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I can't hang progress on a single GAAP rev number ...
If Dell stayed the same ($1.5m) and total was e.g. 4.3, that would be bad.
If Dell went to zero and total was e.g. 4.3, that would be good.
It would still show QtoQ and QtoyoQ decline, but it would mean that WYY, Samsung, SanDisk, MU came in at $1.5 (rather sudden and clear sign of improvement/growth in new OEMs) or a whole gaggle of SMBs added up to a doubling of non-Dell revs (a clear sign of broad demand).
Either of those would show clear signs of progress and rapid growth in their respective segments, all in the face of a declining rev number.
last Q was particularly bad as Dell decline was 0.5m AND non-dell suffered as well with no observable new-OEM business. The only thing that held its own was Safend. Billings were down too.
somehow there is still over 6m in defrevs on the books, I don't get that. Given that SMBs are realized immediately and presumably a 1/4 of defrev is realized per Q, what keeps backfilling defrev? there hasn't been a large enterprise in a long time (the contributors to the defrev liabilities column). It seems the only explanation is there are customers buying 5000 seats of an inexpensive product (total sale under 8-k, total seats over large customer threshold for accounting).
Given that I expect Dell to continue to slide a good deal, I can't see how revs will come in above last Q, so on the over under I'm going with under 4.4 for revs.
"not sure why investors should focus their attention on this company"
with a whopping 80k shares in vol., it seems there is some broad agreement on that.
tkc, the thing for me is that he seemed to really downplay Samsung at the Q2 CC:
Q about Samsung :
I think the second part of your question was Samsung TPM, you probably noticed, as many did, that we signed an agreement with them earlier this year to ship our software. And when will they be a significant contributor? And frankly, I just can't say. My answer is not soon enough. Okay?
I don't have specific timing that I can give you on that. We're actively working to increase our relationship with Samsung and seeing what we can do to drive those revenues higher and be a good partner for them. And that's pretty much my answer for you.
This doesn't strike me as anything resembling even the modest $0.5m pushback against eroding Dell you suggested as a possibility (that amount would clear the 10% customer reporting threshold which obviously is a significant contributor, at least to the SEC).
That leaves Sandisk. I'm still thinking revs are tied to coupon use, not just coupon shipment, and expect it to be paltry as well. Solms is stoked about micron, that seems to be the flash play, but that to is not today.
I really really is all on VSC and SEd managment for the plan to work as scheduled.
tkc, so I went and listened to the thing,
one can go where they want with statements, but in describing the company and the business he referred to Wave as having had some large customers (named 'em) and an oem (named dell), went on to say they had lost dell, "but the good news is they had made up for the loss of the oem by bringing in new oems" plural and believes that will provide more stability/less dependency going forward.
I did not interpret that as a 'the Dell revenue has been replaced' statement. . I was (as a listener) in customer/partnership description mode, not cash-flow mode. IMO, expect to be disappointed if expecting $3-4m in OEM revs that one might argue constitutes replacement based on that mention, BICBW (nah).
OEM revs, I listened to the C-H QA session and I got the "I don't think so" re need another refi, but I did not get the OEM make-up revs from that, although the Handicapper General may well have leveled me with a 21 gun salute at the moment, not that I really require such handicapping.
Fair enough. You are again making the argument, in so many words, that billings and revenue llast Q was $0.00 and that for Q3 it too will be $0.00 ...
"If he had even a small deal with revenue in his bag, he'd pull it out and show us"
I expect that there will be milions of dollars of billings and revenue in Q3 as there was in Q2.
I can't reconcile your statement quoted above with what was filed for Q2 and what I am confident will be filed for Q3.
I've asked you this before, if these millions of dollars in reported revenues and billings are not sales, what are they?
tkc, molehill/mountain
as I've made clear I am in the molehill camp, largely for the reasons you stated. Some of the sentiment might be found in language, blue refers to a failure to "close" the deal. Even if a definitive agreement were finalized, I would not be inclined to use the words "close" the deal. That sounds like a sale.
