Schedules Conference Call and Webcast for
Thursday, September 26 at 9:00 am ET (3:00 pm
CET)
- Strategic initiatives include launch
of Quantum-Resistant Secure Chips and partnerships to establish
several OSAT Chip Design and Customization Centers.
- Despite temporary slowdown in H1 2024, SEALSQ expects
an improved performance in H2 2024 and return to growth in
2025.
- Expected growth supported by
$2.4 million investments made during H1 2024 in research and
development initiatives.
- With a strong cash position
of $18.9 million at June 30, 2024, SEALSQ is well-equipped to
weather the current slowdown and continue funding its strategic
initiatives.
- Release of engineering samples of SEALSQ’s QS7001
Quantum-Resistant Secure Chips is expected before the end of
2024.
- Robust pipeline of current
and new business opportunities valued at $71 million as of
September 20, 2024 is driven by the launch of the next generation
of semiconductors, which SEALSQ expects to release in
2025.
SEALSQ Corp (NASDAQ: LAES) ("SEALSQ" or
"Company"), a company that focuses on developing and selling
Semiconductors, PKI and Post-Quantum technology hardware and
software products, today announces its unaudited financial results
for the six month period ending June 30, 2024 (H1 2024) and
provides updates on strategic business initiatives highlighting its
continued commitment to innovation, including the launch of
quantum-resistant secure chips set to position the Company for
future growth in the cybersecurity industry.
H1 2024 FINANCIAL AND OPERATIONAL
HIGHLIGHTS
As anticipated, 2024 has been a transitional
year for SEALSQ. Revenue for H1 2024 was $4.8 million, reflecting
the expected slowdown in traditional semiconductor demand, mainly
due to two key factors: excess component inventories post-capacity
shortage at legacy customers and a decrease in orders for legacy
products from large customers as they await ordering availability
for next-generation chips.
Despite this temporary downturn, SEALSQ expects
improved financial and operational performance in H2 2024, subject
to the finalization of previously announced projects and
partnerships, and a return to growth in 2025. Of note, the
Company’s robust pipeline of current and new business opportunities
valued at $71 million as of September 20, 2024, is driven by the
launch of the next generation of semiconductors, which SEALSQ
expects to release in 2025 and with the first revenues anticipated
in 2026.
Carlos Moreira, CEO of SEALSQ noted, “During the
first half of the year, we took several steps to bolster our
position in the markets we operate on a global scale. We invested
$2.4 million in research and development initiatives, expanded our
US-based sales team, made significant progress towards the
establishment of several OSAT cybersecurity chip design and
customization centers, secured global partnerships, and made
advancements in the development of our post-quantum chips.
Representative of this progress, we are now preparing to release
engineering samples of our QS7001 Quantum-Resistant Secure Chips
before the end of the year. With a strong cash position of $18.9
million at June 30, 2024, SEALSQ is well-equipped to weather the
current slowdown and continue funding our strategic
initiatives.”
Expectations are supported by several key growth
factors including the expansion of Matter certification, global
adoption of new IoT security standards such as the US Cyber Trust
Mark or the EU Cyber Resilience Act, and SEALSQ’s strong value
proposition on the PKI market for both IoT device makers segment
and GSMA eUICC manufacturers and service providers. This has been
reflected by new agreements signed in H1 2024, both with existing
clients in the healthcare industry in the US and new customers in
Asia (D-Link, HOSIDEN) and Europe (In Lite), mostly around smart
home applications.
PROGRESS ON STRATEGIC
INITIATIVES
Launch of Quantum-Resistant Secure
ChipsSEALSQ remains on track to launch its range of
Quantum-Resistant Secure Chips, including the QS7001 and QVault
TPM, by Q4 2024. Engineering samples of the QS7001 are expected to
be available for order by Q4 2024, with the TPM version ready by
year-end. These chips are built on a RISC-V Quantum Resistant and
CCEAL5+ hardware platform, designed for Kyber and Dilithium
quantum-resistant algorithms. The QS7001 will allow customers to
develop their own firmware, while the QVault TPM will feature a
pre-provisioned, FIPS 140-3 and TCG-certified Trusted Platform
Module stack.
