Kopin Corporation (KOPN) stock prices were down 6.33% as of the market closing on May 3rd 2021, bringing the price per share down to USD$7.70 at the end of the trading day. Subsequent pre-market fluctuations saw the stock fall by another 3.90%, bringing it down to USD$7.40.
Promising Financial Reports
This news came hot on the heels of the company’s announcement of their financial reports for the first quarter of 2021. Contrary to the falling stock price, the numbers reported were quite promising. The onset of the global pandemic and resulting government sanctions that rendered unprecedented numbers of people homebound saw a surge in market demand for AR and VR technologies.
KOPN capitalized on the burgeoning sector and increased customer demand, as evidenced by the company’s 48% increase in revenues for Q1 2021 as compared to Q1 2020. Major contributors of this increase in demand were the company’s defense productions and funded development programs, of which the company now has 10 of in varying stages of development. KOPN anticipates commercialization and revenue generation from these programs by the second half of 2021.
Success of R&D Efforts
The company’s existing pipeline of development programs includes the use of proprietary advanced display products that use KOPN micro-displays and increasingly utilizing the company’s cutting-edge optics system and ruggedized assemblies. This success is reflective of continued efforts in the increasing allocation of resources towards Research and Development. As KOPN continues to develop next-gen displayed and display technologies, accelerated interest in these efforts have resulted in a customer-funded R&D revenue increase of more than 80% year-over-year.
Resilience During Semiconductor Chip Shortage
The past several fiscal quarters have been marked by a shortage of semiconductor chips that has severely disrupted all sectors that make use of the short-supplied chips. KOPN fortunately managed to avoid any significant adverse effects of the shortage and continues to coordinate closely with suppliers and customers to maintain their supply chain and manage this potential issue should it arise.
Solid Liquidity Position
As of March 27th, 2021, KOPN reported cash, cash equivalents, and marketable securities of USD$35.6 million. This is a substantial increase from the USD$20.7 million reported as of December 26th, 2020, and reflects the success of the company’s ATM program. Over the course of the period ended March 27th, 2021, ACST issues 2.4 million shares under their USD$ 20 million At-The-Market program, generating USD$15.5 million in net cash as a result.
Future Outlook for KOPN
With the recent financing activities providing KOPN with a stellar liquidity position, the company is poised to leverage its resources to continue its trajectory of growth. Investors hope the recent downtrend will be corrected in favor of significant and sustained increases in shareholder value.