This is more of an agreement to move to another level of NDAs in order to craft a product to sell to somebody else (or actually give the product away??) for a cut of of the delta on a portion of the transactions for which if all goes well things might begin to trickle in 2015.
I am unwilling to do binary filtering. There seems to be a notion that all things are the same, that past management was nothing but potty mouth, and thus new management must prove better. Fine. Fair enough. But telling me you are going to sell a billion dollars of software on Oct 5th is different than telling me you are going to use cyan shadowing on your next conference handouts. Some here seem to consider the two the saem, equally worthy of red-flag status.
The former is very material, it involves, money, it is critical and current. The latter, while material, has no revenue attached, and importantly, it has no time sensitive component (in a general sense). It doesn't mean squat if they ink a "definitive agreement" last March or next November. The two outcomes add up to a grand total (difference) of zero dollars and zero cents. Moreover, developmentally, the difference is similarly nil as far as I can see.
Getting the knickers in a bunch of something that measures zero difference from multiple perspectives is LOOKING for something to get them in a bunch over. In essence the argument is that Solms should caution himself obsessively against errors that mean nothing because some want to see them for more than they are.
Of the investors at the C-H thingy I bet a total of zero think there was any failed deadline, redfalg, failure to close etc etc. as investors they likely focus on what matters, and taking something that doesn't matter and saying it does matter because SKS was a fool seems silly. "Doesn't matter" is an overstatement, but much more accurate in a value sense than pretending that something "failed to close" in some sort of meaningful way.
Unless of course he is lying, if Solms is lying about continuing progress and the lack of a DA is a redfalg for that lie, then it does matter. I don't think he is lying on continued progress on the EMV thingy.
I'm somewhat familiar with "definitive agreements" trailing development work, although it varies how much folks are willing to run with initial LOIs and NDAs. No doubt at some point investment stops absent something firmer than an LOI and a first round generic NDA.
tkc, uhh, w-what?
"Didn't Solms say that he has filled the revenue drain from Dell's exit w/ that from other OEMs?"
I definitely missed that ... not that i know what it means ... Dell spent some time in the 5m/Q zone as memory serves, then 4, then 3, then 2.
Is this a projection that the other OEMs will fill, or a reflection that the OEMs have filled.
Seriously, booking OEMs, in theory are:
Dell
Samsung
Sandisk ....
that's it, right?
Still, that all said, ... fill to what level? The peak?, the rengotiatede few Qs RA? 2012 averaged $3.9/Q, 2013 ave $2.8/Q. When Solms got hired it was around $3m.
Certainly news to me in any event , source?
that last bit reflects my lack of urgency over the next couple days, and my confusion on Blue's point there. An 8kable between now and the report in early Nov largely serves the same purpose regardless of whether it happens in 2 days or 2 weeks. The methods of booking large orders largely forbid a significant GAAP effect Q3 between the two outcomes.
fair enough, we seems to largely agree on what is, differ some on what it means.
I haven't paid enough attention to broad opinion recently to guessify what folks are hoping for. I did last Q and somewhat deliberately went on a bit of a curb your enthusiasm meme for a spell.
As far as the hoping thingy, for me, much was quashed in Q2 remarks, little enthusiasm was shown for near term Samsung and I had hoped for some mindless 99% margin dime a box OEM stuff to backfill the Dell void, and Solms indicated (IMO) that ain't to be the case near term. (a contrasting thingy vs SKS who would have blathered all sorts of false hyperbole - Solms indicated (to me) disappointment or frustration and an indication that work was to be done to get that happening meaningfully for Wave.
other hopes are the well established ones (the high seat value things) VSC and SED management. I have penciled in them likely invoking 8-ks at around 350k or so, give or take. There have been none, given the stated sales targeting (lrg) it would seem Q3 will book as more or less sideways.
If the above represents disappointment then I would put it at greater than 50/50. Maybe some pilot scale thingys w/e.g. VSC, ca. 5k seats, that would move the needle on billings but not likely get 8ked, at this point that is the most I hope for for Q3, but I have that closer to 25/75 or worse. SKS would have blurted 5k pilots in some way by now no matter what, if such a thing has occurred and it shows up in the report then these folks definitely are trying to hold the line on hype and guidance.
