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Investments

1

Portfolio Exits

1

About David Katzman

Detroit-based angel investor

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Latest David Katzman News

SmileDirectClub plummets 24% after missing quarterly estimates and reining in expansion plans

Feb 26, 2020

SmileDirectClub plummets 24% after missing quarterly estimates and reining in expansion plans By caption David Katzman, CEO of SmileDirectClub stands with founders Jordan Katzman (R) and Alex Fenkell as the company debuts its IPO at the Nasdaq MarketSite in New York source Reuters SmileDirectClub missed Wall Street’s expectations for fourth-quarter losses and revenue on Tuesday, citing back-office expenses and inefficient manufacturing operations. The company will shift focus to “controlled growth” in 2020 to reach profitability by the fourth quarter, CEO David Katzman said. SmileDirectClub stock slumped as much as 24% in early Wednesday trading. SmileDirectClub announced fiscal fourth-quarter earnings on Tuesday that landed below analyst expectations and drove outsized selling Wednesday morning. The company missed Wall Street estimates for revenue and losses per share in the quarter ended December 31. SmileDirectClub’s projection for full-year revenue in 2020 landed just below analysts’ estimates. The firm, which went public on September 3, will focus on “controlling growth” as it aims for profitability in 2020, CEO David Katzman said in the Tuesday report. SmileDirectClub shares tanked as much as 24% in early Wednesday trading, wiping out nearly all of its year-to-date gains. Here are the key numbers: Revenue: $197 million, versus the $199.9 million estimate Loss per share: 25 cents, versus the 11 cents estimate 2020 revenue guidance: $1 billion to $1.1 billion, versus the $1.14 billion estimate 2020 adjusted earnings loss: $50 million to $75 million “I think it’s important to keep things in perspective. We grew to a $750 million company with approximately 6,300 team members across seven countries in just a few short years,” Katzman said in a call with analysts. “That being said, we own these results, we understand why we missed our profitability goals in the quarter, and we have plans in place to address it.” Katzman attributed the end-of-year losses to higher expenses within its back-office process and inefficient production operations. Shipping delays also caused a “broad impact on customer experience,” the chief executive said. The company will work to boost demand within its existing network instead of push rapid expansion, according to the quarterly report. SmileDirectClub expects to reach profitability by the fourth quarter of 2020. SmileDirectClub closed at $11.33 per share on Tuesday, up 38% year-to-date. The company has eight “buy” ratings, two “hold” ratings, and one “sell” rating from analysts, with a consensus price target of $14.10, according to Bloomberg data. Now read more markets coverage from Markets Insider and Business Insider:

David Katzman Investments

1 Investments

David Katzman has made 1 investments. Their latest investment was in HelloWorld as part of their Unattributed VC on January 1, 2006.

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David Katzman Investments Activity

investments chart

Date

Round

Company

Amount

New?

Co-Investors

Sources

1/31/2006

Unattributed VC

HelloWorld

$32M

Yes

1

Date

1/31/2006

Round

Unattributed VC

Company

HelloWorld

Amount

$32M

New?

Yes

Co-Investors

Sources

1

David Katzman Portfolio Exits

1 Portfolio Exit

David Katzman has 1 portfolio exit. Their latest portfolio exit was HelloWorld on August 22, 2012.

Date

Exit

Companies

Valuation
Valuations are submitted by companies, mined from state filings or news, provided by VentureSource, or based on a comparables valuation model.

Acquirer

Sources

8/22/2012

Acq - Fin - II

$99M

1

Date

8/22/2012

Exit

Acq - Fin - II

Companies

Valuation

$99M

Acquirer

Sources

1

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