Second engine igniting off the first: an unplanned-for adjacent revenue stream has started paying, and management is now
The model's full reasoning — Q4 2022 call → NOWe need to determine if management describes a second, distinct way of making money that emerged from existing operations, is already generating real paying business, and is being deliberately grown. Looking at the transcript, there is discussion of "Impinj authenticity" - a solution engine for cryptographic product authentication. Jeff Dossett says: "I'm very encouraged by the growing level of interest among our solution partners and an increasing number of enterprise end customers who are guiding Impinj authenticity solution engine. Recall that it's an innovative differentiated Impinj platform solution engine that delivers cryptographic product authentication that protects brands and consumers. The pipeline is growing nicely. Of course, the time and pacing -- or the pace and timing of those opportunities is challenging to predict. But I am even more optimistic today than when we had this conversation last quarter regarding the opportunity not only to build endpoint IC recurring revenue, but also to establish a new services revenue opportunity in the longer term." Chris Diorio adds: "think about any technology. It does matter of [indiscernible] think of any early successful technology that hasn't rolled out security, you'd be hard-pressed to find one. And here, we're the first ones to truly launch and endpoint IC design for broad-based adoption that has a cryptographic engine and the key in it. And that cryptographic engine and the key allows us to authenticate the item to which the IC is attached. We believe that capability for the future will be essential and that at some point in the distant future, as you know, because we get better and better at doing this, there will be a key in every single IC, there needs to be. It’s just how technology goes. So, we're excited about where we stand today. We're excited about our pipeline, and I personally I'm excited about the long-term opportunities, not just a year or two out, but further out in time as well." Later, Cary Baker says: "And Scott, unfortunately, my answer on the authentication model is going to be roughly similar. It's a little too early to model authentication revenue in 2023. We are shipping or we will ship units on our endpoint IC authentic and extreme endpoint IC some as early as Q1, but very small quantities at this stage. So it won't really hit the radar.
| Ticker | Company | Call | Date | Call grade |
|---|---|---|---|---|
| M | Macy's, Inc. | Q4 2022 | 2023-03-02 | D |
| CMLS | Cumulus Media Inc. | Q3 2022 | 2022-10-28 | D |
| GDRX | GoodRx Holdings, Inc. | Q2 2022 | 2022-08-08 | F |
| SOPH | SOPHiA GENETICS SA | Q4 2021 | 2022-03-15 | C |
| SLQT | SelectQuote, Inc. | Q2 2022 | 2022-02-07 | F |
| LC | LendingClub Corporation | Q4 2021 | 2022-01-26 | A |
| IRBT | iRobot Corporation | Q3 2021 | 2021-10-28 | D |
| T | AT&T Inc. | Q3 2018 | 2018-10-24 | C+ |
| LRN | Stride, Inc. | Q1 2019 | 2018-10-23 | B |
| MITK | Mitek Systems, Inc. | Q4 2017 | 2017-11-07 | C+ |
| IONS | Ionis Pharmaceuticals, Inc. | Q1 2017 | 2017-05-09 | C |
LRN · Q1 2019 → YESThe question is: Does management describe a SECOND, DISTINCT WAY OF MAKING MONEY that has recently emerged FROM the company's existing operations, assets, customers, or capabilities - an additional re...YES The transcript shows career readiness as a distinct second revenue avenue that emerged directly from the existing MPS business: students already enrolled in Managed Public Schools are being moved into career readiness programs (over 5,000 students), and the initiative is built on the same platform, curriculum, and student base. Management explicitly describes it as a “career readiness line of business” and “robust career readiness business” that is already generating paying enrollments today while they are deliberately investing resources—dedicated executives, reallocation of funds, and plans to drive a major portion of next year’s enrollment growth.
M · Q4 2022 → YESThe question is: Does management describe a SECOND, DISTINCT WAY OF MAKING MONEY that has recently emerged FROM the company's existing operations, assets, customers, or capabilities - an additional re...YES The transcript shows that Macy’s Marketplace is explicitly described as a distinct new revenue avenue that emerged directly from their existing e-commerce operations and customer base (macys.com, cross-shoppers, and omnichannel platform). Jeff Gennette states it “captures incremental sales opportunity,” “drives a larger average order value,” “allows us to quickly move into new and adjacent categories without inventory risk,” and “attracts a new younger customer,” while management is actively scaling it by adding 2,000 brands in 2023 and launching Bloomingdale’s marketplace in the back half.
GDRX · Q2 2022 → YESThe question is: Does management describe a SECOND, DISTINCT WAY OF MAKING MONEY that has recently emerged FROM the company's existing operations, assets, customers, or capabilities - an additional re...YES The transcript shows that Pharma Manufacturer Solutions is the second distinct revenue avenue that emerged from GoodRx’s existing operations. Trevor explicitly states: “Our distinct ability to reach both consumers and providers continues to be recognized by manufacturers as evidenced by the strong growth.” This capability originated from the core prescription-transactions platform and user base 3 years earlier (when other offerings were only ~5% of revenue). In Q2 2022 it generated $26.6 million (102% YoY growth) and is already producing real paying business.