The saving grace of course is an 8kable before the Q report, it wouldn't be in the numbers, but it would speak for itself. Just like like Q when I indicated I thought a lack of that could be (and was) punishing same holds for Q3.
Blue I get it, Q3/Q4 to you means a portion of it must occur in Q3 and the absence of it is a "blow" to credibility which when coupled to the lack of a "anticipated definitive agreement" is the two strikes to which you refer. Correct?
If so, fair enough. I don't see it the same way.
O.K., i get it,
I just don't see the same if A then B, if B then C then if A then C
AND, if not C then not A.
I do note that Bell-ID is on the Wave website as an approved partner, I don't know what that means, and Solms did refer to a timeline for Wave+BellID products (2015) although I only can guess what that means. Given the PR, I assumed their would likely be a PR of an agreement, but I would place my assumption below a commitment for a PR in a certain timeframe. I don't do PRs, I don't know whether it is/would be natural or sensible to do one for an agreement in this case or not, whether it is a plus or a minus to do such in Wave's current position, or whether an agreement has been finalized. If the agreement is/would be material, materially binding, then one must assume it hasn't finalized.
I am not at all inclined to use a Bell-ID agreement as an indicator for VSC sales competence, demand or likelihood.
As before Wave could sign 0, 1, 10, or a million Bell_ID DAs in August and it would do nothing to inform me or influence my confidence or lack re VSC sales.
Finally, re: Bell-ID agreement, as I've stated earlier, I consider it to be as far away from Wave's normal course of business as anything they have done, and hence expect it to be slower and more complex than they anticipate (hence I didn't like the word "August".
The comparison to me is akin to "if they can't knit, how can you expect them to scramble eggs" answer: knitting is knitting, scrambling eggs is not knitting.
and as far as "causing"
the tape:
On July 30 WAVX closed at 1.37
at the open on Jult 31 wave released the Bell_ID PR, and closed that day up 2 cents to 1.39 on modest/light volume
the next day they gave up the 2 cents plus a penny to close at 1.35 (volume and price movement all consistent with my interpretation of the SP consequence of the future project "Bell-ID") It seemed to me then (and now) and sensibly I might add the market, for the most part, could not give a flying monkey about Bell in the near term.
On Aug 7th Wave closed at 1.31 on higher volume (now off 7 cents from the Bell_PR of a week ago). The next day they close at 1.17 (the Q2 report and no new sales). It was not reported on Aug 7th and Wave failed to reach a definitive agreement with Bell-ID, what happened is they reported the previous quarters sales. The future project Bell thingy having all the consequence of, well, nothing?
the price recovered a dime over the next week and drifted sideways with some variation for a month. In the last two weeks Wave has stair cased itself down on light volume to the Aug8 level.
In the face of the tape, is it really your argument that Bell_ID is "causing" the recent SP behavior of WAVX? or am I just misunderstanding what you are saying?
we are all entitled to our opinions, mine is that had Wave announced that they had a definitive agreement to do something with Bell in the future as opposed to and LOI to do something with Bell in the future that the SP would be right where it is today, BICBW.
I'm thinking it is an expectation of sales, indeed a requirement for sales (near term, now) that is driving the SP (and the company's prospects in general).
Again, the question is whether Solms is correct re:VSC.
Wave and Bell_ID could announce a definitive agreement in Aug, or ten definitive agreements, or several million definitive agreements, and the fact remains, none of Bell does or has ever had anything to do with the fundamental aspects of the "turnaround".
As stated before, I was
67% incorrect in guessing when/(if/when) traction of that nature would be observed. I was more like 100% correct regarding what the SP would look like if the 33% is what was realized.