Strategic Partnerships and Custom
SolutionsSEALSQ is actively pursuing strategic
partnerships with major electronics manufacturers to develop custom
quantum-resistant chips based on the QS7001. These partnerships are
key to SEALSQ’s broader industrial strategy and are expected to
create new business opportunities and revenue streams. The
Company’s efforts to establish Semiconductor Design and
Personalization Centers will further support its customization
activities.
In parallel, SEALSQ is developing a channel
strategy by partnering with module and electronic board designers
and manufacturers, like Hosiden in Japan and Bharat Pi in India.
These companies have integrated SEALSQ VaultIC Secure Element into
their semi-finished electronic products used by IoT device
manufacturers to build consumer products like smart home appliances
compatible with Matter standard. Each of these partnerships is
expected to significantly contribute to generating new
opportunities and accelerating growth in the coming months.
Global Expansion and OSAT
DevelopmentsSEALSQ is in final negotiations with the
Spanish government to establish a Semiconductor Design and
Personalization Center in Murcia. This collaboration supports
Spain's Strategic Project for Economic Recovery and Transformation
of Microelectronics and Semiconductors (PERTE Chip), which aims to
mobilize €12.25 billion by 2027.
In the United States, SEALSQ has incorporated
SEALSQ USA Ltd as part of its plan to develop an Outsourced
Semiconductor Assembly and Test (OSAT) facility. This facility
would offer advanced testing and assembly services and would focus
on post-quantum cryptography and artificial intelligence. SEALSQ is
also exploring funding opportunities under government incentive
schemes, including those provided by the US CHIPS Act of 2022.
Additionally, SEALSQ is in negotiations for two
significant projects in the Middle East and Far East to establish
Semiconductor Personalization Centers through Public-Private
Partnerships (PPP).
Root Certificate Authority Approval and
PKI ServicesBy leveraging the WISeKey Root Certificate
Authority, which attained GSMA Root CI accreditation in Q1 2024,
SEALSQ PKI can now enable eUICC and Subscription Management
entities to identify and authenticate within the GSMA remote
provisioning Consumer ecosystem, facilitating security and
interoperability.
Of note, in 2023, SEALSQ’s Root Certificate
Authority was approved by the CSA for Matter device attestation,
positioning the Company as a Product Attestation Authority (PAA).
SEALSQ offers Device Attestation Certificates (DACs) through its
INeS managed “PKI as a Service” platform, enabling businesses to
authenticate devices without investing in costly hardware
infrastructure.
BALANCE SHEET HIGHLIGHTS
The balance sheet reflects a strong cash
position of $18.9 million at June 30, 2024, enabling the Company to
continue funding its operations for the foreseeable future. This
strengthened cash position, up $12 million since December 31, 2023,
is largely a result of $20 million of additional funds raised
through Share Purchase Agreements (the “Agreements”) structured via
three tranches, signed with a group of institutional investors (the
“Investors”). The Company’s strong cash position also enabled it to
pay down some of its debts to related parties leading to an overall
$3.6 million reduction in debts to related parties.
As of June 30, 2024, through conversions into
Ordinary Shares, the first tranche was fully repaid , while the
second tranche was almost 90% repaid; subsequently, the remaining
balance of the second tranche has now been fully repaid. The only
balance remaining outstanding is that relating to the third
tranche. Since the first and second tranches have been fully
repaid, the Company intends to take action to deregister the
remaining unsold securities on the Registration Statements on Form
F-1 related to those tranches (Reg. Nos. 333- 273793 and
333-276877). Upon such deregistrations, the only resale
registration statement remaining in effect would be relating to the
third tranche (Reg. No. 333-278685).
