The Weebit Nano (ASX:WBT) share price dips on widening losses

The Weebit Nano (ASX: WBT) share price is slightly down today after the memory developer reported widening losses today in its half results.

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The Weebit Nano Ltd (ASX: WBT) share price is faltering after the company posted its first-half results for FY21.

The computer memory developer’s shares have been sliding over the last month, down approximately 39%.

‘Major progress’ fails to inspire the Weebit Nano share price

Firstly, revenues from operations remained at zero, with the company still seeking commercial agreements. Weebit Nano remains highly focused on continuing the development of its silicon-oxide ReRAM (resistive random-access memory) technology.

When you combine no revenue with company expenses and a big research and development (R&D) effort, the result is substantial losses. Weebit Nano’s loss in the first half came in at $7.24 million. This represents a 123% increase in losses from 1H FY20. However, $4.89 million of this half’s loss was from the company’s ramped-up R&D.

This expenditure aided in Weebit Nano improving its ReRAM tech with its long-term development partner CEA-Leti. The company was able to verify that its production process is repeatable and consistent in October, with more than 99% of its cells functional. This key requirement allows Weebit to begin transferring its tech to a production fabricator.

The company also filed 5 new patents during the half to ensure the protection of what all those millions have gone towards. Three of the patents pertain to ReRAM optimisation and multi-level storage (which Weebit holds exclusive rights to commercialisation). The other 2 patents relate to further improvements to the memory cells.

Looking to ink a deal

Multi-million-dollar losses are clearly not sustainable in the long-term. Weebit Nano no doubt knows this and is keen to arrive at a commercial agreement ASAP.

The board believes they are well-funded to continue the development of its memory and conduct commercialising activity. The source of this funding is the $15 million placement carried out in November. Weebit Nano’s cash balance was roughly $18.86 million at the end of December half.

CEO Coby Hanoch further commented on the company’s position:

Following the heavily supported placement share purchase plan, we are now funded to accelerate our planned development activities for the embedded, standalone and neuromorphic memory markets, as well as support ongoing improvements to our base ReRAM technology.

Importantly, our strong balance sheet enables us to accelerate our development of a selector for the standalone market, where we are targeting, as we previously committed, a working combined cell by September 2021 and a working array by Q1 FY22.

At the time of writing, the Weebit Nano share price was 0.42% lower, trading at $2.35. 

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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