SKYX Platforms Q3 2024 Earnings Call Transcript

Quartr
Provided by Quartr
November 12, 2024

There are 9 speakers on the call.

Operator

day, and welcome to the Skyx Platforms Corp. Third Quarter 20 24 Earnings Call. Today, all participants will be in a listen only mode. Please note that today's event is being recorded. I would now like to turn the conference over to Ronnie Cohen, Skyx Founder.

Operator

Please go ahead, sir.

Speaker 1

Good afternoon. Thank you everyone for joining us for the Q3 update call. With me today, we have our President, Steve Schmidt and our Co CEO, Lenny Sokolow, that are going to join on this call. I will start by moving it to Steve Schmidt. I think we have here the cautionary statement first.

Speaker 1

And after you take a brief look here, our President, Steve Schmidt We'll start with the call.

Speaker 2

Okay,

Speaker 3

Ronnie, thank you very much. It's great to be with you here this afternoon. So let's get into it. We generated record 3rd quarter revenues of $22,200,000 compared to $21,600,000 for the Q3 of 2023. Next, prior to the completion of the $11,000,000 equity raise in October 24, as of September 30, 2024, we reported $13,000,000 plus in cash, cash equivalents and restricted cash as compared to $15,600,000 as of June 30, 2024.

Speaker 3

And in October of 'twenty four, we secured $11,000,000 equity preferred stock investment representing $2 per share of common stock with no warrants led by a Global Marriott Hotel chain developer and owner of over 70 hotels, plus significant insider investing by myself at $500,000 Co CEO Lenny Sokolow at $250,000 and Co CEO John Campe at $250,000 Let me take a second to just give you my perspective in terms of why I remain so excited about the future of Sky Technologies. I invested originally in this company at $12 at the original offering for Sky. And I remain today, in fact, quite frankly, more excited about the future of this company based on everything that we've accomplished and everything we have yet to do that we have in the planning phases. And there were 8 or 9 reasons that I invested at that time and remain excited today. Ronnie Cohen, 1st of all, is a leader, extremely bright visionary and inventor of this product.

Speaker 3

The company team, the management team and the Board, all with tremendous knowledge of this industry. The business strategy with electricity being a standard in every home and building, our mission was to make every home and building become safe and advanced and smart. Wow, safety was a key thing. Our products save lives and reduce injuries. Insurance companies, to remind everyone, and media have a fiduciary responsibility to support and report on these cases.

Speaker 3

Next, proprietary products and services. We now have over 97 global patents and trademarks protecting our products, software and making competition tougher. We have a global partnership with GE, global company, huge licensing group and they believe in our product and they believe it has a chance to become a U. S. And global standard.

Speaker 3

The National Electric Code where we've talked about in the past the 10 segments already voted into the NEC code book and working on mandatory, which we believe will be game changing. ANSI, the American National Standardization Institute and NEMA, the National Electric Manufacturers Association have approved our Sky Ceiling Receptacle specifications. And the total available market is over $500,000,000,000 in the U. S. Alone.

Speaker 3

And then finally, global, with over 30 countries will adopt U. S. Electrical standards. And so those key things, this is why I really invested then and it's why I'm investing now again, is because that belief continues and these are really the key points and key things that I thought about as I made my additional investments in the company. And I think holds true for many others who also invested in this latest round.

Speaker 3

So I hope you appreciated that perspective. So continuing on, net cash used in the operating activities for the Q3 ending September 30, 2024 decreased sequentially by 39 percent to $2,600,000 compared to $4,200,000 in net cash used in the Q2 of 2024. Company gross profit for the Q3 ending September 30, 2024 increased sequentially by 4% to $6,800,000 compared to the quarter ending June 30, 2024. As common with companies such as ours, when sales are converted into cash rapidly, often referred to as the Dell Working Capital Model, the company leverages its trades payable to finance its operations to enhance its cash position and to lower its cost of capital. We want to emphasize that we have sufficient cash to achieve our goals including being cash flow positive in 2025.

