Audio Transcript: POET Technologies operational update 2016-02-16

On 2016-02-16 POET Technologies held a conference call to give shareholders and other interested parties an operational update. This is the transcript of the call. It has been established by a community initiative of passionate POET Technologies shareholders based on the audio recording of the event.

Deutsch Zusammenfassung auf Deutsch: Am 2016-02-16 führte POET Technologies eine Audiokonferenz durch, um Aktionäre und andere Interessierte über den aktuellen Stand zu informieren. Dieses Dokument enthält die Mitschrift. Sie entstand als Gemeinschaftsinitiative passionierter POET-Technologies-Aktionäre aus der Audioaufzeichnung der Verstaltung.

Participants

Transcript

The numbers at the start of each paragraph denote the position in the audio, i.e. minutes:seconds.


Conference call (“granular update”)

00:00 – [Introduction by operator]

00:29Subhash Deshmukh: Thank you. And thank you for being with us today for the POET Technologies update on the operations. This is our second such update call and the entire POET team is extremely excited to provide this update of the significant progress we have made since our last call. With me today is Dr. Suresh Venkatesan, our CEO.

Safe harbor

00:50 – Before we begin, please let me note that during today’s call management will provide “forward-looking information” (within the meaning of the applicable Canadian securities laws) and “forward -looking statements” (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) and the company is relying on the protections of the safe-harbor created thereby.

01:13 – Many factors could affect our current expectations and could cause actual results to differ materially. The forward-looking statements and information are based on a number of assumptions and are subject to various risks and uncertainties, including those described in the company’s filings with the U.S. Securities and Exchange Commission and the applicable Canadian securities regulators, many of which are difficult to predict and generally beyond the control of the Company.

01:41 – Although the company believes that the expectations reflected in the forward-looking information or statements are reasonable, prospective investors in the company’s securities should not place undue reliance on forward-looking statements because the company can provide no assurance that such expectations will prove to be correct. Forward-looking information and statements contained in this presentation are as of the date of this conference call and webcast.

02:10 – An audio replay of this conference call can be accessed toll free in the United States and Canada at 877-660-6853 and internationally at 201-689-8031. The replay will be available starting three hours after the call and remain in effect for one week. The required conference ID number is 13628131.

02:42 – Let’s hear now from Suresh Venkatesan, CEO of POET Technologies. Suresh?

On track for commercialization

02:47Suresh Venkatesan: Thank you, Subhash. At last count we had over 87 people on this call. I want to thank everyone of you for joining us today. Thanks for your support for POET. For the beginning I want to thank our Co-Chairmen Ajit Manocha and Peter Copetti. They made significant contributions and have had a lot of engagement with this company. They continue to provide valuable insights and support to this company and are a big part of the forward progress that we are going to be reporting to you today. I also want to thank Dr. Taylor. He is our ongoing Chief Scientist to the company and we continue to chart a course forward consistent with his vision for the integrated optics platform that POET is about.

03:31 – Again, we are truly excited to be here today to provide this update to you. Four months back we were on this call, we were full of excitement and confidence of the opportunities ahead of us. In the past four months, besides being truly busy and besides it being an exciting time, we have really heightened our optimism for this company going forward. When we last convened, we noted that we embarked on this transition from a research outfit, to a commercial enterprise. In doing that, we a) analysed the state and capabilities of the POET platform, b) we had identified the target markets where POET provides us with sustained competitive differentiation and advantage, and c) we’ve established aggressive goals for this company relative to this transition of the technology from the University of Connecticut labs to more commercial and mainstream manufacturing entities.

04:30 – We also have changed our business model from being a purely IP company, to one that would demonstrate the value of this integrated opto-electronics platform, and by building components and products. We have also said that our shareholders were soon gonna be impressed by this company’s bias for results.

04:50 – We are really happy to note that POET is on track to achieve its commercialization goals. The POET operations team has made significant strides since our last update call on September 30th 2015. The foundry relationships, the development milestones, the operational improvements, that we’ve made in the interim are really placing this company on what we believe is the right trajectory going forward.

