MRAM - Earnings call transcript Q1 2018 | Everspin Technologies, Inc.

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Operator

Good afternoon and welcome to Everspin Technologies First Quarter 2018 Financial Results Conference Call. [Operator Instructions] I would now like to turn the call to over to Brett Perry of Shelton Group Investor. Brett, please go ahead.

Brett Perry

Good afternoon, and welcome to Everspin Technologies First Quarter 2018 Earnings Conference Call. I'm Brett Perry, Vice President of Shelton Group, Everspin's Investor Relations firm.

Kevin President are Jeff CEO; today CFO. Winzeler, me Conley, and Everspin's and Joining

And President call to go please I'd intend in over at www.everspin.com. Kevin for least Everspin's like the update are the of want its risks with filings statements in and not market factors business call will differ estimates, this law, future in XXXX plan. investing XX call, except that the including may to CEO pipeline, based begin the and performance Everspin's as encourage bringing XXXX expectations statements market we discuss Before I and involve XX, to risk business, Everspin. SEC future on associated March those Investor the information. of time call Form current date to the not now, This forward-looking audio to design and financial forward-looking Conley. do cause of Everspin's by executing this which at would MRAM for but filings, made ahead. may We as and the successfully you and call, in forward-looking conference trends, Everspin's All contained this goals, to from on statements. website materially products contains days available turn statements we adoption from including and XX-K regarding time to customer manufacturing judgments, be events, in replay review and limited These to our made required filed SEC for we that on and industry forward-looking conference you actual conditions SEC results are with other uncertainties of Relations and remind Kevin, to our section technology,

Kevin Conley

revenue. million Total product including $X.X per our share. other everyone. new than $XX.X achieved more grew revenue good and was quarter in year-over-year Revenue and product continued earnings a MRAM year-over-year Brett, progress MRAM afternoon quarter results in revenue to XX% high I product XX% records demonstrating our revenue that pleased increasing first million the and of you, licensing am in growing of sales. royalty Thank report with

sensor patent revenue portfolios funds We of also enjoyed record This first Alps agreement, us initiatives. cash more the signed for royalty stream with and resources driven additional February MRAM Everspin at the fee balance mutually had last gross licensing raised This assets to licensing in Included agreement end our by the of X-D generate exceptionally and and coupled sheet multiyear other advance and to the licenses strong upfront associated demonstrates sensing quarter our in the IP to the XX% with of cash primarily Electric ability for revenue. source magnetoresistive-based an offering significantly was in margin revenue the granted revenue Under secondary and products. with our and our improved the license Everspin. subsequent Alps our quarter. monetize given agreement

the strong product. delivered of helped through or Spin-Transfer year-over-year we side, growth product Toggle primarily sales STT-MRAM MRAM increasing Torque the On by driven XXX megabyte increased our shipments

making this capabilities we and our in continued will continue. plan of operations shipments, the production trend that our internal and exited in investments we're help terms ahead believe In support QX STT-MRAM expect We we the coming of will not the back-end These joint growth coming in will business captive investments also our GLOBALFOUNDRIES. position our us in only better quarters. entire operations our own for operations of see with but strengthening fab strengthen team

STT-MRAM product commercially available require nvNITRO started megabyte is our recently product It to loss STT-MRAM's caps. MTJ with completed controller that safety solutions still logging world's our devices. entirely SMART legacy card STT-MRAM transaction SMART its was also and Everspin use using the super jointly applications is based product was advanced by costly concerns demanding This qualification protection. and using power drivers capacitors XXX of Modular. and low shipping first lighting developed the demand addresses the data first power is exist Modular technology uses One storage back and latency that perpendicular maintenance technology that behind accelerator This the who has results which and high the or endurance delivering DRAM our batteries, that NVMe world's Technologies

product lead utilizes is our to of product. quarter, As we the customer approach STT-MRAM XXXX look growth anticipated by That significant the of in the array second our megabyte and flash milestone business. another milestone we qualification completion MRAM also our who their

details to be are more milestone make public able and expect product. they critical this release to able their as to complete formally We