Blue, I appreciate your point on Bell, except that it is not and has never been part of what I was posting about, but nevertheless the company did state they anticipated a definitive agreement in August and they have not stated that they reached a definitive agreement. As I've stated before I have two thoughts on the Bell "deadline" 1) I thought the use of the word "August" was a mistake and 2) I consider the topic largely one of inconsequential minutia.
I have no idea what two day time limit you are referring to, I see others refer to it as well, but I am not familiar with what the expectation is for anything by Tuesday or what the source for that expectation is. I pay pretty close attention, but apparently whatever it is you are referring to has slipped under my radar.
In short, echoing wd, (or to make a short story long)
the process seems good. The process appears methodical. The construct has completeness to it, that is it has defined objectives, a defined strategy to meat those objectives, parts are evaluated through the lens of their contribution to those objectives.
The portfolio and market were examined, adjustments were made to mesh the product and the market, a time frame was established and communicated, funding was acquired, funding levels matched stated timelines. Adjustments were given time lines, events occurred in a timely fashion confirming the adjustments.
Concurrently, culture was addressed. House was cleaned and reported as such. Compensation amounts and methods were changed and officially reported. The seniors put 20% of their annual salary in cash into the market. The CEO owns more shares than I do, fancy that.
Obviously, it all comes rather simply down to a single question: Is Solms correct? Is he correct that the market demand for VSC is real and now, is he correct that Wave's buffed up VSC meats that demand, is he correct that the volume of that market will demonstrate traction within the time afforded by the placement ...
One can flop around all they want about how he must be wrong because their own models indicate they should see this that or the other thing by now, but such speculation is certainly outside the plan as laid out. Now, is the clock ticking ... oh yes, but it is not over-time, it is till part of the regularly scheduled game, the whistle for half-time blows on Tuesday.
He is publicly sticking with the schedule. Only time will tell.
While it has nothing to do with execution per se,
he not only took the job for 200k,
and eliminated non-performance bonuses,
but also put 19% of his after-tax annual salary on the line at $1.41 ...
clearly different behavior than the visionary two universes removed.
These things do not mean he is correct in his projections or ability to execute, but there is real skin in the game.
I'm more in the mode of whether to live in the Bronx or Queens while on the deck of the Titanic. It may very well be important, but there is that whole being alive thingy that needs tending to. Somebody could tell me that my LOI re:Queens has not progressed to a definitive agreement, or that it has, and either way my response will be identical ... did you happen to come across a life boat? ... hence inconsequential minutia.
I agree 2015 won't do it and never ever thought Bell_ID was part of pre-2015, nor has the company IMO. I certainly agree, and said so at the time, that the inclusion of the word "August" in the LOI PR was IMO a bad idea. The words should have been "near future" and I suspect the complexities of this deal exceeded their experience set. Were they an insurance/banking company e.g. I would have felt they were better staffed to be able to sign a "definitive agreement" in the time frame they afforded themselves by use of the word "August". I am unaware of Wave or anybody they have recently bragged of hiring with anything that I would humbly consider to be the experience set to close such an agreement (something I remarked on a while ago). Obviously (IMO) they pushed for the Bell_ID PR because Bell-ID EMV was something they wanted to talk about. One can measure the "August" word as a red-flaggable event or not. Given that even a material event definitive agreement would not have been material to me (I can't see any path towards near term revenue which is what counts for me), the inclusion of the word "August" or the failure to PR progression of the Bell-ID thingy is not red-flaggable to me (hence WTFKOC). Again, as you said 2015 won't do it, and as on my radar Bell_ID is not and has never been a 2014 thingy, it drifts towards inconsequential minutia. Events required in 2014 dwarf, eclipse, preempt, supersede (whatever word one wants) to the point that a DA in August is, to me, inconsequential minutia. The stated goal of Wave EMV is to get a piece of a piece of a subset of transactions for which I am not aware of their currently being the necessary infrastructure. 2015 might be ambitious.
