SunWorks Inc (SUNWQ)

[SCJCPA]

It would be true to say revenue is primarily comprised of the monthly payments provided by the paying customers.

However, it would not be true to say that the losses are based on the system installations. The installation expenses are matched up with the revenue over the long-term customer contract. This means every month they record revenue they are also recording the proportional amount of installation expense.

I'm still at work and don't have lots of time to look into the drivers behind ALL of Vivint's losses. Glancing at their financials though, it looks like a lot of their losses are coming from depreciation expense on the cost of the solar systems they have sitting in inventory. They have close to $500M in solar systems in inventory! That's nuts considering they could all be obsolete at the drop of a hat if the Solar3D cell revolutionizes things like we're expecting.

Another drivers of the loss are sales and marketing, general and administrative (stock-based compensation, professional fees, ect), amortization of nearly $15M of a intangible asset related to when Vivint was acquired in 2012, and interest expense of nearly $10M annually.

I hope that gives you a better idea of how we stack up against the competition. It was interesting looking at their financials. I'll have to go back and look at them in more detail later. All I can say right now is that I would take SLTD's financials over VSLR's any day of the week. They had a $128,000,000 Net Loss as of the end of 9/30/14 with $105,000,000 lost in company's operations! I thought I was bleeding cash this past week... During the same period, SLTD had a $17M Net Loss because of $18M in non-cash expenses and $418K GENERATED by business operations. I guess one could say our actual business operations were $105,418,000 ahead of VSLR for the first nine months of 2014! Crazy