Weebit Nano Limited (WBT) Earnings Call Transcript & Summary

How important is your phone. Some people would argue it's their most important asset or device ahead of other positions, such as their car for both business and personal use. And in terms of technology globally, we continue to see an explosion of innovation in electronic devices and even more immersive and intelligent technologies fast becoming integral parts of our lives. And one business at the forefront is ASX-listed Weebit Nano. They're a developer of advanced semiconductor memory technology with their goal to address the need for higher performance and lower power memory solutions in a range of electronic devices such as Internet of Things devices, smartphones, robotics, autonomous vehicles, 5G communications and artificial intelligence. And on Friday, it was announced last week that Weebit Nano will be included in the ASX 200 Index. Now that came as part of the S&P Dow Jones regular rebalance following its September quarterly review. So in 2 weeks time or so, Weebit Nano will be in the ASX 200. And that offers a number of tailwinds for Weebit Nano share price potentially because fund managers who are limited to investing in ASX 200 shares could potentially pick up Weebit Nano as a stock adding to their holdings. And secondly, there are a number of index tracking exchange-traded funds, they're intended to mimic the performance of the ASX 200 and these ETFs are also likely to be adding Weebit shares in a bid to track the benchmark index. But apart from that, the ASX 200 will also offer the tech sector broader media coverage, putting the company name out there for more retail investors to consider. With a market cap of more than $700 million, Weebit Nano share prices had a stellar performance, up more than 65% over the last 12 months. And I'm delighted tonight to have Weebit Nano's CEO, Coby Hanoch, joining me this evening on Money News from Israel, where the business is based. Coby, welcome to the show.

Hello. Thank you for having me.

Coby, for those who haven't heard of Weebit Nano, tell us a little bit about the business from your perspective.

So Weebit is in the semiconductor space, which today practically anything you touch has semiconductors in it. We are specifically in the memory space and even more specifically in the nonvolatile memory space. So this is the -- one of the biggest segments in semiconductor. It's expected to be over USD 120 billion in the near future. So it's a very big market. If you think about it, anything that you do today, anything that you touch needs to have memory in it. I'm not only talking about all of the TikTok or Instagram or whatever videos, it's really when you think about it, any electronic device that you turn on for the first time, you expect to have some software there, the trends, you expect to have some initial data there. And all of that needs to be on a memory that doesn't lose its data when it's turned off, obviously. And that's what a nonvolatile memory is. So we're developing a new kind of nonvolatile memory which is now becoming a very popular one called ReRAM. The existing technology that's been in this market for many years has been flash, but it's been running out of steam. So our technology in a nutshell, it's 100 times faster, 100 times lower power consumption, much better endurance and it's better in -- on many fronts relative to flash. And we're very happy that we finally got the technology working and what's called qualified so that it's ready for mass production. And now we're in that phase of moving into the commercial market and starting sales.

So Coby, would we have part of your technology in our phones or in our computers today? Or is this something that you're going towards?

We are going towards that. Right now, what you have is flash. Actually, again, your phones, cars, an average car, people don't even realize the new cars today they have more than 1,000 electronic components in them. And practically every single one of those needs a nonvolatile memory. So your phone is full of chips that have nonvolatile memory in them. And really any electronic gadget that you have at home, your microwave, your dishwasher, your washer and dryer and everything, they all have nonvolatile memory in them. So we are now in the process of getting our first commercial deals. We're expecting to sign -- we have an agreement with the manufacturer that we signed already of this -- for this technology. And now we're working on getting additional manufacturers what's called foundries and also getting product companies who will actually use our product.

So where is the demand going to be? And where is the growth going to come from? You said you've got a couple of contracts already being drafted Coby. Is it going to be phones? Or is it literally the world's your oyster?

So it's literally the whole world. This technology is used everywhere. You always have the initial markets, which are the lowest hanging fruit. So today, we started working with the manufacturing facility that is known to be strong in 3 domains. They are in the defense mil-aerospace what's called. So we have customers in that domain that we're already involved with. They are strong also in the medical space and in what's called industrial IoT in all of those machines that go on the manufacturing floor in factories. So right now, we have a certain focus on those 3 domains. But clearly, there are other domains that we're working in. And as I said, it's hard to think of any electronic device in the world that doesn't need a rear ending end in it.

How are you embracing artificial intelligence in your business?

So that's a very interesting question. First of all, one of the interesting things is that our memory cell actually functions in a very similar way to a synapse in your brain. So it's been already many years that researchers have been asking us for our chips and we have cooperation with quite a few universities and research institutes where they try to emulate the human brain using our memory, not simulate like most people do, but emulate, which is orders of magnitude more efficient. And that's caused neuromorphic computing. So we have already cooperation with such research institutes. It's still something that is -- it's going to take time till it actually reaches the market. It's going to take several years, but we do have that cooperation going. And AI, in general, requires tons of memory, no matter how much memory you give AI, they always want more. So that's one of the things that's really pushing the semiconductor industry. And when you hear that the industry is going down into small geometries into very, very advanced technology, it is mainly -- or one of the key drivers is AI. And those -- when they go to those small geometries, that's where flash cannot go anymore. It kind of got stuck on the way. So people are really looking now for a new technology that they can actually use when they're moving to the very advanced technology nodes.

Finally, Coby, I mentioned the inclusion of Weebit Nano in the ASX 200 coming up on the September 18th. Congratulations. This is a significant achievement for your technology business, isn't it?

Yes. Of course. Thank you, first of all. And yes, it is another important and major step for us. Obviously, it reflects the expectations of the company. So on our side, it just gives us yet another push forward to really get these commercial deals done and get customers on board and show the market that this is real and justified. So we're very happy with it. We're very proud of it. And we're going to be even pushing forward to really get those deals done.

Coby Hanoch , CEO of Weebit Nano, all the way from Israel on Money News on this Tuesday night. Thank you so much for your time.

Thank you.