WISeKey Semiconductors Segment SEALSQ Announces Q1 2023 Non-Audited Revenue of $7.2 Million, a 91% Year-Over-Year Increase

In Q1 2023, SEALSQ Launched its First Demonstrator of Quantum Resistant Technology, a New Generation of Quantum Resistant Algorithms Running on One of its Common Criteria EAL5+ Tamper Resistant Secure Arm Platforms

Zurich and BVI – May 11, 2023: Ad-Hoc announcement pursuant to Article 53 of SIX Listing Rules – WISeKey International Holding Ltd (NASDAQ: WKEY / SIX: WIHN) (“WISeKey” or the “Company”), a leading Swiss cybersecurity and IoT company announces Q1 2023 unaudited revenues for its wholly owned semiconductors subsidiary WISeKey Semiconductors SAS which is the predecessor of SEALSQ Corp (“SEALSQ”) (www.sealsq.com).

Q1 FY23 Highlights:

• Total revenue of $7.2 million, up 91% year-over-year.
• Experienced strong revenue growth in all semiconductors target markets across network infrastructure, smart building, health IoT, two-factors-authentication USB token.

The Q1 2023 total revenue year-over-year increase of 91% was driven by higher demand coming from of our existing customers mainly in the Network IT infrastructure and Home Automation, as well as with new designs captured in 2022 which ramped up in the later part of 2022 and deployed in 2023.

This builds on the growth SEALSQ exhibited in 2022 financial year during which it reported solid revenue of $23.2 million with a growth rate of more than 36% compared to FY 2021, and EBITDA of $3.0 million. This was reflective of steady semiconductors demand and an ambitious roadmap to develop the next generation of post-quantum chips.

Carlos Moreira CEO of WISeKey noted, “SEALSQ made significant progress in its strategic transformation, and this progress is reflected in both its top-line and bottom-line results for FY 2022, a growth which has continued in Q1 2023. We believe that SEALSQ's revenue growth and profitability have reached a tipping point where investments we made in the previous years are starting to pay off. One of the key drivers of this success story is the strong global momentum we have seen in the IoT sector requiring the type of secure semiconductors SEALSQ is specialized in providing. SEALSQ semiconductors have been gaining traction and contributing significantly to its revenue growth and profitability.”

Mr. Moreira continued, “This growth in the semiconductors post quantum has been achieved through various strategies, including steps we took to expand SEALSQ's presence in the North American market, invest in new generation of semiconductors (Quasar), and the on-chip cloud-based solutions, and offer provisioning services with the Matter Root-of-Trust PAA to help our customers save time and money in achieving Matter security compliance. Furthermore, we invested in bringing in new talent and enhancing our sales team capabilities.”

SEALSQ’s success in the cloud sector has resulted in strong revenue growth in the current quarter. This demonstrates that the company's efforts in transforming its business strategy are yielding positive results and that it is well positioned for future growth and success.

SEALSQ achieved major milestones with the Post-Quantum engineering team being able to carry both Kyber and Dilithium CRYSTAL quantum-resistant NIST selected algorithms and the appropriate APIs on the MS6003, a WISeKey Common Criteria EAL5+ Certified secure hardware platform powered by an ARMSC300 core and featuring an USB interface, thus creating the first Quantum-Resistant USB Token demonstrator. This demonstrator marks a significant milestone for the QUASARS (QUAntum resistant Secure ARchitectureS) project and takes us one step closer to achieving our goal of building a Post-Quantum Hardware Security Module and Root-of-Trust.   

SEALSQ has also taken affirmative steps to implement its QUASARS project. The QUASARS project, is a radically innovative solution, based upon the new WISeKey Secure RISC V platform that is paving the way for the Post Quantum Cryptography era, offering hybrid solutions compliant with ANSSI’s (“Agence nationale de la sécurité des systèmes d’information,” the National Cybersecurity Agency of France) recommendations. Of note, SEALSQ has received strong support from the French SCS (Secured Communicating Solutions) Cluster for its QUASARS project. This project is expected to generate new revenue streams in the medium term.

SEALSQ is using AI capabilities to increase the performance of post-quantum semiconductors by assisting in the design and optimization of these materials. AI can be used to simulate and model the behavior of these semiconductors, which can help researchers to identify the most promising materials for use in quantum devices.

The market for semiconductors is currently witnessing a renewed interest as there has been a significant global shortage of semiconductors during COVID, which has affected various industries, including automotive, consumer electronics, and telecommunications. This shortage has created a sense of urgency among companies to secure a stable and reliable supply of semiconductors, leading to increased demand for semiconductor companies.

As is the case with SEALSQ, semiconductors are at the heart of technological advancements such as artificial intelligence (AI), Post-Quantum, Internet of Things (IoT), cloud computing, and 5G. These emerging technologies require advanced semiconductor chips to power their functionality. As the adoption of these technologies accelerates, the demand for semiconductors and the companies that produce them naturally increases. With the proliferation of data-intensive applications and the expansion of cloud computing services, there is a growing need for data centers to process and store large volumes of data. Data centers heavily rely on semiconductors for servers, storage systems, and networking equipment. The rising demand for data centers has consequently fueled the demand for semiconductors.

