##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2008
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the transition
period from  to
 Commission file number: 0-30907
 iGo, Inc.
 (Exact Name of Registrant as Specified in its Charter)
 Delaware
    
    86-0843914(State or Other Jurisdiction of Incorporation)
    
    (IRS Employer Identification No.)17800 N. Perimeter Dr., Suite 200, Scottsdale, Arizona
    
    85255(Address of Principal Executive Offices)
    
    (Zip Code)
 (480) 596-0061
(Registrants telephone number, including area code)
 Mobility Electronics, Inc.
(Former Name, Former Address, and Former Fiscal Year if Changed Since Last Report)
  þ o
  Large accelerated filer
o
    
    Accelerated filer
o
    
    Non-accelerated filer   o
(Do not check if a smaller reporting company)
    
    Smaller reporting company
þ
  o þ




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##### 



IGO, INC.
FORM 10-Q
 TABLE OF CONTENTS
 PAGE NO.PART I FINANCIAL INFORMATION
    
    
    1Item 1. Financial Statements:
    
    
    1Condensed Consolidated Balance Sheets
    
    
    1Condensed Consolidated Statements Of Operations
    
    
    2Condensed Consolidated Statements Of Cash Flows
    
    
    3Notes To Unaudited Condensed Consolidated Financial Statements
    
    
    4Item 2. Managements Discussion and Analysis Of Financial Condition and Results of Operations
    
    
    12Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    24PART II OTHER INFORMATION
    
    
    24Item 1. Legal Proceedings
    
    
    24Item 1A. Risk Factors
    
    
    25Item 4. Submission of Matters to a Vote Of Security Holders
    
    
    25Item 6. Exhibits
    
    
    25SIGNATURES
    
    
    26EXHIBIT INDEX
    
    
    27EX-31.1EX-31.2EX-32.1




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##### Table of Contents



PART I FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS:
 IGO, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In thousands)
 (unaudited)
 June 30,
    
    
    December 31,2008
    
    
    2007ASSETSCurrent assets:Cash and cash equivalents
    
    $
    21,461
    
    
    $
    15,908Short-term investments
    
    
    6,129
    
    
    
    9,026Accounts receivable, net
    
    
    14,015
    
    
    
    16,924Inventories
    
    
    4,678
    
    
    
    7,406Prepaid expenses and other current assets
    
    
    248
    
    
    
    446Total current assets
    
    
    46,531
    
    
    
    49,710Property and equipment, net
    
    
    1,274
    
    
    
    1,553Intangible assets, net
    
    
    1,813
    
    
    
    1,926Long-term investments
    
    
    570
    
    
    
    Notes receivable and other assets, net
    
    
    399
    
    
    
    961Total assets
    
    $
    50,587
    
    
    $
    54,150LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    9,312
    
    
    $
    11,694Accrued expenses and other current liabilities
    
    
    2,603
    
    
    
    3,680Deferred revenue
    
    
    262
    
    
    
    936Total current liabilities
    
    
    12,177
    
    
    
    16,310Minority interest
    
    
    384
    
    
    
    384Total liabilities
    
    
    12,561
    
    
    
    16,694Stockholders equity:Common stock
    
    
    319
    
    
    
    314Additional paid-in capital
    
    
    168,873
    
    
    
    168,010Accumulated deficit
    
    
    (131,391
    )
    
    
    (131,091
    )Accumulated other comprehensive income
    
    
    225
    
    
    
    223Total stockholders equity
    
    
    38,026
    
    
    
    37,456Total liabilities and stockholders equity
    
    $
    50,587
    
    
    $
    54,150
  1




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##### Table of Contents



IGO, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share amounts)
 (unaudited)
 Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Revenue
    
    $
    18,553
    
    
    $
    19,508
    
    
    $
    37,491
    
    
    $
    38,371Cost of revenue
    
    
    13,149
    
    
    
    17,389
    
    
    
    26,509
    
    
    
    30,846Gross profit
    
    
    5,404
    
    
    
    2,119
    
    
    
    10,982
    
    
    
    7,525Operating expenses:Sales and marketing
    
    
    2,247
    
    
    
    2,685
    
    
    
    4,261
    
    
    
    5,442Research and development
    
    
    910
    
    
    
    1,457
    
    
    
    1,703
    
    
    
    3,134General and administrative
    
    
    2,630
    
    
    
    4,744
    
    
    
    6,729
    
    
    
    8,330Total operating expenses
    
    
    5,787
    
    
    
