AKTS - Earnings call transcript Q3 2022 | Akoustis Technologies, Inc.

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Operator

Good day, ladies and gentlemen and welcome to Akoustis Technologies Fiscal 2022 Third Quarter Conference Call.

As a reminder, this conference call is being recorded. At the conclusion of the company’s presentation, Akoustis management will take questions. [Operator Instructions] A replay of the call will be available to the Investor Relations section of the Akoustis website. [Operator Instructions] I will now turn the conference over to Tom Sepenzis, Director of Investor Relations. you. Thank begin may sir. you And

Tom Sepenzis

you, good the call. to on and Welcome Thank to conference morning call. XXXX Akoustis everyone fiscal operator third quarter

are Aichele. Jeff and and our today of CFO, EVP Dave Ken Boller; We CEO, Development, Business joined by Shealy; Founder

prospects please included today’s presentation begin, regarding company’s of call, as update matters, as are from expected in our this statements includes today team statements statements than and and plans development our including that customers, and are regarding impacts forward-looking COVID-XX predictions timing and uncertainties. regarding collaborative statements. wins no statements costs, risks of expectations objectives, expectations orders, company revenue, customer on expectations design All the into expectations potential conference outlook. current product other note strategies, today’s and our fiscal of of partnering we made forward-looking subject about entering forward-looking the based litigation operations the Before for to and obligations statements to milestones business the our quarters, historical assume pandemic, The and business forward-looking operations, orders management future and relationships, facts or possibility such achieving numerous of any the call. regarding acquired future on are and current the Such of product integration guidance and

risks results cause a Form filings get with differ SEC of SEC XX-K filed Our XX-Q actual Please understanding to Form the refer better uncertainties. important could that our those and factors materially. to latest mention and to

section today Akoustis. comparable call akoustis.com. over of measures financial I call of now is in GAAP will to to CEO available Investors presentation the like would of earnings refer also addition, Founder non-GAAP reconciliation and directly the to these release the our Jeff measures. turn measure to presented in most Shealy, highlight A In certain our

Jeff Shealy

able sequential fiscal our leading year-over-year call. growth products. welcome, to over filter everyone Akoustis am were COVID-XX Thank associated the pleased that Tom XXXX ramping chain growth our to semiconductor new report March as bringing environment quarter, production the to the I XX% conference XX% third customers you, commercialize despite macro shortages. to the BAW We accomplish customers and by enter ongoing and revenue XX. than In in of and supply quarter continue driven total headwinds the greater we this to X number revenue production, delivered

in record XG we that revenue we this given see continue Currently, grow $X.X our expect for of see other quarter, bringing million quarter mobile, will activity XX, X customer to future. X. the infrastructure revenue fiscal for We XG and of each fourth expect discuss market the WiFi, more by to number the remain the with to increase segment. like production and I beginning customers than foreseeable segments ending for the customers delivered March June and revenue continued We of in number calendar XBAW current growing target WiFi confident growth WiFi greater quarter markets, sequential throughout XXXX. detail, XX% now in ramped additional to our will we filters sequentially. XXXX We of WiFi total would our

wins current filters the filter fully products quarter. add to progresses, gigahertz I pleased also WiFi our months additional over We XE and March June to quarter new have design we X.X release design and and in production XBAW in over that we gigahertz and for qualify XX and XE/X few customers past expect including as X.X the into the qualified both WiFi X additional XXXX secured calendar wins to announced design wins, announce expect am

developing our the for WiFi continue in we advance largest chipset to the world. are PC of currently progress one diplexer, of we the Additionally, X makers which

was positive customer the that enabled The December valuable just of technical to Fortune XXX next into fab feedback new in their performed customer design we and for facility. which well to this on characterize York providing in and diplexer design. was feedback the shipped our The system first this New received design initial diplexer iteration, released

surge solutions to iteration and X for and filter XE bandwidth ship multiplexer the of X were and gigahertz WiFi We products. one commercialization to WiFi X We XBAW difficult operation than X. from the for extensive we the and expect exciting for product have recent this WiFi customer frequency sample the dual-band for and June fact market triplexer in diplexer, wide to WiFi WiFi recent XE early and the filter our on enormous have X end other portfolios filter now BAW summarize challenges activity, more within OEMs the most to interest coexist, X BAW of to XE spectrum. our and the wins design address schedule To of quarter. today the filters, current XX in extremely We of other commercialized to new X by that and received WiFi frequency have attribute remain X an the WiFi we entrant high

