Microvision: Hyper Growth in 2011

Rapid Development in Native [Diode] Green Laser Technology Sets PicoP™ Projector into Hyper Growth for Year 2011

In the emerging market for pico-projectors, as well as, other display techniques such as head-mounted display (HMD) or head-up display (HUD), the ideal light source would be a laser due to its capability to deliver highly saturated colors in the widest possible gamut.

Additional desirable features include focus-free operation, improvement in wall-plug efficiency─ reducing power consumption for battery operation, lower cost and high production scalability. The great advantage of laser projectors is a consistently sharp, always-in-focus, true-color, high-contrast image irrespective of the projection distance and projection surface

As we all know too well, the availability and cost of green lasers, both diode and SHG, has held back the progress in ramping-up production of laser based PicoP projectors.

However, there are three pieces of news, two from this morning and one from a year ago, that put the commercialization of laser based PicoP projectors from Microvision on steroids… for hyper growth in the year 2011.

First the old news from August 2009…

“Success in the laboratory: direct emitting green InGaN laser with 50 mW

OSRAM has set a new milestone for mobile laser projection

OSRAM Opto Semiconductors has achieved a major breakthrough in the laboratory with its direct emitting green indium-gallium-nitride laser. It already achieves an optical output of 50 mW and emits light in true green with a wavelength of 515 nm. Compared with semiconductor lasers based on current technology that operate with frequency doubling, direct emitting green lasers are more compact, offer greater temperature stability, are easier to control and have higher modulation capability.”

*****

Here’s the link to the Osram web site…

http://www.osram.com/osram_com/News/Trade_Press/LED_OptoSemiconductor/2009/090813_PM_R%26D_gruenerLaser_en.html

Over the last one year there have been several articles and white papers published indicating rapid improvement in the development of diode green lasers getting out of the lab approaching commercialization.

Today’s news from Corning confirms that…

Press Release
Source: Corning Incorporated
Monday November 1, 2010, 7:00 am EDT

CORNING, N.Y.--(BUSINESS WIRE)-- Corning Incorporated (NYSE:GLW - News) today announced its results for the third quarter of 2010.

In the press release Corning stated…

“In other matters, Corning has decided to discontinue its development and commercialization of synthetic green lasers. Given the rapid development of native green technology, the company concluded that the market for synthetic green lasers is limited.”

*****

Here’s the link to the press release…
http://finance.yahoo.com/news/Corning-Announced-bw-2268286162.html?x=0&.v=1

This piece of news further confirms that rapid progress has been made with diode green lasers. And Osram, for example, has overcome the previous limits of the InGaN material system. At the pre-development stage─ in August 2009, the company succeeded in manufacturing the first direct emitting green laser diode from the InGaN (indium-gallium-nitride) material system with a high optical output. The diode emits a “true green”, which is defined by the spectral range of 515 to 535 nm. In this range, efficient high-quality semiconductor lasers have been commercially available only as frequency-doubled versions. In the medium term, however, direct emitting green lasers could replace frequency-doubled lasers for numerous applications. They are easier to control, and also offer greater temperature stability, a smaller form factor and higher modulation capability at several 100 MHz.

Now we come to the last piece of the news that confirms the rapid development of diode green lasers… and that puts the commercialization of laser based PicoP projectors from Microvision on steroids for hyper growth in the year 2011.

Here we go…

Press Release
Source: Microvision, Inc.
Monday November 1, 2010, 7:00 am EDT

REDMOND, Wash.--(BUSINESS WIRE)-- Microvision, Inc. (NASDAQ:MVIS - News), a leader in innovative ultra-miniature projection display technology, today announced it has successfully integrated the first “direct green” laser samples from two leading manufacturers into pico projector benchtop prototypes. This achievement represents an important first step toward the commercialization of PicoP® display engines using direct green lasers. The PicoP display engine utilizing a direct green laser is expected to offer significant commercial advantages in price, size, power, and performance.

“We are very pleased with the performance of these early direct green laser prototypes,” commented Sid Madhavan, Microvision vice president, R&D and Applications. “These encouraging results give us confidence that direct green laser diodes will be capable of meeting the performance requirements for integration into our PicoP display platform.”

Simplicity leads to lower costs
Microvision’s current pico projection engine uses red and blue laser diodes and a frequency-doubled “synthetic” green laser to create a full color image. Synthetic green lasers are infrared lasers that are manipulated to reduce their wavelength to produce a green light. This conversion process creates a complex system of multiple components held to tight tolerances making manufacturing more challenging.

