Earnings Call: Q2 2021

Aug 17, 2021

Quarterly report

Welcome to the Vistelink Technologies 2021 Second Quarter Earnings Update Meeting. During today's presentation, there will be an opportunity Please note, this event is being recorded. I would now like to turn the conference over to Belinda Marino, Corporate Secretary of the Board of Directors. Please go ahead. Thank you, and good morning, everyone. I'd like to remind everyone of the Safe Harbor statement referenced in the SEC filings. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward looking statements, including statements made during the course of today's call. Statements contained herein that are not based upon current or historical facts are forward looking in nature and constitute forward looking statements within the meaning of Section 27A of the Securities Act of 1933 in Section 21E of the Securities and Exchange Act of 1934. Such forward looking statements reflect the company's expectations about its to future operating results, performance and opportunities that involve substantial risks and uncertainties. When used herein, the words anticipate, believe, estimate, upcoming, plan, target, intend and expect and similar expressions as they relate to VIZLINK Technologies, its subsidiaries or its management are intended to identify such forward looking statements. These forward looking statements are based on information currently available to the company and are subject to a number of risks, uncertainties and other factors that could cause the company's actual results, performance, prospects and opportunities to differ materially from those expressed in or implied by these forward looking statements. For a more detailed discussion of some of the ongoing risks and some uncertainties of the company's business, please refer to the company's various filings with the Securities and Exchange Commission. And now, I'd like to turn it over to Mickey Miller, our CEO. Thanks, Belinda. I'd like to welcome you all to the VIZlink Q2 2021 earnings webcast. I'll be joined on this webcast by Mike Bond, CFO of VIZlink. We'd like to take this opportunity to report on our full year results and the progress we've made in the Q2 of 2021. To also provide an update on our latest developments and future prospects. Participants will be able to submit questions during the webcast from the main webcast page, we'll try to take as many as possible at the end. We are very pleased to report revenues in the Q2 that were 85% higher than the amount to execute in the Q1 of 2021. In addition, our quoting activity continued to increase with new bookings growing over 2 50% during the first half of twenty twenty one compared to the corresponding period in 2020. This accelerating sales growth, together with our ongoing focus on cost containment and strategic use of financial resources helped us significantly narrow our EBITDA loss in the 2nd quarter to 5 to $78,000 compared to $2,400,000 EBITDA loss in the Q1. As a result, our operations have not only returned pre pandemic levels, but we are well positioned for future growth. Just some side comments. I thought this was a great quarter for us. So let me just put it in perspective. 18 months ago, when Mike and I started here, this company was undercapitalized. It was in debt with our vendors. We had a very high operating cost, our new product development was anemic and the business was declining year in and year out, and then we were hit by the pandemic. The team at BizLink did an extraordinary job. We had furloughs that effectively to put in a 40% pay cut for all senior management and many levels of management. And everybody in this company to pay the price in their salaries to be able to keep this company moving forward that we were able to get to where we were at the end of 2020 with the opportunity to raise additional capital. So I want to give credit to the entire VIZULINK team for the extraordinary job and sacrifice that they've made for this company to get us here. And I'm super excited about the future that we've been able to build and the future is now for us, because our commitment to relentless innovation, which has been a business strength throughout its history, resulted in a release of incredible products in 2021, including the IP Link 3.0, to Quantum receiver and the DV6100 that have already played a role in capturing substantial new business this year, including the announced wins with Alabama Public Television and the U. S. Department of Defense. In fact, these three products alone have already surpassed 6 to initiate initial sale this year. We plan to continue to aggressively refresh our product offerings to maintain our leaderships in the markets we operate. We have increased our R and D investment and we have recently hired a new Head of R and D, to John Gass, who we're very excited to have part of the team. You also know about our very exciting news about closing on our purchase of Mobile Viewpoint. The acquisition allows us to exploit a number of significant trends with respect to the market for live video, which can be addressed by Mobile Viewpoint's innovations in bonded cellular, 5 gs and AI driven automated production technologies. These include the following. 