PC and enter our very we X of design of design WiFi are end will X from revenue. us the volume WiFi both led at and opportunity market, first to X expect substantial As advancing wins wins, quarter. today, current we XE in announced unit production the including and Further, by filter released and have development calendar we WiFi total another of the XX which have up throughout a last multiplexer lastly, products into qualified our diplexer market Furthermore, and XBAW to year. additional we filters, the XX WiFi wins see of design allow

the to RF continued to X X, maker on another X March our development in in Moving during Tier multibillion bringing number X quarter, module momentum XG adding total XG Tier of XG including mobile customers new the mobile, mobile front-end dollar customer we companies.

plans March coexistence a with current to and specifications. mobile We quarter band designed quarter for in design cutting-edge received designing and a the XBAW XG order to in currently XBAW early stringent Tier filters X an this mobile order modules X production multiple our mobile first expected our technology development smartphones use Our for customer at component shipped new challenging ramp follow-on XG of the and in above RF filter customer to XG second customer bands Tier the calendar devices. optimize end new an from XG other We deliver challenging X gigahertz March best-in-class beginning year. use mobile X the multiple to initial received the XG for is a Tier in

New are designed customer pleased And with relationship we X resonators mobile a in Tier reiterate end additional module this current the be redesign XG After new into design received York the the first calendar finally, our our order resonator also to fab progress with filters to mobile follow-on quarter. the from deliver has filter and customer characterized the We RF The models June we with for original X to filters. customer. our customer new and to our expected initial expanding was deliver the in quarter on current of engaged to shipping XXXX. using continue completed remain by the filters or We the track specification level end are driven Tier WLP filter XBAW and customer’s was released changes technology. at with and by X to that XBAW package driven December, not XG our wafer by of

quarterly we our As update bringing New last are our fab. within mentioned WLP in-house production York we the on call, of our

a customers this with XG during of shipped multiple we lock summarize a are mobile for design added multiple to the for bringing us the to the mobile module control ability filter customer packages. towards X qualification would X customers XG/XG work March the resonators whom maker module our cost X year. filter for production companies the of in-house calendar has manufacturing we front-end announce process chain for, X ramping quarter, substantially we make mobile module RF business discuss is quarter. of am X company the to XBAW multiple new And and infrastructure XBAW to are maker Tier filters second develop X and filters our agreement is WLP quarter. which the WLP samples customer-funded current full new network design XBAW have a process multiple fab, in filters, activity, officially finally, available we supply filters X customer RF quality, second using follow developing development our front-end for XBAW expectation we Further, to RF expect Tier of total the currently our in are Tier like we engagements later of currently Tier developing if that a advanced second XXXX. Radio mobile continue And component to to customization of I infrastructure mobile now, Tier into WLP during We enhances X Broadband XG handsets, packages of that believe locked March including with We New have first X Service Tier the advanced mobile in filters filter X to maker, March filter production a foundry We the signed RF and a to with and I for, expect highlights. of qualified Tier we our that design module to XBAW number calendar and began filter include front-end X pleased our To half front-end new bringing York multiple a our XG one OEM expected for accepted. the that which additional our Citizens X, XG migrating customers. we

win to announce customers third received and will June in I quarter well. another the we expect which We pleased am as begin infrastructure two that to June ramp quarter a beyond. CBRS also the from to these to design OEM ramp in have network continue current recently

engineering success the the XG our and momentum experiencing March we are and Given mobile, shifted in quarter. in we resources WiFi

now pursuing the have XG C-Band as CBRS. small X current from we sample our wins completed our To gigahertz filters, the X infrastructure effort we X base design announced XG remain for cell we As MIMO customer next XG generation X activity, massive update X design infrastructure small and in is quarter progresses. will and filter summarize cell customer. X.X stations such, Tier materials second expected for this U.S. with to actively our To-date, for we you a network and infrastructure XBAW new market XG and have network our win X in

design infrastructure X OEMs. wins received for X CBRS have from we leading Additionally, network

progress our enhance XBAW DARPA further on, our PDK. existing R&D we defense to our during with QX on to business, contract Moving continued in contract

