Q4 2020 Ideal Power Inc Earnings Call
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Yeah.
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Good day and welcome to the ideal power fourth quarter 2020 results Conference call Today's conference is being recorded.
At this time I would like to turn the conference over to Caroline <unk> yet from LHE. Please go ahead.
Thank you Kevin and good afternoon, everyone. Thank you for joining ideal powers fourth quarter 2020 conference call with me on the line are Dan <unk>, President and Chief Executive Officer, and Tim Burns Chief Financial Officer ideal powers fourth quarter and full year 2020 financial results press release is available on the company's website at <unk>.
Ideal power Dot com.
Before we begin I'd like to remind everyone that statements made on the call and webcast, including those regarding future financial results and industry prospects are forward looking and maybe subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the call. Please refer to the company's SEC filings for a list of associated.
Risks and we would also get a framework of the company's website for more supporting industry information now I will turn the call over to Idaho power, President and CEO, Dan <unk> Dan.
Thank you Carolyn and good afternoon, everyone and welcome to our fourth quarter and full year 2020 financial results conference call I'll.
Begin by giving you an update on our progress and achievements towards our strategy to commercialize our b Tran semiconductor architect for technology.
I'll also describe our objectives for 2021.
To work towards completion of the NAV fee program for final device demonstration in mid 2022 and to complete the steps in our Retrans strategy for enable commercialization.
Then Tim Burns, our CFO, who will take you through the numbers.
Throughout 2020, we sustained that momentum toward our commercialization goals that are moving into 2021 with continued excitement about our prospects for B Tran is a differentiated technology addressing a large and growing market and with our balance sheet strengthened by our recent equity offering to help make those prospects a reality, let's start on discussion with our work with <unk>.
Net states maybe.
Our work for the Naval Sea systems command, our NAV C in collaboration with diversified technologies or DTI remains on schedule.
As background in the second quarter of 2020, we signed a $1 $2 million subcontract with DTI on the development and demonstration of our B Tran enabled direct card medium voltage circuit breaker as part of the U S. Navy's strategic focus on ship electrification.
The contract is funded by the department of Defense's rapid innovation from the purpose of which is to accelerate the commercialization of high value high impact technologies.
Our project with DTI for NAV is intended to develop and demonstrate a be trained enabled high efficiency 12, kilovolt medium voltage direct current circuit breaker for the U S. Navy with a subsequent objective of introducing a family of medium voltage DC circuit breaker products, incorporating retrans for sale to the military industrial.
And utility markets.
As we discussed with you on our last call during the fourth quarter. We completed the first major milestone in the program. The first wafer fabrication runs conducted by Teledyne and we tested and selected wafers for Deicing and packaging at the B Tran devices, using our lab based packaging design.
The results from this testing were incorporated into the device and packaging design and manufacturing process improvements for subsequent rounds.
Recently, we completed the second major milestone on the program and are in receipt of the wafers from Teledyne's second fabrication run incorporating those design and manufacturing process improvements and we're now testing in selecting these wafers for Deicing and packaging at the B Tran devices.
The packaging for this run we utilize the new design developed by the University of Texas at Austin under the NAV C program.
Over the two year program, we plan on a total of five runs over six quarters aiming for optimized device delivery in late 2021 with the final demonstration of a 12 kilovolt MTBC breaker in mid 2020 to the.
For the development process is iterative with performing multiple multiple wafer fabrication runs to assess the tradeoffs between maximum theoretical device performance and its manufacture ability.
The purpose of the success of fabrication runs is to optimize the device designed for performance and manufacture ability.
The third fabrication of our hotel guidance, which is the next major milestone in the last day program has begun and is expected to be completed in the second quarter for 2021.
We've been through multiple project reviews.
With the FCC and continue to receive positive feedback on our progress to date.
Under the assay program during the fourth quarter, the University of Texas at Austin Semiconductor Power Electronics Center completed its initial design of our new B Tran device packaging in collaboration with the commercial packaging firm for UT Austin design was modified to enhance its ability to be manufactured in high volume the new.