Speaker 3

We continue to grow our market penetration of our advanced and smart plug and play products and we expect our products to be in close to 15,000 U. S. And Canadian homes by the end of 2024. We expect our products to be in tens of thousands of incremental homes in 2025. We strongly believe our products can save many 1,000,000,000 of dollars annually to insurance companies by reducing fires, ladder falls, electrocutions among others.

Speaker 3

Management expects that once it's completed the entire range and variation of our safe plug and play products, we will start being recommended by insurance companies. Additional products are currently in production and are expected to arrive by the end of 2024. Products will comprise advanced and smart plug and play lighting including recessed lights, downlights, exit signs, emergency lights, ceiling fans, chandeliers, pendants, holiday kids themed lights, indooroutdoor wall lights among other things. Our total addressable market, which I just spoke about prior, our TAM in the U. S.

Speaker 3

Alone is $500,000,000,000 with over 4,200,000,000 ceiling applications in the U. S. Alone. Expected revenue streams from retail and professional segments include product sales, royalties, licensing, subscriptions, monitoring and the sale of global country rights. We continue to utilize our e commerce platform of over 60 websites for lighting and home decor to educate and enhance our market penetration to both retail and professional segments.

Speaker 3

As we've spoken before with you, but it's always important to remind everyone, we just are very, very proud of our Board and our management team. We've got world class experts from world class industries, proven executives and individuals that understand and have made the lighting industry what it is today. And this is really fundamental and I think it's key to any company as we go forward. Our mission, which we've talked about is to continue to make homes and buildings safe and smart and advance as a new standard. And importantly, in the center box, we do 4 things.

Speaker 3

We save lives, we save cost, we save time and simplicity in advance. And many companies have been so successful just doing one of these and yet we have all 4 as part of our products and services that we're offering. And then we've talked about the patents and other parts of our addressable market. We influence many things in many industries, and we talk about the electrical and building and safety regulators, the insurance companies, the lighting industry, smart home industry. And in almost every one of these cases, we significant cost and time savings while enhancing safety.

Speaker 3

And that's really the fundamental theme behind each one of those sectors and why we remain so excited. Financially, as we've talked, our sales continue to grow. You can see from $19,000,000 in Q1 of 2024, dollars 21,400,000 in Q2 of 2024, and then $22,200,000 in Q3 of 2024. So prior to that $11,000,000 raise, we reported our cash and so forth and we anticipate the company will become cash flow positive during 2025. During the past months, we've managed to significant we've managed to really create some huge collaborations with Home Depot, with GE, with Wayfair.

Speaker 3

And then in addition to that, we've got key collaborations with Kichler, world leading lighting company, Gwyzel, Igloo, collaborates from a European leading lighting company. And then finally, RUI, which is the biggest lighting manufacturer in the world. And last but not least, we are working on some significant additional collaborations, which we will plan to announce in the coming months. So a lot going on, we're excited. And with that, let me turn the presentation over to Len Sokolow, our Co CEO.

Speaker 3

Len?

Speaker 4

Thank you, Steve, very much. And I just wanted to reiterate the level of excitement that we have and the fact that not only do we see the future, we're living the future and we've invested and continue to invest in the company because we believe in it a great deal. So just to go through a very high level quickly, just so everyone is very clear on the trend lines here, which we're excited about is our revenues again are up 3% to 22,200,000 dollars Our gross profit is up 4% to $6,800,000 Our gross margin continues to increase by 1% to 30.9%. Our net cash used in operating activities decreased 39% to $2,600,000 And of an interesting note is that our interest bearing debt net of any gross of any debt discount decreased by $3,100,000 during the quarter. So with that, I'd like to turn it over to Ronny Cohen, thank you.

Speaker 1

Thank you, Steve. Thank you, Lenny. Brief overview on business and products. As Steve mentioned, we believe our products will significantly save cost, time and most important, will save lives. And therefore, we strongly believe as you can see in this slide that once we have the entire assortment of products here with us and available, we will get started being recommended by insurance companies.

