WATT - Earnings call transcript Q2 2021

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Operator

Good day, and welcome to the Energous Second Quarter 2021 Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Mike Bishop with the company's Investor Relations. ahead. go Please

Mike Bishop

and Andrew, Thank welcome, you, everyone.

Exchange herein the begin, participants remind we These whether or these like forward-looking inherent subject make statements to conditions directly elsewhere the during press company's today's note statements, in measures during securities Energous to the to measures that as and laws, changes defined non-GAAP on revisions is by any financial Also, discussing or remarks detailed undertaking expectations prepared Energous would comparable that circumstances. release the regard in in are today's session contained otherwise measures updates SEC call as most uncertainties the that are company's events, or risks those statements. be disclaims are release, Except and with to included to Before which forward-looking call, I Q&A this the financial will will the posted company to required of reflect publicly during to please or with filings in Securities website. Regulation non-GAAP and GAAP Commission. Reconciliations G. by federal obligation

ahead, would of call Sereda, the Now Energous. to over Brian Please to like I turn go Brian. CFO

Brian Sereda

close Sereda, Mike, out I'd after And like the Thanks two hit Chief to press I’m good today. and before afternoon. just Brian Wire point Officer. Financial I begin, releases that

our QX ended organizational in second results changes release Energous operating announcing first, announcing XX, the The XXXX. and March press

acting as to will role. assume CEO; Joining Corporate who Finance Bill role VP me advisory Chief as Mannina, and President and Operating Officer today Cesar and an CFO and I Acting Vice is Johnston, month, Executive Controller, transitioned next the our

with as at Bayless, Board company devices and has the significant IoT last intersection discussion a the Director organizational regulatory the big over the been power also necessary via since it sufficient requirements sensors and an In Continuing from the of potential announced global the data Independent years. the addition technical Audit constrained we transpired more not communication sending quarter, that collect now life charging tag-like through distance and and began then company RFID devices distance monetizable And XXXX. designed last progress NFC goal in relevant energy protocols. joining Committee. seeing to of distance Since transfer of and of changes, the goal smart is and the powering our Kathy are under and Member public as meaningful or company of lack regulatory by constraints of feasible are has legacy distance to several data

In energy this addition, of reality and market of charging distance verticals. based regulatory benefits the technology to and and thanks of bring the harvesting distance our stated end as to we transfer real call, previous is And power by medical, in the to approvals, continue we will consumer new recent year. and other entering industrial, becoming a fiscal expect defense advancements examples

incorporating We finally the by of contact-based market end should expect announced year. in appear previously the customers this that also our solutions

results the operating quarter XX, get ended we before the details. for on recap the into quick a Just second June

result million We in in GAAP and revenue $XXX,XXX me progress million progress. versus growth, continue regulatory, primarily terms of expenses modest in a non-cash $XXX,XXX who let update to QX. will of technical QX. With stock provide breakdown will Total revenue closing in QX were the results that, turn our to Bill our and versus quarter the later see difference The in provide with on the partnership Cesar, call over call. QX of $XX.X Cesar? an financial $X.X in charges compensation

Cesar Johnston

WPT radio that afternoon, leader next-generation in techniques. transfer charging the the development technologies, good Brian, everyone. using or you, We wireless continues of wireless be and Energous believe Thank to power frequency

is retail the vision RF few transmit is roadmap with continues last into From grew the we safe expand. our far to as Our a to believe markets quarter, longer power and technology beginning line IoT, high core that range of it at our patent at next industrial, in a And will various the XXX for granted. future. which solution quarters four require and such portfolio patents by patents the such medical

near-field And the continues and technology semiconductors, leader our make and patents dedicated in most been RF-based Energous, to the from certified wireless IP fourth partner one are Also customer during to the strongest American charging WPT. by to valuable Our believe product this a We in certified that protect representing certification. products RF that Equus, RF have we of have industry, FCC. WPT company the that the which receive our systems have we believe we only WPT clear quarter, FCC the RF devices. portfolios four

