Wireless Ronin Technologies, Inc. (
Q2 2011 Earnings Call
August 3, 2011 4:30 PM ET
Erin Haugerud – Manager, Communications and IR
Scott Koller – President and CEO
Darin McAreavey – SVP and CFO
Darren Aftahi – Northland Securities
Marco Rodriguez – Stonegate Securities
Ty Lilga – Feltl & Company
Jim Schurr – Stifel Nicolaus
Arthur Freedman – Freedman Asset Management
Joseph Novak – Novak Knowledge
Previous Statements by RNIN
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» Wireless Ronin Technologies, Inc. Q2 2010 Earnings Call Transcript
Good day ladies and gentlemen and welcome to the Wireless Ronin Technologies Q2 2011 earnings conference call. At this time, all participants are in a listen-only mode. Later we’ll conduct a question and answer session and instructions will follow at that time. If anyone should require assistance during the conference, please press star then zero on your touchtone telephone. As a reminder, this conference call is being recorded. I would now like to introduce your host for today’s conference, Miss Erin Haugerud. You may begin.
Thank you and welcome everyone to our second quarter 2011 conference call. With me today at Scott Koller, President and CEO, and Darin McAreavey, Senior Vice President and CFO. Following Scott’s opening remarks, Darin will review our financial performance for the quarter, then turn the call back over to Scott for an operational update and closing remarks. Then, we will open up the call to your questions.
Today’s call will be an interactive webcast that will feature presentation slides of the second quarter 2011 financial results. To access the webcast, please go to the investor section of our corporate website at www.wirelessronin.com.
Please note that the information presented and discussed today include forward-looking statements made on the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995. Our actual results in future periods may differ materially and you should not attribute undue certainty to our forward-looking statements. Risks and uncertainties that could cause our actual results to differ from those expressed or implied are forward-looking statements, including those set forth in the risk factor section of our annual report on Form 10-K we filed on March 22, 2011.
In addition, our comments may contain certain non-GAAP financial measures including non-GAAP operating loss per share. For additional information, including the reconciliation from GAAP results to non-GAAP measures, how the non-GAAP measures provide you with full information and why we use non-GAAP measures, please see the reconciliation section of our press release, which appears on our website at www.wirelessronin.com.
I’ll turn the call over to our President and CEO, Scott Koller. Scott.
Thank you Erin. Good afternoon everyone and thank you for joining us today on today’s call to discuss Wireless Ronin’s second quarter 2011 results, which were issued in a press release after the close of market today.
Q2 marked our fifth consecutive quarter of year over year revenue growth as we continue to drive revenues and expand margins. Our improving top line and bottom line performance demonstrates the strong demand for our industry leading digital signage and marketing technology solutions. It also reflects our strategic shift from hardware centric offerings to a higher margin software and services business model.
But before I comment further about the quarter, I would now like to turn the call over to our CFO, Darin McAreavey to take you through the financial details of our results. Afterward, I will talk about our operational highlights and business outlook. Darrin.
Thanks Scott and good afternoon everyone. As Scott mentioned, it was a record revenue quarter for Wireless Ronin. Our revenue increased 27% sequentially to a record $3.1 million as well increased 59% over the same year ago quarter. The increase was primarily attributable to the $1.8 million order received during the quarter for installations at 200 Chrysler dealerships.
Recurring revenue in Q2 generated from our hosting and support services was approximately $400,000 or 13% of total revenue. In fact, software revenue increased 184% over the same year ago period to $623,000. This demonstrates our focus on increasing our higher margin software and hosting services mix on an absolute and relative basis.
At the end of the quarter, we received purchase orders totaling approximately $1.6 million that were not recognized as revenue during Q2. We expect to fulfill these orders during Q3.
Revenue for the six month ended June 30th, increased 82% from the same period a year ago to a record $5.5 million. Gross margin in the second quarter 2011 was 46%, which was unchanged from the prior quarter and declined two points from the 48% for the second quarter of 2010. This was primarily due to a higher percentage of hardware sales during the second quarter of 2011.
On a GAAP basis, our Q2 net loss totaled $1.4 million or $0.07 per basic and diluted share. This is an improvement from our net loss of $2.3 million or $0.12 per basic and diluted share in the previous quarter as well as an improvement from our net loss of $2.1 million or $0.12 per basic and diluted share in the same year ago quarter. The improvement was driven by $500,000 of additional gross margin dollars when comparing Q2 to each of the two prior periods.
Net loss for the second quarter of 2011 included $178,000 of non-cash stock compensation expense. Excluding non-cash charges, our Q2 non-GAAP operating loss totaled $1.1 million or $0.06 per basic and diluted share, representing a $700,000 improvement from our loss of $1.8 million or $0.09 per basic and diluted share in the previous quarter and a $600,000 improvement from a loss of $1.7 million or $0.10 per basic and diluted share in the same year ago quarter.