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Doma...you should go back and read his latest post....his true colors are showing.
Sincerely,
Jas
A few random thoughts regarding the recent CC...
The first time I listened to the CC...I was very disappointed. Not only had the total revenue missed my low target...but the quarter of breakeven seemed no longer to be fixed in stone. After dinner, I took some time and I read all the posts from shareholders who were upset....and trust me...I understood where they were comming from. Heck....I still had steam venting from under my collar. I decided to take another listen to the CC....but this time from the perspective of a new investor... a new institutional investor. I asked myself the following question....What would such an investor be looking for?
I came up with a few points in my mind....and with this new mindset....I listened once again to the CC....Which BTW...I highly suggest that everyone do when they get a chance.
1) Lic. Revenues grew from 600K units shipped during Q2 to somewhere around 1 million units shipped in Q3. According to SKS this figure should grow and accelerate in Q4. So, if I was a new institutional investor....this is something that I would like to see....an increasing market in which Wave could not only receive Lic. revenues from...but also in which they could sell their upgraded software into.
2) During Q2....Wave had ID ~200,000 seats that were hot leads. That number has now grown to somewhere between 400-500K.
3) Q3 had almost nothing in regards to Enterprise upgrades. Little less than half way through Q4, Wave has ALREADY closed Enterprise upgrades to the tune of a couple HUNDRED THOUSAND dollars. In other words....the pipeline is now beginning to FLOW. SKS anticipates the number of software upgrades to increase to tens of thousands by Q1/07. To put it in other words....every 5000 seats nets the company ~250,000 dollars in revenues. He said that there are half a dozen potential clients out there who represent potential MILLION DOLLAR upgrade accounts.....So, if I was a new institutional investor....this is something that I would like to see....an increasing pipeline size that is BEGINNING to flow.
4) FDE drives....There has been a great deal of discussion about FDE drives vs bitlocker. From my perspective, the single biggest advantage of the FDE is that the pcs performance is not going to be negatively impacted. Vistas bitlocker will effect the performance of the machine. (Note to the techies...please correct me if my assumption on this point is incorrect.) SKS stated that they should sign somesort of agreement with Seagate sometime in Q4/06. This is very significant...not just from the point of additional revenues...but perhaps more importantly from the perspective of making Wave the default authority in the Trusted Computing space. Let me take a second to explain this point. SKS mentioned on several occasions that he has not seen any competition talking to the Enterprise community. Surely, there will eventually be competition....but look at what they will face. Not only will they have to develop relationships with the various OEMs that are shipping the TPM platform....but they will then ALSO have to develop relationships with OEMs that are shipping peripherals....in this case...the FDE drives. If I was a new institutional investor...this is what I would like to see....Wave weaving itself into the ENTIRE fabric of the Trusted Computing space...In other words....to see a company planting its flag on as much real estate as possible BEFORE the competition wakes up.
5)Vista....I'm still confused as to the potential implications regarding SKSs statement that Authentication was being supplied to Vista by Wave. Does this suggest some sort of announcement at the time of Vistas launch? Any revenue implications?
6) Consumer growth would take off in 2008
Anyhow...these are a few points that I noted the second time I listened to the CC....FWIW
Sincerely,
Jas
Whitewash...re Authentication support for Vista...I agree 100%....That comment stuck in my mind the second I heard it. Question....What are the financial ramifications of such support? Is there a financial relationship involved with this support?? I have no idea...but the statement caught my attention.
Sincerely,
Jas
Warbil...SKS was talking about a system wide Lic. agreement with the various depts of the DOD....All total...it could be as many as 4 million seats.
Sincerely,
Jas
10s of thousands of seats closed in Q1....If this is 40K seats...that brings in ~2 million dollars in upgrades.
Sincerely,
Jas
"Seagate deal by year end!"
Sincerely,
Jas
Go...re revenue numbers....I can't really argue with your calculations except to say the following:
1) Dell...I know that 80 % of Dells revenues come from enterprise customers. I'm not sure we can say that 80% of the units shipped go to enterprise customers. I assume that Dell makes more dollars per enterprise customer than they do per a retail client. Therefore, the units shipped to their enterprise clients could be fewer than the 80% of total units.
2) A large unknown is the breakdown of the 9.8 million units that Dell shipped in Q3. Lattitudes/ optiplex/ vs their machines for their retail clients. Although your 45% figure seems resonable...I have no data to argue for or against that figure.
