Precise Biometrics looks to pivot from slow sales quarter with new partnerships and projects
Precise Biometrics has reported second quarter net sales totaling SEK 13.4 million (US$1.4 million) in a quarter marked by disappointing results for the company, but also the completion of its reorganization and the formation of several new partnerships.
Earnings in Q2 were down just over 28 percent from the same period a year ago, with net operating loss falling to SEK 7.6 million ($0.8 million) from SEK 3.3 million ($340,000), and earnings per share declining from a loss of SEK 0.01 to SEK 0.02.
Precise entered a strategic partnership with Egis Technology to provide its mobile fingerprint software for in-display sensors from Egis in a deal that was announced since the quarter’s end, and another with Covr Security to offer joint products for digital identity verification leveraging Precise YOUNiQ, which was announced in June. Precise Biometrics CEO Stefan K. Persson says he expects the Egis partnership to generate around SEK 10 million ($1 million) in the second half of this year, though volatility in the mobile device market will still make 2019 a challenging year.
The secure processing module for smart cards made by Precise and NXP obtained a Mastercard CAST certificate, and the company will work on the cost structure of the product in anticipation of increasing volumes in 2020. The new Shanghai Precise office also reached full operation during the quarter.
“Another intensive quarter has passed, and it has been an eventful first half of 2019 for Precise. We continue our journey according to the strategy presented in the fall of 2018, in which we have made important progress in our three business areas; digital identity, smart cards and mobile devices,” comments Persson. “The cost savings as a result of the reorganization 2018, has resulted in a more controlled cost base during the quarter, while we continue to gradually increase the investment pace in the digital identity business area.”
Persson also notes that several pilot projects the company is running generated approximately SEK 1 million ($100,000) in revenue during the quarter. Precise hopes to launch further pilot projects this year, on the way to commercialization in 2020.
The market’s shift towards optical sensors over capacitive and ultrasonic sensors creates a market share opportunity for Precise, Persson says, though price pressure continues to effect margins.