WISeKey International (WKEY) - 2025 H1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - For the first half of 2025, revenues grew slightly by $0.1 million to $5.3 million, reflecting a continued transition period ahead of expected growth in the second half [19] - Operating losses increased by $13.2 million to $27.3 million, largely due to a one-off stock-based compensation charge and increased investments in R&D and administrative costs [20] - The net loss for the six months ended June 2025 was $22.3 million, an increase of $6.8 million compared to the same period last year [21] - A strong balance sheet with a cash balance of $124.6 million as of June 30, 2025, allows for accelerated technological development and strategic investments [21] Business Line Data and Key Metrics Changes - The company is focusing on next-generation quantum-resistant chips, the SealCoin transactional IoT platform, and the expansion of the WISe.ART constellation [21] - The backlog of booked orders for 2026 is approximately 300% higher than at the end of 2025, indicating strong demand and confidence in future growth [19] Market Data and Key Metrics Changes - The company expects full-year revenues to be in the range of $18 to $21 million, driven by a return to growth in demand for traditional semiconductor products and the consolidation of IC'ALPS revenue [22] - A robust pipeline of revenue opportunities amounting to $170 million for the period 2026 to 2028 has been established, indicating strong market potential [17] Company Strategy and Development Direction - The company is executing a quantum convergence strategy that combines traditional identity security methods with emerging quantum-safe technologies [6][7] - Strategic partnerships, such as the QuantumX security initiative in Spain, are being developed to enhance shareholder value and create new addressable markets [13] - The company is also focusing on building personalization centers in various countries to reduce dependency on semiconductor supply chains [29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, emphasizing the importance of transitioning to quantum-resilient security solutions ahead of regulatory changes expected by 2027 [36] - The company is shaping the future of digital trust and cybersecurity, positioning itself to capitalize on the growing demand for quantum-safe technologies [17] Other Important Information - The Quantum Shield QS7001 chip, set to be launched in November 2025, aims to secure critical applications against quantum computing threats [8][9] - The company is pioneering the integration of post-quantum cryptography into its products, ensuring backward compatibility and avoiding disruption [6] Q&A Session Summary Question: Contribution from Quantix and revenue recognition - The project is expected to contribute $25 million over three years, with varying margins depending on the type of revenue recognized [24] - Product revenues are anticipated even before the center is fully operational [25] Question: Breakdown of the $170 million pipeline - The pipeline includes contributions from the Quantum Shield QS7001 chip, Trusted Platform Model (TPM) chips, and revenue from personalization centers [33][36] Question: Path to commercializing WISe.ART and SealCoin - The commercialization involves creating digital twins of secured objects and integrating SealCoin as a payment method for transactions between devices [40][42]