a requiring delivery transmitter geared feet. instances in kit time our has that now is we includes our expanding evaluation obvious conducted applications. be, The WattUp a the based smart antenna have Every new We a manner can now. new to than Active should large IoT and a announced over previously a greater on of power low watt here towards the developer active IoT performance. Dialog, various the CPU, BLE or developer seamless X.X using of support data guaranteed electronic also requirements, to followers multiple processing harvesting of include built importance Ink, The supporting or at XX uniquely Harvesting areas in technologies. are cover Atmosic is design ceilings announced market the systematically active Energy mounted labels, receivers of for to Based been far-field power of devices sensors, This a distance that power transmitter kit includes availability accelerated a be energy SoC walls group solutions E growth devices kit. poised thin optimized with on harvesting partners ecosystem, on all very and that The supporting it’s and power it others. applications distance block myriad we Grepow, scope and along delivery partners’ building of at e-peas,

reliable specific a We or involving we IoT energy additional transmitted harvesting applications, most companies evaluating devices is power identify a of source our in batteries cases, with to to not use do whether require batteries technology are devices such power if internal what requiring their low distance, continue at charging actively reliable supply that that for as energy, available.

multiple currently that by military are are While WattUp data is sensors, automation, Energy smart our driving edge capable that system industrial, which the network of powering. Active retail growth vertical markets, medical several sensors cloud to including geared require captured and markets of the in support

opening market a WPT advantages, of operation support Our XXX with its and range. regulatory technical RF many efforts That's up continue megahertz. to progress, strong longer frequency on of key the to including focusing due

secured times other which to to two It Union, to At application. a the instance, the megahertz in wireless RF X.X XXX megahertz the current advantage. megahertz well-known For for Broadband technologies, a compared includes performance a our are range WPT is advantage the extremely fact XXX worldwide International supports adding that Forum communication frequencies crowded technology XXX Telecommunications gigahertz gigahertz. draft X shows ITU over or And Wireless precludes year. first a and of with of range new three of we our X.X standard U.S., a good Japan, to with this deployments one at will increase for necessary Meanwhile, smart continue the as power X.X our shows meter. for delivery watt for target as in beyond guidance industrial of RF is indications This transmission power significant sensors be applications, the of instant logistics. roadmap in such longer dialogue by larger and the completion WPT XXX that have end FCC

Vice IoT on for highlighted a Energous and guidelines, of the which power showcase only steel of products evolution an requirements but expect FCC We be significant to products, charged charging sure And details advantages The summary, Controller. IoTH now the examples other with of the expect cannot distance at and are distances. the the Bill that in customer of first Furthermore, path distance technologies. a market the with meet FCC next developing is the past we our also hopefully at is at also we call a be two we we as see one details for charging, for get functionality turn of the which first-generation the have President PAG the sensor of path Mannina, guidance at will show will along at charging distant of this markets, mature customers increasing near wireless our In not we able a of delivery accomplished tag the distance. quarters, allowing in said safe into new and in smart powered one to of less over Unfortunately, meter by but we future. advent TAMs, and the specific such technologies. products than have pre-approval we see market. with soon to on delivery market grossing near-field beginning examples Finance we technologies true along of calls coal-based of releasing call, to will the disclose received applications, Corporate I power cannot into believe first as and

Bill Mannina

Thanks, Cesar.

QX the earnings of XXXX operating second issued our our announcing for ended June we and today, financial close results the XX. market press at saw quarter release you As fiscal the

performance million second for of and $XX The total in $X.X and quarter to of compensation quarter the of quarterly recorded fiscal million we and share employee quarter, of year. loss XXXX. completion the Also GAAP $XXX,XXX vesting QX that the than earlier share than expense same million year. was the $X.X last ATM shares XX.X quarter, an recognize of GAAP $X.XX million, of $XX.X last of average and mainly the the the approximately million $X.X our milestone QX million shares. million million million higher expense weighted was count in a of expense prior expense an in higher which our added total or raised totaled an net higher year-to-date an vesting cash the in to expense or of per to related primarily was were share our with $XX.X offering revenue compensation last the increase second to approximately GAAP units million, second loss for second $X.X the GAAP stock approximately $X.XX the of on comment, the increase average per the to in in quarter total tied quarter $XX.X GAAP $X.X the on or this in loss second the my achievement per or and The was compared second million triggered million majority the outstanding, QX higher $X.XX was per quarter. Total the year-over-year expense than For expense $XX weighted XXXX loss increase at-the-market $XXX,XXX of XX.X of XXXX. The net fourth quarter or shares Year-to-date million $XXX,XXX due in XXXX, basis in bulk increase year-over-year approximately tied in share, the additional million net $X.X in quarter quarter, the share compares PSUs. net XX.X stock a to

