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bbotcs...sckt....wow. I would never have guessed it in a million years. They dropped expenses to record levels but revenue sucked. wow.
Jaybird...DYNT...I owned it a few years ago, buying in the $1 range right before it ran up to $2 (and then slid back down). The CEO kept using statements like "groundbreaking deal" concerning their connections with the GPOs. Turned out to be b.s. I don't follow them anymore so perhaps things have changed.
One thing to look for in the SEC form (I just looked it up again as I remembered it from years before)---A provision of Obamacare may hit them: Buried in their last 10Q, "An excise tax is assessed against sales, not profits. Therefore, even in a year when we may have no profits, we will still owe the excise tax to the federal government. Barring a change in the statute, we estimate that this tax would be approximately $300,000 to $400,000 annually based on current sales levels". For a company with as lean of profit margin as they have historically had, this tax could be all their profits.
Again, I don't really follow but something to think about.
Dave
The first big news is this: http://finance.yahoo.com/news/socket-mobile-gaining-momentum-mobile-204600583.html
The use of tablets by retailers is exploding. Socket is tied with 100 point of sale systems, including the largest ones, including billion dollar partners (NCR, Fujitsu, Casio, Panasonic). This whole industry is in it's infancy. Some of these retailers are mom/pop businesses and some are for national chains (ex. 3200 order with their partner, Fujitsu). Right now things are starting to move but's it's like the first batter in the first inning of a double header.
As for earnings, they will be released at the close of the market today with a conference call after.
I'm one of the larger shareholders of SCKT and I spend a couple of hours per day researching partners, tracking inventory through N.A. distributors, corresponding with other major shareholders of the company, gathering information, and learning about the industry as a whole and where tablet usage by businesses is going. I understand their whole business structure, how sales are done through distributors, their plans for the future..... I pride myself on being incredibly knowledgeable on SCKT. The CFO, as investor contact, is very helpful and honest. Tomorrow should be good. 1rst Q will surprise people. 2013 as a whole should blow people away. It's my #1 choice for an investment for 2013.
People don't realize the full extent that these new billion dollar partners---NCR, Fujitsu, Casio, Panasonic (plus all the other 100 point of sale partners combined will have on revenue). The key to remember is that these partners do all the work---sales, advertising, marketing---Socket just provides scanners. That's it. "Capture the developers of the software, let them do the sales for you of your hardware, capture market share". It's how a tiny company has gotten billion dollar partners to independently choose their scanner for their system over competitors like Motorola, Honeywell, Intermec. They are now doing the same philosophy with the Somo PDA side of their business. Combine it with expenses that they took a chainsaw to, the huge tax loss carry forward, the low shares (5 million under $3 and with all options/warrants exercised above $3 it's still under 7.5M fully diluted) and a lot of money will start hitting the bottom line.
Imo, tomorrow should be the first day in a long future history of good news.
OTIV vs SCKT technology: These are like comparing apples and cucumbers---not even two different fruits. The OTI product is aimed at consumers. It allows them to attach a device to their smartphone to let them pay for products at select retailers (who have the corresponding hardware) electronically from their phone by swiping it without having to use cash or credit card. Socket's barcode scanner is for businesses to use in checkout scanning and inventory.
People don't realize it, but the normal electronic cash register at your local hardware store costs thousands of dollars, a computer server in the back room, all the wiring, and high monthly costs. Mobile point of sale is the future---it's cheaper, expandable, and allows for interaction with the customer by employees, especially when tied into the cloud. ex. I go into my hardware store and can't find something. I ask an employee if they have such and such skill saw in stock. He pulls out his iPod or tablet and looks up the stock immediately. He tells they don't have it but he can order me one right there and have it shipped to my house. Option #1: I say great, he does it, I pay him with my credit card right there and the transaction is done. Option #2: I say, don't worry about it, and take my stuff to the main cash register. There they are using an iPad set up to a cash drawer, printer and barcode scanner. He then uses a Socket scanner to scan my items quickly and I can pay him with my credit card just like normal or I can use a device like OTI and swipe my phone to the special terminal and pay for it that way.
OTI: They will compete against Square here. That's an 800lb competitor. Square is focused mostly on making it easy for the consumer to pay with his smartphone. An example is the system they put in Starbucks. Square is not focused on providing the hardware or software for the business to run their terminals or organize their business.
Socket: Socket is teamed up with 100 point of sale developers who are going after the business end of things. When the employee needs to do inventory with his iPod as he's walking around the store, he can use a dedicated barcode scanner (the camera scanner is not adequate for this type of operation). The main player for type of employee is Linea Pro that offers a sled that attaches to the iPod that allows barcode scanning and credit card scanning. Don't be surprised if Socket goes after this option themselves.
The iPad/Android tablet as a cash register is where Casio, NCR, Fujitsu and the majority of point of sale software is going after. They will provide the hardware and software to run your whole business and use the cloud as a server. It simplifies business and lowers their costs tremendously. Once you are sending data into the cloud, you can do inventory with tablets/iPods in the store and send that there. You can connect up with customers electronically for coupons and e-mails. This if the future and it's expected 80% of all businesses will be using tablets in the next 5 years. The number one player for the barcode scanner used in these hardware packages is Socket for various reasons I won't get into now. Socket is being used by multiple billion dollar partners going after this emerging market. When Fujitsu sold their hardware/software/support tablet based point of sale package to a major national retailer in Japan, it's why Socket is now sending them 3200 scanners to go with it all.
