What happened
Sections of WiMi Hologram Cloud (NASDAQ: WIMI) skyrocketed Wednesday morning after the company announced a new patented laser technology with claims in driverless cars, electric vehicles, medical imaging, and more. The company’s stock has been shattering over the past several months – recently down more than 75% from 52-week highs. However, WiMi stock is turning around today, up 20% from 10:45m EST.
so what
According to the press release, WiMi has been busy researching and developing 3D holographic pulse laser technology. With autonomous driving, vehicles use sensors to measure objects, such as the distance between your car and those around it. Apparently a WiMi device can take that information and display a holographic projection of this information to those in the vehicle.
Image source: Getty Images.
WiMi is an international stock in China. According to the company, the Chinese government has granted it a patent for this technology. WiMi believes this is strategically positioned for future success. In particular, the rise of electric vehicles could make greater use of sensors going forward, and patented technology could use WiMi to display information.
The press release did not mention any monetization strategy for the new WiMi device. So the stock is going up a lot today on profitability. While intellectual property is good, WiMi still needs to be marketed to customers.
WIMI data with YCharts
Now what
If I were a betting person, I would promise that WiMi Hologram Cloud will publish a stock offer in the coming days to take advantage of its high stock price. That’s because the company has a good history of doing this. On July 10, WiMi released a report on the fast-growing hologram market, announced TeslaElon Musk ‘s Alibabais Jack Ma in the process. The stock more than duplication in one day on this report.
WiMi took advantage of its higher stock prices days later when it announced a stock offer to sell more than 7.5 million shares, raising more than $ 61.8 million. The company needed the money – revenue in the first half of 2020 rose just 7.8% to $ 24 million, but revenue cost rose 134%, resulting in just $ 3.2 million in net revenue.
Don’t let the company name fool you – WiMi Hologram Cloud largely generates revenue from advertising campaigns and through its centralized payment processing software. With this fact, I would be very cautious putting too much credit in the company’s ability to monetize 3D laser technology in electric vehicles until it reveals a clear strategy and also announces customers.