Hi all, just finished reading the 10 k, my initial thoughts (more like additional questions) are below in the order of the report;
-Shift in strategy now that 5th and 6th gen have been delivered, shift research dollars to S&M. What does this look like?
-more talk of the success of R&D - why is it a success? instead of ROIC?
-is the company maintaining too large a portfolio of products/ software? Especially in light of staffing shortages in software engineers? Would smaller portfolio lead to more focused co?
-Thermite Octal trials on hold with potential vendors of a large volume nature. Cited ability to customize specs as CA against competitions’ offerings
-the pandemic should be a killer to their whole business, but most evident in the fact that these products need an implementation staff and everyone has to quarantine for 14 days^2 (there and back)
-can they ever get to a point where an implementation staff is not necessary? Does this not give them the ability to scale up faster?
-effects of the sanctions on Chinese firms dinged $1.3mm in revenue. Interestingly, it was the UK government not the US government that blocked the sale. Too bad for the growth runway that exists in China, but with CODA so heavily dependent on keeping their technology secret, could end up being a blessing in disguise five years from now via stolen IP
-as mentioned, starting to see hiring issues in software development, meaning there is most likely some internal turnover(r&d slated to decrease)
-$560k in Davd sales in 2020, would like to understand the unit economics on those figures.
-product sales essentially flat y/y which is encouraging. Services biz down materially, but no surprises
-lower backlog to start the year, curious what that looks like
-who is their $4mm, 10% customer? Bae/Raytheon
-why do they book the $1mm davd gen2 funding as revenue? Should be other income?
-was taken aback how negative the tone was in the MD&A, but the financials honestly weren’t that bad considering. Products flat, margins only 200 bps lower, all services driven. Will make for good comps next year this time.
-easy to forget that 6 years ago, almost all revenue came from O&G services, now it is only 5%. Although on a small scale, excellent pivot
Looking to compare notes with the team so feel free to add/question/rip apart; makes us all better.
All the best,
Pat
