Greetings and welcome to the Socket Mobile Fourth Quarter 2015 Management Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Jim Byers of the MKR Group. Thank you. Mr. Byers, you may begin.

Thank you, operator. Good afternoon and welcome to Socket’s conference call today to review financial results for its fourth quarter and year ended December 31, 2015. On the call today from Socket are Kevin Mills, President and CEO; and Dave Dunlap, Chief Financial Officer. Also joining us today from Socket Mobile is James Lopez, Socket’s Vice President of Marketing to answer your questions on recently announced Socket products and the markets for these products. Socket Mobile distributed its earnings release over the wire service earlier today. The release has also been posted on Socket’s website at www.socketmobile.com. In addition, a replay of today’s call will be available at vcall.com shortly after the call’s completion and a transcript of this call will be posted on the Socket website within a few days. We’ve also posted replay numbers in today’s press release for those wishing to replay this call by phone. The phone replays will be available for one-week. Before we begin, I would like to remind everyone that this conference call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities and Exchange Act of 1934 as amended. Such forward-looking statements include but are not limited to statements regarding mobile computer data collection and handheld computer products, including details on timing, distribution and market acceptance of products; and statements predicting trends of sales and market conditions and opportunities in the markets in which Socket sells its products. Such statements involve risks and uncertainties, and actual results could differ materially from the results anticipated in such forward-looking statements, as a result of a number of factors including but not limited to the risk that manufacture of Socket’s products may be delayed or not rolled out as predicted, due to technological market or financial factors, including the availability of product components and necessary working capital, the risk that market acceptance and sales opportunities may not happen as anticipated, the risk that Socket's application partners and current distribution channels may choose not to distribute the products or may not be successful in doing so, the risks that acceptance of Socket's products in vertical application markets may not happen as anticipated, as well as other risks described in Socket’s most recent Form 10-K and 10-Q reports filed with the Securities and Exchange Commission. Socket does not undertake any obligation to update such forward-looking statements. Now, with that said, I would like to turn the call over to Socket’s President and CEO, Kevin Mills.

Thanks Jim. Good afternoon everyone, and thank you for joining us today. 2015 was a very good year for Socket Mobile in which we achieved both revenue growth and increased profitability. For saying the key objectives we outlined at the beginning of the year. More importantly these positive results demonstrated the success of our application driven business model, which provides us with continued opportunity for good long-term growth. Looking at our revenue results for 2015, total revenue for the full-year were $18.4 million, an increase of 8% over 2014. This growth was primarily driven by our cordless barcode scanning business which grew approximately 16% year-over-year and represented 85% of our total revenue in 2015, up from 79% of revenue in 2014. Our legacy SoMo related business represents 11% of our total revenue in 2015, down from 17% in 2014. The remaining 4% of revenue came from legacy and service related products in both years. Our higher full-year revenue coupled with our improved gross margin and modest expense growth, resulted in a bottom line process for 2015 of $1.8 million or $0.33 per share. A substantial increase over the $433,000 or $0.09 per share we recorded in 2014. Our positive results in 2015 primarily reflects the success of our strong application driven business model, which has been our focus over the past few years. Under this model, our scanners are secondary purchase to an application sale. The mobile point of sale market provides a good example of how this model works. The customers primary purchase is the mobile point of sale application. Once this purchase has been made the customer must then chose from along a limited number of hardware peripherals supported by the application provider. Socket’s success with this process is largely due to our SDK, our application-centric focus and…

