Welcome!

Microsoft Cloud Authors: Elizabeth White, Mihai Corbuleac, Pat Romanski, David Bermingham, Steven Mandel

News Feed Item

Spectra7 Reports Record Revenue and Continued Strong Gross Margin for Q2'14

First Half Revenues increase to more than $2.0 million; Gross Margins Continue Strong at 76%

TORONTO, ONTARIO -- (Marketwired) -- 08/15/14 -- Spectra7 Microsystems Inc. ("Spectra7" or the "Company") (TSX VENTURE: SEV), a high performance interconnect company delivering unprecedented bandwidth, speed, and resolution to enable new classes of industrial design for market-leading consumer electronics, today announced its unaudited financial results for the three and six month periods ended June 30, 2014. A copy of the unaudited condensed interim consolidated financial statements for the three and six month periods ended June 30, 2014 prepared in accordance with International Financial Reporting Standards and the corresponding Management's Discussion and Analysis will be available under the Company's profile on www.sedar.com. All amounts are in US dollars unless otherwise noted.

Q2 Highlights


--  Commenced production of the Company's Virtual Reality VR7100 product
    based on design wins and subsequent purchase orders for use of the
    Company's product in leading wearable computing and virtual reality
    platforms to meet increasing consumer demand;
--  Continued to achieve milestones in pursuit of design wins for
    DisplayDirect™ with continued successful product demonstrations to
    leading tier-one flat panel OEMs;
--  Attained record revenue for the quarter of $1.1 million and exceeded
    $2.0 million for the first half ending June 30, 2014, up 44% year-over-
    year and 33% over the prior quarter;
--  Delivered strong quarterly gross margins of 76% for the quarter and for
    the first half ending June 30, 2014; an increase of 11% compared to the
    first half of 2013;
--  Expanded the Company's market footprint with the launch of
    CouchConnect™ for Gamers, a low latency, ultra-light active HDMI
    gaming interconnect that brings the power of mobile gaming on handheld
    devices to the a large screen HDTV; and
--  Closed the fully exercised over-allotment option bringing total
    aggregate proceeds of the Company's unit public offering to
    Cdn.$8,050,000.

"Spectra7 is at the cusp of a new and exciting growth phase driven by the global growth of wearable computing, virtual reality and ultra-thin high resolution displays," said Tony Stelliga, CEO of Spectra7. "Recent first market availability of leading consumer products featuring the Company's latest products underscore the Company's ability to rapidly deliver new products that enhance consumer experience. Our high performance analog signal processing capabilities and strong system expertise enable us to deliver on our vision of setting the industry standard for ultra-light, micro thin extended interconnects capable of delivering ultra-high resolution and dramatic consumer appeal of product industrial design. As a result, Spectra7 continues to demonstrate its ability to execute operationally to drive revenue growth and gross margin."

Financial Summary

The following table is a summary of the financial information presented in the financial statements:


                                                          Six months
                          Three months ended June         ended June

                                 2014         2013         2014         2013
                          (unaudited)  (unaudited)  (unaudited)  (unaudited)
                                    $            $            $            $
                        ----------------------------------------------------

Revenue                     1,145,992    1,110,046    2,007,734    1,395,487

Cost of Sales                 272,156      330,474      481,112      495,517

Gross Margin                  873,836      779,572    1,526,662      899,970
Gross Margin %                    76%          70%          76%          64%

Operating Expense           3,314,661    3,257,184    5,690,977    5,303,152

Other expense                 806,514      635,046    1,861,191    3,350,122

Net loss                  (3,247,339)  (3,112,658)  (6,025,546)  (7,753,304)

Revenue

Revenue for the quarter attained a record $1.145 million and topped $2.0 million for the first half, ended June 30, 2014 up 44% compared to the first half of 2013. Interconnect product revenue increased by 129% for the first half ended June 30, 2014 year-over-year and 24% over the prior quarter. This increase is driven by demand for active cable products for high resolution HD displays and by market availability of the Company's Virtual Reality products in market-leading VR platforms that commenced volume production in the quarter to meet consumer demand. Wireless revenue for the six month period ended June 30, 2014 was $0.309 million, 53% lower than the same period the previous year. This was due to the Company decision to refocus its resources on high growth revenue opportunities.

Gross Margins

Product gross margins remained strong at 76% for the first half, up 12% year-over-year as a result of improved product mix and higher margins for interconnect products with orders placed from the Company's new and existing customers.

Expenses

Operating expenses for the six month period ended June 30, 2014 are 7% higher than the same period in the previous year. While the Company has significantly reduced resources, the loss of eligibility for the Scientific Research and Experimental Development investment tax credits and the higher tape-out costs related to new products have resulted in operating expense increases.

