Vuzix(US:VUZI)2020-05-11 15:36Financial Data and Key Metrics Changes - The first quarter revenues rose 12% year-over-year to $1.5 million, largely due to increased engineering services revenues and strong sales of M400 smart glasses, which drove a 35% increase in overall M Series glasses revenues [36][40] - Sales revenues of Blade smart glasses decreased by nearly $0.3 million, or 55%, primarily driven by a 20% decrease in their average selling price and lower unit sales [36][40] - The net loss attributable to common shareholders for the first quarter was $5.9 million or $0.18 per share, compared to a net loss of $6.8 million or $0.25 per share for the same period in 2019 [40] Business Line Data and Key Metrics Changes - The M Series smart glasses saw a significant increase in sales, while Blade smart glasses experienced a decline in sales [36][66] - Engineering services revenue is expected to be over $600,000 in Q2, with the potential for one or two new programs before the quarter ends [70][83] Market Data and Key Metrics Changes - There has been a notable increase in demand for smart glasses in the telemedicine sector, with many hundreds sold for telemedicine purposes in Q2 [53][55] - The company is experiencing increased customer order flow, average order size, and the number of customers placing reorders, particularly in the U.S., Europe, and Asia-Pacific regions [14] Company Strategy and Development Direction - The company is adapting its sales strategy to focus on remote support and telemedicine, driven by the COVID-19 pandemic [8][14] - Vuzix is working on the M4000 smart glasses, which will feature an optical see-through display, expected to be priced around $2,499, indicating a significant rise in price compared to the M400 [28][74] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, noting that the current environment has accelerated interest in smart glasses for remote support and telemedicine [15][79] - The company is focused on minimizing cash burn and has implemented a compensation adjustment plan to save $1.2 million in cash [41][45] Other Important Information - The company has entered into a stock sale agreement to sell five million common shares at a price of $2.25 per share, aimed at strengthening its balance sheet [49][50] - Vuzix has over 157 patents and patents pending, positioning itself as a leader in the development of AR smart glasses [32] Q&A Session Summary Question: Can you quantify roughly how many smart glasses have been sold for telemedicine purposes in Q2? - Management indicated that the sales are in the hundreds, with a significant shift towards remote support in hospitals due to the pandemic [53][55] Question: What was the biggest inhibitor to growth in the last quarter? - Management noted that many companies were deferring decisions and initiatives due to the pandemic, impacting growth expectations [58][79] Question: Has there been any change in the supply chain perspective? - Management confirmed that while there were some delays, the supply chain is generally stable, with minor glitches affecting new product introductions [59] Question: What is the current cash position ahead of the recent announcement on the raise? - Management indicated that the cash position was above $3 million, including federal loan proceeds [60][62] Question: Has there been an increase in sales for the Blade as well? - Management confirmed that the M-Series products have seen stronger demand, while the Blade has participated to a lesser extent [66] Question: Can you elaborate on the price delta between the M400 and M4000? - The M4000 is expected to be priced around $2,499, offering advanced features that cater to different applications compared to the M400 [74]