Speaker 1

The product that we're currently bringing in and in production, all if not most, if not all of them already is as you can see from top right is exit signs, emergency lights, flush mounts, recess lights, and we'll talk about recess lights in a few minutes again. Flush mounts here, we're going to have chandeliers, holiday lights, kids' lights, themes' lights already here. We will have plug and play smart ceiling fans and plug and play ceiling fans and we'll have a variety of assortment of wall sconces. Once we have the entire range of products here and we believe it's the next coming months and even hopefully a lot of this by the end of this year, so really soon, We strongly believe that we can be recommended by insurance companies as a tremendous life saving aspect as Steve mentioned, including reducing fires, reducing ladder falls, the most significant severe injury in homes and reducing electrocutions and much more to come in the future generations with the smoke detectors, CO detectors and emergency lights we already have. So that's quite significant.

Speaker 1

As we said several times, we're conducting the razor and the blade model here when the razor is our the razor is really the ceiling outlet and the blade is everything that's plugging in and we intend to bring here. And everything that we put in ceilings in homes offers intangibility of products you can interchange according to your needs, energy saving or holiday or many other reasons, renovations, buildings and hotels. We also predict we will start shipping builders and hotels as the products arrive early next year. And we can go to a high rise or a large hotel, what will take today probably several good months, if not more, to install light fixtures. We can do this without technology within days.

Speaker 1

So it's not only the life saving aspects, it's the time and money and cost saving are quite significant value proposition we bring to the table. Additionally to everything, we have, as you know, signed a 5 year agreement with GE. We intend to license all the products you see here. It's the plug and play on the left standard for the electrical and lighting industry. Our patented recessed light that we have patents on this, recessed light is a small item, but it's a multi billion unit market that we intend to license and this is a major product that we're waiting and going to open a lot of doors for us because still it's a small product, but still you can spend 20 to 30 minutes on the ladder while installing picture or recess light and therefore we strongly believe that that has a potential, a global potential of licensing.

Speaker 1

We will have the smart generation 2, smart of us for the lighting and the electrical industry. We'll have also for the ceiling fan industry, the plug and play advanced product here and the smart plug and play advanced product. Last but not least, we strongly believe that we can license our generation 3 product once we're in the market and even before due to many aspects that delivers tremendous electronic real estate. If you see the slide, we can offer we enhance performance of all smart home features, maybe an exception of water leak that you probably will prefer to have on the floor and not in the ceiling. But when you talk about Wi Fi, AI chips, AI software, smoke detectors, CO detectors, speakers, microphones, emergency lights, everything we have in our platform and all the smart features will significantly work better.

Speaker 1

Like you can see here, that's what our product does to WiFi. It almost doubles the speed of WiFi just because of the chip in a different location and probably triples, almost triples the range of the Wi Fi and that will be quite significant to smartphone companies, including world leading companies that can utilize our vast patent portfolio to that can enable them to put their software in, their hardware in, but utilize our patents and most important, all the code approvals that we have and the votes by the NEC with the 10 segments, ANSI and NEMA significant votes, the combination with significant enhancement of performance of smart home features in the top center of the ceiling with the vast electronic real estate we have, plus the ANSI, NEMA and NEC votes and NFPA votes offers a great value proposition and this is part of our partnership with General Electric that also merged on licensing together with Dolby and that sounds like a strong proposition and many people in the GE believes that this is really has a lot of value. To remind you, GE created many standards, the most famous standard started with the Edison bulb, but they created a global standard once inventing their Edison base that became a global standard and many in GE believe that we are on the right path based on all the NEC votes, based on hopefully cooperation with insurance companies that we expect to come when the products arrive and many other things that we're doing behind the scenes, including licensing, create a U.

Speaker 1

S. And a global standard like Steve mentioned. On top of all of this, as you recall, our products won 7 consumer electronic awards in the past year or 2. And really the value proposition on a significant market to save lives, but really open the door to 4,200,000,000 residential applications here in the U. S.

Speaker 1

Alone and much more when it comes to commercial. This is the number of outlets that are out there in the U. S. Market alone. It's close to a 1,000,000,000 applications globally.

Speaker 1

We believe it's close to 10,000,000,000 applications. And therefore, we strongly believe with many others that we have a great opportunity in expanding our sales today through our 60 websites during the collaborations we announced with Home Depot, with Wayfair and world leading European lighting company, U. S. Lighting company, Kichler and Quisel and the global largest manufacturer of lighting, we can expand our market penetration and we hope to be in many more homes next year. With that being said, I think we covered quite a lot of ground here today and we're opening now to Q and A.

