Enovix Corp (NASDAQ: ENVX) opened about 20% up on Tuesday after signing an agreement to provide silicon batteries for a mixed-reality headset.
Shares of the battery manufacturer are now trading at a year-to-date high.
Who did Enovix teamed up with on mixed-reality headsets?
Enovix has inked an agreement with a top California-based technology company. It did not, however, reveal the name of the firm it has teamed up with on mixed-reality headset in a press release today.
The Nasdaq-listed firm will immediately receive a one-time payment for “tooling to support battery pack dimensions”. Subsequent payments will be made on delivery of sample and production quantities.
Note that a mixed-reality headset requires materially better battery technology than an average smartphone.
Enovix stock has close to tripled over the past two months but it does not pay a dividend at writing.
Here’s why the news is meaningful for Enovix stock
The news is significant for Enovix shares as IDC forecast global shipments of mixed-reality headsets to jump from under 10 million units this year to more than 35 million units by 2028.
The $2.5 billion company based out of California, United States started manufacturing its EX-1M silicon battery samples at its facility in Malaysia this month. Samira Naraghi – the senior vice president of Enovix said in a press release today:
Devices in this market [mixed-reality headsets] need to be light, fashionable, and safe while also supporting always-on immersive experiences that leverage AI. Our high energy density batteries are uniquely suited to this task.
Wall Street currently has a consensus “buy” rating on Enovix stock. Analysts on average see upside in it to over $27 that signals potential for another 40% gain from here.
Enovix Corp had a strong fiscal first quarter
On Tuesday, Raj Talluri – the chief executive of Enovix also touted his company’s acquisition of Routejade that he’s convinced will help it succeed in adjacent markets including the Internet of Things (IoT).
In May, the battery company reported $5.3 million in revenue for its first financial quarter that topped Street estimates by some $1.52 million. ENVX also narrowed its net loss in Q1 to $46.37 million versus analysts at $48.17 million. At the time, the Nasdaq-listed firm told shareholders:
Looking forward, we’re approaching key milestones on our Journey to Scale in Q2 of 2024 with production beginning in Fab2 and the first EX-1M samples being shipped to customers.
ENVX expects up to $4.0 million in revenue in its current financial quarter on 22 cents to 28 cents of adjusted per-share loss. Enovix stock traded at a high of $36 during the pandemic.
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