Packaging design improves upon the lab based packaging. We've used previously is intended to provide the electrical connections form factor and thermal management required to incorporate a semiconductor device into an end user product design.
The new packaging will encapsulate the trend on into a package similar to those commonly available for commercial RGB cheese and this packaging design will be utilized for future <unk> under the <unk> program and our customer engineering prototypes sampling program.
As a reminder, chip electrification is a high priority initiative and the Navy as it can significantly enhance the energy efficiency of ship operations improve their operational flexibility and lower cost.
<unk> distributed power on ships makes them less vulnerable to attacks by lowering the noise signature and enhancing their stock capabilities and B Tran technology offer substantial size and loss reduction of the continuously conducting semiconductor devices, such as <unk> without using complex large and heavy liquid cooling systems.
We're very excited about the progress being made under the <unk> program and this progress continues to benefit our overall validation and commercialization efforts.
During the fourth quarter semiconductor power Electronics center at the University of Texas for Austin also designed and fabricated and initial laboratory version of our B Tran driver subsequently as we announced earlier this month the talented post Doc who designed the lab prototypes for the device also completed a first generation commercial version of our B Tran driver.
Incorporating feedback from our testing for.
The new driver designs removes some of the features that were included in the laboratory version truly for debugging purposes.
And also reduce the footprint of the driver for over 50%.
The new driver design also adds additional operating capabilities to the programming of the driver, including an improvement to the switching performance through faster turn off resulting in significantly lower switching losses the.
For the post office work has been closely supervised by Dr. Alex Wang the leader of the semiconductor power Electronics Center and a world renowned expert in power semiconductor devices and power electronics.
The new drivers that fabricated and tested and additional units are being fabricated for use in our engineering prototype sampling program.
Our development of <unk>.
<unk> dedicated driver is a crucial step in the commercialization of B Tran devices.
<unk> is a double sided device with unique architecture and are developing designing and fabricating. This driver removes the need for potential customers to do so facilitating the technical evaluation of the device by presenting them with test ready engineering prototype samples.
The sampling program will provide engineering samples to potential end users and gather their feedback from the device the packaging design the driver as well as general feature sets and priorities.
Feedback will allow us to determine calling requirements across applications that can then be incorporated into intelligent power module design that we plan to bring to market in 2022 as part of our B Tran commercialization on.
Operating and intelligent power module, rather than a discrete device should accelerate b trans commercial adoption.
With our new packaging design and driver designed complete we're now ready to engage with customers for our engineering prototype sampling program for.
For this and we recently announced the hiring of a vice president of business development, who joined our team in late February.
Matt brings an impressive and successful background in sales and business development for both silicon and silicon carbide devices as well as established customer relationships in the electric vehicles and renewable energy markets to markets, which were targeting for our customer sampling program.
Bringing on a dedicated senior business development leader is an exciting step forward for ideal power as we began collaborating with customers for the engineering sampling program and subsequent commercialization.
Thanks for his strong semiconductor background and customer relationships just been able to hit the ground running these prioritized. The inbound requests we have received from potential customers added numerous high profile target for the list and is actively engaged with several of our highest priority target customers to drive customer sampling agreement disclosure.
We're looking for to be able to talk more about the high quality companies and institutions, we're engaging with for the program as we formalize our relationships.
Looking at the B Tran patent estate. We currently have 58 issued B Tran patents, one more than last quarter with 21 of those issues outside of the United States and 26 pending patents.
Our geographic coverage includes North America, China, Japan, and Europe with potential to expand coverage into South Korea and India.
As part of the driver development process, we identified improvements in performance and device protection that enhance the capability of B Tran patent protection for these inventions was filed with the U S patent office.
Our focus for 2021 remains twofold to achieve our objectives under the Nazi program with a target of delivering non optimized device in late 2021 for incorporation into the demonstration for the 12 kilovolt and BDC breaker in mid 2022.
As we complete the steps in our <unk> strategy staging B Tran technology for commercialization in 2022.
With respect to MFC as we progress towards delivery, we continue to view our collaboration with DTI is a significant potentially catalytic opportunity.
Retrans performance characteristics over conventional power switches, including power efficiency and low code requirements, and thus smaller OEM product designs.
