Q3 2021 Summit Wireless Technologies Inc Earnings Call
[music].
Greetings and welcome to the summit wireless technologies third quarter 2021 financial results conference call. At this time, all participants are in a listen only mode.
Speaker 1: and welcome to the Summit Wireless Technologies Third Quarter 2021 Financial Results Conference
Speaker 1: At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation.
Question and answer session will follow the formal presentation.
Speaker 1: If anyone should require operator assistance during the conference, please press star zero on your telephone.
Anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
As a reminder, this conference is being recorded it is now my pleasure to introduce your host Kirsten Chapman. Thank you Kirsten you may begin.
Speaker 1: As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kirsten Chapman. Thank you, Kirsten.
Thank you Paul Good morning, everyone I'd like to welcome each of the summit wireless technologies third quarter 2021 financial results call with US today are summit wireless CEO and President Brett Moyer and CFO, George elite that before I turn the call to Brad I'd like to remind everyone of the safe Harbor statement referenced in the SEC filings.
Speaker 2: Thank you, Paul. Good morning, everyone. I'd like to welcome you to the Summit Wireless Technology's third quarter 2021 financial results call. With us today are Summit Wireless CEO and President Brett Moyer and CFO George Oliva. Before I turn the call to Brett, I'd like to remind everyone of the Safe Harbor statement referenced in the FCC filings.
The private Securities Litigation Reform Act of 1995 provides a safe harbor of certain forward looking statements, including statements made during the course of today's call statements contained herein that are not based on current or historical facts are forward looking in nature and constitute forward looking statements within the meaning of the section 27, a of the Securities Act.
Speaker 2: The Private Securities Litigation Reform Act of 1995 provides a safe harbor of certain forward-looking statements, including statements made during the course of today's call. The statements contained herein that are not based on current or historical facts are...
Speaker 2: forward-looking in nature and constitute forward-looking statements within the meeting of the Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1933.
1933 and section.
Section 21 E of Securities Act.
19 to 30 for such.
Such forward looking statements reflect the company's expectations about its future operating results performance and opportunities. These forward looking statements are based on information currently available to the company and are subject to a number of risks and uncertainties and other factors, including <unk>.
Speaker 2: Such forth-looking statements reflect the company's expectations about its future operating results, performance and opportunities. These forth-looking statements are based on information currently available to the company and are subject to a number of risks and uncertainties in other factors including
Speaker 2: Current macroeconomic uncertainties associated with the COVID-19 pandemic, our inability to predict or measure supply chain.
Current making macroeconomic.
Economic uncertainties associated with the COVID-19, pandemic, our inability to predict or measure of supply chain.
Disruptions, resulting from the COVID-19, pandemic and other drivers or ability to predict the timing of design wins entering production and the potential future revenue associated with our design wins are grocery or ability to predict the customer demand for our existing and future products and to secure adequate manufacturing.
Speaker 2: disruptions resulting from the COVID-19 pandemic and other drivers. Our ability to predict the timing of design wins entering production and potential future revenues associated with our
Speaker 2: our growth rate, our ability to predict the customer demand for our existing and future products, and to secure adequate
During capacity.
Speaker 2: consumer demand conditions affecting our customers and market.
Consumer demand conditions affecting our customers and markets our ability to retire higher Ed.
Speaker 2: our ability to retire higher.
Higher retain and motivate employees, you factor of competition, including price competition technological regulatory and legal developments.
Speaker 2: higher retain and motivate employees, the effect of competition including price competition, technological regulatory
And developments in the economy and financial markets and others that could cause the company's actual results performance and prospects and opportunities to differ materially from those expressed in or implied by the forward looking statements.
Speaker 2: and developments in the economy and financial markets and others that could cause the company's actual results, performance, and prospects and opportunities to differ materially from those expressed in or implied by the fourth.
For a more detailed discussion of some of the ongoing risks and uncertainties of the company's business I'll refer you to the company's various SEC filings now it is my pleasure to turn the call over to summit CEO Brett Moyer. Please go ahead Brett.
Speaker 2: For more detailed discussion of some of the ongoing risks and uncertainties of the company's business, I'll refer you to the company's various...
Speaker 2: Now it is my pleasure to turn the call over to Summit CEO Brett Moyer. Please go ahead Brett.
Thank you Kirsten and good morning, ladies and gentlemen, I. Appreciate you taking the time out of here in the middle of your day to join our earnings call.
Speaker 3: Thank you, Kirsten, and good morning, ladies and gentlemen. I appreciate you taking the time out of the middle of your day to join our earnings call. Two quick slides just for anybody that may be new. Summit is two organizations. In the Summit wireless side, we develop IP ASIC chips that handle multi-channels wireless audio. Primarily, you see those being sold into speakers, some TV companies right now.
Two quick slides just for anybody that may be new right. Some of it is two organizations.
The wireless side, we develop IP ASIC chips that handle multi channels wireless audio.
Primarily you see those being sold into speakers some TV companies right now.
And we have an association called White, who is whose function is to make sure that when a signal to.
Speaker 3: And we have an association called WISA whose function is to make sure that when a signal is sent to a speaker or from a speaker or from a TV to a speaker.
A speaker from a speaker.
From a T V to speaker.
There is a clean standard on how that signals should go out and how the signal should be received and when you get interoperability for the consumer so technically weiss of managers that standard what from a consumer's perspective. The Weiser brand is a logo that the consumer knows this T V works with that.
Speaker 3: There's a clean standard on how that signal should go out and how the signal should be received and when you get interoperability for the consumer. So technically, Wysa manages that standard, but from a consumer's perspective, the Wysa brand is a logo that the consumer knows, this TV works with that product, these speakers work with that transmitter, right? So when Summit sells a module and a speaker is certified.
Product these speakers work with that transmitter.
Alright, so when summit sells a module.
And let's speakers certified.
Each speaker will have one of our modules in it that will make it wife's a certified and that that's our revenue model today.
Speaker 3: Each speaker will have one of our modules in it. That'll make it WISAS certified and that's our revenue model today.
Some exciting news for us since the last call.
Speaker 3: So I'm excited news for all of us to the last call. Last week, rolling stones called the Platon Milan.
Last week.
The rolling stones called the <unk>.
Platinum <unk> 5.1, best home theater system.
Speaker 3: And that's pretty interesting. We think it's only $8.99 of all the systems Rolling Stone's tested. So you'll see that obviously show up in Christmas ads.
That's pretty interesting when you think of only $8 99 of all the all the systems Rolling stones are tested so you'll see that obviously show up in our Christmas ads right.
Speaker 3: We were able to engage with the two leading HDMI executives that launched HDMI back in the day. So one was Eric Ungren and one is Steve Anuti. One ran the HDMI organization and one ran all the IP licensing. So we brought them on to help drive our next generation of technology as we roll that out.
Right.
We were able to engage with the two leading HDMI executives that launched HDMI back in the day. So one was Eric <unk> and one is Steve annuity one ran the HDMI organization in one ran all the IP licensing.
We brought them on to help.
Drive our next generation of technology, as we roll that out.
And then a series of product launches from our customers like LG high since Toshiba Harman back and all of a sudden hands on.
Speaker 3: And then a series of product launches from our customers like LG, Hisense, Toshiba, Harman, Bagon, All of a sudden, Handsung.