The future of retail is mobile based point of sale, whether it's checking out employees in the aisles or at the main register. There are multiple players here. I'd highly recommend looking into this more as it's going to produce some big winners. Tablets and smartphone use by consumers has gone exponential. Only now are businesses starting to use it.
SCKT: Verifone ($3.7B) + Fujitsu ($8.7B) + Socket?!?
Could this be the system that Fujitsu used recently at a Japanese retailer that incorporated 3200 Socket 7ci scanners?? Probably is a good guess imo. First of many I'm sure. This is the power that partnerships with companies the size of Fujitsu, NCR, Casio (+100 other point of sale systems) will have on the future of scanner sales for Socket.
In November 2012 news release by Fujitsu:
Fujitsu GlobalSTORE Arms Retailers with Tablet and Smartphone-based Solution
Mobile POSVeriFone Systems, Inc. (NYSE: PAY), and Fujitsu have entered a partnership agreement to offer retailers sophisticated mobile retailing solutions powered by VeriFone GlobalBay and integrated with the Fujitsu GlobalSTORE® solution, or as a standalone mobile point of sale (POS).
The co-branded solutions provide Fujitsu retail customers with a sophisticated mobile POS, enabling retailers to serve consumers from anywhere in the store. They feature support for advanced mobile payment acceptance, including digital wallets and alternative payments.
SCKT...It's official = latest pr shows 100 Point of Sale Systems
http://finance.yahoo.com/news/socket-mobile-gaining-momentum-mobile-204600583.html
Not all of this are as big as NCR ($4B partner with NCR Silver) or Fujitsu (($8.7B partner with their Android tablet system) but they will add as the point of sale explosion takes over retail.
Again, they cut expenses in the 4th Q with a CHAINSAW. All of this is going to hit the bottom line sooner than people expect. A 40% gross profit margin, limited expenses due to partnerships, and a low float is going to make this stock a winner imo.
SCKT, $1.60 +23% today. Point of Sale systems
An associate I know talked with the CFO yesterday. There are now over 300 developers creating products that incorporate the Socket scanners. 100 of them are Point of Sale Systems. If you aren't familiar with POS, it's the next big thing for retail. As these developers grow their businesses worldwide, Socket just goes along for the ride----no advertising or marketing costs, just deliver scanners. In my opinion, it's going to make them very profitable in the near future.
Dave
SCKT... Socket Mobile's expanding list of POS partners
Socket in their latest advertising is stating that they have the #1 scanner for tablet based POS systems. It's believable in that they have their scanners being used by NCR, ShopKeep, LightSpeed, Casio Electronics, eMobilePOS, Raymark, StarMount, Registroid....... It you haven't researched the growing use of tablets for cash registers and employee connections with customers, you should. It's one of the biggest industries forming right now. As these partners grow in size, it only means more sales for Socket's scanners.
Dave
SCKT....record scanner sales continue.
January is historically the weakest month of the year. Not this year. I'm able to track part of the inventory at N.A. distributors for scanners (through different online retailers that I know calibrate to distributors) and what I saw in November and December isn't slowing down. It's only a slice of the overall pie however my communication with the CFO indicates it's indicative of what's happening everywhere domestically and internationally.
As I've said before, when this is combined with the chainsaw they took to expenses, the company will be solidly net income faster than people realize. Also, tablet based applications for business (including point of sales systems) are just starting. If Socket can become net income now, then later they will be grossly so.
SCKT, Socket and National Retail Federation highlights: Socket was in attendance (not showing but connecting with partners). On Socket's twitter and FB page they have pictures of their scanners being shown with tablets in NCR Silver's booth, Fujitsu America (with their Stylistic Tablet and retail mobile app software), ShopKeep, Lightspeed, StarMount retail, Raymark retail, and even on the Intel mannequin. https://www.facebook.com/photo.php?fbid=466121236783529&set=a.466121136783539.110403.143765292352460&type=1&theater
Scanner sales are only going one direction here and that's upward (and from what I've seen in my inventory tracking, it's already starting to roll and it's only the first inning of a doubleheader imo. What I saw in November and December has not slowed down one step in January---and January is historically the weakest month of the year---not anymore). It's obvious more and more partners are using Socket's scanners. The plus with all of these point of sale system partners is that as they grow in size it means they will sell more and more scanners each and every month.
On expenses side, I've also heard they took a CHAINSAW to expenses and cut them to levels that are unheard of in this company's existence. The two combined (increased sales and reduced expenses) are going to surprise people here very soon.
bbotcs....SCKT...predictions for 2013
As you know, I'm not real comfortable posting all my research on a message board (I'm happy to share privately), but I will say this....
4th Q 2012: I see them being cashflow positive based on a record quarter of scanner sales (sales from Nov and Dec for the inventory I track at their US distributors made a huge jump in numbers) and them taking a chainsaw to expenses and cutting them to levels this company has never seen before.
1rst Q 2013: Not only do I think they will be net income positive, but nicely so. People will be shocked.