Speaker 1

So please ask your questions. We're here to answer. Thank you.

Operator

Thank you. We will now begin the question and answers.

Speaker 1

Yes, we have Almas here. I'm going according to the list. So Almas is first from Freedom. And please, Almas, you can ask the question. We're here for you.

Speaker 2

Hi, everyone. Thank you for taking my questions and congrats on the quarter. I have a few questions. Recently, Sky X participated in the Real Deal Miami Real Estate Forum. Could you please provide an update on your collaboration with Builders?

Speaker 1

You're asking regarding the Real Deal with Builders?

Speaker 2

Yes.

Speaker 1

Yes. So as we showed on previously and I'll show it again here on the screen that people still see those screens, we are now in production of all the type of fixtures, most if not all the type of fixtures that builders use today. We are enhancing our market penetration with our ceiling outlet receptacle. And our plan is once we are ready, we can start delivering products after we supply the ceiling receptacles that you can see here. We have a 1 pack, a 4 pack, an 8 pack and a 24 pack.

Speaker 1

As we I just said earlier, this is the razor and the blade model. We are supplying the razors, expect to supply them in the next coming months is starting actually even in this month. We're supplying already every month now and then once we have the full assortment of buildings, I think you will have several announcements here that will cover our great progress with many builders as well as hotel owners. So we're very excited to that stage and production has started and we already have chandeliers and pendants here. We have holiday lights now and we started actually having wall integrated plug and play wall sconces indoor for both indoor and outdoor and we expect to have the exit lights, emergency lights, flush mounts and recess lights.

Speaker 1

It's a multi billion unit market as we mentioned coming soon and that we expect to deliver in the next coming months to many builders. So hopefully that answers your question. And the show was great for us with connections and collaboration.

Speaker 2

And I have the second question. Most of your suppliers are based in China. How do you assess the potential increase in import tariffs? For instance, considering President Trump's statement proposing a 60% tariff on all Chinese goods, how might such change affect your gross profit margin? Additionally, if new tariffs are imposed, do you anticipate being able to negotiate the sharing of these tariff costs with your suppliers?

Speaker 1

So, if we're so first of all, we have factories that we're working with today and the manufacturers we're working today have other factories, because they're thinking about their backups in case there's issues between U. Because they're thinking about their backups in case there's issues between U. S. And China in general. So we're working already with companies in Taiwan and in the Philippines, in addition in Vietnam, excuse me, in Vietnam, in addition to our Chinese manufacturers and several of them already have connections and factories in Vietnam and in Taiwan.

Speaker 1

So with this, I think we're well protected. I don't want to go to politics. There's no President coming here and many people say he's using it more for threats, but I really this is in case he doesn't, we have our backup factories and that's the most important. And then so that answered both questions?

Speaker 2

Yes. Okay. Thank you. Congrats on the quarter.

Speaker 1

Thank you. And I think next is Jerry from ROTH Capital, Jerry Sweeney. Hi, Jerry. Please ask your questions. We're all here today.

Speaker 2

Hey,

Speaker 5

Ronnie. Ronnie, Len, Steve, thanks for taking my call. I had a couple of questions, but specifically collaborations Home Depot, Wayfair, have in particular Home Depot, have they given you a schedule for the rollout of the products into the stores and as well as connecting them onto the web? I know there are some products on the web, but I think they're going to add more and more products to some of theirs as well. Curious if they've given you any type of schedule as to how that's going to roll out?

Speaker 1

So, we actually already rolled up started rolling up to some stores, I think over 100 at that point.

Speaker 5

Yes.

Speaker 1

We have already in the website some products, but this is really the good news and the bad news. The good news is we started rolling in, but the bad news is only 3%, but this is really the good news because we have started production and products are arriving the country now and we expect to start rolling them into online and after you enter online, you can get more access to stores when it comes to Home Depot and with Wayfair, it's online always. Something else to mention that the numbers show we own also 60 websites and e commerce today is taking over more and more business and as compared to retail stores. So it's a growing business and for us to be in both sides of the aisle actually serve us very well from that perspective. So we're just in the beginning and product is arriving now on a monthly base.