The Company’s balance sheet is now in a much
stronger position as a result of the reduction in the Company’s net
debt position when considering the cash and cash equivalents held,
offset by the Convertible Note liabilities and Indebtedness towards
Related Parties.
The Company does note that the current price of
its Ordinary Shares means that any conversions made by the
Investors related to the outstanding balance of the third tranche,
as per the terms and conditions of the Agreements, would be below
the floor price. The Agreements set the floor price at $0.55 whilst
stating that the floor price can be adjusted upon a mutual
agreement between the Company and the Investors. Whilst the Company
has not formally amended the floor price, it has done so
previously, and the Company considers it would be inclined to agree
to a reduction in the floor price should one be requested. Based
upon the terms of the Agreements, the Company has calculated that
the total number of shares registered under the third tranche
registration statement would still exceed the number of shares
likely to be issued if the entire remaining balance were to be
converted today.
MOVING FORWARD
Market Outlook and Growth
ProjectionsSEALSQ is well-positioned to capitalize on
evolving cybersecurity requirements globally. The Company expects
its post-quantum chips to play a crucial role in securing IoT
devices, smart homes, autonomous vehicles, and industrial
applications in the future.
Key growth areas for SEALSQ over the
next five years include:
- VaultIC chip sales
to Consumer IoT, Smart Grid and Automotive Charging device makers
and operators.
- PKI and RoT
Services: Recurring revenue is expected from device
attestation and certificate lifecycle management services as well
as from the GSMA eUICC manufacturers and service providers.
- Quantum-Resistant
Semiconductor Sales: SEALSQ anticipates significant sales
growth starting in 2025 as new chips enter full production.
- ASICS & custom
solutions: Strategic partnerships for custom
quantum-resistant chips will generate revenue through development
contracts and licensing fees.
SEALSQ’s continued focus on innovation and
security ensures it remains a leader in the cybersecurity and
semiconductor industries, driving long-term growth and value for
shareholders.
CONFERENCE CALL
The company will host a conference call to
review its results on Thursday, September 26, at 9:00 am ET (3:00
pm CET). If you wish to join the conference call, please use the
dial-in information below:
- Toll-Free Dial-In Number:
877-445-9755
- International Dial-In Number:
201-493-6744
A simultaneous webcast of the call may be
accessed online via the Investors section of the company’s website,
https://www.sealsq.com/investors/events. The archived call will
also be available on the Investors section of the company's
website, https://www.sealsq.com/investors/events.
FILING OF HALF YEAR REPORT ON FORM
6-KSEALSQ filed its Condensed Consolidated Financial
Statements in the Form 6-K for the six-month period ended June 30,
2024, with the U.S. Securities and Exchange Commission on September
25, 2024. The Form 6-K can be accessed by visiting the Company’s
website at www.sealsq.com.
In addition, the Company's stockholders may
receive a hard copy of the Form 6-K, which includes complete
unaudited financial statements, free of charge by contacting its
Investor Relations Representative at lcati@equityny.com or +1 212
836-9611.
