FLIR Security Business Struggling

By Brian Karas, Published Aug 02, 2017, 10:19am EDT

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.

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

****'* ******** ******** **** an ****** *** ** revenue ** ** ****, falling **%, ********* * weak **'* **** *%. Q2 ******** ******* *** $49.7M, **** **% **** 2016's $**.**, *** ****** back ** ****'* $**.** [link ** ****** *********].

** ****** **** ****'* Q2 ******** **** [**** no ****** *********], **** decline *** ********* ********** to *** *****-******* ******** sold ** ********* ******* retail *******:

*** ******* *********** ********* in *** ****** *******, and ****** ** ****** for ***** ********. *******, assuming ***** *** ***** orders ** ********, ******* would **** **** ~$***, still **** ~**%

**** **** **** **** of *** * ******* line ******** ** *** Security ******** (******* *******, retail/Lorex, ***/******* **** ******* ADI, *** **********/****** ***** products) **** *** ******* division ****** ****** ******.

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

** ******** **** *** thermal ******** ** ***** FLIR's ******* ******* ** the ******** ********, ************ ~50% ** ***** *******. Another **-**% ***** **** the ***** ****** *******, and *** ******* ********** branded ** **** *** sold ******* ************ ******** like ***. *** *********, and ****** **** **** 20% ** ******* *******, is *** ***** ******* line.

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

*** ********* **** ** FLIR's ******** ******** ** its **** ******* ****** products. ***** ******** *** often **** ** ******** infrastructure ************, *** ** other ********* ***** ***** is *** ****** *** top *********** ******. ** this ******, **** *** deep ********* ** **** product *** ***** *****, which ********* ** **** segment ***** ******. *****, the ******* ****** **** new ******* ******** **** manufacturers **** ********* *** putting ********* ******** ** the ******* *******.

Lorex **********

***** ** ** *** middle ** *** **** to *** ******. **** of *** ******* **** is********* ***** ********, ******* ****'* ****** demands **** ** ********* to ******* **** * multitude ** ***** ***** OEM's **** *-***, ** other ******* ******** **** Foscam *** ******* **** are ****** ********* ** Amazon, ** **** ********* Lorex ** ******, **** Depot, *** ***** ******.

** ******* **** ** these ******, **** *** added ** ******* ** the ***** ****, *** also********** * "****-****" ********** *** ******* **** contains ******* ************ *** found ** ***** ********, giving **** * **** distinct ********. ** ***** that **** ****** ***** provide ***** **** **** differentiation **** ***** *** systems.

**** **** ****** **** they *** ******* ** get **** ********* ** the ******* **** *** retail ******** ** ****** out *** "*********" ** the ***** ****, ***** can ***** ***** ********* revenue ******* *************, ** this ******* ******.

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

*****, ******** *.* ***** ago, ** ***** *** significantly ****** *****. ******* in **** ******* *** been ****** ****, ********* to ****. ****** *** company ******** ******* *.* of *** ***** "********" VMS ******* **** ****, the ******* **** *** not **** *** ***** improvements **** *** ** apart **** **** ** available **** ***********.

**** ***** ************ ***** the ***** ******** ** the ******** ****, ****'* new *** ****** ********* specifics ** **** ******* of *** ******** ********, talking ******* ***** *** thermal ******** ******:

**** ********** ** *** Latitude ******* **** **** incorporated **** ****'********* ******* *** ******* software, ***** ** ********* sold ** ***** ******** division. ***** **** ******** the ******* *******, ** does *** **** ******** revenue.

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

**** **** *** *** team ** "******** *******" on ****-********** ******* *******, some ** ***** *** company ******* ** ******** in ** ****. ***** this ** * **** sign *** *** ******* division, ** ** ************* relative ** *** ***** Security ******** *****, ************ the ***** *******, ***** could ******* **** **** advanced ******* *** ****** options ** **** ** competitive **** ***** ***-**-*** solutions **** ********.

**** ******** *** ** 2016, ******* *** *********** in ** ****'* ******** update [**** ** ****** available] ** ****** ***** experience, ************ **** ***** cameras:

**** *** ***** ** network/encoding ****** ** **** thermal ******* **** *** years, ***** *** *** team ** ****** ******** on, ***** ***** ************.

Out ** ****

**** ********* **** *** pulling *** ** ****, calling ** * "***** sell", ****** ******* **** **** ***** map***** ***** **** ** an *********. **** ***** intends ** ******* ** ISC ****, *** *** not ******* * ******** about ********** ** **** 2018.