SCKT..NCR expands relationship, scanner sales increasing fast
In their last blog, Socket management discussed how they now have 230+ developers signed up to use their SDK (software development kit) to integrate into their product to use Socket scanners.
"If you look at the number of Apple based POS solutions that are recommending or bundling our scanners, it's apparent that the Socket CHS is becoming the de facto standard for barcode scanning for iPad based retail POS solutions."
I found out today that on January 3rd, NCR is expanding their relationship with Socket to include their Counterpoint Mobile software in addition to their NCR Silver product. It shows that Sockets software+scanner products are widely accepted.
But what about sales you say??? In the 3rd Q, Socket did their usual blow out disappointment numbers! Of course. Two positives from this though. One is they have cut expenses BIG TIME. Also, I track inventory at the U.S. Distributor level. (If someone is really interested here they can private message me and I'll tell them exactly how it's done). In October I saw sales at the same weak level as July, Aug, Sept. However, once the IOS 6, iPhone 5, iPad 4, iPad mini debacle was cleared and all the apps approved for new products, sales have never looked back. November was the best month I've ever tracked and was 60% better than October. December has already exceeded November! The key will be to see if January grows on the trend (or drops back a bit due to it being the first month of the quarter). If sales continue to grow in number and $$, then we've got a winner here.
I also know of multiple large deals that are being discussed. If Socket were to sign them, then this stock will be the #1 winner in 2013 imo. If someone is really interested in more info, pm me.
Dave
SCKT....bbotcs....NCR Silver is in around 1/2 of the Staples stores starting this week (980 stores were supposed to receive shipment). I expect them to be in all the stores close to the end of the month. I've also heard that Office Depot and Office Max both will be coming. I read a blog on independent point-of-sale resellers and they are very worried that NCR Silver is a game changer for the industry and themselves. It's pretty much a "give the hardware away for free" and sign the business up for credit card services to make your money. NCR Silver has more upgrades coming I hear (including helping businesses tie themselves into YouTube, Facebook and customer coupons). It's not just a product for sales, but to run your whole business. The Socket scanner is being pushed hard on customers when they call NCR up to register the hardware and initiate the software.
Socket is definitely cutting it close but I still believe they will pull it out. The deal with NCR alone is more than enough to turn their entire business around.
Go to your local Staples store and check it out. The product is on the end of the aisle at the front. There is a demo model and a in-a-box hardware underneath.
SCKT...NCR Silver product is going into all 2300 Staples.
Yes, Socket's last quarterly numbers sucked beyond imagination. It stunned me. I've since talked to management and it's not an indicator of what's coming.
Today NCR announced that their NCR Silver point of sale product will be in 2300 Staples stores by the end of the year (end of aisle, front of store location). The only barcode scanner option available is Socket's 7ci. I contacted NCR Silver today and asked about other stores. The reply was to expect them in Office Depot too soon. That's 3300 stores and growing by 1rst Q. I doubt Socket's scanners will be on the shelves, but if you want a barcode scanner, you have no other choice than to order a Socket one online (NCR gives it their own 24 hour replacement guarantee if anything goes wrong).
Let's put this in perspective: NCR chose Socket's scanner (I know from conversations that NCR came to Socket for the partnership, not Socket selling the idea to them). They like the scanner and want to build a long-term relationship. NCR is a $4.8B company choosing a $5M partner. If Socket was 1" then NCR would be 75 feet!
Yeah, Socket's last quarter sucked but that doesn't mean the story died with it. They have signed 120 new developers in the last 90 days for scanners. The CFO told me that NCR isn't the only big partner in the future. Just be patient.
SCKT: NCR Silver-- Socket scanner---Office Depot deployment
NCR intends to become an 800lb gorilla in the mushrooming use of tablets for cash registers for businesses. They use the iPad now and will have Android tablets also early next year. From their investor presentation earlier this year, they aspire to sell 10K systems this year, 120K next, 360K the year after. That tells you the growth here.
Today they had their conference call. They sold several hundred systems in the 3rd Q as they were only just starting to ramp up. They continued to build the infrastructure for growth. They now have 2600 sales reps contracted and another 7800 in the pipeline.
An exciting avenue of growth is that they are going to put the NCR Silver system on on the shelves on a "prominent endcap" at over 1000 office retailers next month (I'm assuming it's Office Depot since they have 1100 stores). I wouldn't be surprised to see it at Staples and Costco soon (NCR mentioned Costco in an earlier conference as a possibility).
Socket mobile provides the only barcode scanner for the NCR Silver hardware package. It will be interesting to see if the scanner shows up on the shelves also (I wrote the CFO and he said "can't really comment" but also "don't be surprised if the answer to my question became public knowledge soon")
Next year: 120K systems sold. Even if only 1/3 buy a barcode scanner (very helpful during checkout with the iPad at the sales counter), that's a lot of money for small company like Socket (only 5 million shares outstanding now, 7M if fully diluted by options and warrants). This is only one customer. Socket now has over 160 partners (very large and lots of small ones) who's software is designed to use with the scanners. Remember--these partners spend all the advertising and marketing money, Socket just needs to be a good supplier and ship product!
Also an interesting note: Socket's scanners are the choice to use by a $4.8B company. They beat out Motorola's tablet scanner. It tells you that they are good.
Somo side of the business: I know more here. Contact me if you'd like to hear the positive things happening here.
