Energous Corp  (NASDAQ:WATT)
Q1 2019 Earnings Call
April 30, 2019, 4:30 p.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
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  • Call Participants

Prepared Remarks:

Operator

Good day and welcome to the Energous Corporation First Quarter 2019 Financial Results Conference Call. (Operator Instructions) Please note, this event is being recorded. I would like to now turn the conference over to Mike Bishop with Investor Relations. Please go ahead.

Mike Bishop -- Investor Relations

Thank you, Alisa, and welcome everyone. Before we begin, I would like to remind participants that during today's call, the company will make forward-looking statements. These statements, whether in prepared remarks or during the Q&A session, are subject to inherent risks and uncertainties that are detailed in the company's filings with the Securities and Exchange Commission. Except as otherwise required by Federal Securities Laws, Energous disclaims any obligation or undertaking to publicly release updates or revisions to the forward-looking statements contained herein or elsewhere to reflect changes in expectations with regard to those events, conditions and circumstances.

Also, please note that during this call, Energous will be discussing non-GAAP financial measures as defined by SEC Regulation G. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are included in today's press release, which is posted on the company's website.

Now I would like to turn the call over to Steve Rizzone, CEO of Energous. Go ahead, Steve.

Stephen R. Rizzone -- President, Chief Executive Officer and Director

Thank you, Mike. Good afternoon, and thank you for attending the Energous first quarter conference call. Brian Sereda, our Chief Financial Officer is joining me today. I would like to begin my comments with an overall status of the company as well as a general business review. While management and our Board of Directors plan to be further along the path to widespread adoption of the WattUp technology than we are today. As a company, we are energized by the continued intense interest in our technology, the numerous advancements we've made with RF charging, the strength of our IP and the engineering team we've been able to recruit and retain, all of which continues to support the significant upside of Energous and the opportunity to develop and sustain a market leadership position in the rollout of Wireless Charging 2.0. Any discussion on the current status of Energous' business needs to begin with commentary on the focus and direction of the company. Over the last few quarters, the major topic of our conference calls and financial presentations have centered on the WattUp Near Field technology.

The reason for this focus is straightforward. There is currently a better-defined and faster path to product launches and revenue for our Near Field technology in the key markets we have talked about previously, specifically hearables, including hearing aids and PSAPs, wearables and smart glasses. Since revenue is our top tactical priority, the majority of our recent commentary and updates have been focused on the Near Field technology. However, I want to be very clear that the company's vision of a ubiquitous wireless charging ecosystem includes both contact charging as well as charging-at-a-distance. Since the very beginnings of the company, charging-at-a-distance has always been the ultimate differentiator for Energous. Something that the current generation of wireless charging offerings will never be able to do. As difficult as the path to introducing a completely new technology on a global basis has been, nothing has deterred the Energous team from the goal of building out the Wireless Charging 2.0 ecosystem, and we are more confident than ever that we can, and we will achieve this goal.

With the direction and focus of the company as a background, there are two key elements that are impacting our tactical goals of customer shipments and revenue. The first is, regulatory. Despite the fact that Energous is the first and only company to receive FCC Part 18 approval for wireless charging-at-a-distance, and we have successfully certified the WattUp technology in 111 countries, including the important regional markets of North America and the European Union. The regulatory momentum we have been able to generate around the globe has not advanced as quickly in three key Asian countries: Japan, Korea and China. The lack of a well-defined path to regulatory approval in these countries has had a delaying effect on product launch decisions and timing that we did not anticipate. It is important to note that our top-tier customers are aware and engaged in our regularly efforts, and we have not lost these meaningful and impactful opportunities.

While some may have been delayed, we expect to see a number of these top-tier opportunities advance toward product launches as we begin to see a clear path for regulatory approval in these three countries. The second element impacting our business surrounds our customers' product development planning process and schedules. As we work with potential customers, the Energous and engineering team has developed proof-of-concept devices, or POCs, in some cases as many as six different versions for each customer engagement that is progressed beyond the initial entry stage. These POCs expand all three product categories: Near Field, Mid Field and Far Field; as well as a broad array of markets, including smartphones, desktop computers, robotics, medical devices, hearables, wearables, IoT devices, hearing aids, smart glasses, computer accessories, public safety and industrial application. Despite the fact that the POCs energy has developed have met or in many cases exceeded customer expectations. We have experienced delays in a number of final green light decisions for reasons beyond our control, including changes in our customers' organization, our product responsibility, M&A, funding and retail cost considerations, product launch timing as well as the aforementioned regulatory concerns.