X to higher XBAW implications the materials. filters new in values focused are using DARPA X we In to to gigahertz soon. RF front In associated our positive power finalizing new market addition, and the frequency we to high entering manufacturing XX to other segment, range that share frequency dollar our gigahertz given these up device multimillion current may with with and in handling recently with capability expect our have contract this and a today of market our announced leading materials we range materials you resonators. extend on operating novel with have Q on These timing are news XBAW multiyear

both opportunity of We devices. new high ultra use customer’s The XBAW a this volume for in market Akoustis RF finished timing develop timing frequency maker are to RF for working a in and leading revenue. resonators with significant unit represents components

customer market jitter could devices. older that looking Our analog timing to technologies in primary components phase the RF developing ultra-low displace disruptive and noise be with is products

supply addressable leading of the finally, industry. excited civilian and forward And are opportunity. being staff continued RFMi success of segment extremely XX% this completed market. have enhance the this welcome resonators solutions TAM. look to now we are We activity, entire that a our Akoustis filter announced market to the summarize and X to completed groundbreaking used We as digital to the and team morning, as To timing to defense communications filter and which sales we XBAW XBAW frequency control part for acquisition channels our markets. of our resonators have will disruptive be in a our ultra-high the Further, products we other RF XBAW RFMi acoustic broader grow business deliver remaining can chain the our

the orders contract engagements, successfully remaining In like Further, with improve and we XX% RFMi. XX our over direct us total contract we of go we X the our customer by And through revenue. acquisition Ken expect new the XBAW X our multiyear to placed to up driven PDK highlights. addition, purchase or X multimillion finally, in numerous with the we the completed have continue and refine dollar customers of of a DARPA sign hand already gigahertz. a XBAW of Phase NRE to to the XBAW technology DARPA scale to which addition acquisition, acquired I through now to to have provided RFMi would to financial call with to

Ken Boller

Thank you, Jeff.

million quarter $X.X third $X.X quarter revenue revenue $X.X an of which depreciation by other $XX March million totaling revenue of company million reported expenses March million. $X.X a mainly million, driven and of ended the were for in XXXX, XX% costs guidance. the million, is million operating expenses of the quarter, prior loss of December XXXX On cost For increase Included million. with XX, and offset line amortization operating in $XX.X our costs of and $X.X operating the was ended by of XX, and revenue GAAP basis, operational of over $X.X labor

section level in morning per expansion million the down is would million in GAAP per basis, $X.XX. available in highlight in the operating trend QX, the of to measures $X in continuous the packaging $X.XX. front-end of CapEx a to capacity the the corresponding release involved significantly the we related issued share As tapers operating prior spend CapEx with was a wafer result, Reconciliation to for net was of loaded share On was is York fab. and activities quarter, and half from was to was press decline the prior expect loss our the corporate GAAP bringing as redundancy second company’s Cash amounts net non-GAAP $X.X available website. mostly in-house the to I loss New million like million non-GAAP year Investors costs to QX off. and used in these beginning quarter. $XX.X the down that on in $XX.X compared million this $X.X equipment loss

of versus We quarter decline end half also expect and $XX.X million our utilization. see in operating the expenses The our greater the exited cash year second company from the the million March of benefit as with equivalents cash to the $XX.X fab previous quarter. in costs at

growing per average ramp expect multiple XE During quarter, production we March than we financing to call from million sequentially and based through the line milestones. of the discuss backlog upon infrastructure approximately continue the fiscal the share. quarter, in raised In network that the year see company equity I price XX% $X.X our and of to June WiFi will fourth will fiscal design Jeff turn and and cash additional to our expect performance back beyond. next therefore wins, and we future anticipate March now record $X.XX the at-the-market more into quarter. quarter top And customers our growth over new to revenue, up

Jeff Shealy

June quarter impacting view to supply and supply Ken. broader of chain are the shortages pleased remains issues our the the ongoing report semiconductor you, that industry. positive. I that Thank am Despite

business our customer grow end infrastructure each generate progresses. quarter, to expected other segment. customers production and XX our driven segment. XE, XG with our June to across X, and expect mobile, By WiFi, revenue the to from we as customers, In than infrastructure, current markets our XG market expect XG of segments, continues from of markets additional more by ramp quarter, the network all we momentum to XG XXXX WiFi design Our the calendar other wins XX WiFi mobile, including

towards strive progress. milestones you of will to informed and on our keep targeted our continue executing to We continue

two and PC development design into we to WiFi headsets milestones a received consumer XXX for chipset order AR/VR segment, to expect in deliver announce XXXX to customer other Fortune expect include we feedback. additional first, diplexer Further, we Fortune XE from our for second X our and our XXX anticipated And expect Our a design iteration next company internet generation wins. devices. WiFi June diplexers

mobile customer for purchase from XG December. mobile first a segment order announced X our to a XG filter the expect in receive For Tier we

for Tier expect for development. develop RF customer original of filters for first their we first initial are And the currently purchase filter. XBAW receive module to supporting front-end design our Tier new X customer X and order addition, we additional to mobile X filter our XBAW a iterate lastly, samples In

