at cost of approx $130M, VMS should be generating $20M/yr in warranty revenue. I never understood why they were not charging yearly warranty. This is why they had "lumpy" revenues. To be in business over 20 years and just discover warranty revenue is astounding. What do they teach at Stanford?
Ever sales rep should be sending an invoice to every current customer for warranty costs. No more free software upgrades. Many customers will balk, but many will also pay up as that is what they are doing to every other vendor. I bet IDSY could get $10M/yr in warranty revenue if they just pursued it. To the customers that balk, they should be cut off
took them 1 week, but the slides are finally there. Looks like they intend to do some M&A's in the $1B-$3B range. Also learned a little about Life Sciences; they provide much of the glass to the pharma industry. Did not know that
at 80% gross margin, I wonder if this one deal can push them to profitability. I also wonder if they are going after other large, entrenched customers and trying to get warranties out of them as well.
I never understood why this was not their long running pricing strategy. Get the upfront money and then charge 18%/yr on a warranty. Beats the SaaS model.
a large company doesn't pay $850K to a small company because they think the small company is going out of business and as an "insurance policy". Rather, the large company could seek a secondary source from a competitor. That would be an insurance policy.
caseyboy2 is laughable
This $850K seems to be a new item whereby the customer was given free warranty. Good for IDSY to start charging this. This one deal alone can push them into profitability as these warranty deals typically have gross margins over 80%.
If you ever see a large company buying some older, smaller company, you often wonder why. It is because the bought company has a large stream of yearly warranty renewals that can provide a high profit steady cash flow stream to the buyer.
so in the old day when you sold stuff, customer would pay upfront for the hardware and software and get 1 yr of warranty for free. After that first yr customer had to pay 18% of the upfront cost to cover the warranty. The warranty got you free software upgrades and replacement hardware for any hardware that failed.
They said the customer was a 10 yr customer so it is something like that. Could be Nestle as their 2000 unit total fits into this cost structure. Could be Walmart and IDSY is now pushing back on them for support of ancient VAC2's and VAC3's
Warranty renewals are extremely high margin. Sending software over the internet is essentially free.
another vote of confidence from an existing customer. Warranty contracts are very high margin, especially on the software.
I assume this is recognized equally over the next 12 months.
amazing that caseyboy2 posts here, a stock with no ownership interest, yet his largest holding AMZN is plunging daily and not even a single post.
No wonder he still has to work in his 70's to support himself.
The satellite provider ORBC got into fleet technology a few years back and directly started competing with many of its fleet customers. One customer, IDSY had over 100K satellite assets with ORBC. Since ORBC started to directly compete, IDSY has been moving all its new customers to cellular technology which is now much cheaper. They also started to retrofit existing customers with cellular. It was a big loss to ORBC.
Now CAMP is competing with its customers like IDSY. If I was a customer and a supplier started competing with me, I'd find a new supplier. So the question is, can CAMP gain sufficient share against its customers before the loss of customers affects CAMP?
It's looking like we will do between 700K+ coins this quarter. It is possible that the market is strong right now and the increased rate is just due to coin market. More likely is they have captured a large Modern share from NGC. Already at 343K coins for the quarter and we are not even half way through.
I think NGC was caught flat footed and does not know how to respond yet. Ironically, the head of the Modern division left PCGS for NGC back in September.
with $16B in debt backed by used cars of dubious value, little cash, I would suspect the whole thing is worth less than zero. Carl Icahn probably getting margin calls on this and Chesapeake
2015 would have been down regardless due to VMS moving towards a SaaS sales model, but obviously not as much.
I don't understand why they don't take the offers to sell the business coming their way