    8,886
    
    
    
    12,693
    
    
    
    16,906Loss from operations
    
    
    (383
    )
    
    
    (6,767
    )
    
    
    (1,711
    )
    
    
    (9,381
    )Other income (expense):Interest income, net
    
    
    210
    
    
    
    289
    
    
    
    478
    
    
    
    556Gain on disposal of assets and other income, net
    
    
    107
    
    
    
    1,837
    
    
    
    261
    
    
    
    2,141Litigation settlement income
    
    
    
    
    
    
    
    
    
    
    672
    
    
    
    Loss before minority interest
    
    
    (66
    )
    
    
    (4,641
    )
    
    
    (300
    )
    
    
    (6,684
    )Minority interest
    
    
    
    
    
    
    (127
    )
    
    
    
    
    
    
    (127
    )Net loss
    
    $
    (66
    )
    
    $
    (4,768
    )
    
    $
    (300
    )
    
    $
    (6,811
    )Basic and diluted net loss per common share
    
    $
    (0.00
    )
    
    $
    (0.15
    )
    
    $
    (0.01
    )
    
    $
    (0.22
    )Basic and diluted weighted average common
shares outstanding
    
    
    31,772
    
    
    
    31,574
    
    
    
    31,676
    
    
    
    31,657
 2




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##### Table of Contents



IGO, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 (unaudited)
 Six Months EndedJune 30,2008
    
    
    2007Cash flows from operating activities:Net loss
    
    $
    (300
    )
    
    $
    (6,811
    )Adjustments to reconcile net loss to net cash provided by operating activities:Minority Interest
    
    
    
    
    
    
    127Provision for accounts receivable and sales returns and credits
    
    
    147
    
    
    
    188Depreciation and amortization
    
    
    790
    
    
    
    1,039Stock compensation expense
    
    
    1,029
    
    
    
    1,524Gain on disposal of assets, net
    
    
    
    
    
    
    (1,588
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    2,762
    
    
    
    2,355Inventories
    
    
    2,728
    
    
    
    6,669Prepaid expenses and other assets
    
    
    469
    
    
    
    175Accounts payable
    
    
    (2,571
    )
    
    
    (910
    )Accrued expenses and other current liabilities
    
    
    (1,751
    )
    
    
    172Net cash provided by operating activities
    
    
    3,303
    
    
    
    2,940Cash flows from investing activities:Purchase of property and equipment
    
    
    (107
    )
    
    
    (509
    )Proceeds from the sale of intangible assets
    
    
    
    
    
    
    1,850Purchase of investments
    
    
    (6,640
    )
    
    
    (1,238
    )Sale of investments
    
    
    8,950
    
    
    
    6,300Net cash provided by investing activities
    
    
    2,203
    
    
    
    6,403Cash flows from financing activities:Payment of non-current liabilities
    
    
    
    
    
    
    (25
    )Repurchase of common stock
    
    
    
    
    
    
    (2,147
    )Net proceeds from issuance of common stock and exercise of options and warrants
    
    
    28
    
    
    
    206Net cash provided by financing activities
    
    
    28
    
    
    
    (1,966
    )Effects of exchange rate changes on cash and cash equivalents
    
    
    19
    
    
    
    5Net increase in cash and cash equivalents
    
    
    5,553
    
    
    
    7,382Cash and cash equivalents, beginning of period
    
    
    15,908
    
    
    
    9,201Cash and cash equivalents, end of period
    
    $
    21,461
    
    
    $
    16,583
  3




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##### Table of Contents



IGO, INC. AND SUBSIDIARIES
 
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 (unaudited)
 (1) Basis of Presentation
    Recent Accounting Pronouncements
   4




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(2) Variable Interest Entities
   5




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##### Table of Contents



(Amounts in thousands)
 iGoVIE
    
    
    ConsolidatedASSETSCurrent assets:Cash and cash equivalents
    
    $
    700
    
    
    $
    21,461Short-term investments
    
    
    
    
    
    
    6,129Accounts receivable, net
    
    
    210
    *
    
    
    14,015Inventories
    
    
    730
    
    
    
    4,678Prepaid expenses and other current assets
    
    
    58
    
    
    
    248Total current assets
    
    
    1,698
    
    
    
    46,531Property and equipment, net
    
    
    85
    
    
    
    1,274Intangible assets, net
    
    
    
    
    
    
    1,813Long-term investments
    
    
    
    
    