Direct green lasers are capable of producing green light natively, greatly simplifying laser design and manufacturing processes. Direct green lasers are expected to be manufactured in a manner similar to red and blue lasers available today, facilitating lower cost and rapid scalability to commercial quantities. The combination of smaller size, lower power, and lower cost make direct green lasers an attractive alternative to synthetic green lasers for Microvision’s mobile display solutions.

Historically, availability of synthetic green lasers has been constrained due to their complexity and the existence of only two manufacturers. Today, there are at least five companies worldwide that have announced they are developing direct green lasers for late 2011 to mid 2012 commercial introduction. Industry researcher Yole Development forecasts that the direct green laser market size will reach about $500 million by 2016 and should represent more than 45 million devices.

*****

Here’s the link to the press release…
http://finance.yahoo.com/news/Microvision-Integrates-First-bw-2659567055.html?x=0&.v=1

Some would say that this press release from Microvision is damage control in view of Corning’s decision to discontinue its development and commercialization of synthetic green lasers.

But, I disagree… because of two simple reasons:

First: Corning has decided to discontinue development and commercialization of synthetic green lasers… but that doesn’t mean they will stop production of what’s on order and contracted with Microvision.

Second: Currently, SHG green laser diodes are available on the market from Corning, Osram and QD Laser… and each have their own proprietary solutions. Now if you take Corning out of the equation… you still have two other suppliers of SHG green lasers in the interim period from now to mid 2011.

The bottom line is…

“Next year, the commercialization of laser based PicoP projectors from Microvision gets into fast lane for hyper growth in the year 2011.”

We just have to wait and see how things unfold from here?

Anant Goel

Microvision: Oppenheimer Initiates Coverage (Report Update February 8, 2010)

On December 11th, Oppenheimer initiated coverage of Microvision with a “Perform” rating and also published an analyst’s report.

Oppenheimer defines their “Perform” rating as...

“Stock expected to perform in line with S&P 500 within the next 12 – 18 months.”

Here’s the link to my two part post on the subject…
http://mirro7.blogspot.com/2009/12/microvision-oppenheimer-initiates.html

On February 8th, Oppenheimer published a ten page report update…

http://f1.grp.yahoofs.com/v1/oEaRS45DzWrf776_EvDxFdQxDCDKAxpUt-kPuLlAFvD8X4pGQvzvIwHqu5SjjCcOzoGxeJr8_SXxFGRHVugyKt7siylf/MVIS_OPP_0210.pdf

In depth reading of this report update is certainly recommended. However, here’s the summary…

EQUITY RESEARCH

COMPANY UPDATE

February 8, 2010
TECHNOLOGY/APPLIED TECHNOLOGY

Microvision, Inc.
Green Lasers Ramping Up

SUMMARY
Last Friday brought a bit of good news about the availability of green lasers, the key gating factor for the production ramp of Microvision's pico projector. The news was delivered during an Investor Day event held by Corning (GLW, $18.05, O), currently the world's only supplier of green lasers. Corning had missed a number of ramp-up targets over the course of 2009, but now appears on track and is currently producing 1K green lasers per week and still growing. As such, green laser availability should not pose a roadblock for our current MVIS volume estimates, which target 8K unit in 1Q10 and 83K units for FY10.

KEY POINTS
• Corning also noted that it is currently working on a second generation green laser, which will double its output to 20 lumens from 10 lumens. Corning does not see the quantum dot laser technology as a competitive threat, as its efficiency and brightness remain low.

• Bottom line: while we believe the value proposition of the ShowWX and the PicoP embedded module still need to prove themselves in the market, it appears component availability is set to become less of a gating factor near term.

EQUITY RESEARCH
COMPANY UPDATE

Oppenheimer

*****

 

From what I hear, we are still on track to launch SHOWwx for the US market in March of 2010.

Anant Goel
http://www.wealthbyoptions.com/

Microvision: 3rd Qtr 2009 Earnings Conference Call – Part 1

The 3rd Quarter earnings were reported after the market close and the conference call took place right after that on October 22nd, 2009.