Thank you, Kevin. Our fourth quarter revenue was $5.4 million compared to revenue in the previous quarter of $4.5 million and revenue in the same quarter a year ago of $3.9 million. The fourth quarter was sequentially higher than the third quarter by 19% and higher than the same quarter a year ago by 38%. We found that the mobile point of sale selling season this year lasted longer than last year and we experienced higher sales from other mobile categories. Cordless barcode scanning revenues were $4.2 million or 78% of our revenue for the quarter, up from $4 million in the previous quarter and up from $3.1 million in the fourth quarter a year ago. SoMo handheld computer sales in the fourth quarter were $857,000, up from $379,000 in the previous quarter and an increase of $146,000 over the fourth quarter a year ago. Adding to our fourth quarter total, for legacy product orders of $231,000 and service revenues of $101,000. Our fourth quarters SoMo handheld computer revenue included $320,000 or 20% of a $1.6 million SoMo order shippable over several quarters that we mentioned in our last conference call. Our margins on Q4 sales increased to 51.5%, up from 49.5% in the previous quarter and up from 44.6% in the fourth quarter a year ago. The increase in Q4 over the previous quarter of 2% as Kevin mentioned reflected one-time sales of legacy products in the quarter. Our margins after those sales were similar to the previous quarter’s margins. Over this past year, higher unit volumes have enabled us to reduce some of the component pricing for our products to spread out our manufacturing overhead costs over more units and to increase our manufacturing efficiencies. In 2015, we sold 65,500 cordless scanners worldwide, up 19% from unit sales…

Thank you. [Operator Instructions] Our first question comes from the line of Brian Swift from Security Research Associates. Please proceed with your question.

Yes, thank you. A couple of things, one I didn’t get the numbers on the - number of barcode scanners sold in 2015 versus 2014, how do I miss that. You mentioned a number 65,000…

Yes, the number was 65,000 in 2015, 55,000 in 2014.

Okay, 65,000 versus 55,000. Okay, and then secondly on the SoMo orders, [indiscernible] you shipped 857,000 I think that’s the number for Q4?

That was the total SoMo sales in Q4 Brian, 320,000 was the portion of the $1.6 million orders that we shipped in the fourth quarter.

No 320,000 of the $1.6 million?

320,000 of the $1.6 million it was included in the total SoMo sales for the quarter. So the balance –we’ll ship up all over the next quarter or two or three.

Okay. Can you give us any kind of guidance in terms of how much of that should be in Q1? I mean it will be similar to Q4 or something more…

I’d say a lot of that will depends on the customer.

Okay. So they haven’t given you a rent around that.

We’re coordinating our activities with them and we’ll make that judgment with them as we go, but the order that we have is firm.

Okay. I’m just trying to figure out how much of an influence that’s going to be in terms of modeling the year. Okay, well I have some others I’ll come back into the queue. Okay thanks.

Okay thank you, Brian.

[Operator Instructions] Our next question comes from the line of Al Troy, a Private Investor. Please proceed with your questions.

Hi gentlemen. I’d like to congratulate everybody at Socket for having a record year; it’s quite exciting to see the growth in the Company. Do you still have about 75,000 of the Hudson Bay warrants that are out there?

Yes, Troy we haven’t seen any activity from Hudson Bay since they exercise lot of their warrants in the first quarter a year ago, so remaining warrants that they hold are 75,000 at $1.25.

And they expired in May of this year, is that correct?

On May 20, that’s correct.

Okay, fine. Now I just feel the price of the stock is so ridiculously low in comparison to the earnings growth and amount of profits you are making. Do you have any plans to publicize these results and see people getting some kind of PR firm or something?

Let me start. Yes, go ahead Kevin.

So, yes I would do. But I think our first goal is to get back on NASDAQ because the flow of information once on the NASDAQ market makes U.S. stock much more available to many people, right. So we are now quite slow and I think on the back of getting back on the NASDAQ markets, we will have more aggressive outage scope.

There is no question getting on NASDAQ would be a tremendous event for the Company and certainly effective price of the stock and create more interest in the Company, but I think the prices stock has to be over $3 in order to qualify the NASDAQ?

That’s correct.

Okay. So what I’m saying I think it would be advice of the Company to generate some more interest, let people know what’s going on. I mean these results are incredible and right to the stock I feel should be much higher than it is right now.

