It hasn't been a great start to trading after the Christmas break for shareholders of Audio Pixels Holdings Ltd (ASX: AKP).
Its shares fell as much as 34% to $12.70 today after the Israel-based digital speaker developer provided the market with an update.
Earlier this year the company started to make plans for the mass production of its first generation high performance micro-electromechanical structures (MEMS)-based loudspeaker chip.
The impressive piece of technology generates sound waves using MEMS encased in just a small chip not more than a millimetre wide.
However, this morning the company hit a stumbling block. Following the completion of its MEMS‐ASIC integration stage, Audio Pixels reported that the overall product performance didn't reach certain critical objectives required for its commercialised product.
According to the release the first batch of MEMS devices it received from the fabricator deviated from the required voltage specifications. As a result the higher voltage required to activate the MEMS transducers has proven to be beyond the drive capabilities of its ASIC controller.
Audio Pixels has identified the root cause for the voltage gap and modified the design accordingly. Management intends to update the market in due course with its new timelines.
Clearly this is a blow for the company and I can't say I'm surprised to see its share price plummet today. Prior to today Audio Pixels had a market cap of $520 million based on this unproven technology.
One day it may well prove itself, but until then I would suggest investors give it a wide berth. Instead I would suggest an investment in exciting tech companies such as Altium Limited (ASX: ALU) or Aconex Ltd (ASX: ACX).