82% of all IP traffic today is video and live video is less than 20%. Estimate to expect around 13%, but it's the fastest growing sector with 72% CAGR in the last 5 years. That's 70 to present growth per year in the last 5 years according to Cisco. Content consumption is diversifying, becoming more personalized. Solutions that offer a hybrid of transport over a various amount of meetings, whether it's 5 gs, bonded cellular, COF TEM, fiber, satellite for public IP will be the key for growth, and that's what we're building. Remote production, also known as REMI, enables high value production at more cost effective price points with a reduced carbon footprint. And finally, AI driven production will dramatically reduce live production costs, enabling a wider range of new content be rendered economically. As far as the strategic rationale for making this acquisition, Mobile Viewpoint provides us with innovative technologies and solutions that combined with our own capabilities will enable our customers to acquire and deliver video over any preferred public or private network. This presents a tremendous growth opportunity for us as 5 gs and other networks, along with machine learning, will revolutionize how video is produced and transported. Notably, Mobile Viewpoint also brings us very exciting AI driven automated to support the production and camera solutions, as well as pioneering development team that has a history of being first to market with solutions that make a real difference, including support for multi camera REMI, H. 265, which is ATBC, 5 gs and Starlink integration. This acquisition means that we can now make the most of these transformative live video trends and bring high quality live video production to events that was historically an economical to produce like amateur and semi pro athletics. The acquisition also provides us with increased scale and R and D power and creates a new powerhouse that leverages both to VIZlink's 50 plus years of broadcast technology leadership and Mobile Viewpoints innovations in bonded cellular and AI driven automated production. It should be noted that the 2 companies are also very complementary in terms of geographic coverage, market sector footprints and product lines with virtually no overlap. With combined offices across Americas, Europe, Middle East and Asia and a reseller network of over 150 distributors, VizLink has a scale to provide on the ground support to a wider customer base than before. Finally, a result of the mobile Viewpoint acquisition, ViZinc will now have all the hardware and software solutions to acquire, produce, contribute and deliver IP, video and data over whatever private or public network is preferred and available, making our connected edge strategy a reality. The bottom line is that for VIZLINK, this acquisition represents an ideal deployment of capital, highly strategic and makes a lot of sense. This is a kind of targeted investment that we've been seeking for quite a while, and we are confident that it will play a major role in the future growth of the company. I'll now turn it over to Mike Bond, who will walk us through our financials. Thanks, Mickey, and good morning, everyone. Here are some of the main financial results for the Q1. Revenues for 3 months ended June 30, 2021 were $7,600,000 and by the way, that does not include $4,300,000 of deferred revenue. That compares to $4,100,000 for the Q1 of 2021 and $6,000,000 for the 3 months ended June 30, 2020. EBITDA, which is earnings before interest, taxes, depreciation and amortization was a negative $578,000 for the 3 months ended June 30, 2021. That compares to a negative $2,400,000 for the 3 months ended March 31, 2021. We ended the Q2 of 2021 with $55,500,000 in cash and cash equivalents, compared to $60,000,000 at the end of the Q1 of 2021. Gross margins were 52.8 percent of revenue in the Q2 of 2021. That compares to 46% in the Q1 of 2021. Net loss attributable to common shareholders was $834,000 or $0.02 per share in the Q2 of 2021 compared to a net loss of 2,700,000 or $0.07 per share in the Q1 of 2021 and a net loss of 778 ks for $0.05 per share in the Q2 of 2020. Net loss attributable to common shareholders was $3,500,000 or $0.09 per share for the 6 months ended June 30, 2021, and that compares to a net loss of $5,200,000 or $0.45 per share for the 6 months ended June 30, 2020. I'll now turn it back over to Mickey to provide an operational update and outlook on the business. Thank you. Thanks, Mike. The numbers that Mike just shared with you don't include the 4.3 of deferred revenue that if you looked at the K or 10 ks, Which basically means we built, we shipped and we delivered $4,300,000 of goods to a customer that didn't make it through customs through the end of the quarter. So we're not able to recognize that as revenue, but that revenue has now been recognized and payment has been received. So it was a heck of a quarter. And again, I want to extend thanks to the entire Visig team. You as owners of our company should recognize that the Visig team did a heck of a quarter here and we're