WiSA Technologies Reports Q2 2023 Results

WiSA Technologies, Inc. (Nasdaq: WISA), a developer of spatial, wireless sound technology for smart devices and next-generation home entertainment systems, reported second quarter 2023 financial results in its Form 10-Q, which was filed on August 14, 2023. In its conference call and presentation today at 8:00 am PT / 11:00 am ET, management will discuss its WiSA E strategy and initiatives, the Company’s results, and provide a general business update.

“In July, after collaborating in 2022 and 2023 with strategic customers on features, performance, and pricing, we delivered WiSA E development kits to five Tier-1 HDTV and audio customers,” said Brett Moyer, CEO, President, and Chairman of WiSA Technologies. “We are excited about the prospects for WiSA E to unify a highly fragmented market currently served by proprietary, closed audio solutions. These customers alone each represent annual unit sales opportunities ranging from 1 million to 3 million, or potentially from $5 million to $15 million in revenue per customer, with revenue contributions expected as soon as second half of 2024. Customer enthusiasm thus far has been impressive, and one customer is already evaluating an embedded software IP solution for transmitting audio to its speakers from their soundbar. In a few weeks, we will be launching WiSA E to the rest of the audio industry at the CEDIA trade show.”

“We continue to explore strategic opportunities, and the team just completed two weeks of discussions in Asia focused particularly on ways to leverage the value of our intellectual property, such as that embedded in WiSA E. Concurrently, progress is being made toward a definitive agreement to acquire Comhear and expand our IP portfolio,” continued Moyer.

“For the first time since May of 2022, we are seeing consumers return to purchasing audio products. Our unaudited consumer audio product sales in July 2023 have essentially matched Q2 2023 sales. With higher consumer demand for audio products, a new WiSA DS enabled soundbar launching in Q4, and typical seasonality, we expect sequential revenue growth in Q3 and Q4 of this year,” added Moyer.

Q2 2023 Financial Highlights

• Q2 2023 revenue was $0.4 million, compared to $0.9 million in Q2 2022 and $0.5 million in Q1 2023.
• Q2 2023 gross margin as a percentage of sales was negative 47%, compared to 20% in Q2 2022 and negative 267% in Q1 2023. The decrease in gross margin in Q2 2023 compared to Q2 2022 was mainly attributable to a $169,000 increase in inventory reserves associated with our consumer audio products, lower sales volumes in relation to the fixed portion of costs and lower pricing of our consumer audio products.
• In April 2023, we received net proceeds of approximately $1.0 million through the issuance of common stock and warrants.
• In April 2023, the Company paid off in its entirety the outstanding balance due under the Company’s Senior Secured Convertible Note issued on August 15, 2022.
• In May 2023, we received net proceeds of approximately $1.9 million in connection with a warrant exercise inducement.
• At June 30, 2023, cash and cash equivalents were $2.0 million.

Subsequent Financing Event