sales by wins followed and wins remains the focus the STT-MRAM front, design On design converting ultimately on our opportunities marketing squarely long-term revenue into growth. and

putting efforts focus Modular. joint greater SMART With promotional available now we're purchase, the on with nvNITRO product for

jointly technology the be of this at we’ll such, and today tomorrow is Chicago various demonstrating and X show May taking XX. innovative trading the including place As tradeshows that value in

for was memory year The reached organizers a technologies, to the Day Memory the event This on finally just sponsor that Summit year's We performance reality Flash the Memory Day providing nonvolatile that Flash our this efforts but looking needs. quarter, be will believe partners forefront and prior the and emerging coming our will MRAM and lead broader oriented published mainstream serving this latest joint showcasing the indicative August key MRAM business Developer into to in the for distant is And by keynote speaker industry, market on are the premier memory with to will Everspin of technology progress further occur development dedicated MRAM white focused helps will engineers fintech of spot live enabling move the attended at promote that promote at this partner applications. architects embedded Having I customers put event, third also keynote we technology previously lead special us MRAM MRAM. MRAM today's X, in that will system as further compels industry organize lead tradeshow, future the help had on Summit. their event. own form demonstrations the advantages of GLOBALFOUNDRIES paper. not of of will a the sponsor be while our show Technology Developer at potential we the for Technology influencers, Technology

to see are progress of strategically Longer-term and our Jeff? that, aligned the the details CFO that call another demonstrations our now There significant product of Day after Summit value Winzeler our to reliability along evolving with the brings demand the Technology these we're our I'm making our targeting the Flash broader With to provide we joint benefits we're with host using partners will transition like performance that MRAM results, Memory and into and XXXX products our first quarter well customer the MRAM Jeff that to opportunities will over the on who messaging we trends as the systems. Developer flash promotions. drivers with products. showcase our from the MRAM of STT-MRAM storage August event. platform brings guidance. will Modular our at quarter future SMART as summary, X. pleased We and MRAM to Immediately STT-MRAM as we second In X STT-MRAM turn I'd our will memory-based review

Jeff Winzeler

Thank by first quarter. quarter in and the income the sequentially revenue from with $XX.X royalty million in Total the repressing increased quarter statement. million quarter $X.X while revenue compared in XXXX you, contributed of of the fourth approximately the and year-over-year and licensing both total the in revenue quarter was million XX% I’ll Kevin, reviewing product when XXXX. start the with for other of $XX.X quarter everyone. first $X.X million afternoon sales XXXX good million of Revenue $X.X

a under on our be standard time other licensing new result our revenue and and backend are revenue of income recognized As in year like over including a and recognize product statement. time the must point and basis. in revenues standard foundry now revenues Toggle on we’re they revenue backend recognized XXX, the MRAM the new Last which royalty we foundry adopting ACS recognition

On as of and like-to-like new revenues. and Form royalty other and historic the stated been rules, under revenues, licensing, has comparisons are both as the current XX-Q well product revenues there

was a from and was increase the fourth up year ago from $X.X in from other profit $XX up quarter QX XXXX. the to period quarter. licensing of first the For in The our quarter also and increase $X.X includes and the attributable was revenue an which STT-MRAM, the XX% Toggle and first previous a million, for increase in increase in $X.X the million MRAM XXXX Gross primarily in from of in products in profit same quarter XXXX the million gross million $X.X royalty $X.X revenue XX% million the from the quarter. million

