FPC’s revenues for the quarter came in at SEK 685.9 million, down 54 percent against its revenues from Q1 of 2016. Despite the decline, the company nevertheless reports an operating profit of SEK 70.8 million.
In a statement announcing the results, FPC CEO Christian Fredrikson explained that the revenue drop was the result of “excess inventories in the value chain in combination with increased competition”, echoing FPC’s warning earlier this year that such factors would require the company to revise its revenue guidance for 2017. Fredrikson elaborated that the glut in inventories is the product of FPC’s OEM clients “having set high sales targets that they have not achieved”.
Nevertheless, Fredrikson expects things to turn around, calling the inventory issue “a short-term problem” that will “normalize during the second quarter”. Meanwhile, there are “distinct signals” that FPC’s effort to acquire iris-scanning specialist Delta ID is “strategically correct”, with Fredrikson reporting strong interest from customers in incorporating multimodal biometric authentication based on fingerprint and iris recognition into their new devices, perhaps following the lead of Samsung with its new Galaxy S8 smartphones.
The company is therefore taking the long view, with 2017 serving as a time to consolidate partnerships and further develop its technologies, and 2018 holding potential “opportunities to grow in new segments,” Fredrikson said.
May 4, 2017 – by Alex Perala