Enabled to solid state circuit breaker application.
This potential is high as a game changer for distributed DC networks across a wide variety for military industrial and utility applications.
Mid to high mid to high and medium.
Medium to high voltage DC transmission and distribution systems micro grids, and electrical generation related to renewables solar and wind energy and energy storage.
With respect to detract commercialization the engineering sampling program is now underway as we've begun to engage with prospective program participants targeting putting multiple sample agreements in place in order to gather feedback from customers that can be used to prepare an intelligent power module for initial commercial sales in 2022.
Our commercialization efforts will focus on establishing strategic development and commercial partnerships.
Building commercial momentum and laying the foundation for future be try on revenue streams.
<unk> market is already a $6 billion market estimated to grow to $9 4 billion for 2025.
The key high growth segments within the <unk> market that we plan to target for initial commercial sales, including electric vehicles and electric vehicle charging.
And wind energy and energy storage and data center on interruptible power supplies.
Since the transition from sampling to commercial sales will vary by market segment and individual customers. We expect to continue to add potential customers and applications to the engineering sampling program over time, while simultaneously commercializing b Tran for markets and applications already in the sampling program.
The timeline for these spaces will also vary as prospective customers, even those with similar applications have different technology evaluation cycles and design periods for incorporating new technologies into their products.
Overall, we recently achieved our second milestone with Nazi completed a dedicated B Tran driver created a manufacturing ready packaging design, we expect to start announcing sampling agreements in the coming months debt, we expect to lead to initial commercial agreements targeting first commercial revenue in 2022.
Our strong balance sheet will support our efforts and positions us to be an attractive partner for the corporations of size that we're targeting for our customer sampling program.
And all testing results of B, Tran wafers and die underscore our belief in ideal powers B Tran technology is potentially transformational with its unique bidirectional switching capability lower switching on a conduction losses, lower user cost and improved and more compact thermal management.
These advantages B Tran has the ability to solve the immediate needs of car electronics applications in both high growth high demand markets, while enabling new market segments.
We continue for the rest well on our plans and are now entering a key step on our commercialization strategy engaging prospective customers and our engineering prototype sampling program.
As we enter 2021, we're very excited about our future and we have because we have a differentiated patented technology that can address a large and rapidly growing market armed with a strong balance sheet to make our vision a reality.
Now I'd like to hand, the call over to our Chief Financial Officer, Tim Burns for a review of our fourth quarter and full year 2020 financial results.
Thank you Dan I will review fourth quarter and full year 2020 financial results.
In the fourth quarter, we recorded approximately $274000 of grant revenue totaling $428000 of grant revenue for the year with offsetting cost of grant revenue as we continued our work on the Navy funded NAV C demonstration project under the Ti contract, which began in late June.
Fourth quarter 2020, operating expenses were $1 1 million compared to zero point $8 million from the fourth quarter 2019.
The increase in operating expenses in the quarter was due to higher research and development spending.
Full year 2020 operating expenses for $4 $1 million.
Compared to $3 $1 million in full year 2019.
For full year increase in operating expenses related to B, Tran wafer fabrication and driver development spending as well as higher noncash stock compensation expense.
Fourth quarter 2020, net loss was $1 1 million compared to zero point $8 million in the fourth quarter of 2019, as a result of higher research and development expenses.
Net loss for the full year 2020 was $7 8 million inclusive of noncash warrant inducement expense of $3 $7 million.
<unk> to $3 $9 million in full year 2019.
The full year 2019, net loss included a zero point $8 million loss from discontinued operations related to the <unk> operations, which we sold in September 2019.
Fourth quarter 2020 cash used in operating activities was zero point $7 million flat compared to cash used in operating activities in the fourth quarter of 2019.
And down from zero point $8 million in the third quarter of 2020.
Full year 2020 cash used in operating activities was $3 million.
Consistent with the approximately $750000 per quarter burn rate that we had forecasted for 2020.
During 2020, we raised $2 $5 million in net proceeds from the early warrant exercise transaction that we completed in August.
As well as an additional zero point $6 million from other warrant exercises.