SCKT...Partnership with ShopKeep just got more interesting.
Today, ShopKeep (an up-and-coming player in the use of the iPad for retail point of sale systems) announced that they are bundling their hardware and software in a "one box" solution and allowing BlueStar Distribution and their 16,000 associated businesses to offer it as a package to their customers. This is similar to NCR teaming up with ScanSource Distributors. It's good to see ShopKeep getting very aggressive in going after this emerging market.
The kit includes stand, cash register, printer. For accessories they can go to the website. ShopKeep offers two barcode scanners for customers to use: The Socket 7M (for 1d scanning) and the Socket 7xi (for 2d scanning).
In time the use of iPads/tablets by businesses in replacing their registers, for use in inventory, and for in-store customer interactions is going to mushroom into a billion dollar plus market. Socket is involved with several of the big players.....NCR, ShopKeep, Lightspeed, Registroid.
Earnings will be out around the 23rd of Oct. It will be interesting to see how scanner sales have done. As for the Somo PDA side of the business.....I've heard very good things there but will leave that be for now.
SCKT....NCR deal could be a monster partnership:
I just listened to the 4 hour investor presentation by NCR that was done on May 16th, 2012. They went through all aspects of their business. The described NCR Silver as the "biggest innovation the company has done in 100 years". The CEO is hyper-aggressive in wanting to capture what they see as a market of 4 million small business in the U.S. (and 8 million worldwide) for a product like this. They are spending millions on data centers and refining and improving the product. They eventually intend to grow sales of the product through over 10K sales representatives, including pairing up with major banks, distributors, merchandising networks, and on the shelves of major retailers where small businesses buy products (he tossed out the name Costco as an example). When NCR first started they had 90% of the cash register business 120 years ago. The CEO's dream is to do that again (that's them saying it).
Here are their goals:
2012: Product launched in July, aspired goal is to have 10K customers by the end of the year.
2013: Finish the year with 120K customers.
2014: Finish the year with 380K customers.
These numbers show you what the use of tablets for Point of Sale is going to be going forward in this industry. Socket's scanners are a major player.
Every customer is given the option of buying a pre-packaged kit which includes a cash register, stand, printer (and optional Socket Scanner). NCR will guarantee the hardware with immediate replacement from their 24/7 live service centers. Right now it's used on the iPad. NCR is going to make the software to run on Android and Windows based tablets too by the end of the year.
In the presentation they compared NCR Silver to 3 competitors: Square (which I know has no barcode scanner), Revel (which uses the Motorola scanner), and ShopKeep (which also uses the Socket scanner as their choice!).
Obviously, not every retailer needs a bluetooth barcode scanner but it sure is helpful for checking out products and doing inventory with. Socket earnings will be released in less than 3 weeks. I will be on the conference call getting them to elaborate on the future potential of the scanner side of the business.
NCR Silver: http://ncrsilver.com/
SCKT...new scanner models coming...7di/7diRX
In my tracking of inventory, I found where the company is introducing two new scanners (available in early October---distributors have just posted their SKU #s and indicated they will be receiving shipment), the 7di and 7diRx. I contacted the company today to ask about them. They are the 7ci model upgraded with the more rugged case of the 7xi/7xiRx. They are doing this to give customers a 1d scanner that is more rugged for warehouse situations and environments and a 1d rugged scanner that is anti-bacterial for the healthcare industry. They will be Apple Certified. They will cost about $50 more than the 7ci model. The video on YouTube that was released last week (where Tim Miller is tossing the unit up in the air and against the wall) is to show how rugged the 7xi and 7di are.
It's an easy upgrade for them as they already have the components and provides their customers with more options. I didn't get a response back on whether or not there will be a press release. I assume it will be next week---you just get it early here cause I like to research SCKT a lot. (When the 7xi was announced in 2011 the stock price went over $3.50 on 500K shares. When the 7ci was announced in spring 2012, the stock price again went over $3.50 on 300K shares. Not sure the stock market environment is such for another move like that. Probably not).
On a diff note to emphasize how valuable the relationship Socket Mobile has with NCR using their scanner: I read in an article from last month where Christian Nahas, vice president of NCR’s small and medium business team, explains that the company feels that there are 4 million small business owners that are going to be looking to tablet based POS systems in the next few years. They hope to be able to capture 20% of that number. They will be coming out with an Android based software system around the first of the year. They provide 24/7 service and overnight hardware replacement guarantee plus their first license fee is $79/month, but if you add in additional units then it's only $29/month extra for them.
SCKT....NCR Integrates Socket Barcode Scanner Into Apple(R) iPad(R) Based Point of Sale System
The CEO of Square just gave a presentation where he sees a huge percentage of business turning to iPads in the next two years as a point of sale system. Not just for the savings, but also for the use of tablets for customer interaction, inventory, and mobile integration. http://www.mactrast.com/2012/09/squares-rabois-retailers-will-replace-registers-with-ipads-within-18-months/
So far Socket has beat out the competition (and that includes Motorola) to integrate their barcode scanners in Lightspeed, NCR, ShopKeep, Registroid, Padalog point of sale systems. It's only going to grow. If Socket is good enough for NCR (a $3.8B company) and Lightspeed (backed by $30M from one of the most successful venture capitalist funds there is), then their scanner can get into anyone's systems.
http://finance.yahoo.com/news/ncr-integrates-socket-barcode-scanner-103000679.html
As for the Somo side of the business---nothing to really report there, but I hear good things are coming.