First, let’s look at the earnings report in Part 1 of this post…
Microvision Reports Third Quarter 2009 Results

Commercial Product Launch and Beginning of Shipments of SHOWWX, World’s First Laser Pico Projector, Highlight Quarter

Press Release
Source: Microvision, Inc.
On 4:01 pm EDT, Thursday October 22, 2009

REDMOND, Wash.--(BUSINESS WIRE)--Microvision, Inc. (NASDAQ:MVIS - News), a global leader in innovative ultra-miniature projection display and image capture products for mobility applications, today reported operating and financial results for the third quarter of 2009.

Operating Results
“The third quarter of 2009 was a very rewarding and in many ways historical quarter for Microvision as we reached three important corporate milestones for commercialization of our PicoP® technology” said Alexander Tokman, Microvision’s President and CEO. “We launched our first PicoP technology based product, SHOWWXTM the world’s first laser pico projector; received our first purchase order to distribute the SHOWWX; and secured our first global OEM to private label the accessory product. We began shipping SHOWWX laser pico projectors in September and our plan is to increase volume each month to meet customer demand.”

Microvision’s Asian distribution partner, Mint Technology, through its parent company Mint Wireless Limited (ASX: MNW - News), issued a press release on October 22 (see Mint press release) revealing that the global OEM that will private label Microvision’s laser pico projector is Uniden Corporation of Japan. Microvision had previously announced on a no-name basis the purchase order from Mint Technology (see September 30 Microvision press release) and the purchase order for Uniden to private label Microvision’s PicoP display engine-based accessory laser pico projector (see October 8 Microvision press release).

Other notable results and acknowledgements for the third quarter included:

• Certifying the SHOWWX Laser Pico Projector as a Made for iPod® product

• Signing a long-term agreement with OSRAM Opto Semiconductors GmbH for supply of green and blue lasers to further strengthen supply chain capabilities.

• Receiving $1.0 million subcontract award from Lockheed Martin to support DARPA’s Urban Leader Tactical Response, Awareness & Visualization (ULTRA-Vis) program, an advanced technology development initiative to build a soldier worn system. This contract is important to Microvision’s long-term strategic roadmap, as it provides the opportunity to advance the company’s technology for a variety of military and commercial full-color eyewear applications. Under the subcontract Microvision is developing a daylight-readable, see-through, low-profile, ergonomic eyewear display based on its ultra-miniature PicoP display engine and proprietary thin, clear Substrate Guided Relay (SGR) Optics.

• Identified for the first time by the Patent Board™ as one of the "Top 50 Movers” in the Electronics and Instruments industry. The Patent Board is a leading business-based patent advisor to Fortune 500 companies, emerging technology companies, law firms, investment banks, governments and universities. The Patent Board utilizes proprietary data, tools, analytics and technology to leverage patent-based Intellectual Property as an asset class.

• Identified by a Pacific Northwest business publication as one of “Washington’s Top 100 Companies to Work For in 2009”

Financial Results

For the nine months ended September 30, 2009, the company reported revenue of $2.9 million compared to $5.1 million for the same period in 2008 and for the three months ended September 30, 2009, the company reported revenue of $ 924,000 compared to $894,000 for the same period 2008. As of September 30, 2009, the backlog totaled $2.0 million compared to $647,000 at September 30, 2008. The decrease in revenue is primarily attributed to lower backlog at the beginning of 2009, which is a result of the company's strategy to focus most of its resources on commercializing PicoP products.

Continued…

Here’s the link to the full report…
http://finance.yahoo.com/news/Microvision-Reports-Third-bw-1249636338.html?x=0&.v=1

Next, let’s review the earnings report for “Operating Results” and then we’ll focus on the “Financial Results” later…

Review: Operating Results

Microvision reached three [actually four] corporate milestones for commercialization of its PicoP display technology…

• Launched the first PicoP display technology based product SHOWwx, the world’s first laser PicoP projector.

• Received the first purchase order to distribute the SHOWwx from Mint Wireless…for distribution into the Asia-Pacific region.

• Secured the first global consumer electronics OEM [Uniden] to private label the accessory product SHOWwx...  for OEM sales and marketing into the Asia-Pacific region.

• Began shipping SHOWwx laser PicoP projectors in September and plans to increase volume each month to meet customer demand.

We are truly at the turning point in the history of Microvision, that some may call the “validation” phase. Because, that’s what the commercial release and the two purchase orders from global consumer electronic OEMs represent as …

• Validation of Microvision’s laser based PicoP display technology, its quality, its reliability, and a viable commercial fabrication & production milestone.”

• Validation of performance and quality of PicoP display engine at the core of the world’s first laser based PicoP projector SHOWwx.

