For those who keep claiming that there have been no revenues from the licensing of software to Sigma's partners since there have been no 8Ks issued disclosing the terms of contacts, all I can say is I disagree and you need not read any further.
For those who are interested in evaluating for yourselves some information that the company has provided in PRs, 10K, 10Q and the S-1 this year, reach your own conclusions.
Recent SigmaLabs PRs.
SANTA FE, N.M. – July 6, 2016 -- WOODWARD JOINS SIGMA LABS’ EARLY ADOPTER PROGRAM
Woodward will obtain a non-exclusive license to use the complete suite of PrintRite3D® software modules – INSPECT™, CONTOUR™ and ANALYTICS™ – for one price, with preferred rates for future product license purchases.
SANTA FE, N.M. – April 18, 2016 – SIGMA LABS AND SPARTACUS3D SIGN AGREEMENT FOR COLLABORATION IN EUROPE
“We previously announced that Spartacus3D, a leading French AM service provider, had signed up for our Early Adopter Program in 2015; since then, they have fully installed our software and now use it regularly.
SANTA FE, N.M. – March 7, 2016 – SIGMA LABS ANNOUNCES CONTRACTS WITH AEROJET ROCKETDYNE FOR AIR FORCE PROGRAM AND “AMERICA MAKES” INITIATIVE
...today announced that it has received a contract from Aerojet Rocketdyne, a subsidiary of Aerojet Rocketdyne Holdings, Inc. (NYSE: AJRD), for a non-exclusive license of the Company's PrintRite3D® software applications. Terms of the award were not disclosed.
Separately, Sigma Labs received an order from Aerojet Rocketdyne under the previously-announced “America Makes” additive manufacturing research project with GE Aviation. The program, funded by the National Additive Manufacturing Innovation Institute (NAMII), uses Sigma Labs’ proprietary In-Process Quality Assurance (IPQA®) software for advanced AM monitoring.
So these PRs over the last few months have announced agreements for the use of Sigma's software with three different companies. For what ever reason (maybe keeping their pricing secret until sales were better established), Sigma elected to not disclose the financial details of these contracts when they were announced, nor did they issue 8K's. In my opinion 8K's were not required since selling their software and services is their ordinary course of business and the 8K disclosure requirements do not require disclosure of agreements made in the ordinary course of business.
But now Sigma has decided to disclose their pricing structure by showing their past PrintRite3D revenues in the new Company Stock Prospectus, S-1, Figure 4, page 37.
For the 3 companies listed above, Sigma has now identified the following details of the revenues from the recent licenses for PrintRite3D® systems and software:
Woodward.................$114,800 for 1 system
Sartacus3D...............$125,000 for 1 system
Aerojet Rocketdyne....$250,000 for 2 systems
So about a half of a million dollars in recent revenues (March through June) from these three companies, with more revenue from servicing fees to continue in the future.
Also while reading the S-1, I found an interesting discussion about the use of the term "Software as a Service". This is common IT industry term used to describe how a company maintains their software on central servers and their customers gain access through the internet. The software is not actually delivered to the customers. This is how Sigma operates. So I think what they have been doing in the 10Ks and 10Qs is including the revenues from PrintRite3D licenses under services, since they have been delivering their Software as a Service. In addition, if you look at the revenue projections they have provided in the Qs and Ks in the past for their active consulting contracts, the quarterly services incomes reported under the Statement of Operations were larger and growing faster than their projections, even though the number of active contracts were going down and they were projecting lower revenues from the consulting services. So my conclusion is that the larger than expected "services" income was due to the software revenues being lumped in with the consulting services revenues.
This may change in the next 10Q since they are no longer trying to "hide" their pricing structure and they may break out the software revenues as a separate line item, but maybe not.