SCKT...great new partner using their scanner for iPad point of sale systems.
I'd noticed NCR Silver was being followed by Socket on their Twitter account recently. A little more investigation shows that their new NCR Silver Point of Sale system for the iPad that they just debuted uses the Socket 7ci scanners as the bluetooth scanner choice.
http://ncrsilver.com/
http://ncrsilver.com/get-started.html
I'm sure there will be a press release later. I know these things take time for Socket to get approval for (a lot of other companies don't want to be an advertisement for them).
NCR, by the way, is a $3.8 BILLION dollar company! Do you think they will be successful in selling their new point of sale system?
Hegotgame....
People may not get that excited at the press releases put out but it's because they don't see the bigger picture. One year ago they released the 2d Apple Certified scanner. 5 months ago they released the 1d version. Right now they have close to 100 companies with software that use these scanners and it just keeps building and building. What people don't realize fully is that these partners will do all the marketing and selling of their software (with the scanner added in) and we have zero expenses in that area. Socket just has to deliver the units. Not every partner is big but they add up. It's an incredibly profitable leveraged business plan. We just need to reach "critical mass" of partners and after that all revenue will just hit the bottom line big time. Tablets are becoming a HUGE growth area in businesses. Socket is not going after the customers----they are going after the developers! It makes it so a small company like Socket can compete with Motorola. You control the developers, you control the market.
On the Somo side, the new unit 655 model is where the scanners were partnership wise 6 months ago. We have established customers already but there are a slew of new partners demoing the units and planning on incorporating them into sales in the future. It should start playing out in the 4th Q. I do know the new SDK software package to help developers is coming out around the end of September. (ex. Good Sam Hospital wrote their own software for the hospital in conjunction with Ingram Micro. They later bought 3000 units from Socket). Plus, there are a multitude of former HP iPaq customers looking to run their software on the units too. This side of the business hasn't gotten a lot of good press in awhile but it is coming.
6 months from now people are going to shake their head at why they didn't buy when it was in the low $1s. I don't think you could get it there anymore even now. If you talk to the company they will readily admit that in 20 years they have never been more excited going forward than they are now! They let the stock drop from the Nasdaq to the OTC market because they spent too much in developing their newest products (and their biggest customers decided to hold off in purchasing the older ones as a result). It's better than them having diluted the shares 20% to a vulture fund just to keep shareholder equity up to stay on the Nasdaq (they will tell you they would never have done it at the current prices when they are so close to seeing the turnaround occur). They did do a small internal capital fund raising just to make sure they can go after large orders.
SCKT....kozuh....there have been a bunch of partnerships involving their scanners lately, but one that stands out is the relationship with iPad Enclosures and Warehouse Management Systems. It's not in a press release, but I found out they just debuted their new iPad warehouse product in August using Socket scanners.
http://www.ipadenclosures.com/blog/posts/ipad-case-wms-partnership
iPad Enclosures is the growing player in the POS industry that has done installations from LL Bean to the kiosks at Apple conferences. They are everywhere.
Warehouse Management is a creation of iPad Enclosures parent company, ArmorActive, as a joint venture with HOJ Engineering and Boxworks.
The first customer this product was installed at was Xpedex, the leading business to business distributor of packaging, facility and printing supplies in North America. The opportunity for the use of iPads in warehouses is huge. The best thing is any sales involves scanner deployments of decent number.
On a scale of 1 to 10, I'd put their partnership with Lightspeed at around 10 for the future potential. I'd put their partnership with iPad Enclosures at around 8 now that they are going after the warehouse management market.
Kozuh...SCKT.... I actually have bought $15K+ in shares in the low $1s recently. It's a no brainer. The price is based on them failing as a company? Why? They have no debt that has payments other than the current $400K that management just coughed up (which has a conversion at prices 2x current). They have a great relationship with their supplier so that's not an issue. The stock is down cause they went from the Nasdaq to the OTC market. They spent more cash on the Somo 655 than they expected (and the transition time has hurt them on sales). It's better than them selling 20% of the company to a vulture fund cheap (plus warrants for future growth) to keep the Nasdaq listing. It's taking the company a VERY LONG time to get to the "starting line", but the race should start to get good here soon.
For 3rd Q, the CFO (who I've talked to) still believes they will reach cash flow positive (close to $5M in sales). I'm pessimistic based on their past. It's dependent on strong sales in Sept (the 3rd month of each quarter is always their strongest). But by 4th Q, the Somo 655 will be appealing to a lot of new clients who are demoing it and the scanners will be building with partners too.
I thought the company looked good 12 months ago. I didn't realize that they really needed the 7ci scanner (a 1d scanner to appeal to retail businesses) and the Somo really needed a new model to let companies buy it knowing it's viable for 5 years. Management though pushed R&D hard and planned for it. Now it FINALLY should start playing out.
