Resonant Inc. (NASDAQ:RESN) Q3 2019 Earnings Conference Call - Final Transcript

Nov 05, 2019 • 04:30 pm ET


Resonant Inc. (NASDAQ:RESN) Q3 2019 Earnings Conference Call - Final Transcript


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George Holmes

progress we have made related to the three foundational pillars of Resonant, technology, tools and team, which I will touch on briefly after Marty's discussion of financials. These are the drivers of customer acquisition, revenue ramp and strategic interest in Resonant. They continue to expand our opportunity to build scale and deliver long-term value for our shareholders.

Turning to Slide 5. Now, let me dive in and give you a take on our rollout of 5G, after which I'll lay out why we believe our high-frequency technologies are uniquely positioned technically to dominate the fastest growing segment of the market. Lastly, I will spend some time reviewing our current collaboration with the dominant supplier of filters worldwide.

5G networks are being deployed aggressively worldwide. However, as with any new wireless technology, the schedule for deployment is limited in the near-term by both the availability of infrastructure and the actual implementation in the network.

Turning to Slide 6. Ericsson predicts that by 2024, 5G network coverage will reach approximately 45% using the new sub-6 gigahertz and millimeter wave technology. For true 5G wireless becomes available two implementation methodologies and progress to deliver some of the benefits of 5G using the 4G spectrum available today. First, re-forming of the 4G spectrum bands for 5G technology, which involves a software upgrade and modified requirements for components within the phone. This allows some of the advantages of 5G to be realized in the short-term. Resonant is already developing filters for these applications.

Second, because coverage for 5G will be very limited over the next two to three years, the 4G network will be required to provide a backstop for 5G coverage role. Hence 5G will initially be deployed in what is called non-stand-alone or NSA mode, so that in areas where 5G is not available, phones will drop to 4G.

Resonant's 5G strategy is to intercept this overall timetable. With new filter requirements for 4G filters re-form for 5G in 2020 and new filters using our innovative high frequency technology for 5G spectrum band. Both categories of devices will be made available through our filter IP standard library. So in layman's terms, we believe 5G is in its infancy and meaningful volume of high performance filters like those based on Resonant's XBAR technology won't be ramping until 2022.

Turning to Slide 7, high frequency technology. Resonant's high filters are designed specifically using our ISM platform to exceed the exacting requirements of 5G applications. 5G functionality is dominated by the need for bandwidth because bandwidth delivers data rates and higher data rates enable a rich user experience of 4K video streaming, virtual reality, autonomous vehicles just to name a few applications. Resonant's whole compute square, bar structures that have multiple advantages over competing bond RF structures, which were developed for different requirements of 4G. What separates Resonant's technology from the incumbent bond XBAR for suppliers is at the core of the technology. Incumbent suppliers use aluminum nitride based solution, which are limited by their ability