WISeKey boosts H1 Revenue guidance range
H1 2018 unaudited revenue increased by 36% to $25.7 million from $18.9 million adjusted revenue in H1 2017, driven by higher revenues at Cybersecurity IoT and Semiconductor
WISeKey shows strong sequential growth on core Cybersecurity and IoT businesses due to robust new customer acquisition and expansion in existing accounts
WISeKey expects to report revenue of approximately $60 million for full year 2018
ZUG, Switzerland- June 28, 2018- WISeKey International Holding Ltd (SIX: WIHN, OTCQX: WIKYY) ("WISeKey" or the "Company"), a leading Swiss cybersecurity and IoT company announced today its preliminary, unaudited half year ("H1") revenues for the six-month period January 01, 2018 to June 30, 2018.
- Double-digit revenue growth in Digital Identity, IoT & Cybersecurity segment
- WISeKey H1 revenue increased by 36% to $25.7 million from $18.9 million adjusted revenue in H1 2017, driven by higher revenues at the Cybersecurity IoT and Semiconductor segments for the smart car, pharmaceutical and fintech industries, and consumer products which, in the aggregate, are broadening the ecosystem for WISeKey IoT chips.
- Strong liquidity and financial position with $10.4 million in cash at June 30, 2018, up $4.1 million from June 30, 2017, due to improved operating performance.
- Further expansion of our vertical platform solution portfolio in Blockchain and Artificial Intelligence ("AI") following the acquisition of QuoVadis for managed cybersecurity and Identity Management services.
- Further enhancements of the vertical Platform for the IoT through the establishment of partnerships with leading players in the IoT domain.
- Expansion of patent portfolio with new IP and patents with the aggregation of 39 IoT / Semiconductors patent families (more than 200 patents in total) to its portfolio (https://www.wisekey.com/patents/).
Confirms full year 2018 revenue guidance of approximately $60 million, which will include initial revenue for WISeCoin Utility Tokens commencing in Q4 2018.
KEY REVENUE FIGURES 2018 (UNAUDITED)
Reconciliation of 2017 revenue per interim report Vs adjusted revenue
|H1 2017 Revenue per interim report||Adjustment from ASC606 implementation||Adjusted H1 2017 Revenue|
|By segment||Half Year||Half Year|
WISekey Identity Management, Managed PKI and Digital Signing Services
During the second quarter, commercial synergies with the Identity Management business of WISeKey QuoVadis commenced and resulted in milestone new wins in securing the connected cars industry, car and automotive component manufacturers, banking and insurance, as well as further eGovernment enablement services.
WISeKey QuoVadis also announced during the quarter the provision of secure e-mail services to more than 200 savings banks in Germany. WISekey QuoVadis Trustlink Deutschland GmbH and Finanz Informatik announced cooperation to provide secure e-mail (S/MIME) communication to the German financial services sector. In Germany alone, WISeKey QuoVadis provides similar PKI services to more than 300 enterprises, such as Allianz, Daimler, VW Financial Services, Siemens, Commerzbank as well as the Volksbankengruppe. Digital Onboarding combined with integrated personal signing services enjoys strong momentum in Switzerland with various new clients in the Cantonal and Private Banking sector. WISeKey QuoVadis EU based digital signing services, leveraging the benefits of European qualified certificates under the eIDAS regulation across borders are helping major global accounting firms, governments and banks to simplify processes and increase efficiencies. Multi-year signing services engagement customers include EY, PWC, KPMG, Dutch Chamber of Commerce as well as the Dutch Ministry of General Affairs.
The managed PKI and Cybersecurity business started to generate new revenues in Europe in relation to the GDPR implementation as more companies required WISekey QuoVadis technology to facilitate their compliance with the new European General Data Protection Regulation (Directive 95/46/EC), known as GDPR (approved by the European Parliament in April 2016; took effect on May 25, 2018), the primary law regulating how companies protect EU citizens' personal data.
