Peraso(PRSO) - 2024 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue for Q2 2024 was $4.2 million, exceeding the high end of guidance, representing over 50% sequential growth and more than 70% year-over-year growth [6][16] - GAAP gross margin increased to 55.5% from 46.4% in the prior quarter and 25.3% year-over-year, while non-GAAP gross margin rose to 68.8% from 66.4% sequentially and 45.9% year-over-year [17] - GAAP net loss for Q2 2024 was$ 4.4 million or a loss of $1.88 per share, compared to a net loss of$ 2 million or $1.07 per share in the prior quarter and a net loss of$ 4.1 million or $6.68 per share in the same quarter a year ago [19] Business Line Data and Key Metrics Changes - Product revenue from memory integrated circuits and millimeter-wave products was$ 4.1 million, compared to $2.7 million in the prior quarter and$ 2.2 million in the same quarter last year, with approximately 80% from memory and 20% from millimeter-wave [16][33] - Shipments of end-of-life memory IC products increased to approximately $3.4 million from$ 2.4 million in the prior quarter, with a remaining backlog of approximately $9.1 million [7][16] Market Data and Key Metrics Changes - The company is focusing on expanding its millimeter-wave business across diverse geographies and end markets, with a current engagement pipeline of 95 total engagements, up more than 25% compared to the previous year [10][12] - The DUNE platform received its first volume production order from a South African service provider, indicating strong market interest and potential for future orders [11][12] Company Strategy and Development Direction - The company aims to convert existing customer engagements into production orders for millimeter-wave products and expects ongoing shipments of memory IC products to contribute to revenue and cash flow [15] - The anticipated guidance from the NTIA regarding funding for unlicensed spectrum fixed wireless access could significantly expand market opportunities for the company [14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong design activity in millimeter-wave technology, particularly in fixed wireless access and military applications, indicating a robust pipeline for future growth [23][24] - The company expects total revenue for the second half of 2024 to increase over the first half, with Q3 2024 revenue projected between$ 3.8 million and $4.2 million [21] Other Important Information - GAAP operating expenses for Q2 2024 were$ 6.8 million, up from $4.9 million in the prior quarter, primarily due to severance and software license charges [18] - The company had$ 1.9 million in cash as of June 30, 2024, a decrease of approximately $0.6 million during the quarter [20] Q&A Session Summary Question: Can you talk about the expansion in your engagement pipeline and customer diversity? - Management noted strong design activity in millimeter-wave technology and increasing opportunities in fixed wireless access, with new opportunities arising almost weekly [22][23] Question: How do you view the Wi-Fi 8 opportunity and development? - The company is considering collaboration with existing players rather than significant capital investment, focusing on fixed wireless and military applications for now [25][26] Question: What is the size of the market opportunity for the DUNE platform? - Management indicated that deployment is ready, and the speed of service provider adoption will determine revenue generation [27][28] Question: What is the potential impact of BEAD funding on fixed wireless access? - Management estimated that around 20 million homes in North America could benefit from fixed wireless technology, with expectations for funding eligibility to be announced soon [30][31] Question: Can you elaborate on military engagements? - The company has ongoing proof of concept deals and is seeing strong interest due to the stealth capabilities of their technology [39][40]