3) Upgrade sales....This is the real wild card....You would know more about sale cycles than I do obviously....I've given the cycle 6-12 months....but I don't have any hard data to substantiate my position...other than it always seems to take longer for developments to take place than we would like.
4) Pilots...I would assume that we would show some revenues based on the number of pilots...it'll be interesting to see what SKS has to say about these ongoing pilots.
5) COLOR COLOR COLOR COLOR COLOR COLOR....have I mentioned that it will be important for SKS to provide us with some color regarding upcoming quarters??? I think this will have a greater impact on our share price tomorrow than anything else.
Sincerely,
Jas
Good morning Go....re swamped...I know what you mean I've taken a rare day off today to take care of somethings around the house...and OFCOURSE to have an oppotunity to listen to todays CC . It'll be interesting to hear what SKS has to say about the DOD/Seagate/NTT/HP???/Dell upgrades/etc....
Sincerely,
Jas
Good morning Upside...re revenues... Doma and Go maybe right on their projections.....I just don't have a reliable way of determining the numbers yet. I know that Dell shipped 9.8 million units during the 3rd quarter (world wide sales) I know that Dells revenues are roughly 80% enterprise and 20 % retail. What I don't know is how to break those numbers down to number of units. Of the 9.8 million units that Dell shipped out...lets say that 6 million of them went to their enterprise customers.....what % of those machines had a tpm in them?? I think in Q4 and upcoming quarters...the percentage will increase...but I'm not sure what the current % is...and until we do...making revenue projections at this time is a difficult proposition...IMHO. Obviously, one also has to throw in revenues from the TPM companies/gateway/Intel/any pilots/potential upgrades.....you get the picture.
Sincerely,
Jas
good morning Go...How are things? I'm hoping you're right about the numbers....but I've got a feeling they're going to be lower....I've said 1.1-1.3. Personally, I would be very happy with 1.5. Having said this....I think a more important point will be whether or not SKS is able to provide any color on future guidence. How are the negotiations with the DOD progressing? How many pilots are currently underway? Have they been able to close any enterprise deals so far? What do they think will be the impact of the Seagate drives to our bottom line? I hope he provides us with a general statement as to how the Seagate drives maintain a CHAIN OF COMMUNICATION with the TPM in the pc? How is NTT data progressing in Asia regarding selling our upgrades? Of all the potential developments...which ones does he think will have the greatest impact on our bottom line? Obviously, he may not be able to answer all of these questions....but he should be able to answer some of them.
Sincerely,
Jas
CM...re Credant...since a lot of us probably have never heard of these people....could you provide a thumbsnail sketch on the company from your experiences.
Sincerely,
Jas
Taxi....nice find....Is this the first piece of evidence to authenticate the claim made by SKS that Wave has been placed in charge of security for Dell? SKS had suggested,in a prior CC, that in order for other security companies to work with DELL...they had to go through Wave FIRST. According to SKS...this was the message the OEM was sending other companies who were interested in working together with Dell on security related products.
Sincerely,
Jas
Hazardous....Thanks for sharing your DD! If it's not too much trouble, can you say in general terms what type of work you are involved in? Were other attendees familiar with TPMs? What was the general feeling about the capabilities of he upcoming FDE drives from Seagate?
Why do you think the Dell site was picked vs the other OEMs?
Sincerely,
Jas
Waverider...re possible 8k....Wave should put it to music......"Another one BITES the dust...."
Sincerely,
Jas
Helpful...re Silicon Trust....granted that they have been part of that alliance for years....but for some reason it doesn't make sense to have your only major threat demonstrating a superior product at your booth....then again...it could be as simple as Wave is part of this alliance and as such has the right to be in that booth. If that is the case...then we are obviously reading too much into this pr regarding Infineon.
Sincerely,
Jas
Vacationhouse...Interesting PR....
1) Wave will be in Infineon's booth demonstrating the ETS 2.3 software in conjunction with a TPM.....VERY INTERESTING TO SAY THE LEAST! Is the last TPM manufacturer ready to fall?
2) Seagate FDE drive.....Waves Wmbassy Trusted Drive Manager, a plug-in component to the Embassy Trust Suite, designed to work in conjunctionwith Seagate's Drive Trust to offer comprehensive security functions.