GDPR mandates a set of standards for any company that markets goods or services and handles EU citizens' personal data to better safeguard the processing and movement of the data gathered. It requires that personal data is processed in a manner that ensures its security, while the rationale and the purpose for collection is transparent and the consent of the subject is obtained in advance. Companies are required to protect data against unauthorized or unlawful processing, accidental loss, destruction or damage, using appropriate technical or organizational measures. Since any company that markets goods or services to EU residents, regardless of its location, is subject to the regulation, the GDPR is expected to have a global impact on data protection requirements. Penalties for noncompliance include fines of up to 20 Million Euros per breach.
WISeKey's PKI provides technology solutions that can alleviate the compliance efforts and reduce risks for penalties. The WISeKey QuoVadis product can help organizations protect sensitive personal data while in transit and at rest; this is achieved thanks to encryption solutions enabled by trusted digital certificates. Users can encrypt their personal data and control who can access to it. SSL certificates assure end users that their personal data is gathered and processed by identified and genuine service providers, while communication is encrypted.
WISeKey has joined in June 2018 the Cybersecurity Tech Accord together with ten other companies that have joined the watershed agreement in the last two months to defend all customers everywhere from malicious attacks by cybercriminal enterprises and nation-states. The Tech Accord companies include ABB, Arm, Atlassian, Avast, Bitdefender, BT, CA Technologies, Carbon Black, Cisco, Cloudflare, Cyber adAPT, DataStax, Dell, DocuSign, ESET, Facebook, Fastly, FireEye, F-Secure, Gigamon, GitHub, GitLab, Guardtime, HPE, HP Inc., Intuit, Juniper Networks, KoolSpan, KPN, LinkedIn, MediaPRO, Microsoft, Nielsen, Nokia, Oracle, RSA, Salesforce, SAP, Stripe, Telefonica, Tenable, Trend Micro, VMware, WISeKey. These companies oversee important aspects of the world's communications infrastructure including cloud-based customer relationship management, collaboration tools, telecommunications, endpoint security, datacenter security, and encryption.
WISeKey's unique neutrality and position in providing a Trusted and Secure platform for Internet transaction is a real asset to mount a stronger defense against cyberattacks.
All Cybersecurity Tech Accord signatory companies make commitments in four areas:
The companies will mount a stronger defense against cyberattacks. As part of this, recognizing that everyone deserves protection, the companies pledged to protect all customers globally regardless of the motivation for attacks online.
The companies will not help governments launch cyberattacks against innocent citizens and enterprises and will protect against tampering or exploitation of their products and services through every stage of technology development, design and distribution.
The companies will do more to empower developers and the people and businesses that use their technology, helping them improve their capacity for protecting themselves. This may include joint work on new security practices and new features the companies can deploy in their individual products and services.
The companies will build on existing relationships and together establish new formal and informal partnerships with industry, civil society and security researchers to improve technical collaboration, coordinate vulnerability disclosures, share threats and minimize the potential for malicious code to be introduced into cyberspace.
Since forming the Cybersecurity Tech Accord, signatory companies have held two formal meetings to begin their work and have been planning new ways to engage with civil society, industry and consumer groups to solve cybersecurity challenges and better protect people around the world.
Intellectual property Enhancements
WISeKey's strategy to evolve into a major player on the IoT, Cybersecurity, AI and Blockchain market implies a constant evaluation of potential add-on acquisitions, development of new IP and patents. In just one year, WISeKey has aggregated over 46 patent families to its portfolio (https://www.wisekey.com/patents/) required to integrate the OISTE/WISeKey Root of Trust into IoT embedded devices with problem-solving AI solutions. For WISeKey, adding to its patent portfolio and intellectual property is key to ensuring that the company will remain a major player in the "DeepTech" for years to come. Its patent portfolio allows WISeKey to distinguish itself from other companies that use commonly available technology; WISeKey focuses on integrating unique technology that is differentiated, protected and hard to reproduce based on tangible scientific discoveries or engineering innovations.
Internet of Things (IoT) and Industrial Internet of Things (IIoT)
A focus area and fastest growing segment for WISeKey this year is the Internet of Things (IoT) and Industrial Internet of Things (IIoT). Revenues generated by this segment continue to increase due to the new generation of IoT Chips, sensor-based identification, authentication and data and creating AI for analytically rich data sets. What has emerged during the first half of 2017 is only a glimpse into how the IoT and IIoT technology used in solving complex logistics, manufacturing, services and supply chain problems, can deliver the most value for WISeKey.