• Validation of Corning's green laser technology, its reliability, and a viable commercial fabrication & production milestone.

• Validation of technical and performance superiority of laser based PicoP projector as compared to other two technologies on the market… DLP from Texas Instruments and LcoS for 3M.

• Validation of consumer preference for Microvision’s PicoP projector: wide screen, high definition, longer battery life, 2D video with fast refresh without motion blur, small physical size and always in focus images for all of video [static, streaming, and broadcast] communications.

• Validation of acceptable safety standard for laser based PicoP projectors in consumer use and adoption.

• Validation of speckle as a non-issue and as virtually non-existent with Microvision’s laser based PicoP display engine.

• Validation of fundamental design flaws of Microvision competitors: low resolution images, faded colors, short battery runs, longer throw distance, and requiring constant manual focus adjustments.

• Validation of Microvision as a product company rather than just a R&D house with 115 issued patents and with many more on file.

There is no need to create the wheel again, so here’s the link to my post on “validation” and the unfolding financial opportunity of a lifetime…

http://mirro7.blogspot.com/2009/10/microvision-opportunity-of-lifetime-in_8814.html

Microvision’s press release also confirmed the early morning news from Reuters that…

• The Asian-Pacific region distribution partner was indeed Mint Technology, through its parent company Mint Wireless Limited, and that Microvision received a purchase order from Mint Technology. Read more: http://www.mint-trading.com/default.asp

• The Asia-Pacific region global consumer electronics OEM was indeed Uniden of Japan, through the efforts of regional distributor Mint Technology, and that Microvision received a purchase order from Uniden to private label the PicoP display engine-based accessory laser pico projector. Read more: http://www.uniden.com.au/australia/oc_our_company.asp

Obviously, Microvision investors didn’t like the names in the news and the stock price plunged to $4.66 early in the morning to make the low of the day [from $5.28] and closed the day at $5.07. Then at the conference call, after the market close, Alex Tokman, CEO of Microvision, decidedly tried to dodge the questions regarding green laser supply from Corning. I don’t think the investors liked the [wishy-washy] answers on green laser supply issue either. And that, in my opinion, set the stage for further decline in MVIS stock price that came about the next day on Friday… when the stock went down further and closed the day at $4.39.

The stock price action before and after the conference call [CC] is not surprising when you consider…

• Many MVIS investors were expecting global consumer electronics firms like Sony or LG Electronics as the OEM partner of Microvision that was announced on October 8th, 2009… without naming any names at the time. Many of us and that include me, speculated on the OEM partner’s name and wrote pages to arrive at the conclusion that it could be either Sony or LG Electronics. When we finally heard the name “Uniden Corporation”, we were disappointed… because most of us are not familiar with Uniden as a household name in the US.

• Also the undisclosed name, of the Asian distributor [from October 8th press release], was finally disclosed as “Mint Technology” at the same time the OEM’s name "Uniden" became a public knowledge. Again, some of us were disappointed because we were expecting some big name global distributor… and not some company called “Mint” from Asia.

Considering the above, a first blush knee jerk action best describes the investor response to the news… about Mint Technology and Uniden Corporation… and lack of clearly understanding the comments made by Alex Tokman, on green laser supplies for 2009 and 2010.

In my humble opinion, the investor selling on the news is reactionary; essentially prompted by lack of information about the two big name companies from the Asia-Pacific region. Let’s first talk about Mint Wireless and Uniden, and then we will discuss the CEO comments on green laser supply issue. The price of MVIS stock will take care of itself when we are better informed and had some time to digest information.

Here’s the link to my post on this very topic…

http://mirro7.blogspot.com/2009/10/microvision-asia-pacific-region.html

Now let’s talk about “Other notable results and acknowledgements for the third quarter”… as stated in the press release…

• “Certifying the SHOWwx Laser Pico Projector as a Made for iPod® product”

What Alex Tokman said at the CC later in the evening, says it all…

“Many of you who don't know, our pico projector is a very simple plug and play device for people on the go who want to spontaneously view and share multimedia applications and programs such as mobile television, movies, photos, user generated content. Users can seamlessly plug the projector into their iPod devices, portable media players, and other mobile devices. Which brings me to our next topic, not every product can have “Made for iPod” logo on it. This logo indicates that our projector has specifically designed to work with iPod products. Microvision has gone through five steps process and certified that SHOWwx has been made in accordance with the high standards of quality and performance. Why is this important? According to media sources, there are more than 220 million iPods sold to-date. The preliminary feedback we have received from prospective users has been very positive. They recognize the value of the unique competitive advantages of the PicoP tech including the thin form factor high resolution infinite focus and long battery life. As an example, very recently we have completed our participation in a trade show in Japan called CEATEC where multiple companies have showcased their new projectors. Engadget reports has provided some of the coverage of what they've seen at the show. And I'm going to read you a quote from one of their take-away.

