Ethernity Networks PLC (LON:ENET) shares rose on Wednesday after the Internet hardware specialist said it expects to start generating cash from 2020 as momentum builds for its new generation of modules.
Ethernity’s technology helps servers run much faster through the efficient 'offloading' and rerouting of internet traffic.
Last year, it signed the first deals for its new SmartNIC-based product in Korea and North America.
Revenues were higher in the second half of 2018 over the same period in 2017 due to an increase in activities around these licensing deals, Ethernity said today.
“This trend has continued into the first quarter of 2019, with revenues materially surpassing the same period of 2018. In 2020 the company anticipates commencing the generation of cash flow from trading operations during the second half of the year.”
David Levi, Ethernity's chief executive, said there were also discussions underway that will allow for 'multiple times' growth in 2020 as operators work through testing phases and reach mass deployment.
The group's revenues in 2018 eased slightly to US$1.1mln (US$1.5mln), while losses came in at US$2.55mln (US$159,000 profit). Net cash at the year-end was US$8.5mln.
"The second half of the year saw a major change in securing lucrative technology licensing deals with Tier1's that will generate ongoing recurrent revenue in the years to come, said the statement.
In afternoon trading, shares in Ethernity were 7.8% higher at 27.50p.
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