BEAVERTON, Ore. - WiSA Technologies, Inc. (NASDAQ:WISA), known for its wireless audio technology, has secured a licensing agreement with a leading consumer electronics company, the firm announced today. The agreement marks a significant shift in WiSA's business model, transitioning from hardware to software, with a focus on licensing its WiSA E software suite for immersive audio experiences.
The unnamed electronics giant, described as a top-three leader in its category, will embed WiSA E's audio functionality into its devices, allowing users to activate enhanced audio features. This move is expected to generate a new revenue stream for WiSA through consumer activations and associated royalty payments.
WiSA E's software implementation is touted to reduce the need for additional hardware, potentially lowering costs for manufacturers and consumers. Consumers can activate the audio technology in their home environment, pairing their devices with compatible speakers for an upgraded entertainment experience.
The company anticipates that this licensing model will seed the market with WiSA E, encouraging aftermarket sales of compatible speakers. Devices featuring the new technology are expected to hit the market in the second half of 2024.
WiSA E is compatible with major System on Chip (SoC) providers, including Realtek, Amlogic, Mediatek, and Novatek, suggesting a broad potential for integration across various hardware platforms.
Brett Moyer, CEO of WiSA Technologies, stated, "This is a game changer in the industry," emphasizing the strategic shift towards a software-centric approach and the benefits of a built-in aftermarket revenue stream.
WiSA Technologies collaborates with several leading consumer electronics brands and is a founding member of the Wireless Speaker and Audio Association, which aims to establish industry standards for wireless audio interoperability.
The announcement is based on a press release statement.
InvestingPro Insights
WiSA Technologies, Inc. (NASDAQ:WISA) has made headlines with its new licensing agreement, but what does the financial data say about the company's health and market performance? According to InvestingPro data, WiSA's market capitalization stands at a modest $16.31 million, reflecting the scale of the company within the broader market. Despite the potentially transformative deal, the company's revenue has seen a significant decline, with the last twelve months as of Q4 2023 showing a decrease of 38.1% in revenue growth. This decline is critical to consider, especially when assessing the company's future revenue streams from its licensing model.
InvestingPro Tips highlight that analysts are expecting sales growth in the current year, which could be indicative of WiSA's market expectations following the new licensing agreement. However, the company is also quickly burning through cash, which raises questions about its financial sustainability in the short term. Moreover, the stock is currently in overbought territory based on the Relative Strength Index (RSI), a momentum indicator that could suggest a future correction in price.
Investors seeking more detailed analysis and additional insights can find over 17 InvestingPro Tips for WiSA Technologies, which can further inform investment decisions. To explore these insights, one can visit https://www.investing.com/pro/WISA and use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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