only getting started. So from an outlook perspective on the broadcast live production side, we really started to see a resurgence in this market as live events have made a robust comeback. Obviously, with the Delta variant, there is some uncertainty there, but we are starting to see robots come back. As you can see with The first half of this year, we had 2 50 percent more orders than we had last year in terms of dollar volume. We expect that the integration of the mobile Viewpoint technology and products will help us make a strong inroads in the live production market, as we now have a completely new suite of solutions to offer. We are the 1st company now in this space that has to the complete suite. Many companies have bonded cellular, some companies have proprietary networks on suite of products to be able to offer our customers a very compelling solution that is managed by one single software application. On the Milgov side, the Milgov market is showing strength as evidenced by another nice Department of Defense order we received in the quarter. There could be some new exciting opportunities for cross selling Mobile Viewpoint products to law enforcement and military organizations. There are several use cases that Mobile Viewpoints have, whether backhaul for drones that they've been able to deploy in many first responder locations as well as cameras on-site during civil unrest or for forensics. So those are exciting opportunities that we see. What we see is a great opportunity to take the technology both our traditional as well as the mobile Viewpoint integrated into a complete solution to provide first responders with to do their jobs more safely and to proactively protect and serve us. Finally, SATCOM, we reconstituted our satellite product line. In one of our new product offerings in the area, the DD6 has been a nice introduction. So we basically have 2 primary products there, our MSAT product, which to our mobile satellite product where you can deploy anywhere and get connectivity, as well as our new DV6100. Looking forward, we are optimistic that demand for our key markets will continue to increase for the balance of 2021. While there are some potential challenges on the horizon due to forces outside of our control, such as the ongoing battle to manage COVID around the world, at this point in time, we are forecasting increased demand for the sectors we operate in. As a result, we see considerable opportunities to grow our business and having mobile Viewpoint as part of the visiting family will certainly help make that a reality. We look forward to updating you on our progress. Now we'd like to answer some questions that have been submitted during the webcast. Okay. First of all, I want to thank everybody for the questions that we have. As you've probably seen through our social efforts, we're trying to connect with our owners. You are our owners. You own this company. We want to connect with you and understand what's on your mind to address any questions that you have and be transparent as we can be. Obviously, we have NDAs with many customers. We would love to put out press releases every day and video of our product being used in the world, but we're only allowed to do that when our customers approve and allow us to do that. And certainly we're not able to disclose anything that's under NDA with customers, but we will be able to talk about any customers that has allowed us to talk about things. So I think the first one, I think Actually, I think the first question is about sorry, go ahead. Yes. I do want to say, in order to drive questions, we did say, we will anyone who asks a question that we have on the call will send some swag to. So if you have If you do ask a question, please DM us with your information and we'll send you some swag. We appreciate Your support for VisLink and for your questions, because we have more questions than ever now. I really appreciate it. Go ahead, Mike. Yes. Thank you. So first question I noticed right off the bat, obviously everyone is very excited and I think curious about Mobile Viewpoint. And so the first question obviously is, how big is Mobile Viewpoint? How many people? What's their revenue? So Essentially, there are about revenue is about US7 $1,000,000 We expect obviously some synergies there. We first order of business in terms of integration is to integrate their solutions their product line in with our own to create a combined go to market model, if you will, to get out and aggressively pursue our customers. As Mickey said, we now feel like we have another weapon in the armory that we can use with our customers and even potentially new customers. So again, the revenue there is about $7,000,000 at this point. They've got about 20 people. They do a great job leveraging that number of people with a very aggressive R and D schedule. We think we'll be doing to increase an additional investment in their product development in their with their R and D team, but we're looking forward to growing that business substantially. Great. Here's one. Do I have to worry about another reverse split? I think hell no is the answer. And you can take all the