X development other XG we Tier small we both for for expect network with X order market patented And in dollar purchase new segment, project multi-chip with the to XG infrastructure X customers high for to we module our of base deliver our we our to patents multiyear as a Next, equipment. gigahertz technology. In a sample in we production patents expect customer. cell for XXX for continue segment, to is moat plan conclusion, T-band dollar the build and the expect our XBAW DARPA. we with ramp We pending IP opportunity finally, Tier substantial XX infrastructure around station receive now substantial. and new And a market frequency filter and customers defense multiple XBAW and a a filters U.S. expect to CBRS to believe X.X X.XX issued DAS/AAS finalize have multimillion to multibillion market

work to execution will each our continue updates objectives objectives on diligently stated to provide against to our and going We continue we these achieve forward. of

R&D, our network multiple thank the Finally, kept I the work, has which design going the led across for the wins has ongoing pandemic and passion team defense markets. our would our during XG dedication, their infrastructure and employees like to to momentum hard as particularly on WiFi,

the new our level momentum driven leadership capabilities. expanding the that exceptional I questions wish in and also filters with the mobile from with and question. go shareholders Operator, community. our who gigahertz support by our please above I experienced market call open the also have like packaging the X first XG that, to company. for to We operate investment And in would thank wafer to continue ahead

Operator

Instructions] first have line with Benchmark. question from our the much. Thank We Please you very Cody Acree [Operator go ahead. of

Cody Acree

Yes, just in or seeing talk real of congratulations progress. engagements? Jeff guys. Thanks guess quickly you your China and question Guys, Shanghai for impacting on any that Are with the you I taking Dave, area? the can lockdowns about the the

Jeff Shealy

Hey, here. Jeff Cody, good morning,

with I’ll me and will Let comments. let, start Dave follow-up I let some

Dave Aichele

seeing side. Good mainly hear filled of It’s through country. much exporting – the you. on supply from too really the impact importing are to are going The and morning, not that receipt Cody. just from Good into we ports delays we What seeing of the up is materials. maybe

So, we else has well. OSATs, and China somebody have some in of as our some located of the then customers

week that’s X but that’s that So impacting right we X, for a are now. counting delay maybe

So, other anything we that, significant. than seeing are not

Jeff Shealy

Yes. here. And Cody, Jeff,

team the side, evenings lot China Just team has OSATs as a our spent aware. many, give perspective, are use operations credit from And of I probably our our you overseas. to from managing. well We my quarters up one late for had that I of internal credit that. healthy had a the of We supply the strongest backlog the successfully objectives We really the we many and our quarter. for against had shipped And operations out we team chain.

think on that but team they the is of manage have so right lot and an forced handholding what’s has quarter. calls, online And feel we pandemic I last done to we this what job did – excellent has a got

Cody Acree

the and of your how But remarks. the and customers, if just that. just that detail the your in is and XX talk and does quarter, are expectations go customers, is quarter summarize a that the the you where then just If you year? revenue about of revenue? your gave the to came during on you that for then Thank from XX lot from that through your June June going that quarter, you here impacting maybe Excellent. thank prepared how parse the where rest coming and Jeff, maybe back what for into XBAW you of bulk can

Jeff Shealy

more then I I a that Dave customer From will let certainly Okay. strategically. follow-up base, touch and will

Dave Aichele

customers now. Cody, right sector. the in question, we to are a those WiFi as XX So have of majority production we And the got highlighted