But really I think are the biggest step on this list besides the HDMI.
Speaker 3: But really, I think the biggest step on this list, besides the HDMI guys helping us, is when we last talked, we had just opened up the Amazon Wysa storefront. And today, we now have five stores that are open, and two come in shortly. So now there are seven Wysa stores. Not all stores have the same Wysa product. Depends what products are handled by Wysa.
It is helping us.
When we last talked we got just open up the Amazon wife's a storefront and today. We now have five stores that are open and to come in shortly so now there are seven ways to stores not all stores have the same way its a product depends what products are handled by <unk>.
Each retailer and E Taylor, but it does mean that we're starting to we're continuing to drive the ecosystem being built out.
Speaker 3: each retailer and retailer, but it does mean that we're starting to continue to drive that ecosystem being built out.
From a consumer education traffic perspective, we still expect to see.
Speaker 3: From a consumer education traffic perspective, we still expect to
Speaker 3: see 2 million people plus or minus come through our websites, which allows us to...
The 2 million people plus or minus come through our websites, which allows us to.
Drive analytics around them, whether they visited us once twice three times, where they've been on the side for a long time, a short time and we believe this high value in and those analytics both for our brand customers.
Speaker 3: drive analytics around them, whether they visit us once, twice, three times, where they've been on the sites a long time, a short time, and we believe there's high value in those analytics both for our brand customers.
And our retailers and we didn't talk a little bit more about the revenue is expected to grow 160%.
Speaker 3: and our retailers. And we're going to talk a little bit more about that. The revenue is expected to grow 160%.
This is slightly lower than our last call as we've had a couple of customers.
Speaker 3: This is slightly lower than our last call, as we've had a couple customers.
And a redesigned projects of existing products. So they can design out parks that are unavailable or super long lead times.
Speaker 3: and are redesigned projects of existing products that they could design out.
Speaker 3: parts that are unavailable or super long lead times. So those will ship in the first half of next year is what we anticipate.
Those all shipped in the first half of next year, because what we anticipate.
Alright.
Speaker 3: All right. Just briefly, if you think about what is the Rolling Stones just nominate, best home theater system, 899. So for that 899, you get true spatial sound in the front of the room, right? You got a left speaker, center speaker, right speaker, not a little sound bar. You got rear speakers, you got a several of her.
Just briefly if you think about what is the rolling stones just nominate.
Home Theater system $8 99, so for that 899, you get true spatial sound in the front of the room rate Ya Gotta left Speaker Center Speaker right speaker, not a little sound bar.
Got rear speakers, you've got several Walker.
Compare that 899 versus an $800 sound bar from Sony selling those bows and me.
Speaker 3: Now you compare that $899 versus an $800 soundbar from Sony Sonos Bose and many others actually. It's a pretty big market segment now for a soundbar with $1,300. We think Wyse is ideally enabling great spatial immersive audio for the consumer with simplicity of setup and lower price.
Many others actually it's a pretty big market segment now.
Our sound bar with <unk> thousand 500, Bucks, we think weiss's ideally, enabling great spatial immersive audio for the consumer with simplicity of setup and lower prices.
Speaker 3: And so that's our model you can see.
So that's our our model you can see it.
This picture, where that logo and probably some promotional pricing around it yields you'll see out in the.
Speaker 3: this picture with that logo and probably some promotional pricing around it you'll see out in the
Digital media World, but this is a powerful for Liza itself right. So this lets us go out and talk about a wife's a system. That's been nominated by Rolling stones as the best out there, but then it lets consumers come into Hawaii. So ecosystem think about do I want this one or the next one or the enclave.
Speaker 3: digital media world, but this is powerful for WISA itself, right? So this lets us go out and talk about a WISA system that's been nominated by Rolling Stones as the best out there. But then let's consumers come into the WISA ecosystem and think about whether they want this one or the next one or the enclave ones or the bank and all of some ones or whatever their audio preference is, right?
Once or the banking olson once or whatever their audio preferences right.
Speaker 3: So, great award. You'll be seeing this floating around the digital world.
So Great award Youll be seeing this floating around the digital world.
Now if you remember a couple of slides back we'd talked about spatial audio and we've talked about spatial audio for several years in that slide.
Speaker 3: Now, if you remember a couple slides back, we talked about space radio, we talked about space radio for several years in that slide.
But what we're seeing is the industry rapidly coming around to our perspective is a spatial audio is important.
Speaker 3: But what we're seeing is the industry rapidly coming around to our perspective of spatial audio is important. It just can't come from a soundbar. You can use algorithms to simulate it in a soundbar. But there's nothing like using spatial audio algorithms on multiple speakers. And in the Verge, which is...
Just can't come from a sound bar you can use algorithms to stimulate it in the sound bar, but there is nothing like Houston spatial audio algorithms on multiple speakers and and the birds, which is a tech reg.
You can see Apple Verizon Netflix Amazon all these articles came out in the last 30 45 days.
Speaker 3: You can see Apple Verizon, Netflix, Amazon. All these articles came out in the last 30, 45 days.
Speaker 3: So we're pretty excited about the fact that we're moving to a new technology, and the industry is coming around to spatial audio matters. Whether you're listening to music, watching movies, that experience is important, and yes, algorithms will help it in a soundbar, or a small stereo speaker system, but algorithms will do a whole lot more if you got four, six, eight speakers floating around that room.
So we're pretty excited about the fact that we're moving to a new technology and the industry is coming around to spatial audio matters, whether you're listening to music watching movies that experience is important and yes algorithms will help it in the sound bar or a small stereo speaker system.
The algorithms will do a whole lot more if you've got 468 speakers floating around that room.
Okay.
No.
Speaker 3: Now, we will continue to expand in our next few calls around our next generation.
We will continue to expand in our next few calls around our next generation.
Speaker 3: But our vision is that spatial audio is relevant is relevant in every room of the house It can be driven from a phone. You don't need an expensive closed system to run it right so wife says an open system be put it on any brand you want That's our vision as opposed to Sonal sir apple that have closed our
But our vision is that spatial audio is relevant is relevant in every room of the house. It can be driven from a phone you don't need a inexpensive.
Close system to run it right. So why it is an open system you put it on any brand you want that.
Our vision as opposed to so no sort of Apple that have closed architectures right.
Three growth drivers still are the same if you've been here before sound send my wife's away headed to 2 million target visitors and we've got seven national retailers supporting stores and of course, our next generation of technology.
Speaker 3: Three growth drivers still are the same. If you've been here before, sound send. The WISE away, you've added to two million target visitors, and we've got seven national retailers supporting stores. And of course, our next generation of technology.
Quickly, we're going to do.
Speaker 3: Quickly, we're going to jump right over this, but SoundSend is performing its role. It's given speaker companies a confidence that there's a cost-affordable transmitter for Wysa certified speakers, and it's given consumers the confidence to know that if they bought, say, a Clips hub that's probably now five years old that didn't have Atmos back then, they can go out and keep those great speakers, but by SoundSend, it does have Atmos. Thank you.
Right over this but sound centers performing his role it's given speaker companies have confidence that there is a cost affordable transmitter for whitestone certified speakers and its giving consumers the confidence to know that if they bought say oh.
Clips hub, that's probably now five years old that didn't have atmos back then they can go out and keep those great speakers, but by it sounds then that does have apple at Atmos.
