wording
The following table shows net cash provided by (used in) operating activities, net cash provided by (used in) investing activities, and net cash provided by financing activities for the three months ended December 30, 2023 and December 24, 2022:
Current wording
The following table shows net cash provided by (used in) operating activities, net cash provided by (used in) investing activities, and net cash provided by (used in) financing activities for the six months ended March 30, 2024 and March 25, 2023:
Previous wording
Our net cash provided by (used in) operating activities consists of net loss adjusted for certain non-cash items, including depreciation and amortization, foreign currency 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 system installations 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.
Current wording
Our net cash provided by (used in) 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 system installations 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.
Previous wording
Net cash used in operating activities was $(30.2) million during the three months ended December 30, 2023. Net cash used in operating activities was primarily due to our net loss of $13.0 million adjusted for non-cash items of $32.8 million, primarily consisting of $3.2 million depreciation and amortization and $29.5 million stock-based compensation, in addition to cash used in operating assets and liabilities of $49.9 million. Cash used in operating assets and liabilities of $49.9 million was primarily driven by net working capital changes, including the timing of cash payments to vendors and cash receipts from customers.
Current wording
Net cash used in operating activities was $9.1 million during the six months ended March 30, 2024. Net cash used in operating activities was primarily due to our net loss of $53.9 million adjusted for non-cash items of $89.4 million, primarily consisting of $6.4 million depreciation and amortization, $57.5 million stock-based compensation, and $34.3 million provision for excess and obsolete inventory, in addition to cash used in operating assets and liabilities of $44.6 million. Cash used in operating assets and liabilities of $44.6 million was primarily driven by net working capital changes, including the timing of cash payments to vendors and cash receipts from customers.
Previous wording
Net cash provided by operating activities was $101.1 million during the three months ended December 24, 2022. Net cash provided by operating activities was primarily due to our net loss of $68.0 million adjusted for non-cash items of $51.6 million, primarily consisting of $2.1 million depreciation and amortization and $49.5 million stock-based compensation, offset by cash provided by operating assets and liabilities of $117.4 million. Cash provided by operating assets and liabilities of $117.4 million was primarily driven by net working capital changes, including timing of cash payments to vendors and cash receipts from customers, an increase in inventory purchases for the three months ended December 24, 2022 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 three months ended December 24, 2022 resulting from an increase in the number of active system installation projects.
Current wording
Net cash provided by operating activities was $132.4 million during the six months ended March 25, 2023. Net cash provided by operating activities was primarily due to our net loss of $123.4 million adjusted for non-cash items of $95.2 million, primarily consisting of $4.1 million depreciation and amortization, $6.2 million provision for excess and obsolete inventory, and $84.8 million stock-based compensation, offset by cash provided by operating assets and liabilities of $160.6 million. Cash provided by operating assets and liabilities of $160.6 million was primarily driven by net working capital changes, including timing of cash payments to vendors and cash receipts from customers, an increase in inventory purchases for the six months ended March 25, 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 six months ended March 25, 2023 resulting from an increase in the number of active system installation projects.
Previous wording
Net cash and cash equivalents provided by investing activities during the three months ended December 30, 2023 is primarily driven by $150.0 million in proceeds upon the maturity of certain U.S. Treasury securities, offset by purchases of U.S. Treasury securities of $48.3 million and purchases of property and equipment of $2.2 million.
Current wording
Net cash and cash equivalents provided by investing activities during the six months ended March 30, 2024 is primarily driven by $290.0 million in proceeds upon the maturity of certain U.S. Treasury securities, offset by purchases of U.S. Treasury securities of $48.7 million.
Previous wording
Net cash and cash equivalents used in investing activities during the three months ended December 24, 2022 consisted of $7.0 million of purchased property and equipment. Additionally, during the three months ended December 24, 2022, we purchased U.S. Treasury securities for $96.8 million.
Current wording
Net cash and cash equivalents used in investing activities during the six months ended March 25, 2023 consisted of $13.0 million of purchased property and equipment. Additionally, during the six months ended March 25, 2023, we purchased U.S. Treasury securities for $203.1 million.
Previous wording
Our financing activities typically consist of payments and proceeds related to our equity incentive plans for both RSUs and ESPP, and also include proceeds from the exercise of the vested warrants issued to Walmart.
