Datavault AI Inc.

and welcome to the WISA Technologies third quarter 2023 results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. And now I would like to turn the conference over to David Barnard from LHA Investor Relations. Please go ahead.

Thanks, Marlise. As a reminder, this is the third quarter results conference call for WISO Technologies. With us today is Brett Moyer, CEO and President. Before turning the call over to Brett, I'd like to remind everyone that today's conference call will include forward-looking statements, which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. Any such forward-looking statements should be considered in conjunction with the cautionary statements in our earnings release and risk factors discussed in our filings with the SEC. WISA assumes no obligation to update any of these forward-looking statements except as required by law. With that, I'll turn the call over to Brett. Please go ahead, Brett.

Thank you, David, and thank you, ladies and gentlemen, for joining the call today. Today we will not be going over the financials we filed the queue last night. If you have questions on financials, I'll take those during the Q&A. You know, 60 days ago at the end of July, 90 days ago at the end of July, we launched the WISA-E module, which is a major four-year milestone for the company. So what we're going to focus on today is what happened in the next 90 days. So what did we do in July or August, September, October? And I think you'll find that we really had tremendous success in the launch and getting this product out into the market. So we'll just go through two quick slides if there's new people listening to the webcast. You know, WISA is about wireless audio, spatial audio. If you look at what the Dolby and Xperia DTS are doing, they're trying to bring in elevated audio as well as front, back, rear, side audio, traditionally the home theater stuff. So WISA's role in it is to make sure that we can get whatever audio is being decoded by the TV or the AV receiver or a smart device to the speakers, all the speakers, make sure they're in sync with the video and in sync with each other so you have a truly immersive, flawless, wireless audio. The other role WISA does is we have a WISA association, which is designed to make sure that When a product says WISA or WISA-E on it, the market knows, the consumer knows that that product will work with any others, that it's interoperable. And we think that's a very important thing. It's important to the speaker companies. It's important to all the audio companies as well as if you're a smart device, a phone or a TV, you want to know that the consumer has options to listen to the content on your smart device and it works with multiple brands. So that's the crux of it. Historically, we've had really premium audio brands designing and shipping our products. But today, let's talk about WISA-E. So we had launched WISA with custom chips, a lot of IP, took us a while to develop. But as we've talked about in the last several years, our goal was to get to a software-based technology that can be loaded onto low-cost Wi-Fi chips, whether they're 2.4 gigahertz, 5 gigahertz, can be loaded onto smart devices without additional hardware. And with that launch at the end of July, we now have a full suite of WISA-E products to go out and talk to customers about. We have the DS module, which is on the expressive IoT module that handles up to four. channels, and we'll talk about a sound bar that launched with that last week. We have the WISA-E modules, which is what we sampled at the end of July, and that includes the software that can be also loaded into a smart device directly to transmit to speakers. So let's talk about the sound bar that was launched last week. It was previously announced that we started shipping customers. It is the Platinum Audio 5.1.4 Milan soundbar. We have talked for 18 months now that one of the great things about DS is it can handle five audio channels, and it can give you the ability to have Atmos speakers at a very low cost in the rear of the room. So you've got left rear, you've got audio coming from the left side, from the right side, and audio going upwards. above you hitting the ceiling and coming back down to give you that truly immersive sound. So when you look at the Milan 5.1.4, you got two rear speakers that are also two ceiling speakers, and you have a sound bar that's adding two up-firing speakers. So there's really four speakers sending audio to the ceiling. There's a total of 10 speakers or six going directly at ear level where you're sitting. So the combination creates a truly immersive sound. Now, if you go out and look at some of your tier one audio companies, Samsung, LG, the soundbar guys, Clips, you'll see these type of products selling at $1,200, $1,800. This product is being launched at an MSRP at $799. It has a launch promo at $699 right now. And for anybody listening to this call or reading the press release today, you have 48 hours to go to platinaudio.us and enter promo code YCE to test this audio system out. So we think it's a great demo for investors to understand YCE and how does it work, what's the quality of the audio that's being wirelessly transmitted. We think it's a great audio product, and we're offering that 48-hour opportunity for people to test it. But you have to go to platinaudio.us and enter YCE for the promo code. So a month ago, give or take, we announced a licensing, a free license from the associations to any members, to TV and display members. So that's TVs and projectors. We thought that was an exciting idea. We have spent the last four weeks presenting to TV guys. We'll go through some of the stats. But why did we do that? TVs are extremely sensitive to their bill of material cost. It's a highly competitive market. And by offering