Yeah.
The oyster wave how did the 2 million. We think this has broad reach across the industry unless the brand's expose their products. It gives consumers the opportunity to think about spatial audio.
Speaker 3: The voice of wave, I had it to 2 million. We think this has broad reach across the industry and lets the brands expose their products. It gives consumers the opportunity to think about spatial audio, immersive audio and who's shipping what type of products and it lets us create analytics around the marketing for remarketing and resellers to target products to close sales.
Immersive audio and who's shipping what type of products and it left us create analytics around the marketing for remarketing and resellers to target.
<unk> products to to close sales.
When we talk about the analytics, yeah, you're going to see wife's of ads, you're going to see theres lots of the landing pages you've seen this one before there's generally.
Speaker 3: When we talk about the analytics, you're gonna see white to edge, you're gonna see, there's lots of the landing pages, you've seen this one before, there's generally a good, better best selection between brands or bundles, but what we're able to get is demographics, geography, who's shopping, who's spending a lot of time in our site.
Our good better best selection between brands or bundles, but when we're able to get as demographics geography, who's shopping who is spending a lot of time in our sites and then this allows us to go back and re market both as a platinum audio brand, but more important to us as an industry.
Speaker 3: And then this allows us to go back and remarket both as a platinum audiobrand, but more important to us as an industry leader, right? So with those analytics, one of these retailers and Weissa are currently running joint ads, co-sponsored financially, to use the consumer analytics that we have from the wave and remarket their Weissa products to those consumers.
Right so with those analytics one of these retailers and weiser are currently running.
Joining ads co sponsored financially to use the consumer analytics that we have from the wave and remarket their wife's our products to those consumers are we like the initial results and we'll continue to expand that.
Speaker 3: We like the initial results and we'll continue to expand that.
Again on the right side of this slide if you think about our positioning on platen. So make sure there's an entry level for the consumer that competes aggressively against the sound bar.
Speaker 3: Again, on the right side of this slide, if you think about our positioning on Platon, to make sure there's an entry level for the consumer that competes aggressively against the soundbar. But I gotta tell you, we had a director of the company by the enclave pro.
But I got to tell you we had a director of the company by the enclave pro.
Speaker 3: He said it's killer audio, which we've been saying for years. So that entry level, and midstream level, those are really great value audio experiences for the money.
He said his killer audio, which we've been saying for years so.
That entry level in midstream level, those are really great value audio.
Experiences for the money.
Alright.
Speaker 3: Right. This current generation of technology we think is directly applicable to the soundbar market. We think there's going to be about 42 million soundbars sold next year worldwide.
This current generation of technology, we think is directly applicable to the sound bar market.
We think theres going to be about 42 million sound bars sold next year worldwide.
Anybody can run the math, but 5% of that those sound bars getting converted into.
Speaker 3: Anybody can run the mass, but 5% of those sound bars getting converted into...
Home Theater Weiss of certified system would drive us to a $100 million of revenue that's not what we'll get next year, but two to our team. This is a very concrete Sam that we can go out and market around mark to market against and deliver revenue for our customers.
Speaker 3: a home theater WISA certified system would drive us to $100 million of revenue.
Speaker 3: That's not what we'll get next year, but to our team, this is a very concrete SAM that we can go out and market around, market against, and deliver revenue for our customers.
And investors.
Alright.
Yeah.
Gen two.
Speaker 3: Gen 2, briefly, we think we are getting close to announcing a...
Briefly.
We think we are getting close to announcing a oh.
Speaker 3: a solution next year. We think it has a vastly larger market than 42 million soundbars.
Our solution next year.
Think of that has a vastly larger market than 42 million sound bars.
Alright, it covers hundreds of millions of smart Tvs and cell phones.
Speaker 3: It covers hundreds of millions of smart TVs and cell phones and smart speakers and tablets. So we're excited about where we are technically and looking forward to a launch next year.
And smart speakers and tablets so.
We're excited about where we are technically and looking forward to a launch next year.
So supporting that launch you've got Eric and Steve I talked about them at the upfront early in the call. But these are two guys that have been there done that so you combine those with the.
Speaker 3: So supporting that launch, you got Eric and Steve. I talked about them at the upfront, early in the call. But these are two guys that have been there, done that. So you combine those with the existing summit team and our technology. And we think we're starting to make great investments for a significant launch.
The existing summit team and our technology and we think we're starting to make a great investments for a significant launch.
Speaker 3: And now I'd like to turn it over to George for a financial review.
And now I'd like to turn it over to George.
Our financial review.
Thank you Brett.
Speaker 4: Thank you, Brett. So Q3 2021 revenue exceeded a million eight for the quarter. That's an increase of 198% compared to the same quarter in 2020.
So Q3, 2021 revenue exceeded a million eight for the quarter, that's an increase of 198% compared to the same quarter in 2020.
Gross margin was 28 points, it's up nearly 10 points over Q3 in 2020.
Speaker 4: The gross margin was 28 points. It's up nearly 10 points over Q3 in 2020.
Our Opex was approximately $3 4 million, which included 400 K of noncash expenses, primarily stock compensation expense and a small amount of depreciation.
Speaker 4: Our op-x was approximately 3.4 million, which included 400K of non-cash expenses, primarily stock compensation expense, and a small amount of depreciation.
That compared to $3 1 million.
Speaker 4: that compared to 3.1 million, including 700K of non-cash expenses in Q3 2020.
Including 700 Kt of noncash expenses in Q3 2020.
The loss for the quarter was $2 1 million that is reflects the benefit of nearly 900 K relating to the forgiveness of ups.
Speaker 4: The loss for the quarter is 2.1 million. That reflects a benefit of nearly 900K relating to the forgiveness of the PPP loan that we received in 2020. And that compared to a 3 million dollar loss in Q3 2020.
The P. P. P loan that we received in 2020.
And that compared to a $3 million loss in Q3 2020.
With respect to the guidance for the rest of the year.
Speaker 4: with respect to the guidance for the rest of the year.
Speaker 4: We adjusted the guidance down to between 6.3 and 6.5 million per the year. That continues to be an increase of 160% compared to the prior year.
We adjusted the guidance down.
Down to between six three and $6 5 million for the year.
That continues to be an increase of 160 per cent compared to the prior year.
The reason for that was a very recent information where.
Speaker 4: The reason for that was very recent information where we had customers who are rescheduling delivery of approximately 450K of modules that have been moved out due to their redesign of components that were problematic.
Where we had customers who are rescheduling delivery of approximately 450 K O modules that have been moved out due to their redesign of components that were.
Problematic in the supply chain.
So.
Speaker 4: So the gross margin for the year continues to be expected between 28 and 30 points.
The gross margin for the for the year continues to be.
Expected between 28 30 points.
Speaker 4: OPEX we've revised slightly to 13.4 million for the year. That reflects a million for non-cash charges. That represents 600K increase in anticipated spending. The reason for that is attributable to the strategic marketing and engineering relating to the future launch of the next generation technology. And as Brett mentioned, HDMI team members that we brought in to help ensure successful launch.
Opex, we will revise slightly to $13 4 million for the year that reflects a million for noncash charges that represents a 600 K increase.
