BeammWave booked its first net sales as it delivered the Molex project. Q1 2024 was undramatic, with net sales reaching SEK1.1m (7% deviation from our estimate), while EBIT and EBITDA were 11% below our expectation, with both figures at -SEK3.8m. BeammWave has several parallel sales discussions within its end markets, including consumer premise equipment (CPE), base stations, and handsets. We expect some of these to bear fruit during 2024. However, we get the sense that CPE and base stations are much closer to adopting digital beamformers than the handset market. Thus, we are increasingly cautious about how quickly handset manufacturers could adopt BeammWave’s technology.

BeammWave concluded its rights issue, raising SEK26.7m before fees. The rights issue was subscribed to 39% with and without support from unit rights. Thus, guarantee commitments were utilized, bringing the total subscription to 68%. Conditional on an acceptable exercise rate of the warrants, we believe the existing financing structure will be enough for BeammWave.

We have made several estimate changes after BeammWave’s Q4 and Q1 report. Firstly, we will reduce our NRE expectations for 2024 while increasing our long-term hardware-related sales estimate due to the potential from Molex. We also reduced our IP-related net sales forecast as we were cautious about how quickly these could adapt to BeammWave’s technology. Due to the rights issue and our new forecast, we have reduced our fair value range from SEK4.2-17.0 with a base case of SEK9.2 to SEK2.0-12.0 with a base case of SEK6.5. Due to the high allotment of shares to the guarantors, we believe the shares will be under pressure before they are sold off. Concrete customer projects will continue to be the main catalyst for the share.