Let’s see what happens over the next few weeks. I think the fourth quarter because we had a downturn a year ago and seasonally low results, we are still an uncertainty for many investors. So now that we’ve had a strong fourth quarter and are commenting that we expect the first quarter to also be profitable that will change those receptions. The other thing that will be substantially improved when the quarter’s results of $0.33 for this year, we’ve added $0.17 in the fourth quarter against zero number in the fourth quarter a year ago. So now the trailing 12 months has a much different price earnings ratio and that may increase investors to consider the stock as well. So I think there is a number of mechanisms that will be happening now that our results are published that could be helping move the stock price in the direction we’d all like to see it go.

Right, I think now it’s only selling like seven-time earnings. Okay, gentlemen thanks for your answers and keep up the good work. I’m very pleased with the results.

Thanks.

Our next question comes from the line of Mike Schellinger from MicroCapClub. Please proceed with your question. Mr. Schellinger you may proceed.

Sorry. I was on mute. Can you hear me now?

Yes, we can.

So in Q4 how our sales for the inventory applications, it sounded like most of the growth which is tremendous in Q4 was for the point of sale and maybe not too much in inventory space.

Yes, I mean maybe I should ask this question over to James Lopez. We have a much better handle on how our markets are evolving and maybe James can add a little bit of rise on that - how we saw in 2016 and in Q4?

Yes, to answer directly about the inventory is you are correct, we are still seeing most of the growth coming from mobile point of sale, inventory still follows where we’re starting to see more inventory activity is happening around of our durables, which kind of leads into our new DuraScan scanners that we’re going to be coming up with shortly, but the inventory is still coming.

Okay, great. Actually for more upside is tremendous growth in scanner sales revenue in Q4.

[Operator Instructions] We do have a follow-up question from the line of Brian Swift. Please proceed with your question.

Just to follow-on from the last question, can you give us an idea of when you expect to kind of see a ramp up in the new products and the kind of influence that’s going to have on the products used in inventory management as opposed to point of sale? And then also give us a little update on what’s happening in the enterprise side of the picture.

Sure, so we started seeing products like our DuraCase starting to appear at the end of this quarter and our new DuraScan at the beginning of next quarter. DuraCase is great particularly for inventory because it frees up hands as well as provides a much better charging solution and sort of a single hand solution for people doing the inventory work as well as kind of complement that inventory demand that we see coming very well. And then the DuraScan products which were designed around more regular environments needing more durability so concrete floors and freezers and environments whether elements involved that’s going to be coming out in the beginning of Q2, which also services inventory but also can go into other applications in the AIDC space. So that currently fits with our mobile point of sale but it also complements other markets. Enterprise mobility is something that we are also seeing emerge. That’s something that we hope DuraCase will service well, but we also know that our DuraScan is an important product for those environments as well, because we are looking for something that’s tough and they want the insurance of a product that could meet a specification like IP54 and so we designed our DuraScan product around those things.

Okay, thank you.

You’re welcome.

[Operator Instructions] We do have a question comes from the line of [Greg Savory], a Private Investor. Please proceed with your question.

I do, thank you. Do you have anything on the developer number, where you see an increased sale?

Absolutely and we’re always seeing some growth in the developer number so we try not to measure ourselves too much on the developer number itself, it’s much more about the productivity we’re seeing from our developers. So it’s more in maturity of our developer community which is a couple of years old now and as Kevin mentioned in his early remarks we are starting to see a lot of - starting with those relationship a couple of years ago materialize and the deployments that are happening now. So we are always keeping the pipeline flowing with new developers working in new spaces, but a lot of the new developers are starting to come from other areas other than mobile point of sale. Mobile point of sale is typically been our breadbasket for a while. Newer developers are starting to come from other places like Lopez mentioned before enterprise mobility.

So do you guys still [indiscernible] the scanners together in house?

Yes, we do. We can track with manufactures around the world to build the components to our specifications, but final assembly, testing and packaging all comes from our location here in Newark, California.

Thank you guys. It’s been quite rise. So we are excited for the future and good luck.

Thank you.

[Operator Instructions] There are no further questions in the queue. I would like to hand the call back to Kevin Mills for closing comments.

Thank you, operator. I’d just like to thank everyone for participating in today’s call and to wish you all good afternoon. Thank you.

Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time. And have a wonderful day.