AKP Valuations

There's been the odd mention here and there about valuations so I thought I'd kick off a discussion.

Based on AKP's estimated target market share from their presentation (i.e. 15%, equating to ~3.3B chips based on ~2014 stats), and of my own thumb-suck profit margin (20c per chip), overheads, tax, etc I get a market cap of roughly $9B (20x P/E).


However I decided to look at it differently...

Rather than take AKP's blanket 15% market share I figured I'd look at some of the areas on a per device basis (except for AKP's Automotive and General Use categories). I believe there's some devices where AKP's product will pretty much become the defacto standard for both audio quality and design (inc. installation) characteristics.

I'm also thinking space and power usage constraints preclude the listener from actually getting the sound they want from current devices. Therefore the chip to speaker ratios put forward by AKP could be underestimating demand, e.g. listeners wanting smartphone audio output equivalent to 2 chips rather than 1, however I've left those thoughts out of my estimates below.

These very rough estimates are based on no other companies bringing similar technology to market. Look forward to others sharing their thoughts on the assumptions...