FLIR Security Business Struggling

Author: Brian Karas, Published on Aug 02, 2017

FLIR's security division is an ambitious mix of FLIR's core thermal business plus multiple acquisitions, including of retail / consumer offering Lorex, enterprise DVTel and camera startup ISD.

Right now, it is struggling.

In this note, we examine FLIR's financial results for the security division, share feedback from FLIR management and examine FLIR's future.

****'* ******** ******** ** ** ********* *** ** ****'* **** thermal ******** **** ******** ************, ********* ******** / ******** ******** *****,********** ************** ******* ***.

***** ***, ** ** **********.

** **** ****, ** ******* ****'* ********* ******* *** *** security ********, ***** ******** **** **** ********** *** ******* ****'* future.

[***************]

Q2 ******** *******

****'* ******** ******** **** ** ****** *** ** ******* ** Q2 ****, ******* **%, ********* * **** **'* **** *%. Q2 ******** ******* *** $**.**, **** **% **** ****'* $**.**, and ****** **** ******'* $**.**.

******** **** ****'* ** ******** ****, **** ******* *** ********* ********** ** *** *****-******* ******** sold ** ********* ******* ****** *******:

*** ******* *********** ********* ** *** ****** *******, *** ****** in ****** *** ***** ********. *******, ******** ***** *** ***** orders ** ********, ******* ***** **** **** ~$***, ***** **** ~14%

**** **** **** **** ** *** * ******* **** ******** in *** ******** ******** (******* *******, ******/*****, ***/******* **** ******* ADI, *** **********/****** ***** ********) **** *** ******* ******** ****** strong ******.

Security **** ******* *********

** ******** **** *** ******* ******** ** ***** ****'* ******* segment ** *** ******** ********, ************ ~**% ** ***** *******. Another **-**% ***** **** *** ***** ****** *******, *** *** similar ********** ******* ** **** *** **** ******* ************ ******** like ***. *** *********, *** ****** **** **** **% ** overall *******, ** *** ***** ******* ****.

Thermal ********** ******

*** ********* **** ** ****'* ******** ******** ** *** **** thermal ****** ********. ***** ******** *** ***** **** ** ******** infrastructure ************, *** ** ***** ********* ***** ***** ** *** always *** *** *********** ******. ** **** ******, **** *** deep ********* ** **** ******* *** ***** *****, ***** ********* in **** ******* ***** ******. *****, *** ******* ****** **** new ******* ******** **** ************* **** ********* *** ******* ********* pressure ** *** ******* *******.

Lorex **********

***** ** ** *** ****** ** *** **** ** *** bottom. **** ** *** ******* **** *********** ***** ********, ******* ****'* ****** ******* **** ** ********* ** ******* with * ********* ** ***** ***** ***'* **** *-***, ** other ******* ******** **** ****** *** ******* **** *** ****** available ** ******, ** **** ********* ***** ** ******, **** Depot, *** ***** ******.

** ******* **** ** ***** ******, **** *** ***** ** cameras ** *** ***** ****, *** ************** * "****-****" ********** *** ******* **** ******** ******* ************ *** ***** ** other ********, ****** **** * **** ******** ********. ** ***** that **** ****** ***** ******* ***** **** **** *************** **** other *** *******.

**** **** ****** **** **** *** ******* ** *** **** stability ** *** ******* **** *** ****** ******** ** ****** out *** "*********" ** *** ***** ****, ***** *** ***** their ********* ******* ******* *************, ** **** ******* ******.

DVTel *********** **********

*****, ******** *.* ***** ***, ** ***** *** ************* ****** *****. ******* ** **** segment *** **** ****** ****, ********* ** ****. ****** *** company ******** ******* *.* ** *** ***** "********" *** ******* this ****, *** ******* **** *** *** **** *** ***** improvements **** *** ** ***** **** **** ** ********* **** competitors.

**** ***** ************ ***** *** ***** ******** ** *** ******** call, ****'* *** *** ****** ********* ********* ** **** ******* of *** ******** ********, ******* ******* ***** *** ******* ******** growth:

**** ********** ** *** ******** ******* **** **** ************ **** FLIR's******** ******* *** ******* ********, ***** ** ********* **** ** ***** ******** ********. ***** this ******** *** ******* *******, ** **** *** **** ******** revenue.

ISD ** ***** *******

**** **** *** *** **** ** "******** *******" ** ****-********** thermal *******, **** ** ***** *** ******* ******* ** ******** in ** ****. ***** **** ** * **** **** *** the ******* ********, ** ** ************* ******** ** *** ***** Security ******** *****, ************ *** ***** *******, ***** ***** ******* from **** ******** ******* *** ****** ******* ** **** ** competitive **** ***** ***-**-*** ********* **** ********.

**** ******** *** ** ****,******* *** *********** ** ** ****'* ******** ******** ****** ***** **********, ************ **** ***** *******:

**** *** ***** ** *******/******** ****** ** **** ******* ******* over *** *****, ***** *** *** **** ** ****** ******** on, ***** ***** ************.

