Supply Chain Disruptions Spur Summit Wireless Product Redesigns

Redesigns don’t involve the company's entire speaker, Moyer said on a Wednesday earnings call. Giving a DSP processor with 50-week lead time as an example, he said, "If there’s another one with maybe 15-week lead times, or 20-week lead times, that’s a substantial change.” It takes time to retune the speaker, he said, but “to the consumer it’ll look exactly the same.”

The Wireless Speaker and Audio Association (WiSA) expects “brutal price changes” as new inventory comes into the Platin product line in Q1, Moyer said. That follows Sept. 1 price hikes. “We’re trying to sort through what’s transitory vs. permanent” on supplier price hikes, he said. Summit doesn't have insight into "other people’s problems with other parts until they indicate that through adjustments on the P.O. delivery dates,” he said. Revenue guidance is around orders on the books plus an estimate of what holiday sales will be for Platin Audio, he said.

Moyer used his earnings call platform to peddle a Platin $100 holiday discount on ODM-sourced Milan and Monaco WiSA speaker systems. Rolling Stone gave the $899 Platin Milan the “best home theater system” nod in its current Essentials list, Moyer noted on the call. At least one order came in from a caller during the event, he observed.

Consumers will find “tight supplies” during holiday shopping across “all brands," Moyer said. WiSA will do more Black Friday and Cyber Monday promotion around the Milan product but is unlikely to do much more on Monaco beyond the $100 due to supply. "We have brands that are strong internationally that haven’t launched in the U.S. because they can’t get pipeline inventory to launch,” he said.

Responding to a question on the next-generation WiSA product line, geared to more mainstream customers, Moyer said part of the reason WiSA launched the Platin line was to have “an early adopter of the next generation.” When it announces product and timelines for the second generation, he expects the Platin version to launch within four or five months of the announcement. “It helps the sales cycle to be able to tell prospective customers that this technology is in consumers’ hands.” It could take other brands a year to bring product to market after launch, he said. Comparing the two WiSA systems, Moyer said the next system will be at a “substantially lower price” than products in the market today, with associated "performance softening.” Products will be within the requirements of Dolby and the main brands, he said.

WiSA isn’t attending CES 2022 as an exhibitor, but will hold a next-generation product demo, under nondisclosure, in two suites at the Embassy Suites next to the Las Vegas Convention Center's South Hall, Moyer said. “When you had to make the decision back in the summer, it was highly doubtful that there would be a large contingency coming to CES out of Asia, and I still think that’s true,” he said. “I can see a small contingent coming, but the re-entry going back to Asia is pretty hard for those people.”

When WiSA exhibited at the Venetian during CES in the past, Asian companies typically would visit the suite "in waves," with management, product managers and engineers on different schedules. “If you don’t have that, it’s smarter, I believe, for us to continue to drive the expansion of the WiSA category through the Wave,” he said, referencing the company’s marketing program launched this year to drive visitors to the WiSA website (see 2107220027). For this year at least, it would be smarter for WiSA to try to expand WiSA awareness through the Wave program “vs. spending a lot of money on being inside the CES trade show.”