Earlier this year, WISeKey announced a strategic partnership with IBM to secure the IoT using WISeKey's leading technology. The collaboration will provide enhanced security of sensitive data exchanged between devices across the IoT networks and the IBM Watson IoT Platform, by adding extended capabilities to secure IoT devices and the management thereof from a central location. By doing so, customers benefit from an increased trust in the data handled by their application, and a reduced risk of revenue loss due to cyber-attacks of all kinds thus leverage a greater value of their business.
IBM's Watson IoT Platform is a cognitive system that learns from, and infuses intelligence into the physical world. Device manufacturers and businesses can use the power of Watson IoT Platform to build specialized, integrated solutions to solve their business challenges. Watson IoT Platform implements a "messaging broker" that allows the exchange of information between devices and business applications, using a secure Public Key Infrastructure (PKI) technology to bring authentication and data encryption. This implies a seamless integration with the WISeKey concept of Root of Trust (RoT) that delivers the digital identity that can be leveraged later in the Watson IoT platform.
WISeKey BlockChain and WISeCoin CryptoTokens
During the first 6 months of 2018 WISeKey has also expanded into Blockchain and WISeCoin. WISeCoin is gradually emerging as a powerful revenue generator for the company as it allows the monetization of transactions on the emerging machine-to- machine economy.
WISeCoin will be initially be used as payment by connected electric vehicles at automated electric charging stations. WISeKey will be at the center of it all because its WISeCoin Machine to Machine Cryptocurrency Technology will be used to facilitate connected vehicle charging. The technology will be installed at electric vehicle charging stations and will be used to facilitate the completion of transactions without the need for credit cards or other traditional forms of payments. It means the owners of connected cars can charge their vehicles and pay using WISeCoins, which can be transferred from their wallets using NFC technology. The cars will have their own crypto wallet from which the cryptocurrency will be transferred to the electric charging station. WISeKey has already started integrating its Public Key Infrastructure (PKI) and IoT technology with connected car solutions from different manufacturers. This integration will allow the authentication of vehicle components and as a result, allow secure interaction.
Ensuring a high level of security for connected cars
The vehicles will feature a secure hardware module that will be a WISeKey microchip that will carry a WISeKey digital certificate. The microchip will allow WISeCoins to be sent in a secure manner. WISeCoin also has digital identification for the electric car as well as for the electric charger and this identification cannot be forged. It is important for the technology used in the autonomous electric cars to be highly secure. Most of the vehicles that are currently in the market have technology that may have vulnerabilities that place them at a high risk of being hacked. Data security, therefore, has to be addressed and this is why WISeKey has taken noteworthy steps towards making sure that the identification system is hack-proof.
The number of smart car manufacturers that use WISeKey's PKI Services has been growing steadily. The company plays a key role in the industry and things are only expected to get more exciting with the number of electric cars steadily increasing to approximately 250 million by 2020 compared to approximately 21 million in 2016. It is therefore important to make sure that their security systems cannot be compromised.
WISekey during this quarter has also confirmed its presence in China via a partnership with China Bridge Capital ("CBC"). WISeKey and CBC share the objective of quickly establishing WISeKey China as one of the country's leading providers of cybersecurity, IoT and Blockchain services for the growing Chinese market. The over-arching objective of the new company is to establish a market foothold with credible in-country leaders to maximize revenue in the near-term and realize reputable category position in the sectors of: retail, financial transaction, automotive, smart cities, consumer products, healthcare, smart card, industrial, transportation, and IT infrastructure, in the long-term.
WISeKey will establish an IoT Root of Trust and a PKI for the operation in China including a globally trusted Certification Authority within a security strategy framework in the country. The PKI is the center of all of the initiatives that provides the necessary security, encrypted and digital signatures, for electronic transactions.