05:15 – There’s a great deal of work still to be done, but we are fully expecting to see tangible results in 2016, as we’ve previously discussed. So we are on-plan and since our September 30th update we’ve really spent a lot time establishing the basic infrastructure and capabilities in a production or manufacturing environment. We believe we are now poised to leverage this investment of not just time, but also the demonstrated proven capability to leverage that to demonstrating our key technology proof points that are ahead of us.

Energy saving potentials in data centers

05:50 – Data centers today, as we’ve discussed last time, are enduring an excruciating pain point in terms of power. There is an entity called the National Resources Defence Council and they track energy management costs of data centers particularly, and in the US alone, data centers approached almost 9 billion dollars in 2013 for energy costs and that is forecast to drive to 13.7 billion by 2020. I mean, these are big numbers.

06:25 – Each watt of heat or energy that does not have to be rejected in a data center or in a rack can be worth a lot of savings and not just direct energy costs, but also indirect energy related to cooling costs in these data centers.

06:40 – Let’s take a look at some numbers here. A single copper direct-attached cable consumes about three watts of power per end, so the total link is about six watts of power. An optical solution can effectively provide the same capability in about a watt of power. So you save about five watts of power when making that transition.

07:02 – A single mega data center has anywhere between 10,000 and 100,000 servers. So just roughly estimating that there are potentially 100,000 copper links, I mean, we are talking about half a million watts of power that you can save through a reasonable conversion of copper cables to optical cables. And that is a fairly significant savings on OPEX. So data communications, from that perspective, is really primed for what we consider to be an integrated opto-electronic device and process platform, something that can really enable low power, minimize size and minimize components costs in any solution.

07:43 – And this is really the opportunity that we laid out last time and the opportunity that POET is targeting to address with this patented process that integrates digital, high-speed analog and optical devices on the same chip. We believe that this process, appropriately incorporated in a manufacturing environment that has competitive cost structures, can enable the speed of light at the price points of copper.

Post-telecom photonics wave of growth

08:11 – Photonics currently is experiencing what we call a post-telecom wave of growth. In the early 2000’s there was a big boom in photonics. It was mostly driven by long-haul photonics which is undersea communications or long-haul telecom. But this wave of growth is fueled by consumers and that’s a big deal, that’s a big difference, these are people that use social networking, that use software as a service, cloud computing, our ubiquitous devices that we carry around with us. These are the applications that are currently driving this growth in photonics. So it is far more tangible to the layperson and it is much larger in terms of volume and sustained growth.

08:55 – So as we progress in electronics and optics, the semiconductor industry continues to heavily influence – and, by the way, be influenced by – what we do on a day in day out basis. The way we work, the way we communicate, the way we entertain ourselves. So this tangible impact of the mobility revolution, as we call it, is to view the software as a service. Software as a service manifests itself in the form of apps on a smartphone. But behind those apps apparent simplicity is the ever growing need for significant background computations and communications, and this is today carried out in the cloud.

09:33 – And so cloud computing, the social networking, mega data centers, the Internet of Things, big data, big data analytics, these are largely galvanizing this renewed growth spurt in photonics today. And investments by these Web 2.0 companies in mega data centers and all the supporting network infrastructures surrounding it, has really created a new and very dynamic segment in the optical components and modules market.

10:05 – So as we enter this next phase of significant photonic growth in the industry, the trend is towards integrated photonics. When I first joined this company, we have talked about integrated opto-electronics as the play and over my career of about 20 plus years I’ve seen integration come in various forms. Sometimes people integrate things for the sake of integrating them, but what I found with POET was a really smart way of, through new ideas and clever ways to design devices, to integrate both photonics and optics, and that is lasting in terms of its differentiation and competitiveness. So integration has always been the answer to lower cost and improved performance in the world of semiconductors, but we’re only now beginning to apply these principles to opto-electronics.

Sensing and microdisplays – striving for new optical applications

10:55 – We believe POET really holds the pole position here, in this race. From that perspective the future is very bright, ah, pardon the pun.