We've always so experienced the highest -- high level of scrutiny and extended testing because of customer experiences with coil-based technologies that were not successful and have left a negative impression of wireless charging that we've had to overcome. Our business development team, working in concert with the dialogue sales organization, has taken a proactive and aggressive problem-solving approach to overcome these obstacles. These efforts are beginning to bear fruit as we believe we're now in a position to see several customers finalizing launch schedules with the goal of shipping to end customers before the end of this year. In addition to concentrating our customer product launches and revenue generation, the management team has been focused on extending our cash. Thanks largely to the fact that a majority of our 2-year silicon roadmap has been completed, reducing the costly expenses associated with chip development and the fact that we have been successful in leveraging the dialogue relationship and our outstanding store in the areas of sales and operations.

We have reduced our planned expenditures for 2019 compared to last year by over $3.5 million. Brian will have more to say about this during his comments. Some final notes on milestones before I turn the call over to Brian. Earlier this year, we saw the first (inaudible) availability announcement from our customer, Delight, in partnership with SK Telesys in Korea. Several weeks ago, I commented that the conference that we thought first PSAP from Delight would be available on Amazon within a couple of weeks. This turned out not to be the case. While the PSAP is available to consumers on Alibaba, the process of setting up distribution in the United States and the EU has proven to be a significant and time-consuming undertaking. Delight is fully committed to bring their WattUp-enabled products to these markets, and we expect that Delight will soon make additional announcements on improved product availability for options for -- in -- consumers in the United States and the European Union. Turning to our Tier 1 customer updates. We reported last quarter that our long-standing Tier 1 decided to extend the review on acceptance cycle for our last deliverable.

Discussions with this customer continue as to next steps. We also commented last quarters on delays associated with another top-tier consumer electronic company who we have been engaged with for some period of time. This company has asked for additional time to review their product specifications and features. Consistent with our earlier comments on the subject of delays, decision-makers that top-tier companies are especially sensitive to de-risking the launch of a product containing a new technology. So delays like this are to be anticipated. Having said this, we do expect to be able to provide a more definitive update for this customer during our next conference call. Moving on to intellectual property. Our IP portfolio continues to expand at a steady rate.

To date, Energous has 188 patents issued in 27 allowed for a total of 215 patents as well as an additional 110 patents pending. IP is an important consideration for our shareholders as it gives the company a strong advantage over any future competitors and increases the core value of the company. In summary, while we've experienced delays, the tactical business picture for our Near Field technology is starting to come into focus as we overcome obstacles unrelated to the technology, leading to reduced risk for early adopters, and ultimately, the green light for product launch. On this basis, we believe we're in a position to see products shipping to consumers from multiple customers before year-end. Strategically, Energous continues to advance the Mid Field and Far Field technology with customer engagements by standing a broad spectrum of markets and applications. We believe the underlying business has strong potential, and we are managing it accordingly with sufficient cash to carry the momentum forward. We have expanded and strengthened our IP portfolio, and most importantly, the company has the resources, experience, customer base, partnerships, technology and momentum to achieve our long-term goal of a Wireless Charging 2.0 ecosystem.

Brian, I'll now turn the call over to you for comments.

Brian J. Sereda -- Chief Financial Officer and Senior Vice President

Thanks, Steve. As you saw at the close of market today, we issued a press release, announcing our operating and financial results for our first quarter of fiscal 2019 ended March 31. Till the first quarter, we recognized $66,000 in engineering services and ship royalties compared to $56,000 in the fourth quarter of last fiscal year. Per Steve's earlier comments, we believe customers will be in a position to launch their products, beginning the second half of this year as we complete remaining regulatory, design and integration work. During the quarter, we also completed a $25 million registered direct offering, bringing our ending Q1 cash to $36.1 million.

Total GAAP expenses for the first quarter totaled $11.2 million, approximately $1.4 million lower than the $12.6 million in the prior quarter and approximately $2.3 million lower than the same period last year. The decrease compared to the prior quarter and prior year is primarily result of lower engineering cost and lower stock compensation. As Steve mentioned, we expect this trend to continue through the fiscal year, having completed the bulk of a new chip development work in 2018, and we should see a material drop in our expense run rate over the next few quarters. Headcount remains relatively flat compared to prior quarters as we ended the Q1 with 65 heads, heavily weighted toward engineering. Leveraging dialogues operational and worldwide sales and marketing through our partnership agreement has allowed us to maintain a focus on development work while dialogue provides global sales and operational support.

