Sierra Wireless, Inc. (NASDAQ: SWIR) (TSX: SW) today reported
results for its first quarter ended March 31, 2020. All results are
reported in U.S. dollars and are prepared in accordance with United
States generally accepted accounting principles (GAAP), except as
otherwise indicated below.
“I'm very pleased with how well our global team at Sierra
Wireless has responded to the COVID-19 situation and worked quickly
to adjust to this challenging environment while focusing on
delivering leading IoT solutions to our customers,” said Kent
Thexton, President and CEO. “Despite some pandemic-related supply
chain disruptions, our Q1 revenue met our expectations and our
recurring revenue win activity was robust in the First
Quarter.”
Revenue for the first quarter of 2020 was $157.6 million
compared to $173.8 million in the first quarter of 2019, a decrease
of 9.3%. Quarterly revenue for our two business segments was as
follows: (i) Revenue from IoT Solutions was $78.8 million in the
first quarter of 2020, a decrease of 16.4% compared to $94.3
million in the first quarter of 2019. Within this segment we had
solid year over year recurring and other service revenue growth of
17% driven by growth in connected devices and the addition of
revenue from the M2M Group acquisition. This growth was offset by
lower hardware sales in Enterprise gateway products and IoT
Solutions modules; and (ii) Revenue from Embedded Broadband at
$78.8 million in the first quarter of 2020 was relatively flat
compared to the first quarter of 2019. This primarily reflects
lower mobile computing module sales as expected, offset by stronger
demand from automotive customers. Recurring and other services
revenue in the first quarter was $26.8 million, representing 17.0%
of consolidated revenue and Product revenue was $130.8 million,
representing 83.0% of consolidated revenue.
GAAP RESULTS
- Gross margin was $43.6 million, or 27.7% of revenue, in the
first quarter of 2020 compared to $54.6 million, or 31.4% of
revenue, in the first quarter of 2019.
- Operating expenses were $65.1 million and loss from operations
was $21.5 million in the first quarter of 2020 compared to
operating expenses of $64.4 million and loss from operations of
$9.8 million in the first quarter of 2019.
- Net loss was $22.7 million, or $0.62 per diluted share, in the
first quarter of 2020 compared to $11.2 million, or $0.31 per
diluted share, in the first quarter of 2019.
- Short-term borrowings were $25.0 million as at March 31, 2020
compared to $nil at December 31, 2019
NON-GAAP RESULTS(1)
- Gross margin was 27.7% in the first quarter of 2020 compared to
31.5% in the first quarter of 2019.
- Loss from operations was $13.8 million in the first quarter of
2020 compared to loss from operations of $0.2 million in the first
quarter of 2019.
- Net loss was $14.7 million, or loss of $0.41 per diluted share,
in the first quarter of 2020 compared to net loss of $0.9 million,
or loss of $0.02 per diluted share, in the first quarter of
2019.
- Adjusted earnings before interest, taxes, depreciation and
amortization ("Adjusted EBITDA") loss were $9.2 million in the
first quarter of 2020 compared to Adjusted EBITDA earnings of $4.5
million in the first quarter of 2019.
(1) See "Non-GAAP Financial Measures" and "Reconciliation of
GAAP and Non-GAAP Results by Quarter" below.
Cash, cash equivalents and restricted cash at the end of the
first quarter of 2020 was $72.8 million, representing a decrease of
$6.3 million from the end of 2019. The decrease in cash was
primarily driven by the acquisition of M2M Group, an operating loss
in the quarter and capital expenditures, partially offset by short-
term borrowings under our revolving credit facility.
COVID-19 Impact
As a result of the evolving COVID-19 outbreak first reported in
Wuhan, China in January 2020, and following government-imposed
restrictions, we delayed the reopening of our Shenzhen office after
Chinese New Year holidays and, in line with local government
directions, the employees of our Hong Kong, Seoul, and Tokyo
offices were guided to work from home as much as possible. Our
Shenzhen office was authorized to reopen on February 24th. During
this period, our employees were able to productively work from
home. These restrictions also affected our manufacturing and
component supplier partners in China due to factory closures,
employees’ inability to work and logistical challenges. While the
work-from-home situation did not directly impact our manufacturing
partner in Vietnam, it was affected by dependencies on component
suppliers in China.