the transmit software to TVs for free, it creates a lot of use cases for them. It doesn't matter whether it's a low-end TV, a high-end TV, a gaming TV, or a projector. They all have less audio than what most consumers desire. So by having a free... Free YCE embedded software to transmit to speakers, it opens up a lot of use cases. So it can go, the TV could go straight to the soundbar. That would eliminate all the HDMI cables. Or it can go another level, and since the TV decodes audio and the soundbar decodes audio, you have the ability to go directly to the soundbar or speakers and eliminate the cost of decoding and the electronics in the soundbar. We think that could drop $25 to $50 off of the retail price of low-end sound bars. Some of what the response we got are TVs, particularly this is true in the China brands, is they'd like to just simply get a left and a right stereo speakers around their TV with a subwoofer to get that better sound but at a low cost. So that's a great use case. Headphones, you know, for elderly people that have a hard time hearing, For gamers that don't want to wake up the whole house, there's no reason the TV can't use YCE to stream directly to headphones designed with YCE. Or more sophisticated TVs, which if you look hard, you'll see them in the UK, but a lot of the TV companies are looking at it, of adding speakers in the top of the TV as well as the bottom of the TV, which is where they are today, traditionally. So the Atmos is coming out of the front of the room to the ceiling from the TV directly. And if you have YCE, then you could add Atmos speakers, just like that sound bar we walked through, and subwoofers for the back of the room. Or you can make combinations any way you want. So we thought a month ago, by offering this opportunity, it would give the TV guys a great opportunity to start thinking about different design applications that serve the customer better. So why WISA-E? There's other not as dominant or not as sophisticated technologies. Well, as we talked about, the program we now are offering is a zero cost to bottom, right? We have the high audio channel counts that we can support Dolby Atmos. We have interoperability between brands. We have a speaker ecosystem. And would maybe not be completely transparent to the average investor, Most TVs have two or three SOCs that they use to cover their whole product line. So one of the advantages that YCE has is you can implement it at your low end, at your mid-range, or your high end, and whatever audio products, whether they're soundbars, speakers, subwoofers, you design, it'll work across all your TV line. And finally, as we talked about, we think YCE creates the opportunity to lower prices on audio products by eliminating the duplication of audios in soundbars and TVs. So what's gone on since we launched at the end of July? We've had more than 60 meeting presentation demos across 30 companies. So frequently this means we've gone back two or three times to some of the bigger companies to make sure the audio divisions, the TV divisions, technology approval people are all going through and reviewing WISA-E or testing WISA-E and demonstrating WISA-E. We have 13 new brands specifically around the licensing opportunity that we announced 30 days ago. We've met with 13 of them. Seven of them are currently reviewing the licensing agreement right now. We think this is great progress by the sales team and the WISA Association to be to so quickly have seven brands reviewing our license agreement. And then finally, the final milestone for people trying to track our progress is we've shipped more than 85 development boards for WISA-E modules to let brands test, develop, et cetera, on WISA-E. And that's worldwide, all regions for consumer electronics. Finally, we think there's going to be a lot of press coming up at CES just before, just after CES. But we will say that one of the big things is we will show a Tier 1 TV brand with WISA-E embedded in it, streaming using just our software, two speakers. We think that's a fundamental milestone that will excite the industry. We think all these meetings we've had will drive executives into the WISA booths, and we'll have a very successful CES. And we think all this activity will impact 2024's revenue materially. So with YCE, we've talked a lot today about the TV being able to go to audio speakers or sound bars or even smart speakers, right? We think that's important. But as you look forward into 2022, I'm sorry, 2024, you'll see more and hear more about implementations and expansion of the technology to allow YCE to be on phones or tablets as well as a TV reaching all audio devices. So we're excited about the response over the first 90 days. There are companies that are starting to design with the YCE module. We think it materially impacts our 2024. We think there's quite a bit of use cases that'll be demonstrated and announced both at CES and in 2024. There'll be TV partnerships, speaker partnerships, and strategic partnering as we go through the first half of next year. So finally, This slide, if you've watched us, is very similar, but look, we have a very strong IP position. We have WISA-E complete enable. We can talk to and engage customers at every level, whether it's the low-cost 2.4 solution, DS, whether it's the embedded solution and the direct implementation. We've got an established speaker association that is unparalleled in the industry. And there's 30-plus brands that have designed and used WISA technology historically. That really is partly driving why we've had so many meetings quickly. We're not launching WISA-E into a vacuum as a new company. We've launched WISA-E in three different flavors, three different cost points into an established customer base of WISA. And with that, operator, I'd like to open up the call to questions.