WISeKey has already enter the sophisticated Chinese semiconductor and IoT market through the signing of several commercial agreements with Chinese companies. Recently, WISeKey announced that its IoT Blockchain technology is to be deployed in selected smart cities in China while its chips are already deployed for the Nanjing Smart City project. Chinese companies, such as Feitian Technologies, are working with WISeKey to develop innovative hardware and software solutions to enable users, applications and devices to securely authenticate the networks, verify the authenticity and integrity of firmware upgrades, and limit access to sensitive information to authentic users only.
Already, China is the largest market in the world for IoT with a 22% market share and over 1/3 of the machine-to-machine (M2M) connections for multiple machines, devices and appliances to the internet by multiple networks are in China. The WISeKey China JV is expected to fully capitalize on WISeKey's pioneering role in secure IoT and M2M communication, as China's IOT and M2M market value is estimated to grow from $80 billion in 2015 to over $160 billion by 2020. China's semiconductor consumption growth has continued and in 2016 far exceeded the worldwide semiconductor market growth for the sixth consecutive year. China's semiconductor consumption market grew by 2.9% in 2016 to reach a new record of 60.6% of the global market while the worldwide semiconductor market only grew 1.1%. During the past ten years, China's semiconductor consumption has grown at a 12.0% compound annual growth rate (CAGR), while total worldwide consumption has only grown at a 3.2% CAGR. The worldwide semiconductor market as reported by the World Semiconductor Trade Statistic organization (WSTS) has grown by US$91 billion from 2006 to 2016 while China's semiconductor consumption as reported by China Semiconductor Industry Association (CSIA) has grown by US$150 billion, in the same period.
Level I American Depository Receipt (ADR) Program
WISeKey also established a sponsored Level I American Depository Receipt (ADR) Program in the United States in May 2018. WISeKey's ADRs trade in U.S. dollars and provide access to the voting rights and to the dividends attached to the underlying WISeKey shares trading in the U.S on the OTCQX under the symbol WIKYY. Each ADR represents 2 ordinary shares listed on the Swiss Stock Exchange under the symbol WIHN. U.S. based investors can find current financial disclosures and Real-Time Level 2 quotes for the Company at www.otcmarkets.com.
"The establishment of an ADR facility and our inclusion on the OTCQX represent critical milestones of WISeKey's capital market roadmap strategy," said Carlos Moreira, Founder and CEO of WISeKey. "We are now able to provide our U.S. based investors with a direct way of investing, trading and accessing information."
WISeKey is among a leading group of Swiss listed company issuers enabling their shares to also trade and settle in the U.S. WISeKey was sponsored for the OTCQX by BNY Mellon.
WISeKey technology is in high demand in the U.S. and the Company is deploying large scale IoT applications based on standard and proven technologies (PKI, cryptographic Root of Trust, Digital certificates). The IoT will live up to its promise only if the connected devices, the data they generate, the business applications that control these devices and the services around them, can be fully trusted. In today's environment, where cyberattacks have become more common and increasingly sophisticated, there is an urgent need to fundamentally rethink the Security Stack for the IoT cloud.
WISeKey (SIX: WIHN, OTCQX: WIKYY) is a leading global cybersecurity company currently deploying large scale digital identity ecosystems with a patented process. OISTE/WISeKey's Swiss based cryptographic Root of Trust ("RoT") provides secure authentication and identification, in both physical and virtual environments, for the Internet of Things, Blockchain and Artificial Intelligence. The WISeKey RoT serves as a common trust anchor to ensure the integrity of online transactions among objects and between objects and people. For more information, visit www.wisekey.com.
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Press and investor contacts:
|WISeKey International Holding Ltd|
Company Contact: Carlos Moreira
Chairman & CEO
Tel: +41 22 594 3000
|WISeKey Investor Relations (US)|
Contact: Lena Cati
The Equity Group Inc.
Tel: +1 212 836-9611
This communication expressly or implicitly contains certain forward-looking statements concerning WISeKey International Holding Ltd and its business. Such statements involve certain known and unknown risks, uncertainties and other factors, which could cause the actual results, financial condition, performance or achievements of WISeKey International Holding Ltd to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. WISeKey International Holding Ltd is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.
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