Inseego Corp. (NASDAQ:INSG) Q4 2024 Earnings Conference Call February 19, 2025 5:00 PM ET Company Participants Juho Sarvikas - CEO Steven Gatoff - CFO Conference Call Participants Scott Searle - ROTH Capital Lance Vitanza - TD Cowen Tore Svanberg - Stifel Operator Hello, and welcome to Inseego Corp's Fourth Quarter and Full Year 2024 Financial Results Conference Call. Please note that today's event is being recorded. All participants today will be in a listen-only mode. [Operator Instructions] After today's ...

Revenue Performance - Total revenues for the year ended December 31, 2024, were $191.2 million, an increase of $24.0 million, or 14.3%, compared to 2023[207] - Mobile solutions revenue increased by $18.4 million, or 22.9%, primarily due to increased sales of premium 5G MiFi devices[207] - Fixed wireless access solutions revenue decreased by $7.3 million, or 13.2%, compared to the previous year[207] - Product revenues totaled $146.6 million, an increase of $11.2 million, or 8.3%, from 2023[207] - Services and other revenue increased by $12.8 million, or 40.1%, reaching $44.7 million[207] Profitability - Gross profit for 2024 was $68.8 million, representing a gross margin of 36.0%, compared to 21.4% in 2023[206] - Operating income for 2024 was $1.7 million, a significant improvement from an operating loss of $36.0 million in 2023[206] - Cost of revenues for 2024 was $122.4 million, or 64.0% of revenues, down from $131.5 million, or 78.6% of revenues in 2023, reflecting a $9.1 million decrease[209] - Gross profit for 2024 was $68.8 million, with a gross margin of 36.0%, compared to $35.8 million and 21.4% in 2023, driven by higher revenues and reduced inventory reserves[211] Expenses and Investments - Research and development expenses increased to $20.6 million, or 10.8% of revenues, from $19.7 million, or 11.8% of revenues in 2023[214] - Operating costs and expenses decreased to $67.1 million in 2024, down from $71.7 million in 2023, reflecting a 6.5% reduction[214] Cash Flow and Liquidity - The company generated positive cash flow from operations of $26.7 million in 2024, compared to $3.8 million in 2023[230] - Net cash provided by operating activities for the year ended December 31, 2024 was $26.7 million, with $15.5 million from working capital[231] - Net cash provided by investing activities for the year ended December 31, 2024 was primarily $48.1 million from the divestiture of the Telematics Business[234] - Net cash used in financing activities for the year ended December 31, 2024 included $33.8 million from repurchases of convertible notes and $19.5 million from the repayment of a short-term loan[236] Business Divestitures - The company divested its Telematics Business for approximately $52 million in cash, completed on November 27, 2024[187] - The company completed the sale of its Telematics Business in November 2024, resulting in cash proceeds of $52.0 million[227] - Income from discontinued operations increased to $18.9 million in 2024, compared to a loss of $1.2 million in 2023, primarily due to the gain on the sale of the Telematics business[222] Debt and Financial Position - Debt restructuring improved the company's liquidity position, exchanging $146.9 million of convertible notes for $33.8 million in cash and other securities[191] - The company recorded a net loss on debt restructurings of $2.9 million in 2024, related to the restructuring of 2025 Convertible Notes[218] - As of December 31, 2024, the company had cash and cash equivalents totaling $39.6 million, with a principal balance of $14.9 million in 2025 Convertible Notes maturing on May 1, 2025[225] - Total fixed-rate borrowings under the 2029 Senior Secured Notes and 2025 Convertible Notes as of December 31, 2024 were $40.9 million and $14.9 million, respectively[242] Foreign Currency Impact - Sales denominated in foreign currencies were approximately 9.8% of total revenue for the fiscal year ended December 31, 2024[246] - A hypothetical 10% change in foreign currencies could have increased or decreased revenue by approximately $1.9 million[246] Previous Year Comparison - Cash inflows from continuing operations for the year ended December 31, 2023 were $3.8 million, with $8.7 million from working capital[232] - Net cash used in investing activities for the year ended December 31, 2023 was $8.1 million related to software development[235] - The company recorded a net loss from continuing operations of $45.0 million for the year ended December 31, 2023, offset by non-cash charges totaling $39.6 million[233]