"We stopped at Microvision booth at CEATEC in order to take a look at what makes the world's first laser based pico projector so special and we can honestly say that the picture was pretty stunning."

Here’s the link engadget report…

http://www.engadget.com/2009/10/06/video-microvisions-laser-based-show-wx-pico-projector-shines-a/

Now consider the value of this marketing strategy in the short term, while the supply is constrained…

Microvision is targeting their laser PicoP projector SHOWwx into a 220 million unit strong iPod market with a certification “Made for iPod” product family [that includes iPhones]. Selling directly, or thru a distributor is lot better margin wise than it would be if Apple were to private label it under its own Apple logo.

Some day, when the supply is not constrained and millions of PicoP display engines can be mass produced to attract Apple, we may see Apple as the next global consumer electronic OEM for the American region… with a global reach

• “Signing a long-term agreement with OSRAM Opto Semiconductors GmbH for supply of green and blue lasers to further strengthen supply chain capabilities.”

Osram is coming on board with more production quantities of green laser becoming available in the fourth quarter 2009. Hopefully, that will ease-up some green laser supply issues facing Microvision at the present time. Osram green laser are better, cheaper to make and have better yields due to their simpler design as compared to Corning. Microvision has signed a multi-year supply agreement with Osram... which essentially guarantees all of Osram production of green laser going into the production of PicoP display engines.

The availability and quality of green lasers will be crucial not only to the viability of Microvision’s PicoP display technology… but also to its financial success as a growth company. In 2010, there will be six companies making green lasers for the Pico projector market. The most recent news about Japan’s QD lasers only reinforces my belief that Microvision will be a huge financial success.

Here’s the link to QD laser news…

http://www.pcworld.com/article/173455/green_laser_developed_for_microprojectors.html

• “Receiving $1.0 million subcontract award from Lockheed Martin to support DARPA’s Urban Leader Tactical Response, Awareness & Visualization (ULTRA-Vis) program, an advanced technology development initiative to build a soldier worn system. This contract is important to Microvision’s long-term strategic roadmap, as it provides the opportunity to advance the company’s technology for a variety of military and commercial full-color eyewear applications. Under the subcontract Microvision is developing a daylight-readable, see-through, low-profile, ergonomic eyewear display based on its ultra-miniature PicoP display engine and proprietary thin, clear Substrate Guided Relay (SGR) Optics.”

Contract like this not only provide current revenue, but also help fund future R&D effort to enhance, for one example, the resolution and brightness of PicoP display engine for next generation projectors.

• “Identified for the first time by the Patent Board™ as one of the "Top 50 Movers” in the Electronics and Instruments industry. The Patent Board is a leading business-based patent advisor to Fortune 500 companies, emerging technology companies, law firms, investment banks, governments and universities. The Patent Board utilizes proprietary data, tools, analytics and technology to leverage patent-based Intellectual Property as an asset class.”

Microvision is positioning itself thru patents and IP to be a major player in the image community. He (Alex) said: “Microvision is not going to be a small component provider that can be marginalized by bigger players.”

Alex sees Microvision as an INTEL type company. He is going to make the company a major player in the image industry. That may very well explain the “Image by PicoP” as the slogan chosen for the world’s first laser based PicoP projector SHOWwx.

Again, no need to create the wheel.  Please read my three part post on the subject…

http://mirro7.blogspot.com/2009/10/microvision-protect-your-intellectual.html

• “Identified by a Pacific Northwest business publication as one of “Washington’s Top 100 Companies to Work For in 2009”

Well, that’s good to know. It’s always a good sign when the company is able to hire and retain key employees during its growth phase… like Microvision is at this stage of commercial product launch.

Now let’s look at the “Financial Results”…

Review: Financial Results

“… and for the three months ended September 30, 2009, the company reported revenue of $ 924,000 compared to $894,000 for the same period 2008.”