Cash and cash equivalents totaled $3 2 million as of December 31, 2020.
Our debt outstanding remained zero point $1 million as in the second quarter, we received a paycheck protection program loan to temporarily subsidized payroll and facilities costs and the business landscape impacted by the COVID-19 pandemic.
We recently applied for forgiveness of our PPP loans and while our expectation is that this loan will be forgiven, we cannot provide assurance that we'll be granted forgiveness of the loan in whole or endpoint.
Subsequent to year end and through the end of February 2021, we raised an additional $3 $2 million from the exercise of warrants.
Also in February 2021, we completed an underwritten public offering of one 4 million shares of our common stock at $17 per share.
For net proceeds of $21 $2 million.
We expect to use a portion of the proceeds from the underwritten public offering and warrant exercises in 2021.
Q1 modestly build on our commercial team, which started with bringing Jeff Knapp onboard as our vice president of business development.
Plan on hiring additional talent focused on the front end customer facing parts of the business, including additional resources to support our customers sampling program and.
<unk> commercialization.
To build on our technical team expanding our capabilities and bring on a few additional internal resources to provide expertise where we previously relied on third parties.
Three now there weren't engaging with large companies and our customer sampling program.
Finding additional domestic semiconductor fabrication partner.
For for general corporate and working capital purposes.
As a result of these activities designed to enable the commercialization of our B Tran technology in 2022.
We expect an overall moderately upward trends in our quarterly cash burn in 2021.
For the first quarter of 2021, we expect cash used in operating activities of approximately $850000 for $875000.
Compared to an approximately $750000 per quarter cash burn in 2020.
For the full year 2021, we currently expect cash used in operating activities of approximately $4 million.
Although our cash burn maybe modestly higher depending on the pace of the commercialization activities for that just mentioned.
As a result of the underwritten public offering and warrant exercises and as of February 28 2021.
We had $5 9 million shares of common stock outstanding.
We also had a $1 million in the money warrants outstanding as well as zero point for millions of stock options outstanding for fully diluted shares outstanding of seven 3 million shares.
At February 28, 2021 are unaudited cash balance was $27 $2 million with.
With our strengthened balance sheet, we have ample liquidity.
Given our modest cash burn.
On multiple years of operations and we're now a low capitalized partner for the larger companies that we expect to participate in our customer sampling program.
At this time I'd like to open up the call for questions operator.
Thank you.
Ladies and gentlemen, if you wish to ask a question at this time, please signal by pressing star one on your telephone keypad. Please ensure that the mute function on your telephone is switched off to allow your signal to reach our equipment again. Please press star one to ask a question.
Brief pulse for all participants the opportunity to signal for questions.
Okay.
Our first question today comes from Ruben Roy from Benchmark company.
Hi, Thank you thanks for taking my questions and congrats Dan and for the continued progress through year end and so far on 'twenty, one Dan I wanted to.
Yes.
I wanted to drill in a bit on.
The upcoming sampling programs thats, great to hear about the <unk>.
Driver.
Progress over at Ut.
And you did talk about some additional runs that are going to be happening at teledyne over the next few quarters several quarters.
You're working with NAV C.
What needs to happen.
To get started sampling our <unk>.
Other customers going do we need to get.
Several more runs going do you need a data sheet now that you have the.
Driver or maybe you can just help us understand kind of the timing on the puts and takes of getting to your actual samples and the customers.
Sure.
A whole variety of things that are happening.
For those that are kind of already in the queue with we're already engaged with we already shared information with them in terms of device performance.
Some features about the driver, but there'll be more information coming off the driver.
For those that are likely to be candidates were going to be putting together a bit to get product information sheet that wants to put on the website that will give people a lot of information about the device its operation visual. Thank the technical team are looking at in terms of operating parameters, but also information about the physical package in term.
As of its size its dimensions and also information about the driver itself.
As it relates to actually getting the physical samples on People's hands, we are already having multiple copies of the driver that has now been designed and tested already made since.
It's done by a third party PCB firm.
So those are actually into and we will make more of those as we go along.
And then for the devices themselves.
Either be able to take some from Nazi with their cooperation or we will do an additional run debt is dedicated just for.