On a separate note I suspect Wave is painted pretty thin right now -
Bell-ID ("anticipated" thingy)(both engineering and contracts staff),
MU ("products in development" stuff) (both engineering and contracts staff),
VSC (indicated launch customer(s)(both engineering and sales staff)
Safend (sales staff and presumably some engineering support staff)
SED (sales staff and presumably some engineering support staff)
SanDisk (presumably engineering support staff)
WYY (presumably engineering support staff)
Samsung (wtfk)
While it seems clear to me that the last admin could not walk and chew gum at the same time (with results more consistent with eating doughnuts and hitting the 'loo at the same time), the current staff, it would seem, has a pretty full plate ... but in reality FWIW, with both stated and inferred timelines, Bell-ID and MU are at the very very bottom of the necessary/sufficient list.
this is not a point I am interested in either defending or attacking management on, I was simply commenting that it appeared that cartoon was making an inference or exploring the potential for an inference.
If they are successful moving some significant VSC and/or SED management sales in the next few months, the point of announcing/inferring/whatever on a DA is largely one of inconsequential minutia.
If they are unsuccessful moving some significant VSC and/or SED management sales in the next few months, the point of announcing/inferring/whatever on a DA is largely one of inconsequential minutia.
Hence, for me, WTFKOC on whether a DA was inked between Aug1 and Aug31 2014.
player, it seems to be a simple inference, hence "seems".
One one end is LOI with anticipated DA, on the other end is "product in partnership with the EMV producer is slated for 2015", inferred is the DA
not that it isn't largely WTFKOC at this point.
zen/tkc, I babbled about it some in the link below
and my thoughts haven't really changed much, I'd probably use a bigger number I suppose.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=105142650
a point often overlooked it seems in these discussions is that eventually (that is once one establishes an adequate number of large accounts) then maintenance+some OEM bundling type stuff pays the bills.
I think my numbers are wrong in the link above on that ... $1m/Q in large orders gives ~$50k (not $200k) in maintenance per Q in subsequent years (I was awarding annual fees quarterly in the link above, it takes 4x more sales for maintenance alone to equal any given amount of up-front license going forward.
So to e.g. replace 2.5m/Q in burn w maintenance alone one requires roughly $50m in accounts.
It is noteworthy that Solms appears to not be backing down, but in the end everybody is just guessing .... me, you, Solms etc. He is sticking with his guess, I'm watching paint dry with mine.
wd, there might be room for the notion of being adequately exposed, and hence no need to buy more, belief or no belief.
But in the end show-me clearly owns the day.
I listened to the last few min of the C-H, and yes, he did reiterate the 'on track' notion.
It does speak at some level towards what he thinks he sees, the longer one waits the larger the perceived contracts must be. Unless he is brash enough to have smaller deals in the cross-hairs and is just assuming rapid follow-on. But as the candle burns it moves more and more towards a requirement that those in the cross hairs must be more substantial.
This confluence of what is known, not known, and variously presumed is really something.
I bet you could cut the tension with a knife in Lee.
FWIW,and much to my surprise,
according to the last disclosure on the matter (public verbal by Solms) Rich Lee works for Wave today, heads their cloud services effort, and the purchase of IP from Exo5 was to jump start wave's efforts in the matter. So while it may smell bad, it and he apparently have enough value to retain (in Solms' eye).
I'm not sure observing what is (trolling) is advance pooh-poohing. If calling it what it is seems like pooh-poohing it may be a function of the lenses worn. It is trolling, if something comes from it then something does, but the existence of a lawsuit in the past does not make the current state of affairs anything more or less than what it is. I am uncertain what the alternative is to observing what is. Is one to start imagining the shape and nature of allegations, postulate on who or what the defendants might be and so on in order not be careless?
What constitutes a careful not-brushed-aside consideration of trolling?
Unfortunate that all that visionaryism failed to inform on what will be.
the notion held by many, it seems, that with proper visionary leadership that Wave will still become some sort of secure execution space mediator of multi applet fun leading to uber billions is one such old notion I find perplexing.
Trustzone is built and the consortia went places other than Wave for every single solitary component. The 2012 applet swapping patent is held up as some sort of thing of value that is going to ensnare the entire Trustzone (or any space like it) into Wave dependency. That smacks of too much brandy and not enough coffee to me.
