|UPEK, Inc. Asks Key Business Questions Important to Stockholders That Must Be Addressed by AuthenTec Management|
|Thursday, 18 February 2010 00:00|
UPEK, Inc., a stockholder of AuthenTec, Inc., is publicly asking AuthenTec management to comment specifically about the business on today’s earnings call and answer key questions as to whether design losses and other potential impacts have occurred to its business.
On September 7, 2008, AuthenTec announced: “AuthenTec has been notified by a significant PC customer that it does not presently plan to use AuthenTec’s fingerprint sensors in its next design cycle in late 2009.” It appears that the news of this business loss resulted in a significant reduction in AuthenTec’s stock price, from which there has been little improvement in over 17 months since that announcement. As an industry participant, UPEK believes that AuthenTec has additionally lost the majority of the business from a second significant PC customer, primarily because UPEK is, and has been, the beneficiary of this business with this significant PC customer. UPEK believes this presumed second loss is material to AuthenTec’s business, but has never been publicly reported by AuthenTec.
UPEK believes that the impact of these two design cycle losses on AuthenTec’s PC business will begin with the industry transition from the previous generation Intel platform codenamed “Montevina” to the new Intel platform codenamed “Calpella”. This transition from Montevina to Calpella is underway at present, and is expected to be substantially complete by the end of the second quarter of 2010. Consequently, UPEK believes that while the substantial design losses with their two most significant PC customers did not adversely impact AuthenTec’s 2009 revenue, it is very likely to have an adverse and significant impact on AuthenTec’s revenue for 2010 and subsequent periods.
Given the potentially substantial impact to AuthenTec’s 2010 and later revenue that losses at two significant PC customers would represent, UPEK requests that AuthenTec’s management publicly answer in detail the following questions for the benefit of the AuthenTec stockholders:
Having clear and appropriate detail about AuthenTec’s business is critical for stockholders to assess their investment and make choices about options at any upcoming stockholder meeting.