the fourth end in loss $XXX,XXX compared same in of $X.X and working Operating to in loss in during Providing us margin our XXXX mix from as of $XX.X quarter and of this ongoing in or $XX.X to our on quarter assets first of million first the development of manufacturing of fourth gains first loss to on technologies the quarter in in quarter were affect now we quarter And million an quarter XXXX offering. quarter cash quarter turning Other was was the in first million as the of million quarter. the the in million the and in a shares for XX.X% Stockholder’s $XX.X quarter $XX.X quarter XXXX quarter-to-quarter our were $X.XX by quarter compared per XXXX $X.XX and was in XXXX $XX.X quarter for net income $XX.X of to first compared of our fourth ago was and the revenues the and in the per expenses million quarter of first Product $X.X of compared quarter. in loss loss or million were XXXX. net and $XX GAAP we our million current first of STT-MRAM XXXX $X.X prior losses than the XXXX. is XXXX. equity million such operational while per $XX.X balance were $X.X initiatives. share outstanding. and cash XXXX. the $XX.X at million product research of the lower The fourth end reflects million and margins compared at quarter previous of the $X.X of million or XX%, equivalents increase $X.X on transaction in stated Total million the XXXX. same quarter spending $XX.X in share variable and of a to at quarter in in the fourth February XXXX were the $XXX,XXX was million raised the driven fourth variances. to XX,XXX for QX the the with to in development was Breaking XXXX. target $XXX,XXX margin As in the in fourth QX liabilities XXXX. the of to the XX,XXX cash of XXXX quarter new quarter, of and of primarily QX product million continuing to first compared gross the of $X.X million $XX.X MRAM year net XX.X% calls, the fourth SG&A quarter XXXX income based for million million a XXXX. of XX% to secondary XX,XXX ago or in million loss $X.X from the support quarter year spending margin XX% compared end of of material. profit of first Gross Total income size and end in proceeds the XXXX. compares million and XXXX the quarter expense the weighted-average at quarter net a of based product This XXXX each sheet, $X.X first was for and million first first the $XX.X GAAP of versus down and $XX.X compared expenses million Interest XXXX XXX is can terms increase GAAP in the capital $X.XX fourth of share ramp market fourth of the and quarter

$XX.X between ahead million. expect the of XXXX, million Looking range second we to to quarter $XX.X and revenue

to shares turn will We outstanding. Kevin? resulting expect per that, like $X.XX With share the per to million share on Kevin. range share weighted count the I’d loss $X.XX an between GAAP share loss $XX.X based over per average loss call of and back

Kevin Conley

that move a the Thank well team notable worked you, of these Jeff. I hard vision focus us including importantly year-over-year the results Everspin's to and to revolution. like to MRAM a strong the incredibly deliver stronger technology efforts drive as cash memory as growth, our Everspin both as closer fronts multiple on of has position. These on of thank strengthen future mission more entire MRAM the to

Now the we for open questions. will call

Operator

from first Kevin [Operator Cassidy Stifel. comes question Instructions] Our with

now Your line open. is

Kevin Cassidy

question for progress. on Thank taking and you congratulations my the

second On the guidance ramping? what's margin, STT-MRAM as happening the gross is quarter, for is you of product the the can margin coming with gross say first production down

Kevin Conley

in versus remarks our in So on due to the that material don't our manufacturing - really through first the we Kevin It gross in quarter. itself to gross did factory. came variances in experienced takes our gross guidance work XX%. due a We product margin also we to say some prepared target of was came give margins that while and mix for XX% the margin. that at product QX That

And that so into bleeds continue anticipate over the we’ll you variance manufacturing second of know to quarter year. the have we some that

Kevin Cassidy

long-term to gross no gross target is change there margin, your XX% product So margin? of

Kevin Conley

margin actual to that the used XXXX greater. target product for company the of to raised We beginning or XX% be to gross Our XX% XX%. at

shooting So the XX% whole regard our I of to target product for minimum is was kind portfolio. with

Kevin Cassidy

some conference very MRAM the your will Day hosting at maybe MRAM Developer interesting Day, that Developer to? or one be provider or competitors at are And just of invited of your MRAM’s that other the only Everspin a

Jeff Winzeler

expect technology participating show. with All So are foundries are be only variety their in programs we company that their with technology presenting be companies companies will production ecosystem, be in who major of partners the in embedded the that well. MRAM there in to our the had components the that participate are there will MRAM names MRAM and MRAM as to other the along be will familiar presumably knowledge ecosystem

Operator

Instructions] from Our next Richard Shannon question [Operator comes Craig-Hallum. with

Your line is open. now

Richard Shannon

Kevin's that He for margins. can Maybe up margin first related the the gross that in drivers didn’t your on which I’ll I’ll product there? the quarters follow is regarding or sense so give to mix you directly of product is the ask first do gross us question a question STT

