The small technology company Immersion (IMMR.US), which operates in the haptic technology market and has significant intellectual value in the form of granted patents, today shared with the market surprisingly good results for the third quarter of the year. Shares are up nearly 15%:
Revenue: $14.0 million vs. $7.2 million in Q3 2021.
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Open account Try demo Download mobile app Download mobile appRoyalty revenue: $13.9 million,vs $7.1 million in Q3 2021.
Net income: $9.4 million ($0.28 per share)
Operating expenses: $3.1 billion vs. $3.5 million in Q3 2021
Cash, cash equivalents and short-term investments: $133.5 million as of 30/09 2022
Executive Chairman, Eric Singer commented on the results: "Notwithstanding the very difficult macroeconomic environment, Immersion's financial strength has allowed for significant share repurchases (...) In addition, the Board of Directors approved a quarterly cash dividend of $0.03 per share, underscoring our confidence in the company's financial strength and commitment to returning capital to shareholders in a meaningful way. We are focused on renewing licensing agreements, protecting our intellectual property and thoughtfully allocating capital to drive long-term shareholder value."
The first quarterly dividend of $0.03 per share will be paid by the company on January 30, 2023, with the ex-date being January 15, 2023. Future quarterly dividends will be subject to further evaluation and approval by the Board of Directors in accordance with applicable law.
Despite the difficult macroeconomic backdrop, the company repurchased 954,247 treasury shares. Throughout 2022, the company has already repurchased 2,542,065 shares, at an average price of $5.20 per share. The company's current share repurchase program allows it to buy back up to $21 million worth of shares.
Recent Immersion business highlights:
- Immersion renewed a multi-year agreement with Google, under which Google obtained a license to Immersion's patent portfolio for Google and Fitbit products. Most of the terms of the agreement remained confidential. The company renewed a multi-year agreement with Japan's Nippon Seiki, under which the company obtained a license to Immersion's patent portfolio for printers, copiers and products for the automotive industry.
The company is one of the innovators of tactile feedback technology and focuses on finding, accelerating and scaling user touch interaction experiences in the mobile, automotive, electronics and gaming industries. Last year, Immersion was riding the wave of the growing popularity of the Metaverse trend. Haptic technology creates immersive and realistic experiences and provides another 'sensory bridge' between the physical and virtual worlds. Immersion is in the midst of a lawsuit against Meta Platforms (META.US), which has been accused by the company of stealing intellectual property primarily in VR technology. Immersion's track record includes litigation with Microsoft, Apple. It is working with Sony, which uses haptic technology as part of the PlayStation, among others.
Immersion (IMMR.US) stock chart, D1 interval. The company's shares opened today higher. The SMA50 and SMA200 averages, if they continue the trend, are heading for an intersection called by AT fans the so-called 'golden cross'. This formation is usually a lagging indicator of a trend reversal. Immersion, despite its small capitalization, has done better than the NASDAQ index and most technology companies this year. The stock is up nearly 5% since January 1, 2022. The company has no debt. Its Debt to Equity Ratio as of June 30, 2022 was 0. With the sale of intellectual property, the company boasts a significant net margin of more than 50%. Potentially, however, this poses some risk, making most of the company's revenue dependent on market factors and global demand for haptic technology. Source: xStation5
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