At the SHM one shareholder was concerned that they weren't hearing about "apps" and presumably app rental space, app switching fees, app licencing and so on.
Others still see a swiss army knife, the whole planet revolving around Wave dependency based on .... what? No laws forbid writing management tools to an open standard platform. How does that get all the way to de facto?
There are many however that would just like to see Wave sell some enabling products and turn a dime. Given current valuations Wave could still be plenty successful, but one must (IMO) always be cogent of their zero-moat business plan.
Blue ?? huh?
last quarter reported both revenue and new billings ... if those were not sales, what were they?
Blue, I think I covered that ...
If, however, you are reducing the granularity to simply 'is this a large sale or not' then I suppose you could make the argument you are making (which apparently is not a viewpoint but rather a marshaling of facts).
ICBW but recently the clients of
Craig-Hallum shelled out ca. $10m for shares and warrants of WAVX Class A common at a price of $1.90 and the warrants carrying the same strike ($1.90).
It may be a matter of professional courtesy that Craig-Hallum exerts pressure on recipients of such funding (Wave Systems in the case) for a presentation and perhaps more pressure when the equity has never traded publicly at the price, $1.90, since the placement and has only gone south since then.
If such is the case then the presentation may be a matter that Wave is entirely uninterested in doing, but one for which they feel somewhat compelled.
Again, ICBW, but given the status of the balance sheet at the last report and given the history you are claim "continues to track the arc of the previous CEO's sad trajectory" I would personally note that I am not familiar, BICBW, of Wave having done this type of road-show thing in the past with their most recent agent when they didn't need money ... and I don't think a sound argument can be made that they, at the moment, need money.
Consequently, this particular event, to me, lacks resemblance to Wave's history of such events. If, however, you are reducing the granularity to simply 'is this a large sale or not' then I suppose you could make the argument you are making (which apparently is not a viewpoint but rather a marshaling of facts).
In short, I find the timing of this to be unusual, note that it is with the most recent agent, and personally speculate that Craig-Hallum put them up to it. It was a comparatively large placement for a company in Wave's position, C-H could easily be just calling them to the mat.
(None of this is anything close to anything where I might have any experienced-based or otherwise informed notion of what is or is not.)
wd, I too have noted the opportunity to back-pedal, a point you raised promptly as it occurred. Given the desert and nothing but muad-dibs to consort with, I looked at it again and the context. It is pretty clear, he was not pleased presenting the Q2 results (and the general recognition that nothing major had happened to that point in Q3) and stated clearly that those things (Q2 results and first few weeks of Q3) had not derailed the plan. And the plan has been Qs3/4 to demonstrate "significant" ("" from previous comments) sales OR the plan is to effect a turnaround within the window afforded by the most recent placement. The two: Q3/4 signficant sales and turnaround within placement/cushion are not identical to each other - but pretty close. It wold be difficult to accomplish the latter without the former.
So there it is. He certainly could have added any variety of goal post moving language and declined to do so.
I believe he believes. Know it is just a matter of finding out if he is/was right. (echos of brant_point's comments a bit ago stir the air).
wd, yup
In many ways I was surprised by the "anticipate" statement because a) the rubber hitting the road is a long ways away and b) it would seem a definitive agreement would include the revenue split. This is entirely Bell-IDs business, their market, their customers, their infrastrucutre. Wave provides an enabling technology to allow a better margin on a subset of transactions - a pie that needs to be split three ways (Bell, Bank, Wave) and the discussion hinges on tenths of a mill point. Furthermore, as the product in some ways does not exist the parties are speaking towards a volume black box, and it is a model that depends entirely on volume. The negotiations it would seem to me would likely go back and forth a good deal. And, of course, it would presumably involve language to address liability in the event of failure. The notion is to recover the difference between card present and card not present as they are valued differently as a consequence of differences in observed (extant) fraud rates. What happens if the WaveEnabled transactions don't come in at the anticipated fraud rate? Who carries the bag on that? Does the reduced fraud rate need to be demonstrated before the improved mill rate is enjoyed? It strikes me as a very nitty gritty fine resolution actuarial kinda thing for which I could imagine the negotiations could easily derail when a party insets any variety of little pieces of language that could have significant downstream consequences.