Kozuh...SCKT news... CBORD is a subsidiary of Roper Industries (a $10B Fortune 500 company). The Roper CEO in the last conference call said that division was doing record revenue. What they have done with the Socket Somo is further demo it and approve it for pretty much all their software product. The fact they expanded the use of it means, imo, they like it as a choice for customers. The PDA fits the same criteria as the Hp iPaq used to.....namely it's cheaper than the "real" rugged PDAs out there at $1000+, but it's more rugged than a flimsy iPod Touch/smartphone. There is a niche here and Socket fits it (especially in healthcare, long-term care facilities, food service).
It's just one more partner that they are adding in. The new Somo 655 should help build them. The plus to their business plan is it's partner based---the more Roper uses their Somo unit, the more the company makes with almost no increase in overhead. It's how they can go from $4M in revenue to $8M in revenue on only a couple hundred thousand in expenses.
It's just taking frickin' FOREVER for them to get it all going. One thing people forget here---their largest customer, Alere with their Epoc Blood Gas analyzer, hasn't been ordering from them this year. It's taken time for the product to break into hospitals (the Alere CEO on the last conference call was much more optimistic). They should be back ordering from Socket in the 1rst Q. What it means is if SCKT can get to 1 cent/share net income profit in 4th Q (which they have a great shot at or better), then when the Alere contract kicks back in (at $500K+/qtr), all that money will hit the bottom line. Socket can go from being "break even" to 5-7 cents/qtr profitable in a qtr (and that assumes no other growth). With additional growth, it's easy money for them. It's why management put up their own money recently rather than sell shares to a vulture fund---they are major shareholders themselves (and underwater too!) and weren't giving away the company when they are so close.
The big impact imo on the short-term: Watch the video on the main page of Lightspeed: http://www.lightspeedretail.com/ It is the first product out there that does cross selling (namely, you buy a dress and the sales rep shows you it in diff colors and matching accessories). It's being used at Nordstrom's Treasure and Bond store in NY. Tell me that wouldn't appeal to every high end retailer in the world. It's why Accel Partners (lead investor in Groupon, Facebook, Rovio.....) bought into them. They are going after national chains with their iPad product. That product is tied directly with the Socket 7ci scanner. It will take time, but this will be huge for the company. (Shopkeep, another iPad POS company changed from Motorola scanners to Socket right after Lightspeed went with them).
Socket's management gets a bad rap. Deservedly so, but they have had the foresight to build some incredible products. They just need to find the right partners to go forward with.
On a slightly diff subject: On the last CC Call, management stated they have determined that there are 1M+ Hp iPaq 210/211 units out there currently (the Somo is a perfect replacement for them and is actually recommended by HP). A lot of those companies will change technology, but for some of them, a semi-rugged PDA that runs their current software is the logical choice (ex. hospital that uses the units for inventory, patient scanning, medicine record keeping). Apple is exciting until the battery dies in the middle of a shift and then you are screwed since you can't replace it. There is a niche here and, like CBORD has found, a PDA like Somo fits it nicely.
Kozuh....SCKT.....newsletter. Management is very excited about the future. They are supposed to have a bunch of announcements coming. We'll see. One thing they did is to get Accelerize New Media to start to highlight them (so they can get a following with better newsletters and bloggers in the future as sales build). There scanner side of the business was just highlighted this morning: http://theotcinvestor.com/socket-mobile-sckt-positioned-to-be-key-supplier-in-next-generation-retail-environment-3463/
Obviously it's not a high quality newsletter but then again it gets the ball rolling. Accelerize will broadcast out their new announcements in the future too.
Kozuh...SCKT... lol. Yeah, I've been hiding! I'm as ill about it as anyone else. And, yes, I've been averaging down a bit (though I will have more money in a couple weeks to buy even more shares). What killed them is having to go from the Nasdaq to the OTC market. I've been in discussion with management quite a bit (Dave Dunlap, the CFO, is very open to shareholders and encourages them to contact him). Getting the new products out (7ci scanner and Somo 655) cost them too much cash and transition from 650 to 655 for the Somo reduced expected sales and kept them under cash flow positive. Nasdaq was very strict. The only way they could of stayed on was to sell a ton of shares (to raise equity) to some vulture fund and management has no intention of screwing themselves this close to making it work---they didn't even look into a deal.
I was adamant to them that management show some type of support with the stock price down. I wanted insider buys on the open market. They responded with a debt conversion for $400K with shares convertible at $2 or $2.44. They did give themselves some stock options too (not much). I was told they did not need the working capital but this is the route they went to just add to working cash so they can go after potential big deals (which there are supposed to be two of in the scanner side of the business coming in Sept).
Kevin, CEO, bought $400K shares at $2 three years ago so he has a real incentive to make it succeed (plus his options are underwater). Charlie Bass, founder, has lost even more money on shares he's bought over the years. It tells you he still believes when he just ponied up $250K in a loan to the company. I still would like to see him buy shares in the open market.
The scanner side of the business is looking good. They keep building partners. Their new SDK software is innovative. This quarter it should finally show the payoff. A killer deal is they teamed up with Lightspeed. A very very successful venture fund just gave them $30M and plans on making Lightspeed a $1B business (Accel Partners-- http://pandodaily.com/2012/06/11/accel-invests-30m-in-lightspeed-and-the-top-vc-was-the-one-doing-the-wooing/ ) Socket's 7ci scanner is sold with the software. It should help tremendously in the future.
