Akoustis Technologies, Inc. (NASDAQ:AKTS) Q2 2023 Earnings Call Transcript

Jeff Shealy: Dave, do you want to touch on that?

David Aichele: Yeah. Suji, on that, the Wi-Fi 6E actually still good, but what we’re seeing is a shift on platforms that would have been Wi-Fi 6E holding back and going into Wi-Fi 7 more on the retail side and the carrier side is still pretty robust on the 6E side. The enterprise is, they’ve launched and they’ve released their 6E products and now they’re working on Wi-Fi 7. So it’s a mix. The 6E is — there were more programs that we were targeting that are being put on hold and being shifted over to 7 because of those constraints on components and so forth. And it seems that the leaders on the side have been pretty aggressive in getting their Wi-Fi 7 chips out. So we’re enjoying all the activity across all fronts. And what we see though is a lot of transition of programs going to Tri-band.

And then actually increased amount of opportunities on quad band with either 2 by 2 MIMO or 4 by 4 MIMO. So the dollar content in the existing Wi-Fi 6E programs and particularly in Wi-Fi 7 is going up pretty significantly. As Jeff mentioned earlier also with a little bit higher ASP for these platforms as well.

Jeff Shealy: Yeah. The only other thing to add to that is, we mentioned in the script and I think it’s a good point to reiterate it. Dave talked about carrier class customers. So we’ve got — we’re expecting to ramp here in the first half with a leading carrier class customer. And we’ll see some of that this quarter, but predominantly most of that’s going to come in the second quarter of the calendar year.

Suji Desilva: Okay. Thanks, Jeff. Thanks, Dave.

Jeff Shealy: Thank you.

David Aichele: Thanks, Suji.

Operator: Our next question comes from the line of Craig Ellis with B. Riley Securities. Please proceed with your question.

Craig Ellis: Yeah. Thanks for taking the questions. And guys, it’s great to be on the call after all the years of conversation. And I’ll just echo the congratulations on the huge development with mobile over the last couple of months. So I wanted just to start on that theme. With that, module maker volume design win really targeting the China market. And this may be more of a question for Dave. Dave, how should we think about the potential for that to sample into what would typically be product releases for the big Golden Week selling season in October product that, that customer set and customer set could have around single stay and then year-end holiday and in Lunar New Year. It seems like the initial volume timing would set you up well there. Is that how you see it? And what would be the milestones leading towards those new product release windows?

David Aichele: Yeah. That’s exactly how we see it, Craig and thanks for your comments. The activity with our end customers been very active for the last year, particularly as we were getting WLP released that was a critical milestone and it also was verified in their platform as well with their reliability studies and qualifications. So we’ve been working very closely with this customer and we’ve been feeding them the amount of quantities of products that they need on earlier orders so that they can stay engaged with a handful of the reference design customers. So the activity started prior to the beginning of this new year. And the volume order that we announced in January or end of December is helping to support the development ramp with these key customers for the target, as you mentioned in the Q3 timeframe and we’re basically aligned with them on delivering the volume demand and also get line of sight to what that ramp is going to look like starting really end of Q2 and to Q3 and Q4.

So if everything is aligned with what you mentioned model wise.

Craig Ellis: That’s really helpful. The second question, I wanted to follow-up on some of the earlier inquiries on Wi-Fi 6E and do it in the following way. So if we look back to mid-January, when Apple released its new Mac offerings. One of the things that they offered on some of the platforms was 6E and our checks in Asia showed that helped really ignite a lot of interest, not just in 6E, but with the transition to 7. So you’ve been clear on all the customer engagement. I was wondering if you could just talk about the color you’re picking up from the consumer and enterprise router market over the last month or so regarding the to follow on activity that the supply chain would have in response to Apple’s announcement since they tend to be a technology trendsetter and a customer that really pushes the market to next-gen technologies.

David Aichele: Yeah. That’s a good question, Craig. From our standpoint, we are actually very well engaged with all the Tier 1 guys now. We’ve built a good reputation out in the market that’s having, leading technology, leading performance of all filters. Particularly as the systems are shifting from a dual-band to a tri-band and looking at quad band. So we have pretty good line of sight to all the platforms that are in development. And Jeff mentioned with the Wi-Fi, it’s a key carrier class service provider, ramping, utilizing the UNII-4. We see things like that. And those guys are the ones that we’re talking to now on the carrier side. We’re also in multiple platforms. We’re also talking to the enterprise guys and we’re also the retail guys.

And the carrier guys are starting to launch RFPs that are doing Wi-Fi 7 that are looking at quad band architectures. And the enterprise guys are doing our fees out for Wi-Fi 7, looking at not only quad band architectures, but also dual mode operation, where you can get up to 24 filters per system with multiple tons and so forth. So these infrastructures both in enterprise and also in retail and home, they are getting out there. So that means that the UE side is going to start adopting it. I think we’ve mentioned that we’re working with Tier 1 OEMs on non-smartphone mobile related device that would utilize Wi-Fi 7 and needs that infrastructure in place to support it. So they’re aligned fairly well. The fixed is going to be in the market ended this year, early next year for Wi-Fi 7.

And then I expect that to start some of the UE devices coming in latter half of next year maybe mid-part. That’s not fully flushed out timing wise, but that’s just some visibility we’ve got.

Craig Ellis: Got it.