For the customer sampling program will have some flexibility and it's really going to be up to the discussion we have to have with NAV in terms of how many.
Let us use for the sampling program, because it's not going to be a big portion of our run.
Vs what needs to be used to satisfy the nasty program.
Okay.
That's very helpful. So.
You also mentioned sort of the new packaging.
Design, which has improved improving on your lab based packaging designs that youre already using and it sounds like the encapsulation of Bob B Tran.
Commercial package at some point is going to be similar to <unk>.
Maybe you could just walk me through how to think about that from a footprint perspective, how does it work with the driver in some of these end markets is the PCB going to be encapsulated in the package itself and.
Can it be a consistent package across some of these end market applications that youre targeting.
Yes.
For this the package itself for those that are familiar with what <unk> look like its discrete devices. It will look just like in IGT with a fourth lead in for three lease.
If youre familiar with what a.
<unk> hundred 47 looks like for <unk>, it looks very much like that the same dimensions. The only differences just a force connection.
For the sampling program the driver and the.
Package B Tran will be physically separate.
The B Tran packages basically saw there to the driver. So you can if you want to test multiple devices you can broaden the disorder. The package B Tran and we'll give you one driver that you can use for all of those our expectation is that based on what we're seeing for performance of devices and also the early feedback that we're getting for.
From people that were engaging with on the sampling program is the day trend itself is going to likely be identical for all the applications. Because we don't have to do the typical trade offs that RGB manufacturers do where they're trading off conduction losses versus current tails and so the nature of B Tran eliminates a lot of those IGT specific.
<unk> issues.
So at least for certainly the foreseeable future. The B Tran will be the same regardless of the application the packaging will likely be the same for.
For most applications. We may ultimately go to some bigger packages that have multiple die in a package just likely confined with IGT and changes that are application specific or more likely going to end up being reflected in the driver versus the actual wafers, but we have to fabricate.
A telephone.
Got it interesting.
Well I guess the last question for you and then I just had a quick one for Ken.
Just on sort of the timing of.
How do you think about 'twenty, two and as we get the latest stages of commercialization and revenue.
Guys have been talking about potentially working with DTI.
On additional circuit breaker products.
As you flow through this NAV.
The objectives et cetera, and potentially have circuit breakers for sale to other customers industrial on otherwise.
What's your thinking there in terms of.
Timing of revenue you think will be seeing kind of circuit breaker packaged products out in market and then.
Beyond that we will start to see some sales of actual b Tran devices into other markets or do you think it's going to just depend and maybe we'll see a little bit of both as we kind of flow through 'twenty two.
I think we'll actually see.
B Tran device sales probably be for we see our circuit breaker sales and that's really kind of for two reasons, one as well.
For detailed wants to bring out a variety of products. In fact, they are obligated to come out with a variety of products for the Navy and for the military more broadly.
That is a longer sales cycle in terms of just how the military does things.
There is an interest in the ability to sell them to industrial and utility markets, but that's on the EPS strong suit. So we fortunately are not constrained in our relationship with DTI for the program. So I think what the demonstration itself is successful.
We will actually engage with other companies that are more targeted at the utility and industrial segment and actually.
This would give them an opportunity to have something that would be a unique and differentiated product compared to what they already have so I expect that will ultimately end up with multiple players who are bringing a b tran based on a breaker to market.
From what we're seeing I think theres going to be earlier opportunities for things, particularly related to electric vehicles electric vehicle charging and renewable for actually selling b trans, particularly once we get to the integrated power module.
Mhm.
Okay excellent great.
Great and just a.
Quick follow up for Ken Ken You mentioned.
Couple of the areas that youre targeting for use of funds all understandable given kind of where we are.
Progress on the on the technology one on one thing you didn't note.
Interestingly the qualification.
For an additional domestically for.
Fabrication partner.
Kind of driving that at this point is it just kind of.
Making sure you have multiple sources as you get closer to commercialization or is there something going on at teledyne or otherwise.
It's driving you know kind of how youre thinking about an additional partner there.
Yes.
Take first crack at that and then can add his thoughts.
