FLIR Security Business Struggling

Published Aug 02, 2017 14:19 PM

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 ******** *******

****'* ******** ******** **** ** ****** hit ** ******* ** ** ****, falling **%, ********* * **** **'* down *%. ** ******** ******* *** $49.7M, **** **% **** ****'* $**.**, and ****** **** ** ****'* $**.** [link ** ****** *********].

** ****** **** ****'* ** ******** call [**** ** ****** *********], **** decline *** ********* ********** ** *** Lorex-branded ******** **** ** ********* ******* retail *******:

IPVM Image

*** ******* *********** ********* ** *** retail *******, *** ****** ** ****** for ***** ********. *******, ******** ***** got ***** ****** ** ********, ******* would **** **** ~$***, ***** **** ~14%

**** **** **** **** ** *** 4 ******* **** ******** ** *** Security ******** (******* *******, ******/*****, ***/******* sold ******* ***, *** **********/****** ***** products) **** *** ******* ******** ****** strong ******.

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

** ******** **** *** ******* ******** is ***** ****'* ******* ******* ** the ******** ********, ************ ~**% ** total *******. ******* **-**% ***** **** the ***** ****** *******, *** *** similar ********** ******* ** **** *** sold ******* ************ ******** **** ***. The *********, *** ****** **** **** 20% ** ******* *******, ** *** DvTel ******* ****.

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

*** ********* **** ** ****'* ******** business ** *** **** ******* ****** products. ***** ******** *** ***** **** in ******** ************** ************, *** ** other ********* ***** ***** ** *** always *** *** *********** ******. ** this ******, **** *** **** ********* in **** ******* *** ***** *****, which ********* ** **** ******* ***** highly. *****, *** ******* ****** **** new ******* ******** **** ************* **** Hikvision *** ******* ********* ******** ** the ******* *******.

Lorex **********

***** ** ** *** ****** ** the **** ** *** ******. **** of *** ******* **** *********** ***** ********, ******* ****'* ****** ******* **** it ********* ** ******* **** * multitude ** ***** ***** ***'* **** Q-See, ** ***** ******* ******** **** Foscam *** ******* **** *** ****** available ** ******, ** **** ********* Lorex ** ******, **** *****, *** other ******.

** ******* **** ** ***** ******, FLIR *** ***** ** ******* ** the ***** ****, *** ************** * "****-****" ********** *** ******* **** ******** ******* combinations *** ***** ** ***** ********, giving **** * **** ******** ********. We ***** **** **** ****** ***** provide ***** **** **** *************** **** other *** *******.

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**** **** ****** **** **** *** working ** *** **** ********* ** the ******* **** *** ****** ******** to ****** *** *** "*********" ** the ***** ****, ***** *** ***** their ********* ******* ******* *************, ** this ******* ******.

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

*****, ******** *.* ***** ***, ** ***** *** ************* ****** value. ******* ** **** ******* *** been ****** ****, ********* ** ****. Though *** ******* ******** ******* *.* of *** ***** "********" *** ******* this ****, *** ******* **** *** not **** *** ***** ************ **** set ** ***** **** **** ** available **** ***********.

**** ***** ************ ***** *** ***** business ** *** ******** ****, ****'* new *** ****** ********* ********* ** that ******* ** *** ******** ********, talking ******* ***** *** ******* ******** growth:

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**** ********** ** *** ******** ******* have **** ************ **** ****'********* ******* *** ******* ********, ***** ** ********* **** ** their ******** ********. ***** **** ******** the ******* *******, ** **** *** help ******** *******.

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

**** **** *** *** **** ** "entirely *******" ** ****-********** ******* *******, some ** ***** *** ******* ******* to ******** ** ** ****. ***** this ** * **** **** *** the ******* ********, ** ** ************* relative ** *** ***** ******** ******** units, ************ *** ***** *******, ***** could ******* **** **** ******** ******* and ****** ******* ** **** ** competitive **** ***** ***-**-*** ********* **** Avigilon.

**** ******** *** ** ****, ******* *** *********** ** ** 2016's ******** ****** [**** ** ****** available] ** ****** ***** **********, ************ with ***** *******:

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**** *** ***** ** *******/******** ****** in **** ******* ******* **** *** years, ***** *** *** **** ** likely ******** **, ***** ***** ************.

Out ** ****

**** ********* **** *** ******* *** of ****, ******* ** * "***** sell", ****** ******* **** **** ***** ******** ***** **** ** ** *********. FLIR ***** ******* ** ******* ** ISC ****, *** *** *** ******* a ******** ***** ********** ** **** 2018.

IPVM Image

*********** **** ***** **** ****** ********* require ******** *** ***** ***-**** ********* commitments **** *** ***-**********, **** ***** that **** *** ** ******* ********** all ******** ** *** ******** ********, limiting ******* ********, **** ** ** means ****** *** ** ***** ******* committed ** *** ****.

************, **** ** * *** ** ASIS, ****** * **** **** ********* with * ****-***** ***** **** *** help **** ******* ********** **** ***** manufacturers. ****'* ****** ***** ***** *** other **+ **** ****** ***** ******.

FLIR ** ********

*** ******* ******** **** *** ******* orders **** ** *** ******** ** Q3, ****** **** *******, *** ****, revenue. ************, **** **** **** *** product ************* ** *** ******* *** enterprise ******** ** ********** **** **** boost ***** *********, *** ********** ** an ******* ******** **.

Outlook *** ****

****'* ********* ** *** ******** ****** are ****** *** ****, *** *** company ***** ******* **** ******** **** on ***** **** **********, ** *********, segments. **** ** *** ****** ****** are ********* *** ******** *******, ** combat **** ************* **** ***** ******* approaches. **** *** ************* **** ******* on *** ***-****/****-****** ******** (*.*.: *****), while ****** ***** **** ** *** medium ******** ***/** ********** ******** (*.*.: Avigilon), *** * ***** *** ***** on ********* ************ ** ***** ******** such ** ********* (*******) ** *****-****** cameras (*******). ****, *******, ** ********** to ***** *** ** ***** *****, offering ********** **** *** ****** **** to ****** ******** ******* *******. **** strategy *** **** ** ********* ** stand *** ** *** *** *******, and ***** ********** ** ******** * unified ******* *****.

Comments (10)
UI
Undisclosed Integrator #1
Aug 02, 2017

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.

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Avatar
Michael Gonzalez
Aug 03, 2017
Confidential

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.

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UM
Undisclosed Manufacturer #2
Aug 03, 2017

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.

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UM
Undisclosed Manufacturer #2
Aug 04, 2017

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.

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U
Undisclosed #3
Aug 07, 2017

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.

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JH
John Honovich
Aug 07, 2017
IPVM

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

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U
Undisclosed #4
Aug 07, 2017

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.

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Avatar
Brian Karas
Aug 19, 2017
IPVM

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).

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JH
John Honovich
Aug 19, 2017
IPVM

There are a lot of ASIS related booths, see:

Also 35 booths still available:

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U
Undisclosed #5
Aug 19, 2017
IPVMU Certified

Its pretty close to the main entrance.

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