From late February onwards, our manufacturing and supply chain
partners in China gradually reopened production facilities and we
were generally able to mitigate the impact of the manufacturing and
supply chain disruption with only a small impact on our ability to
fulfill customer demand in the first quarter of 2020. We continue
to experience certain supply chain disruptions relating to our
component suppliers located in Malaysia, Philippines and Mexico as
a result of the continuing impact of the COVID 19 pandemic. In
addition, logistics supporting the transportation of goods remains
a challenge for us due to the dramatic reduction of passenger
flights globally and the insufficient capacity of cargo specialized
flights.
We did not experience significant interruption of customer
demand in the first quarter of 2020. However, due to the continuing
impact of the COVID-19 pandemic on our customers, we are facing
weaker-than-expected revenue projections in the second quarter of
2020, driven primarily by significant reduction in the Automotive
outlook. Overall, new design win activity remains strong, and we
believe this underpins long term growth of device and recurring
revenue post the impact of COVID-19. We expect gateway growth to
re-establish itself following the pandemic, driven by
re-vitalization of our Go-to-Market capability and new product
offerings. Also, some segments of our offerings have seen stronger
demand due to COVID-19 but supply chain challenges restrict us from
reacting to all of this demand. We have a strong position in the
automotive module market and expect recovery in this space once
manufacturers restore production and launch additional connected
car platforms.
However, the extent to which COVID-19 may impact our business
will depend on future developments, which are highly uncertain and
cannot be predicted with confidence, such as the geographic spread
of the disease, the duration of the outbreak, business closures or
business disruptions, public health restrictions on travel and
in-person interactions, and the effectiveness of action to contain
and treat the disease in the United States, Europe and the
Asia-Pacific region. We cannot presently predict with accuracy the
duration, scope and severity of any potential business closures or
disruptions, or the overall effects of COVID-19 on our business
over time. Continued shutdowns or other business interruptions
could result in material and negative effects on our ability to
conduct our business in the manner and on the timelines presently
planned, which could have a material adverse impact on our
business, results of operation, and financial condition. The
COVID-19 pandemic continues to rapidly evolve, and we will continue
to monitor the effects of COVID-19 on our business.
Financial Performance and Liquidity
As a result of the near-term COVID 19 pressures on our financial
performance, we have taken measures to reduce our operating
expenditures through initiatives such as deferring salary
increases, reducing executive salaries by 10%, curtailing
discretionary spending, and reducing capital expenditures.
Despite the foregoing uncertainties and our initiatives to
reduce operating expenditures, we believe strongly in our future
growth prospects and our long-term strategy.
On April 30th, the amount available under our revolving bank
credit facility was increased to $50 million, which provides an
additional $20 million of liquidity to the Company. The maturity
date of the facility was also extended from July 2021 to April
2023. We appreciate the ongoing commitment from our banking
partner, Canadian Imperial Bank of Commerce, in backing us with
this increase in our credit facility.
Acquisition of M2M Group
On January 7, 2020, we completed the acquisition of M2M
Connectivity Pty Ltd, M2M One Pty Ltd and D-Square Innovation Pty
Ltd (together, the "M2M Group") in Australia. Total purchase
consideration for the acquisition of M2M Group was $21.1 million,
comprised of cash consideration to the shareholders of $19.6
million for 100% of the equity of M2M Group, plus approximately
$1.3 million for the retirement of certain obligations, and $0.2
million for normal course working capital adjustments. The M2M
Group is focused on IoT connectivity services and cellular devices
in Australia, and the acquisition expands the Company's IoT
Solutions business in the Asia-Pacific region. M2M Group's
contributions were accretive to earnings in the first quarter of
2020. M2M Group contributed revenue of $4.0 million and $0.3
million in net earnings.
Financial Guidance
The impact of COVID-19 pandemic on our global business remains
uncertain. While we continue to evaluate the effects of COVID-19 on
our business, the overall severity and duration of adverse impacts
related to COVID-19 on our business, financial condition, cash
flows and/or results of operations for the second quarter 2020 and
beyond cannot be reasonably estimated at this time. The ultimate
size of the impact of the COVID-19 pandemic on our business will
depend on future developments which cannot be currently
predicted.