On July 24, 2014, the Company commenced the closure of its Irvine, California office to allow the Company to further optimize interconnect product development and delivery efforts. Expenses in the third quarter of 2014 are expected to decrease as the Company integrates the Irvine location into the Company's Palo Alto Design Center.

Product and Customer Highlights

During the three month period ended June 30, 2014, the Company made significant progress to accelerate its product development as market-leading platforms with the Company's technology commenced volume shipments including:


--  Commenced production and shipments for the Company's DisplayDirect™
    Virtual Reality VR7100 product based on design wins and purchase orders
    to use the Company's product in leading wearable computing and virtual
    reality platforms;
--  Announced CouchConnect™ for Gamers, an ultra-light, active HDMI
    gaming interconnect that enables immersive, real-time mobile gaming from
    a handheld device onto a large screen HDTV at the E3 Expo, one of the
    largest virtual reality and gaming events in North America; and
--  Introduced the WR7100, the first chip of its kind to enable ultra-thin
    near transparent weavable interconnects that can deliver real-time deep
    color 4K UHD resolution from wearable visual systems to on-person mobile
    phones and storage devices, shortly after the end of the quarter.

ABOUT SPECTRA7 MICROSYSTEMS INC.

Spectra7 Microsystems Inc. is a high performance analog semiconductor company delivering unprecedented speed, resolution and signal fidelity that enables ultra-light, high-speed, micro-thin interconnects which enable new classes of industrial design for market-leading consumer electronic products including Ultra-HD 4K Displays and Televisions, Virtual Reality, Wearable Computing and Tablets. Spectra7 is headquartered in Markham, Ontario with development centers in Silicon Valley, California and Cork, Ireland. For more information, please visit www.spectra7.com.