1)Drive activation
2) Drive security policy setup
3) Automated key and passwoord management
4) Strong access cokntrol
5) Instant data destruction for repurposing of drive disposal.
Now compare these capabilities with those mentioned in last weeks articles regarding Seagates new drive....a few things that make you go HUMMMMMM....
Sincerely,
Jas
Wavxmaster....Just to throw some more fuel onto your fire, don't forget that some Disk drive manufacturers are making an all out push to have all of their Disk Drives FDEs. This will accelerate Wave's potential revenue stream....something like "taking a second bite of the apple" )))
2007 will be a VERY INTERESTING year...to say the least!
Sincerely,
Jas
Seagate FDE availability...1/07
According to this article...
http://techreport.com/ja.zz?comments=11128
The OEMs should have them by 12/06...and available as an option by 1/07
Sorry if posted before...
Sincerely,
Jas
Good afternoon Fullmoon,
The short answer to your question is that I do not feel that the infrastructure is in place yet. Having followed Wave for over ten years now...I've come to the conclusion that the industry moves much slower than we as individuals think it should. Are there things or events out there on the horizon that may change the speed of adoption....yes! If a major retailer or financial institution were to come out and say that future online transactions must be done via functions provided for by TPMs....that would change the equation in an instant. (Retailers such as E-bay/Amazon/ or any of the banks that do online banking.)
AWK has written a more indepth response to your question on his board...fwiw
Sincerely,
Jas
Scorpio....We don't discount what you and Barge are saying....what some of us are saying is that it will take TIME for that sector (CONSUMER) to add to Waves bottom line. Personally...I think we are talking 2008-2009 timeframe. In the meantime....the ENTERPRISE/GOVERNMENT arena will provide the FIRST significant impact to Wave's bottom line.
Sincerely,
Jas
Q3 computer sales....
For those of us who would appreciate some data points regarding calculating potential revenue numbers....
http://www.notebookreview.com/default.asp?newsID=3291
Dell shipped ~9.8 million units in Q3/06...5.3 million of which were sold in the US
Gateway shipped little over one million units in the US.
FWIW
Sincerely,
Jas
Seagates FDE...
Here is an excerpt from the article..."Key to the success of Seagates archtecture will be the integrity of the CHAIN OF COMMUNICATION between the TPM module on the PC-upon whose existence the Drive Trust will depend-and the TPM on the Hard drive."
Here is a quote from Wave..."The emergence of additional trusted PC components, such as Seagates Momentus 5400 FDE drive....represent additional oppportunities for Wave's products to support and INTEGRATE these devices with the TPM ELEMENTS IN THE PC."
From todays Seagate article that Vacationhouse posted this afternoon...."This is an interesting announcement for the market because it is designed to make full disk encryption easier, especially for the enterprise," said Kolodgy (IDC analyst)"Seagate is leveraging the TPM for key management and allows enterprises to maintain secure storage of the keys."
Here is another quote from Wave..."The trusted Drive Manager, which provides an easy way to setup and configure the Momentus 5400 FDE drive and automated protection and management of passwords and encryption keys."
A few things that make you go HUMMMMM
Sincerely,
Jas
2/06 "Waves Trusted Drive Manager to give organization an easy way to set up and configure the Momentus 5400 FDE drive and automate protection and management of passwords and encryption keys."
"Waves software enables organizations to implement a single, integrated infrastructure for managing their trusted devices."
FWIW
Sincerely,
Jas
re Seagate.."Key to the success of Seagates architecture will be the integrity of the CHAIN OF COMMUNICATION between the TPM module on the PC-upon whose existence Drive Trust will depend-and the TPM on the hard drive (HDD). With the hard disk drive itself being one of the most closed system in a computer assembly, it becomes relatively easier to secure the CHAIN OF COMMUNICATION between the CPU and HDD using hardware based authentication."
Sincerely,
Jas
3.10...new high for the year!
Sincerely,
Jas
Barge...re misrepresentation of the debate.....B*LL S*IT! Do you truly believe that those of us who have been saying that the first wave of TPM deployment will take place in the enterprise/govt sector do NOT believe that the consumer space will be fought over aggressively? The question that needs to be answered is which area is MOST likely to generate revenues for Wave over the next 12 months. There are some of us who believe that area is the Government/enterprise arena. After Wave becomes the dominant player in this arena....I believe that she will set her sights on the consumer market...To suggest that we do not understand the POTENTIAL of the consumer market is pompus and absurd.