    
    570Notes receivable (payable) and other assets
    
    
    (932)
    *
    
    
    399Total assets
    
    $
    851
    
    
    $
    50,587LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    242
    
    
    $
    9,312Accrued expenses and other current liabilities
    
    
    220
    *
    
    
    2,603Deferred revenue
    
    
    
    
    
    
    262Total current liabilities
    
    
    462
    
    
    
    12,177Minority interest
    
    
    384
    
    
    
    384Total liabilities
    
    
    846
    
    
    
    12,561Stockholders equity:
    
    
    5
    
    
    
    38,026Total liabilities and stockholders equity
    
    $
    851
    
    
    $
    50,587
 
 *
    
    Reflects the elimination of intercompany accounts and notes receivable. (3) Fair Value Measurement
    (4) Investments
    6




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##### Table of Contents



June 30, 2008
    
    
    December 31, 2007Net
    
    
    
    
    
    
    
    
    
    
    NetUnrealized
    
    
    
    
    
    
    
    
    
    
    UnrealizedHolding
    
    
    Aggregate
    
    
    
    
    
    
    HoldingAmortized
    
    
    Gains
    
    
    Fair
    
    
    Amortized
    
    
    Gains
    
    
    AggregateCost
    
    
    (Losses)
    
    
    Value
    
    
    Cost
    
    
    (Losses)
    
    
    Fair ValueU.S. corporate securities:Commercial paper
    
    $
    2,168
    
    
    $
    (2
    )
    
    $
    2,166
    
    
    $
    3,821
    
    
    $
    1
    
    
    $
    3,822Corporate notes and bonds
    
    
    3,369
    
    
    
    (7
    )
    
    
    3,362
    
    
    
    2,902
    
    
    
    
    
    
    
    2,9025,537
    
    
    
    (9
    )
    
    
    5,528
    
    
    
    6,723
    
    
    
    1
    
    
    
    6,724U.S. government securities
    
    
    599
    
    
    
    2
    
    
    
    601
    
    
    
    2,298
    
    
    
    4
    
    
    
    2,302$
    6,136
    
    
    $
    (7
    )
    
    $
    6,129
    
    
    $
    9,021
    
    
    $
    5
    
    
    $
    9,026
  June 30, 2008
    
    
    December 31, 2007Net
    
    
    
    
    
    
    
    
    
    
    NetUnrealized
    
    
    
    
    
    
    
    
    
    
    UnrealizedHolding
    
    
    Aggregate
    
    
    
    
    
    
    HoldingAmortized
    
    
    Gains
    
    
    Fair
    
    
    Amortized
    
    
    Gains
    
    
    AggregateCost
    
    
    (Losses)
    
    
    Value
    
    
    Cost
    
    
    (Losses)
    
    
    Fair ValueU.S. corporate notes and bonds
    
    $
    572
    
    
    $
    (2
    )
    
    $
    570
    
    
    $
    
    
    
    $
    
    
    
    $
    
 (5) Inventories
  June 30,
    
    
    December 31,2008
    
    
    2007Raw materials
    
    $
    862
    
    
    $
    1,029Finished goods
    
    
    3,816
    
    
    
    6,377$
    4,678
    
    
    $
    7,406
 (6) Intangible Assets
  June 30, 2008
    
    
    December 31, 2007Average
    
    
    Gross
    
    
    
    
    
    
    Net
    
    
    Gross
    
    
    
    
    
    
    NetLife
    
    
    Intangible
    
    
    Accumulated
    
    
    Intangible
    
    
    Intangible
    
    
    Accumulated
    
    
    Intangible(Years)
    
    
    Assets
    
    
    Amortization
    
    
    Assets
    
    
    Assets
    
    
    Amortization
    
    
    AssetsAmortized intangible
assets:License fees
    
    
    7
    
    
    $
    334
    
    
    $
    (309
    )
    
    $
    25
    
    
    $
    334
    
    
    $
    (280
    )
    
    $
    54Patents and trademarks
    
    
    5
    
    
    
    3,659
    
    
    
    (2,061
    )
    
    
    1,598
    
    
    
    3,368
    
    
    
    (1,726
    )
    
    
    1,642Trade names
    
    
    10
    
    
    
    429
    
    
    
    (239
    )
    
    
    190
    
    
    
    429
    
    
    
    (214
    )
    
    
    215Customer intangibles
    
    
    5
    
    
    
    33
    
    
    
    (33
    )
    
    
    
    
    
    
    33
    
    
    
    (18
    )
    
