Microvision stock price lost nearly 20% immediately following the Q1 2012 Conference call. For long term shareholders this a trend following the last several conference calls. CEO, Alexander Tokman stated, Microvision has 3 Core Objective for 2012. Secure OEM commitments for the PicoP Gen2 engine, launch the technology with partners, and finally, transition to Image by PicoP brand and license model. Currently there are several OEM’s who have purchased PicoP Gen2 evaluation kits including a Tier 1 automotive supplier and what Tokman referred to as a “major industrial supplier”. Microvision’s primary customer, Pioneer, is scheduled to release their heads up display product in the middle of this year. Microvision also reminded shareholders about Pioneer’s partnership to produce the PicoP Gen2 for its own product in which Microvision will receive royalties. Direct green lasers, key to Microvision PicoP Gen2 engine, will be ready for Pioneer’s product launch along with a limited supply for other potential OEMs.
Microvision has been burning through cash and expects to achieve a 4 million burn rate next quarter. With 6.8 million in cash, Microvision must develop significant sale orders during next quarter in order to keep the lights on. One investor commented “you can’t run the company on selling evaluation kits”. Microvision's response was they hope to generate cash from up front licenses, royalty fees from Pioneer, and the continued revenue from the ShowWX product line. However, Tokman stated that the company will need to generate additional orders other than Pioneer to stay afloat. Microvision is currently looking into various methods in order to raise capital.
In the next couple months, Microvision needs to announce significant orders or partnership with OEM’s in order to generate revenue. Online posts from Microvision employees hinted at significant layoffs which indicates the company is aggressively trying to reduce operating cost as well as trim positions that do not fit with their transition to the Image by PicoP license model. At this time, Microvision only has one true customer which is Pioneer and only enough cash to last until summer. Partners such as WoWee One and ES Plus Korea were never mentioned and no official date of their projectors are scheduled. I can only speculate that both WoWee One and ES Plus are waiting until everything is in order to embed the PicoP Gen2 engine within their product.