ADDITIONAL FINANCIAL & OPERATIONAL DATA
Consolidated Statements of Comprehensive Income/(Loss)
[as reported]
| |
Unaudited 6 months ended June 30, |
|
USD'000, except earnings per share |
2024 |
|
|
2023 |
|
| |
|
|
|
| Net sales |
4,828 |
|
|
14,751 |
|
| Cost of sales |
(3,667 |
) |
|
(6,760 |
) |
| Depreciation of production
assets |
(228 |
) |
|
(201 |
) |
| Gross
profit |
933 |
|
|
7,790 |
|
| |
|
|
|
| Other operating income |
- |
|
|
9 |
|
| Research & development
expenses |
(2,393 |
) |
|
(1,492 |
) |
| Selling & marketing
expenses |
(2,653 |
) |
|
(2,441 |
) |
| General & administrative
expenses |
(4,777 |
) |
|
(4,145 |
) |
| Total operating
expenses |
(9,823 |
) |
|
(8,069 |
) |
| Operating
loss |
(8,890 |
) |
|
(279 |
) |
| |
|
|
|
| Non-operating income |
465 |
|
|
180 |
|
| Gain / (loss) on debt
extinguishment |
(100 |
) |
|
- |
|
| Interest and amortization of
debt discount |
(557 |
) |
|
(143 |
) |
| Non-operating expenses |
(372 |
) |
|
(313 |
) |
| Loss before income tax
expense |
(9,454 |
) |
|
(555 |
) |
| |
|
|
|
| Income tax (expense) /
income |
(1,304 |
) |
|
(320 |
) |
| Net loss |
(10,758 |
) |
|
(875 |
) |
| |
|
|
|
| Earnings per ordinary
share (USD) |
|
|
|
| Basic |
(0.37 |
) |
|
(0.06 |
) |
| Diluted |
(0.37 |
) |
|
(0.06 |
) |
| |
|
|
|
| Earnings per F share
(USD) |
|
|
|
| Basic |
(1.87 |
) |
|
(0.29 |
) |
| Diluted |
(1.87 |
) |
|
(0.29 |
) |
| |
|
|
|
| Other comprehensive
income / (loss), net of tax: |
|
|
|
| Foreign currency translation
adjustments |
(8 |
) |
|
(4 |
) |
| Other comprehensive
loss |
(8 |
) |
|
(4 |
) |
| Comprehensive
loss |
(10,766 |
) |
|
(879 |
) |
The notes are an integral part of our consolidated financial
statements.
Consolidated Balance Sheets [as reported]
| |
As at June 30, |
|
As at December 31, |
|
USD'000, except par value |
2024 (unaudited) |
|
2023 (unaudited) |
| ASSETS |
|
|
|
| Current
assets |
|
|
|
| Cash and cash equivalents |
18,858 |
|
6,895 |
| Accounts receivable, net of
allowance for credit losses |
1,565 |
|
5,053 |
| Inventories |
2,772 |
|
5,231 |
| Prepaid expenses |
471 |
|
605 |
| Government assistance |
1,826 |
|
1,718 |
| Other current assets |
625 |
|
765 |
| Total current
assets |
26,117 |
|
20,267 |
| |
|
|
|
| Noncurrent
assets |
|
|
|
| Deferred income tax
assets |
1,775 |
|
3,077 |
| Deferred tax credits |
63 |
|
- |
| Property, plant and equipment,
net of accumulated depreciation |
3,013 |
|
3,230 |
| Intangible assets, net of
accumulated amortization |
- |
|
- |
| Operating lease right-of-use
assets |
1,181 |
|
1,278 |
| Other noncurrent assets |
85 |
|
83 |
| Total noncurrent
assets |
6,117 |
|
7,668 |
| TOTAL
ASSETS |
32,234 |
|
27,935 |
| |
|
|
|
|
LIABILITIES |
|
|
|
| Current
Liabilities |
|
|
|
| Accounts payable |
6,904 |
|
6,963 |
| Indebtedness to related
parties, current |
- |
|
1,278 |
| Deferred revenue, current |
2 |
|
- |
| Current portion of obligations
under operating lease liabilities |
355 |
|
336 |
| Income tax payable |
- |
|
2 |
| Other current liabilities |
34 |
|
138 |
| Total current
liabilities |
7,295 |
|
8,717 |
| |
|
|
|
| Noncurrent
liabilities |
|
|
|
| Bonds, mortgages and other
long-term debt |
1,734 |
|
1,654 |
| Convertible note payable,
noncurrent |
9,313 |
|
1,519 |
| Indebtedness to related
parties, noncurrent |
7,478 |
|
9,695 |
| Operating lease liabilities,
noncurrent |
754 |
|
893 |
| Employee benefit plan
obligation |
436 |
|
426 |
| Total noncurrent
liabilities |
19,715 |
|
14,187 |
| TOTAL
LIABILITIES |
27,010 |
|
22,904 |
| Commitments and
contingent liabilities |
|
|
|
| |
|
|
|
| SHAREHOLDERS'
EQUITY |
|
|
|
| Common stock - Ordinary
Shares |
227 |
|
|
154 |
|
| Par value - USD 0.01 |