“…, the backlog totaled $2.0 million compared to $647,000 at September 30, 2008. The decrease in revenue is primarily attributed to lower backlog at the beginning of 2009,”

Digging into the earnings report for 2nd Qtr and 3rd Qtr 2009, in simple terms, it means…

• Microvision sold lot less ROV scanners and a very few, if any, PEKs in the 3rd Qtr 2009.  And obviously, there were no sales of SHOWwx in the 3rd Qtr 2009… because POs did not show-up until October 8th, 2009.

• In 2nd Qtr 2009, the product sales were $174,000 and cost of product revenue was $543,000. In 3rd Qtr 2009, the product sales were $107,000 and cost of product revenue was $720,000. How do you reconcile the loss?  Well, I can guess, by looking at the product & development contracts backlog of approximately $2,000,000.

Here’s the analysis and the way I arrived at the numbers…

-- Total 3rd Qtr Backlog: $2,000,000
-- Estimated Development Contracts Backlog: $820,000
-- Estimated ROV Scanner Backlog: $100,000
-- SHOWwx Projectors Backlog: $0 … Purchase Orders from Asia-Pacific Region came-in on October 8th, 2009.
-- Net Product Backlog [net of ROV Scanners]: $1,080,000 [2,000,000 - 820,000 – 100,000 = 1,080,000]
-- PicoP Evaluation Kit [PEK] Sold at: $5,000 each
-- Number of PEKs Sold on Backorder: 216 … give or take a few

• “The company reported an operating loss for the nine months ended September 30, 2009 of $27.9 million compared to $25.3 million for the same period in 2008 and $9.3 million, for the quarter ended September 30, 2009 compared to $9.0 million for the same period in 2008.”

Looks like, the operating loss for the 3rd Qtr was $300,000 more as compared to the 2nd Qtr. That’s reasonable considering the commercial product launch.

• “The company reported a net loss of $30.8 million, or $0.43 per share, for the nine months ended September 30, 2009 compared to $22.7 million, or $0.38 per share for the same period in 2008 and $11.5 million, or $0.15 per share, for the quarter ended September 30, 2009 compared to $8.4 million, or $0.13 per share for the quarter ended September 30, 2008. The net loss for the three and nine months ended September 30, 2009 included a non cash loss on derivative instruments of $2.2 million and $3.0 million, respectively, compared to a gain of $585,000 and $2.0 million for the same periods in 2008. The loss on derivative instruments is due to the change in the value of the warrants to purchase the company’s common stock that were issued in connection with the company’s financing transactions.”

The net loss for the 3rd Qtr was $11.5 million as compared to $8.4 million for the 2nd Qtr. The net loss figure takes the “operating loss” of $9.3 million for the 3rd Qtr and adds [or subtracts] the gain [or loss] on derivative instruments [like options & warrants]. It’s not a real dollars loss until the derivative instrument is exercised. Consider this additional loss of $2.2 million as the “net” value of options or warrants owned [or issued] by the company. In 3rd Qtr, Microvision issued warrants to institutional investors and those warrants went up in value as the MVIS stock went up in value during that period.

• “Net cash used in operating activities was $23.4 million for the nine months ended September 30, 2009 compared to $22.3 million for the same period in 2008. Net cash used in operating activities was $7.1 million for the quarter ended September 30, 2009 compared to $7.6 million for the second quarter of 2009. The reduction in the quarterly cash burn was primarily a result of cost reduction efforts the company implemented in the first quarter of 2009. The net cash burn for the third quarter was partially offset by the receipt of $1.5 million for the exercise of investor warrants, and $300,000 for other investing and financing activities resulting in a net cash usage of $5.9 million for the third quarter of 2009. The company ended the quarter with $20.5 million in cash, cash equivalents, and investment securities.”

Here, two important things are worth noting…

• The net cash burn for the 3rd Qtr was $7.1 million and was $0.5 million less than the 2nd Qtr. However, the net cash usage in the 3rd Qtr was $5.9 million… as a result of cash received from warrants exercised and other investing and financing activities.
• At the end of 3rd Qtr, Microvision had $20.5 million in cash, cash equivalents, and investment securities.

Well, that’s about all the information I see worth looking into, in an effort to make some sense from the 3rd Qtr “Operating Results” and “Financial Results”.

Stay tuned for Part 2… where we will discuss the Earnings Conference Call and see where that takes us in this journey to “Image by PicoP” ubiquity.

Anant Goel

http://www.wealthbyoptions.com/

Microvision: Opportunity of a Lifetime… in our Lifetime (Part 1)

The cost of missing out can be greater than the cost of messing up.