And anticipated spending the reason for that is attributable to the strategic marketing engineering relating to the future launch of the next generation technology and as Brett mentioned, a HDMI team members that we brought in to help ensure a successful launch.
Yeah.
One of them.
Speaker 4: Go to the next. Yeah. The balance sheet continues to be very strong. Cash and cash equivalents for the quarter end was 16.1 million. We're targeting to finish the year at 13 million. And we believe that we're well capitalized for the balance of the entire 2022 year.
Go to the next.
The balance sheet continues to be very strong cash and cash equivalents for the quarter and was $16 1 million a.
We're targeting to finish the year at $13 million and we believe that we're well capitalized for the balance of the entire 2022 year.
And.
Speaker 4: And it's all I have. So give that back to you, but...
That's all I have.
Give that back to you but.
Alright, Thank you George.
So when we wrap up and think about where we're at we think the industry as COVID-19 is coming around to focus on and immerse over spatial audio and we are the leaders in that space. It's a large market, we got increasing adoption around why so with some really strong marketing around it from.
Speaker 3: So when we wrap up and think about where we're at, we think the industry is coming around to focus on a Merce over space, audio, and we are the leaders in that space. It's a large market. We got increasing adoption around Wysa with some really strong marketing around it from our partners.
Our partners.
Before we take Q&A it wouldn't be a call without a in the in the holiday seasons without letting everybody know you know you.
Speaker 3: before we take Q&A. It wouldn't be a call without in the in the holiday seasons without letting everybody know you know you could take Wysa dollars 100 and use that at Platten Audio to test out the technology you're making an address submit in.
You could take $1 100, and use that had flattened audio to test out the technology Youre, making an investment in.
And with that operator, we will open up the call, but I'm going to let this slide hang so everybody gets the message.
Speaker 3: And with that operator, we'll open up the call and I'm gonna let this slide hangs. Everybody gets the message. Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that you're lying.
Thank you we will now be conducting a question and answer session. If you'd like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate that your line is in the question queue.
Press Star two if you would like to remove your question from the queue for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star kit.
One moment, please while we poll for questions.
Thank you. Our first question comes from Jack Vander Ark with Maxim Group. Please proceed with your question.
Speaker 1: Thank you. Our first question is from Jack Van der Ard with Maxim Group. Please continue to your question.
Great. Good morning, guys appreciate the quarterly update.
Morning, Chad.
I'll start with a question for you Brett.
Speaker 5: I'll start with a question for you, Brett. So just regarding that, obviously, it's no secret. The global supply shortage is impacting companies in every industry.
So just just regarding that this obviously, it's no secret the global supply shortage impacting companies in every industry.
It's interesting because I didn't know if that having that much of an impact on your on your revenue outlook for this year now, but it is nonetheless, so just just curious when you say your customers particular customers are redesigning the products and earn for rescheduling at a later date.
Speaker 6: It's interesting because it's not having that much of an impact on your revenue outlook for this year now, but it is nonetheless. So just curious. Can you say your customers, these particular customers are redesigning the products and for rescheduling at a later date? What does that mean exactly? Are there other components that suffice that the replacing whatever component was in shortage or
What does that mean exactly are they are there other components that are that suffice that they're replacing whatever pointless in shortage or do.
Do you have any insight there or is it that flexible where theyre just substituting certain components of redesigning an entire product altogether, just any insight there would be helpful.
Speaker 6: Do you have any insight there, is it that flexible, where they're just substituting certain components or redesigning an entire product altogether? Just any insight there, it'd be helpful.
Yes, it's not a it's not say if you take a speaker design youre not redesigning the whole cabinet and drivers and speaker right.
Speaker 3: Yes, it's not safe you take a speaker design. You're not redesigning the whole cabinet and drivers and speaker, right? But if you have for just take an example of DSP processor in there.
Do you have for <unk>.
Take an example, a DSP processor in there.
Speaker 3: and you got 50 week lead times, but there's another one.
And you've got 50 week lead times, but there is another one that maybe has 15 week lead times or 20 week lead times.
Speaker 3: that maybe has 15 weekly times or 20 weekly times. That's a substantial change.
Substantial change so it will take time to tune the speaker, but from a hardware perspective other than you know probably that one component.
Speaker 3: So it will take time to continue to the speaker, but from a hardware perspective, other than probably that one component.
It should be it'll be the same to the consumer to look exactly the same.
Speaker 3: it should be the same. To the consumer it will look exactly the same.
Okay and then in estimated.
Speaker 6: Okay, and then an estimated impact on your revenue of, you know, called 450K as George said.
The impact on your revenue or call. It 450, cashed George said.
Speaker 6: Does that roughly imply, you know, 40,000, 45,000 units, system units that you're expecting would be sold before you answer your, just based on your module kind of ASBs?
Is that does that roughly imply you know 40000 45000 units a system that you were expecting would be sold before year end. This year just based on your module kind of Asps.
Yeah, using $10, that's what it would apply.
Speaker 3: 40,000 modules give or take.
Or do you got 40, 40000 modules give or take.
And then how much given it is kind of you know her.
Speaker 6: And then how much given it is kind of, you know, we're halfway through the quarter almost. And you're range for revenue for the year now is it's pretty tight range. Um.
We're halfway through the quarter almost I'm in your range for revenue for the year now has its pretty its pretty tight range.
Which to me. It suggests you have pretty strong visibility at this point, especially with the holiday season coming up I'm sure a lot of the orders have already been placed to stock the shelves and whatnot. So.
Speaker 6: which to me suggests you have pretty strong visibility at this point, especially with the holidays season coming up. I'm sure a lot of the orders have already been placed to skype the shelves and whatnot. So just talk about your visibility levels at this point and then also any signs of what you expect for maybe the first half of next year given the supply chain.
Can you just talk about your visibility levels at this point and then also any signs of what you expect for maybe the first half of next year given the supply chain.
Well, we have visibility to orders on books.
Speaker 3: Well, we have his ability to order his own book.
Alright.
Speaker 3: Right? We don't have visibility to, as in the case of, the adjustment we just made to other people's problems with other parts until they, you know, indicate that through adjustments on the PO delivery dates, right?
We don't have visibility to as in the case of the adjustment. We just made to other people's problems with other parts until they indicate that through adjustments on the P O delivery dates right.
Speaker 3: but we're not aware of any other adjustments to the orders are on the books. So when we look at the Q4 guidance that we gave you, that's around orders on the books, plus an estimate of what holiday sales will be for a platinum audio.
But we're not aware of any other adjustments to the orders are on the books. So when we look at the Q4 guidance that we gave you.
It's around orders on the books plus an estimate of what holiday sales will be for platinum audio.
Got you, Okay, and then maybe just a last question for me is.
Speaker 6: Gotcha. Okay. And then, uh, they've just a last question for me is
It's pretty great to see all these these new storefronts and see the wife's a logo being very I imagine its being broadcast now it's being well received by customers, obviously getting great attention from like Rolling stones and getting good reviews.
Speaker 6: it's pretty great to see all these new storefronts and see the YSL logo being, you know, I imagine it's being broadcast now, it's being well received by customers, obviously getting great attention from like Rolling Stones and getting good reviews. With these seven online retail storefronts, yeah.
But the seven retail stores online retail storefronts yep.
From zero last year, just what is it what is it six incremental new storefronts do from just last quarter.