Core Insights - Inseego reported $48.09 million in revenue for Q4 2024, a year-over-year increase of 12.5% [1] - The EPS for the same period was $0.04, a significant improvement from -$0.89 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $45.57 million by 5.53% [1] - The EPS surprise was 100.00% compared to the consensus estimate of $0.02 [1] Revenue Breakdown - Mobile solutions revenue was $25.50 million, surpassing the estimated $23.75 million [4] - Product revenues reached $35.93 million, exceeding the average estimate of $33.20 million [4] - Services and other revenues were $12.16 million, slightly above the estimated $12.15 million [4] - Fixed wireless access solutions generated $10.43 million, compared to the average estimate of $9.40 million [4] Stock Performance - Inseego shares returned +8.3% over the past month, outperforming the Zacks S&P 500 composite's +2.4% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market [3]

Q4 AND 2024 EARNINGS RESULTS February 19, 2025 New CEO Juho Sarvikas | Leadership Rooted in Wireless Innovation On January 6, 2025, Juho Sarvikas, the former President of Qualcomm North America joined Inseego as CEO and board member. Proven Leadership in Wireless Technology – As CEO, Juho Sarvikas brings a strategic vision focused on leveraging engineering excellence to drive technology and product leadership in the wireless market. Extensive Global Executive Experience – Over two decades of expertise in st ...

Financial Performance - Q4 2024 revenue was $48.1 million, with full year 2024 revenue totaling $191.2 million[4] - Q4 2024 Adjusted EBITDA was $5.4 million, while full year 2024 Adjusted EBITDA reached $20.5 million[4] - GAAP gross margin for Q4 2024 was 37.3%, compared to 36.0% for the full year 2024[4] - Total revenues for Q4 2024 reached $48,087 million, a 34% increase from $35,919 million in Q4 2023[24] - Mobile solutions revenue grew to $25,499 million, up 59% from $16,029 million year-over-year[24] - Gross profit for the year ended December 31, 2024, was $68,797 million, compared to $35,776 million in 2023, reflecting a significant improvement[24] - Operating income for Q4 2024 was $1,790 million, a recovery from an operating loss of $7,752 million in Q4 2023[24] - Net income for the year ended December 31, 2024, was $4,572 million, a turnaround from a net loss of $46,185 million in 2023[28] - Total revenues for the year ended December 31, 2024, reached $191,244 million, a significant increase compared to $167,286 million for the year ended December 31, 2023, representing a growth of approximately 14.3%[30] - Mobile solutions revenue for Q4 2024 was $25,499 million, up from $16,029 million in Q4 2023, indicating a year-over-year increase of about 59.5%[30] - The company reported a gross profit of $68,797 million for the year ended December 31, 2024, compared to $35,776 million for the year ended December 31, 2023, reflecting an increase of approximately 92.2%[30] - Operating income for the year ended December 31, 2024, was $1,715 million, a recovery from an operating loss of $35,957 million in the previous year[30] - The net income attributable to common stockholders for Q4 2024 was $1,303 million, a turnaround from a net loss of $1,410 million in Q4 2023[30] - The company incurred total operating costs and expenses of $67,082 million for the year ended December 31, 2024, compared to $71,733 million in 2023, showing a decrease of approximately 6.5%[30] - Adjusted EBITDA from continuing operations for Q4 2024 was $20,455 million, a significant improvement from $8,663 million in Q4 2023[34] - The company reported a loss on debt restructurings of $2,851 million for the year ended December 31, 2024, compared to a loss of $44,973 million in 2023, indicating a reduction in financial distress[30] - The income tax provision for the year ended December 31, 2024, was $689 million, compared to a tax benefit of $43 million in 2023, reflecting a shift towards profitability[30] Strategic Initiatives - The company completed the sale of its Telematics business for $52.7 million in cash[8] - Approximately $147 million, or 91%, of the $162 million of convertible notes outstanding as of December 31, 2023, have been repurchased or exchanged[5] - Q1 2025 revenue guidance is projected to be in the range of $30.0 million to $33.0 million[8] - Q1 2025 Adjusted EBITDA guidance is expected to be between $2.0 million and $3.0 million[8] - The company achieved its highest quarterly MiFi X PRO sales ever with a major North American carrier[8] - The company is focused on expanding its solution portfolio and customer base to drive year-on-year growth in 2025[2] - The company appointed Juho Sarvikas as the new Chief Executive Officer[8] Research and Development - Research and development expenses for the year were $20,596 million, slightly up from $19,725 million in 2023, indicating continued investment in innovation[24] - The company is investing $200 million in R&D for new technologies aimed at enhancing user experience[12] Market Performance - User base grew to 150 million active users, a 10% increase compared to the previous quarter[12] - Market expansion efforts in Asia resulted in a 25% increase in market share in the region[12] - The company plans to enter the European market by Q1 2024, targeting a revenue contribution of $1 billion in the first year[12] - Customer retention rate increased to 85%, reflecting improved user satisfaction and engagement[12] Product Development - New product launches contributed to a 20% increase in sales in the last quarter[12] - The company completed a strategic acquisition of a tech startup for $50 million to bolster its product offerings[12] - Gross margin improved to 45%, up from 42% in the previous quarter[12]

