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Good day. And welcome to the Immersion Corporation Q1 2020 Earnings Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Aaron Akerman. Please go ahead.

Good afternoon. And thank you for joining us today on Immersion’s first quarter 2020 conference call. This call is also being broadcast live over the web and can be accessed from the Investor Relations section of our website at www.immersion.com. With me on today’s call is Ramzi Haidamus, President and CEO. During this call, we may make forward-looking statements, which may include any expectations, projections or other characterizations of future events or circumstances and include statements regarding the impact of COVID-19 on our business and the business of our customers and suppliers, as well as on the economy in general and also include projected financial results or operating metrics, business strategies, litigation or absence of litigation, anticipated future products, future expense reductions, anticipated tax expenses, anticipated market demand or opportunities, our operating model and other forward-looking topics. These statements are subject to risks, uncertainties and assumptions, especially in light of the ongoing adverse effects of the COVID-19 global pandemic. Many of these risks and uncertainties are beyond the control of Immersion. For a more detailed discussion of these factors and other factors that could cause actual results to vary materially, interested parties should review the Risk Factors listed in the press release we issued today after market close, Immersion’s annual report on Form 10-K for 2019 and its most recent quarterly report on Form 10-Q, which are on file with the U.S. Securities and Exchange Commission. The forward-looking statements mentioned on this call reflect Immersion’s beliefs and predictions as of today. Except as required by law, Immersion disclaims any obligation to update these forward-looking statements as a result of financial, business or any other developments occurring after the date of this release or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Additionally, please note that during this call, we may discuss non-GAAP financial measures. For each non-GAAP financial measure discussed, a presentation of the most directly comparable GAAP financial measure and a reconciliation of the differences between the non-GAAP financial measure discussed and the most directly comparable GAAP financial measure is available in today’s press release. With that said, I will turn the call over to Ramzi.

Thanks, Aaron. And thanks everyone for joining us on the call today or listening via webcast. First, I’d like to say that our heart go out to those who have been personally affected by COVID-19. At this time, maintaining the health and safety of our employees is paramount. We have implemented a work-from-home policy for our employees worldwide and have suspended all travel. We are focused on enhancing productivity and work-from-home experiences by making certain lab and IT equipment accessible for home use and through connectivity enhancements to bolster our internal communications during this difficult time. I am pleased to report that Immersion’s first quarter revenue grew 22% over the same quarter last year, while non-GAAP operating expenses were down 40%. In addition, we continue to make strong progress on further optimizing Immersion’s cost structure as part of our commitment to maximizing shareholder value. This includes the identification of approximately $3 million in additional savings in fiscal 2020 in areas including legal and litigation, travel and entertainment, and consulting and professional services. We also continue to enhance shareholder value creation through our stock repurchase program. Since initiating buybacks in December, up until the close of market yesterday, we have repurchased close to 4.3 million shares of common stock for an aggregate purchase amount of approximately $26 million. We expect to continue to be active with regard to share buyback activity under the right conditions. Immersion’s balance sheet remains strong and we have approximately $7.1 million remaining under our authorized repurchase program. We remain very confident in the margin strategy that are -- and are fortunate, as a licensing company, we have been able to maintain continuity in conducting our business despite the current environment. We continue to lay the foundation for growth in several of our markets and see concrete signs that our strategy is working. First, as evident in this quarter’s results, our mobility revenue positively reflects the addition of significant mobile OEM license agreements that materialized after the first quarter of last year. In auto, we recently expanded our product partnership with Alps Alpine. We are pleased that Alps Alpine took a software license to our active licensing technology for its touch feedback devices. Together, Immersion and Alps Alpine are developing solutions to deliver high quality, high fidelity and quick to respond tactile effect for improved user experiences in automotive human machine interfaces. Active Sensing technology is an advancement beyond standard haptic software technologies. It provides real-time control over actuator vibrations, enabling clean, crisp and instant response to the users’ interaction. It uses a robust algorithm to react to actuator’s current state, making command decisions every sub millisecond to produce high fidelity haptic effect. As the first licensee of Immersion’s Active Sensing technology, Alps Alpine can provide advanced realistic touch feedback solutions for automotive HMI applications for buttons, dials, switches and textures in suspended touch displays and services. We currently have over 10 Tier 1 automotive supplier licensees. Our existing licensees supply touch screens, touch pads, button clusters and related control interfaces to a range of OEMs for premium vehicles. To support growth, we will license additional Tier 1 customers to expand the number of suppliers with haptic enabled solutions. We also are engaged with OEMs to demonstrate the value of haptics and influence their design decisions. We look forward to keeping you updated on how our partnership and activities are converting into additional design wins in the future. In gaming, we continue to be excited about the significant growth catalyst toward the end of this year with the anticipated launch of Sony’s PlayStation 5 gaming console, where Immersion stands to benefit from Sony’s license of our haptic technology for gaming and VR controllers. We believe Sony’s new controllers will catalyze increased market demand for advanced interactive haptic experiences and this may lead to additional opportunities for Immersion in the future. Lastly, as I mentioned on our call, during the first quarter, we were successful in forging a strategic commercial partnership with FeelRobotics, marking Immersion’s foray into licensing our technology to the multi-billion dollar global adult device market. This is just our first step toward monetizing this new market opportunity and we look forward to seeing our efforts unfolds over the coming months or years. As I have said earlier, our management team is working collaboratively with our new Board to optimize our new business and improve profitability to maximize value for shareholders. Until further notice, we do not intend to provide revenue guidance and we are withdrawing prior guidance as we continue to move forward with these efforts. Going forward, we expect to be profitable on a non-GAAP basis for the fiscal year and intend to exit 2020 with an annual non-GAAP operating expense run rate of approximately $21 million to $23 million. I want to thank our employees for upholding our commitment to our customers and continuing to support our business initiatives like coping with the Coronavirus pandemic. We remain confident in our strategy and are focused on executing across the opportunity to unlock Immersion’s full profit and growth potential while delivering long-term shareholder value. With that, I will now turn the call over to Aaron for a review of our Q1 results before opening up the call to your questions.