Current wording
Our financing activities typically consist of payments and proceeds related to our equity incentive plans for both RSUs and ESPP, and also include proceeds from the exercise of the vested warrants issued to Walmart as well as proceeds from equity financing transactions.
Previous wording
During the three months ended December 30, 2023, we received cash of $158.7 million upon the gross exercise of Walmart’s vested warrant units, which occurred in December 2023. No other significant financing activities occurred during the three months ended December 30, 2023. There were no transactions during the three months ended December 24, 2022 in which we generated proceeds from or used cash in financing activities.
Current wording
During the six months ended March 30, 2024, we received cash of $158.7 million upon the gross exercise of Walmart’s 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 transaction in March 2024. No other significant financing activities occurred during the six months ended March 30, 2024.
Previous wording
Our cash flows from operations along with equity infusions have historically been sufficient to fund our operating activities and other cash requirements. As of December 30, 2023, we have a cash and cash equivalents balance of $486.0 million and short-term available for sale marketable securities balance of $189.0 million. Our cash requirements for the three months ended December 30, 2023 were primarily related to inventory purchases in order to deliver to our customers our warehouse automation systems in an orderly manner in line with our installation timeline, purchases of marketable securities in order to diversify the composition of our cash balance, and capital expenditures.
Current wording
Our cash flows from operations along with equity infusions have historically been sufficient to fund our operating activities and other cash requirements. As of March 30, 2024, we have a cash and cash equivalents balance of $901.4 million and short-term available for sale marketable securities balance of $50.0 million. Our cash requirements for the six months ended March 30, 2024 were primarily related to inventory purchases in order to deliver to our customers our warehouse automation systems in an orderly manner in line with our installation timeline, purchases of marketable securities in order to diversify the composition of our cash balance, and capital expenditures.
Previous wording
There have been no significant changes in our critical accounting policies and estimates during the three months ended December 30, 2023 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.
Current wording
There have been no significant changes in our critical accounting policies and estimates during the six months ended March 30, 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.
Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
Systems revenue increased during the six months ended March 30, 2024 as compared to the six months ended March 25, 2023 due to there being 37 system deployments in progress during the fiscal quarter ending March 30, 2024 as compared to 28 system deployments in progress in the same quarter of fiscal 2023. The increase resulting from the deployments of our warehouse automation system is primarily due to the ongoing Master Automation Agreement with Walmart, for which we are performing the installation and implementation of our warehouse automation system within all of Walmart’s 42 regional distribution centers, and which is expected to continue to produce systems revenue as the warehouse automation systems are installed and implemented at the remaining regional distribution centers through fiscal year 2028.
Current report — wording carried from elsewhere
The increase in operation services revenue is attributable to an increase in sites where we are performing operation services during the six months ended March 30, 2024 as compared to the six months ended March 25, 2023 due to an increased number of systems in deployment during the period as compared to the prior year as well as an increase in spare parts sales to our customers during the six months ended March 30, 2024 as compared to the six months ended March 25, 2023.
Current report — wording carried from elsewhere
The following table sets forth our gross profit for the six months ended March 30, 2024 and March 25, 2023:
Current report — wording carried from elsewhere
The increase in software maintenance and support gross profit is due to an increase in revenues for the six months ended March 30, 2024 while costs to perform our maintenance and support services remained relatively flat.
Current report — wording carried from elsewhere
The increase in operation services gross profit is driven by an increase to the number of sites where we are performing operation services and efficiency improvement on our existing operation services sites and profit generated from the sales of spare parts.
Current report — wording carried from elsewhere
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 six months ended March 25, 2023 due to the expense recognized in the first half 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.
Current report — wording carried from elsewhere
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.
Current report — wording carried from elsewhere
The increase in other income, net for the six months ended March 30, 2024 as compared to the six months ended March 25, 2023 was due to higher interest earned on invested cash balances and marketable securities as a result of increased interest rates from the prior year as well as a higher cash balance at March 30, 2024 as compared to March 25, 2023.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Systems gross profit increased $32.8 million during the three months ended December 30, 2023 as compared to the three months ended December 24, 2022 due to there being 37 system deployments in progress during the fiscal quarter ending December 30, 2023 as compared to 22 system deployments in progress in the same quarter of fiscal 2022.