11:04 – To capitalize on these megatrends, we’re also working to accelerate our evaluation of an expanded product roadmap to include both displays as well as sensing technology. We have received very specific interest in these applications from prospective customers and actually are in advanced discussions to license for NRE fees and transfer our proprietary integrated Planar Opto-Electronic Technology. Included in these talks is the proposed establishment of a platform for the development of integrated sensing applications.

11:43 – Moreover, we’re also in advanced discussions with a leading institution to enter into a joint development agreement that will evaluate the adaptation of the POET platform for potential applications in microdisplays. Microdisplays are applied in this burgeoning augmented reality market where head-up displays relative to miniature projection comes into play. There the immersive displays, specifically in terms of contrast capability, is very important.

12:19 – Both of these emerging sectors represent worldwide growth markets that offer tremendous opportunity for POET. Both of these discussions are at the inception stage today. I bring them to your attention largely to highlight the excitement and interest in the market for POET.

12:37 – But getting back to our short-term targeted markets in data communications, on September 30th I have said we should expect results from the team. Today, I am very happy to report that we’re achieving them. Subhash will now walk us through the detailed operational review.

Transitioning to commercial foundries

12:55Subhash Deshmukh: Thanks, Suresh. This call, as promised, is about a more granular view of the planned rollout of POET’s highly differentiated technology platform for the next generation of opto-electronic products. So, I am very pleased to update you on the three operational priorities we set forth in the last call.

13:14 – The first priority, as we described last time, consolidating in Silicon Valley and transitioning our technology to commercial foundries. We have completed the move to Silicon Valley from Toronto and Connecticut about a full quarter ahead of schedule. We do, however, maintain a minimal presence in Toronto for regulatory reasons. At the San José site, we now have the capability to design, simulate and model devices, circuits and products. We are able to conduct electrical and optical tests on the wafers received from our foundry partners and do our first-order failure analysis and diagnostics in our lab. The first step in our lab-to-fab transition was to establish a supply of high-quality epitaxial wafers from at least one commercially viable supplier. We have successfully qualified two different epitaxial growth technologies: Molecular Beam Epitaxy or MBE and Metal Organic Chemical Vapor Deposition or MOCVD. MOCVD could be more suitable for our commercial needs, and as a result, we have signed a supply agreement with a leading provider of MOCVD epitaxial wafers.

14:28 – The next major and very significant step in our lab-to-fab transition was to complete our process technology transfer to a commercial foundry, to fabricate our devices. We had previously announced our agreement with Anadigics for early development in August 2015. Even as we started to make progress at Anadigics through the last quarter of 2015, we were faced with operational uncertainties there, and began exploring pure-play foundry alternatives. We were very pleased to sign a manufacturing services agreement with Wavetek in November.

15:04 – Wavetek Microelectronics Corporation is a pure-play III-V foundry and a wholly-owned subsidiary of UMC, which is the third largest silicon foundry in the world. Wavetek is located at UMC’s Fab 6A in the Hsinchu Science Park in Taiwan and was established as Science Park’s first six-inch gallium arsenide foundry. Wavetek, with its roots firmly in UMC, provides the experience and the capability to meet POET’s high-volume manufacturing requirements.

15:37 – Following the signing of the agreement we have been driving aggressive schedules to validate the technology transfer with real data. The transitioning of foundries has caused some initial delays in technology transfer, but we are working with our new supplier to mitigate any cascading delays to our milestones. The initial results received in the last month are very promising and reassures our belief that we can recover our schedules and meet the milestones we have previously announced.

Refining the business model

16:07 – The second priority we defined, refining our business model and charting a new go to market strategy. As we said on September 30th, we are pivoting the business model of this company from a purely licensing model to one that has its underpinnings on products, augmented with judicious licensing. Over the last several months we have undertaken several concrete steps to pursue this business model. On the product side, we have begun to build a team with the experience to launch products in our targeted markets. We’ve also progressed discussions with external parties to assist in our product launch activities. In parallel, we are in advanced discussions with highly renowned institutes for joint development agreements to develop applications in other market segments using the POET technology platform. Finally, we are also in advanced discussions for opportunistic transactions to broaden our product portfolio. Though we cannot ensure the conclusion of these discussions we believe we have made promising progress.

