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Mark Gomes
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With over 20 years of professional experience, Mark Gomes has grown to become one of the world's most experienced technology stock analysts. He is also a Masters Track & Field world record holder and U.S. Gold medalist (http://www.fasterthanforty.com/hello-world/). Currently, Mr. Gomes is... More
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  • More HIMX Information & Product Website 2 comments
    Mar 6, 2013 3:11 PM | about stocks: HIMX

    Here's a link to HIMX's product page. Not flashy, but certainly real, functional, and modestly informative.

    http://www.himaxdisplay.com/en/product/info.asp

    Here's what I see there:

    (click to enlarge)

    On my computer, each of the Product Information links work. FYI, I'm not a technical expert, but the color sequential specifies digital, as opposed to analog.

    __________________________________________

    This post was formed as part of my response (pasted below) to Mr. Karl Guttag in my previous blog post, "Karl Guttag Weighs In On Himax And Google Glasses"

    seekingalpha.com/instablog/84364-mark-go...-glasses

    Hi Karl,

    Thanks again for lending your expertise on this subject. I think everyone can see that your motivations are purely to uncover the truth about the progression of this exciting market. In many people's eyes, my motivations are apparently more questionable! But as an American, I believe everyone is entitled to their opinion. :)

    Frankly, I believe we both just seek the truth. If HIMX is unlikely to serve GOOG's needs, I will graciously reverse my stance. I would also probably purchase shares of KOPN, since their odds of being designed into GOOG would be higher if HIMX's odds are lower. However, after doing some research on your concerns, I still believe HIMX is the most likely beneficiary.

    Here's what I've found:

    First, addressing the trouble you've encountered with their website, I've clicked around the site often. I see the "¡@" that you see, but I also see their product information. I did have some initial issues with a Firefox browser, but no issues with Explorer. I've provided a link and screenshot in an instablog post (More HIMX Information & Product Website).

    From what I've gathered, HIMX didn't give up on LCOS. It's actually a growing revenue line for them. To your point, it appears that they had to work very hard to build its transmissive and color sequential capabilities. Via their earnings calls and direct discussions with company representatives I have also gathered the following:

    • They've been working on these capabilities for several years, investing over $300 million into R&D over the past four years (imagine what could be done with a budget like that!). By comparison, KOPN's R&D spending over the same timeframe has been just over $80 million (this is not a knock on KOPN; just a reference point…I happen to like their positioning and its prospects for Golden-i)

    • They made it clear that they are not publicly disclosing all of their capabilities and/or offerings for competitive purposes.

    • They have publicly disclosed several capabilities, beyond LCOS, that fit nicely into the Google Glass vision. Here's a quote from their last earnings call -- "Also adding to this growth were our pilot shipments of LCOS microdisplays for the new and exciting head-mounted display application. Our fourth quarter non-driver businesses overall grew 27.6% year-over-year as many products experienced double-digit growth. Such products include CMOS image sensor, touch panel controller, power management IC, white LED driver, wafer level optics, IP licensing, and operational amplifiers."

    • They do have a LCOS factory (public knowledge). In fact, LCOS is the only thing they produce in-house. I have also ascertained that it was built for scalability, such that 5M units/year of capacity can be added for $25 million.

    • The company has stated that the LCOS we are discussing has an ASP in the $15-20 range, so it has to be a bit more sophisticated, since lesser components would be closer to $5 apiece. At $15 per unit, the revenue-ROI on factory expansions is four months and the margin-ROI is about 8-12 months.

    Adding that $15-20 to the ASPs on the other parts listed above, HIMX has the capability to reap well in excess of $50M of revenue from a 2 million unit order. As the market and competition expands, that 2 million / $50M can quickly move to 20 million / $500M.

    For the sake of my readers, I reiterate my stance that I don't refute any of your technical claims (to do so would be lunacy!). My background (going back to my hiring at IDC in 1994) is in working closely with industry experts (such as yourself!) and digging up key data points - pieces of a mosaic that has yet to be fully revealed to the general public :^)

    Frankly, I see plenty of room for MANY vendors to benefit. I have simply started with HIMX, due to my calculation of the odds that they are playing a part in Google Glass.

    Thanks again for gracing us with your wisdom!

    Mark G.

    p.s. Here are some additional key comments from the last HIMX earnings call:

    "there are quite a few segments which, we believe, as we move along to Q2 and second half, will pick up strongly. And they include among others CMOS image sensors, LCOS microdisplay, touch panel controller, et cetera."

    "I just also want to mention LCOS. I think starting second half hopefully, we will some exciting growth, but probably certainly much less, though, in the first half when we will still be going through engineering runs with our customer. But that is on panel display. And there are non-panel display applications that we are working along with a few leading players in the world. So we are excited about that. But again, in terms of LCOS, you won't really see meaningful volume until second half of the year."

    Unmistakably, they are working on SOMETHING that is coming out in the back half of the year… ;^)

    Disclosure: I am long HIMX.

    Stocks: HIMX
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Comments (2)
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  • Mark Gomes
    , contributor
    Comments (1910) | Send Message
     
    Author’s reply » Here's my latest information on HIMX.
    6 Mar 2013, 03:56 PM Reply Like
  • Karl Guttag
    , contributor
    Comments (37) | Send Message
     
    First, regarding the web site. Every one of those "ยก@" is a broken link to an image or other object. It has been that way for a long time. It looks like the pages have pretty much been abandoned. The Himax website started becoming "unstable" in 2009 and I downloaded some information before it when away. For your benefit, I have taken a page from today and compared it to the same page in 2009 at the link below.

     

    http://goo.gl/nJQ6h

     

    Regarding the AUP's we may be talking about two different products. The Google Glass appears to be a very low resolution image of only 320x240 (which is the resolution of the panel shown in the early prototypes) since Google Glass only fills a small corner of a person's field of view. $15 for something with that low a resolution seems like a VERY high price. Maybe Himax is talking about a panel going into a different product.

     

    [Ignoring Google Glass for the moment]: I don't know what their margins are, but they can't be huge in terms of dollars even at $15 for the panel plus other components. I would assume for this to go to high volume the prices would have to come down. If these things were selling in big numbers, you would see them everywhere (or at least in widely in Asia).

     

    [Back to Google Glass]: Certainly with $300M of invested capital, Himax could have gotten into transmissive panels, but why don't they show on their web site or elsewhere? Why keep it a sort of secret?

     

    One thing that still confuses me is why Google would use LCOS in the first place for a prototype as it would have been easier to use a transmissive panel for the type of display Google Glass appears to require. I could seen them using LCOS for a full field of view type display with higher resolution, but not for low resolution.

     

    Karl
    7 Mar 2013, 04:10 AM Reply Like
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