Brian Dobson: And as you expand beyond industrial and into automotive, do you anticipate that the margin on your product will remain roughly the same or will it vary by segment and volume? How do you contemplate that going forward?
Dan Brdar: Yes, we think it could vary significantly customer-to-customer, opportunity-to-opportunity. But what we’ve looked at in terms of our business model is really at scale getting to about 50% gross margins from product sales. And then as we look out and you talked about automotive, those automotive companies may very well want a second source. We would be potentially interested in outsourcing the manufacturing in terms of licensing to a another large semiconductor company, so that they could secure a second source that’s much larger than us. And if we have those opportunities that licensing revenue would obviously be pretty much 100% gross margin. So we could be incrementally better than 50% as we add more and more licensing to the mix.
Operator: I will now turn this call back to Jeff Christensen to read questions submitted through the webcast.
Jeff Christensen: Thank you, Kelly. Our first question for the team is, you recently now had a press release that B-TRAN outperformed the specs that you previously provided. How would you compare B-TRAN to competitors, including silicon and silicon carbide solutions?
Dan Brdar: If you look at, for example, a bidirectional switch that’s made today based on silicon devices, IGBTs and diodes. If you look for really high performance IGBTs and diodes that system may have 2.5 to 3 volts of drop, we’re 5 times better than that. We’re less than — we actually have depending on how we configure the device itself, we can be less than half of a volt, so big impact. If you look at silicon carbide, silicon carbide, the advantage silicon carbide brings is the ability to go to higher temperature and faster switching, which we’re finding is important in some applications. But if you look at the vast majority of high power semiconductor applications, silicon carbide is still just a small percentage of it.
And part of it is because of the cost of the technology, it just isn’t — there’s isn’t enough performance improvement to justify its cost. So we’re finding that we don’t see much yet in the way of new solutions for bidirectional switching. So we think we’ve got something that is really game changing in terms of the level of performance that it can bring without having to incur some of the high costs of some of the more exotic materials that people have been pursuing for quite some time now.
Jeff Christensen: And we have several questions in the queue here. And if you have a question click on the ask a question button and we’ll be happy to address it. Based on recent articles in EE Power and Electronics Weekly, it appears that likely that SymCool has distinct advantages with a high demand to it. How are you positioning the company to make sure you can manage that demand and the expectations and satisfy these big customers?
Dan Brdar: It’s part of why we’re actually in the process now of qualifying a second wafer fabricator. It’s getting a wafer fabrication process tested, validated and ready to scale up, takes quite a bit of time. It can take as long as a year easily to get through that process, which is why once we got the first one done, we didn’t just say, okay, we’re good for now. We said, well, we really need to get a second one going here, which is why we’ve pursued the arrangement with the fab in Europe. So we want to make sure that as we come into 2024, we have plenty of capacity. So we’re not trying to ramp one facility rapidly but can actually spread that out between the two facilities, it gives us the ability to manage the supply chain a little bit better, it keeps the fab from being in a sort of a crisis situation where they’re trying to ramp faster than they’re comfortable with, with a new product and allows us to make sure we’ve got a good any flow of wafers we can use for a variety of applications.
The nice thing about our technology and what we’re doing is whether the wafers are going to be used in an application like electric vehicles or solid state circuit breakers or solar or energy storage, the dies that are getting made are all exactly the same. So we actually have the ability to scale this pretty conservatively, because we don’t have to forecast where the dies are going to go, we don’t have to forecast which mix we’re going to need based on the applications and which one ramps first. So we think we’ve got a pretty robust way to ramp this up now once we get the second wafer fabricator through qualification.
Jeff Christensen: To clarify, the company did state that if you could comment on it, the company did state that they expect revenue, commercial product revenue in the back half of 2023? And also if you could talk about the ramp and the timing of that ramp, any more color on that, and the industries, markets that will be — how the markets will roll out as you expect?
Dan Brdar: So first in terms of revenue. So we will have obviously, development revenue from the Phase 2 of the program with top 10 automaker here in the fourth quarter. In terms of the SymCool fabrication, that’s in fabrication now and it’s looking like we may have devices available prior to year end for commercial sales. So we’ll have to see the exact timing on those sales. That product will be the first to ramp. Again, we’ve said given the design cycles and evaluation cycles of some of these companies, we’re looking at really modest volume for the first several months and then really ramping in the second half of 2024. So we do expect sales in the near term. But again, it will be modest in the first half and really start ramping in the second half.
And then the SymCool IQ product is roughly several months, let’s say, just to be conservative, say about six months behind in terms of expectations for that product, in terms of initial sales and also the sales ramp. So if you look at that, that’s probably more of a first half 2025 ramp for the SymCool IQ product.