Thanks, Ramzi. Let me begin by referring you to this afternoon’s press release for information regarding our Q1 2020 financial performance. Total revenue of $6.3 million for Q1 2020 was up 22% from total revenue of $5.1 million in the same quarter last year. Revenue from per unit royalty arrangement was up approximately $1.6 million or 48%, compared with the prior year quarter, mainly driven by $2.5 million in revenues recognized by mobile licensees signed in 2019 and partially offset by declines in the reported royalty bearing shipments by automotive and gaming licensees. Revenue from fixed license fee arrangement was down 26% on a comparable basis, primarily due to a lump sum $0.5 million license fee from one customer recognized in the first quarter of 2019. Recurring revenues represented 96% of revenues in Q1 2020 versus 90% of revenues in the first quarter last year. Our revenue mix for each line of business, typically fluctuates quarterly due to seasonality patterns and for the first quarter of 2020, a breakdown by line of business as a percentage of total revenues was 77% from mobility, 12% from automotive and 11% from gaming. Turning to operating expenses. GAAP operating expenses for the first quarter of 2020 were down 35% to $5.8 million from the comparable period last year. The reduction in expenses for the quarter reflected the impact of $4.2 million lower litigation costs, $1.7 million lower patent maintenance and non-litigation legal costs, as well as $1.4 million lower stock-based compensation expenses. This was partially offset by $0.5 million in restructuring costs related to the movement of administrative positions from San Jose to Montreal and an incremental $0.8 million of accelerated depreciation on leasehold improvements of our San Jose facility. Other income decreased by $0.8 million versus Q1 2019, mainly due to unrealized foreign currency translation losses of $0.5 million, resulting from the impact of the weakening Korean yuan and Canadian dollar against the U.S. dollar on certain balance sheet items and $0.3 million lower investment income due to lower yields and lower cash and short-term investment balances in the first quarter of 2020 versus the same quarter of 2019. Looking at our net results, GAAP net loss for the first quarter of 2020 was $4.8 million or $0.16 per share, a 54% improvement over GAAP net loss of $11 million or $0.35 per share in the same quarter of 2019. In addition to normal GAAP metrics, we use non-GAAP net loss and non-GAAP net loss per share to track our business performance. As a reminder, we define non-GAAP net loss as GAAP net loss adjusted to reflect cash tax expense, stock-based compensation, depreciation and restructuring expenses. Non-GAAP net loss in the first quarter was $2.6 million or $0.08 per share, a 70% improvement over non-GAAP net loss of $8.6 million or $0.28 per share in the same period last year. Let’s move on to the balance sheet. On April 8, 2020, we agreed to provide a provisional deposit to LGE of approximately $5 million for withholding taxes LGE had to pay to the Korean tax authorities on Immersion’s behalf. The deposit will be recorded on our balance sheet under other assets, a long-term asset in the second quarter of 2020. As noted in our previous filings, we believe that there are valid defenses to the claims raised by the Korean tax authorities and we are appealing these in the Korean courts. Note that, under our agreement with LGE, we will be reimbursed to the extent we prevail in the appeal in the Korean court, which we expect will more likely than not be the case, in the event that we do not ultimately provide in our appeal in the Korean court. The deposit will be reported as additional income tax expense on our statement of operations in the period in which we do not ultimately provided. Overall, our balance sheet remained strong with total cash and cash equivalents of $76.2 million as of March 31, 2020. This is a $13 million reduction from $89.5 million as of December 31, 2019. The key driver of the cash reduction was $12 million used in our stock repurchase program during the quarter. Before we open up the call for questions, I’d like to note that if circumstances -- given the circumstances, Ramzi, and I and the support team are all in separate locations. So please bear with us as we take a little extra time to process your question and deliver answers in real time. We appreciate your patience. With that, I will turn the call over to the operator to start Q&A. Operator?

