Financial - Page 8

E Ink reports that their (unaudited) January 2013 revenues totaled NT$2.57 billion (almost $87 million) - a 82% increase compared to January 2012. The company says that the e-reader market segment remains strong and LCD sales "met expectations". The company's chairman says that their diversification efforts are showing traction in the areas of Mobile Phones, Wrist Watches, Electronic Shelf Labels and others.

There's a story over at The China Post regarding E Ink's Hydis plant in Korea. According to the newspaper, Hydis workers are suspecting that E Ink is stripping the company of its assets, wanting to sell its core LCD technology.

I asked E Ink about this, which gave me this statement: "Hydis is an important investment and valuable asset for E Ink Holdings. We are not selling Hydis. The technology invented by Hydis namely FFS (Fringe Field Switching) is the most popular technology adapted by mobile device makers particularly in tablets. We have been licensing our FFS technology to a number of LCD makers. FFS technology from Hydis allows LCD designs that consume less power due to better transmittance, enables high resolution displays with wide viewing angle and color gamut".

CopyTele (CTI) filed a lawsuit against E Ink Holdings, alleging an elaborate scheme to steal valuable, patented display technologies developed by CopyTele. CTI says that E Ink is infringing upon their electrophoretic display patents. CTI also filed a similar lawsuit against AU Optronics, I'm not sure what kind of technology is involved in this lawsuit.

E Ink said it expects its second half revenues to grow significantly from the first half - not just because of season factors - they expect new e-reader products in north america to re-ignite the e-reader market. E Ink also revealed that Rakuten (a Japanese e-commerce and internet company that owns Kobo) sold 100,000 e-readers in Japan since the launch last month.

E Ink plans to focus on non e-reader applications in the future to improve profitability. They expect demand for e-tags for convenience stores and supermarkets to "explode" next year.

E Ink has bought AUO's shares (82.7%) in Sipix Technology (STI) - the maker of micro?cup technology based electrophoretic e-paper displays. E Ink also intends to buy the remaining STI shares. The whole deal is worth about NT$1.5 billion (about $50 million USD) and will should close during Q4 2012.

Flexible solar Sipix prototype

Sipix's technology is pretty similar to E Ink's. It's not clear whether E Ink intends to continue producing Sipix displays or whether they bought them just for the IP and to remove a competitor. Sipix has been used in some e-readers (for example the Cybook Orizon), and apparently has some advantages over E Ink in the touch technology and refresh rate. E Ink is of course the clear e-paper e-reader leader with over 90% market share.

E Ink Holdings reported a net loss of NT$787 million (about $26.5 million) for Q1 2012 (the company's first quarterly loss in 10 quarters). The company's revenues dropped 63% from Q4 2011, and gross margins were only 0.8% (down from 28.5% in the previous quarter).

The company says that sales of e-paper products dropped and they also experienced low capacity utilization.

iSupply performed a teardown analysis on the Kindle 2011, and according to them the 6" E Ink Pearl display costs $30.5. This is the most expensive component on the Kindle - which costs $84 on the whole (BOM and assembly). This means that Amazon is actually losing $5 on each ad-supported device sold - which cost $79

E Ink Holdings reported revenue of NT$2.25 billion ($74.5 million USD) for 3Q 2011 - up 20% from 2Q. The net profit for the first nine months of 2011 was NT$5.25 billion ($173.8 million USD). The company expects the business to continue to improve in the last quarter based on strong e-reader demand.

The company's chairman says that e-readers are recession-proof - because in bad times people spend more time reading. He says that he's still optimistic that e-reader shipments will reach 25-30 million units in 2011.

3M New Ventures announced that it will invest in Pixel Qi - and this will conclude the company's Series "B" investment round. Pixel Qi says that this round will enable it to ramp up display production. Pixel Qi will also enter new markets (digital signage and touch applications). The investment amount wasn't disclosed.

E Ink Holdings says they expect e-paper shipments for e-readers to increase over 50% in 2H 2011. They now project total 2011 shipments of 25-30 million (up from 2030 million, the previous estimate).