Here's some chicken scratches of what I was able to glean from the call. I missed the end. Enjoy.
Update
• Revenue up in OEM business, but unit volume decreased from 1 year ago. Looking for recovery in enterprise market to really increase the overall $$$
• Customer level/interest increased, but not manifesting in volumes yet
• Encrypted volume units up
• # machines with encrypted drives going up (re-orders and new customers)
• Acer volumes increasing but not quantified yet
• Dell has highlighted encrypted drives as a preferred solution on web site (Vostro, Latitude) Vostro is new business targeted at <100 users in a corporate environment. Also available on some desktops
• Samsung SSD marketing will ratchet up later this year
• PC software upgrades: Q1 to Q2 enterprise upgrades increased. More enterprise seats sold in Q3 vs. all of Q2 based on a number of deals.
• Significant business growth in Europe as well as N. America
• Well positioned for growth over the next year
• Enterprise server seats have been sold to manage encrypted drives
• Starting to see larger interest in software upgrades for TPM based opportunities (currently have 1000 seat pilot for a company with 60K to 70K potential seats). Possible interest from government as well.
• Market development updates: US Army aggregates purchases into consolidated buys. All laptops now have SEDs an option. Expecting that this will be changed to be a requirement by the end of this year or early next year
• Three forms of revenue: OEM pays Wave, Enterprise software upgrade, services based on recurring revenue from large installed TPM base. Q1 demonstrated 1st service solution. Will see more of this in the future. Progress in electronic signature areas (mortgages, insurance etc.)
Questions
• John Cangelosi, private investor: What’s Asia business like? Number of starts into Asia. One opportunity was stalled when the company was subsequently acquired. Want to get stronger in revenues before we invest more $$$ there. Expecting more financings? Still an emerging business. Still might be times to invest into growth. Hopefully the days are behind us where we need to fund to meet payroll. Does Wave want to get bought out? Just starting to scratch the surface of our opportunity. This is a subscriber/management business. Unclear how we will manage it. Example: every channel on TV has a user name & password
• Abdul Salle: Dead air.
• Ronald Meyer, REM financial: Has any government agency began purchasing SEDs? Some are buying, but Wave doesn’t see details yet and may not from Dell. Specific volume important, but more important is that it’s a public big customer that endorses the technology. People want to see that others are adopting the technology. Role of Admiral Inman in Wave? Been in the space for years and is well respected and well known. Helpful to influence and educate key influencers in government. Can you impact in SEDs and how they affect TPM turnon rate? Laptops are usually bought as a commodity. Now the technology will help improve the security of things. Biometrics are the same but they’ve been a tough sell. Windows 7 will help with this.
• Montgomery Churchman, private investor: Can Wave benefit from heathcare stuff? Looking for legislation mandating that machines must not be anonymous. TPMs can be used for this. Does this need to be written into law? Yes an opportunity in the legal framework, rule making, rule interpretation etc.
• Abdul Salle x2: What’s non-core business opportunity like? Healthcare, some government good. Financial services renewed interest. Big systems integrators and consulting firms getting interested. Big investment so far in identity of user, not yet in identity of machine. Also subscriber management of internet very big. Are customers opening up to more business these days? Really bad in jan-Mar. Much warmer through Q2. Haven’t quantitatively seen it yet on enterprise machines. Hope over the course of the next few months for this to be apparent. Will there be growth there? 40-50% growth possible just to get back to 2008 numbers. Prior to that, PC industry was double digit growths. COGS increase? No, it did not go up. What is the gross margin? $386K of direct cost of sales vs. $4.8M of revenue.
• Timothy Collins, private investor: What is the sales process you’re going through? Added some new sales people that are already closing accounts. # seats per average transaction going up. Moving out of pilot into production.
AI