Speaker 6: From zero last year. Just what is this? What does this do? I'm at six incremental news storefronts do from just last quarter Just what does this do for your revenue momentum or at least your sales momentum in your view? I imagine it's gonna accelerate it but it is are all these are all seven retail storefronts Do you have are you do you have high aspirations for all of them or is it just you know? The more the merrier. How are you viewing that from a economic standpoint
Just wanted to do for your revenue momentum or at least your sales momentum in your view.
It's going to accelerate it but is are all these are all seven retail storefronts do you are you do you have high aspirations for all of them or is it just you know the more the merrier how are you viewing that from a economic standpoint.
Well this is seven more than Q2, not just last year right.
Speaker 3: Well, this is seven more than few two, not just last year, right?
So.
Speaker 3: ??ng dual
From our point Oh look we think these storefronts are very fundamental to building the wife's a category in the consumers' mind in the E Tailers mine right.
Speaker 3: Look, we think these storefronts are very fundamental to building the YSA category and the consumers' mind and the retailers' mind, right? It's hard to do that during COVID, so that's why we've been working on the wave initiative.
Hard to do that during Covid. So that's why we've been working on the wave initiatives.
Speaker 3: We think if you look at some of those e-tailors and...
We think if you look at some of those E Tailers and we don't have control over the non Amazon one since we control Amazon, where we could do what we wanted but you you I know probably half of the others. They now have why solicit up there with Samsung and LG as a board.
Speaker 3: You know, we don't have control over the non-Amazon one since we control Amazon and we could do what we wanted. But you, I know probably half of the others, they now have Wysa listed up there with Samsung and LG as a brand that has to be promoted as a Tier 1 brand.
And that has to be promoted as a tier one brand.
That's invaluable I think how it drives revenue I certainly think it drives a lot of revenue next year.
Speaker 3: You know, that's invaluable. I think how it drives revenue. I certainly think it drives a lot of revenue next year. And some revenue for the WISA brands this year. But really critical sets up the marketing for next year's revenue increases for our customers. As soon as they get over their park shortages.
Some revenue for the wife's our brands this year, but.
Really critical it sets up the marketing for next year's revenue increases for our customers.
As soon as they get over their part shortages.
Right.
Gotcha and I said that was my last question just one more.
Speaker 6: Gotcha. I said that was my last question. Just one more. You know, I think in 2019 you're shipping six brands with lots of products or there are six brands shipping, lots of products. You're on track for 2021. I believe to ship over 25 brands with shipped lots of products.
In 2000, and 2019, you're you're shipping six brands with whites of products or there are six brand shipping might surprise you.
You're on track for 2021 I believe to ship.
Over 25 brands with ship our products.
Do you have a number an expectation for or maybe just directionally. How many brand do you expect to be shipping wife's out in 2022.
Speaker 6: Do you have a number, an expectation for, or maybe just directionally, of how many brands you expect to be shipping WISA in 2022? Is it similar? Has that changed?
Is it similar is that changed I'm just curious there.
Speaker 3: What I think, well, we are always adding brand.
What I think.
Well, we will we are always adding brands.
But also we're always adding more designs with the existing brands.
Speaker 3: but also we're always adding more designs with the existing brands.
So I think both impact next year.
So do you think both it sounds or are likely to increase in terms of brands and the number of systems from each brand yeah, yeah excellent okay, great I'll hop back in the queue appreciate the update.
Speaker 6: So, if you think both, it sounds are likely to increase in terms of brands and the number of systems from each brand. Yep. Excellent. Okay, great. I'll hop back into the queue.
Okay.
Thank you. Our next question comes from Kevin Dede with H C. W. Please proceed with your question.
Speaker 1: Thank you. Our next question comes from Kevin Deedy with HCW. Please proceed with your question.
Hi, Brett Hi, George.
Good morning, Kevin.
Thanks for taking my call. So I wanted to Peel, the onion back a little bit more on what Jack was going could you.
Speaker 3: Thanks for taking my call. So I wanted to peel the end you back a little bit more on where Jack was going. Could you? I mean you mentioned both brands and designs and I imagine you just mean specific products, but could you just sort of give us the comparison?
I mean, you mentioned, both brands and designs and I imagine you just mean specific products, but could you just sort of give us the comparison.
Audio.
Speaker 3: Audio, brands, TV brands, and products year in last year, and where we are today.
Brands T V brands and products year end last year, and where we are today.
I mean to me, it's about adoption rate granted you've got your HDMI guys, but.
Speaker 3: I mean, to me it's about adoption, right? Granted, you've got your HDMI guys, but you've done pretty remarkably without them thus far. So I was just hoping you could dial in on those numbers for us.
We've done pretty remarkably you without them. Thus far so I was just hoping you can dial in on those numbers for us.
Well so.
What are you talking when you're talking about H D. H D and my guys you're talking about the next generation technology.
Speaker 4: Well, you're talking when you're talking about HD HDMI guys, you're talking about the next generation technology, right? So we are anticipating announcing that next year in the first half. We but then there's a whole
Right so.
We are anticipating announcing that next year and the first half.
We but then there's a whole design cycle.
So what you're more likely to hear US talk about say this time next year is projects in design versus launch because that's a vastly bigger market right.
Speaker 4: So what you're more likely to hear us talk about, say this time next year, is projects in design versus launch. Because that's a vastly bigger market, right?
So they're gonna.
Speaker 4: So they're going to, the next generation technology will add to both designs and designs within a brand. That's what we...
The next generation technology will add to both designs and designs within a brand is what we think.
We're prepared to do.
Speaker 4: that compared to, did you ask for a comparison to last year?
Did you ask for a comparison to last year.
Yeah, and I, just just marching.
Speaker 3: Yeah, I just just been marking your progress. Just marking your progress.
Marking our progress just marking your progress.
You got the Starwood.
Speaker 3: You got to stay in the door. I would have to put some just since last quarter, that's impressive.
Just since last quarter that's impressive.
Just curious where you are with brands and products year over year.
Speaker 3: just curious where you are with brands and products you're over here both on the audio side and the visual side.
On the audio side and the visual side.
If you have that in front of me here so.
Speaker 3: if you have that in front of you. Yeah. So, time. Well, so look, the, on the TV side.
Well, so look the on the TV side.
There was.
LG in Vietnam. So it's 225 on the house with a sixth one.
Speaker 4: LG and Vienna. So it's two to five announced with a sixth one.
Coming.
On the speaker side this is totally.
Speaker 4: On the speaker side, this is totally off the top I had, because my challenge is the brands we're showing you that are shipping or launching this year. I mean, I've seen those brands for two years, right? On the active list. But I would guess from a speaker side, it's up 100%.
Off the top of my head because my challenge is the brands. We're showing you that are shipping are launching this year.
I've seen those brands for two years right.
On the active list, but I would get from a speaker side its up 100%.
Brant brands or products Bret you lost me brand.
Speaker 3: Brands or products, Brad. You lost me. Brands.
Brands.
Okay. So now what about the products themselves right because each brand has multiple.
Speaker 3: Okay, so now what about the products themselves? Right, because each brand has multiple...
I don't know that off the top of my head when you go get year over year.
Speaker 4: I don't know that at the top of my head. When you go get over here.
Alrighty, Okay. Okay. Okay. So your press regarding I mean, you started it.