Many governments worldwide including the EU and US with their e-Chip act recognize the strategic importance of the semiconductor industry and are actively supporting its growth. Governments are investing in research and development, providing incentives to semiconductor companies, and promoting domestic semiconductor manufacturing. These initiatives have created a favorable environment for semiconductor companies, attracting investor interest.

As per our recent Extraordinary General Meeting, WISeKey International Holding (WIHN) has approved a special dividend-in-kind to be paid to all of its shareholders in the form of shares in its subsidiary, SEALSQ Corp., a company that will (subject to certain approvals) be listed on the Nasdaq.  In order to ensure that no withholding tax is levied on the distribution, shareholders are required to complete a Tax declaration that confirms they are not US citizens and therefore can receive the dividend free of withholding tax.  We would therefore ask that you proceed with the process.  You can find more information on the following website regarding the Spin-off at https://www.wisekey.com/company/investors/.

As previously announced, SEALSQ Ordinary Shares are currently expected to begin trading on a “when-issued” basis on the Nasdaq from market open on May 19, 2023, and continue up to and including May 23, 2023 under the ticker “LAESV.” Trades in the “when-issued” market are expected to settle on May 26, 2023. SEALSQ Ordinary Shares are expected to commence “regular-way” trading on May 24, 2023 under the ticker symbol “LAES”. Trades in the “regular-way” market are expected to settle within the standard settlement cycle, which is the second business day after the trade.

About SEALSQ
SEALSQ is a wholly owned subsidiary of the WISeKey Group that focuses on developing and selling Semiconductors, PKI and Post-Quantum technology hardware and software products. Our Post-Quantum solutions include Post-Quantum microchips and devices that can be used in a variety of applications, from Multi-Factor Authentication devices, Home Automation, and IT Network Infrastructure, to Automotive, Industrial Automation and Control Systems.

Post-Quantum Cryptography (PQC) refers to cryptographic methods that are secure against an attack by a quantum computer. As quantum computers become more powerful, they may be able to break many of the cryptographic methods that are currently used to protect sensitive information, such as RSA and Elliptic Curve Cryptography (ECC). PQC aims to develop new cryptographic methods that are secure against quantum attacks. For more information please visit www.sealsq.com.

About WISeKey
WISeKey (NASDAQ: WKEY; SIX Swiss Exchange: WIHN) is a leading global cybersecurity company currently deploying large scale digital identity ecosystems for people and objects using Blockchain, AI and IoT respecting the Human as the Fulcrum of the Internet. WISeKey microprocessors secure the pervasive computing shaping today’s Internet of Everything. WISeKey IoT has an install base of over 1.5 billion microchips in virtually all IoT sectors (connected cars, smart cities, drones, agricultural sensors, anti-counterfeiting, smart lighting, servers, computers, mobile phones, crypto tokens etc.).  WISeKey is uniquely positioned to be at the edge of IoT as our semiconductors produce a huge amount of Big Data that, when analyzed with Artificial Intelligence (AI), can help industrial applications to predict the failure of their equipment before it happens.

Our technology is Trusted by the OISTE/WISeKey’s Swiss based cryptographic Root of Trust (“RoT”) provides secure authentication and identification, in both physical and virtual environments, for the Internet of Things, Blockchain and Artificial Intelligence. The WISeKey RoT serves as a common trust anchor to ensure the integrity of online transactions among objects and between objects and people. For more information, visit www.wisekey.com.

Forward-Looking Statements

This communication expressly or implicitly contains certain forward-looking statements concerning WISeKey International Holding Ltd, SEALSQ Corp and their respective businesses. Forward-looking statements include statements regarding our business strategy, financial performance, results of operations, market data, events or developments that we expect or anticipates will occur in the future, as well as any other statements which are not historical facts. Although we believe that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve known and unknown risks and are based upon a number of assumptions and estimates which are inherently subject to significant uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those expressed or implied by such forward-looking statements. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the expected benefits and costs of the intended spin-off transaction, the expected timing of the completion of the spin-off transaction and the transaction terms, SEALSQ’s ability to implement its growth strategies, SEALSQ’s ability to continue beneficial transactions with material parties, including a limited number of significant customers; market demand and semiconductor industry conditions; the approval of SEALSQ’s listing of its Ordinary Shares on NASDAQ and the risks discussed in WISeKey’s and SEALSQ’s filings with the SEC. Risks and uncertainties are further described in reports filed by WISeKey and SEALSQ with the SEC.

SEALSQ Corp is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.

Press and investor contacts:
This press release, or referenced documents, do not constitute an offer to sell, or a solicitation of an offer to buy, any securities, and do not constitute an offering prospectus within the meaning of the Swiss Financial Services Act of June 15, 2018, as amended (“FinSA”) or advertising within the meaning of the FinSA. Investors must rely on their own evaluation of WISeKey and their subsidiaries, including SEALQ and their securities, including the merits and risks involved. Nothing contained herein is, or shall be relied on as, a promise or representation as to the future performance of WISeKey or its subsidiaries, including SEALQ.

The registration statement referred to above, including the prospectus contained therein, constitutes a foreign prospectus within the meaning of article 54 paras. 2 and 3 of the FinSA and article 70 paras. 2-4 of the Swiss Financial Services Ordinance of November 6, 2019, as amended.