Shelton telecommunications technology maker TranSwitch Corp. stayed in the red in the first quarter, forcing the firm to sell $3 million of its stock to buy time until its latest smartphone and tablet technologies gain traction in the marketplace.
TranSwitch announced Wednesday a sales pact with unnamed buyers for 1.32 million shares of its common at $1.86 each to generate a net $2.4 million for working capital. The gross amount is $2.7 million.
On top of that, the company said it inked a deal with certain insiders, officers and directors among them, to sell them up to 161,150 shares for at least $2.07 apiece to gross another $333,580.
For three months ended March 31, the company lost a net $6.1 million, or 20 cents a fully diluted share, narrower than the net loss of $11.9 million, or 39 cents a share, the same period a year ago.
First-quarter revenues sank to $3.7 million vs. $8.2 million last year.
Last fall, TranSwitch undertook a restructuring, including layoffs, aimed at flattening the operating structure and trimming overhead by at least $3.2 million a year.
"While the results of the first quarter were disappointing, we continue to make progress toward the launch of our new video connectivity business," President and CEO M. Ali Khatibzadeh said in a statement.
The list of potential customers for its HDplay products is growing as it prepares to begin production start probably in the third quarter, Khatibzadeh said.
Meantime, TranSwitch has unveiled its first mobile product, HDmobile, with features aimed at the fast growing market of smart phones and tablets, he said.