Boston, MA 05/19/2014 (wallstreetpr) – Intermolecular Inc. (NASDAQ:IMI) is surging in intraday trading session by a high of 44.93% after announcing that SanDisk and Toshiba had jointly taken an exclusive license in a limited field under the collaborative development program. The technologies under the partnership were specifically developed for the next generation of memory.
Terms of Licensing
Under the terms of use, SanDisk Corporation (NASDAQ:SNDK) and Toshiba will be required to pay nonrefundable royalties as installments for each quarter for a predetermined period. The memory technology under use is expected to accord SanDisk and Toshiba a competitive advantage in the semiconductor memory industry. The licensed IP essentially outlines Intermolecular Inc. (NASDAQ:IMI) high productivity technology that can be used to accelerate research and development.
The license agreement comes at the right time as it will help shield the company from the backlash of Wall Street having reported a 9% drop in revenue for the first quarter that came in at $15.9 million, down from a high of $17.4 million a year ago.
Royalty Revenue More than Doubles
First quarter licensing and royalty revenue came in at $7 million up from $3.4 million for the same period last year. Revenue in this case was up as a result of accelerated payment from Global Foundries in relation to the suspension of the collaborative development program activities. Elevated licensing and royalty revenue which made up 44% of total revenue impacted gross margin for the quarter that was up to 58.7% from 46% in the fourth quarter of 2013.
Intermolecular net loss for the quarter widened to $3.9 million as a result of $1.1 million in restructuring related costs. This was more than double a net loss of $1.5 million that had been reported for the first of 2013. It was slightly lower sequentially, when compared to a net loss of $4.4 million in the fourth quarter of 2013.
Intermolecular Inc. (NASDAQ:IMI) estimates revenue of between $8 and $9 million for the second quarter mostly made of reported backlog as of March 31.