Given the uncertainty surrounding the duration and magnitude of
the COVID-19 pandemic, we are unable to provide a reliable outlook
for the balance of 2020 and as a result are withdrawing our
previous guidance for the Full Year 2020 Revenue and Adjusted
EBITDA presented on February 13, 2020. We continue to believe that
our products and solutions make us well-positioned to drive strong
long-term growth in an expanding IoT industry when the global
economy commences recovery from the ongoing COVID-19 crisis.
This non-GAAP guidance constitutes "forward-looking statements"
within the meaning of applicable securities laws and reflects
current business indicators and expectations. These statements are
based on management's current beliefs and assumptions, which could
prove to be significantly incorrect. Forward-looking statements,
particularly those that relate to longer periods of time, are
subject to substantial known and unknown risks and uncertainties
that could cause actual events or results to differ significantly
from those expressed or implied by our forward-looking statements,
including those described in our regulatory filings. See
"Cautionary Note Regarding Forward-Looking Statements" below.
Non-GAAP Financial Measures
We disclose these non-GAAP financial measures as we believe they
provide useful information to investors and analysts to assist them
in their evaluation of our operating results and to assist in
comparisons from one period to another. Readers are cautioned that
non-GAAP financial measures do not have any standardized meaning
prescribed by U.S. GAAP and therefore may not be comparable to
similar measures presented by other companies.
Non-GAAP gross margin excludes the impact of stock-based
compensation expense and related social taxes and certain other
non-recurring costs or recoveries.
Non-GAAP earnings (loss) from operations includes allocation of
realized gains or losses on forward contracts and excludes the
impact of stock-based compensation expense and related social
taxes, acquisition-related amortization, acquisition-related and
integration costs, restructuring costs, impairment and certain
other non-recurring costs or recoveries.
Non-GAAP income tax expense includes certain tax adjustments and
taxes on acquisition-related amortization, acquisition-related and
integration costs, restructuring costs, other non-recurring costs
and foreign exchange.
In addition to the above, non-GAAP net earnings (loss) and
non-GAAP net earnings (loss) per share exclude the impact of
foreign exchange gains or losses on translation of certain balance
sheet accounts, foreign exchange gains or losses on forward
contracts and certain tax adjustments.
We use the above-noted non-GAAP financial measures for planning
purposes and to allow us to assess the performance of our business
before including the impacts of the items noted above as they
affect the comparability of our financial results. These non-GAAP
measures are reviewed regularly by management and the Board of
Directors as part of the ongoing internal assessment of our
operating performance. We also use non-GAAP earnings from
operations as one component in determining short-term incentive
compensation for management employees.
Adjusted EBITDA is defined as net earnings (loss) plus
stock-based compensation expense and related social taxes,
acquisition-related and integration costs, restructuring cost,
impairment, certain other nonrecurring costs or recoveries,
amortization, foreign exchange gains or losses on translation of
certain balance sheet accounts, unrealized foreign exchange gains
or losses on forward contracts, interest and income tax expense.
Adjusted EBITDA is a metric used by investors and analysts for
valuation purposes and is an important indicator of our operating
performance and our ability to generate liquidity through operating
cash flow that will fund future working capital needs and fund
future capital expenditures.
Conference call and webcast details
Sierra Wireless President and CEO, Kent Thexton, and Senior Vice
President, Corporate, David McLennan, will host a conference call
and webcast with analysts and investors to review the results on
Tuesday May 7, 2020, at 6:00 PM Eastern time (3:00 PM Pacific
time). A live slide presentation will be available for viewing
during the call from the link provided below.
To participate in this conference call, please dial the
following number approximately ten minutes prior to the start of
the call:
- Toll-free (Canada and US): 1-877-201-0168
- Alternate number: 1-647-788-4901
- Conference ID: 7784596
To access the webcast, please follow the link below:
Sierra Wireless Q1 2020 Conference Call and Webcast
If the above link does not work, please copy and paste the
following URL into your browser:
https://onlinexperiences.com/scripts/Server.nxp?LASCmd=AI:4;F:QS!10100&ShowUUID=92E538CC-6D84-4B15-A811-A74C6DB93465
The webcast will remain available at the above link for one year
following the call.
Cautionary Note Regarding Forward-Looking Statements
Certain statements and information in this press release are not
based on historical facts and constitute forward-looking statements
or forward-looking information within the meaning of the U.S.