Speaker 1

We're getting containers and containers and we're going to load more and more products into our 60 websites, many of them into the expect to also load in more products to both Home Depot, Wayfair and other collaborations that we're working on.

Speaker 5

Got it. So just to be clear, as you ramp up production, you have more product, more product websites, more product on the website, more into the actual stores as well. Is that right?

Speaker 1

That's our expectation to as we grow online to also grow parallel in stores and that's what this is why we have backup from the biggest manufacturers to start rolling up those programs to both online and retail as we come with more product.

Speaker 5

Got it. And I call it Gen 3, the platform with the Wi Fi, lighting, etcetera.

Speaker 2

Is that

Speaker 5

in production? And if not, what's the timeline for that to hit production?

Speaker 1

We're in final stages and just clearing out all the safety aspects between UL and FCC and smoke detector UL and electronics UL and electrical. So fine tuning before

Speaker 2

we go to mass production, we expect mass

Speaker 1

production to start in the next we expect mass production to start in the next coming months, maybe as early as next month, maybe a month after, we just here like we did with Gen 2 of the smart are acting responsible. We do not want to start production until we don't clear 100% of all the safety, not even 99%. And this is very important with smart electronics. As you know, electronics always have a small ratio of defect and we're trying to minimize it to the minimum of the minimum, especially that we're launching a new product. So we're in good space, in good shape with this and we expect to start rolling very soon with that product.

Speaker 5

Obviously, I mean, you've touched upon some of your remarks about the opportunity with Gen 3 and licensing it, for a whole host of opportunities within the home. At what point can you start to go down that path of even just discussions with people licensing some of the real estate that you're creating? And would that be you or is that more the GE sort of collaboration?

Speaker 1

That will be more the GE collaboration. That's the expertise. GE created so many standards in so many industries. I think we just showed probably the most famous standard they created globally was the Edison base that we're showing now again on the screen. But since then GE created an electrical and electrical plants and in aviation and medical equipment, many standards.

Speaker 1

I always like to say there's a standard that all of us on this call and I think every American is using on a daily basis. It's a GE standard that many people do not know they created, but it's called LED phosphor. Every time you open a computer or a TV or a MacBook or iPad or any laptop, you have on the screen the technology LED phosphor and as long as you bought it from one of the 24 largest electronic companies, including Samsung or Apple or Dell, you will and in the past 7 years, you will have the product there. So GE has an expertise to create standards and they have a strong belief that we have a very strong case based on vast electronic real estate and the ceiling that the ceiling enhances performance of every product, not only light fixtures and Wi Fi, but AI and other smart chips as well as smoke detectors, CO detectors and the technology we have with the strong patents compelled with combined with the NEC and NFPA and CNEMA votes is a very compelling value proposition that many of the biggest companies in the world have their own software, have their own hardware, but they want to enhance performance and they probably want to enjoy better performance on their product and our patents give us a lot of strength in the top center of the ceiling And with the votes we have with ANSI, NIMA, NEC is a tremendous value proposition according to many, including GE, including Khadija Mustafa that joined us from Microsoft.

Speaker 1

That's really the main reason she believes that this is a game changing product. And Khadija spoke on the last call or one before and she'll probably join us on the annual call as well.

Speaker 5

Got you. And then just one quick more follow-up question. Just the NAC mandatory opportunity, any updates? I know that's a voting process, but just curious if there's been any updates or any move forward on that front?

Speaker 1

We're still in the process. As we said, it's a very lengthy process. I think we're that's the good news. The bad news is we're 13 years, but also the good news. But we're getting all kinds of additional documentations and all kinds of other hurdles that we need to overcome and submitting more stuff and our team is continuing their efforts.

Speaker 1

And as we mentioned, we're also started to discuss based on some things that took place recently, where we started discussions regarding insurance recommendation to our products and some data that we got during this code process, a part of our efforts there are helping us on this angle. So we know we strongly believe that will happen one day, but the timing is as we know is not it's not a fast process, but we're working and we hope to have surprises on timing, but it's not a short process. It could take time, but we're progressing and are in process as well with insurance companies and we hope that we have some data that will help us significantly help us to enhance things we're doing here.