worries you have in your life and put that one at the very bottom of the list. Yes, as Vicki said, yes. Look, in the past, the company did a lot of reverse splits because they basically were funding losses in operations as Mickey has mentioned previously. We think we've got the platform at this point to breakeven and we're looking forward to continuing to progress that. And so we don't see any need to do anything like a reverse split. We think our share price, our capitalization, everything will stay above the minimums, will stay listed and will continue to progress in our share price as we build a better platform. What came first, the chicken or the egg? I just want a hat. Michael Osmundson, you get a hat. You get a hat. Okay. Let's see. Mike, there's I mean Mickey, I see one that says, there's a good one that says that with the new acquisition of Mobile Viewpoint, how do you see integrate to your current business and I think I mentioned that. We're going to take it easy at first. We don't want to overwhelm a group the size of Mobile Viewpoint. To Michel Vies is their leader and we think highly of him. A strong part of our reasoning and rationale for doing this acquisition was to the talent and the leadership there and their vision. So we're going to try to marry that to our vision and our go to market model and progress in a combined fashion with our customers. But on the operational side, we will obviously integrate them in financially, but we'll to leave them alone operationally. At this point, they are in Alkomar, the Netherlands. And we anticipate making many stops in Netherlands. But we want to leave them alone operationally for a while and just integrate their solutions and their go to market model. Yes. I think here is this is a pretty common question. I think 3 or 4 times is, does Mobile Viewpoint already have StarLink capabilities, will this service be promoted by StarLink? So I think what our goal is and what we've talked about, if you've seen our investor deck, it's about taking advantage of the connected edge opportunity that we see. Cisco expects over 500,000,000,000 IoT devices connected by 2,030. Our view is that in the next 10 years, every industry will be disrupted by the connected edge. And what that means that everything will be connected on the edge, machines, people, devices, you name it. And that impacts the industries we're in, but also future industries that we may be in. And we see that video putting things in perspective, historically, video was handled over proprietary network, audio was over proprietary network, data over network. Now with IP, Internet protocol connectivity everywhere. With IP, it's just one packet. That packet can have video, audio, metadata, you name it, and can be distributed over any medium, whether it's 5 gs, whether it's WiFi 6, whether it's mesh, whether it's a proprietary custom, whether it's StarLink, whether it's GEOSAT, whatever link, and that's what we want to make sure that we can offer our customers, an opportunity to use whatever link they is most economical and fits their needs, meets their needs based on the use case that they have to be able to connect their entire network. Because what's important, historically, companies have always had an IT department. But the future is that IT or connectivity or data and massive processing power are all going to be 1. And so the operations are being disrupted to be able to leverage to use these tools. To be able to do that, you got to have connectivity and you got to be able to work across all types of connected devices. So that's our goal. In addition with the AI with mobile Viewpoint, we get an AI capability that helps us move forward our AI expectations and goals and then ultimately with big data for real time analytics that will disrupt traditional workflows. So that's our future. That's where we're headed. And that's what the relationship is today, is yet another medium for us. But we see a lot of opportunity across the board to do a lot of things with a lot of different customers, because we have this ability to bring things from the edge and create information to fulfill our mission today. Our mission today is to create technology that serves and protects us and connect us to the content we love. That's our mission today. But as we build and we do well there, there'll be opportunities to take that the technology we have and the capabilities we have to other markets to do the same thing. So a question from Peter Taladis. He said congrats on the acquisition. He said my question is about to supply chain, do you anticipate any supply chain disruptions? You said you hadn't in the Q1 and we still feel the same. We don't think we'll have any major supply chain disruptions. We do see the supply chains tightening up. We are taking obviously some defensive measures. We're ordering out ahead of in some cases our orders on key parts and supplies, but we don't anticipate that becoming a factor in terms of our ability to meet our customers' orders. Thanks Mike. Here's another, when do you expect Vislink to to become profitable. We don't give guidance. There's a lot of things going on in the world