Copen at Canaccord Conference: Strategic Shift and Growth Prospects

On Wednesday, 13 August 2025, Copen Corporation (NASDAQ:KOPN) took the stage at Canaccord Genuity’s 45th Annual Growth Conference. The company highlighted its strategic pivot towards application-specific solutions and a promising partnership with Theon International. Despite disappointing Q2 revenues due to budget delays, CEO Michael Murray expressed optimism for future growth, driven by new technological advancements and strategic alliances.

Key Takeaways

• Copen is focusing on application-specific solutions to improve profitability in the microdisplay market.
• A partnership with Theon International is expected to enhance market reach and facility utilization.
• The company is optimistic about future revenue opportunities from defense and consumer markets.
• Copen’s new neural display technology aims to address limitations in spatial computing devices.
• The company aims to achieve $100 million in revenue by 2027-2028.

Financial Results

• Q2 revenue was below expectations due to budget delays.
• The Theon partnership adds $15 million to Copen’s balance sheet.
• The company expects a cash position over $40 million following the Theon transaction.
• An opportunity pipeline is valued at approximately $850 million.
• Copen is tracking $20 million in expected R&D orders this quarter.

Operational Updates

• Theon partnership aims to increase utilization of the Dalgedi Bay, Scotland facility from 15% to over 50%.
• Copen introduced a neural display with AI-enabled features, enhancing its microdisplay offerings.
• A CR3 headset, developed with Carl Zeiss, is in production and used in surgeries, with more orders expected by 2026.
• The company maintains a 97% quality rating and is expanding its patent portfolio.
• Leadership changes include the retirement of CFO Rich Schneider and the appointment of Eric Manns.

Future Outlook

• The Theon partnership is projected to generate $25 million in revenue opportunities by 2027-2028.
• Copen targets a $100 million revenue by 2027-2028, with 25% expected from international markets.
• The Soldier Borne Mission Command program could unlock $500-750 million in revenue over ten years.
• Increased defense spending by NATO and the US presents significant opportunities.

Q&A Highlights

• Competition: eMagine, acquired by Samsung, is a key competitor but lacks Copen’s range of microdisplay technologies.
• Theon partnership is expected to achieve at least half of the $25 million revenue target from Theon’s spending.
• The first milestone for the SBMC program involves an order for color micro LED prototypes, which could lead to substantial revenue.

For a detailed account, readers are encouraged to refer to the full conference call transcript.

Full transcript - Canaccord Genuity’s 45th Annual Growth Conference:

George Genericus, Sustainability Analyst, Canaccord Genuity: Hi, everyone. I’m George Genericus, one of Canaccord Genuity’s sustainability analysts. Thank you for joining day two of our forty fifth annual growth conference. So very pleased to have with us today Michael Murray, CEO of Copen, local company, a provider of, optical display solutions. So, Michael, please go ahead.

Michael Murray, CEO, Chairman and President, Copen: Wonderful. Thank you very much, George. Appreciate the invite from our friends here at Canaccord. I hope you’re all having a wonderful couple of days in Boston. It’s not too balmy out there, so I will try to be brief and talk about some of the exciting news at Copen.

So before I do that, I’ll introduce myself. My name is Michael Murray. I’m the chief executive officer, chairman and president of the company. Just a little bit about me. I grew up in Canada.

Don’t hold that against me. They did let me into the country. And yes, I do play hockey very well. It’s it’s a prerequisite. I came to Koppen from a company called Ultra Electronics doing NSA type one cryptography and electronics.

My background is a semiconductor engineer where I spent over a decade at a little company called Analog Devices down the road here on 128 in Wilmington. So that’s my background. I’m the second CEO of Kopen Corporation. It was founded by Doctor. John Fan, who had two PhDs, one from MIT, one from Harvard.

Obviously he’s a slouch. He ran the company for forty years. So I’ll get started with a little safe harbor statement. I want you to all read this. There will be a test at the end.

And I do give away free prizes for those that get it right. So a little bit more about the company. We’re in a transformational stage. I’ve been with the company for just over two years at this point in time. What’s important to know about this slide is that we’re a semiconductor at the heart of what we do.

The problem is, and what we’re solving for currently, is there is not one semiconductor manufacturer who builds microdisplays that’s profitable. Not one. Sony, not profitable. Samsung, not profitable. LG, definitely not profitable at the moment, building microdisplays specifically.

