Executive Summary

Revenue accelerated sequentially to $1.17M in Q3 2024 (+240% QoQ; +52% YoY), driven primarily by Components and initial WiSA E contributions, with gross margin improving to 19% from 3% in Q2 and -217% in Q3 2023 .
Management expects a significant uptick in WiSA E-related revenue in Q4 2024 as a multi-national licensee ships media boxes for the holiday season; Android OS is in production with Linux transmit adaptation targeted for 2025 .
Strategic pivot continues with the definitive agreement to acquire Data Vault/ADIO IP ($200M in stock at $5/share + $10M unsecured note; 3% royalty to Master Vault), with plans to rename the company Datavault and appoint Nathaniel Bradley as CEO post-close; preliminary proxy filed to advance closing .
Liquidity ended Q3 with $3.9M cash; inventory reduced 17% to $1.9M; operating expenses elevated amid investor relations/legal costs and project ramp, and going-concern risk persists absent additional capital raises .
Wall Street consensus estimates via S&P Global were unavailable; compares to estimates not provided; monitor Q4 holiday unit shipments and proxy outcomes as stock reaction catalysts .

What Went Well and What Went Wrong

What Went Well

WiSA E commercialization milestones: “WiSA E TX intellectual property now shipping in media boxes with Android OS and expected to be in stores for Christmas,” supporting Q4 revenue acceleration and broader 2025 rollouts (Linux adaptation underway) .
Margin recovery: Gross margin improved to 19% vs 3% in Q2 and -217% in Q3 2023, aided by mix (Components) and the absence of large inventory reserve increases that pressured prior periods .
Licensing traction: Five WiSA E agreements signed with multi-national brands; plan to reach eight in 2024; “executed licensing agreements with leading HDTV brands, covering 43% of the HDTV market that uses the Android operating system” .

What Went Wrong

Elevated OpEx and net loss: Q3 total operating expenses rose to $5.47M (+$0.80M YoY), reflecting higher investor relations/legal and ongoing R&D; net loss to common shareholders was $(7.35)M (EPS $(1.39)) .
Financing dependence and going concern: Management disclosed substantial doubt about continuing as a going concern absent further capital; cash from operations negative YTD, with financing activities needed to support FY25 .
Supplier concentration and execution risks: Heavy reliance on sole-source contractors (China/Japan) and timing risks for mass production ramp across licensees, which management cautioned can shift by “a month or two” .

Financial Results

Core P&L vs Prior Year and Prior Quarter (oldest → newest)

Metric	Q3 2023	Q2 2024	Q3 2024
Revenue ($USD Millions)	$0.769	$0.345	$1.172
Diluted EPS ($)	$(144.98)	$(11.89)	$(1.39)
Gross Margin (%)	(217%)	3%	19%
Total Operating Expenses ($USD Millions)	$4.670	$5.416	$5.469

Notes: Wall Street consensus via S&P Global unavailable; estimate comparisons not provided .

Segment Revenue Breakdown (oldest → newest)

Segment	Q3 2023 ($USD Millions)	Q2 2024 ($USD Millions)	Q3 2024 ($USD Millions)
Components	$0.258	$0.314	$0.984
Consumer Audio Products	$0.511	$0.031	$0.188
Total	$0.769	$0.345	$1.172

Geographic Revenue Mix (oldest → newest)

Region	Q3 2023 ($USD Millions)	Q2 2024 ($USD Millions)	Q3 2024 ($USD Millions)
Asia Pacific	$0.252	$0.264	$0.877
North America	$0.504	$0.026	$0.161
Europe	$0.008	$0.055	$0.134
Other	$0.005	—	—

KPIs Snapshot (Q3 2024)

KPI	Q3 2024
Cash and Cash Equivalents ($USD Millions)	$3.921
Inventory ($USD Millions)	$1.860 (17% reduction vs prior period narrative)
Contract Liabilities ($USD Millions)	$0.233
Warrant Liabilities ($USD Millions)	$0.019

Driver commentary: YoY revenue increase of $0.403M was “mainly attributable to Components” (+$0.726M YoY), while Consumer Audio Products declined (-$0.323M YoY) . Margin improvement vs Q3 2023 reflects lapping a $1.4M inventory reserve taken last year vs nominal reserve in Q3 2024 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
WiSA E-related Revenue	Q4 2024	None provided	“Significant uptick vs Q3”	Raised qualitatively
WiSA E Licenses	FY 2024	Target “8” by YE (from Q1)	5 signed to date; goal remains 8	Maintained target
WiSA E TX OS Support	2025	Emphasis on Android	Adaptation for Linux underway for 2025	Expanded scope
Investor Event	Jan 2025	Not specified	Investor Day “at or immediately following CES”	New event timing