Thank you. [Operator Instructions] We can now take our first question Derek Soderberg from Dougherty & Company. Please go ahead.

Hi, everyone. Thanks for taking my questions. So given the substantial cuts to operating expenses, are there any strategies or goals that you guys laid out at last year’s Analyst Day that will be any harder to achieve and then I have a follow.

Not at all. Actually the -- this expense -- OpEx cutting plan has been in place for quite some time and what has happened with the Board changes, we pretty much accelerated a lot of the initiatives. These are initiatives that are really in line with the strategy, but just are going to be going under much significant cost reduction effort. For example, moving employees to Montreal for a 35% to 40% savings, changing auditors which we made happen sooner than planned and other very significant changes that are going to continue to pay off in the long-term, all the while making sure that the strategy communicated at the Shareholder Day continue to be intact.

Got it. And then, clearly, auto and mobile will be impacted by the pandemic. Are you seeing strength in gaining in that due to the pandemic -- the pandemic accelerating your prospects in the adult market? Thanks.

I am sorry, you cut -- your connection was a bit bad. Could you please repeat the question?

Yeah. So, clearly, auto and mobile are going to be impacted by the pandemic. On the other side, are you seeing strength in gaming and then also is the pandemic accelerating your prospects in the adult market?

So, on the gaming side, there is a lot of excitement building on the new features set to launch with the PS5 platform. It offers rich experiences, leveraging haptics in controllers and all the signals are that Sony will plan to launch as planned and that there will be uptick there. We are seeing the benefit of the shelter-in-place on software -- on gaming software already and we believe that there will continue to be a lot of stay-at-home activity that could benefit the hardware side as well. So in gaming we feel like we are well-positioned. And as far as the adult market, our action with FeelRobotics continues to be strong. Our sales team is on daily communications with them, and clearly, the market is growing significantly. So we are pretty much tracking to plan in the gaming in the adult world right now. As far as the automotive is concerned, we have pretty much met all our major milestone. We have signed up a lot of the Tier 1s that we planned to sign up in the year. We have been communicating with the OEMs such as Audi, BMW, Mercedes and the next step is to get the OEM -- more OEMs on board with increasing haptic adoption both within the high end, as well as the mid-tier. We have hired a salesperson in the Europe who will be engaged in both the Tier 1s and the OEMs to increase the adoption. So, again, if you take a look at internally at the margins, we are tracking the plan and we don’t see any fundamental changes to demand on haptic.

Great. Thanks.

Sure.