Impinj - Interesting Company, Questionable Business
Nov 19, 2024
Impinj (PI) sells and "Internet of Things (IoT)" platform consisting of small, cheap RFID identification chips, along with the readers and software to track them. This allows customers to quickly manage large inventories of items, a key business challenge for many industries like retail, logistics, pharmaceuticals, etc. There's no doubt this is an attractive solution with a burgeoning number of use cases - Impinj should be able to grow at good rates. My issue is the business itself, which has shown little ability to eke out a profit margin or generate free cash flow for almost a decade. There is little profit in selling RFIDs or readers, and Impinj's software platform hasn't been fully realized. That makes it very difficult to pinpoint a reasonable value for the stock. For those reasons, I'm passing on it.
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