WiFi in XG X approximately in of them are X the sector. are and So CBRS

Europe can strong going a split we and you between good the It’s where see, last that enterprise are is in the to a these starting quarter the against split. market I WiFi. continue we so with very as it’s consumer really North to CBRS And a And up and also percentage And split track XG carrier that a I had just larger market. pick America, so a as to also have and categorize are it’s customers the customers retailer a timing. some OEM, going – design mix of to is the semiconductor in as the in we then we have from shipping at its in a impacted those from remarks and and regionally well. these to over design between And America expect being customers, being we transition the on and Most production wins but continue as to we Jeff And also win to Asia, are have split shortage. with Asia. least highlighted, of North early regions. is that these And by And it’s also, production. done just

layer the going we and that So to we some see. downs customers ups of continue in may to offset new are to

Jeff Shealy

look we volumes segment. of actually I had of wise, were to the terms bit, quarter as we segment Xx in the volumes Cody, in infrastructure the up healthy XG the at a in that from mentioned infrastructure, little a approximately just believe the if comments piggyback just XG you CBRS. in

is just at growing about really our a us, XXXX level, revenues. high For

revenue the have the our and very diligently have get we to form enable wafer these into that from are – market. a package working well half We going have XXXX growth draw that from is And announcing have really second on that to factors been design mobile XXXX miniature the in And really basis as got is we we for as been of wins level storyline – WiFi. expanding. been focused us

on really the half. home X win in in the currently pushing first we segment and hard said, in a we we second got are customers have design As to mobile

in that’s how been of we the but of we to story support and some we is we are the that what been of initial putting that’s wrapping up fab mobile support how York regard in capacity, the in have And that it. well doing. of as to again, the builds New sort the order pushing that have programs kind – kind have with the are we that, So, how work as for

So, there some additional is color.

Cody Acree

you. I guys of that appreciate both

If maturity you can we WiFi. over of Jeff, explanation And your about little of nascence am your about just into right some for is and moving a towards you when volumes? momentum, be being think revenue maybe, expect relationships can how is more just talking about I talk that base your those now skewed looking in efforts the them bit would projects obviously your current what I mature more guess I that of some the

Jeff Shealy

the in the – right two or I to you products really machinery have that. to you at and from got operations have got it way look right the So into order is branches. one, to Number support

in that base. very We we that also chip the the produce but have and putting product right and have have to that been pleased can fab you place designs – have a

us allow a question, From we – to these X. customers. of get standpoint, for the So as well comments, we your in shipments of have in supporting XX in part I for X the to have we WiFi, XE we four commercialized begin now said WiFi – those as mobile I think what the got to WiFi filters, WLP has are prepared are was think really momentum

We modules. have us of had And chips given the front. confidence RF that’s what’s demonstrations mobile successful on the our in

is momentum the the side. on high say I’d So, mobile

being to filter out RF We than companies RF are those benefit certainly enjoying modules. supply module there the companies more there of

a from position on from back a a benefit of support market. was look time chain in gives and as WLP. that’s the supply confidence the that. out to that’s New that So, mobile us momentum we pandemic, one from now we are for we as the well stores cycle you certainly if of had went long what we can very York. outsourced in the And the again, And But impact that

comments So, at those my wise. are momentum least

Cody Acree

That’s it Thank you. you. thank Okay, me. for

Dave Aichele

Cody. Thanks,

Jeff Shealy

Thanks, Cody.

Operator

Thank you.

line Please have We Piper the from Harsh Kumar from question Sandler. next ahead. of go

Harsh Kumar

Hey, Congratulations. Yes. guys.

growth to in the that pretty think coming. diplexers the XX% growth mentioned meaningful contribute I infrastructure WiFi? also And number. you whether the mobile/WiFi, on? it the lines expect now, from sequential about all, mobile think also that to of that quarter. it June when curious more your or that June XX% of wanted was some do tremendous sequential, you growth revenue I you highlighted how First items, Jeff for rate to and most quarter you that, Interestingly, I you PCs then question number about ask that business you? different terms of or coming later will areas second and my that right is then become for for Is in be ask

Jeff Shealy

Okay.

of let’s those. So, tackle both

touch on program. that am order, the for in go diplexer reverse timing Dave I think I

Dave Aichele

Yes.