Private Securities Litigation Reform Act of 1995 and Canadian
securities laws (collectively, “forward-looking statements”) and
may include statements and information relating to our 2020
corporate update; financial guidance for our fiscal year 2020; the
impact of COVID-19 on customer demand, our supply chain,
manufacturing capacity and our ability to meet customer demand;
expectations regarding post-COVID-19 recovery; expectations
regarding the Company's cost savings initiatives; expectations
regarding expected earnings of the M2M Group and ability to expand
our market presence in Australia and Southern Asia; our business
outlook for the short and long term; statements regarding our
strategy, plans, goals, objectives, expectations and future
operating performance; the Company's liquidity and capital
resources; the Company's financial and operating objectives and
strategies to achieve them; general economic conditions; estimates
of our expenses, future revenues, non-GAAP earnings per share and
capital requirements; our expectations regarding the legal
proceedings we are involved in; statements with respect to the
Company's estimated working capital; expectations with respect to
the adoption of Internet of Things ("IoT") solutions; expectations
regarding trends and growth in the IoT market and wireless module
market; expectations regarding product and price competition from
other wireless device manufacturers and solution providers; our
ability to implement effective control procedures; and expectations
regarding the launch of fifth generation cellular embedded modules.
Forward-looking statements are provided to help you understand our
views of our short and long term plans, expectations and prospects.
We caution you that forward-looking statements may not be
appropriate for other purposes.
Forward-looking statements:
• Typically include words and phrases about the future such as
"outlook", "will", "may", “expects”, “is expected”, “anticipates”,
“believes”, “plans”, “projects”, “estimates”, “assumes”, “intends”,
“strategy”, “goals”, “objectives”, “potential”, “possible”, or
variations thereof.
• Are not promises or guarantees of future performance. They
represent our current views and may change significantly.
• Are based on a number of material assumptions, including, but
not limited to, those listed below, which could prove to be
significantly incorrect:
- the scope and duration of the COVID-19 pandemic and its impact
on our business;
- our ability to return to normal operations after the COVID-19
pandemic has subsided;
- expected component supply constraints and manufacturing
capacity;
- customer demand and our ability to continue to sell our
products and services in the expected quantities at the expected
prices and expected times;
- our ability to effect and to realize the anticipated benefits
of our business transformation initiatives, and the timing
thereof;
- our ability to develop, manufacture and sell new products and
services that meet the needs of our customers and gain commercial
acceptance;
- expected macro-economic business conditions;
- expected cost of sales;
- our ability to win new business;
- our ability to integrate acquired businesses and realize
expected benefits;
- our ability to renew or obtain credit facilities when
required;
- expected deployment of next generation networks by wireless
network operators;
- our operations not being adversely disrupted by other
developments, operating, cyber security, litigation, or regulatory
risks; and
- expected tax and foreign exchange rates.
• Are based on our management's current expectations and we
caution investors that forward-looking statements, particularly
those that relate to longer periods of time, are subject to
substantial known and unknown material risks and uncertainties.
Many factors could cause our actual results, achievements and
developments in our business to differ significantly from those
expressed or implied by our forward-looking statements, including
without limitation, the following factors. These risk factors and
others are discussed in our Annual Information Form and
Management's Discussion and Analysis of Financial Condition and
Results of Operations, which may be found on SEDAR at www.sedar.com
and on EDGAR at www.sec.gov and in our other regulatory filings
with the Securities and Exchange Commission in the United States
and the provincial securities commissions in Canada:
- prolonged negative impact from COVID-19;
- our access to capital if required;
- competition from new or established competitors or from those
with greater resources;
- natural catastrophes or public health epidemics could impact
customer demand, result in production disruption and impact our
ability to meet customer demand or capacity to continue critical
operations;
- the loss of, or significant demand fluctuations from, any of
our significant customers;
- our financial results being subject to fluctuation;
- our business transformation initiatives may result in
disruptions to our business and may not achieve the anticipated
benefits;
- our ability to respond to changing technology, industry
standards and customer requirements;
- failures of our products or services due to design flaws and
errors, component quality issues, manufacturing defects, network
service interruptions, cyber-security vulnerabilities or other
quality issues;
- deterioration in macro-economic conditions could adversely
affect our operating results and financial conditions;
- our ability to attract or retain key personnel and the impact
of organizational change on our business;
- cyber-attacks or other breaches of our information technology
security;
- risks related to the transmission, use and disclosure of user
data and personal information;
- disruption of, and demands on, our ongoing business and
diversion of management's time and attention in connection with
acquisitions or divestitures;
- risks that the acquisition of M2M Group or our investments and
partnerships may fail to realize the expected benefits;
- risks related to infringement on intellectual property rights
of others;
- our ability to obtain necessary rights to use software or
components supplied by third parties;
- our ability to enforce our intellectual property rights;
- our reliance on single source suppliers for certain components
used in our products;
- our dependence on a limited number of third party
manufacturers;
- unanticipated costs associated with litigation or
settlements;
- our dependence on mobile network operators to promote and offer
acceptable wireless data services;
- risks related to contractual disputes with counterparties;
- risks related to governmental regulation;
- risks inherent in foreign jurisdictions; and
- risks related to tariffs or other trade restrictions.