Q4 2024 revenue of $48.1 millionQ4 2024 positive Adjusted EBITDA of $5.4 million and GAAP Operating Income of $1.8 millionCompleted sale of telematics business for $52.7 million in cashCompleted convertible debt restructurings with material reductions in debt SAN DIEGO, Feb. 19, 2025 (GLOBE NEWSWIRE) -- Inseego Corp. (Nasdaq: INSG) (the “Company”), a technology leader in 5G mobile and fixed wireless solutions for mobile network operators, Fortune 500 enterprises and SMBs, today reported its results for the ...

Core Viewpoint - Inseego Corp. has undergone significant leadership changes, with Phil Brace stepping down as Executive Chairman to become CEO of Skyworks Solutions, while Jeff Tuder has been appointed as the independent Chairman of the Board [2][4][5] Leadership Changes - Phil Brace has transitioned from Executive Chairman of Inseego to CEO of Skyworks Solutions, following a successful overhaul of Inseego's capital structure and management team [2][3] - Jeff Tuder, who has been on Inseego's Board since 2017, has been appointed as the independent Chairman of the Board, effective immediately [4][5] Company Transformation - Under Brace's leadership, Inseego completed a major overhaul of its capital structure, reducing total debt and improving liquidity [3] - The company successfully divested its non-core international telematics business and strengthened its management team with key executive hires, including Juho Sarvikas as the new CEO [3] Future Outlook - Juho Sarvikas expressed commitment to driving continued value creation for stockholders and emphasized the company's mission to become a leading provider of wireless connectivity solutions [5] - The Board is actively seeking candidates with relevant industry experience to join the Board of Directors as part of its ongoing governance process [5] Financial Guidance - Inseego announced that there was no change to its financial guidance for the fourth quarter of 2024, which will be reported on February 19, 2025 [6]

Group 1 - The article expresses a negative outlook on Inseego (NASDAQ: INSG), previously known as Novatel, citing that the stock is overpriced relative to its business performance and growth rate [1] - The author has a background in investment analysis, focusing on deep-discount value plays and has been involved in identifying underappreciated companies for over 25 years [1] Group 2 - No relevant content available for this section [2][3]

SAN DIEGO, Jan. 23, 2025 (GLOBE NEWSWIRE) -- Inseego Corp. (Nasdaq: INSG), a technology leader in 5G mobile and fixed wireless solutions for mobile network operators, Fortune 500 enterprises and SMBs, today announced that the company will release its financial results for the fourth quarter and year ended December 31, 2024, after the financial markets close on February 19, 2025. The financial statements and earnings press release will be made available at www.inseego.com and will be filed under Inseego’s p ...

Inseego’s leading 5G FWA solutions for business connectivity now available through T-Mobile Partner Plus ProgramSAN DIEGO, Jan. 13, 2025 (GLOBE NEWSWIRE) -- Inseego Corp. (Nasdaq: INSG), a technology leader in 5G mobile and fixed wireless solutions for mobile network operators, Fortune 500 enterprises, government, and SMBs, is excited to announce its inclusion in the recently launched T-Mobile Partner Plus program. This initiative aligns with Inseego’s mission to facilitate a smooth and cost-effective trans ...