Yields in this business, if you get 50% yield, you’re doing very well. In semiconductors, if you’re at analog devices, if you’re getting 90% yield, you’re not doing well. In contrast to this, if you get 25 to 50% yield, you’re doing very well. That’s a critical thing for our investors to understand. Yield equals loss.

Loss equals loss profits. Very simple. So what to do? What we did was we chose to go up the vertical chain and build what we call application specific solutions. And we’re going to do that for our tier one customer base, which I’m going to talk about now as we walk forward.

But before I do, I want to talk about a transaction that just happened. Most of you probably don’t know a company called Theon. Theon is a very large $1,700,000,000 corporation based out of Greece traded on the Amsterdam Stock Exchange. What’s super cool about them is they’re growing 50% compound annually for the last six years. Their stock price has accrued 169% growth in the past two years.

Why? The company is run very well by a gentleman by the name of Christian. He’s a good friend of mine. They are focused in NATO, Europe, and Southeast Asia. They provide what I think is some of the best technology in the world in thermal weapon sites and also thermal night vision goggles to NATO allies, of which Kopin currently sells $0 to.

So we created this partnership between Copen and Theon International, mainly because we have a facility in Rest actually in Dalgedi Bay, Scotland. That facility is very much underutilized. We utilize it about 15%. It has been our biggest profit leaker over the course of the last two years. The absorption rate in that facility has been about 15%.

Now it’s going to go up to above 50. And therefore, we’ll turn that business into a profit. Moreover, we moved much of our production into Dalgedi Bay Scotland for our microdisplays. Now Theon can take those microdisplays out of Europe and ship them in Europe and not have to pay any tariffs. That’s a good deal for them.

Moreover, they spend, Theon spends, single high digit millions to tens of millions of dollars in OLED and LCD micro displays, of which now Kopin can compete on those sockets. So and they’re also incentivized by 49% ownership in Delgitte Bay to use that facility for their use cases. So very, very key deal for us. Moreover, at this point in time, it adds $15,000,000 to our balance sheet in cash. So we’ll be sitting with over 40,000,000 in cash for the company.

And we’re going to use that money and put it to work to grow our overall competitiveness in Southeast Asia, Europe and with NATO allies. The vast majority of the business I’m gonna go through here is predominantly focused in The United States. Now we have a rest of world global enterprise for Copen for the first time ever in our history. We also have additional project funds. You’ll see in the 8 k that we just announced, there’s another $8,000,000 of cash available to Copen over and above the 15,000,000.

That is for specific pursuits that we have as two companies that we’ve identified that we wanna go after together. And we’ll use those funds as we see fit. Lastly, we’ve created a product called Darkwave that is an overlay to night vision goggles, which Theon will create a purchase order for us so we can take that business to market in Dalgedi Bay, Scotland, we think for one of the big countries in NATO. So look for an announcement on that shortly. Okay.

So we also have just entered into our first ESG strategy. This was big for our announcement with Theon. ESG in Europe is much bigger than it is here in The United States, believe it or not. But also, we thought it was important to have the ability to have our index funds and passive ETF flows because we were awarded back onto the Russell this year. So we’re now on the Russell 2000 and 3,000.

So having an ESG strategy is still very important to passive flows on ETFs. What’s different about Kopen is other than Sony, Kopen is the only company that builds all four different types of microdisplays. And we invented a fifth kind, which we’re going to go through today and show you for the first time. It is an AI enabled micro display that looks back at you while you’re using it to dynamically control your brightness and contrast so that your eyes don’t have to glint, squint or blink. We’re going talk about why that’s important to consumer companies and defense companies alike.

I’m not going go through this one. So we talked about Delgitte Bay. What’s important there is we build our liquid crystal on silicon technology as well as OLED and some of our micro LED technology. In Reston, Virginia, we build our head mounted displays and also our new CR three headset, which we just announced with Carl Zeiss out of Germany. And I’ll go through that in greater detail in a moment.

And we’re headquartered here in Westborough, Massachusetts. Straight out 90, about a half hour and you’ll be at our front door. Please let us know if you’re interested in coming by for a fab tour. We do love having our investors come in and say hello. So one of the things that we’re known for is our devices that go into high speed aircraft.