still today. As I mentioned, the Delta variant, we'll see what happens there. But I mean, if you just take a look at this past quarter, If that deferred revenue would have cleared custom one day before, do the math. That was 4.3 percent, you know what our average margins are. And so that would have dropped over $2,000,000 to the bottom line. I think that answers your question. Yes. And just to add to that, look, We had a very difficult platform to work with as Mickey mentioned when we first started. We think we've done a lot of yeoman's work in terms of making the platform able to create profit as we increase sales to drive leverage. We went through a very difficult time with the pandemic. It essentially put a big part of our business on hold that is live production. We're now seeing a major increase in our order activity and quoting activity. So we think the live production business is coming back strong. We have every confidence again as Mickey said that the business is going to come back and go back to pre pandemic levels and we feel like the work we've done on the platform, the money we've raised, some of the strategic opportunities we're going to address, including Mobile Viewpoint gives us a real leg up in terms of being able to create to a profitable platform in the future. Here's a question from John Hammer. I know Mig has stated that most acquisitions failed previously, why stating that Vislink would be very judicious in making any acquisition. What made Mobile Viewpoint the right acquisition for Vislink? And how will you integrate them with Vislink and fully synergize the 2 into 1 successful company? Great question. We looked at a lot. There's not a lot of players in this. If you look at the number one player is LiveView, which was just acquired by Carlyle for $400,000,000 They were acquired by Francisco Partners 2 years ago for $200,000,000 So in 2 years, they increase the value by $200,000,000 And those of you, Carlisle is probably the best investor or one of the best investors in the world. Blackstone, Carlyle, Big Time Private Equity Companies. And so, LiveView and there's a few others in the space and we've got to know most there and we really like to your point that the challenge with integration, you can have a great strategy, you can have great synergy and all these things, but it comes down to people. And we really like the people of MobileViewpoint. Michelle Beitz has done an incredible job growing this company, bootstrapping this company without any outside investment. That's profitable. They've been growing. They have a great reputation with their customers. We talk to customers that are super excited that we're now together because they think that both Mobile Viewpoint and DizLink have the same regard to innovation and R and D. And so we're really excited that we think that our cultures work very well. They're super efficient. They get things done. You can see if you go to their to YouTube or to their any social, you can see the things they do. They're very capable group of people that we're really looking forward to 1 +1 equals 3 type of thing. So, I think that's what put it over the top for us here. Here's a question that says, do you anticipate additional acquisitions? Are you continually looking for new opportunities? And the answer there is absolutely. We did a capital raise as you know back in February. We just spent a bit of that in cash to acquire Mobile Viewpoint. We still have what I'll consider is good dry powder to do more strategic work. We also reserve the opportunity to go to the market again if we're successful and raise more capital to do more strategic acquisitions. But we will not stop. We'll continue to look at opportunities to grow the business inorganically and kind of jump start the platform, if you will. Yes. Here's a question from Jessica Dalton. Is this stock going to improve? I can't speak for the stock, but Warren Buffett says, the market in the short term is a voting machine and the long term is a weighing machine. Our focus is on making the billing the value to make the weight of this thing to drive the stock. So obviously, Mike and I and our team are very motivated by stock is a large part of our compensation. So we're focused on that, but we don't get caught up in it. What we're focused on day to day is building value in this company. What is that? That's connection with our customers, connection with bringing innovation to those customers and driving the opportunities. Secondly, as you know, we're very judicious in how we deploy our capital. We view this capital as your capital. We are using your capital as owners you are owners of this company. And I can tell you we're very judicious in how we deploy this capital to get the returns that you deserve as shareholders. And we'll continue to do that every single day to build long term value for you, the owner of this company. Yes. Mickey, that plays into a question by John Rutherford here that he asked, when do you see the revenue from the acquisition hitting the bottom line? When do you see the impact, Ben, basically? And the answer there is almost immediately. Michelle has run a great