|
|
|
| Authorized - 200,000,000 and
200,000,000 |
|
|
|
| Issued and outstanding -
22,734,630 and 15,446,807 |
|
|
|
| Common stock - F Shares |
75 |
|
|
75 |
|
| Par value - USD 0.05 |
|
|
|
| Authorized - 10,000,000 and
10,000,000 |
|
|
|
| Issued and outstanding -
1,499,700 and 1,499,700 |
|
|
|
| Additional paid-in
capital |
35,616 |
|
|
24,730 |
|
| Accumulated other
comprehensive income / (loss) |
776 |
|
|
784 |
|
| Accumulated deficit |
(31,470 |
) |
|
(20,712 |
) |
| Total shareholders'
equity |
5,224 |
|
|
5,031 |
|
| TOTAL LIABILITIES AND
EQUITY |
32,234 |
|
|
27,935 |
|
The notes are an integral part of our consolidated financial
statements.
About SEALSQ
SEALSQ focuses on selling integrated solutions
based on Semiconductors, PKI and Provisioning services, while
developing Post-Quantum technology hardware and software products.
Our solutions can be used in a variety of applications, from
Multi-Factor Authentication tokens, Smart Energy, Smart Home
Appliances, Medical and Healthcare and IT Network Infrastructure,
to Automotive, Industrial Automation and Control Systems.
Post-Quantum Cryptography (PQC) refers to
cryptographic methods that are secure against an attack by a
quantum computer. As quantum computers become more powerful, they
may be able to break many of the cryptographic methods that are
currently used to protect sensitive information, such as RSA and
Elliptic Curve Cryptography (ECC). PQC aims to develop new
cryptographic methods that are secure against quantum attacks. For
more information, please visit www.sealsq.com.
Forward-Looking StatementsThis
communication expressly or implicitly contains certain
forward-looking statements concerning SEALSQ Corp and its
businesses. Forward-looking statements include statements regarding
our business strategy, financial performance, results of
operations, market data, events or developments that we expect or
anticipates will occur in the future, as well as any other
statements which are not historical facts. Although we believe that
the expectations reflected in such forward-looking statements are
reasonable, no assurance can be given that such expectations will
prove to have been correct. These statements involve known and
unknown risks and are based upon a number of assumptions and
estimates which are inherently subject to significant uncertainties
and contingencies, many of which are beyond our control. Actual
results may differ materially from those expressed or implied by
such forward-looking statements. Important factors that, in our
view, could cause actual results to differ materially from those
discussed in the forward-looking statements include the expected
success of our technology strategy and solutions for IoMT Security
for Medical and Healthcare sectors, SEALSQ's ability to implement
its growth strategies, SEALSQ's ability to continue beneficial
transactions with material parties, including a limited number of
significant customers; market demand and semiconductor industry
conditions; and the risks discussed in SEALSQ's filings with the
SEC. Risks and uncertainties are further described in reports filed
by SEALSQ with the SEC.
SEALSQ Corp is providing this communication as
of this date and does not undertake to update any forward-looking
statements contained herein as a result of new information, future
events or otherwise.
Press and Investor Contacts
| SEALSQ Corp.Carlos
MoreiraChairman & CEOTel: +41 22 594 3000info@sealsq.com |
SEALSQ Investor Relations (US)The
Equity Group Inc.Lena CatiTel: +1 212 836-9611 /
lcati@equityny.comKatie MurphyTel: +212 836-9612 /
kmurphy@equityny.com |
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