for end were second design, are to phase them. into we about product a this and are diplexer ship the And we their to really the provide they year, the a, that’s and they to PC in in doing moving where first on in take into MPI that their gotten the is also able go really preproduction is characterize that So, start iteration chipset a what of design the them iterating development phase the that we ramp development that OEM, the shipped doing we And start expect to then to feedback expected we us production next chipset, months relatively quarter. by going volume. are systems, then XX of and launch characterizing high their end going and mode. be with then And are development to we’ve

that that’s So, customer. the with focus

where now applications which design type technology, and the is isolation, capabilities. WiFi and has XBAW requirements asynchronous with Technology you are this the consumer X, of for benefit XE and just XBAW very applications take mobile, a We operation significant coexist starting WiFi in these that for for the to coexist Technology, on see benefits becoming important

expect we announced or in So, get into consumer application. as QX, QX, to from as a the we come another mobile order we

are we with well the itself potentially potential diplexer beyond. about quadplexers lends technology and diplexers the with also So, and the excited and

to and technology. share So, with continue capabilities going we are and our the to engage market

Jeff Shealy

Harsh, in segments. first all Okay. indicated from point the growth of we that growth, your to would those I back tackle I and in following order. sequential terms the come will think

we First, plans and want investors in we started I just not already I WiFi design wins, design what XE, that are characterize segment, appreciate wins. mentioned would ongoing And in have is, we but the ramping additional the only to enough WiFi just for ramp. just now

we in continue where ramping X, segment. going WiFi X. WiFi WiFi the are we in announced sockets to additional both have So, the That’s

two And continued product in with across we – the We module. that’s have X. of growth production that There part very WiFi that’s going is that filters in high design look more is wins in where – certainly the you again, got just WiFi a are that XE. roadmap. that’s, if WiFi level just at is that wins a the by so WiFi would multiple or that’s in a that’s And segment. segment greater design – integration consider development in on In big going starting is

say have active growth announced roadmaps But If the of segment insertion points. a digits see activity Mobile that you have that go that that. expect us. have then touched the have can And will strength point quarter-over-quarter. on I to segment, Mobile we CBRS is And we the the XG have for be what addition customers we to of Dave in single earlier. for that in the kind got we – quarter-over-quarter I

produce now emphasize those WLP designs. which process, in-house. those designs And so can I And with we driving we are supplying hard coming are again, the

so Market segment, then as And the DARPA in and supporting details Other And the program pretty been well. are immense where will we that multimillion growth were have right in that we see DARPA those on of We the segment dollar program. winding as new have. the we PDK we down

from new March we in quarter However, program. no DARPA the revenue the had DARPA the from –

will be come further we be that’s to that that so producing. for about in excited as And we that starting some that products And going really of will program we enhancements end the that the will well. are program see technology be from

is our that discussed. So, pretty four markets, segments But market about excited it we are across our all of other that. we

Harsh Kumar

and Thanks, congratulations. guys

Jeff Shealy

Thank Harsh. Okay. you,

Operator

you. Thank

of have with next line Rich go the Oppenheimer. from Please Schaefer We question ahead.

Rich Schaefer

progress all and congratulations. guys fronts. Harsh’s like echo seems will on Thanks Nice I

my question, us describe guess BAW on are am your anyways the the talking what I and congrats there revenue of I your and can really PO give is and funnel mobile the in level then PO on just you I five any now, bigger to sort set that latest you me? for customers, of maybe if like sense think if mobile, and maybe everything. first picture looks across timing release mobile my one that curious revenue latest you could us excuse about

Jeff Shealy

with there. Rick. Yes, Dave your comment. for will no kind worries. start the Rick, customer thanks perspective

Dave Aichele

morning Good Rick.

these and engagements to relationship. It Let we in-house. at me ramps some accelerate an paint with the looking have over I years, the these engaged that programs. start a having looks turning pre-production, has over what R&D has little corner to more commented, WLP been picture the of really really to many out that WLP think Jeff maybe production last so X of we prior X customers us was can And the of allowed enablement really next And echo years.

manufacturer, most one us the X is commented. So, Tier the which component for we that’s exciting the

end well. designs have favorable the year. And channels. and already their really, volume the designs first got of with with production to them we been got as that’s this to be and our them their customer align And two with And have on to successful. by qualification has that target our response customer both designs look We WLP is

one, two. into not with XXXX through that lead will if So, production

the in is that’s now. with four, we early. respect levels of other right So, With one to are the discussions what March in we just announced different engagements, their

As you time production transition, that going and things our see go take some XXXX. with we the is will ramp can to well but through to imagine, in that’s hope development them that

in then the between And targeting. out. is engagements that further bit that other are little we a is that So,

design So, as targeting that X, China market. intent would front China go mobile be onto Tier next year production our end, our the would well and the the

our other to that. in that various on this is we start it’s ramping degrees and and continue laying grow, end to step WiFi infrastructure, then to the that in XG next all to revenue of XXXX. be levels of year – the we from it’s programs see of once expect But production production So, function growth top mobile