If you have heard of some of the aircraft that The United States puts out in place and some of the ability to see through optics, that is something that we’ve been involved with for a number of years. We currently have our LCD technology, our OLED technology, and micro LED technology in what we call our fast moving aircraft application. I can’t say which one, but it is one of the most lethal aircraft in the world and we are in all of those headsets today. You’ll notice from our previous slides, this slide has grown quite a lot. I’m very proud of this slide because we are now starting to see companies like Aero Environment, Blue Halo, Wilcox, Zeiss, Theon International, the Army, the Navy.

When I started with Copen two years ago, this slide was about half its size. And these are top tier defense companies and top tier medical and consumer companies. So very proud of the progress that we’re making here with our top customers. And again, we’re focused on improving technology performance. And we are the digital overlay on the real analog world, meaning we see through things and provide the ability for symbology and any sort of augmented reality that you might want in really mission critical systems.

Okay. So this is our fifth type of microdisplay. If you want to hit play there, I’m not sure if I can. There we go. This is what we demonstrated for the first time at AWE in Las Vegas, or pardon me, in California.

This is the microdisplay we call neural display. It has tiny pixels, red, green, and blue. But the fourth pixel is usually blue for deep color. But we change that fourth pixel to be an imager. And that imager looks back at you just like when you’re playing Battleship as a kid.

Oh, it’s over. Oh, there we go. Sorry, YouTube. I can’t control that. It’s live.

But that fourth pixel is a tiny imaging pixel that looks back at your eye for white, green and black. Or white, gray and black. Then we’re able to adjudicate how big your pupil will get with how much brightness we’re shining at your eye at a given time. Just like getting up at night when you go to the bathroom, pitch dark, you turn on the light and you have to squint. Imagine flying an f 35 doing the same thing or getting shot at at the same time.

It’s not very comfortable. So you have five hundred microseconds to dynamically tune that microdisplay from being too bright to just right. Moreover, if you’re a spatial computing device user, you want that same technology so that you can use that device long enough to watch a movie. And right now, that’s what’s gating things like Apple or Meta and the adoption rate of spatial computing. If I go back here, if I can go back, let’s see if that same slide is up.

This is the Apple Vision Pro. Look at the weight difference. That is just in cameras alone. We are half the weight, half the size, half the power consumption because we take all of those cameras doing eye tracking and control and we put it into the microdisplay. So I’m going spend some time here as well.

This slide has definitely expanded in the last year because of the conflicts in Europe, because of the conflicts in Israel. Kopen is one of the best companies in the world at providing microdisplays and optics in mission critical devices. We have new orders to announce very shortly in our Thermal Weapon Site Program. We are on two different iterations of the Next Generation short range interceptor, otherwise known as the Stinger missile program. The United States is going to supply over a 100,000 Stinger missiles in the next three years.

Therefore, that translates into roughly a 100,000 Stinger missile launchers. And Kopin is on that program with Lockheed as we speak. Darkwave, very interesting technology. We’re demonstrating that now. It takes a dumb night vision goggle.

If anyone’s seen Zero Dark 30 as an example. You put your night vision goggles on, you can see at night. That’s really cool. But DarkWave provides thermal imaging, so you can see thermally if there was anybody else in the room, plus symbology. Green good, red bad.

Very simple. That adds technology to an already installed base at Theon and here in The United States. And remember, Theon is the world’s leader in night vision goggles for all of NATO. So this is Burger and that’s the fries for Theon. So we already have an installed base of close to 20,000 night vision goggles.

I’d be remiss in not talking about our integrated visual acuity system strategy. This is what they call a program called SBMC or Soldier Born Mission Command or IVAS 1.2. You may have heard of a company called Androl and Palmer Lucky. They’ve novated that contract from Microsoft. There is a new contract that is going to be let, we believe, this year called Soldier Born Mission Command.

We are working with a number of companies that are bidding for that as prime contractors. Copen is not bidding as a prime contractor. We are bidding as a key technology acquisition specialist for microdisplays and optics. If Kopen were to win the microdisplay in Soldier Borne Mission Command, that would be in upwards of 500 to $750,000,000 of revenue to Copen over the course of ten years. And I’ll say that again, 500 to $750,000,000 of revenue starting in 2027 for Kopen.

And we’re very close to announcing some major developments in that area. And this technology would be focused on, again, digital overlays on the real time world and making sure that our soldiers have the best technology in the world so that they can see as well as anyone else in day or night. And unfortunately, China, Russia, and Iran already have this technology. We do not. The US government has always said we need to own the night.