The Somo 655 transition is almost complete. 650s are just about gone and the 655 inventory is building. There are supposed to be some partnerships announced here too and they are looking for some big deals late in 3rd Q or 4th Q that will aid the company tremendously. I've been told a lot of new customers have been waiting for the new model and after they are done demoing it, Socket expects them to buy big.
The company is 1 year behind where I thought they would be last year. I still feel very good about it (other than the stock price). They HAVE to get to cash flow positive (or very very close to it this quarter) and HAVE to get to net income positive in 4th Q or otherwise no one will believe them anymore. The CFO is insistent they will. We'll see.
I've posted a lot over on Yahoo on what I've learned from management and research. I just don't duplicate it here as I wasn't sure how many people were interested.
bbotcs...SCKT....no, 2nd Q won't be amazing. It does mean that we will get a sense of what the combination of a continued growing scanner division + a renewed/growing Somo division could mean to the company. That alone may push the stock price up a bit in anticipation as 3rd Q would give 3 months of Somo sales (the Somo unit won't be available to Europe till early 3rd Q) and more sequential growth from scanners and finally give a solid indication of where this stock is going to go.
Lots of "ifs" still. It's been a frustrating investment, but the opportunity for a large price appreciation still exists.
SCKT... Follow up information with CFO.
Their scanner business is growing sequentially and so there is no worries by myself there. I contacted the CFO cause I still worry about the Somo side of the business.....namely, where is the orders from former HP iPaq customers?? 4th Q results disappointed and I don't think 1rst Q numbers will be exciting either for this division (though scanner sales will be up sequentially again and keep growing as the number of apps grows). The new Somo 655 that will be available in June is exciting but will it matter? It got me thinking though and I contacted the CFO and asked when did the company start telling customers (in non-disclosure agreements) that this product was coming out? Turns out it was way back in the fall. They were concerned about selling Somo 650 units to large customers (and new iPaq customers) and then turning around and putting out a new upgraded unit 6 months later. They knew that customers wanted the upgrade already and wanted to be sure the company was going to support whatever product they bought for the next 5+ years. What Socket has found is that a large portion of these customers decided to hold off on orders in the 4th Q and instead wait to demo/evaluate the new 655 unit this spring. They currently have demo units in the hands of a lot of customers now. They have just started taking pre-orders for when it is deployed in June. Socket has already been told by many large customers that they have timed their HP iPaq replacement buying with the debut of the Somo 655.
I think 1rst Q numbers at the end of the month will not be exciting. What's important to look for: 1. How much did the scanner business grow sequentially 2. More updates on large customer demo programs with the Somo 655.
Manny T...SCKT... imo, it's another small step forward to keep their scanners on the forefront of the increasing use of tablets/smartphones for inventory. EX. Warehouse employee using a tablet to scan inventory. It's chilly there (warehouses in WA aren't usually heated very warm) so the worker is using thin gloves. Scan a product (and because of the 2nd patent, Socket scanners are Apple certified and allow the keyboard and scanner to work at the same time), he can then just punch in "15 units" without taking off his gloves (touch screens need a conductive surface---like skin---to work or a stylus). You aren't doing that with a Motorola scanner.
It's a little thing but makes sense.
Littlefish.....I'm happy to see the price increase, but not that excited. I'd rather see the price go up on a big increase in revenue and net income than a headline. But it does bring more "eyes" to the stock and that's always a good thing for a low float company.
Stock_peeker... all their scanners work on Android, Windows, and Apple already. Today's announcement is just the additional Apple level scanner. When I talked to the CFO, he said they currently have partners writing apps for 20 Apple products and 15 Android products. (They had an additional 65 SDKs currently sold where they haven't had the buyer contact the company for their free 10 hours of technical help---this is when they usually first hear of what the developer is up to).
Socket gives developers $5 for every new scanner sold that is registered. This is a real plus imo to encourage developers to use their product exclusively.
SOMO 655... the market for stand alone PDA's is decreasing. No question there. On the other hand, there are a lot of business uses where a tablet or phone is inappropriate. Plus, hundreds of millions of dollars worth of iPaq's are currently being used (The estimates I received are was the iPaq market in the US was $125M in 2009 and $90M in 2010). The iPaq was sold worldwide. It's not just changing hardware, but also software if you go a different route (plus teaching employees a new interface). In a lot of cases it's easier to just buy a replacement unit (which Socket has but with increased WiFi and memory and operating system). I will agree with you here that there are concerns here. This is where my worry with SCKT lies. The sales of Somo units in 4th Q disappointed me (that was the Somo 650). Management said they felt a lot of customers want the upgrade vs buying another product that is going to be replaced (pretty much what happened to them with the iPaq). 2nd Q will tell us a lot of what the potential here is.
bbotcs...SCKT...with 4.8M shares outstanding (and 6.9M if all options and warrants were executed) and a 43% profit margin (and low overhead), the company doesn't need to become huge revenue wise. $10M/quarter makes it a 25 cents/share+ net income/quarter (especially with $30M+ in tax loss carry forward to use). The scanner business in time will easily do $5M/quarter. Give it a year and a hundred software apps being written that incorporate the scanner (they already have sold 100+ SDK software packages and it will grow. It takes time for the software to be brought to market).