    
    15Total
    
    
    
    
    
    $
    4,455
    
    
    $
    (2,642
    )
    
    $
    1,813
    
    
    $
    4,164
    
    
    $
    (2,238
    )
    
    $
    1,926
  7




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##### Table of Contents



(7) Notes Receivable and Other Assets
   (8) Line of Credit
  (9) Stockholders Equity
  (10) Stock-based Compensation
    Nasdaq Rule2004 Directors Plan
    
    
    2004 Omnibus Plan
    
    
    4350(i)(1)(a)(iv) GrantWeighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    AverageValue per
    
    
    
    
    
    
    Value per
    
    
    
    
    
    
    Value perNumber
    
    
    Share
    
    
    Number
    
    
    Share
    
    
    Number
    
    
    ShareOutstanding, December 31, 2007
    
    
    194,667
    
    
    $
    4.64
    
    
    
    1,158,165
    
    
    $
    4.88
    
    
    
    1,000,000
    
    
    $
    2.13Granted
    
    
    49,832
    
    
    $
    1.27
    
    
    
    827,500
    
    
    $
    1.30
    
    
    
    
    
    
    
    Canceled
    
    
    (32,000
    )
    
    $
    6.88
    
    
    
    (33,848
    )
    
    $
    0.72
    
    
    
    
    
    
    
    Released to common stock
    
    
    (53,500
    )
    
    $
    1.28
    
    
    
    (250,570
    )
    
    $
    5.43
    
    
    
    (125,000
    )
    
    $
    2.96Released for settlement of taxes
    
    
    
    
    
    
    
    
    
    
    (124,251
    )
    
    $
    5.41
    
    
    
    
    
    
    
    Outstanding, June 30, 2008
    
    
    158,999
    
    
    $
    3.51
    
    
    
    1,576,996
    
    
    $
    2.54
    
    
    
    875,000
    
    
    $
    2.01
 8




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##### Table of Contents



(11) Net Loss per Share
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Basic net loss per share computation:Numerator:Net loss
    
    $
    (66
    )
    
    $
    (4,768
    )
    
    $
    (300
    )
    
    
    (6,811
    )Denominator:Weighted average number of common shares outstanding
    
    
    31,772
    
    
    
    31,574
    
    
    
    31,676
    
    
    
    31,657Basic net loss per share:
    
    $
    (0.00
    )
    
    $
    (0.15
    )
    
    $
    (0.01
    )
    
    $
    (0.22
    )Diluted net loss per share computation:Numerator:Net loss
    
    $
    (66
    )
    
    $
    (4,768
    )
    
    $
    (300
    )
    
    $
    (6,811
    )Denominator:Weighted average number of common shares outstanding
    
    
    31,772
    
    
    
    31,574
    
    
    
    31,676
    
    
    
    31,657Effect of dilutive stock options, warrants, and
restricted stock units
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,772
    
    
    
    31,574
    
    
    
    31,676
    
    
    
    31,657Diluted net loss per share:
    
    $
    (0.00
    )
    
    $
    (0.15
    )
    
    $
    (0.01
    )
    
    $
    (0.22
    )Stock options not included in dilutive net loss per share
since antidilutive
    
    
    285
    
    
    
    354
    
    
    
    285
    
    
    
    354Warrants not included in dilutive net loss per share since
antidilutive
    
    
    600
    
    
    
    1,195
    
    
    
    600
    
    
    
    1,195
 (12) Business Segments, Concentration of Credit Risk and Significant Customers
   9




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Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Revenues:High-Power Group
    
    $
    11,633
    
    
    $
    11,086
    
    
    $
    22,754
    
    
    $
    24,522Low-Power Group
    
    
    5,192
    
    
    
    6,533
    
    
    
    11,459
    
    
    
    10,740Connectivity Group
    
    
    1,728
    
    
    
    1,889
    
    
    
    3,278
    
    
    
    3,109$
    18,553
    
    
    $
    19,508
    
    
    $
    37,491
    
    
    $
    38,371
 Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Operating income (loss):High-Power Group
    
    $
    594
    
    
    $
    (1,996
    )
    
    $
    1,999
    
    
    $
    (72
    )Low-Power Group
    
    
    1,302
    
    
    
    (253
    )
    
    
    2,408
    
    
    
    (370
    )Connectivity Group
    
    
    148
    
    
    
    227
    
    
    
    63
    
    
    
    (609
    )Corporate
    
    
    (2,427
    )
    
