[Royalty revenue calculations from AMTX 2Q97 Form 10-Q filed 3/17/97]
Pat,
According to the AMTX quarterly Form 10-Q report recently filed for
the quarter ended 2/1/97:
1. "Sales of the Overture series in the second quarter and six
months of fiscal 1997 were $711,000 and $951,000, respectively."
2. PC to Mainframe Connectivity Sales in 2Q97 were $199,000.
3. Royalty revenues from a product developed by AMTX for IBM
were $242,000 in 2Q97.
4. 70% of AMTX's $3,012,000 in total net 2Q97 sales [i.e.,
$2,108,400] were accounted for by sales to IBM [This means that 30%
of AMTX's total net 2Q97 sales, or $903,600, was NOT from sales to
IBM.]
The above facts are taken from AMTX's own SEC filing. Can we deduce
anything about AMTX royalty revenue from this? The amount of any DMT
licensing revenue was not itemized in the 2Q97 Form 10-Q, but perhaps
we can collectively "back-calculate" it. My own preliminary analysis
follows:
First, the only income stream disclosed by the Form 10-Q other than
"net sales" was "interest income" and "interest expense." Although I
have no accounting training, neither of those two categories would
seem appropriate for including DMT licensing revenues (if any). I
therefore conclude that IF Amati had any DMT licensing revenues in
2Q97, they must have been lumped into the "net sales" figure, because
any such income would have to be reported somewhere on the 10-Q.
Second, it seems unlikely to me that IBM would have purchased any
of the $711,000 worth of Overture series product sold by Amati in
2Q97. If this is a good assumption, then:
$903,600 in total non-IBM sales in 2Q97
- 711,000 in Overture series sales in 2Q97
________
$192,600 in total revenue received by AMTX in 2Q97 from parties
other than IBM for things other than Overture series product. If AMTX
received any DMT licensing revenues in 2Q97, such royalty amounts must
be included in this $192,600 figure.
Third, by process of elimination, if we collectively have any info
about the dollar amount of any other "sales" revenue (excluding sales
of Overture series product and excluding sales of anything to IBM), we
could sharpen the estimate of maximum possible DMT licensing revenue
received by AMTX in 2Q97. Based on the above described assumptions,
all of which seem reasonable to me, I've calculated the maximum DMT
licensing revenue received by AMTX in 2Q97 to be $192,600. Can anyone
further sharpen this analysis?
Fourth, although I have already spent many hours reading posts to
this thread, I am pretty new to SI (this is my first post) - does
maximum 2Q97 DMT licensing revenue of $192,600 seem reasonable in
light of the various announced (and hopefully existing but
unannounced) DMT-based relationships between AMTX and NEC, TI, MOT,
etc.?
Fifth, does the above analysis shed any light on whether AMTX is
cross-licensing DMT technology with MOT and others to get access to
the proprietary technology of others necessary for AMTX to market
DMT-based modems or other DMT-based products? Everybody seems to
assume that licensing of AMTX DMT technology to others automatically
means cash to AMTX. But couldn't it simply mean that AMTX gets
favorable treatment with respect to price or other terms if it buys
DMT-based chips from NEC, TI, MOT, etc., or that MOT will not sue AMTX
if AMTX sells a modem that would otherwise infringe MOT modem patents?
Have any actual TERMS of DMT licensing agreements been filed with the
SEC or otherwise disclosed in a verifiable way (as opposed to being
rumored)?
Sixth, on the bright side, note that Overture series sales
increased from $240,000 in 1Q97 to $711,000 in 2Q97. If they triple
every quarter, in a couple of years maybe I can hire somebody to
analyze SEC filings for me!
Seventh, also on the bright side, the amount of time it takes
me to read through one day's worth of posts here convinces me that
the market for high speed Internet access is likely to be monstrous!
I need an ADSL modem just to be able to keep up with this thread.
I know there are a lot of questions here for only one post, so
if anybody has info that would help answer any of them, please don't
hesitate to post it in a piecemeal fashion.
Bozo T. Clown
If you make an investment decision based on a comment by some
Bozo, you have only yourself to blame! |