There's a couple of things are driving it.
We are engaged with some customers.
We will potentially be adopting our technology, whose volume demand is going to be very big if we're successful with them.
We know from the things that Jeff has done with them in the past and things that I've done with some of them in the past they will require a second source, it's not an option it wouldn't matter if we.
Think that ex GAAP will require a second source for risk mitigation because.
Back to them from a loss for supplies is $2 billion.
We view it also is an opportunity just as on all risk mitigation that we really like.
The team the facilities they have great expertise.
But we want to make sure that for example, the fact that we work with Teledyne in California. If there was an earthquake, we don't lose the ability to run wafers. So we think this is part of our on risk mitigation. It makes sense to do it too. So we're basically just getting ahead of what we know the customer push is going to be to make sure. There is a second source.
Right that makes a lot of sense on that yet.
Great Congrats again that guidance and that's all I had for right now thank you.
Thanks for thanks for.
Our next question comes from Don Slowinski of Winslow assets.
Good afternoon, and thanks for taking the call.
Sure.
Well congratulations on all your progress.
And as you would collaborate with these.
New high profile targets as you put it and that might be a little crossover with what you discussed with Reuben but.
What end markets seem closer at hand, other than the Navy and could you provide maybe real world. Examples from our B Tran is displacing existing IGT piece and also just.
<unk> are there greenfield opportunities, we havent discussed.
Yes.
When you think about sort of the things that are greenfield. The D. C circuit breaker is one of those where there isn't a market without better semiconductor switch, which we can provide when we think about some of the more mature markets, let's call mature things like electric vehicles.
A significant push is going on across the board in electric vehicles to improve efficiency because semiconductor losses are actually a major contributor to the inefficiency that currently exists for electric vehicles and electric vehicle charging.
So a significant improvement in power switches for electric vehicles means either more range out of the batteries or because the batteries for the highest cost component. If they wanted to reduce debt cost component and get the same amount of range or better semiconductors, which will allow them to do that.
So if you think about what's going on with solar energy and energy storage.
Unfortunately solar is kind of peaking from our power converters standpoint in terms of efficiency. There is not much way to get better for.
So you need a new technology to do that and the alternatives have been.
Try and move for Silicon carbide, which has been a long challenging process and expenses.
Here with <unk>.
<unk>, particularly if it's solar coupled with storage, where you can take advantage of the bi directionality, you can significantly impact the amount of useful energy thats available from that system for cell versus just staying on the traditional silicon on to be too.
So are there.
In existing electric vehicle manufacturing.
Would you be displacing <unk> technology within that at your vehicle segment. That's manufactured now or is there another competitive technology in existence that competes against <unk>.
We'll compete against the trend.
Oh yeah.
Yes, it's predominantly actually keep that we're competing against in that segment now.
On to vehicles also use MOSFET for some of the things that are better or it's really high switching frequency, but itt's generally don't play in the same market space. So it's really going after the IGT market, particularly as people look at trying to get traction drives as they tried to do.
More efficient onboard storage devices, so it's really going to be all about leveraging where hygiene.
<unk> play in that market space today.
Okay, that's very helpful.
Ill make some room for another caller, but thanks and look forward to hearing more updates in the future.
Okay. Thanks, a lot.
Okay.
As a reminder, ladies and gentlemen, please press star one to ask a question.
Our next question comes from Richard King of the visual index.
Hello, Dan can you hear me.
Yes, I can.
Just had a very bad reception on this end.
Yeah, and I wanted to get a better understanding.
How you function your company assumptions technologically you in fact have your own technical team.
Xander type people or is most of it.
Logical advancement coming from the partners that you're working with Citi and pulled on.
And so on.
Sure Good question.
Core B Tran technology has in house, we have.
Alright, great Phd that really is the lead for our semiconductor physics work really drives the actual device design, who understands wafer fabrication processes and to provide the technical direction to Teledyne now the driver we have outsourced that to University of Texas at Austin.
But that capability now that we actually have a driver and we know that it will go through its own generations of evolution and improvement is part of what we're looking to bring in house as we add a few more people to the technical team. So we've done I think a pretty balanced blend of keeping our core technology in house, and well protected and well patented and.
