When it comes to quarterly reports, unprofitable companies can be hard gauge.
Even harder than that though, are companies who don’t even make revenues. Like memory technology stock 4DS Memory Ltd [ASX:4DS] for example.
Despite its $250 million market cap, 4DS doesn’t actually sell anything — yet.
They’re a novel semiconductor company working tirelessly to turn their ReRAM memory concept into a working product. Which inevitably should lead to the development of a high-density, and superior performing memory chip.
That chip could then disrupt the highly competitive mobile and cloud markets. Offering a superior competitive advantage for users, and a revenue stream for 4DS.
Trouble is, 4DS has still yet to prove the viability of ReRAM. Not that that’s stopped its share price from climbing 8.33% higher today.
But they’re getting closer…
More testing, more results, more money
In its quarterly update today, 4DS has provided an overview primarily of its ongoing testing.
Noting that on 1 February it finalised testing for its ‘Second Non-Platform Lot’. A follow-up test of several prototype chips (wafers) aiming to confirm results from the first ‘Non-Platform Lot’.
If this sounds convoluted, just think of it as testing to confirm consistency in the results of the chips.
Which is exactly what 4DS managed to achieve, reporting:
- Confirmed that the Company has been able to repeat the results for each of the key memory characteristics (speed, endurance and retention) that were achieved with the First Non-Platform Lot;
- Confirmed that significantly, 19 of the 21 device wafers were functional, a first for the Company (the two nonfunctional wafers were the result of being manufactured outside the imec process windows); and
- Provided 4DS with further valuable insights with respect to how changes in key process parameters affect key memory characteristics; i.e. which process changes increase which memory characteristic.
In other words, 4DS is getting closer to creating a workable chip. One that should be able to offer faster and more reliable memory capabilities.
On top of that, production for their ‘Second Platform Lot’ chips is already underway. Giving 4DS a chance to analyse and test these newer wafers sometime in the current quarter. Barring no unforeseen hold ups — pandemic related or otherwise.
All of which is helping 4DS close in on their commercial objectives. A milestone that should finally see them bring in some revenue from sales.
What’s next for 4DS investors?
Looking ahead, investors will simply have to remain patient. Awaiting further results from the upcoming Second Platform Lot.
Because as 4DS states:
‘The results of the analysis of the Second Platform Lot is an important step for 4DS and its partners to pursue their strategic objective of commercialising the Company’s technology.’
So, shareholders should hold out hope that they’re in the final stretch of development.
Perhaps just a few short months away from actually seeing some meaningful revenues.
And that is worth getting excited about. Which is no doubt why the share price is trading higher today. Anticipating the next logical step for this long-awaited memory technology.
However, 4DS certainly isn’t the only technology company brimming with potential. There are a plethora of small companies out there just waiting for a possible breakout. Especially those with hopes for major disruption, again, like 4DS.
With that in mind, we’ve put together a list of some of our favourites. A collection of stocks that are all primed to take advantage of an AI boom in the months and years to come.
To learn more about these unique stocks, and the opportunities ahead of them, click here.
For Money Morning