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» Socket Mobile CEO Discusses Q2 2011 Results - Earnings Call Transcript
Now with that said, I’d like to turn the call over to Socket’s president and CEO, Kevin Mills.Kevin Mills Thanks, Jim. Good afternoon everyone and thank you for joining us today. In today’s call, I’ll begin with a brief review of our Q2 results, then discuss the business opportunities we see ahead and our outlook for 2012. Our revenue for the second quarter was 4 million, consisting of 2.1 million of SoMo related sales, 1.6 of cordless scanning related sales and 300,000 from service and other legacy-related products. Q2 revenue was essentially flat compared to Q1, reflecting the impact of the transition we have been going through with both our product families. Both our next generation handheld computer and new cordless scanning products are now shipping, and we expect to be well-positioned to see growth in both categories in the third quarter and going forward. Revenue from our SoMo product line was impacted by customers waiting for our next generation handheld, the SoMo655. We started shipping the new 655s in late Q2, a few weeks later than originally expected. Based on our late quarter shipments and the fact that we only recognize revenue based on sales out of distribution, we only recognized about $10,000 of revenue within our stated second quarter results. The positive side of this minor delay is that sales of our previous version, the SoMo 650, remained strong in Q2, and we began the process of transitioning our existing and new customers over to the 655. We also completed a transition in our cordless scanning business during Q2, for the phasing in of our Apple-certified version, the 7ci, which utilizes a cost-reduced 1D scanning engine that positions the scanner nicely within our Apple-certified product family. This introduction allows us to consolidate our lower-priced 1D scanning offerings into a single product.
I’d now like to provide more detail on each product family, starting with the SoMo handheld product business. We expect the transition to our new and enhanced SoMo655 to be completed during Q3. In Q2, we sold 3,776 standard SoMo650s, an increase of 70% over the same period last year and 8% more than in Q1. So overall demand for the product remains solid. We have approximately 1,000 SoMo650 units in distribution, which is about three to four weeks’ supply, and once the supply is exhausted, we expect our customers to move rapidly to the newer 655 model. We are currently stocking our distribution channels and these units are being purchased by existing and new customers for compatibility and validation testing for their applications and usage scenarios, prior to final deployment. Several of these customers were members of our beta testing team, and we’ve already seen these customers completing their qualification tests without any issues. However, as with most corporate deployments, we typically don’t see or expect transition to new devices to start in earnest until the last of the existing supply of qualified units are depleted.Read the rest of this transcript for free on seekingalpha.com