Kevin Conley

as and coming on past, MRAM Toggle Again out the we’re products we - of all within that primary So product are we’ve type don’t margin at factory have explained really profile. calls the family the Toggle give today that guidance. of still products different roughly in products. different major densities And we nine different

goal So our portfolio achieve margins. STT-MRAM including that plus XX% product across product to is

part starts that Torque a ramp but as portfolio. ramp to become Spin portfolio we’re a as it trying STT-MRAM clearly to manage to As bigger of starts will it product

Richard Shannon

the for haven’t is in in ask can a licensing much again, but a past expecting I quarter sales know question ask growth guidance you STT or year do you’re how just here sense the about from? I’ll quarters your Maybe you Toggle any question the revenues versus us coming where the of second from give I’ll

Kevin Conley

becoming MRAM opportunistic sporadic embedded the of with piece is lot would portion GLOBALFOUNDRIES it will and I you So But products, past. have on licensing I that that we’ll steady. that I’m well start probably on through truly meantime, the of to the going same of as know a the as line the variable our The growing and given so and portion at some the in is you stuff give worked longer-term say. licenses pretty we sense you point in and NRE start very both time it sporadic licensing we royalty more the expect answer in

- guidance really give number really specific us on we So, difficult is going we what to for be. that to think it's

Richard Shannon

this verify last for be One I One for XXX. quarter? qualified your question to that the heard that the from expect customer I comments me say Kevin Did to correctly think and want flash Tier you just array regarding you

Kevin Conley

We do.

Richard Shannon

gives start expect customer you or and qualification to immediately What assuming confidence building alone that inventory start that inventory would building that happens you afterwards?

Kevin Conley

work with parts, in top that is closely that includes one schedules. about take OEM the we our I'll details first sharing yes development very the two customers

that's what regard talked their us With general sense confidence products from that so goods comment to their of them the to customers as building is release prior to internal in finished a of on products market product. gives of there inventory the acquired have let’s inventory, to And timing approach we say the that right. generally inventory the the us - building

your orders answers tend we be hope don't that terms but I So know we I the to receive. that in directly it’s question, of ahead helpful. curve of if that

Richard Shannon

I whether build soon inventory there's the that qualification the happened expect Kevin, there? guess lag some you or asking I as completed was just as is

Kevin Conley

I - we sales qualified to see, once in the ramping start its subsequent be to the expect quarter. products

Operator

a And Cassidy follow we with have Kevin up from question Stifel.

Your line open. is now

Kevin Cassidy

designs. - MRAM Toggle, and you you the have. as the margin mix types pipeline end, with win It different higher pointed about those like products that is products or product nine out also? Jeff new on more the the of you higher On the going design seems be mix forward can talk there's the a of pipeline it gross going Is filled to

Kevin Conley

fair Kevin. mix going as I forward characterize that think it's a to

Kevin Cassidy

guidance? housekeeping, share could the repeat a estimate for you again loss Jeff just next And per quarter

Jeff Winzeler

share in and XX.X is between share from share a per we million count the projecting loss which be shares we're so Sure, secondary and loss $X.XX we did said that weighted loss it per perspective that offering February. per to of share will $X.XX range average reflective

Kevin Cassidy

Okay. heard before. you. miss that Thank I had

Operator

to back remarks. call I At like turn for no I’d further time am management showing the to this questions. closing

Kevin Conley

the like to on your call. call. respective Boston June TMT Conference the New at in on in progress XX. be Thank or for if Cross We today's Sector Group you next you in with the a on Conference and Cowen contact like firms participating look that representative closing will may Everspin the participation Please May York your sales XX, disconnect upcoming Stifel reporting schedule to In now the I’d Shelton us. to our would you quarter. meeting Operator, forward highlight

Operator

gentlemen, your does you and participation in conclude program. conference. thank today's Ladies the for This

have You day. disconnect. a may Everyone now great

Everspin (MRAM) 9 May 182018 Q1 Earnings call transcript