The net loss for the third quarter on a GAAP basis was approximately $11 million or $0.39 per share on approximately 27.9 million weighted average shares outstanding. This compares to $12.5 million net loss in Q4 of last year or $0.48 per share and $13.4 million net loss or $0.55 per share loss in Q1 of 2018. Now I'd like to go over non-GAAP review our numbers for the quarter as we believe adjusted or non-GAAP EBITDA provides a useful comparison for investors, especially, for a company in our stage when used together with GAAP information. Excluding $3.4 million of stock compensation, depreciation from a total Q1 GAAP expense of $11.2 million, net non-GAAP operating expenses totaled approximately $7.8 million, down $0.6 million over Q4 and $0.8 million lower than Q1 of last year.

Net of revenues or adjusted EBITDA or non-GAAP operating loss for Q1 was $7.7 million, approximately $0.7 million better than the prior quarter and $0.8 million better than Q1 of last year. Non-GAAP engineering expenses decreased by approximately $0.8 million to $5 million versus the prior quarter and was also $0.5 million lower than the same period last year. This is mainly attributed to lower chip development project costs compared to the prior periods. Non-GAAP SG&A increased over the prior quarter by approximately $0.2 million, reflecting Q1 trade show costs in a peak and year-end public company expenses in the first quarter. Compared to the same period last year, combined SG&A costs were approximately $0.4 million lower, mainly due to low legal expenses and headcount-related expenses.

As I mentioned at the beginning, we ended the quarter with approximately $36.1 million in cash and remain debt-free. As you will notice, our balance sheet will now show the present value of our operating lease liabilities as we -- as a result of our adoption of ASC 842 accounting for lease liabilities. In Q1, we recorded liability of approximately $0.3 million, which mainly represents the present value of the remaining term of our facilities leases. To close, we expect our cash operating expense run rate to decrease compared to prior quarters, and we believe we are on track to see the launch of additional customers later this year, leading to growth in ship royalties through our partnership with Dialog.

With that, I'll now turn it back to Steve.

Stephen R. Rizzone -- President, Chief Executive Officer and Director

Thank you, Brian. Let's now turn it over to the operator for questions from our listeners, please.

Questions and Answers:

Operator

(Operator Instructions) The first question today comes from Ilya Grozovsky with National Securities. Please go ahead.

Ilya Grozovsky -- National Securities -- Analyst

Thanks guys. On the cash burn, how much cash do you think you're going to burn in 2019 going forward from today on?

Brian J. Sereda -- Chief Financial Officer and Senior Vice President

Well, we expect to get our burn rate -- our non-GAAP burn rate to, Ilya, down below $7 million a quarter. So we would expect to burn approximately $28 million. You've got some timing issues. That's before any customer collections. That's strictly our operating expenses. At this point, we're not giving guidance on revenues and the timing of the collections. But again, as we've talked about, we expect certain customers to turn on the second half. The timing of those collections may fall into the first quarter of 2020. But overall, our operating expense burn rate will drop year-over-year.

Ilya Grozovsky -- National Securities -- Analyst

Great. And then on -- the second part is on the timing. Steve, can you go through the timing on some of your anticipated product launches from partners, just in terms of how do you see regulatory approval? How quickly does that happen? And are we talking about launches for holiday season 2019? Just kind of the timing on this?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

So we're focused as I mentioned in the comments on three markets: hearables, wearables and smart glasses. I believe these markets have unique advantages for our technology and are less susceptible, in some cases, to the regulatory issues because we can launch with certain customers in these markets on a regional basis, specifically, in the United States and in the European Union. So I believe that we'll start to see the ramp up in ship sales beginning slightly in the second quarter, extending into the third quarter as customers in these business segments ramp up for product launches, again, before the end of the year. I don't think we crystallize on all of the timing. It looks to be fairly back-end loaded.

We have seen initial purchases from several customers for early pre-production cycles. And as I said, the near-term focus we have is really to launch with customers on a regional basis in EU and the U.S. until we get a clear path to regulatory in China and Japan and Korea. Our very top-tier customers that have global aspirations in terms of product launch, they're the ones that are really affected and are affecting us as it relates to regulatory approvals in these 3 jurisdictions. We're working very closely with each of these jurisdictions, and we've also engaged top-tier customers in each of these jurisdictions to assist us in this regulatory effort. Each of these jurisdictions have their own process. And where we have been able to leverage the momentum globally around the SEC certification in these 3 particular jurisdictions.