Misplaced notions
1. EMV. The Bell ID thing is a far forward thing IMO. Statements of record include the LOI, a statement "anticipating" migration of the LOI to a formal agreement, and statements regarding how the revenue stream for that might take shape (transactional revenue on the difference between card-present and card not present). NONE of this implies anything resembling revenue in 2014 or even long into 2015 if in 2015 at all. The point is Wave is facing a revenue crisis, and Bell ID EMV has nothing to do with presenting a solution to that for the foreseeable future. Any statements (or missed "deadlines") regarding Bell-ID can only serve as information and perhaps SP hype. There is not a dime in this for a long time - indeed this can only have development expenses in the near term.
2. Federal FY and getting Sept sales. My understanding is that while Sep30 is the end of fed FY, that is by no means the 'spend to' date. My understanding is that federal agencies have a rolling series of cut-off dates for purchases as the FY comes to a close e.g >$10m=Aug 1, >$2m=Aug15 >$25k=Sep1 and so on.
For an 8-kable federal event it may very well be that the train has left the station. I expect that these postulated dates and cut-offs (all simply examples of the idea) vary considerably by agency. My understanding is cut-off dates are further confounded by all of the open competition, sole-sourcing, bid-window stuff ... rushing for the fy door is not as easy as just pulling a trigger.
It would seem to me that notions of hanging the hat on federal fye sales is not likely to do well.
If the Fed actually funds FY15 in a timely fashion (a rather rare event) then larger purchases at this point (mid-Sept) may be more likely to occur on the other side of the fy line and the liquidation of remaining FY14 funds is just pumped into a plethora of small ticket items that slip under cut-off thresholds (things like light bulbs, toilet paper, and pencils).
The fact is Wave's limited federal business to date has occurred in WaveQ4/FedQ1 (e.g. WEM).
3. VSC and SEDs. So while the chadder of late is regarding Bell_ID and the Feds, the plain reality (to me) is that the nearer term revenue requirements for Wave will (if/then) be met by private sector sales of VSC and or SED management. Look nowhere else. The company is discounting the product to early adopters, they have done all the hooplah their budget allows, and they are now entering a time of year where historically they have conducted the preponderance of their business.
They either get some significant early adopters (VSC) or new customers (SEDs) and the plan worked, or they don't and it didn't.
It would be somewhat amusing if Wave's
next large contract (if/when) was essentially the same as the last few ... a sizable managed SED deployment as opposed to VSCv2.
mmbg, wd - I have a different spin on Credant.
Credant historically did what Safend did, and indeed got their Protector product from Safend. Wave also licensed from Safend from which they back doored their way into some FIPS compliance.
Wave always poo-pooed old school stuff (Safend and Credant) but that stuff actually sold (Safend was almost 50% of Wave revs last Q, and the Q before that.
I agree that Wave treated the Dell deal like the finish line rather than the starting line, particularly as it followed later with GM.
Over time Credant moved towards Wave adding on some TC-like functionality, and while asleep at the wheel Wave finally, belatedly, too latedly, realized that some good old fashioned DLP would complement their offerings and help get them through some doors. It was too late for Dell. Had Wave bought SFND a few years earlier, Credant might have died at Dell (or at least if a competently managed Wave with steady quality updates and so on existed).
Dell cozying up to Credant precipitated the Safend purchase, requirements from BP sealed the deal.
The differences between Credant and Wave were always rather real, even in the Dell product line DDP-A and DDP-E. And some DDP-E was Safend.