*********** **** ***** **** booths ********* ******* ******** and ***** ***-**** ********* commitments **** *** ***-**********, this ***** **** **** may ** ******* ********** all ******** ** *** Security ********, ******** ******* spending, **** ** ** means ****** *** ** funds ******* ********* ** the ****.

************, **** ** * hit ** ****, ****** a **** **** ********* with * ****-***** ***** does *** **** **** inspire ********** **** ***** manufacturers. ****'* ****** ***** joins *** ***** **+ ASIS ****** ***** ******.

FLIR ** ********

*** ******* ******** **** the ******* ****** **** Q2 *** ******** ** Q3, ****** **** *******, not ****, *******. ************, they **** **** *** product ************* ** *** thermal *** ********** ******** in ********** **** **** boost ***** *********, *** contribute ** ** ******* stronger **.

Outlook *** ****

****'* ********* ** *** security ****** *** ****** too ****, *** *** company ***** ******* **** focusing **** ** ***** most **********, ** *********, segments. **** ** *** bottom ****** *** ********* the ******** *******, ** combat **** ************* **** taken ******* **********. **** are ************* **** ******* on *** ***-****/****-****** ******** (e.g.: *****), ***** ****** focus **** ** *** medium ******** ***/** ********** segments (*.*.: ********), *** a ***** *** ***** on ********* ************ ** niche ******** **** ** analytics (*******) ** *****-****** cameras (*******). ****, *******, is ********** ** ***** all ** ***** *****, offering ********** **** *** retail **** ** ****** advanced ******* *******. **** strategy *** **** ** difficult ** ***** *** in *** *** *******, and ***** ********** ** creating * ******* ******* image.

Comments (10)

Good.  FLIR has tarnished it's name by hawking cheap low-end FLIR (aka Digimerge) systems and accelerated the race to the bottom.  I hope they feel the pain in staffing costs for technical support for all those Costco systems they sold, undercutting the rest of the industry.  Time for FLIR to die a slow death, HIK and Axis sell Thermal cameras, so we can all just wave them goodbye and move on.

Agree: 5
Disagree: 5
Informative: 3
Unhelpful: 2
Funny: 4

Axis has really stepped up their thermal game, a lot of their analytics far outperform what FLIR offers. I guess they may be feeling the competition after so many years of being the big name in infrared imaging. I hope they come back strong...especially since I've picked up at least $500k worth of their FC series cameras over the last few years.

Agree: 3
Disagree: 1
Informative: 3
Unhelpful
Funny

When asked specifically about the DvTel business on the investor call, FLIR's new CEO dodged providing specifics on that segment of the Security business

He dodged to the left and ran away faster than Usain Bolt.

Agree: 2
Disagree
Informative
Unhelpful
Funny: 7

Sad too because when I looked at the VMS awhile back, it actually looked like a pretty decent product. Would be a shame if the VMS suffers because FLIR can't figure out their hardware side.

Agree: 2
Disagree
Informative: 1
Unhelpful
Funny

We experienced significant quality related issues with their SMB line and the DVTel rollout post acquisition as FLIR was not managed particularly well. In all, an expensive and disappointing experience.

Agree: 2
Disagree
Informative: 3
Unhelpful
Funny

Too funny about the poll results, unless your ASIS, because these results are not a positive sign for them:

Agree: 3
Disagree
Informative
Unhelpful
Funny

Hmmm. Could it be some of FLIR's reps, perhaps? I know of at least one who, although he might think he is well liked and respected, isn't. A little too well known for being a  back-stabber. I find it completely amazing that somebody could act like this guy has and not think it will come back to haunt you at some future time. Or that others won't also play the "smile to your face and act like your friend" game when they actually dislike you.

Agree: 1
Disagree
Informative: 2
Unhelpful
Funny

FLIR's previous ASIS 2017 booth is now listed as an "ASIS Collaboration and Networking Zone, sponsored by Anixter".

Not a good sign for ASIS that they could not get another exhibitor to take a booth in such a prime location, and right next to Hikvision (who will surely draw traffic).

Agree: 1
Disagree
Informative: 3
Unhelpful
Funny

There are a lot of ASIS related booths, see:

Also 35 booths still available:

Agree
Disagree
Informative: 2
Unhelpful
Funny

Its pretty close to the main entrance.

Agree
Disagree
Informative: 1
Unhelpful
Funny
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