a non-GAAP quarter. Now the for our numbers view of for

non-GAAP year. non-GAAP QX approximately As of $XX.X an million higher GAAP million information, an loss excluding to $XXX,XXX the approximately million approximately our non-GAAP $XXX,XXX $X.X Net higher quarter attributable approximately the last to increase prior our million. million mainly same non-GAAP loss expense QX a and comparison and a GAAP sales $XX.X in million and to in development and year, an $XXX,XXX $XXX,XXX an from provides then and loss, non-GAAP QX QX at of approximately depreciation QX increase of to of $XXX,XXX expense we especially used fiscal an to of when was increase shareholder headcount approximately compensation due $XXX,XXX total expense EBITDA adjusted operating compared of expense costs revenue, stage, prior of approximately useful $XXX,XXX the was was approximately of costs the our $XXX,XXX for last increase $XXX,XXX this XXXX. to engineering an G&A. investors, compared of and Year-to-date, to approximately $X.X stock consulting The expense compared for year. of higher was in versus costs. meeting QX mainly increase with company believe Non-GAAP million, $X.X last increase compared when in chip increase compared of and expense was and QX increase approximately period $X.X $X.X total last approximately and million and was versus or SG&A operating year. Net $XX,XXX in quarter expense for compared higher $XX.X Non-GAAP our annual year-to-date to increase an than totaled marketing together

ended cash sheet, million the remain $XX.X to in free. QX balance debt and with Turning we

run remain QX averaging approximately in operating expect our per rate quarter. expense non-GAAP net $X.X range our We current to million

severance to chip expected QX one-time to his quarter, the the reflecting to restructuring we charge, the slightly a For third see in spend retirement due also costs quarter. may excluding tap Steve in third Rizzone’s occur out costs higher related

Overall to net operating However, remain the the tape end XXXX non-GAAP could up XXXX. excluding to over out QX. our items, expense approximately XX% of fiscal being increase cost close net expected pushed one-time should

Cesar. As Cesar back entering examples the I the discussed, fiscal of before will to expectations multiple turn charging it end. current hold distance contact market for now year and

Cesar Johnston

for ongoing Thank would support. you, Bill. their In closing, to our thank investors we like

want regards to near-field our we to fiscal of on continue distance-based and year. progress We entering of the of both the opportunities in market end and and customers before this partner reassert with terms especially expectation thirties distance harvesting engagements, to customer

We that to only and be also Operator? technical quarters. opportunities the real regulatory this anticipate that achieved time, I examples power would will Distance share these and the open to additional, we RF transfer. for like to commercially At of here expect call announce commercial coming achievements questions. we through charging expect based to can in this lead

Operator

the We Capital. from session. first question Instructions] Suji ahead. begin Desliva comes Roth question-and-answer with now Please will The go [Operator

Suji Desliva

of role; the and new Brian, welcome Hi Caesar, role; CEO the good luck Bill, and best the call. in in role, your to luck next and then

is a the I be role years, is to on if to might clear just just there process if few want of as point, you wanted this to if and CEO versus the helpful acting out is there I come articulate change – wanted you point. as be that'll wanted CEO the label at the you to any. into Cesar, strategy point next, ask a And what last starting anything So

Cesar Johnston

is a search, no provide. than other Sure. there that CEO's The can company we conducting is update

Suji Desliva

Fair enough. Okay.