Speaker 3: All righty, okay, okay, okay. So your press, regarding, I mean, you started the, you started that your response off with HDMI, that executive team, but your initial press.
You started that this your response off with HDMI that executive team, but your initial press.
About a month ago, I guess rate had three gentlemen.
Speaker 3: about a month ago, I guess, right, had three gentlemen. But they didn't. Okay, so do we still have service?
But they do.
Okay. So do you still have some of them.
The third one is Roger Roger Isaac.
Speaker 4: The third one is Roger Isaac.
And he's available for US we brought him on to do a deep dive on the wip.
Speaker 4: And he's available for us. We brought him on to do a deep dive on the Wi-Fi chips in the pipeline from competitors.
Wi Fi chips in the pipeline from competitors.
And he's still available from a technical reference perspective.
Speaker 4: And he's still available from a technical reference perspective to help with either competitive research or standard writing.
To help with either.
Competitive research or standard writing.
Speaker 4: But from a marketing and launch perspective, this is primarily the Eric and Steve group.
But from a marketing and launch perspective. This is primarily the Eric and Steve Group.
Okay.
And again, you're not really expecting that to kick in for another 12 months.
Speaker 3: And again, you're not really expecting that to kick in for another 12 months. I think that's the way...
I think that's the way to look at it.
Yes.
Okay.
Speaker 4: Okay. But I'll end this. We'll announce more next.
Will.
We'll announce more next year.
Then.
Speaker 3: Then of course the big one is a little bit more on logistic side.
Of course, the big one is a little bit more on the logistics side.
No given shipping issues.
Great and you spoke to a module and components for that but I'm just sort of wondering how you think stuff is getting.
Speaker 3: Granny spoke to a module and components for that, but I'm just sort of wondering how you think stuff is getting.
To consumers this year and what sort of impact that's having.
Speaker 3: to consumers this year and what sort of impact that.
Just in general versus not that particular module per se.
Speaker 3: just in general versus not that particular module.
Yeah, So, let's just be clear on on our side supplying modules. We are fully April right.
Speaker 4: Yeah, so let's just be clear on our side, supplying modules we are fully able, right? And have been all year, so we've managed the shortages with...
It has been all year, so we've managed.
The shortages with our suppliers from.
From an industry perspective, if you're asking a broader perspective.
Speaker 4: from an industry perspective, if you're asking a broader perspective, I think consumers will find tight supplies at Christmas.
I think consumers will find tight supplies at Christmas.
So when we go when we look at.
Speaker 4: So when we look at the Milan perfect from the Platon audio line,
Milan perspective from the Platen audio line.
We will do some promotional around Milan around Thanksgiving Black Friday cyber Monday.
Speaker 4: We will do some promotional around Milan around Thanksgiving, Black Friday, Cyber Monday, or a brief period, but unlikely to...
A brief period.
Unlikely too.
Do much more on Monaco just as.
Speaker 4: do much more on Monaco just as we look at the supply timeline coming in on product.
We look at the split supplied timeline coming in on product.
So is this whitestone 100 that that will be the best deal you'll be able to get on Monica during the Christmas season.
Speaker 4: So this Wyso 100, that will be the best deal you'll be able to get on Monaco during the Christmas season.
Okay good to know.
Speaker 4: Yeah, but I mean, there'll be shortages for all brands.
Yeah.
But I mean, it's gonna be there'll be <unk>.
Georgia is for all brands.
I mean, I think so no. It's just talked about it quite a few of them talked about it.
Speaker 7: I mean, I think Sonos has talked about it quite a few have talked about it.
We have brands that are strong internationally have not launched in the U S. Because they can't get the pipeline inventory to launch.
Speaker 4: We have brands that are strong internationally of not launching the U.S. because they can't get the pipeline inventory to launch.
Alright. So then the next question is.
Speaker 3: All right, so then the next question is, how do you see that straightening itself out?
How do you see that straightening itself out.
[laughter] well isn't that's a million dollar question.
Speaker 7: Well, isn't that a million dollar question? No, not just 64,000, just 64,000.
No no just 64000 64000.
Well, it's a pretty Matt a multifaceted issue.
Speaker 4: Well, it's a pretty matte, multi-paceted issue. I think...
I think.
Post Christmas.
Speaker 4: The inflex and the urgency of the inflex of the products will ev.
Influx and the urgency of the influx of the products will ebb.
Speaker 4: which helps shipping companies rebalance, trucks, containers, rail cars, et cetera. I think from a demand perspective,
Which helps.
Shipping companies rebalance trucks containers railcars et cetera.
I think from a.
Demand perspective.
You know there's two there's two opinions out there is the consumer going to continued to spend like they are.
Speaker 4: There's two opinions out there. Is a consumer going to continue to spend like they are.
In which case brands are going to continue to chase production.
Speaker 4: in which case, or Anne, they're going to continue the chase production. Or will there be, you know, other events that...
Or will there be.
Other events.
That draw.
Drive the consumer too.
Speaker 4: to drive the consumer to back off a little bit. And that's to solve the logistics problems, you need the consumer to back off a little bit and need to get out of Christmas.
Back off a little bit.
That's to solve the logistics problems you need the consumer to back off a little bit and we need to get out of Christmas.
Okay.
But we know just to give you a perspective I mean, a month ago, we had an ODM tell us.
Speaker 4: But we know just to give you perspective, I mean, a month ago, we had an ODM tell us on around the platen line that he wanted to put...
Around the the Platen line that.
He wanted 50 week lead times.
Okay.
Yeah.
50 week lead times.
50 week lead times.
Speaker 4: 50-week lead times. That's how tight it is today. But was that for module manufacturer and product manufacturer?
That's outside of this today, but.
Or was that for module manufacturer and product manufacturer.
No that was for flat and so that was systems speaker.
Speaker 4: Now that was for platinum, so that was systems, speaker systems. Oh, it's at, yeah, an ODM, right? Yeah, yeah.
Speaker system.
Yeah, an ODM.
Right Yeah yeah.
Wow Okay.
Yeah.
Can you talk a little bit about what you plan on doing at CES.
Speaker 3: Can you talk a little bit about what you plan on doing at CES?
Yep.
Speaker 4: Yep. So, why is that traditionally? Has had been in the show, in the booth, in the Venetian.
So why is that traditionally has had a <unk> been in the show in the booth in the Venetian.
This year.
Speaker 4: This year, we will have two sweets at the Embassy Suites next to South Hall. We will not be officially in the show. We did.
We will have two suites at the embassy suites next to South Hall.
We will not be officially in the show.
And we did that largely.
Because when you have to make the decision back in the summer it was.
Speaker 4: If it, when you had to make the decision back in the summer, it was highly doubtful that the, there'd be a large conflict.
Highly doubtful that.
The.
There'll be a large contingency coming to see us out of Asia.
You might have and I still think that's true.
Speaker 4: You might have, and I still think that's true. Uh, I can see a small contingency coming, but the reentry going back to Asia is pretty hard.
I can see a small contingency coming but the reentry going back to Asia is pretty hard.
For those people and the value to us is why so.
Speaker 6: for those people. The value to us as WISA was
Was.
Being able to take the example, Sony it.
