Socket Mobile (SCKT) 27 Apr 232023 Q1 Earnings call transcript

Welcome to Socket Mobile, Inc. Q1 2023 Earnings Call. My name is Erica, and I'll be your operator for today's call.

Before we begin, I'd like to remind everyone that this conference call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E for the Securities and Exchange Act of 1934 as amended. Such forward-looking statements include, but are not limited to statements regarding mobile data collection and mobile data collection products, including details on timing, distribution and market acceptance of products and statements predicting the trends, sales and market conditions and opportunities in the market in which Socket Mobile sells its products. Such statements involve risks and uncertainties, and actual results could differ materially from the results anticipated in such forward-looking statements because of the number of factors, including, but not limited to the risk that manufacture of Socket's products may be delayed or not rolled out as predicted due to technological, market or financial factors, including the availability of product components and necessary working capital, the risk that market acceptance and sales opportunities might not happen as anticipated, the risk that Socket's application partners and current distribution channels may choose not to distribute the products and may not be successful in doing so. The risk that acceptance of Socket's products in vertical application markets may not happen as anticipated as well as other risks described in Socket's most recent Form 10-K and 10-Q reports filed with the Securities and Exchange Commission.

any update undertake statements. such not does obligation any to forward-looking Socket

Zhao, I the are over begin. Chief Dave Lynn today with to Business Financial Mills, and On Mills, me Officer; Kevin Kevin Mills. call you the now would like Chief Kevin Executive Officer; Chief call Officer. may Holmes,

today. you, afternoon, and everyone, Thank thank you operator. Good for joining us

million million, Our XX% decrease $X.X was the $X.X a in revenue XXXX. QX to QX compared

an reported loss compared of to XX.X% compared gross an of Our were to we $XXX,XXX margins XX.X% $XXX,XXX and in operating operating income QX XXXX.

disappointing. revenues activities. were results QX inventory distributor impacted balancing Our QX were by

align Our distribution times, and demand impacted the chain on the and our partners based this supply revenue. reduced better their as they in inventory with QX changes their in levels lead ongoing rebalance inventory to levels

In in addition, see a and general slowdown than our off the sector we of was in a interest year as retail slowdown rates business. lower driven U.S. inflation did the internationally not caused start. a We combination got higher overall expected retail similar the and slow demand to

of in impact revenue these many is in news our we as and second QX to our previously development our said new expected half call, on our the efforts most the were new good year, products of positively expected half products expect of track, XXXX to revenue to until we The launch to the half remain expect outlined. challenging to XXXX. on as and we add of of not be them As first last the second the

the on balance the turn dependencies said, now for I retail our would reducing impact believe opportunity. overall Mobile sector like sector and to over new his company of comments. better products new The markets, products has of a Dave call to As where targeted are these With the business. market many our at that explain, introduction will these large Holmes Dave of nonretail Socket we will by

milestones achieved Today, a and QX the data company. we as about more talk of that we up a and like Thank you, have coming of the to everyone. bit good comprehensive highlight continue afternoon, journey in becoming capture our some Kevin, products new little I'd significant few of we a

unified continue that tool improving multiple of all had gaming capture software. their We end typically with data users. CaptureSDK, our data provider with to development partners integrate our includes One now entire Socket capture access CaptureSDK support all set our providers integration to software app supports to portfolio. products. CaptureSDK gives Mobile App parties camera-based

Socket Now users. all we with integration support one with Mobile, can of end their

For now the ultimate utilize into performance. latest to camera-based hardware scanning And SocketCam data our cost-conscious best-in-class made QX, of free CaptureSDK. In scanning progress significant end versions is we our experience, deliver our promoting CXXX, the free continue scanners software that users can camera built capture technology.

