Vuzix Corp. (VUZI) Misses Q1 EPS by 2c, Revenues Miss

May 11, 2020 7:09 AM EDT

Vuzix Corp. (NASDAQ: VUZI) reported Q1 EPS of ($0.18), $0.02 worse than the analyst estimate of ($0.16). Revenue for the quarter came in at $1.53 million versus the consensus estimate of $1.96 million.

"In our first quarter of 2020, we received initial and subsequent follow-on orders for our M400 Smart Glasses from a growing number of customers and partners involved in telemedicine, which helped drive our M-Series Smart Glasses revenue up by 43% year-over-year," said Paul Travers, President and CEO of Vuzix. "We also had demonstrable success with our Engineering Services efforts by entering into an agreement with a second major U.S. defense contractor to develop a customized waveguide-based optics engine. We continued our expense management efforts and successfully reduced our operating expenses by almost one million dollars on a comparable period over period basis as we continue our efforts to achieve profitability."

"The COVID-19 Pandemic had an impact on the day-to-day operations of many domestic and foreign businesses, including Vuzix, and despite a challenging enterprise environment, we achieved modest revenue and gross profit growth in the quarter. Vuzix advised non-production employees who could work from home that they should set-up home offices so that production employees could remain on-site assembling smart glasses over split shifts, which minimized risk to floor personnel but still allowed us to meet customer demand for our M400 and Vuzix Blade products," continued Mr. Travers.

Management Outlook

"We have made steady progress so far this year to meet our operating goals for 2020, but we have more work to do. The COVID-19 Pandemic has disrupted business operations worldwide, but it has also awakened the enterprise smart glasses industry, particularly across telemedicine, field service and remote support and manufacturing. Since mid-March, when businesses, states and countries began to shut down and work remotely across the globe due to COVID-19, Vuzix began to witness a pivoting of the enterprise smart glasses industry," said Paul Travers, President and CEO of Vuzix. "We have recently experienced increases in the average order size, number of orders and re-orders from direct customers and resellers for our M400 Smart Glasses. Thus far in our second quarter ending June 30, 2020, smart glasses revenue, along with revenues associated with recently signed Engineering Services programs expected to conclude before quarter's end, have already exceeded our 2020 first quarter revenues. We have also expanded the number of our contracted Engineering Services program engagements and are actively pursuing additional Engineering Services and OEM programs. Additionally, we continue to make great strides in our efforts to develop our next generation waveguide and display engine technologies around MicroLEDs with new strategic partners. Finally, in terms of our cash flow, Vuzix has trimmed its operating costs and will continue to be prudent in our spending while focusing on revenue generating initiatives that can maximize our cash flow from operations."

For earnings history and earnings-related data on Vuzix Corp. (VUZI) click here.

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