Sincerely,
Jas
Micro...re consumers and TPMs...I'm somwhat confused by your post. All that has been said is that the first batch of TPMs are going towards the enterprise/govt. sector. The consumer market will begin to be engaged in 2007.
Sincerely,
Jas
Cosign....re SUN....If you go back to 1998...I believe that you will find Suns name in the Embassy PR....
Sincerely,
Jas
Julesg....then you will have to activate your TPM and utilize the software that you said that you would NOT want to use....I would re-consider your decision if you want to use your smartcard reader....FWIW
Sincerely,
Jas
Julesg...Just our of curiosity...did you purchase a notebook from Dell or gateway? Does it have a smartcard reader or biometrics on the system?? Do you plan on using those items?? If the answer is YES...then guess what? YOU'LL BE USING WAVES SOFTWARE....FWIW
Sincerely,
Jas
DD....The answer to your question is....NO
Sincerely,
Jas
Micro...re who is buying the 50 million TPMs this year.....Micro...I know that you are aware of this...but ~80% of Dells revenues come from their sales to Enterprise/Government sectors. Most of their sales are therefore not to the consumer market. Take a look at which of their products contain a tpm....its their workstations/latitudes/optiplex desktops......notice that their "consumer" offerings do not contain a tpm...at this time. Obviously....a consumer can purchase any product he/she is willing to pay for...but it's not currently being marketed to them.
Sincerely,
Jas
Wavxmaster...re 3rd QTR numbers.....I agree....my personal view is a range between 1.1-1.3 million. I know that some are expecting a great deal more....I think we are at least one qtr away from some of those expectations...imho
Sincerely,
Jas
Good evening Go Kite,
I agree that the future looks very bright IF they can execute their business plan. Q3 just finished and I expect the company to come in between 1.1 -1.3 million for the quarter. Q4 and Q1 should be significantly higher for two primary reasons:
1) Continued growth in the TPM deployment numbers
2) Closing Enterprise deals...You have more experience in this arena than I obviously do...but I would guess that a conservative estimate would be ~6 months(time to close a deal). That should put us into Q4/Q1.
Sincerely,
Jas
Guv...when does Wave simply 'move" with the markets? lol Personally, I think it's simply the traders hoping on board looking to sell in the 1.90s/low 2s (IMHO) Then again...SKS may say something interesting in tomorrows webcast
Sincerely,
Jas
Re institution holdings....although the numbers for Leg Mason are not accurate (multiple of 3)....the numbers for Vanguard are roughly 3 times the current numbers on Nasdaq.com. I wonder if we are looking at the some holdings...one in post-split numbers while the other data points are in the pre-split mode.??? Having said this....if one looks at the Nasdaq.com page...it clearly states that Vanguard holdings had NO % change in their holdings as of the period ending 6/30/06.....however...the page on Quote.com states that Vanguard added some 600K shares in the period ending 6/30/06.....So......I'm not sure what we are dealing with regarding these two reporting sites.
Sincerely,
Jas
Donald Duck...You beat me to the article regarding the creation of ClearBridge Advisors.(NICE FIND BTW) What is really interesting is that we had a recent find that Legg Mason had purchased some 400K+ shares on the open market during the second quarter. What I'm not sure is whether they have lumped those 400K+ shares into this total of 1.4 million or is in addition to?? Either way...it appears that although the retail hoders maybe getting nervous...the insttutions are beginning to step up to the plate....It would not surprise me that by the end of the year...the institutions may hold north of 20-30 % of the outstanding shares...IMHO
Sincerely,
Jas
Gokite....GREAT post!
Thanks,
Jas
Guvna...I think you are not getting the gist of my posts. I'm not attacking you. All that I'm saying is that we all should be feeling better about our investment today than a few days ago. Before...we did not have any data points to substantiate our belief that the company has started to engage the hockey stick ....today....we have that evidence.
Sincerely,
Jas
Guvna...I think you are not getting the gist of my posts. I'm not attacking you. All that I'm saying is that we all should be feeling better about our investment today than a few days ago. Before...we did not have any data points to substantiate our belief that the company has started to engage the hockey stick ....today....we have that evidence.
Sincerely,
Jas