    
    (4,745
    )
    
    
    (6,181
    )
    
    
    (8,330
    )$
    (383
    )
    
    $
    (6,767
    )
    
    $
    (1,711
    )
    
    $
    (9,381
    )
  June 30,
    
    
    December 31,2008
    
    
    2007Assets:High-Power Group
    
    $
    15,735
    
    
    $
    19,035Low-Power Group
    
    
    5,302
    
    
    
    7,810Connectivity Group
    
    
    1,703
    
    
    
    2,199Corporate
    
    
    27,847
    
    
    
    25,106$
    50,587
    
    
    $
    54,150
   Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007High-power mobile electronic power products
    
    $
    11,505
    
    
    $
    11,034
    
    
    $
    22,600
    
    
    $
    24,117Low-power mobile electronic power products
    
    
    5,167
    
    
    
    5,559
    
    
    
    10,954
    
    
    
    8,943Expansion and docking products
    
    
    1,728
    
    
    
    1,889
    
    
    
    3,278
    
    
    
    3,109Portable keyboard products
    
    
    25
    
    
    
    974
    
    
    
    505
    
    
    
    1,797Accessories and other products
    
    
    128
    
    
    
    52
    
    
    
    154
    
    
    
    405Total revenues
    
    $
    18,553
    
    
    $
    19,508
    
    
    $
    37,491
    
    
    $
    38,371
 10




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##### Table of Contents



Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007North America (principally United States)
    
    $
    17,966
    
    
    $
    16,325
    
    
    $
    34,626
    
    
    $
    31,491Europe
    
    
    285
    
    
    
    605
    
    
    
    1,441
    
    
    
    1,760Asia Pacific and all other
    
    
    302
    
    
    
    2,578
    
    
    
    1,424
    
    
    
    5,120$
    18,553
    
    
    $
    19,508
    
    
    $
    37,491
    
    
    $
    38,371
 Three Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2008
    
    2007
    
    2008
    
    2007OEM and private-label-resellers
    
    
    51
    %
    
    
    56
    %
    
    
    50
    %
    
    
    60
    %Retailers and distributors
    
    
    45
    %
    
    
    39
    %
    
    
    45
    %
    
    
    34
    %Other
    
    
    4
    %
    
    
    5
    %
    
    
    5
    %
    
    
    6
    %100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
      (13) Litigation Settlement
  (14) Contingencies
  11




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##### Table of Contents



ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 www.igo.com
 
    
    the loss of, and failure to replace, any significant customers;
    
    the inability to timely and successfully complete product development efforts and
introduce new products, including internal development projects and those being pursued
with strategic partners;
    
    the ineffectiveness of our sales and marketing strategy;
    
    the inability to create broad consumer awareness and acceptance for our products and
technology;
    
    the timing and success of competitive product development efforts, new product
introductions and pricing;
    
    the ability to expand and protect our proprietary rights and intellectual property;
    
    the timing of substantial customer orders;
    
    the lack of available qualified personnel;
    
    the inability to successfully resolve pending and unanticipated legal matters;
    
    the lack of available qualified suppliers and subcontractors and/or their inability
to meet our specification, performance, and quality requirements; and
    
    market demand and industry and general economic or business conditions.
 12




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##### Table of Contents



iGo® is a trademark or registered trademark of iGo, Inc. or its subsidiaries in the United
States and other countries. Other names and brands may be claimed as the property of others.
 Overview
      High-Power Group.
 13




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##### Table of Contents



Low-Power Group.
  Connectivity
Group. ®
 Recent Developments
      14




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##### Table of Contents



Critical Accounting Policies and Estimates
  Results of Operations
  June 30,
    
    June 30,2008
    
    2007
    
    2008
    
    2007Revenue
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of revenue
    
    
    70.9
    %
    
    
    89.1
    %
    
    
    70.7
    %
    
    
    80.4
    %Gross profit
    
    
    29.1
    %
    
    
    10.9
    %
    
    
    29.3
    %
    
    
    19.6
    %Operating expenses:Sales and marketing
    
    
    12.1
    %
    
    
    13.8
    %
    
    
    11.4
    %
    
    
    14.2
    %Research and development
    
    
    4.9
    %
    
    
    7.5
    %
    
    
    4.5
    %
    
    
    8.2
    %General and administrative
    
    
    14.2
    %
    
    
    24.3
    %
    
    
    18.0
    %
    
    
    21.7
    %Total operating expenses
    
    
    31.2
    %
    
    
    45.6
    %
    
    
    33.9
    %
    
    
    44.1
    %Loss from operations
    
    
    (2.1
    %)
    