Leveraging the strong balance sheet

17:16 – The third priority we described, leveraging our strong balance sheet. Hitting our milestones and maintaining a strong balance sheet gives us the ability to accelerate our time-to-revenue and execute effectively when opportunities present themselves. It allows us to partner with governments, institutes and private companies to broaden our product portfolio, develop new applications and pursue other appropriate opportunities. We started 2016 with a strong balance sheet and small operational liabilities.

17:50 – We are on plan, on time and on budget and continue to expect this cash to fund several additional quarters of development and get us to revenue and positive cash flow.

More on milestones and deliverables

18:03 – Let me take a few minutes here to review the scorecard of milestones and deliverables we announced in September 2015. In Q4 of 2015 we had planned on establishing a source of commercial epitaxial wafers. This was no trivial task. This meant a jump from a single one inch (1”) wafer area at a time, to seven six inch (6”) wafers at a time, to grow a highly complicated multi-layer epitaxial structure. This required overcoming significant technical challenges, such as temperature, thickness control, doping concentrations and stress. But we got it done – on time and with highly uniform and consistent optical characteristics.

18:52 – In the fourth quarter of 2015, we had also planned on initial wafer starts to install our process technology in a foundry. Here, too, through multiple cycles of learning we developed, optimized and installed, on time, a multi-step fabrication flow utilizing the set of equipment and other processes available at the foundry. We had proposed the first demonstration of fully externally processed six inch wafers for both VCSELs and FET functionality in Q1 of 2016. We are on track to delivering this critical objective by the end of this quarter.

19:34 – We are also on track to demonstrate integrated 10 gigabit per second transmit and receive components that incorporate the FETs, VCSELs, and detectors by the second quarter of 2016. These milestones will allow us to provide functioning prototypes to the market in the second half of 2016, as per our plan. These advances are at the heart of our mission to deliver the next generation of transceivers and providing the performance of light at the cost of copper. With that I’ll turn it back to Suresh.

Questions and Answers

20:14Suresh Venkatesan: Thanks, Subhash. Again, all of us at POET thank you for your support. We will continue to update you on our progress. So let’s take some of the questions that have been posed to us. We went through all of the questions that were submitted and you’ll find that for the most part we are answering all of them today.

20:33 – But a couple of notes before we go to Q&A. We received a great many investor questions in advance of the call. We believe that we have addressed the majority of them in our remarks and we expect to cover several more in the Q&A. That will follow shortly. Security laws and regulations do preclude us from addressing subjects related to the trading and value of the stock as well as corporate finance and other topics that may be construed as non-public information. So if your question was not specifically answered please understand that legal and regulatory considerations may simply have prevented me from doing so.

21:15 – We do intend to have more of these updates in the future, with the next one around the mid-year point. Between now and then you can continue to expect updates and announcements along the way. This is as you have seen a more frequent issuance of announcements from us in the recent weeks. We realize that many shareholders would like to see a steady stream of updates from the company. Of course, business developments in various places in the world don’t follow a set schedule. But as the last few weeks have demonstrated we intend to keep our shareholders apprised just as soon as it is appropriate for us to do so.

21:54 – So let’s open it up to the questions here. We have done some condensing of course, to make sure we address as many questions as possible and several of the questions of course were also addressed in the main body of the presentation today. The way we are going to do it is I am going to recite the question and then provide you the answer to that question. I will try to categorize this in terms of the logistics or products or operations, and Subhash will actually talk to the operational questions that were posed to us.

Dropping out from the CS International Conference

22:26Question: So the first question I want to address is: Why did POET withdraw its speaking engagement from the CS International Conference?