Unfortunately, ladies and gentlemen, we no longer own the night. China, Russia and Iran do because they have this technology and we don’t. So this is very important to our future. And it’s all based around our color micro LED. And my goal is to announce a very, very soon an award for our monochrome micro LED.

And we will be the only United States company with a monochrome micro LED flying in an aircraft in production. So we have the pedigree, we have the providence, and we have the engineers to do it. We just need the army to award this technology for us. And that will unlock the Soldier Born Mission Command contract for Copenhagen. I spoke about this earlier, the next generation short range interceptor.

We’re working in two areas. A company called Blue Halo Aero Environment. We’ve been partnering with them on the next generation weapon fire as well as the ability to simulate the binoculars and monoscopes so that we can train our troops on how to use the next generation short range interceptor once it’s available from Lockheed and or Raytheon. So not only do we have the training and simulation side, but we’re also working on the production side so we can train our troops on the same technology and how to use it at the same time. So very different technologies from very different companies.

But these are publicly announced awards. And we were just awarded an urgent upgrade to this design. And we’ve been requested to move more quickly because they want to move into production more quickly than we originally had thought. So good news there for Kopen and certainly a tremendous opportunity for growth with the Stinger missile coming into production. I mentioned this earlier.

You can now go to Carl Zeiss website. This is our CR three headset that we partnered with HMDMD. This is now in surgery today. We’ve done over 200 surgeries with the headset. I think one of the leading hospitals is New York Presbyterian Hospital, where they’ve done over 200 surgeries using this headset.

The adoption rate here is a little bit slow. That’s how medical works. But we have the technology and it is now in production with Carl Zeiss. And we’re expecting orders for production for 2026 that are pretty exciting for this headset. And Kopen designed, built and supplies this entire headset to Carl Zeiss through HMDMD.

I want to spend a little bit of time here. Consumer is still very interesting for us. We’re currently doing studies of how neural display can actually enable this market. Size, weight, power consumption still gate spatial computing. We all know this.

We have to get rid of the power. We have to get rid of the size and the cameras that go into these headsets. And right now we’re doing studies of how we could use micro LED as well as very high frequency LCOS displays with a neural display backplane. LCOS is interesting in this market because of the refresh rate. An LCOS display can refresh at about four eighty hertz top end to give you a sense your standard TV at home is about 90 to 120 hertz.

So this thing’s smoking fast and very, very good for gaming applications. Okay. I’m not gonna go through the market opportunity. I think you all know that NATO is going to be spending over a trillion dollars, or NATO countries will be spending a trillion dollars in defense. And the United States Department of Defense will spend $1,300,000,000,000 in defense.

Big market for us, and it’s mostly focused around soldier borne systems, soldier borne projectiles, and obviously thermal imaging, of which we do better than anyone in my view in the world. Copen has a rich portfolio of patents. We now have six patents in AI enabled microdisplays. We’re the only company that I’m aware of that has an AI enabled bidirectional human in the loop capability. That capability was written in an award that went to the Secretary of Defense.

It was actually a white paper, should say, that went to the Secretary of Defense in January. It’s available online that states The United States needs micro LEDs and human in the loop technology to surpass China and Russia. Kopen is the only company that has this capability today. Q two revenue was a disappointment. We had some things go on in q two because of the budget and some of the delays.

It created some customer concern around their portfolios and their forecasts. The good news is we now have received the orders that we were expecting in the first half. So we’ll execute on those orders and announce them very shortly here in the second half. So quality has remained very much in focus for us. We’re still sitting at 97%.

This is a tremendous improvement for the company. I’m very proud of the progress that we’ve made there. And our opportunity pipeline is now ballooned at just shy of $850,000,000 of qualified factored opportunities that are either in the United States Department of Defense or now with our friends at NATO and Southeast Asia and Europe through Theon International. So great progress there. We did have a good bookings quarter.

It just didn’t happen as quickly as we thought. And moving into this quarter, we think that bookings number may double in terms of bookings. And we’re still tracking $20,000,000 of research and development orders that we’re expecting this quarter as well. Research and development is very important to the company because as soon as we receive those orders, we can start billing and actually accruing that revenue. I wanna take a moment to recognize Rich Schneider.

He’s in the back here. He’s been our CFO for twenty six years. He is retiring. Sorry to see Rich go, but we did hire a gentleman by the name of Eric Manns from Allegro Microsystems. And Eric starts on September 2.