They're very, very much focused on their own internal process. I'm really not in a position to predict given that we're talking about governmental agencies, the timing on these approvals. We do not see any that -- any area where we will not be able to get an approval. That's not been made known to us. So it's a question of how soon that these respective companies can complete their own process, much like the SEC did when we first approached them. And then how soon we can turn this into these regulatory approvals into customer launches.

Given the one final point, given the fact that we've got a number of customers engaged with these regulatory bodies, I don't think that we're going to have to see full regulatory approval before we start to see some green lights on product launches. As the path to regulatory approval becomes clear, and these top-tier companies gain more and more comfort that in fact, the regulatory approvals or certifications paths are not going to be far out, but are going to be relatively within weeks or months. I think we'll start to see some of these greenlighted top-tier company launches.

Ilya Grozovsky -- National Securities -- Analyst

Great, that's helpful. And then one last question, Brian. The share count for Q2, just because you gave an average -- the Q1 as an average, what do you think the Q2 share count is going to look like?

Brian J. Sereda -- Chief Financial Officer and Senior Vice President

Outstanding, it should be about 30.5 million at the end of the quarter.

Ilya Grozovsky -- National Securities -- Analyst

Thank you.

Operator

Our next question comes from William Gibson with Roth Capital Partners. Please go ahead.

William Gibson -- Roth Capital Partners LLC -- Analyst

Thank you. Can you share the number of products in the FCC pipeline?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

The number of products? I'm not sure what -- you mean the number of customers that are actually in certification?

William Gibson -- Roth Capital Partners LLC -- Analyst

Yes.

Stephen R. Rizzone -- President, Chief Executive Officer and Director

I would -- I don't know an exact number, Bill. They -- our first work, we complete as you know, all of the certification process internally here before we submit -- before our customers submit to the FCC. In our shop, we probably have...

Brian J. Sereda -- Chief Financial Officer and Senior Vice President

It's about 5 or 6.

Stephen R. Rizzone -- President, Chief Executive Officer and Director

6, yes, 5 or 6, I think, that are currently being tested in various stages of testing down. There's -- and as I said, we will complete all of the testing before they're formally submitted to the FCC.

Brian J. Sereda -- Chief Financial Officer and Senior Vice President

Bill, we actually built out our chambers downstairs in our labs to help facilitate a lot of that early FCC approval process to get the products cleaned up before they're submitted to the FCC. So a lot of the work we're doing in-house just because it's new technology, and we're hoping to constantly guide the customer through that. So it's a sort of 2-step process from here.

William Gibson -- Roth Capital Partners LLC -- Analyst

Yes, and what -- on the last call, you talked about setting up original design manufacturers to help newer customers or smaller customers that are coming in that you don't have the resources for. Is that still in the works?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

It's still in discussion. I don't think we're ready to launch that yet. I think we have at least two candidates that are well qualified to assume that mantle, but it will take a significant amount of resource on our part to launch that effort, all of the training. Also, we'll have -- we have more work to do on documentation. And there are still some issues in terms of some of the reference designs that we would look to turn over. So I think that, that's a goal. But right now, as I said, we've got a number of customers that are very, very close to moving to launch, and we just have to keep heads down and drive these customers the last few yards and really get them to the product launch cycle. So right now, all of our resources are really are heads down focused, driving these customers over the goal line.

William Gibson -- Roth Capital Partners LLC -- Analyst

Thank you.

Operator

Our next question comes from Jon Hickman with Ladenburg. Please go ahead.

Jon Hickman -- -- Analyst

Steve, can you tell us, do you have regulatory approval in those Asian countries for the contact-based?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

No, we have -- we do not have any regulatory approvals in the 3 countries that we talked about. Our first goal is to get contact-based approvals, which set the stage for distant approvals. But right now, the products in question that we are looking to launch are contact-based and that is the focus of the efforts in those 3 company -- countries.

Jon Hickman -- -- Analyst

Okay. Thank you. Appreciate that Paul.

Operator

Our next question comes from Mark Nack (ph). Please go ahead.

Mark Nack -- -- Analyst

Oh hi. I may have a couple, two or three questions here. You just mentioned that you were planning to do contact-base and get regulatory approval in these Asian countries. Aren't there quite a few other products out there that are contact-based that are working? And how would you differentiate Energous' product compared to these other products already in the other market?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

Well, certainly, there -- those that are familiar with the industry are well aware of our first-generation products. So largely from -- based on the technology called Chi, which is a coil-based technology and this technology -- and I think we've made this point several times in the past, is now approaching, I think, 15 years old in terms of the time that this technology has been launched.