22:34Answer: We really have regretted having to cancel the speaking engagement. This was something that was set up back in August or September of last year, soon after I joined the company, and I was excited. And I was definitely looking forward to being in Brussels in a couple of weeks. However POET is focusing on a range of initiatives right now that really are of greater priority in terms of shareholder value. So with all the things on our plate that we need to execute over the next few weeks, we decided that it would just be very, very difficult for me to attend that conference at this point in time. We are in high gear on a number of fronts. So, sorry to miss it, you know, but our other activities simply took precedence at this point in time. We do intend to schedule another trip to Europe soon, however.

New POET website coming

23:24Question: There was a question on the website, the POET website. When does POET expect to be able to provide an update on their website with video content to help investors understand the technology?

23:36Answer: You’re going to see a substantial improvement soon, in the second quarter. The site is undergoing a complete overhaul now: new design, new content, new everything. The site is being designed to be both more informative and more appealing. It is going to be sharper, better organized, and more of an authoritative reference about this company. As we embark on our public rollout, we plan to dynamically update the site on an on-going basis with clear, compelling illustrations, including video. Investors, customers, partners and other visitors are sure to have a much better understanding of POET, our products and our business. So watch this space!

The “R” question

24:19Question: The next question is financial. The question is: When does POET expect to generate revenue?

24:26Answer: So we’re still not providing revenue guidance at this stage of our development, and we have therefore not yet provided a precise timeline for this. The prospect clearly exists for POET to generate NRE or other revenue as early as this year. Generally speaking we would expect NRE or sales of engineering samples to be our initial sources of revenue. And licensing opportunities are of course expected to be in the mix as well.

Timeline for POET’s first product

24:54 – The next set of questions actually talk about POET’s product, its timelines for introduction, and they are extremely insightful questions. And so I did want to take some time to answer them in some detail. So, the first of those questions were:

25:12Question: When can we expect your first product introduction? Will we see proof points soon?

25:17Answer: As we said on September 30th, our plan is to introduce these optical engines – what we call optical engines – they are single-chip monolithically integrated optical transceivers, and for explicit applications in short reach and very short reach data communications in the form of active optical cables, or what are called AOCs. Ahead of that, we will clearly market and sell individual components, like for example the detectors, opportunistically. Not only to drive early revenue, but also to vet our solutions in the market. We believe that the POET solution could provide an immediate margin of expansion to customers using our solutions, even in otherwise low-margin or commoditized product lines, so we are extremely bullish about our market penetration here. We are all trying to complete our first devices in the current quarter. Our next quarter remains the target for basic component-level functionality. And that’s the basis, if you will, for prototypes in the second half of the year just as Subhash mentioned earlier when we talked about our on-going milestones. It remains early in our evolution at this point to precisely define and provide a roll-out for our first product. However, we do expect this to feature our unique ability to integrate optical components along with control electronics. So we’re talking about VCSEL-based, monolithic, single-chip optical transceivers.

POET’s active optical cable

26:48 Question: Another question about the active optical cable: Can you briefly explain the benefits of POET’s active optical cables and how customers would use it?

26:58 Answer: Well, that’s a great question. I want to kind of separate this into two parts:

  1. I just want to give a background for those on the phone as to what is an active optical cable itself, I mean active optical cables or AOCs, these are cables where optics are actually hidden to the user. So both ends of the cable are electrical and the electrical-to-optical and the optical-to-electrical conversions are actually hidden in the cable itself. So from that perspective an AOC is interchangeable with currently used what are called direct-attached copper cables, which of course are completely electrical on both sides. Now relative to copper any active optical cable has the advantage of dramatically lower power, size, weight, flexibility, reach, and also what we call electromagnetic interference. So the disadvantage historically and even today, with any AOC, as it relates to the direct-attached copper cables, has always been cost. The cost of an AOC is about a factor of three, if you will, more expensive than copper. So that’s always been the disadvantage.
  2. So the question then is, what is POET’s AOC and how does it compare to the standard AOCs in the market? There are four distinctions that we consider when we talk about our optical engines. With a POET AOC, the entire optical engine is integrated into a single chip on the wafer. So you don’t need to deal with multiple components and packages when dealing with a POET AOC engine. Second,the single-chip integration of all the required components enables really novel, unique, wafer-level tests and wafer-level packaging techniques to be applied and this dramatically simplifies the assembly process. The third distinguishing feature is that the POET VCSEL typically lases in single-mode and so the POET AOC could potentially use less expensive single-mode fiber in its deployment. And really the fourth distinguishing feature again comes about by this integrated capability of the POET platform. Since all the components of the POET platform are in the optical engine integrated, our cost, if you will, tend not to scale linearly with the number of channels, like a typical AOC does. So the cost benefits which we believe are already significant for a single channel, multiplies for multi-channel configurations. So those are really the four distinguishing features of the POET AOC compared to an AOC, and I also threw in the distinguishing features of an AOC relative to what is called direct-attached copper.