Earnings Call Themes & Trends

Topic	Q1 2024 (May)	Q2 2024 (Aug)	Q3 2024 (Nov)	Trend
WiSA E Licensing & Revenue Path	5 licenses signed; target 8 by YE; initial shipments in H2’24; revenue streams include royalties, modules, NRE	Execution risk noted (production dates can move); ramp expected in H2	Significant Q4 uptick expected; 5 agreements formalized; media boxes shipping for holiday	Improving visibility; near-term ramp
Margin Structure	Shift to higher margin software licensing over time; HT margins ~30–35%	Gross margin 3%; lapping past inventory charges	Gross margin 19%; expectation for higher structure as WiSA E/Data Vault licensing scales	Recovering; structurally higher long-term
Data Vault/ADIO Strategy	Not yet announced	N/A	$210M IP purchase; rename to Datavault; Bradley CEO; 3% royalty to Master Vault; commercialization focus on ad network (ADIO) and IDE exchange (Datavault)	Strategic pivot; new TAMs
Liquidity / Nasdaq	~$8M cash; Nasdaq plan accepted; reverse split effected	$6.11M cash; monitoring; financing needs ahead	$3.92M cash; going-concern disclosure; capital raise needs	Tightening; financing required
Supply Chain / Concentration	N/A	Sole-source contractor reliance detailed	Sole-source reliance reiterated in filings	Execution sensitivity persists

Management Commentary

“We had $1.2 million in revenue, up 240%. Our gross margins improved… We ended the quarter with $3.9 million of cash.” — Brett Moyer, CEO .
“WiSA E-related revenue will have a significant uptake in Q4 versus Q3.” — Brett Moyer .
“It’s fair on WiSA HT to model 30%–35% [gross margin]… with WiSA E kicking in… and software licensing out of Data Vault, to have significantly higher gross margin percentages [in ‘25–‘26].” — Brett Moyer .
“$200 million in stock at $5 a share and $10 million in an unsecured promissory 3-year note… Post-closing, Nate will become CEO… we’ll change the name to Datavault, and I’ll become CFO.” — Brett Moyer .
“On the Datavault… monetization… a 70–30 split… 30% coming to Data Vault… with large institutional buyers like Bloomberg and BlackRock and Accenture.” — Nathaniel Bradley .

Q&A Highlights

Revenue drivers: Q3 revenue was “still primarily Gen 1 WiSA HT,” with some WiSA E contribution; Q4 expected to be more WiSA E-weighted .
Margin model: HT unit margins ~30–35%; WiSA E software licensing and NRE expected to lift margins in 2025–2026 .
Commercialization visibility: Datavault monetization via an information data exchange with a 70–30 revenue split; buy-side/sell-side partnerships to be announced .
Investor Day timing: “At or immediately following CES” in early January; both technologies showcased .

Estimates Context

Wall Street consensus (S&P Global/Capital IQ) for Q3 2024 EPS and revenue was unavailable due to missing CIQ mapping, so beats/misses vs consensus cannot be determined at this time .
Given management’s Q4 commentary and holiday shelf timing, near-term sell-side estimates for Q4 revenue could require upward revisions contingent on actual shipment velocity and license activation rates .

Key Takeaways for Investors

Sequential inflection: Q3 delivered a material sequential step-up with Components-led revenue and early WiSA E contributions; Q4 should see a stronger WiSA E mix as media boxes hit shelves, a potential near-term trading catalyst .
Margin trajectory: Structural margin upside from software licensing/royalties as WiSA E scales and Data Vault IP is integrated; HT margins remain a useful floor at ~30–35% in applicable units .
Strategic repositioning: The Data Vault/ADIO IP acquisition broadens TAM (ad networks, IDE data exchange, HPC/digital twins) and rebrands the company to Datavault; monitor proxy and closing milestones closely .
Execution risk: Production timing can slip; supplier concentration and sole-source dependencies heighten operational risk—size positions accordingly near holiday ramp .
Liquidity watch: Cash declined to $3.9M; going-concern disclosure remains; expect additional financing steps to fund FY25, which can drive dilution and volatility .
H2 narrative shift: With five WiSA E licensees signed and goal of eight in 2024, the story is pivoting from hardware to licensing; track activation royalties and receiver module attach rates into Q4–Q1 .
Event path: CES/Investor Day in early January should showcase combined portfolios; potential catalyst for broader investor understanding of Datavault monetization .

WISA TECHNOLOGIES, INC. (WISA)·Q3 2024 Earnings Summary