    
    (34.7
    %)
    
    
    (4.6
    %)
    
    
    (24.5
    %)Other income (expense):Interest, net
    
    
    1.1
    %
    
    
    1.5
    %
    
    
    1.3
    %
    
    
    1.4
    %Other, net
    
    
    0.6
    %
    
    
    9.4
    %
    
    
    0.7
    %
    
    
    5.6
    %Litigation settlement income
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    1.8
    %
    
    
    0.0
    %Minority interest
    
    
    0.0
    %
    
    
    (0.7
    %)
    
    
    0.0
    %
    
    
    (0.3
    %)Net loss
    
    
    (0.4
    %)
    
    
    (24.5
    %)
    
    
    (0.8
    %)
    
    
    (17.8
    %)
 Comparison of Three Months Ended June 30, 2008 and 2007
 Revenue .
 Three Months
    
    
    Three Months
    
    
    Increase/(decrease)
    
    
    Percentage changeEnded
    
    
    Ended
    
    
    from same period
    
    
    from the same periodJune 30, 2008
    
    
    June 30, 2007
    
    
    in the prior year
    
    
    in the prior yearHigh-Power Group
    
    $
    11,633
    
    
    $
    11,086
    
    
    $
    547
    
    
    
    4.9
    %Low-Power Group
    
    
    5,192
    
    
    
    6,533
    
    
    
    (1,341
    )
    
    
    (20.5
    )%Connectivity Group
    
    
    1,728
    
    
    
    1,889
    
    
    
    (161
    )
    
    
    (8.5
    )%Total Revenue
    
    $
    18,553
    
    
    $
    19,508
    
    
    $
    (955
    )
    
    
    (4.9
    )%
 High-Power Group.
 15




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Low-Power Group.
 Connectivity Group.
 Cost of revenue, gross profit and gross margin .
 Three Months
    
    Three Months
    
    Increase/(decrease)
    
    Percentage change fromEnded
    
    Ended
    
    from same period in
    
    the same period in theJune 30, 2008
    
    June 30, 2007
    
    the prior year
    
    prior yearCost of revenue
    
    $
    13,149
    
    
    $
    17,389
    
    
    $
    (4,240
    )
    
    
    (24.4
    )%Gross profit
    
    $
    5,404
    
    
    $
    2,119
    
    
    $
    3,285
    
    
    
    155.0
    %Gross margin
    
    
    29.1
    %
    
    
    10.9
    %
    
    
    18.2
    %
    
    
    167.0
    %
  16




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##### Table of Contents



Sales and marketing .
 Three Months
    
    Three Months
    
    Decrease
    
    Percentage changeEnded
    
    Ended
    
    from same period
    
    from the same periodJune 30, 2008
    
    June 30, 2007
    
    in the prior year
    
    in the prior yearSales and marketing
    
    $
    2,247
    
    
    $
    2,685
    
    
    $
    (438
    )
    
    
    (16.3
    )%
  Research and development .
 Three Months
    
    Three Months
    
    Decrease from
    
    Percentage change fromEnded
    
    Ended
    
    same period
    
    the same period in theJune 30, 2008
    
    June 30, 2007
    
    in the prior year
    
    prior yearResearch and development
    
    $
    910
    
    
    $
    1,457
    
    
    $
    (547
    )
    
    
    (37.5
    )%
  General and administrative.
 Three Months
    
    Three Months
    
    Decrease
    
    Percentage changeEnded
    
    Ended
    
    from same period
    
    from the same periodJune 30, 2008
    
    June 30, 2007
    
    in the prior year
    
    in the prior yearGeneral and administrative
    
    $
    2,630
    
    
    $
    4,744
    
    
    $
    (2,114
    )
    
    
    (44.6
    )%
  Interest income, net.
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Gain on disposal of assets and other income, net .
 Minority interest.
 Income taxes .
 Comparison of Six Months Ended June 30, 2008 and 2007
 Revenue .
 Six Months
    
    
    Six Months
    
    
    Increase/(decrease)
    
    
    Percentage changeEnded
    
    
    Ended
    
    
    from same period
    
    
    from the same periodJune 30, 2008
    
    
    June 30, 2007
    
    
    in the prior year
    
    
    in the prior yearHigh-Power Group
    
    $
    22,754
    
    
    $
    24,522
    
    
    $
    (1,768
    )
    
