Spectra7 Announces Preliminary Record Second Quarter 2017 Revenues

Spectra7 Microsystems (TSX:SEV) has announced its preliminary selected unaudited financial results for the three month period ended June 30, 2017.
As quoted in the press release:

PRELIMINARY Q2 2017 RESULTS
The Company expects to report revenues of approximately $3.1 million¹ for the second quarter of 2017, representing an increase of approximately 15% from the prior quarter and 19% from the same quarter in 2016. Second quarter growth was driven by broad-based adoption of the Company’s patented active copper cable (“ACC”) technology. Gross margin² as a percentage of revenue is expected to be approximately 62%-64%, up from 60% in the previous quarter, driven by an improved product mix. Operating expenses for the Company, excluding non-cash items, are expected to be lower by approximately $100,000 from the prior quarter operating expenses which the Company expects to continue through 2017. As a result of the higher revenues, increased gross margin rate, and lower operating expenses, the Company’s operating losses are expected to have decreased by over 26% sequentially quarter over quarter.
CEO COMMENTARY
“Our record revenue¹ in the second quarter was driven by continued execution across our targeted markets,” said Spectra7 CEO Raouf Halim. “We are also very pleased with the expected increase to our gross margin and reduction of our operating expenditures sequentially, further improving the profitability of the Company. Initial trials of GaugeChangerPlus™, Spectra7’s ACC data center solution, have completed successfully at two Tier-one customers. Growing traction with key data center customers, leadership in the augmented, virtual and mixed reality markets, plus the closing of our recent financing put the Company in a strong position to continue our execution.”
OTHER QUARTERLY HIGHLIGHTS

• The Company successfully completed the first round technical evaluation of its GaugeChangerPlus™ solution by two Tier-one data center customers and continued strong market traction.

• The Company secured two additional industry-leading mixed reality (MR) design wins in Q2.

• Significant Tier-one MR design wins secured in Q1 are moving forward with material revenue growth expected in the second half of 2017.

• On June 27, 2017, the Company closed a bought deal offering of units for aggregate gross proceeds of CAD$4,600,000 and the first tranche of a private placement of units for additional gross proceeds of CAD$1,312,300.

• Amendments to the senior secured term loan facility with MidCap Financial (the “Loan Facility”) became effective on June 27, 2017, which amendments, among other things, (i) extend the commencement date for principal payments under the Loan Facility from June 1, 2017 to June 1, 2018, and (ii) provide the Company to extend the maturity date of the Loan Facility by one year upon satisfaction of certain conditions precedent.

Click here to read the full press release.