Jeff Shealy

that get to miniature as can in was RF and Jeff which our characterize for we I from just integrated would what designs Until in the here, March going very appreciate the just qualification that pain chain around enablement were color that that we I point a to it. us more as side. technology parts supply WLP, allows quarter, Rick, And customers, that really modules, to that beginning for is building a add be in-house the little to late you just see have

So, with module. where integration technology that from full complete wafers the now delivering technology we into moved actually struggling WLP have with to

very So, we we – got from positive that the customers. are feedback have

with and focused said. just would includes as a separate as satisfy on quality a documents building through, half also to terms kind be Dave reiterate as for really on We could for us, supplier. XXXX requirements production, as engineering of looks customers we quality would us what what with Also, meeting meetings engagements a is like our having. management their with which of customers, procurement, with in separately fair we plan to across of meetings couple design them bridges to of those design one coming type weekly like. two the business In strategic for units, win, XXXX, into going Dave second that a really half pre-production with things we and us amount characterize, win lot are coming to two said, engagement That one of second expect well to of be quality, these

that’s just So, what Dave little color a to more added.

Rich Schaefer

I color. go ramp guess you end about that XXX am that the calendar year. assume of second think And where all I And is for far year because your million, could end know, it’s from doors start this really to called I the so in capacity here year. I get sort the comment? the the question And its am guess to how I believe I times? I of just around guess by I it’s given just on around And lead maybe now. being curious, Do how and of Chips I if there is to was to what’s guess the sort you you hearing I year of Jeff, kind that mobile tools once Act I orders what throwing guess long get by are if million have of would or whatever or approved. of calendar lead curious talking my question past XXX a on curious latest my capacity. I release, perspective the strategy is Thanks I is again, if ordering And I saw the time. now that on is, are obviously, you a we how opening would, lot business. long

would of as be your are it money, of Thanks. would So, Act helpful, too? strategies that comes you be do of Chips that you kind found if around just or and sort what’s treating when any order ahead or money

Jeff Shealy

Okay.

or if to first, am want So question you tackle going I don’t to – your first Rick, I second your be mind.

So, I well on some in House Act, and bill. separately in that differences The Chips on House successfully had of versus on the their it. a it’s the latest just pretty but documented voted think similar, the terms Senate voted

Congress what differences. the both of committee, thereabouts. made then the gathering approximately XX members, through So, sort a of committee houses which is And will that is is, up the that are process

President’s I be early that indications the that will all this have as to is we happen. We And differences as sent would to which desk it hashed think later expect those be month. out seen then for signature,

that into law. about bill signed being optimistic pretty So,

of terms question, investments than made, ordering flow was capacity we us And and were goes invest your strategy, equipment first this breakeven. we that better all have back to that In anticipation. have it to along about get in now we of said isn’t which kind our to that cash the going could

going that requirements weren’t said market backs We on the the have put to always we of our investors. mobile

XXX the to for million made get XX for investments end you. have model to filter the of at months to chips We we characterize react and the factory that out accordingly. year, this However, just actually

reflects had the an foresight our And is what get you to I equipment would we CapEx the so already equipment the standpoint, that characterize see million. order what in from have to to XXX

to million, stage aspect more XXX the actually this wafers. at run to the equipment to ordering get not are about that’s labor we So,

So, investment with we comfortable are we made. very the

this equipment As be of times you challenging. know, on pretty lead some can

initial million challenging. where pretty timeframe, capacity to in XXX we an to However, jeopardize to didn’t want get it’s of type this

we So, of those happening be order the that final around had to equipments, foresight middle the will some installs to year. of

installing predominantly, as we the in that, us add of are limitation warranted. not And for labor. are that the phase we But of we and will the that. So, ordering in receiving phase will filters be on

I if know. you question think I any follow-up I covered So, have your don’t

Rich Schaefer

No, Jeff. that was so Thanks great. much

Jeff Shealy

Rich. Okay. you, Thank

Operator

you. Thank

the of ahead. line from Desilva We have question next Suji Capital. go with ROTH Please

