Ambient Corporation (AMBT) reported strong Q3 earnings. Revenue shot up 241% to $17.0 million, from $5.0 million in the same period 2010. Shares earned $0.12, up from $0.00 in Q3 last year. However, the advances from last year are likely to level off as we move forward until the company finds more customers.
Ambient offers “nodes” that attach to transformers on an electrical grid, relaying real-time usage information to energy providers, which can then adjust distribution accordingly. The information is sent through a variety of channels such as WiFi and telephone lines; this info is conglomerated into a network which the company also provides.
Duke Energy (DUK) is still Ambient’s lone customer. To date, Duke has deployed 68,000 nodes, all in Ohio. Duke and Ambient have an agreement running through 2015. Regulatory approval for the nodes is still pending in Indiana, Kentucky and the Carolinas, limiting Duke’s deployment to Ohio. Duke has said it will spend $1 billion integrating those other states with nodes once it is approved.
Ambient’s backlog is dwindling. With $51 million in backlog as of September 30, the company can’t keep up its current sales without Duke expanding, or securing new customers. If revenues remain around $17 million per quarter, Ambient has about three quarters’ worth of shipments remaining. The company is trying to attract new customers, but it’s really more a matter of landing those new customers in case regulations prevent Duke from installing nodes outside of Ohio.
Ambient still hasn’t completed its stock offering. The company aimed to raise $50 million by releasing 7.5 million shares in October. It’s now mid-November and it still hasn’t happened. The company still has the potential to make big strides in the next 2-3 years. In the meantime, we’ll have to wait and see how Duke pans out, and whether Ambient can attract more clients.