2020 was a transformational year for WISeKey as we made significant investment in R&D to enhance our Artificial Intelligence capabilities, the real driving force behind IoT technology, expanded our product portfolio, and maintained leading-edge technology position and competitive advantage of our offerings. We also built up our sales force in the U.S., Europe and Asia, to take advantage of higher demand for strong security, authentication, brand protection and anti-counterfeiting services.
We ended the year with a strong cash position which supports our growth initiatives, both organically and through acquisitions, and at the same time gives us the flexibility to invest in strategic partnerships and joint ventures with global organizations.
2020 Key Financial and Operational Highlights:
- Acquired 51% controlling interest in arago GmbH (arago) on February 1, 2021 and reached a binding agreement to acquire the remaining 49%: arago’s leading technology that provides AI to enterprises globally through Knowledge Automation, its large recurring customer base and licensing model, brought significant synergies to WISeKey and strengthened our position in the fast-growing AIoT market.
- Strong cash position: cash and cash equivalents together with restricted cash increased to $21.8 million at December 31, 2020, from $16.6 million at December 31, 2019.
- Revenue of $14.8 million: although lower than FY 2019 revenue (due to the impact of COVID 19 pandemic, which disrupted supply chains worldwide, and the political and trading tensions between the U.S. and China), the new AIoT revenue stream and the rising demand for semiconductors since end of 2020, should fuel future revenue growth for WISeKey.
- Substantial reduction in general & administrative expenses (SG&A): the decrease of 32% to $10.7 million in FY 2020, from $15.8 million in FY 2019 was due to steps we took to manage our overhead costs and quickly adjust to the new environment. While for 2021 we expect total SG&A expenses to increase (as some of these costs, mainly traveling related costs will return to pre-COVID levels, and additional expenses related to the arago acquisition), we expect SG&A expenses as percentage of revenue to decline in the coming years due to general cost reduction initiatives we have and will continue to implement.
Cash & restricted cash at 12/31/2020
Spent in R&D efforts