That a $12m purchase brings in nearly half of Wave's revs against the half a billion invested in everything else speaks towards what was/is selling. Dell bought what sells. Wave thought forever that TC was any day and hence never wanted to get into the commdity market of DLP solutions. It was a mistake.
mmbg, largely agreed on Samsung
the 15 year thingy was largely a whatever, but they did state back in Feb (as I recall) that they had begun 'shipping'. The dell experience (for Dell) was largely one of a somewhat expensive bloatware gambit. I am expecting that some of these new agreements will be coupon agreements, e.g. Sandisk ships with a coupon, IF the coupon code is activated (the customer bothers to download the software) THEN Wave gets paid.
This argument speaks torwards whether the fire is hot, and that is indeed the concern, but it does seem that when selecting irons to test the temperature of the fire, Wave irons are often being selected.
VSC is different, it is competing directly to a known deployed technology and is making a direct value proposition. Hence VSC tops the list. SEDs are #2 as they have seen traction in the past, are a well covered and well-understood capability, and in some verticals the audit trail features make a compelling argument.
I completely agree with the analogy to a 15 yr futures play, well said.
The debate seems largely settled and agreed upon, the difference being one of emphasis.
Using a comment by: NW "From VSC to SEDs, TPMs, WEM, EMV, Micron and mobile TC there are an assortment of hot irons in the fire."
The debate here seems to be more of 'From VSC to SEDs, TPMs, WEM, EMV, Micron and mobile TC there are an assortment irons in the fire, what remains to be determined is if the fire is hot.'
If the fire is indeed hot and the recently burnished irons are suitable for the task and if the recently replaced iron-wielders are up to the task then, according to plan, it should be visibly manifest before the end of the year.
brant_point pretty much nailed the point, if I can paraphrase 'did Bill fall for it too?'
That certainly has been on ongoing question in my mind, and short of obvious sales the only way I can see to try to determine this is to look at others - those that are not Bill, and are not Wavoids.
To this end one can only look at partnerships and agreements, however weak a proxy they may be. What would be nice would be to see dependency - skin in the game. It is one thing to partner with a small company to include their products (WYY, Samsung, presumably Bell), but what is the worst case scenario for these companies if customers don't show up for those particular offerings? Not much. It does seem to speak towards the nature/quality of the irons themselves that Samsung etc have hitched their pony to Wave regarding TPM-dependent TC implementation (and WYY, and perhaps Bell). To me those events indicate that the product itself is not a mirage, that it has potential.
When Bill walked into Wave he apparently saw potential, but by every account of his he also saw a dysfunctional organization. If the products are generally good for the task and if there is demand, then the organization must have been dysfunctional. This is a necessary component of the potential for turnaround. As Brant pointed out, Bill (and others) could be wrong.
Like waveduke I see next to zero value in using past failure to measure the moment in this circumstance. One could argue as Blue has that there should be sales by now, but that is entirely arbitrary, an unmeasurable, it has the value of saying "that is a pretty butterfly" to which I can only respond, "glad you think so". Heaps of information from a variety of sources speak towards sales cycles, and certainly one can arbitrarily discard them or not as they see fit, it is not particularly probative in either event but IMO even less so when speaking against the many examples of sales cycles (and the stated timelines of those currently wielding the irons).
Obviously stated timelines are part of expectation management, but those timelines were not 2015, and at the most recent opportunity to push the timeline (as waveduke dutifully points out) Solms declined to move the timeline and stated clearly the plan is on track.
I am all in on the notion of August doldrums and Sept often being a pretty busy month (and not speaking just of Wave by any means).
So Labor Day will come and go and from then on the clock ticks more noticeably, ticking louder everyday for the remainder of the year.
Back to the irons (this year):
VSC - any time now, this not only brings money, it gets the console installed.
SEDs - always available, and plugs into the console.
TPMs - this really for the moment for me is VSC, VSC is 'the killer app' that opens the door to TPM-TC
WEM - reportedly being reworked (heavens knows how the last trial/deployment went, a highly specialized customized thing for something like NSA or DIA or some such), can't imagine any money this year.
EMV - one can get an affirmed agreement, but no money this year
Micron - one can expect announcements about future product directions, but no money this year.
mobile TC - are we talking android here? if so then certainly not money this year.
tic-toc