mymoneybegone: Thanks for a great CC sinopsys...
The one issue that took my concentration away was the following paragraph in today's earnings PR:
"...While it is not possible to predict with any certainty the volume of anticipated shipments, based on joint marketing and sales discussions with its OEM partners, Wave's preliminary expectations are that in excess of 50 million PC's or motherboards that include Wave's Trusted Computing software could be shipped by Wave's current OEM partners over the next three years. Wave's current shipment expectations are based only on the product lines on which Wave's software is currently expected to be bundled by its existing base of OEM partners. These estimates could change at any time. There are no contractual commitments by OEM partners for minimum royalties or minimum product shipments. For each unit of its software bundled on an OEM partner's PC or motherboard that has been shipped, Wave is entitled to royalties which can depend on volumes shipped by each OEM..."
Given IDC's forecast of about 350 million TPM's over the next 3 years Wave's stated forecast would translate to a market share of about 1/7, or about 14% .... Clearly not a figure that makes sense in any which shape or form....
I had been on hold during the cc for some 45 minutes before being cut-off and never having had the opportunity to ask clarifying questions on the above. So I decided to call Steven Sprague on his cell phone within 2 minutes of the conclusion of the cc. Steven took the phone and gave me all the time I wanted.... (Thank you Steven Sprague!)
I told him that we investors depend on PR's, share holder meetings and the occasional email exchange with the company to paint a picture of the state of the company. I mentioned the above paragraph and explained the market share figures...and how they might come across to investors...
Steven Sprague interjected very quickly that the figures given are based on contracts in hand and exclude anything else like potential deals with the Government, potential enterprise deals, potential additional PC OEM, chip and motherboard bundling deals...
The intention of the "forecast" in today's PR was to show what a small deployment - presently at hand - can do for the company as far as revenue potential is concerned...and that it would be wrong to conclude that this a fixed figure for the next 3 years...
Mr. Sprague expounded on the fact that a 10% activation/upgrade would translate into a 250 million dollar figure...just based on a 50 million deployment...but the activation could also be 40%.... or [my comment] 1 billion dollars on 50 million deployment...
Now imagine 150 million deployment at 40% activation/upgrade over the next 3 years...and given the fact that the target market is enterprises I wouldn't know why this would not be possible...
So, yes, helpfulbacteria is right: Nothing has changed...only the world around us...
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