And they have -- there are approvals in these three countries for the Chi Technology. The -- when you talk about these technology -- this technology, though, Chi in particular, where they've really been successful and where they've gained a level of momentum is in smartphones. As I mentioned, earlier, our focus is really initially to launch product where this technology is not readily available in areas like the hearables and the wearables and smart glasses, where the footprint requirements are very, very small, and where the coils are not able to really be engineered into these devices.

And so these 3 markets represent a relative greenfield for us because the Chi Technology, even though it is approved in these Asian countries, really cannot be incorporated into these devices. And so our focus right now is to gain regulatory approval for our contact-based technology. And as I said, the markets that we're concentrating on are the 3 that I've mentioned.

Mark Nack -- -- Analyst

Okay. So I just happened to be on an Apple Store the other day. Now that you're speaking about what we are. And I just -- I asked one of the techs there about AirPower if they're making any progress when they are thinking about doing a launch, and he basically said -- and this could be either good news or bad news for Energous, but he said that they -- 2 or 3 weeks ago, they just canceled this AirPower product, just didn't -- wasn't working up to their standards. Can you care to comment on that?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

Well, I mean, of course, I think Apple is -- has made or announced the decisions. As a matter of fact, Dan Riccio, the Senior Vice President of Hardware Engineering came out and announced the fact that they had discontinued the AirPower project. It was a very, very complex project. It involved a variation of the Chi Technology, a coil design, and it points out to some of the limitations of the coil technology.

On a single basis, so one-to-one charging basis, the coil technology is -- it works and has certain capabilities. When you start to move beyond a single device or you try and bring movement into the equation, the coil technologies really suffer. And of course, this is a strong point for Energous because we have the ability to charge multiple devices on a single surface. We have the ability to provide movement along the surfaces. And so, again they -- you're right. There is bad and there is good associated with this announcement, and we can't comment really further on it because we're not aware of Apple's plans.

But it's certainly proves the difficulty in bringing out these technologies when a company alike Apple has worked for multiple years and trying to bring a pad to market. It just shows how difficult any of these new technologies is to really bring to market.

Mark Nack -- -- Analyst

Was that an Airpad that they -- or their AirPower? Or...

Stephen R. Rizzone -- President, Chief Executive Officer and Director

AirPower, yes. It's -- AirPower is a -- it was a mat or a contact-based technology that was designed to support 3 devices simultaneously and that was really the basis of the complexity.

Mark Nack -- -- Analyst

Right. So I guess another question. For the 2.0 technology that you have or 20 Watt, are you going to need additional approvals in the United States and the EU? Or the Near Field, Mid Field and Far Field? Is...

Stephen R. Rizzone -- President, Chief Executive Officer and Director

So when we get a regulatory approval, it is, by definition, almost a generic approval. It doesn't specify power or it doesn't specify the general characteristics of the device. It's primarily focused on health and safety issues on emissions. And as long as the device in question meets the requirements for health and safety and emissions, the amount of power or the distances involved have really don't come into play. So the point being that once these approvals are made, they are made for any device or they are established -- they are made for any -- they are established for any device that can meet the health and safety and emission standards irrespective of wattage or distance or anything else along those lines.

Mark Nack -- -- Analyst

Okay. Because on -- there's comments sometimes on these conversation boards that -- I don't know, maybe, it's fake news.

Stephen R. Rizzone -- President, Chief Executive Officer and Director

All right, thank you. We are going to have to run because I've got quite a list of questions here. But I appreciate your comments, and thank you for dialing in.

Mark Nack -- -- Analyst

Yeah. Thank you.

Operator

Your next question comes from Greg Smith. Please go ahead. Your line is open.

Greg Smith -- -- Analyst

Thank you for taking my call. I just wanted to know what Steve has to say for the people up there who called this company a scam. And really, there is no revenues or really anything to really make anyone think, otherwise, as to why someone would think, this isn't a scam. Really, hiding behind a lot of NBAs and really just not being transparent to investors. I know a lot of people saw that class action lawsuit that was brought against under just recently. And I just want, Steve, to really speak to the pundits that are really digging in against them and really -- and why is there a reason to stay investing at Energous?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

Well, so let me just quickly deal with this call. First of all, we do not have a lawsuit pending against us. That is not the case, and we would not comment upon any kind of current legal situations. Second, since the very offset of the company, we've had naysayers, we've had people that do not believe in the technology, that don't believe in the company, that believe or don't believe, much of anything we have to say.

