2 million in purchase orders and possible purchase
18 August 2004
Warren's Consumer Electronics Daily
Volume 4; Issue 159
E.Digital, moving to expand its Micro OS software platform for digital audio players, signed an agreement with a company in India to handle custom-built products, Investor Relations Vp Robert Putnam told us. The firm, whom Putnam declined to identify, includes 5-6 engineers who will work with e.Digital staff in Poway, Cal. E.Digital's 20-25 U.S.- based engineers will focus on technology integration and development, Putnam said. E.Digital will likely increase its stake in or purchase the India firm by year-end, Putnam said. Meanwhile, e.Digital's first-quarter loss grew to $782,153 from $642,612 a year ago as revenue plunged to $93,000 from $1.1 million. The sharp decline in revenue was tied to a one-month delay to July in purchase orders from airlines for the digEplayer. As of June 30, e.Digital had received $2 million in purchase orders, of which $1 million was recorded as customer deposits, company officials said. Potential Micro OS customers also postponed buying decisions in June as they studied Seagate's decision to enter the hard drive market for digital audio players, Putnam said. E.Digital is working with hard drive developer Cornice. Distributor APS, which is marketing the digEplayer, has sold more than 1,600 units to Alaska Airlines and has new orders from JetsGo and Hawaiian Airlines. Sales to APS accounted for most of e.Digital's revenue during the quarter, Putnam said. E.Digital, which ended the quarter with a $1.2 million deficit in working capital, closed on a $1 million offering of unsecured 12% convertible promissory notes on July 2. The notes include warrants for 2 million shares that can be exercised at 25 cents. -- MS
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