Speaker 5

Got you. I appreciate it. I'll jump back in line. Thank you.

Speaker 1

Okay. Next question we have here Pat McCann, Noble Capital and then we have Jack from Maxim Group. So please, Patrick, the microphone is here. Hey, guys.

Speaker 6

Good afternoon. Thanks for taking my questions. I just wanted to touch on the insurance recommendation issue. I was wondering if you could expand a little bit on what that would look like from the consumer's point of view. I guess what I initially think of is when you get a home security system like ADT typically can get a discount on your insurance premiums, your home insurance or something along those lines.

Speaker 6

Is that sort of what it would look like?

Speaker 5

Could you just talk a

Speaker 6

little bit more about what we should envision?

Speaker 1

So as Steve mentioned here and we mentioned too, our product significantly, we believe reduces fires, reduces ladder falls, the major significant issue and hazard in homes and significantly reduces electrocution and being electrocuted in the ladder is worse than being electrocuted on floor. So those safety aspects come with generation 1 and 2 already has an emergency light and generation 3 that's not in production yet will have much more. So our discussions are based on the few phases, but the value proposition for insurance companies is definitely there. And as Steve mentioned, we believe we can save insurance companies many 1,000,000,000 of dollars on an annual base and it's going to come through recommendations or discounts or we didn't finalize all the stuff. We're waiting for all the variety and range of products to arrive.

Speaker 1

What's the good news? They started arriving last month and are arriving this month and the next coming months. Every month, we're going to have more and more products and we expect to have the entire range within a month or 2. And I think that that's going to enhance those discussions. They really want to see that we have enough product in enough places And that's as you can see we're working on.

Speaker 1

And once we show this product and there's the accessibility and availability, we expect them to start encouraging the use here because there's a tremendous dollar saving for them.

Speaker 6

Thanks for that. And then the other question I had is I wanted to double down on the Home Depot question. And just I guess what I'm wondering is in the first handful of months here, you mentioned that you're in 100 stores now roughly. But I think you had also previously mentioned how the Home Depot would sort of look at the popularity or the success of your products on the website and allow that to sort of inform what decisions they make as far as how which products they bring into stores, etcetera. I'm wondering, have there been any surprises as far as like which products have been having the most success with Home Depot and what they want to bring into stores in the future, any granularity there?

Speaker 1

So as we call it the razor and the blade model, we're currently mostly, we don't have the variety of product yet in the stores. So everything you see on this slide that I'm showing again is not in stores yet or maybe 1% of what you see here, if at all, I think actually most of them not at stores at all yet. So as we start getting all those products in stores, there's going to generate a program and there's going to be marketing around it and we're going to have much better understanding on what products and what colors work better and that will help to determine what can happen with each product. So this is we started with the razors here what we call our receptacles, but since there's not the blades did not arrive yet, we don't know which products and how are they going to perform. We have an indication for our website, so we know what to bring and what to show because that helps us a lot to understand.

Speaker 1

But we're specifically now that's part of our collaborations, landing products that we expect very soon that you can see on our websites and as well as Home Depot and Wayfair and other websites. And at that point, very soon hopefully, we'll start determining what products have potential to a major expansion.

Speaker 6

Great. Much appreciated. I'll hand the floor over.

Speaker 1

Okay. I believe Jack.

Speaker 7

Hey, Ronnie. Can you hear me okay?

Speaker 1

Yes. Hi. Okay. Yes, we hear you fine.

Speaker 7

Thanks for the update. A lot of my questions were taken. So I do want to just touch on the homebuilder channel. You've announced a Florida order to supply over 1,000 homes. Just wondering if you could provide any update color on expectations for this channel.

Speaker 7

Are you getting more orders inbound? How do you expect those orders to ramp just in that homebuilder channel? That'd be helpful.

