Energous(US:WATT)2024-03-28 21:16Technology Development - The company has developed wireless power networks technology (WPNT) for RF-based charging of IoT devices, targeting a market expected to grow to 29.4 billion connected devices by 2030[13]. - The first end product featuring the technology was launched in 2019, with commercial shipments of PowerBridges starting in Q4 2021[15]. - The company aims to build an ecosystem for interoperability among transmitters and receivers, similar to the Wi-Fi model, to enhance market adoption[17][18]. - In 2023, the company showcased innovative products, including the world's first smart football and a battery-free CO2 sensor, at CES 2023[24]. - The company holds over 250 issued patents as of March 1, 2024, with a focus on processing algorithms, antenna designs, and ASICs[36]. - The technology has received FCC Part 15 and Part 18 approvals, ensuring compliance with U.S. safety standards[38]. - The company plans to integrate its WPNT technology into third-party devices, enhancing its market reach and application versatility[33]. - The company is committed to pursuing regulatory approvals globally to facilitate the widespread adoption of its wireless charging technology[37]. Financial Performance - As of December 31, 2023, the company had an accumulated deficit of approximately $382 million[56]. - Revenue for 2023 was $474,184, a decrease of 44.1% compared to $851,321 in 2022, primarily due to a decrease in production-level systems sales volume[165]. - Operating expenses for 2023 were $22,573,929, down from $27,537,646 in 2022, reflecting a reduction in costs across various departments[166]. - The net loss for 2023 was $19,366,763, an improvement from a net loss of $26,275,260 in 2022[173]. - Cash flows used in operating activities were $19,248,510 in 2023, compared to $23,636,747 in 2022, indicating improved cash management despite ongoing losses[174]. - Cash flows provided by financing activities in 2023 totaled $7,084,345, significantly higher than $1,017,620 in 2022, reflecting successful capital raising efforts[179]. - Total revenue for the year ended December 31, 2023, was $474,184, a decrease of 44.2% compared to $851,321 in 2022[196]. - The company incurred operating losses and negative cash flows, raising concerns about its ability to continue as a going concern[189]. Market and Competition - The company is targeting multiple markets for its receiver technology, including smart home devices, medical sensors, and logistics applications[35]. - The company is subject to intense competition and rapid technological change, which may affect its operating results[49]. - The company faces intense competition and rapid technological changes, which may render its products less useful or obsolete if it fails to keep pace with market demands[74]. - The commercial success of the company's products depends on achieving widespread market acceptance, which is crucial for generating necessary revenue[65]. - The market for the company's technology remains nascent and unproven, with success dependent on various factors including customer acceptance and regulatory approvals[212]. Regulatory and Compliance - The company announced the completion of the regulatory process for its PowerBridge wireless charging technology in multiple countries, including the US, Canada, and Europe, for unlimited distance wireless charging[40]. - As of March 1, 2024, products integrating the PowerBridge technology had received international regulatory approvals in over 110 countries[40]. - Regulatory approvals for the company's technology are costly and time-consuming, and delays could materially affect business results[111]. - Safety concerns or legal actions related to the technology could adversely affect the company's business and market perception[72]. Operational Risks - Current global economic conditions, including inflation and geopolitical factors, pose risks to the company's operations and financial position[21]. - Inflation has significantly increased since 2022, leading to higher costs in supply chain, labor, and shipping, which may adversely affect the company's financial condition and results of operations[59]. - The company relies on third-party components, and the unavailability of these components could disrupt its ability to manufacture products[52]. - The company relies on a limited number of suppliers for critical components, with potential supply disruptions impacting manufacturing and revenue[84]. - The company may incur substantial costs related to product recalls or corrective actions due to quality issues, which could also damage its reputation and future orders[80]. Human Resources - The company employs 37 full-time employees, with 30 being engineers, and has a good relationship with its employees[42]. - The company is highly dependent on key executives, and losing them could impede business plans and growth strategies[112]. - Attracting and retaining high-level engineering talent is critical, and competition for such personnel is intense[113]. Stock and Securities - The company received a notice from Nasdaq on January 20, 2023, indicating that its stock price had closed below the minimum $1.00 per share requirement for 30 consecutive trading days[131]. - On August 15, 2023, the company executed a reverse stock split at a ratio of 1-for-20 to regain compliance with Nasdaq's minimum bid price requirement[132]. - The company's stock price has been volatile since its IPO in 2014, and this volatility is expected to continue[123]. - The company has never paid cash dividends and does not anticipate doing so in the foreseeable future, intending to retain future earnings for reinvestment[151]. Future Outlook - The company anticipates needing additional financing to achieve its long-term business plans, with no guarantee that it will be available on acceptable terms[58]. - The company expects its current cash on hand and anticipated revenues to be sufficient to fund operations through March 2025[175]. - The company plans to pursue additional cost and expense reductions and financing options to sustain operations, given the unpredictable nature of research and development[211].