Vuzix Smart Glasses revenues for the second quarter increased
183% year-over-year
Overall revenues for the second quarter increased 98%
sequentially compared to the first quarter
ROCHESTER, N.Y., Aug. 10, 2020 /CNW/ -- Vuzix® Corporation
(NASDAQ: VUZI) ("Vuzix" or, the "Company"), a leading supplier of
Smart Glasses and Augmented Reality (AR) technologies and products,
today reported its second quarter results for the period ended
June 30, 2020.
"Our second quarter revenue grew 39% over the comparable 2019
period and 98% sequentially from our first quarter to $3.0 million as our enterprise business continued
to expand at an accelerated pace and engineering services sales
doubled to $0.7 million versus the
comparable 2019 period. The worldwide coronavirus outbreak has
impacted the day-to-day operations of our enterprise customers
across numerous market verticals and this has accelerated the
enterprise adoption of our smart glasses. We delivered a record
$2.3 million of Vuzix smart glasses
in the quarter, an increase of 183% year-over-year and 70%
sequentially from our first quarter of 2020, primarily driven by
interest from new customers and follow-on orders from existing
customers whose business operations have been impacted by
COVID-19. Healthcare has emerged as an important business
segment for Vuzix, including telemedicine and telehealth solutions
related to patient care, training and surgery, as well as
supporting healthcare companies like medical device manufacturers
that have active equipment installations in hospitals and medical
facilities," said Paul Travers,
President and CEO of Vuzix.
"The second quarter was also a good one for our OEM business
group. We advanced the existing programs we have with two major
global defense companies and achieved meaningful milestones on
their respective product development initiatives that should
accelerate the transition of these programs from engineering
services concepts to volume production in the near future,"
continued Mr. Travers.
The following table compares condensed elements of the Company's
summarized Consolidated Statements of Operations data for the three
months ended June 30, 2020 and 2019,
respectively:
|
|
For 3 Months
Ended June 30
|
|
|
(in 000s except
per share numbers)
|
|
|
2020
|
|
2019
|
Sales:
|
|
|
|
|
Sales of
Products
|
|
$
2,335
|
|
$
1,835
|
Sales of Engineering
Services
|
|
702
|
|
351
|
|
|
|
|
|
Total
Sales
|
|
3,037
|
|
2,186
|
|
|
|
|
|
Total Cost of
Sales
|
|
2,241
|
|
2,034
|
|
|
|
|
|
Gross
Profit
|
|
796
|
|
152
|
|
|
|
|
|
Operating
Expenses:
|
|
|
|
|
Research and
Development
|
|
1,796
|
|
1,987
|
Selling and
Marketing
|
|
797
|
|
823
|
General and
Administrative
|
|
1,800
|
|
1,804
|
Depreciation and
Amortization
|
|
641
|
|
608
|
|
|
|
|
|
Total Operating
Expenses
|
|
5,034
|
|
5,221
|
|
|
|
|
|
Loss from
Operations
|
|
(4,238)
|
|
(5,069)
|
|
|
|
|
|
Total Other Income
(Expense)
|
|
(1)
|
|
13
|
|
|
|
|
|
Net
Loss
|
|
(4,239)
|
|
(5,056)
|
Loss Attributable
to Common Stockholders
per
Share
|
|
$
(0.13)
|
|
$
(0.20)
|
|
|
|
|
|
|
Second Quarter 2020 Financial Results
For the three months ended June 30,
2020, total revenues increased $0.8
million to $3.0 million versus
the comparable period in 2019. The increase was driven by higher
sales of Vuzix smart glasses products, which rose 183%
year-over-year. Sales of OEM Products were nil for the three months
ended June 30, 2020 as compared to
$951,570 in the 2019 period.
Engineering services revenue was $0.7
million versus $0.4 million in
the prior year's period.
There was an overall gross profit of $0.8
million for the three months ended June 30, 2020 as compared to a gross profit of
$0.2 million for the same period in
2019.
Product gross margins before overheads and other items averaged
50% of sales in the 2020 period as compared to 24% in the prior
year's period. The improvement was primarily the result of higher
margins earned on the M400 in the second quarter of 2020 versus
those earned on the M300 series for the same period in 2019.
Gross profit for the June 30, 2020
quarter included a $0.3 million
obsolescence reserve taken for some unique Blade component
inventory in advance of the updated Blade model being released
shortly.
Research and Development (R&D) expense was $1.8 million for the three months ended
June 30, 2020 compared to
$2.0 million for the comparable 2019
period, a reduction of approximately 10%. The decrease in R&D
expense was primarily due to reduced external consulting fees
related to Blade software development as well as lower overall new
product research and development costs.
Selling and Marketing expense was $0.8
million for the three months ended June 30, 2020, unchanged versus the comparable
2019 period.
General and Administrative expense for the three months ended
June 30, 2020 was $1.8 million, unchanged versus the comparable
2019 period.
