‘Tier 1' Customer Places First Purchase Order With MicroVision for 2019 Product Launch
MicroVision landed its first purchase order to supply components for a laser-beam-scanning display system it developed for a “Tier 1 technology leader” under an April 2017 contract in preparation for a second-half commercial product launch, said CEO Perry Mulligan on a Wednesday earnings call. As on recent calls (see 1903060009), Mulligan wouldn’t identify the customer or speculate on the scale of the launch, which is expected to involve head-mounted displays for augmented and virtual reality.
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The purchase order was for “production material,” and will cover the customer’s requirements for the “near term,” said Mulligan. “While there are a few terms on the purchase order to be finalized, we expect to start shipping these products as early as June.”
Mulligan sought to downplay expectations that commercial progress with the Tier 1 customer would bring immediate dividends to MicroVision, which has struggled to keep its stock from being delisted on the Nasdaq. “While many people might view the purchase order as the start of the activity to enable a product launch,” that’s not “always the case” when working with “Tier 1 customers like this,” he said.
Customer and product “road maps” need to be developed and production plans set, among other activities “behind the scenes,” said Mulligan. MicroVision expects to land additional purchase orders from the customer in the second half, “representing a major milestone in a very lengthy process,” he said.
Mulligan turned aside questions about the anticipated scale and scope of the Tier 1 customer’s product launch. “We have not had those conversations with our customer on how they perceive or how they plan to enter the market with their products,” he said.
Lincoln Park Capital will infuse MicroVision with up to $11 million over the next two years under a stock purchase agreement announced Wednesday. The deal includes an immediate $1 million investment through the purchase of stock at 98.2 cents a share. The stock closed 1.9 percent lower Thursday at $1.01. The infusion comes at an opportune time for MicroVision, which reported Wednesday it burned through half its available cash in Q1 ended March 31 and had just under $7 million in reserve.