The key here is not the scanners. That's a guarantee imo. The key is if they can get the Somo side of their business to match what the scanners do. When the Somo 655 starts coming out early in 2nd Q, will it be able to FINALLY capture the former Hp iPaq market???
If it does, the only patience is needed. This stock will get a nice run from the low float and the "sexiness" of their products. Apple certified scanners increasing in sales sequentially makes for sexy articles on message boards and Seeking Alpha articles. It will draw in more and more speculators. That's all well and good, but solid results will draw in institutions. That's the key to double digit stock price.
+25%. Nice move up in price today. Starting to reflect the potential that is here.
SCKT... if you feel that the iPad is going to be used heavily by businesses/service companies for operations that involve heavy scanning (ex. inventory for pharmaceutical, retail, warehouse), then Socket right now has the top scanners for it than any other competitor. That's what today's announcement on the 1D scanner means. (Apple Certified is an extra layer of communication between the devices and there are only a couple other barcode scanners that do it).
SCKT...Manny T... New hiring: Sr Sales Mgr for Somo Division
http://jobview.monster.com/Sr-Channel-Sales-Manager-Job-Newark-CA-US-107315047.aspx
Here's a response to another poster from the CFO (who is really good about responding to questions):
"I'd characterize the hire as preparing for growth. The new SoMo 655 opens up opportunities with the broader HP iPAQ community that we plan to address."
The former HP iPaq market was $90M+ when HP shut if down last year. They have to go somewhere and smartphones & tablets don't necessarily work for businesses that use a dedicated PDA. If you research it, Socket has the lowest price option (even after the 650 is canceled and the 655 continues) with a layout the same as the iPaq. I thought they would go after the Somo 650 model, but from discussions with the company, customers are holding out for the better upgraded model which will be available next month (in beta now for customer testing).
If Socket can get the growth of the scanner division AND the Somo division too, it will be a killer one-two punch for a $11M marketcap company.
SCKT...stock_peeker: Very true. Expect if you are doing a lot of scanning then the difference is like trying to use the scanner at the self check out counter at the grocery store vs a designated barcode scanner. The speed makes it worthwhile. Socket has a YouTube video out comparing an app scanner on the iPhone vs a handheld unit. They even say for 3-4 items the app is a better choice. But when you start getting into numbers while doing inventory (ex. librarian taking 50 books out of the "return bin" and checking them in) it's a different ballgame.
Handheld barcode scanners are a $1.3B/year business. There is a recent article that states the use of tablets by businesses and gov services is increasing at a rate faster than they adopted the internet when it first came out. Socket has a 1D (just being introduced) and 2D Apple Certified scanner (it means they are certified to allow communication back/forth between the units. It's a special designation and comes with a Software Developers Code approved by Apple). Intermec and Motorola don't have that. Right now they are early adopters for the smartphone/tablet use by businesses (especially when it comes to inventory---of pharmaceutical, retail, warehouse).
The scanner side of Socket will grow nicely. Here is a response I received from Dave Dunlap, CFO, after 4th Q results when I contacted him about the 100+ SDK's sold already: "We sell a single SDK that covers Apple, Google, Blackberry and Windows. Thus we can’t tell just from the sales numbers the developer’s target operating system. (note: from me: this SDK costs $1300 and allows customization with the developers software. The developer though gets $5 back for every new scanner registered). However, as we also offer 10 hours of support, we can usually make that determination when the developer calls. We are actively interacting with about 35 developers today and we expect that number to grow as developers get to the point where they are integrating our barcode scanning calls into their applications. About 60% of those we interact with are working on Apple applications and another 30% on Android applications. What we don’t yet know is how to extrapolate to the 65 or so for which we haven’t yet established contact".
A year from now Socket will easily have 80-100+ partners using their scanners. Some of them will be big (ex. Lightspeed for iPad only uses the Socket 7xi scanner. They have 120+ worldwide retail resellers selling their Point of Sale system). The nice thing is that all of the sales by partners don't cost Socket any money---they just sell them the scanners and the partners do all the work.
The scanner side of the business is a guaranteed grower. If they could get the Somo PDA side of their business to grow equally well than we are looking at a multi-bagger here. I still have reservations on this side of the business until I see more sales to former HP iPaq customers and see how their new Somo 655 unit is accepted.
SCKT...WA DC libraries/iPad/Socket scanners
This is just another example of the world converting over to the iPad in business/gov/public services. Socket's scanner is a STRONG choice to use as a barcode scanner:
http://www.thedigitalshift.com/2012/03/information-technology/d-c-library-staff-tests-ipad-services-app/
SCKT...WA DC libraries/iPad/Socket scanners
This is just another example of the world converting over to the iPad in business/gov/public services. Socket's scanner is a STRONG choice to use as a barcode scanner:
http://www.thedigitalshift.com/2012/03/information-technology/d-c-library-staff-tests-ipad-services-app/
SCKT...another partnership with scanners and iPad
http://finance.yahoo.com/news/protomed-socket-mobile-partner-long-113000824.html
The CFO said there are in discussion with 35 more partners like this (and another 60+ that haven't contacted the company yet but have bought their $1300 SDK software). The new lower cost 7ci scanner will only help them more in developing partnerships like this. It's why their scanner revenue should continue to grow sequentially going forward for a long time.