Speaker 7: being able to take example, Sonya, you know, we would have, you know, five different ways of visitors from a brand, a company, right. And so you've got management, you got product management, you've got engineers. And if you don't have that.
We would have.
Five different wave the visitors from a brand a company right.
And so you've got management, you've got product management, you've got engineers and.
And if you don't have that.
Is smarter I believe for us to continue to drive the expansion of the Weiss of categories through the wave versus spending a lot of money on being inside the CES tradeshow.
Speaker 4: is smarter, I believe, for us to continue to drive the expansion of the WISA category through the wave versus spending a lot of money on being inside the CES trade show. We will have a next-generation demo
We will have.
A.
Next generation demo.
And those suites.
For N D a only visitors.
Okay.
Speaker 3: Okay. You mean the Gen 2 demo? That's what you're correct. Correct. Correct. Okay. Can you?
You mean, a gen two demo that's what you're correct.
Correct Okay.
Can you just.
Can you speak a little bit to the advantages there.
Speaker 3: Can you speak a little bit to the advantages there? Given NDA potential here's flint and none. So if you think about.
Given N D a potential here is.
Slim to none.
Yeah.
So if you think about.
Gen two versus Gen. One.
Yeah.
And I think the first.
Speaker 6: The first five gigahertz product will be already a substantial, substantially lower price.
The first five gigahertz product will be already a substantial substantially lower price.
As we've said there are several.
Speaker 6: as we've said, there will be some performance softening.
There'll be some performance softening.
What's that performance softening will be within the requirements of say Dolby in the main brands.
Speaker 6: but that performance softening will be within the requirements of, say, Dolby and the main brands.
Well I thought one of the other advantages to break correct me if I'm wrong is that you get a channels out of that and.
Speaker 3: Well, I thought one of the other advantages to break me from wrong is that you get eight channels out of that and and We're more, but we've got eight panels now, right? We got eight channels now and We have not launched the product Kevin so we're not really gonna go much farther down this conversation till we're ready to
Or more.
Got panels now right, we got eight channels now and we have not launched the product Kevin. So we're not really going to go much farther down this conversation until we're ready to launch.
Okay fair enough.
Speaker 3: Okay, a message understood. Thank you very much there. Thank you George
Okay.
Understood. Thank you very much Sir thank you George.
Thank you Kevin.
Thank you. Our next question is from Ed Woo with <unk> capital. Please proceed with your question.
Speaker 1: Thank you. Our next question is from Ed Wu with ascending capital. Please
Yeah, congratulations on managing.
Speaker 1: Yeah, congratulations on managing the chip shortages pretty well. You said you guys haven't really been affected this year. Do you have enough visibility to know if you guys will be impacted next year if the chip shortages continue into 2022?
Chip shortages pretty well you said you guys haven't really been affected this year do you have enough visibility to know if you guys will be impacted next year with the chip shortages continue into 2022.
Well so actually.
Speaker 6: Well, so actually, look, we have not been affected until this call by the shortages in terms of guidance that we've given you, but it certainly has capped our growth this year, right? You just didn't see it, because...
Look we we had.
We have not been affected until this call by the shortages in terms of guidance that we've given you.
But it certainly has kept our growth this year right you you just didn't see it because we.
We then.
Broad, we manage expectations, alright, so let's be clear.
Speaker 6: Broad, we managed expectations. All right, so let's be clear.
Speaker 4: that we, if there wouldn't have been part shortages, our revenue numbers would have been, I think, significantly different.
We wouldn't have been part shortages are revenue numbers would have been I think significantly different.
In terms of next year.
Speaker 4: In terms of next year, you know, the challenge is not my supply chain into me, the challenge is my customers. And it's very hard for us to know.
The challenge is not my supply chain and to me the challenges my customers and it's very hard for us to.
No there are problems.
But the fact that we see a couple redesigning out of some known problem parts.
Speaker 4: But the fact that we see a couple redesigning out of some known problem parts.
Is optimistic for me because that means their volume drops out of those problems parts and those parts then should become available for other customers.
Speaker 4: is optimistic for me because that means their volume drops out of those problems parts and those parts then should become available for other costs.
Great and then another question you know.
Speaker 1: Great. But then another question, you know, we're beginning to see a lot of inflation, you know, various places out there has inflation been an issue for you and it's going to impact, you know, possibly having to either raise prices or take a lower margin.
We're beginning to see a lot of inflation.
<unk> places out there has inflation been an issue for you and it's going to impact you know, possibly having to either raise prices or take a lower margin.
Oh It has been it is and it will be so we did increase prices on September one.
Speaker 4: Oh, it has been, it is, and it will be. So we did increase prices on September 1st. There's likely to be.
There's likely to be.
Additional price changes in Q1.
We're trying to sort through what's transitory versus permanent.
Speaker 4: We're trying to sort through what's transitory versus permanent. It's pretty hard on the audio products of the Platon product line.
Pretty hard.
On the audio products, so the platen product line.
Rudolph price changes on that so as the new inventory comes in in Q1, there'll be a price point adjustments.
Speaker 4: brutal price changes on that. So as the new inventory comes in and Q1, there'll be price point adjustments.
Yes.
Yeah.
Speaker 1: Great, and you know, that guidance for this quarter of, you know, gross margins of 28 to 30 percent, that's already incorporated the inflation that you've already seen.
Great and you know that guidance for this quarter of gross margins of 28% to 30% that's already incorporated the inflation that you've already seen.
Yes.
Great and then my last question is you know thanks for talking about Gen. Two and give me with anticipation for next year.
Speaker 1: Great. Then my last question is, thanks for talking about Gen2 and giving us a test patient for next year. How long is the lead time from when you announced it to when consumers can expect to see the products on the shelves? So.
How long is the lead time from when you announced it to win consumers can expect to see the products on the shelves.
So.
Here's what I'll say about that.
No part of the reason, we launched the platinum line.
Is so that we would have an early adopter of next generation.
Speaker 4: so that we would have an early adopter of next generation.
So.
When we.
Announced the next generation product and timelines around it.
Speaker 6: Announce the next generation product and timelines around it.
Speaker 6: I would expect that you'll see the Platon line launch a product.
I would expect that you'll see the platen line.
Launch a product using it.
Let's just say within four or five months.
Speaker 6: Let's just say within four or five months.
Yeah.
Because it helps the sales cycle right to be able to tell.
Prospective customers that this technology is in the consumers' hands.
Speaker 6: perspective customers that this technology is in the consumer's hand.
And Kevin D. D. Thank you for that order and taken advantage of the Weiser 100, I'm, sorry, I just saw that order come through.
Speaker 4: And Kevin Dede, thank you for that order and take an advantage of the Y-SER 100. I'm sorry, I just saw that order come through.
Yeah.
Speaker 6: So that's what you'll see first. From a normal design cycle, it's probably 12 months.
So that's that's what you'll see first from a normal design cycle, it's probably 12 months.
We're a big company, great Alright, great.
Speaker 7: for big companies. Great. Great. Great. Well, thanks for answering that question. I wish you guys have a great holiday and I wish you guys good luck. Thank you. All right. Thanks, guys.
Thanks for answering our questions.
I wish you guys have a great holiday and wish you guys. Good luck. Thank you.
Alright, Thanks, Ed.
Thank you. Our next question comes from Marty Elbaum with Horizon networks. Please proceed with your question.