And Rich will start to run marathons again probably on September 3. So big thank you to Rich for all of his stewardship, leadership and friendship, quite frankly, in the last three years with myself included. Alright. That’s the investment highlights. I can take a few questions if that’s okay.

George Genericus, Sustainability Analyst, Canaccord Genuity: Of course. Thank you, Michael. That was great. Maybe to start just in terms of your positioning in The US. I mean, we’ve talked about this in the past.

But how many providers, American providers of your technology are there? Yeah.

Michael Murray, CEO, Chairman and President, Copen: So there was a company called eMagine out of New York. EMagine provides OLEDs, displays, But they don’t do what we do. They don’t have the four other types of microdisplays. And they don’t do vertically integrated subsystems like we do. But that would be the nearest competitor, which Imagine was acquired by Samsung.

Question about how invested they are in the defense industry, quite frankly. But they do make decent displays. We don’t make every OLED display that’s out there, so they are competitive in that area. And we do compete head to head, but that would be the closest competitor for us.

George Genericus, Sustainability Analyst, Canaccord Genuity: And maybe you talked about multiple programs both in The US and now internationally through your new Theon partnership. Can you help us sort of compartmentalize what that could mean over the next couple of years for the company?

Michael Murray, CEO, Chairman and President, Copen: Yeah. Absolutely. So in working with Theon, we’ve identified 25,000,000 of real revenue opportunities by twenty twenty seven, twenty eight that the company wants to gain in the rest of the world. So that additional 25,000,000 of revenue in rest of world is very achievable. Even with just Theon spending alone, we think we can get to half that.

So very low number, low bar to jump over. That gets us Kopin to 100,000,000 in revenue in 2728, depending on how these other programs go, which is very exciting growth for Copen. But again, expecting 25% of our revenue to come from rest of world, I think is reasonable. And that would be great growth for the company sitting at 50,000,000 of revenue last year.

George Genericus, Sustainability Analyst, Canaccord Genuity: Maybe to focus on SPMC, which is obviously a huge opportunity. Massive. Talked about a lot. Maybe help us understand the milestones that we should be paying attention to over the next, you know, few months as and to figure out exactly how you’re positioned there.

Michael Murray, CEO, Chairman and President, Copen: Great question. So we actually had the first milestone already happen. The first milestone was we received an order from the US Army to provide them a plan to build prototypes of a color micro LED. The next milestone is they’re going to place, hopefully, an order to build prototypes of a color micro LED. That’ll be in the range of fifteen to twenty million.

That’s not all that exciting in of itself. But once we create that color micro LED, that unlocks the opportunity of Soldier Borne Mission Command, is five hundred to seven hundred and fifty million dollars of revenue to Kopen. But more than that, it opens up the opportunity for night vision goggles, the next generation thermal weapon sites or next generation squad weapon fire. Those in and of themselves are about a 100,000,000 each. So if we were to be awarded a research and development contract by the army directly, we will most likely be, unless we screw it up somehow, the vendor in Soldier Borne Mission Command.

Because a color micro LED, the brightness is a 100 times better, the contrast is a 100 times better for the same amount of voltage and power consumption as the standard OLED, and it lasts pretty much forever.

George Genericus, Sustainability Analyst, Canaccord Genuity: Any questions from the audience?

Unidentified speaker: One of the things I noticed, Michael, you you said SPMC has the potential for 500 to 750,000,000 of revenue. I think that’s up from the last time where you said it was in the 3 hundreds. Yep. Could you just kind of walk us through where that increase came from?

Michael Murray, CEO, Chairman and President, Copen: Yeah. We think it’s gonna be more expensive to build a color micro LED. I wish I had a better answer for you. But unfortunately, color micro LEDs are very expensive because of the yield. And our studies are showing that our cost structure on a color micro LED is actually higher than what we thought it was going to be.

So to give you a sense of volume, we’re expecting obviously two displays per headset, 10,000 to 12,000 headsets per year starting in 2027. And you can kind of do the math from there, what we expect each display to amount to. But we also added the aspect of providing an optic with that microdisplay. So it’s not just the microdisplay, we’ll actually provide an optic with it. So a piece of glass or magnifier that goes along with that design.

So that’s the other increase that’s in that in that number. And that’s something we do every day, by the way. That’s with well within our capability.

George Genericus, Sustainability Analyst, Canaccord Genuity: It’s a great place to stop. Thank you, Michael.

Michael Murray, CEO, Chairman and President, Copen: Great, George. Thank you so much. Appreciate your time. Thank you.

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