Hey mate,

I think that any sort of backwards looking analysis will be very difficult with a business like AMX. The business is drastically changing and any assessment of value today has to be made on where the business will be, not where it was.

Not to say historical financials don't have any value but work into the evolving product set and market are more important I think.

@thebehavioralinvestor "Not interested in a cash incinerator." Neither is the market unfortunately!

However it is worth looking at cash incineration with the perspective of the economics of the 3D segment. Right now, it is sold on a licence basis. It may move to a subscription model in time but that requires consistent demand which isn't there for 3D yet.

So right now the model is AMX spends ~$300-500k to capture a city. Cost varies on size (m2) and scale (2 v 5cm) but usually somewhere in that range. So far publicly disclosed licence sales are $250k for the San Francisco model so the payback on capture is relatively quick. Of course the beauty is anything above that payback is effectively 100% margin on your cost of sales, just look at the recent announcement of the $2.5m sale to the Fed Gov for datasets, the EBITDA guidance shifted up the full $2.5m. There is no incremental cost to deliver the licence, the capture has already happened (from an accounting point of view it is amortising through the P&L but let's just talk cash economics for now).

My point is a business like this can very quickly go from cash incinerator to cash generator, much faster than a normal operating business that has a cost of servicing incremental revenue. Bear in mind I don't expect that to happen quickly, AMX are still capturing new cities in the US (I saw on LinkedIn San Diego just announced) and demand is still in its infancy. An investment today is an extremely risky one and I won't pretend otherwise, but on my assessment the risk/reward is extremely interesting given the economics described above if you think the 3D space will take off in the coming years.

I don't think there are many. Accucities (https://www.accucities.com/) appear to be the closest given they capture up front and then sell models. Otherwise most appear to be contract/consultant based. I also keep an eye on NEA in general but they are doing stuff in 3D even though it isn't a direct competitor.

I think AMX has a nice first movers advantage but that can quickly be eroded. Part of the reason for burning cash now too.