organization that's very profitable. We do expect to see obviously additive revenue and additive bottom line impact almost immediately. So that's we're very excited about that. We didn't to purchase a burn rate. We actually purchased a business that's up and going, profitable and produces cash and runs very well. So we're very excited by that as well. It's from Billy Phillips. When do you anticipate being operationally cash flow positive, paying to shareholders dividends and what are the key drivers to financial health and growth. We kind of mentioned answered this in one of the earlier questions. If you look at the numbers for this past quarter, I think that will answer that question. But our focus when we started off in this little over 18 months ago, was to get to cash flow positives. Now paying a dividend, we think there's tremendous opportunity here. So we don't think this will be a dividend stock. But if we look at everything and we say, hey, the best thing to do is buy back stock or give a dividend. If that's the best use of capital for our shareholders, we'll do that. But right now, we see the tremendous opportunity because of the Connected Edge opportunity to invest that you'll get outside returns through the investments we make. Here's a question from Mark Thoma. He said gross margins increased by 10% in the second quarter to 52.8%. He said, Is that your target market margin? Sorry. And the answer is yes. Essentially, it's around 50% to 55%. Obviously with product mix, some of our products enjoy much higher margins than that and some slightly lower, but that is in general where we think margin should stay going forward. Okay. Here's another question. Can you discuss some businesses you've taken as a new CEO with Exoplan? What was the valuation to evaluate the exit. What companies yes, MyCareer, I think you can see it on the website, but we sold built to the Tyco or the Lucid Technologies Power Systems business, we sold it to Tyco Electronics. I ran that for 4 years. That was a business that when we sold it was $1,600,000,000 in sales, we sold it for $2,500,000,000 and then was Group President of Andrew Corporation, which we grew from 800,000,000 to $2,200,000,000 and sold that for $2,600,000,000 Ralph Faison was the CEO of Andrew and he's actually on our Board. I built a company called Blink Networks, which is a pre-five gs fixed wireless company that we sold to CCI. And then Mike and I started here. So Coincidentally, Mike was the one at Lucent who sold the business that I ultimately ran for Tyco. So That's the connection. Small world. There's another question. Go ahead, Mike. Sorry, here's one from Ethan Bing. Hi, Ethan. He says, Hi, Mike. What impact do you think the Mobile Viewpoint will have on margins? And the answer there is, we think it will be positive. Mobile Viewpoint has very good margins, in some cases in excess of 60% and almost up to 70 percent in some cases, but we do think it will have a positive uplift on our margin potential and we're looking forward to integrating those products and to reap that benefit. Yes. Here's another one. Please discuss how much success you or someone on your team has with acquisitions, what dollar amount? Firstly, we did a lot of acquisitions in growing the Andrew Corporation. So I've done a lot around the integrations. But I think our acquisition guy, none better than Mike Bond here. He's done over $30,000,000,000 of acquisitions in his career. He led this acquisition. He spent 4 weeks in Amsterdam bringing this to a close. And he's got tons of experience. He was at JPMorgan for a while. So we're really excited that we have Mike on our side to lead our acquisition. Thanks, Mickey. Here's one from Ethan Bing. I think Ethan, this might be your second question. You're doubling down here. You said the purchase agreement did not explicitly prevent Triple from hiring mobile viewpoint talent. You said how do you plan to retain the talent and bridge our 2 cultures. Great question. One, we don't think there's any problem or vulnerability to having our people leave to go to triple. They're 2 different businesses. And so therefore, we don't think there's really a problem there. In terms of integrating our cultures and incenting people, We do have what Mickey and I consider as a fairly aggressive incentive plan inside the company, both bonus and competitive salaries. Obviously, we reviewed with Michelle the team and we looked at the key players and all the players and we look forward to making sure that all of them are excited to be a part of the VIZULINK family going forward. We will do the hard work in terms of looking at our people costs and making sure that everybody is competitively compensated and is feeling comfortable in their role at the company. So we're very excited to bring the 20 people of Mobile View Point into the family, if you will. Yes. Here's one from Anthony Talamani. I understand the nature of NDAs, but I've seen Bislink mention as a partner with Tesla and StarLink. To confirm or deny or give any information as to whether this is true. Look, like I said earlier on, we would love to talk about every single one of our customers. But