29:48Question: The next question is again along the lines of the product itself: Does POET expect to sell the complete active optical cable or just the transceiver chips that go into the cable? That is, will they contract manufacture out the connector?

30:04Answer: I think initially, while developing our solutions, we would be partnering on demonstrating a complete AOC and prototyping. But POET as a company does expect to focus on selling its integrated optical engines, and then we’d work with CMs, or contract manufacturers, who would attach the fibers and wrap the plastic around it.

30:27Question: Another question along the same lines: What do you see as being the biggest challenge for adoption of POET AOCs? What do you see as the biggest challenge for broad market adoption of the POET process?

30:40Answer: Of course the biggest challenge for POET at this point in it’s evolution is demonstrating the technology capabilities and mitigating technology risks. I mean, I think making progress in a startup company is all about mitigating risks, and for the most part there are three fundamental risk elements that any company faces. There’s financial risks, there’s market risks, and then there’s of course technology risks. So over the past four, five, six months, we believe that at POET, we’ve well mitigated the first two risks. So, one is the strength of our balance sheet and the second is from the significant vetting we’ve already done with key players in the market. That has allowed us to really mitigate, if you will, the financial risk and the market risk. So, today the risk of market adoption is driven more by the actual implementation of the base technology itself, demonstrating the proof points necessary over the next couple of quarters. Of course the fact that we’ve already demonstrated functional VCSELs, detectors, transistors, in the UConn labs has already mitigated some of these risks, but demonstrating commercially relevant devices in a high-volume manufacturing environment is really our next hurdle to jump.

Markets and competition

31:59Question: Another question about markets: What are POET’s market verticals plans for the next 24 months?

32:08Answer: We are driving development and growth around three verticals: Data communications – we’ve already talked to you about in quite some detail. But we’re also looking at sensing and displays. We’re actually accelerating the evaluation of our technology beyond just VCSEL-based data communications through potential partnerships and joint development programs while maintaining our operational focus on data communications.

32:37Question: Another question on competition – this is a good question! What is POET’s competition? Are there technologies that appear to compete with POET? Are there any technologies that are capable of full monolithic integration of digital, analog and photonics?

32:57Answer: Of course, there’s always competition. Like I say, if you’re trying to solve a tough problem, you’re likely not the only one trying to solve it. So, you’re working on a solution to a hard and immediate problem, there are always going to be multiple competitive solutions. That’s the way you want it to be. If you’re working on something that you’re the only person working on, then it’s probably not a problem worth solving.

33:20 – So, Silicon Photonics is one competing solution. It emerged as one of the prolific integrated photonic solutions today. It tends to have two drawbacks. One is, coupling efficiency is relatively poor in silicon. And the second is that silicon clearly does not have yet a demonstrable, viable light source. I mean, a lot of people, including people at IMEC, working on integrating indium phosphide with silicon so that you could, potentially, emit light. But those are still very, very early in the research phase. But Silicon Photonics is an integrated solution, and being on silicon, it does leverage a good cost structure and it has become a de facto standard for the medium-reach segment, if you will, of the data center market. Indium phosphide also has what they call “photonic integrated circuits”. That’s another example of an integrated solution, but they tend to be absent the electronics. So, if you take light – the generation of light, the modulation of light, the detection of light – and electronics and put them all together, POET Technologies still has the advantage. Which is why we believe it is a differentiator in the short-reach and really high-volume segments of the market where cost and form factor really are the primary considerations.