Out ** ****

**** ********* **** *** ******* *** ** ****, ******* ** a "***** ****", ****** ******* **** **** ***** ******** ***** **** ** ** *********. **** ***** ******* ** exhibit ** *** ****, *** *** *** ******* * ******** about ********** ** **** ****.

*********** **** ***** **** ****** ********* ******* ******** *** ***** pre-show ********* *********** **** *** ***-**********, **** ***** **** **** may ** ******* ********** *** ******** ** *** ******** ********, limiting ******* ********, **** ** ** ***** ****** *** ** funds ******* ********* ** *** ****.

************, **** ** * *** ** ****, ****** * **** time ********* **** * ****-***** ***** **** *** **** **** inspire ********** **** ***** *************. ****'* ****** ***** ***** *** other **+ **** ****** ***** ******.

FLIR ** ********

*** ******* ******** **** *** ******* ****** **** ** *** expected ** **, ****** **** *******, *** ****, *******. ************, they **** **** *** ******* ************* ** *** ******* *** enterprise ******** ** ********** **** **** ***** ***** *********, *** contribute ** ** ******* ******** **.

Outlook *** ****

****'* ********* ** *** ******** ****** *** ****** *** ****, and *** ******* ***** ******* **** ******** **** ** ***** most **********, ** *********, ********. **** ** *** ****** ****** are ********* *** ******** *******, ** ****** **** ************* **** taken ******* **********. **** *** ************* **** ******* ** *** low-cost/high-volume ******** (*.*.: *****), ***** ****** ***** **** ** *** medium ******** ***/** ********** ******** (*.*.: ********), *** * ***** few ***** ** ********* ************ ** ***** ******** **** ** analytics (*******) ** *****-****** ******* (*******). ****, *******, ** ********** to ***** *** ** ***** *****, ******** ********** **** *** retail **** ** ****** ******** ******* *******. **** ******** *** make ** ********* ** ***** *** ** *** *** *******, and ***** ********** ** ******** * ******* ******* *****.

Comments (10)

Undisclosed Integrator #1

08/02/17 10:45am

****. **** *** ********* **'* **** ** ******* ***** ***-*** FLIR (*** *********) ******* *** *********** *** **** ** *** bottom. * **** **** **** *** **** ** ******** ***** for ********* ******* *** *** ***** ****** ******* **** ****, undercutting *** **** ** *** ********. **** *** **** ** die * **** *****, *** *** **** **** ******* *******, so ** *** *** **** **** **** ******* *** **** on.

Thumbnail profile

Michael Gonzalez

08/02/17 10:29pm

**** *** ****** ******* ** ***** ******* ****, * *** of ***** ********* *** ********** **** **** ******. * ***** they *** ** ******* *** *********** ***** ** **** ***** of ***** *** *** **** ** ******** *******. * **** they **** **** ******...********** ***** *'** ****** ** ** ***** $500k ***** ** ***** ** ****** ******* **** *** **** few *****.

Undisclosed Integrator #2

08/03/17 02:26pm

**** ***** ************ ***** *** ***** ******** ** *** ******** call, ****'* *** *** ****** ********* ********* ** **** ******* of *** ******** ********

** ****** ** *** **** *** *** **** ****** **** Usain ****.

Undisclosed Integrator #2

In reply to Undisclosed Integrator #2 | 08/04/17 12:42pm

*** *** ******* **** * ****** ** *** *** ****** back, ** ******** ****** **** * ****** ****** *******. ***** be * ***** ** *** *** ******* ******* **** ***'* figure *** ***** ******** ****.

Undisclosed #3

08/07/17 11:23am

** *********** *********** ******* ******* ****** **** ***** *** **** and *** ***** ******* **** *********** ** **** *** *** managed ************ ****. ** ***, ** ********* *** ************* **********.

John Honovich

IPVM | 08/07/17 11:41am

*** ***** ***** *** **** *******, ****** **** ****, ******* these ******* *** *** * ******** **** *** ****:

Undisclosed #4

08/07/17 12:11pm

****. ***** ** ** **** ** ****'* ****, *******? * know ** ** ***** *** ***, ******** ** ***** ***** he ** **** ***** *** *********, ***'*. * ****** *** well ***** *** ***** * ****-*******. * **** ** ********** amazing **** ******** ***** *** **** **** *** *** *** not ***** ** **** **** **** ** ***** *** ** some ****** ****. ** **** ****** ***'* **** **** *** "smile ** **** **** *** *** **** **** ******" **** when **** ******** ******* ***.

Thumbnail brk1

Brian Karas

IPVM | 08/19/17 11:39am

****'* ******** **** **** ***** ** *** ****** ** ** "ASIS ************* *** ********** ****, ********* ** *******".

*** * **** **** *** **** **** **** ***** *** get ******* ********* ** **** * ***** ** **** * prime ********, *** ***** **** ** ********* (*** **** ****** draw *******).

John Honovich

IPVM | In reply to Brian Karas | 08/19/17 04:41pm

***** *** * *** ** **** ******* ******, ***:

**** ** ****** ***** *********:

Undisclosed #5

In reply to John Honovich | 08/19/17 06:26pm

*** ****** ***** ** *** **** ********.

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