Nice something for nothing on a Friday.

Look forward to seeing more details.

#betterthanakickintheteeth.

Love it @topowl .

Interesting that AVA tend to through out announcements on Friday and sometimes after the market closes ???

Wooo! For once the market actually likes it.

I agree I would like to see more info on the financials - it seems like this should be relatively high margin as it will be more software/AI training than a hardware, but I can also imagine they may be giving very favourable rates to get this across the line...

Could it be possible that for a big contract they will need to invest to scale up to deliver? I'm not sure how capital intensive the business is, but in my experience landing a large contract requires some uplift in product and services to deliver on time and be fit for purpose. I'm interested to see what the follow up announcement will be.

@actionman Yes, I'm a little nervous about this announcement for this reason.

From what we are given, it doesn't seem like it would be capitally intensive on plant and equipment (and AVA have a history of outsourcing this if need be (e.g IMOD contract)).

However it could require more staff or, of greatest concern, a lot of involvement of key/senior people and therefore less focus on other contracts/projects/R&D

It's happened more than once that landing a big contract has been the downfall of a company - not suggesting it is that dire in this case but worth bearing in mind.

Personally, I have been involved multiple times working for small software companies where big contracts (sometimes at overly favourable rates) have just sucked in resources causing a slow down in most other parts of the business - and in hindsight the big bet wasn't worth it.

The fact that this was 10 months in the making does mean there may be some sunk cost fallacy from the AVA side (In my experience, the big players are often well aware of this an will use it to negotiate hard on the deal)

This is all speculation though - getting some idea of the financials will help a lot, and I think mostly likely positive for the business. But I will be bearing all of the above in mind.

I think they're raising.

They'll need to resource up to deliver on this, they've got a little debt also, so why not clean up the balance sheet with a cap raise and put some extra dollars in the bank.

Just my opinion. Let's see.

Apparently it's not a raise. They're going to provide "further details in relation to a material contract". Presumably about the Telstra contract?

Not necessarily good news, but probably not bad is my guess.

[Edit: I should have provided the link]

Good!

Perhaps unwise to make a price-sensitive announcement without providing any hard facts. But maybe the only substance is that they are a "preferred supplier". This doesn't mean much if the contract doesn't involve any commitments. (e.g., Ferrari are my preferred supplier of supercars.)

It is tricky, because you can give management credit for ensuring that all shareholders have equal access to that information. So its a bit damned if you do and damned if you don't.

For sure, it there isn't any tangible followup in the next reporting period, you'd expect any SP bump to unwind.

Disc: Held in RL but not yet in SM. $AVA has been at the top of my microcap watchlist for a while, and this morning I re-initiated a small RL position because of the potential of this as discussed by others. I've been teetering on the brink for a while, and as you can see in my SM history I have been in and out recently ... cold feet, and needed capital elsewhere.

Lols at "Ferrari are my preferred supplier of supercars".