Socket Mobile, Inc. (NASDAQ:SCKT) Q2 2020 Earnings Conference Call - Final Transcript

Jul 30, 2020 • 05:00 pm ET

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Socket Mobile, Inc. (NASDAQ:SCKT) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Welcome to the Q2 2020 Management Conference Call. My name is Daryl, and I will be your operator for today's call.

Before we begin, I'd like to remind everyone that this conference may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1993 as amended and Section 21E of the Securities and Exchange Act of 1934 as amended. Such forward-looking statements include, but are not limited to statements regarding mobile data collection and mobile data collection products, including details on timing, distribution and market acceptance of products and statements predicting the trends, sales and market conditions and opportunities in the markets in which Socket Mobile sells its products.

Such statements involve risks and uncertainties and actual results could differ materially from the results anticipated in such forward-looking statements because of a number of factors, including, but not limited to the risk that manufacturing of Socket's products may be delayed or not rolled out as predicted due to technological market or financial factors, including the availability of product components and necessary working capital; the risk that market acceptance and sales opportunities may not happen as anticipated; the risk that Socket's application partners and current distribution channels may choose not to distribute the products or may not be successful in doing so; the risk that acceptance of Socket's products in vertical application markets may not happen as anticipated; as well as other risks described in Socket's most recent Form 10-K and 10-Q reports filed with the Securities and Exchange Commission. Socket does not undertake any obligation to update any such forward-looking statements.

[Operator Instructions] I will now turn the call over to Kevin Mills. Kevin, you may begin.

Executive
Kevin Mills

Thank you, operator. Good afternoon, everyone, and thank you for joining us today. Our Q2 revenue was $2.7 million, a decrease of 46% compared to the Q2 2019, which resulted in a loss of $768,000 for the quarter compared to a profit of $120,000 in Q2 2019. Our Q2 revenues were adversely impacted by the COVID-19 pandemic, which was anticipated. Over 70% of our business is driven by retail-centric applications, a business segment which we predicted would see more than a 40% reduction in Q2. We are not surprised by these results.

While we continue to live in extremely unpredictable times and there is a high degree of uncertainty today, we would like to share what actions we are taking to ensure we both survive the current environment and are in a position to recover as the economic situation improves. We believe our retail-related business will continue to be impacted, but that we will continue to capture a large share of the available sales. The business equivalent of racing under a caution flag will all hold our current positions, but we'll be doing so at 60 miles an hour instead of 200 miles an hour. Therefore, our focus will be on increasing our revenue in the Transportation and Logistics segment for the rest of the year.

We believe this market