“The opportunity of a lifetime must be seized in the lifetime of the opportunity.”
…Leonard Ravenhill

From time to time, during the course of our lives, we are granted the "opportunity of a lifetime.  It's a chance that doesn't come our way very often, and usually one that would result in enormous financial benefits to us… if we can manage to get hold of it before it fades away.

While it's true that certain opportunities only occur "once in a lifetime," that doesn't mean there won't be other opportunities coming our way.  However, when you look closely enough, most opportunities are literally "once in a lifetime" chances – meaning; each opportunity has its own uniqueness, benefits, life cycle and level of results. Rarely are we presented with the same exact opportunity twice in a row. They are all special and important in their own ways. Some of them are BIG opportunities that will propel us directly to our desired outcome in one great leap, while others are smaller and might move us forward just a tiny bit.

Microvision stock [NASDAQ: MVIS] is an investment that represents the opportunity of a lifetime… in our lifetime. And it is a BIG opportunity that can propel us to our financial goals in one great leap within our active lifetime… like in the next 4 to 5 years.

Here are FIVE REASONS not to let this opportunity pass you by and why you should quickly reposition your assets now…

REASON #1
The continued and almost parabolic rise from the recent lows [made in March] in stocks like Microvision [MVIS] and major indices is almost a case study as to why it pays to stay invested. For those investors who got shaken out by the almost unrelenting selling witnessed in November [last year] and in March [this year], the move up since has been equally as distressing… for those who remained short or stayed on the sidelines.

In case of Microvision, while a bounce from the lows of $0.77 cents was widely expected, the fact that it has been sustained for so long [currently trading at $5.48] is interesting. Since the beginning of March, the major indices have moved up by over 60% [and MVIS has moved up over 600%], truly showcasing the Market in its most manic state. The 600% move up in MVIS is not only due to overall improvement in the general Market, but also due to the commercial release, by Microvision, of the world’s first laser based PicoP projector SHOWwx on September 15th, 2009.

After three years of hard work, anxious wait for green lasers and sweating it each passing day, another announcement made [on 10/8/2009] of a major OEM purchase order comes as a major milestone accomplished in the history of Microvision. The stakeholders of Microvision [investors, partners and consumers] can finally take comfort in this announcement as a milestone that…

“…validates the performance and quality of our first laser projector offering. On the heels of announcing our first shipments of the SHOWwx laser pico projector, and receiving the purchase order from an international distributor, this is another significant milestone in our go-to-market strategy.” ... Alex Tokman, CEO of Microvision.

We are truly at the turning point in the history of Microvision, that some may call the “validation” phase. Because, that’s what the commercial release and the two purchase orders from global consumer electronic OEMs represent as …

• Validation of Microvision’s laser based PicoP display engine technology, its quality, its reliability, and a viable commercial fabrication & production milestone.

• Validation of performance and quality of PicoP display engine at the core of the world’s first laser based PicoP projector SHOWwx.

• Validation of Corning's green laser technology, its reliability, and a viable commercial fabrication & production milestone.

• Validation of technical and performance superiority of laser based PicoP projector as compared to other two technologies on the market… DLP from Texas Instruments and LcoS for 3M.

• Validation of consumer preference for Microvision’s PicoP projector: wide screen, high definition, longer battery life, 2D video with fast refresh without motion blur, small physical size and always in focus images for all of video [static, streaming, and broadcast] communications.

• Validation of acceptable safety standard for laser based PicoP projectors in consumer use and adoption.

• Validation of speckle as a non-issue and as virtually non-existent with Microvision’s laser based PicoP display engine.

• Validation of fundamental design flaws of Microvision competitors: low resolution images, faded colors, short battery runs, longer throw distance, and requiring constant manual focus adjustments.

• Validation of Microvision as a product company rather than just a R&D house with 115 issued patents and with many more on file.

• Validation of global consumer electronic OEMs recognizing laser based PicoP projectors as a viable and superior alternative to DLP, LcoS and FLOCS technology.

• Validation of growing demand for Pico projectors from carriers and content providers on a global basis.

• Validation of consumer demand for quality Pico projectors.

• Validation of growing demand for green lasers and the ensuing competition in green laser product arena.

We can quibble about any one of the above and despair that there are no solid numbers as yet. However, the announcement of big name [names yet to be disclosed] Global consumer electronic distributors and OEMs signing on the dotted line validates all of the above that is important to the financial viability of Microvision as a company… as well as a financial investment opportunity of a life time for us.