And we really can't negate this on a face-to-face situation. It's taken us longer, and we've admitted that to bring the company into the fully commercialized state. The obstacles that we've had to overcome have been very, very significant. And I think the reality of launching a new technology on a global basis -- I mean it's a very considerable task, but the company is certainly real and viable. Our customer list and our prospect lists is stellar. The technology works. The delays that we're experiencing now are not an element of -- or related to technology.

As I said in my comments, they're really related to things that are beyond our control like internal issues with some of our customers, regulatory funding, so on and so forth. And so it doesn't do us any good to really try and combat these issues directly. The best thing for us to do to is to just keep our heads down, execute on the plan that we have, and as more and more customers come to light and the technology becomes more prevalent, we believe that all of this will be in the rearview mirror. And that's been our strategy since the beginning, and that's what we'll continue to do.

Greg Smith -- -- Analyst

And now you've been saying this for -- I don't know -- how many years, probably 5-plus years at this point. So I mean thus far -- in terms of an investor who's been hearing you say the same thing over and over again. How do you have confidence just to not show a story on your shares and say, listen, this is a last cause. Stephen has been repeating himself for years upon years and years and really nothing has changed. It really is dangling the carrot in front of the horse.

Stephen R. Rizzone -- President, Chief Executive Officer and Director

Well, I think you're mischaracterizing things, and I don't think you are accurately saying the situation. We're talk about launching a new technology on a global basis with a go-to-market strategy that's based on fabless semiconductor. If you do your research, you'll see that the average time for fabless semiconductors companies to bring products to market is 7 years. We're in our fifth year. And so what we're doing is a tremendous undertaking that is very complex because not only do we involve fabless semiconductors, we also involve systems, complex systems, so on and so forth. And so I would take exception to your comments.

I understand that there may be those of you that have thing -- that thinks that we're repeating ourselves. We've tried to be as transparent as possible. And like I said, the best way for us to deal with this is just to continue to execute on the plan. As more and more customers come to market. I think this will be the ultimate indicator of the viability of the technology and the reality of the 2.0 ecosystem vision.

Operator

Our next question comes from Todd with Technology Innovations.

Todd First -- Technology Innovations -- Analyst

Yes. Thanks for taking the call. I just had a couple of questions. If like, for example, Delight is trying to introduce the hearing aid here, what is all these Asian approvals? If you want to sell stuff in America, why do you need the approvals in Korea and Japan and China? And the other thing as you had mentioned, all of your customers -- but I'm looking at the press release. I don't see any list of any customers. What customers are you guys working with?

Stephen R. Rizzone -- President, Chief Executive Officer and Director

So there's two questions here. And let me take them one at a time. First of all, the regulatory approvals in China, Japan and Korea have nothing to do with Delight selling product in the United States. Delight has already received regulatory approval in the United States and the EU to sell their PSAP product. Delight is a Korean company and they, up to now, have been a B2B type company. Selling their hearing aids and PSAPs to distributors, who in turn sell them in other parts of the world. They want to bring their products to the United States. And so they are simultaneously moving from a B2B to a B2C company and also establishing a distribution capability in the United States, and this is taking time to put together the distributors, the collateral, the websites, all of the things that go to making product availability work in the United States. And that is the project or that is the area that they're working on now.

Operator

This concludes our question-and-answer session. I would like to turn the conference back over to Steve Rizzone for any closing remarks.

Stephen R. Rizzone -- President, Chief Executive Officer and Director

All right. I'd like to thank everyone for attending our first quarter call. One final note, Energous will be attending the B. Riley conference in Southern California and the Landenmark conference in New York in May and the Roth Capital conference in London in June. And we hope to see many of you with these conferences, and we encourage you to attend. We want to thank you for your continued interest in our company, and we look forward to talking to again in 3 months. Thank you, and good afternoon.

Operator

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Duration: 40 minutes

Call participants:

Mike Bishop -- Investor Relations

Stephen R. Rizzone -- President, Chief Executive Officer and Director

Brian J. Sereda -- Chief Financial Officer and Senior Vice President

Ilya Grozovsky -- National Securities -- Analyst

William Gibson -- Roth Capital Partners LLC -- Analyst

Jon Hickman -- Analyst

Mark Nack -- Analyst

Greg Smith -- Analyst

Todd First -- Technology Innovations -- Analyst

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