CAUTIONARY NOTES

Certain statements contained in this press release constitute "forward-looking statements". All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the Company's future financial position and results of operations, strategy, proposed acquisitions, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words "believe", "expect", "aim", "intend", "plan", "continue", "will", "may", "would", "anticipate", "estimate", "forecast", "predict", "project", "seek", "should" or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company's expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company's annual MD&A for the year ended December 31, 2013. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contacts:
Sean Peasgood
Investor Relations
t: 416.565.2805
t: 416.565.2805
w: www.spectra7.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
Join IBM June 8 at 18th Cloud Expo at the Javits Center in New York City, NY, and learn how to innovate like a startup and scale for the enterprise. You need to deliver quality applications faster and cheaper, attract and retain customers with an engaging experience across devices, and seamlessly integrate your enterprise systems. And you can't take 12 months to do it.
This is not a small hotel event. It is also not a big vendor party where politicians and entertainers are more important than real content. This is Cloud Expo, the world's longest-running conference and exhibition focused on Cloud Computing and all that it entails. If you want serious presentations and valuable insight about Cloud Computing for three straight days, then register now for Cloud Expo.
IoT device adoption is growing at staggering rates, and with it comes opportunity for developers to meet consumer demand for an ever more connected world. Wireless communication is the key part of the encompassing components of any IoT device. Wireless connectivity enhances the device utility at the expense of ease of use and deployment challenges. Since connectivity is fundamental for IoT device development, engineers must understand how to overcome the hurdles inherent in incorporating multipl...
Machine Learning helps make complex systems more efficient. By applying advanced Machine Learning techniques such as Cognitive Fingerprinting, wind project operators can utilize these tools to learn from collected data, detect regular patterns, and optimize their own operations. In his session at 18th Cloud Expo, Stuart Gillen, Director of Business Development at SparkCognition, will discuss how research has demonstrated the value of Machine Learning in delivering next generation analytics to im...
Manufacturers are embracing the Industrial Internet the same way consumers are leveraging Fitbits – to improve overall health and wellness. Both can provide consistent measurement, visibility, and suggest performance improvements customized to help reach goals. Fitbit users can view real-time data and make adjustments to increase their activity. In his session at @ThingsExpo, Mark Bernardo Professional Services Leader, Americas, at GE Digital, will discuss how leveraging the Industrial Interne...
The paradigm has shifted. A Gartner survey shows that 43% of organizations are using or plan to implement the Internet of Things in 2016. However, not just a handful of companies are still using the old-style ad-hoc trial-and-error ways, unaware of the critical barriers, paint points, traps, and hidden roadblocks. How can you become a winner? In his session at @ThingsExpo, Tony Shan will present a methodical approach to guide the holistic adoption and enablement of IoT implementations. This ov...
SYS-CON Events announced today that Stratoscale, the software company developing the next generation data center operating system, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Stratoscale is revolutionizing the data center with a zero-to-cloud-in-minutes solution. With Stratoscale’s hardware-agnostic, Software Defined Data Center (SDDC) solution to store everything, run anything and scale everywhere...
Angular 2 is a complete re-write of the popular framework AngularJS. Programming in Angular 2 is greatly simplified – now it's a component-based well-performing framework. This immersive one-day workshop at 18th Cloud Expo, led by Yakov Fain, a Java Champion and a co-founder of the IT consultancy Farata Systems and the product company SuranceBay, will provide you with everything you wanted to know about Angular 2.
Digital payments using wearable devices such as smart watches, fitness trackers, and payment wristbands are an increasing area of focus for industry participants, and consumer acceptance from early trials and deployments has encouraged some of the biggest names in technology and banking to continue their push to drive growth in this nascent market. Wearable payment systems may utilize near field communication (NFC), radio frequency identification (RFID), or quick response (QR) codes and barcodes...
SYS-CON Events announced today that Men & Mice, the leading global provider of DNS, DHCP and IP address management overlay solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. The Men & Mice Suite overlay solution is already known for its powerful application in heterogeneous operating environments, enabling enterprises to scale without fuss. Building on a solid range of diverse platform support,...
You deployed your app with the Bluemix PaaS and it's gaining some serious traction, so it's time to make some tweaks. Did you design your application in a way that it can scale in the cloud? Were you even thinking about the cloud when you built the app? If not, chances are your app is going to break. Check out this webcast to learn various techniques for designing applications that will scale successfully in Bluemix, for the confidence you need to take your apps to the next level and beyond.
The increasing popularity of the Internet of Things necessitates that our physical and cognitive relationship with wearable technology will change rapidly in the near future. This advent means logging has become a thing of the past. Before, it was on us to track our own data, but now that data is automatically available. What does this mean for mHealth and the "connected" body? In her session at @ThingsExpo, Lisa Calkins, CEO and co-founder of Amadeus Consulting, will discuss the impact of wea...
Whether your IoT service is connecting cars, homes, appliances, wearable, cameras or other devices, one question hangs in the balance – how do you actually make money from this service? The ability to turn your IoT service into profit requires the ability to create a monetization strategy that is flexible, scalable and working for you in real-time. It must be a transparent, smoothly implemented strategy that all stakeholders – from customers to the board – will be able to understand and comprehe...
So, you bought into the current machine learning craze and went on to collect millions/billions of records from this promising new data source. Now, what do you do with them? Too often, the abundance of data quickly turns into an abundance of problems. How do you extract that "magic essence" from your data without falling into the common pitfalls? In her session at @ThingsExpo, Natalia Ponomareva, Software Engineer at Google, will provide tips on how to be successful in large scale machine lear...
SYS-CON Events announced today that Ericsson has been named “Gold Sponsor” of SYS-CON's @ThingsExpo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. Ericsson is a world leader in the rapidly changing environment of communications technology – providing equipment, software and services to enable transformation through mobility. Some 40 percent of global mobile traffic runs through networks we have supplied. More than 1 billion subscribers around the world re...
SYS-CON Events announced today that Fusion, a leading provider of cloud services, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Fusion, a leading provider of integrated cloud solutions to small, medium and large businesses, is the industry's single source for the cloud. Fusion's advanced, proprietary cloud service platform enables the integration of leading edge solutions in the cloud, including cloud...
The IETF draft standard for M2M certificates is a security solution specifically designed for the demanding needs of IoT/M2M applications. In his session at @ThingsExpo, Brian Romansky, VP of Strategic Technology at TrustPoint Innovation, will explain how M2M certificates can efficiently enable confidentiality, integrity, and authenticity on highly constrained devices.
There is an ever-growing explosion of new devices that are connected to the Internet using “cloud” solutions. This rapid growth is creating a massive new demand for efficient access to data. And it’s not just about connecting to that data anymore. This new demand is bringing new issues and challenges and it is important for companies to scale for the coming growth. And with that scaling comes the need for greater security, gathering and data analysis, storage, connectivity and, of course, the...
We’ve worked with dozens of early adopters across numerous industries and will debunk common misperceptions, which starts with understanding that many of the connected products we’ll use over the next 5 years are already products, they’re just not yet connected. With an IoT product, time-in-market provides much more essential feedback than ever before. Innovation comes from what you do with the data that the connected product provides in order to enhance the customer experience and optimize busi...
In his session at @ThingsExpo, Chris Klein, CEO and Co-founder of Rachio, will discuss next generation communities that are using IoT to create more sustainable, intelligent communities. One example is Sterling Ranch, a 10,000 home development that – with the help of Siemens – will integrate IoT technology into the community to provide residents with energy and water savings as well as intelligent security. Everything from stop lights to sprinkler systems to building infrastructures will run ef...