Speaker 1

Yes, great question. We met with the builder recently and it looks like we will start supplying very early in the year, their permit and delays and all kinds of the fun stuff that builders go through and that's part of our razor and the blade model. Sometimes we can grow our penetration with our what we call razors here, But until the product hits the market, it takes more time. So we expect based on discussions we have to start supplying early next year. So that's what the builder really signed.

Speaker 1

And yes, we are in discussions with several major players, a I said it earlier, you can go to a high rise today to install smart homes or light fixtures will take you months, sometimes can take you 6 months to hear. When our products, once you have the receptacles installed, the ceiling outlet, it can take days. So there's a significant cost saving and installation, obviously time saving as well as we can supply replacement items that if something happens to a recessed light or emergency light, what often happens with builders, they don't need to call an electrician. They have their maintenance guy go and plug and play. So there's many advantages and there's significant interest.

Speaker 1

We're talking to CEOs of major companies and key people and world leading companies that we're talking to and we just are focused and to deliver our products here. And once we do, I think you will have a lot to say on who and what products we're collaborating on.

Speaker 7

Okay, fantastic. And then just real quick, I just want to touch on there's some discussion around international manufacturing and sort of tariffs and stuff. But I just want to touch on just your the relationship you have specifically with RUI. How is that going? Are they actively up and running now?

Speaker 7

And just how is that relationship panning out? And that's it for me. Thanks.

Speaker 1

Yes. Thank you for the question. Yes, Rui actually is in production now and we believe even starting to ship very, very soon. We actually started getting some products here. So we are he is in production and that's expanding every day now and we believe there's going to be much more production coming from their end.

Speaker 1

So everything is going according to plan and the chart I showed you earlier, a lot of those fixtures are going to start landing very soon and some of them already landed based on our partnerships with Rui and other relationships we have. Jack, does that answer your question or any other question?

Speaker 7

That's it for me. That's it for me. I appreciate that answers my questions.

Speaker 1

Okay. Thank you. Thank you, everyone. Very much appreciate your time here. And thank you, Steve, and thank you, Lenny.

Speaker 1

And I see here that let me see. Oh, there is another question here that I can see. It's Paul Cooney from Benchmark. Please, Paul, welcome. You can ask your microphone is yours.

Speaker 8

Hey, thanks a lot, Ronnie, for taking my call. Hey, just wondering, you said like you're in total production now of the Sky plugs. Is most of the production with the smarter version or with the planned version? And if it's the planned version, how far off are we from the smart version?

Speaker 1

So we're producing now parallel both. We have inventory and producing both the standard and the smart. Obviously, the smart is a much more expensive item and not every recent slate or exit sign would like to have a smart product. So it's on the high end products such as ceiling fans and chandeliers that we see this interest because the smart can cost more than a product. But what we have what we expect to have also and it reminds us that once the reset light arrives here, you can group those reset lights and put many of them on one smart board.

Speaker 1

So the smart is growing, but the numbers of the standard are much higher and expected to be higher. But the good news is that we're putting as we sell product, we're putting and deliver product, we're putting the razors on the ceiling and then people can upgrade down the road and especially we come with generation 3 that offers many safety and necessities to homes from safety and from lifestyle, including high speed Internet that's going to be much faster. So you can still plug in a standard or a smart fixture into the platform. So we're growing up with both of them, but obviously the advanced plug is the standard one has much more potential because of wall sconces and recess light and exit signs and emergency lights that also can be smart. And by the way, there are discussions already with companies that want to have the exit signs and emergency lights become smart.

Speaker 1

And this is really not a big change for us. So there are companies that's a very important thing for us. But still, we anticipate majority at least 2 thirds to be the advanced standard plug and play and probably a third to be a smart down the road. But those are rough estimates as we start production with GENERATE 3. Generation 3 will fine tune and understand the numbers better.

Speaker 1

All right. Thank you. Okay. We see that there is no more questions. So thank you again everyone.

Speaker 1

It was great presenting and hopefully our next call we'll continue our growth here and some more things to announce and cover. Thank you very much everyone, Steve, Lenny and thank you.

Operator

The conference has now concluded. Thank you for attending today's presentation and you may now disconnect.

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Earnings Conference Call
SKYX Platforms Q3 2024
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