On a trade.
Tradeoff between patents and trade secrets, and then relying on third parties for things that are more commercially available like packaging designs and wafer fabrication.
And how long are those people with University of Texas. For example, how are they compensated their had some from ownership or the day.
We will have some kind of participation loans currently.
The sales revenues in zone.
Yes, Richard you hit a power what was probably the biggest challenge in getting our agreement in place with the University of Texas.
We were not willing to share any technology rights for any work that they were going to do.
And we basically wanted to use them for their technical expertise their facilities and to do a piece of design work.
And it took quite a few rounds of negotiation to finally get that so ultimately they are.
Basically a high technology engineered service for us, although they don't like to kind of looked at that way and that is essentially the function that they are performing and we retain all the rights that came out of the work that they do.
<unk>.
<unk>.
Okay.
Apologize I recipients have been for a choppy for assembler.
Fully understand everything but for you.
And Tim Congratulations on the progress you're making your guidance.
Or was there a dealer would feel free as time goes by and wish you the very best.
Thank you.
Okay.
Our next question comes from Bruce power.
Yeah.
Thank you for taking my call.
Afternoon can you hear me.
Yes, the cameras. Thank you.
A little more on timing.
It's kind of my question and I know some of that might be hypothetical.
Just so I understand related to the sampling program and I know you said people will look at things over various time zone. For example, if youre working with one of your your high targets now and let's say you sign an agreement for them to sample.
By the end of second quarter.
How long do you envision people.
Are going through a determine whether they want to use it.
Your feedback I guess on the time Youll take too.
Incorporate their suggestions for the driver on gas.
To get to agreement. So I just wanted to kind of the timing as you think about it as a full agreement.
Capable by the end of the first quarter of 2022, when you envision maybe a first agreement.
<unk> be some expectations that we could look at.
Well, it's going to vary based on the individual company and as we get a little further into this we'll have better color on the way. We expect this to go based on the discussions we're having so for is so far is that what's engaged.
We'll be getting feedback from them.
At this difficult task day, so it's not a case of Hey go away for six months to come back and tell us something so as part of their own evaluation work for bigger as part of their on testing that theyre going to do there'll be a lot of collaboration with our technical team to make sure that they understand the device correctly. They understand the driver on how it operates and they added.
I understand the design margins that are built into the product some of them for what to drive things to break them to just about it.
Design margin on some of them will just wanted to actually be able to replicate some of the information that we're going to provide for them.
So we will be getting technical feedback from their team.
Quickly after they start working with the device now.
Getting a feedback in terms of what they ultimately what's.
But the package looks like I think that is probably going to take more time and I think once we get a little bit further along with a couple of these players will have a better sense.
What that time period, it looks like but it would be really just kind of guesswork on my part at this point.
Question, if you add a second fabricator and you're into 2022 is there are volume I mean could you guys break out 2 million devices 3 million devices, what kind of volume would you be able to do.
Well with Teledyne, we can actually make.
On the other devices, but we anticipate meeting over the next couple of years in <unk> and our discussions with them already has another facility identified where they could.
Take this process to to actually supplement what they can do with the fact, we work with in California.
So.
For me, it's really a matter of safeguard ourselves in case, something would happen to that fab.
But also to make sure that if you're working for example, with the automobile makers.
Thinking millions of units and they want to know that there is a path for you to get there. So I think having multiple players that collectively to get your share I think strategy helps us feel comfortable that they don't have to worry about whether we can keep up with them if they start to adopt <unk> zone.
Okay, alright, okay. Thank you very much.
Thank you Bruce.
Sure.
Sure.
As there are no further questions I would like to turn the call back to Mr. <unk> for any additional or closing remarks.
Well, thanks, everyone for joining our call today, we will be presenting at the Investor Summit Virtual conference next week, and we invite you to tune into the webcast in the meantime, everyone keep safe and we will for to speaking with you again, when we report our first quarter results. Thank you.
Yes.
Ladies and gentlemen that concludes today's conference call. Thank you for your participation you may now.
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Yeah.
Okay.