About Sierra Wireless Sierra Wireless (NASDAQ: SWIR)
(TSX: SW) is the leading IoT solutions provider that combines
devices, network and software to unlock value in the connected
economy. Companies globally are adopting IoT to improve operational
efficiency, create better customer experiences, improve their
business models and create new revenue streams. Whether it is a
solution to help a business securely connect edge devices to the
cloud, or a software/API solution to help manage processes
associated with billions of connected assets, or a platform to
extract real-time data to make the best business decisions, Sierra
Wireless will work with you to create the right industry-specific
solution for your next IoT endeavor. Sierra Wireless has more than
1,300 employees globally and operates R&D centers in North
America, Europe and Asia. For more information, visit
www.sierrawireless.com.
AirPrime, AirLink, AirVantage, mangOH and Legato are trademarks
of Sierra Wireless. Other product or service names mentioned herein
may be the trademarks of their respective owners.
SIERRA WIRELESS, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE EARNINGS (LOSS)
(In thousands of U.S. dollars,
except where otherwise stated)
(unaudited)
Three months ended March 31,
2020
2019
Revenue
IoT Solutions
$
78,790
$
94,287
Embedded Broadband
78,786
79,526
157,576
173,813
Cost of sales
IoT Solutions
50,779
59,808
Embedded Broadband
63,210
59,375
113,989
119,183
Gross margin
43,587
54,630
Expenses
Sales and marketing
24,770
22,506
Research and development
22,149
22,797
Administration
12,135
12,397
Restructuring
615
1,397
Acquisition-related and integration
—
95
Amortization
5,399
5,244
65,068
64,436
Loss from operations
(21,481
)
(9,806
)
Foreign exchange loss
(2,969
)
(852
)
Other (expense) income
(191
)
31
Loss before income taxes
(24,641
)
(10,627
)
Income tax expense (recovery)
(1,978
)
596
Net loss
$
(22,663
)
$
(11,223
)
Other comprehensive loss:
Foreign currency translation adjustments,
net of taxes of $nil
(4,866
)
(3,615
)
Comprehensive loss
$
(27,529
)
$
(14,838
)
Net loss per share (in dollars)
Basic
$
(0.62
)
$
(0.31
)
Diluted
(0.62
)
(0.31
)
Weighted average number of shares
outstanding (in thousands)
Basic
36,277
36,106
Diluted
36,277
36,106
SIERRA WIRELESS, INC.
CONSOLIDATED BALANCE
SHEETS
(In thousands of U.S. dollars,
except where otherwise stated)
(unaudited)
March 31, 2020
December 31, 2019
Assets
Current assets
Cash and cash equivalents
$
70,334
$
75,454
Restricted cash
2,434
3,629
Accounts receivable, net of allowances of
$3,688 (December 31, 2019 - $3,170)
122,920
131,432
Inventories
63,247
54,291
Prepaids and other
20,522
19,256
279,457
284,062
Property and equipment, net
39,507
39,924
Operating lease right-of-use assets
23,786
25,609
Intangible assets, net
79,587
70,072
Goodwill
211,585
207,595
Deferred income taxes
2,013
2,096
Other assets
9,475
9,982
$
645,410
$
639,340
Liabilities
Current liabilities
Short-term borrowings
$
25,000
$
—
Accounts payable and accrued
liabilities
179,347
173,556
Deferred revenue
10,160
10,610
214,507
184,166
Long-term obligations
44,331
43,774
Operating lease liabilities
22,022
25,154
Deferred income taxes
8,953
4,921
289,813
258,015
Equity
Shareholders’ equity
Common stock: no par value; unlimited
shares authorized; issued and outstanding: 36,336,792 shares
(December 31, 2019 - 36,233,361 shares)
437,459
435,532
Preferred stock: no par value; unlimited
shares authorized;
issued and outstanding: nil shares
—
—
Treasury stock: at cost; 5,807 shares
(December 31, 2019 – 44,487 shares)
(48
)
(370
)
Additional paid-in capital
38,543
38,212
Retained deficit
(102,275
)
(78,833
)
Accumulated other comprehensive loss
(18,082
)
(13,216
)
355,597
381,325
$
645,410
$
639,340
SIERRA WIRELESS, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In thousands of U.S.