So the about I'll is strategy then question concluded. save that until search

points. press I'd the four at some I I already I'd in the looking announced four love release to So the make sure clear Sound, that's to data say of want EarTechnic, be just the highlight, customers should New then, information Gokhale, that's but the how that just customers you've you earnings, clarification Equus, interpret

Cesar Johnston

customers, correct. yes. that is the Those are three Yes,

Suji Desliva

And they’ve achieved…

Cesar Johnston

Difficulty] And out, pointing them [Technical yes.

Suji Desliva

does pipeline how of know the among then understand four the is? to how And of for how cycle that additional, approvals the that. average just take now? to future appreciate on like I what long it I'd get And is where then to kind stands understand perhaps pipeline from FCC does approval, that or to months many just list customers, FCC once process additional look customers starts,

Cesar Johnston

And fast. use of and in on the But number new We through process, of customers far have times, fairly the a for this where different that a customers there A to design. it's pinpoint could and is me that it's depending at go function today not, it been longer. customer these office when to are a as of our government using a and it's design reference us, a provide pre-approved already timeframes take as they can or the time going go have always is yes. lot hard signs whether general,

Suji Desliva

Okay. Fair enough.

your watch of kind then this watch easier partnership harvesting we the talked So talked so What how this with next on of that what but lot an milestone to achieve? you for and you you're about the in a to energy designs, – for with that. would opportunity few to What eye us getting reference Cesar hoping quarters tracking the rollout understanding we'll Atmosic forth. to, this to would it's success keep – about harvesting energy the perhaps point indicate area? And should quarter, or you

Cesar Johnston

Yes.

happening is today. active harvesting So

We companies that out. have already partnerships a with we pointed of number have

well E see with we the ramping providing quarter, we And forward, the and are kit announcing also potential now kits you technology did we’ll new as their that together we different those Ink. that design actually that do customers. e-peas What And move can to will we're we recall, dialogue, is If reference last that as puts we you up announce up and utility. that partners show a those systems be add identifying have – potential customers as to that sorry, ecosystem. can and as whole

Suji Desliva

How Okay, helpful. second the the if that And Bill, then at versus same about you further OpEx, I to be timeframe? mean, will investment, is think you're want you going in I of the build? to increase calendar half forward guided I year, versus products last the or need the question, perhaps XXXX should XX. understand I for level guess sustainable the there what to to need year for an that now XX level

Brian Sereda

can is I take Hey, that. Brian. Suji. This

XX% don't of the I expenses chip the big timing a GaAs, again, year-over-year whether lot think we're increase of difference other they're in We one-time. range. in that costs. GaN, see a CMOS, than there's fluctuation tape-outs, And for in

here but QX you So CMOS taking up. as fabs are based we're off shortly, the could fall timing, pretty busy a tape-out and into on know, it backed

far was out. question. second part And I fully as that investments of your think capital built As We're go. the

have not or We test equipment, the fully investment years. to amount mean out built utilized. of any these several buy don't CapEx terms go We labs size. see in material big have and that but last requirements. some They're really over They we out overall may additional dollar

Suji Desliva

half OpEx, Brian, a can actually is going this you of Well, ahead, a second is business? build about the after level the year, question this

Brian Sereda

that believe semiconductor delivered we've design the I talked, integration some increases engineering as leverageable usual highly inflection systems and to amount see technology, And highly we We'll right. it's model, head model is do very, the business volume with the an believe, I a this to this model. leverageable. upfront. fabless but leverageable modest believe and work revenue mirror as a any don't is once in model point of company. we've increases, an expenses We But We're expect continue obviously count overall ramp.

Suji Desliva

absolutely. Okay. luck. Yes, That's help. good all Brian, had. your good to for in the thanks Again, Again I and all luck roles everybody

Brian Sereda

Thank you.

Cesar Johnston

you. Thank

Operator

would our closing to turn for Cesar back session. remarks. the to conference I concludes Johnston any This like question-and-answer over

Cesar Johnston

and that everyone want power assure that We the this thank that you the has to lead conference forward, moving company it this RF make can Just happen. is call. wireless attended we'd

we're you. it here make to happen. Thank So

Operator

for today's presentation. now conference concluded. you Thank attending The has

now may You disconnect.

Energous (WATT) 30 Jul 212021 Q2 Earnings call transcript