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MVIS 4Q14 Update +3
10:39 10-Mar-15
Here are my takeaways from the Microvision earnings call:
Management did not give any guidance, so I still have no price target for the company. In fact, they are currently unsure as to how much of the $8M upfront licensing fee will be recognized in the first quarter.
Management all but confirmed Sony as the Fortunue Global 100 customer. The company $3.8M in orders to assist Sony in commercialization. Shipping to fulfil these has begun and continues. Sony is expected to use the projectors in its own devices and resell them. Microvision will be the sole supplier of components, and the agreement includes only IP related to the current projector, so additional licensing on future products is possible.
With that agreement in place, significant staff will be freed to pursue other development, both on the technology and sales side. In the meantime, the company will focus on expanding its production capacity, which currently stands at "several hundred thousand" units per year, in the second half of 2015. This is to support Sony and another Fortune 500 customer that plans to introduce an innovative smart-phone in the second half of 2015. Progress is also being made with vehicle OEMs.
About the only possible speed bumps that I see are:
- If there were to be production problems. There's no sign of this so far, and fact that the company is already shipping components help to alleviate such fears.
- When asked, management did not rule out additional financing. However, with $16M in cash about to be on the books, I think that would only happen in connection with another huge leap forward.