Suji Desilva

talked in reference on as elaborate to address or remarks, infrastructure. Aichele, shifting opportunities. prepared that between Perhaps here. segments Jeff, you new what around was Ken. progress congratulations Hi, Dave your well, great in you wireless about Jeff. clarify Could Hi was resources to? it

Jeff Shealy

me maybe Yes. have you engineering. I our up a let bit mean back – help and just we appreciate little about

a to advanced have in they team after we as come is high schedules got goal the product have in. and opportunities the engineering though engineering. engineering on And Where risk, we the focused get market. being product So, engineering go flexibility to predictability do advanced low to of is

the respond. look don’t able exception for the company The mentioned technologies, a have And to they are the we of at shift. are rapidly we opportunities. opportunities business I to flexibility process as will think strength a we that se, relatively come the from opportunities Dave is beauty into technologies have we shifting technologies I being it’s to the we those Pareto, are of and some the – what mature the We the WLP, with not comfortable. actually using have and are think pretty doing of company, of per

products from markets. run fab the to different have flexibility in So, we the

I follows evidence can in good run it flow. think just process have different we very we a very similar that fab of the that’s supporting got dozens products because

certainly small infrastructure think XG resources So, market. from specifically, I we have the moved cell

as and commitment. in into filter WiFi, mobile – on have the we vocal been market, really one the And where so customer do that than into those the some moved with are of about very support integrating well as have We more advanced module. the chips we a to we

those we want as So, actually add in Dave? as place, to line as to orders agreements well got have place you produce to programs. in that, to as well sight Anything of

Dave Aichele

Yes.

little U.S. due infrastructure investments I as the time. bit that not make is rolling Europe is, primarily adopt So return and The of that market, on couple that market XG bit has China lot panned been as was that to to slow is And like China really would is well early we to a And a comments in the going spectrum. hoped. new infrastructure the their out the in deployments investment to also little Suji, in of a the take way has out of a standards. had

growth things the And that really of the pretty least significantly market looking our are the now WiFi filters away with one performance with type been more of one recognized where these have is industry to high of is the we filter is to opportunities. filters. engagements we at shift is leading what from as BAW suppliers. starting And at clear, So, traditional the is

seven. see and we we have established upcoming So, what XX the activity in with

As to to be in the have a source want to be of they would leverage portfolio to the continue we primary that to, engagements. way will comes have they products we to that end customer us that these a go to continue

there. we resources and have to mobile, level had that on with design some the activity put So,

shifts. that’s main some So, the reason the for of

Suji Desilva

be may mature over take Jeff Okay. customer of rate have mobile of ask customers that’s and you a it. time customer [indiscernible] very to saying have may the color. just mobile kind may there that versus now, for way but of what are maybe a The the WiFi and fair, they run WiFi over And typical – Dave, customers average just a you kind two this have, customer? not to multiplier the is as and Thanks helpful question coming, versus

Dave Aichele

Yes.

the talking X. on And So, are Tier you are pretty it to to multiples X, talking or if Tier you are depends really significant. if

the platform Tier the end on can Xs, significant we they to in to respect the depending with after pretty are going that multiplier WiFi with respect an be get that market. So, that OEM

XXx that what run can rate Xx to be side. So, multiplier right with on to on respect now seeing the are WiFi we

talked about we calendar year as into that that, XXXX. then going something that’s will So, revenue and layering start in XXXX on

Jeff Shealy

just that’s line And a mobile that, the in add to what the in Dave said. more I another what with are Yes. market will that pre-production production Suji, levels the are for levels colorful of WiFi market, the way saying

Suji Desilva

Thanks Jeff. Thanks, guys. helpful. That’s

Jeff Shealy

Suji. Okay. Thank you,

Dave Aichele

Suji. Thanks

Operator

Jeff to the we Ladies to back to And end question-and-answer turn closing you, sir. Over you. have remarks. and session. would call gentlemen, CEO Founder the reached Thank like I of for Shealy, the and

Jeff Shealy

June a against I everybody to day next your goodbye. you would everyone execution time forward expectations. look our for during I good We future thank wish discuss Okay. like you. update to call with to and quarter’s Well, and today. the our like speaking milestones Thank to would

Operator

and much. concludes very today’s you Ladies Thank gentlemen, that conference call.

your may at time. You your you lines Thank disconnect this participation. for

Akoustis (AKTSQ) 2 May 222022 Q3 Earnings call transcript