https://seekingalpha.com/article/4220719-luna-innovations-inc-luna-ceo-scott-graeff-q3-2018-results-earnings-call-transcript?part=single
(MY NOTE: I wasn't able to participate in the LUNA INNOVATIONS 3rd Quarter conference call, but there was some interesting information shared about progress in the terahertz division, and some great questions by an unidentified participant. The Company is "hitting on all cylinders" and gave some really strong guidance for the 4th Quarter which is posted at the bottom of the page. As always perform your own due diligence. )
Scott Graeff
Our Terahertz division is continuing the strong momentum built in Q1 and Q2 with a 55% increase in products revenue in Q3 year-over-year. We continued with our strategy of enhancing market presence and sales channel expansion with the addition of two new value-added resellers. These additions accelerated our sales and marketing efforts to deliver innovative Terahertz products into new process control market opportunities in Korea and Taiwan. In the third quarter, we successfully deployed the higher performing Terahertz gauge developed in Q2 into new process control and non-destructive testing applications. This new gauge will meet the demand for measurement of thinner and buried layers. These more demanding process control and non-destructive testing applications are driving demand for accurate process control with high repeatability at a continuously growing rate.
Unidentified Analyst
Congratulations on a nice quarter. I just want to -- had two questions. Number one, you mentioned the additional process control business coming out of the Terahertz division. Could you elaborate just a little bit on when you talk about process control, what is it that your customer is actually doing? And then what is that taking the place of, what were they doing before and is there a definitive cost benefit ratio to them?
Scott Graeff
The Terahertz system in getting the new gauge out there, it's measuring thickness several layers deep, that's why I talked about embedded layers or several layers down in measuring. Typically, historically ultrasound or using some kind of radioactive technology and we are replacing that with more efficiency and effectiveness. So but you can imagine anything, whether it be tires or any material that has relevant several layers to it, us being able to measure a layer that is several layers down below the surface is critical for a lot of our customers.
Unidentified Analyst
These are multiple material opportunities?
Scott Graeff
Yes.
Dale Messick
Think about blowing film, plastic packaging kind of applications and how widespread that is and that's a target environment that we're currently pursuing in and getting some success with.
Unidentified Analyst
So the last part of that question was the cost benefit analysis ratio, obviously these people have put it through the paces and determined that they want to deploy it, what is the payback to them? Is there such thing as ROI in this area?
Scott Graeff
Yes, I think I what they look at is, as you can imagine, if you're, whether it be water bottles, shampoo bottles, a lot of those things they don't want it any thicker than it needs to be, but it needs to be thick enough such to not have leaks and things like that. So their benefit is to get a precise measurement to have that bottle or that substance specifically thick enough and not too thick. So there is a major return from a customer.
Unidentified Analyst
And that would be globally, there's nothing specific about Japan or regulators deployed?
Scott Graeff
Yes, remember, this is in real time on a line, so it's embedded into someone's manufacturing line to give real time feedback on that thickness of that specific product.
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Scott Graeff
One last item I'll cover, is an outlook for the remainder of the year. As you know, we do not typically give financial guidance. But because of the proximity to year-end and the various transactions we've done this year, we'd like to provide an outlook range. We are not committing to providing guidance in the future, but we will continue to regularly evaluate which disclosures makes the most sense. We expect fourth quarter 2018 revenues to be in the range of $12 million to $12.5 million. We expect full-year 2018 revenues to be in the range of $41.5 million to $42 million. This would give us EPS in a range of breakeven to $0.01 per diluted share for the fourth quarter of fiscal 2018. And for the full fiscal 2018, we would expect EPS in a range of $0.31 to $0.32 per diluted share.
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