    
    (7.2
    )%Low-Power Group
    
    
    11,459
    
    
    
    10,740
    
    
    
    719
    
    
    
    6.7
    %Connectivity Group
    
    
    3,278
    
    
    
    3,109
    
    
    
    169
    
    
    
    5.4
    %Total Revenue
    
    $
    37,491
    
    
    $
    38,371
    
    
    $
    (880
    )
    
    
    (2.3
    )%
 High-Power Group.
 Low-Power Group.
 18




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Connectivity Group.
 Cost of revenue, gross profit and gross margin .
 Six Months
    
    Six Months
    
    Increase/(decrease)
    
    Percentage change fromEnded
    
    Ended
    
    from same period in
    
    the same period in theJune 30, 2008
    
    June 30, 2007
    
    the prior year
    
    prior yearCost of revenue
    
    $
    26,509
    
    
    $
    30,846
    
    
    $
    (4,337
    )
    
    
    (14.1
    )%Gross profit
    
    $
    10,982
    
    
    $
    7,525
    
    
    $
    3,457
    
    
    
    45.9
    %Gross margin
    
    
    29.3
    %
    
    
    19.6
    %
    
    
    9.7
    %
    
    
    49.5
    %
  Sales and marketing .
 Six Months
    
    Six Months
    
    Decrease
    
    Percentage changeEnded
    
    Ended
    
    from same period
    
    from the same periodJune 30, 2008
    
    June 30, 2007
    
    in the prior year
    
    in the prior yearSales and marketing
    
    $
    4,261
    
    
    $
    5,442
    
    
    $
    (1,181
    )
    
    
    (21.7
    )%
  Research and development .
 Six Months
    
    Six Months
    
    Decrease from
    
    Percentage change fromEnded
    
    Ended
    
    same period
    
    the same period in theJune 30, 2008
    
    June 30, 2007
    
    in the prior year
    
    prior yearResearch and development
    
    $
    1,703
    
    
    $
    3,134
    
    
    $
    (1,431
    )
    
    
    (45.7
    )%
 19




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General and administrative.
 Six Months
    
    Six Months
    
    Decrease
    
    Percentage changeEnded
    
    Ended
    
    from same period
    
    from the same periodJune 30, 2008
    
    June 30, 2007
    
    in the prior year
    
    in the prior yearGeneral and administrative
    
    $
    6,729
    
    
    $
    8,330
    
    
    $
    (1,601
    )
    
    
    (19.2
    )%
  Interest income, net.
 Gain on disposal of assets and other income, net .
 Litigation settlement income .
 Minority interest.
 Income taxes .
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Operating Outlook
  
    
    Continued growth in sales of power products for high-power mobile electronic devices
driven by further growth in private label reseller accounts and expanded international
distribution;
    
    Continued penetration of both the domestic and international wireless carrier,
dealer/agent, retail and distributor markets for our low-power products;
    
    Continued investment in enhancements to grow direct online sales through igo.com and
retail partner web sites;
    
    A strong new product pipeline that will provide consumers with innovative power products
offering a broad range of features and price points;
    
    An emphasis on development and marketing of products that are environmentally friendly; and
    
    Improvements in operational execution.
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Liquidity and Capital Resources
  Six Months Ended June 30,2008
    
    
    2007Net cash provided by operating activities
    
    $
    3,303
    
    
    $
    2,940Net cash provided by investing activities
    
    
    2,203
    
    
    
    6,403Net cash provided by financing activities
    
    
    28
    
    
    
    (1,966
    )Foreign currency exchange impact on cash flow
    
    
    19
    
    
    
    5Increase in cash and cash equivalents
    
    $
    5,553
    
    
    $
    7,382Cash and cash equivalents at beginning of period
    
    $
    15,908
    
    
    $
    9,201Cash and cash equivalents at end of period
    
    $
    21,461
    
    
    $
    16,583
 Cash and Cash Flow
 
    
    Net cash provided by operating activities.Cash was provided by operating activities
for the six months ended June 30, 2008 primarily as a result of collections of accounts
receivable and sales of inventory, partially offset by use of cash to pay suppliers.
Later in 2008, we expect  operating activities and  changes in
working capital to have a  relatively neutral effect on
cash flows. Our consolidated cash flow operating metrics are as follows:
 June 30,2008
    
    2007Days outstanding in ending accounts receivable (DSOs)
    
    
    68
    
    
    
    86Inventory turns
    
    
    11
    
    
    
    11
  
    
    Net cash provided by investing activities.For the six months ended June 30, 2008,
net cash was provided by investing activities as we generated proceeds from the sale of
investments of $2.2 million. We anticipate future investment in capital equipment,
primarily for tooling equipment to be used in the production of new products.
    