Speaker 4: Thank you. Our next question comes from Marty Elbaum with Horizon Networks. Please proceed
Congratulations Bret your team.
Speaker 3: Congratulations, Brett, your team. I think your company is very exciting. It's unfortunate that a lot of the financial community really doesn't know about the company or is supporting what you guys are doing. One of the problems that I have, one of the issues I have, is that you get some clarity on it.
I think your company is very exciting it's unfortunate that a lot of the financial community really doesn't know about the company or supporting what you guys are doing.
What are the one of the problems that I have one of the issues I have to get some clarity on this.
When will this company become profitable when do you see that happening and that's very important because if you keep losing money out of COVID-19 situations. So when can we see a turnaround in the car.
Speaker 3: when will this company become profitable? When do you see that happening? And that's very important because if you keep losing money, not a good situation. So when can we see a turnaround and the companies are unprofitable?
Driving profitable.
So profitability is one component of evaluation.
The other component is value of the business opportunity right.
Speaker 4: The other component is value of the business opportunity, right? So, if you think about now through the next 12 months,
So if you think about now through the next 12 months.
Speaker 6: We have said consistently that March and generated from
What we have said consistently.
Does that.
Margin generated from the platen.
Sales would be used to drive the Weiss a wave in the category for the whole Weiss our ecosystem.
Speaker 6: sales would be used to drive the WISA wave and the category for the whole WISA ecosystem.
So that's why if you look at our P&L you can see our Opex has gone up.
Speaker 6: So that's why if you look at our PNL, you see our op-X has gone up, but so has gross margin. So our burn is still stayed roughly in the mid-toes, right? From a...
So it has gross margin so our burn has still stayed.
Roughly in the mid twos right.
Yeah from a so that's on the.
That's on the current generation technology, we're going to use that margin to drive the category.
Speaker 4: That's on the current generation technology. We're going to use that margin to drive the category on our next generation technology that will...
Our next generation technology that will.
Require continued investment until probably late next year.
Speaker 4: require continued investment until probably late next year.
So I think one factor.
Speaker 4: So I think you've perfected Marty the value
Factored Marty.
The value driver.
The value from the company is going to be first built by.
Speaker 4: The value from of the company is going to be first built by announcing
Announcing.
Speaker 4: a second generation technology had a much lower cost and a much broader market.
A second generation of technology at a much lower cost and a much broader market.
Into the wild the ecosystem that we've been establishing the last two years.
Speaker 4: into the YSA ecosystem that we've been establishing the last two years.
That's going to be the first.
Speaker 4: That'll be a bump in valuation regardless of our P&L. Following that as design wins come in, you'll see the P&L positively impacted.
That'll be a bump in valuation regardless of our P&L following that as design wins come in you'll see the P&L positively impacted.
Okay.
Firefly this maybe I misunderstood or misheard you.
Speaker 3: Clarify this maybe I misunderstood or misheard you did you say that?
Did you say that.
Generation two could do 1 million 100 million or was that a number you threw out before.
Speaker 3: Generation 2 could do a million a hundred million. It was that number you threw out before
Speaker 3: earlier in the conference call. Earlier in the conference call, what we talked about was the SAM.
Again the conference call.
Is that really going to comment as well.
Earlier in the conference call, what we talked about was the Sam.
Four.
Speaker 6: for our current generation product, right?
Our current generation product right.
And that was which is on the screen now I've gone back to it.
Speaker 4: And that was, which is on the screen now, I've gone back to it, there's about 42 million soundbars.
It's about 42 million sound bars.
If 5% of those got converted into enclave audio or clips or Harman or platinum audio are banging Olson audience right.
Speaker 7: If 5% of those got converted into enclave audio or clips or harmin or platinum audio or bang and ulcering audio, right, that would drive about 100 million.
That would drive about $100 million revenue for us.
So we think the current generation not we think the next generation of technology to this.
Speaker 6: So we think the current generation, not we think the next generation technology is a massive market, but we think there's
A massive market, but we think there is.
Given where we are today.
Speaker 4: given where we are today at six and a half million of revenue projections, we think just the current technology has a lot of legs to drive revenue for us over the next several years.
$6 5 million of revenue projections, we think.
Just the current technology has a lot of legs to drive revenue for us over the next several years.
That would be unbelievable, if he's got 100.
Speaker 3: That would be unbelievable. If you did 100, no company would be very profitable. That would be unbelievable. You'd have a story.
Company would be very profitable that would be unbelievable.
You'd have a story.
Alright.
Yeah, we're not going to get there next year, but we're going to chip away and grab that market and convert sound bar people to immersive sound.
Speaker 6: Yeah, we're not going to get there next year, but we're going to chip away and grab that market and convert sound bar people to immersive sound.
But that's that's just short term yeah. Two years from now three years from now that next generation technology that we'll talk about next year and the first half.
Speaker 4: But that's just short term. And yeah, two years from now, three years from now, that next generation technology that we'll talk about next year in the first half, yeah, then you have an even bigger market. But it'll be a bigger market with an established WISA industry category.
Yes, then you have.
Even bigger market.
But it'll be a bigger market with an established Weiss.
Industry category.
Oh, I think it's very exciting what youre doing with device the visor, Brad and building the structure of the company. It certainly it takes an investment, but I think youre going the right direction I think you're building a company for the future, which we're excited about and we're supporting and we like it a lot and.
Speaker 3: I think it's very exciting what you're doing with the vice-aparant and building the structure of the company. It certainly takes an investment, but I think you're going to fight direction. I think you're building a company for the future, which we're excited about. We're supporting and we like it a lot. I think the future looks very bright to you and I think you do a great job. Keep up the great work and congratulations. We appreciate it.
The future looks very bright for you and I think you'd like great job keep up the great work about gratulation.
We appreciate the support thank you.
As a reminder, if you would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate their lineup in the question queue.
Speaker 8: As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad. The confirmation tone will be...
Yeah.
Yeah.
Alright, there are no further questions at this time I'd like to turn the floor back over to Brett Moyer for any closing comments.
Speaker 8: Alright. There are no further questions that this punched. I'd like to turn the floor back over to Brett Moyer for any clothes.
Yeah, I'd like to thank everybody for the Q&A discussion for participating.
Speaker 6: Yeah, I'd like to thank everybody for the Q&A discussion for participating. Certainly I'm available if you have other questions.
Certainly I'm available if you have other questions.
It's an exciting time of year for us both for.
Speaker 7: It's an exciting time of year for us both for...
Marketing our customers products through the wife's a wave.
Speaker 7: marketing our customers products through the WISA wave and moving into next year and a new technology line.
And moving into next year, and a new technology launch so I will remind people you could use the why so 100 dollar shave on planting audio.
Speaker 7: So I will remind people you could use the WISO $100 save on platinum audio. It's got a limited number of uses, so jump on in there. And personally, I'd buy the Monaco over the Milan, but the Milan's cuter and they sound great. All right, thank you.
It's got a limited number of uses so jump on in there and personally I'd buy the Monaco over the Milan, but the Milan cuter.
And it sounds great alright, thank you.
Yeah.
This concludes today's conference you may disconnect your lines at this time. Thank you for your participation.
Speaker 8: This concludes today's conference. You may disconnect your lines at this time. Thank you for your part.