if we confirm or deny something, then you're going to know by deduction whether we're doing something or not. That means doesn't make sense to have any NDAs at all. So I can assure you, if we're allowed to talk about any customer, or have video from that customer, We will. As an example, the Olympics, of course, you can't put anything about there about the Olympics. The Olympics, they obviously make a lot of money through the rights that they have. So, the only way we can do that is if someone sees a Vislink spotted. So, I know a lot of you don't like our Vislink spotted stuff, but if it's in the public domain and someone sends us a picture, we can use it. If one of our partners shows them using it, we can use it, but we can't use images that are owned by other properties and so or talk about customers that we haven't had permission to talk about. So we'll continue to do that. I know it's frustrating for a lot of people. But as I said, we're very focused on building this business, on growing the connected edge, bringing that to the markets we serve today and building that from mid air. As I've said many times, Mike and I did not come here to run a small company. We see a massive opportunity here. We see the opportunity to build DISLINK into a very successful business and that's what we focus on every day. We'll have time for one more question. Mike, do you want to take that? Yes. Mickey, yes. Here's a good question and it's from John Rutherford. It says, to be clear, We have a $4,000,000 revenue we didn't get reported? And that's referring to the deferred revenue that Mickey spoke of in the body of our text. And here we had an order and we've disclosed this in our 10 Q. We had an order for the United States Army that we were originally going to ship to Afghanistan. That shipment was diverted to a different location. And given the complications of that of diverting and accepting that shipment, it missed by about 2 days in terms of being accepted and included in the revenue for the Q2. So accounting rules say that we shipped it. So therefore, it's revenue, but it's deferred revenue. We don't we defer it and recognize it when it's accepted by the customer. That's the terms of the contract. So given that, we do defer it. It's in deferred revenue at the end of the second quarter and will be picked up as revenue in the Q3. Okay. And Mick, yes, you one more quick question. Someone asked a good question about the PPP loan. Has it been forgiven? And the answer there is, we have made application. We have done the calculations and we believe that, yes, we will it will be forgiven in its entirety and we won't owe anything to the government in terms of paying that loan back. Okay. All right. Well, let me just close. I think we have a great opportunity here. I think we've made progress quarter on quarter in terms of getting the operating platform that we need to be successful, the new product development capability that we need to be successful. And now with Mobile Viewpoint acquisition, I think we have a tremendous opportunity to continue with our mission, which is to create technology that serves and protects us and connects us with the content we love and we'll continue with that. But we do see a bigger play in other industries as well around the connected edge. I think it's going to transform and disrupt every industry today. I think there's a tremendous opportunity for us to take advantage of it given our skill sets and our capabilities. Video combined with audio combined with metadata does tremendous things in many industries, whether it's insurance, whether it's in security, there's the capabilities that we have around that, I think can be deployed in a lot of different areas. But our focus is this initial market that we are involved in of media and entertainment and first responders and mil gov. As you can see with our customer base, the Department of Defense, Alabama PBS, we have some long standing relationships with some very large customers. And we think there's opportunities to build on those as well as opportunities to grow to share and with the Mobile Viewpoint acquisition, we think that gives us more opportunities and more products to be able to position to Vislink as a supplier of choice as our customers make decisions on what their new technology going forward is. Thank you everyone for your support for Vislink. You are the owners of this dock. We want to communicate with you. We'll continue to try to find with the right tempo of communication. We want your ideas. Now with Mobile Viewpoint, this is a product that can be sold in a lot of different places. I think we're going to see someday with their IQ product that content that heretofore wasn't accessible like division 2, division 3 type athletics that will be possible because of the cost effectively that will be remote produced AI driven. So, if you see opportunities that are interesting, send it to us because we like our sales force to follow-up on that. But we see a great opportunity for our shareholders to help us identify new opportunities in those lower tier markets as we continue to grow. Thanks again. We appreciate your support.