    Net cash provided by financing activities.Net cash provided by financing
activities for the six months ended June 30, 2008 was primarily from net proceeds from
the exercises of stock options and warrants. Although we expect to generate cash flows
from operations sufficient to support our operations, we may issue additional shares of
stock in the future to generate cash for growth opportunities.
  22




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Financing Facilities.
 Contractual Obligations.
 Payment due by period2008
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    More than 5 yearsOperating lease obligations
    
    $
    303
    
    
    $
    51
    
    
    $
    8
    
    
    $
    6
    
    
    $
    
    
    
    $
    Inventory purchase obligations
    
    
    14,461
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other long-term obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Totals
    
    $
    14,764
    
    
    $
    51
    
    
    $
    8
    
    
    $
    6
    
    
    $
    
    
    
    $
    
  Off-Balance Sheet Arrangements.
 Acquisitions and dispositions.
   Liquidity Outlook.
 Recent Accounting Pronouncements
  
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  23




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##### Table of Contents



ITEM 4. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
 Changes in Internal Control Over Financial Reporting
 
 PART II OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
   24




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ITEM 1A. RISK FACTORS
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  1.
    
    Election of Peter L. Ax and Michael J. Larson as Class II members of our Board of Directors,
to serve until the 2011 Annual Meeting of Stockholders:
 Nominee
    
    For
    
    Withheld AuthorityPeter L. Ax
    
    
    27,131,868
    
    
    521,553Michael J. Larson
    
    
    27,135,098
    
    
    518,323
 2.
    
    Ratification of the selection of KPMG LLP as the Companys independent registered public
accounting firm for the fiscal year ending December 31, 2008.
 Votes for
    
    
    27,524,934Votes against
    
    
    119,180Votes abstained
    
    
    9,307
  
 ITEM 6. EXHIBITS
  25




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##### Table of Contents



IGO, INC. AND SUBSIDIARIES
 
 SIGNATURES
  IGO, INC.Dated: August 8, 2008
    By:
    /s/ Michael D. HeilMichael D. HeilPresident, Chief Executive Officer
          and Chairman of the Board
     (Principal Executive Officer) By:
    /s/ Joan W. BrubacherJoan W. BrubacherExecutive Vice President and Chief Financial Officer
     and Authorized Officer of Registrant
(Principal Financial Officer) By:
    /s/ Darryl S. BakerDarryl S. BakerVice President, Chief Accounting Officer and Controller 26




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description of Document3.1
    
    
    Certificate of Incorporation of the Company (1)3.2
    
    
    Articles of Amendment to the Certificate of Incorporation of the Company dated as of June 17, 1997 (2)3.3
    
    
    Articles of Amendment to the Certificate of Incorporation of the Company dated as of September 10, 1997 (1)3.4
    
    
    Articles of Amendment to the Certificate of Incorporation of the Company dated as of July 20, 1998 (1)3.5
    
    
    Articles of Amendment to the Certificate of Incorporation of the Company dated as of February 3, 2000 (1)3.6
    
    
    Articles of Amendment to the Certificate of Incorporation of the Company dated as of March 31, 2000 (2)3.7
    
    
    Certificate of Designations, Preferences, Rights and Limitations of Series G Junior Participating
Preferred Stock of iGo, Inc. (3)3.8
    
    
    Certificate of Ownership and Merger effecting name change to iGo, Inc. (4)3.9
    
    
    Certificate of Elimination of Series C, Series D, Series E and Series F Preferred Stock (4)3.10
    
    
    Second Amended and Restated Bylaws of the Company (4)31.1
    
    
    Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*31.2
    
    
    Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*32.1
    
    
    Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002**
 
 *
    
    Filed herewith**
    
    Furnished herewith (1)
    
    Previously filed as an exhibit to Registration Statement No. 333-30264 dated February 11,
2000.(2)
    
    Previously filed as an exhibit to Amendment No. 2 to Registration Statement No. 333-30264 on
Form S-1 dated May 4, 2000.(3)
    
    Previously filed as an exhibit to Current Report on Form 8-K filed June 19, 2003.(4)
    
    Previously filed as an exhibit to Current Report on Form 8-K filed May 21, 2008.
 27