Manufacturing agreements

34:46Question: We have a question on our manufacturing agreement: Does POET anticipate further manufacturing agreements with foundries or does Wavetek have the capacity they need for the foreseeable future?

34:58Answer: So, Wavetek has both the capacity and the capability to meet POET’s manufacturing requirements. In addition, Wavetek has the ability to expand their capability to meet our future needs. However, we’re always evaluating other potential partners as our needs change. We will continue to seek opportunities to improve our operational performance through Wavetek or others, as needed.

Reach of remaining resources

35:23Question: Now there was another question. This is regarding our resources: Do we still expect to have adequate resources to achieve these milestones?

35:33Answer: Our annual expense plan and our annual expenses have not changed since last year. So, we expect that existing resources are more than adequate to deliver the first set of prototypes and achieve our stated performance metrics and objectives over the next seven quarters.

The T-RAB

35:53Question: Thanks Subhash, and so finally our last question here is about the Technology Roadmap Advisory Board, or what we call the T-RAB. The question is: Can you please discuss the T-RAB? Can you elaborate what advice has been received from the T-RAB and how it relates to POET’s roadmap?

36:12Answer: So, on March 30th, 2015, the company announced the formation of the Technology Roadmap Advisory Board. So, as stated in the company’s press release at that time, the T-RAB is acting as advisors to the Board of Directors and the executive team. Their primary focus is on optimizing and accelerating this company’s lab-to-fab transition and commercialization plan. So, by its very nature, the work that the T-RAB does is, of course, internal, it’s sensitive and extremely confidential. I mean, they are helping us set our future strategy. The company has announced its current focus and plan and some of this is in fact reflective of the work and recommendations of the T-RAB. The T-RAB is also working on a number of downstream initiatives in addition to the immediate short-term goals of the company. We cannot comment on specific contributions or work by the T-RAB or its individual members until such time as material events transpire, which necessitates public disclosure. So, premature disclosure or speculation in this regard, at this point, would not be appropriate.

37:24Subhash Deshmukh: So that completes the list of questions that we are able to cover this time. Let’s turn to Suresh for some parting words.

On plan, on the march, on target

37:32Suresh Venkatesan: Okay, thanks. So, hey, thanks again for all of you! I know it is after hours on the East Coast, and there several, I am sure over 100 now, of you that have dialled into this call and shown this kind of dedication to POET. We definitely look forward to meeting and talking with a number of you soon. But before I leave this call let me summarize the key points. Of course, all of this is subject to our usual cautionary statements and comments relative to forward looking information.

  • First: POET is on plan. We expect to demonstrate the needed device proof points from Wavetek through the rest of the quarter.
  • Second: POET is on the march. We’re marching towards our first application and our first revenue. We are in active and advanced discussions to expand the POET applications portfolio to include sensing and microdisplay technologies. We’re also in an advanced discussion for an NRE-based multi-phased technology, licensing and transfer agreement with a prospective client.
  • Third: POET is on target. Our targeted market continue to be vibrant, dynamic and high growth. We are smack-dab in the middle of this photonics growth that this industry is experiencing today. And there’s a genuine need for the kind of solution POET offers – now, and into the future. We’ve gone through detailed cost models of our technology and we really believe we can be disruptive in this space.
  • Fourth: POET is on a very big mission. More and more prospective customers and strategic partners are showing a great deal of interest. They are asking, as we are, to achieve critical proof points in a commercial environment.

And finally, one more thing: POET has a committed, insightful and growing shareholder base. I really thank all of you for that. We believe passionately that POET is roaring towards the next industry standard in some of the most extraordinary growth markets in semiconductors. We have the technology, the team and the partners to upend some of the industries high-impact markets, ranging from data communications to sensing to microdisplays. We believe it and a growing number of partners, customers and investors across the globe believe in it, too. 2016 will be a breakthrough year for this company. And with that I want to end this call and thank you so much for your participation today.


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