05.14.19
eMagin Corporation announced financial results and corporate highlights for the first quarter ended March 31, 2019.
Revenues for the first quarter of 2019 were $6.1 million, a decrease of $0.8 million from revenues of $6.9 million reported a year ago, but up sequentially by $0.7 million from the fourth quarter of 2018.
Product revenues were $5.5 million as compared to $5.9 million in the first quarter of 2018. On a sequential basis, product revenues grew 13% from 4Q18. The year-over-year decrease in product revenue was due to display production related issues from the fourth quarter of 2018 which impacted the first quarter. Contract revenues totaled $0.6 million in the first quarter compared to $1.0 million in the same quarter of last year, reflecting the lower level of development work required at this phase of the consumer contract work to develop the 4K x 4K display. Government contract revenues during the quarter were largely unchanged from the prior year period.
Overall gross margin for the first quarter was 22% on gross profit of $1.3 million compared to a gross margin of 29% on gross profit of $2.0 million in the prior year period. The decrease in gross margin was primarily due to lower revenues in the quarter compared to the year ago period.
Operating loss for the first quarter was $2.2 million versus an operating loss of $2.6 million in the first quarter of last year. Net loss for the first quarter of 2019 was $1.4 million, or $0.03 per diluted share, compared to a net loss of $2.1 million, or $0.05 per diluted share, in the first quarter of 2018.
“We are seeing growing demand for our products, particularly with US military and aviation programs and with new and existing international customers,” said CEO Andrew Sculley. “During the first quarter of fiscal 2019, we made progress towards our goals of securing new US military programs and broadening our presence in foreign military applications and in industrial and medical markets.
“We continue to participate in government discussions on microdisplay development for future defense aviation/mounted/dismounted programs and to position our displays as a key component of the future Soldier System 2030 technology suite for enhanced soldier performance and accelerated decision making,” Sculley added. “In the first quarter alone, we sold to over 70 customers and supplied products for over 20 new programs. Our backlog of products scheduled for delivery through March 31, 2020, continues to be solid at $10.7 million, an increase of approximately $100,000 over the backlog of $10.6 million at Dec. 31, 2018.
“I am pleased with the progress we are making with our largest (4K x 4K) full color display which we are developing in collaboration with our Tier 1 consumer electronics customer to incorporate into a consumer headset,” he noted. “We are also working with a new medical device manufacturer on development of next generation diagnostic equipment. We believe the high resolution, high contrast, and brightness of our OLED displays have strong appeal across both defense and commercial industries, and we continue to pursue new opportunities.
“On the military side, we are continuing to win new programs and support existing ones. Many of these are long duration programs which we support for their entire lifetime,” Sculley added. “While we provide displays to the newer U.S. Army Enhanced Night Vision Goggle (ENVG) III and ENVG-B programs, we recently received a $627,000 order for displays under the ENVG II program that we have supported since 2013. In addition, ground and flight tests were successfully completed for a major U.S. Army helicopter helmet upgrade program which involves retrofitting our high brightness microdisplays into the current fielded helmet.”
Revenues for the first quarter of 2019 were $6.1 million, a decrease of $0.8 million from revenues of $6.9 million reported a year ago, but up sequentially by $0.7 million from the fourth quarter of 2018.
Product revenues were $5.5 million as compared to $5.9 million in the first quarter of 2018. On a sequential basis, product revenues grew 13% from 4Q18. The year-over-year decrease in product revenue was due to display production related issues from the fourth quarter of 2018 which impacted the first quarter. Contract revenues totaled $0.6 million in the first quarter compared to $1.0 million in the same quarter of last year, reflecting the lower level of development work required at this phase of the consumer contract work to develop the 4K x 4K display. Government contract revenues during the quarter were largely unchanged from the prior year period.
Overall gross margin for the first quarter was 22% on gross profit of $1.3 million compared to a gross margin of 29% on gross profit of $2.0 million in the prior year period. The decrease in gross margin was primarily due to lower revenues in the quarter compared to the year ago period.
Operating loss for the first quarter was $2.2 million versus an operating loss of $2.6 million in the first quarter of last year. Net loss for the first quarter of 2019 was $1.4 million, or $0.03 per diluted share, compared to a net loss of $2.1 million, or $0.05 per diluted share, in the first quarter of 2018.
“We are seeing growing demand for our products, particularly with US military and aviation programs and with new and existing international customers,” said CEO Andrew Sculley. “During the first quarter of fiscal 2019, we made progress towards our goals of securing new US military programs and broadening our presence in foreign military applications and in industrial and medical markets.
“We continue to participate in government discussions on microdisplay development for future defense aviation/mounted/dismounted programs and to position our displays as a key component of the future Soldier System 2030 technology suite for enhanced soldier performance and accelerated decision making,” Sculley added. “In the first quarter alone, we sold to over 70 customers and supplied products for over 20 new programs. Our backlog of products scheduled for delivery through March 31, 2020, continues to be solid at $10.7 million, an increase of approximately $100,000 over the backlog of $10.6 million at Dec. 31, 2018.
“I am pleased with the progress we are making with our largest (4K x 4K) full color display which we are developing in collaboration with our Tier 1 consumer electronics customer to incorporate into a consumer headset,” he noted. “We are also working with a new medical device manufacturer on development of next generation diagnostic equipment. We believe the high resolution, high contrast, and brightness of our OLED displays have strong appeal across both defense and commercial industries, and we continue to pursue new opportunities.
“On the military side, we are continuing to win new programs and support existing ones. Many of these are long duration programs which we support for their entire lifetime,” Sculley added. “While we provide displays to the newer U.S. Army Enhanced Night Vision Goggle (ENVG) III and ENVG-B programs, we recently received a $627,000 order for displays under the ENVG II program that we have supported since 2013. In addition, ground and flight tests were successfully completed for a major U.S. Army helicopter helmet upgrade program which involves retrofitting our high brightness microdisplays into the current fielded helmet.”
