Energous Whiffs on Q4 Revenue as 2 Customers Extend Product Review Cycles

Energous’ prospects for generating meaningful revenue from deliverables for its wireless charging technology took another hit in Q4 due to customers’ decisions to extend review processes, said CEO Steve Rizzone on a Wednesday earnings call. Rizzone had referred on previous calls to a “large engineering services payment” in conjunction with delivery of the first iteration of a system Energous had been developing to spec for a "key strategic partner," but it couldn’t invoice for delivery due to the customer's decision to extend the review and acceptance cycle. “We have no guarantee that they will integrate this technology at all, even though the relationship continues to move forward,” Rizzone said. A second CE company planned a Q2 2019 product launch, which would have “triggered a meaningful order” in Q4 for manufacturing ramps that didn't occur. That customer is refining its specs to improve its product's user experience and competitive position, said Rizzone, saying Energous expects a Q2 chip order. The company announced Wednesday a direct securities offering of $25 million, less $1.7 million in expenses, to finance working capital and other general and administrative purposes. The company’s Q4 revenue was $56,000; net loss was $12.5 million, it said. Shares plunged 24 percent Wednesday at $6.21. Rizzone highlighted positive news -- availability of the Oasis-RC personal sound amplification product from Delight and vivo’s Mobile World Congress announcement (see 1902250053) it plans to incorporate Energous’ distance charging in a future smartphone. More negative news came from the regulatory front where approvals for wireless charging distance technology in Asia “are extending out.” Rizzone has expressed hope that FCC approval in December 2017 (see 1712270024) would be a model for regulators in Japan, Korea and China, but those countries chose to do their own studies along the same lines as the FCC approval process, he said Wednesday. At CES last month, Energous demonstrated its wireless charging technology in prototypes from Vuzix, Qubercomm, IDT, Austar and Deutsche Telekom.