Vuzix Corp. (OTC:VUZI) Cools Down After a Strong Surge
The spectacular market performance of Vuzix Corp. (OTC:VUZI) last Friday got investors’ hopes up for yesterday. As it turned out, however, the hype failed to deliver.
Shortly after announcing that it would start sending an SDK emulator of its M100 Smart Glasses to Android developers, the company’s stock soared a whopping 52% on the subsequent session, i.e Jan. 4. VUZI also revealed to be taking part in this year’s edition of the International Consumer Electronics Show, which means that its supporters could expect a further boost upon successful performance there.
Even though VUZI enjoyed great investor interest yesterday with more than 1.3 million shares changing hands, it somehow failed to capitalize on the momentum it had gathered last week. Thus, VUZI shares closed at its Friday quote of $0.10 per share.
Focused on manufacturing video eyewear and other personal display devices, VUZI‘s proprietary iWear glasses-like products are said to be capable of providing big screen experience from small-screen portable and mobile devices. If would all be ok had it not been for the company’s financial state which can be described as controversial at best. What we have got as of Sept. 30, 2012 is:
– $170K of cash;
– $1.2M in current assets vs. $3.5M in current liabilities;
– $756K of revenue, down 40% as compared to Q3 2011;
– nine-month net profit of $1.7M vs. net loss of $2.3 million for the corresponding period in 2011;
– accumulated deficit a/o Sept. 30, 2011: $26.5 million;
– accumulated deficit a/o Sept. 30, 2012: $24.7 million, i.e a 7% improvement on an annual basis.
Judging from the figures mentioned above, VUZI seems to have found a potential business field, yet it has so far failed to turn it to its advantage. In other words, the business has yet to become profitable. The good news here is that such development is not impossible provided that the company’s products succeed in winning over new customers. The bad news is that there is no guarantee whatsoever of a positive scenario.