Some of you may argue that…

“… with the MVIS stock up more than 600% already in the last six months, may be its time for the stock to take a breather and come down a bit.”

It is possible, but I won’t count on that for the following reasons…

• Currently, there is over 10% [7.65 million shares] short interest in Microvision.  And with MVIS stock rising almost daily, the short sellers are now gritting their teeth by day and grinding them at night as nothing seems effective to prompt a sell-off.  Neither poor corporate profitability nor tempered economic forecasts have been able to do the trick. In fact, the continued move up by the market [and MVIS] has been among the most parabolic in its recorded history.

• There is an overwhelming expectation for some kind of a pullback by many market [and MVIS] participants. However, when it will occur and to what degree is still a matter of conjecture. It appears that the psychology of the market seems to be shifting. No longer does it appear that investors are looking down at the bottom. Instead, they are, it appears, to be looking up at the rays of sunlight.

• While no real indication as to which direction the market is going in the short-term, the mid to long-term thesis is that the current financial crisis is almost over and the market [and MVIS stock] will be in a better and stronger position 36 to 48 months from now. Here’s an update on he overall health of the market…

o A clear business recovery is gaining momentum.
o The sideline money is flowing back into the market—and in a big way.
o Jobless claims are declining, and the massive layoffs the press has been predicting are not materializing.
o Manufacturing is expanding and triggering a boost in consumer confidence.
o The housing market is clearly recovering, too. Just look at how the S&P’s Homebuilding Index has risen by more than 30% percent this year.
o Only 16% of the Fed stimulus money has been spent to date. When the rest of that money begins to flow, the big earnings moves we’ve seen to date will look like a drop in the bucket… as more and more companies collect their stimulus funds and report even higher earnings.

• After the release on September 15th, the world’s first PicoP projector by Microvision is gaining huge investment community interest and also some raving reviews. As the times goes on, I expect a growing world wide awareness of: Microvision name, its PicoP display technology and the financial investment opportunity it represents for many years to come. It took Intel 20 odd years to gain ubiquitous status with its famous “Intel Inside” slogan. It may take Microvision half as long with its “Image by PicoP” slogan. We just have to wait and see.

• Demand for Microvision's PicoP display engines is five times the number of green lasers that are currently available from Corning… according to Alex Tokman, CEO of Microvision, at the last conference call in May 2009. Osram is coming on board with more production quantities of green laser becoming available in the fourth quarter 2009. Hopefully, that will ease-up some green laser supply issues facing Microvision at the present time.

• Corning and Osram [the two green laser supply chain partners] are improving the production quantities, the laser light technology, performance and price on a monthly basis. The next generation of green laser [Corning GL-2000] and Microvision's high definition PicoP display engine will bear this out.

• We could hear additional OEM purchase orders on a monthly basis as more and more green lasers become available from the two supply chain partners… Corning and Osram.

The availability and quality of green lasers will be crucial not only to the viability of Microvision’s PicoP display technology… but also to its financial success as a growth company. The most recent news about green lasers only reinforces my belief that Microvision will be a huge financial success…

Japan's QD Laser has developed a compact green laser that could energize the market for high-definition micro projectors.

Martyn Williams, IDG News Service
Saturday, October 10, 2009 06:00 PM PDT

Here’s the link to the news article…
http://www.pcworld.com/article/173455/green_laser_developed_for_microprojectors.html

What’s so significant about this news is the statement…

“QD Laser is planning mass production next year and the laser should cost around US$10, said Mitsuru Sugawara, the company's president and CEO, during an interview at Ceatec. That will make it significantly cheaper than the only other competitor on the market, a micro green laser from Corning, according to Sugawara.”

The last point in support of my REASON #1 is…

“With all the validation of Microvision and its PicoP display technology that has taken place in the last one month, together with its portfolio of other products, patents and IP... if Microvision were to come to the Market today with an IPO, it could easily fetch $20 per share for a market valuation in excess of $1.5 billion dollars.

And that could still be on the low side considering…

“… that in 2003, MVIS stock traded for over $63 dollars at a time when it still had no PicoP projector… no PicoP display engine… no PicoP projector prototype… no PicoP customers … and had less than one third the portfolio of patents it has today.”

Stay tuned for REASON #2… as we move forward in our journey to explore “Microvision: Opportunity of a Lifetime… in our Lifetime”

Anant Goel
http://www.mirro7.blogpost.com/