Total Operating Expenses decreased by $0.2 million for the three months ended
June 30, 2020, a reduction of
approximately 4%.
The net loss attributable to common stockholders after accrued
preferred share dividends for the three months ended June 30, 2020 was $4.7
million or $0.13 cents per
share versus a net loss of $5.5
million or $0.20 for the same
period in 2019.
Net cash operating loss after adding back non-cash items for the
second quarter of 2020 was $2.9
million as compared to $4.0
million for second quarter of 2019, a decrease of 29%. As of
June 30, 2020, the Company maintained
cash and cash equivalents of $13.2
million and an overall working capital position of
$20.1 million.
Management Outlook
"The COVID-19 Pandemic continues to show signs of becoming a
catalytic event for several technology-related industries,
including enterprise smart glasses. The disruption to
enterprise operations globally has acted as an accelerant for new
customer acquisition, order flow and order size," said Paul Travers, President and CEO of Vuzix. "Our
third quarter is off to a strong start in terms of smart glasses
revenue through the first month of the quarter and is continuing
the acceleration reflected in our most recent quarter's sales. As a
result, we believe we are in position to deliver continued growth
in the third quarter and over the remainder of 2020.
Healthcare, which emerged in the second quarter as an important
contributor of growth for Vuzix, continues to gain strength and we
expect this segment to be a major driver of growth for the Company
over the second half of 2020 and beyond. We anticipate
expanding the number of our contracted Engineering Services program
engagements and are continuing to pursue additional Engineering
Services and OEM programs, all with the goal of securing supply
agreements for large scale production of customized waveguide-based
HMDs and HD display engine products in the future."
Conference Call Information
Date: Monday, August 10, 2020
Time: 4:30 p.m. Eastern Time (ET)
Dial-in Number for U.S. & Canadian Callers:
877-709-8150
Dial-in Number for International Callers (Outside of the U.S. &
Canada): 201-689-8354
A live and archived webcast of the conference call will be
available on the investor relations page of the Company's website
at: https://ir.vuzix.com/
Participating on the call will be Vuzix' Chief Executive Officer
and President Paul Travers and Chief
Financial Officer Grant Russell, who
together will discuss operational and financial highlights for the
second quarter ended June 30,
2020.
To join the live conference call, please dial into the above
referenced telephone numbers five to ten minutes prior to the
scheduled conference call time.
A telephonic replay will be available for 30 days, starting on
August 10, 2020, at approximately
5:30 p.m. (ET). To access this
replay, please dial 877-660-6853 within the U.S. or
Canada, or 201-612-7415 for
international callers. The conference ID# is 13707615.
About Vuzix Corporation
Vuzix is a leading supplier of Smart-Glasses and Augmented
Reality (AR) technologies and products for the consumer and
enterprise markets. The Company's products include personal display
and wearable computing devices that offer users a portable
high-quality viewing experience, provide solutions for mobility,
wearable displays and augmented reality. Vuzix holds 166 patents
and patents pending and numerous IP licenses in the Video Eyewear
field. The Company has won Consumer Electronics Show (or CES)
awards for innovation for the years 2005 to 2020 and several
wireless technology innovation awards among others. Founded in
1997, Vuzix is a public company (NASDAQ: VUZI) with offices in
Rochester, NY, Oxford, UK, and Tokyo, Japan. For more information, visit
Vuzix website, Twitter and Facebook pages.
Forward-Looking Statements Disclaimer
Certain statements contained in this news release are
"forward-looking statements" within the meaning of the Securities
Litigation Reform Act of 1995 and applicable Canadian securities
laws. Forward-looking statements contained in this release relate
to, among other things, the timing of new product releases,
opportunities related to market disruption, R&D project
successes, smart glasses pilot to roll-out conversion rates,
existing and new engineering services and conversion to volume
production OEM programs, future operating results, and the
Company's leadership in the Smart Glasses and AR display industry.
They are generally identified by words such as "believes," "may,"
"expects," "anticipates," "should" and similar expressions. Readers
should not place undue reliance on such forward-looking statements,
which are based upon the Company's beliefs and assumptions as of
the date of this release. The Company's actual results could differ
materially due to risk factors and other items described in more
detail in the Company's Annual Reports and other filings with the
United States Securities and Exchange Commission and applicable
Canadian securities regulators (copies of which may be obtained at
www.sedar.com or www.sec.gov). Subsequent events and developments
may cause these forward-looking statements to change. The Company
specifically disclaims any obligation or intention to update or
revise these forward-looking statements as a result of changed
events or circumstances that occur after the date of this release,
except as required by applicable law.
Investor Relations Contact
Ed McGregor, Director of Investor
Relations, Vuzix Corporation ed_mcgregor@vuzix.com Tel: (585)
359-5985
Vuzix Corporation, 25 Hendrix Road, Suite A, West Henrietta, NY 14586 USA,
Investor Information – IR@vuzix.com www.vuzix.com
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SOURCE Vuzix Corporation