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Understanding MicroVision’s Risk Factors

Shares of MicroVision Inc. (MVIS) are up 773% over the past 12 months. Its laser scanning technology provides solutions for autonomous driving, interactive display, and consumer Light Detection and Ranging (LiDAR) modules.

Let’s take a look at its latest financial performance, as well as what’s changed in its key risk factors. (See MicroVision stock charts on TipRanks)

MicroVision’s Q2 revenue increased to $0.7 million from $0.6 million a year ago, beating consensus by $46,000. In Q2, the company provided performance data from outdoor testing results and deeper evaluation of its product, technology, and IP to potential customers.

MicroVision’s CEO Sumit Sharma commented, “The feedback we have received from potential customers so far has been very positive. With our proprietary active scan locking architecture based on proven technologies, we believe our LiDAR meets and exceeds their product expectations and will be the most cost-effective LiDAR product to address their needs.

“We expect our LRL product family will be available for sale, in small quantities, beginning in the fourth quarter of 2021.”

Higher operating expenses meant loss from operations widened to $14.9 million from $2.3 million a year ago. Hence, net loss per share was $0.09 versus $0.02 a year ago.

On August 5, H. C. Wainwright analyst Kevin Dede reiterated a Hold rating on the stock but did not assign any price target. Dede commented, “MicroVision is focusing nearly all of its development effort on its LiDAR offering and appears to be well-positioned to create shareholder value, although it may take an extended period of time for this to come to fruition.”

Moreover, the analyst expects more information on MicroVision’s LiDAR offering at the International Motor Show in Germany from September 7-12, and near-term track testing.

Now, let’s have a look at what’s changed in the company’s key risk factors profile.

According to the new Tipranks Risk Factors tool, MicroVision’s main risk categories are Finance & Corporate, and Production, each accounting for 25% of the total 28 risks identified. Since June, the company has added one key risk factor.

MicroVision noted that it has identified a material weakness in its internal controls that support the determination of the grant date of equity awards. This could result in material misstatements of MicroVision’s financial statements, and a failure to meet reporting standards.

Such a scenario may cause loss of investor confidence, damage to reputation, and an impact on the company’s stock price.

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