are camera with apps partners to version their SocketCam. the latest app updating Our spanning CaptureSDK with of enable

in enabling value apps. We're made excited about end great positive base users implementation monthly Store end announce capture Store. of to support SocketCam Google's the both extremely Store based future data the will CXXX ease conscious in QX. select same cost more The we needs. critical, best Apple's need on to advanced first to that adopter to requirements conscious in complex partners their have their app and from quarter of basis the our app users and installed version out the read have and on version their of partners be application, barcodes to Building through SocketCam version the App The SocketCam Play the to of apps. these scanning users second unique happened strides or app users is allow subscription now XXXX, on free early and our form will successful App QX instant thousands on end of access an in damaged with of of brings free more This users releases option upgrade to been and to a their it that able upgrade who to the a the

to this As each the customers upgrade with will SocketCam revenue Mobile provide Socket recurring month. stream CXXX, a

apps and and industries variety is field inventory SocketCam name entry apps, a supporting of being in just order Delivery services, few. adopted wide markets. to a

to capture continue scanner data also the capture is our this opportunities critical scanning hardware iPhone we the believe camera released for and more we journey. DuraSled complete a data step and us company. In will a move QX, in barcode XX. Our It software forward make Bluetooth

Socket sustainable also also line Mobile's Lynn? iPhones all using create handheld durable larger application I'll financial the XD a case opportunities turn new manufacturing, diverse into reach In more and providers products a industrial to Employers These end solution environments, for extend new retail. We Bluetooth and will Mobile. and less feel gas introducing within new team Ultimately, to can products. scan oil base. over DuraSled more hard With of that, harsh make that and support iPhone also it partner reach a be addition workers users. for can will us our set working models construction, for this creating These on will diversified, to iPhones, airports. for on a we dependent Mobile mobile industrial our open and XX are chargers, Socket using We older of barcode scanning SDK. The extreme and our product our now for new of engineering more workers. lineup. products in results. has combine new accessories their one-handed XD is camera QX, which products develop a Lynn and current for ultra-rugged Socket markets some a same scanning details targeted been and and

Thanks, Thank call. for everyone, Dave. you, today's joining

chain the million our our prior ongoing revenue year inventory activities levels partners, disruptions. $X.X quarter. demand lead their to supply QX, to better distribution the reduced and XX% to who $X.X have among due in primarily from During This align time with million, decreased was inventory balancing by amidst down

impacted our as As sales our result, been distribution. revenue is based into a on revenue has

QX production quarter. costs margin gross This year XX.X% due and XX.X% QX, in year the engineering manufacturing primarily overhead volumes. In lower is million, were to new in across in from decrease salary was down increase XX%, increase quarter. of driven by the our the was our of the which and included Our prior XX.X% increased $X allocation hires. expenses prior the from an R&D new products This increases services expenses, new development operating

growth projects in invest to the of continue company. We critical that the long-term drive

loss XXXX, a to $X.XX per $X share $XXX,XXX share of or income had compared cash balance or the of XXXX. recorded per we net QX of end a million. QX, a QX we in $XXX,XXX By of net During $X.XX

paid During $XXX,XXX outstanding the invested in expenditures, $XXX,XXX loan quarter, we $XXX,XXX balances. and off shares XX,XXX in capital for repurchased

business we the maintain ended service. quarter supply steps of current environment. committed future million, a inventory, end inventory slight million terms proactive taking to position XXXX. $X.X in Furthermore, we In managing healthy Despite deliver the chain and to $X.X our remain ongoing increase a liquidity we from the disruptions, levels the with customer excellent are to of at effectively

up to We and Annual invite in shareholders our Our remarks. their place vote cast June will This Shareholder on prepared participate the X. Meeting all to wraps take online meeting.

for over Now questions. I'll call to operator the hand the

Instructions] Swanson an Our first [ [Operator ] Steve from investor. comes question

give the program? you Can update an us on repurchase share

a We have repurchased end at over new Currently, cost slightly don't million, shares March. we program program the expired a in the total, place. Okay. and -- company of of in XXX,XXX the $X at

At further this questions. time, have we no

in today's all Okay. you We'd just a participating call, for like and everyone afternoon. Goodbye. to good thank wish

This conference concludes Thank today's for you call. attending.