dollars)
(unaudited)
Three months ended March 31,
2020
2019
Cash flows provided by (used
in):
Operating activities
Net loss
$
(22,663
)
$
(11,223
)
Items not requiring (providing) cash
Amortization
8,485
8,371
Stock-based compensation
3,182
3,158
Deferred income taxes
7
77
Unrealized foreign exchange loss
5,133
254
Other
(148
)
108
Changes in non-cash working capital
Accounts receivable
7,558
16,814
Inventories
(8,674
)
(6,735
)
Prepaids and other
(801
)
(7,647
)
Accounts payable and accrued
liabilities
2,777
(15,166
)
Deferred revenue
(1,298
)
1,371
Cash flows used in operating
activities
(6,442
)
(10,618
)
Investing activities
Additions to property and equipment
(3,999
)
(3,858
)
Additions to intangible assets
(728
)
(488
)
Proceeds from sale of property and
equipment
20
57
Proceeds from sale of iTank business
—
500
Acquisition of M2M Group, net of cash
acquired
(18,219
)
—
Cash flows used in investing
activities
(22,926
)
(3,789
)
Financing activities
Issuance of common shares
—
94
Purchase of treasury shares for RSU
distribution
(26
)
—
Taxes paid related to net settlement of
equity awards
(576
)
(670
)
Decrease in other long-term
obligations
(104
)
(141
)
Proceeds from credit facility
25,000
—
Cash flows provided by (used in) financing
activities
24,294
(717
)
Effect of foreign exchange rate changes on
cash and cash equivalents
(1,241
)
191
Cash, cash equivalents and restricted
cash, decrease in the period
(6,315
)
(14,933
)
Cash, cash equivalents and restricted
cash, beginning of period
79,083
89,297
Cash, cash equivalents and restricted
cash, end of period
$
72,768
$
74,364
SIERRA WIRELESS, INC.
RECONCILIATION OF GAAP AND
NON-GAAP RESULTS BY QUARTER
(In thousands of U.S. dollars, except
where otherwise stated)
2020
2019
Q1
Total
Q4
Q3
Q2
Q1
Gross margin - GAAP
$
43,587
$
219,990
$
51,368
$
55,043
$
58,949
$
54,630
Stock-based compensation and related
social taxes
49
167
20
44
44
59
Realized losses on hedge contracts
(1
)
(4
)
1
—
(2
)
(3
)
Gross margin - Non-GAAP
$
43,635
$
220,153
$
51,389
$
55,087
$
58,991
$
54,686
Earnings (loss) from operations -
GAAP
$
(21,481
)
$
(58,021
)
$
(12,385
)
$
(12,559
)
$
(23,271
)
$
(9,806
)
Stock-based compensation and related
social taxes
3,224
13,194
1,802
3,876
4,102
3,414
Acquisition-related and integration
—
974
274
291
314
95
Restructuring
615
28,160
2,309
6,274
18,180
1,397
Other non-recurring costs
87
2,903
795
279
662
1,167
Impairment
—
877
877
—
—
—
Realized gains (losses) on hedge
contracts
(98
)
(187
)
81
24
(183
)
(109
)
Acquisition-related amortization
3,889
14,514
3,593
3,610
3,624
3,687
Earnings (loss) from operations -
Non-GAAP
$
(13,764
)
$
2,414
$
(2,654
)
$
1,795
$
3,428
$
(155
)
Net loss - GAAP
$
(22,663
)
$
(70,538
)
$
(10,918
)
$
(20,221
)
$
(28,176
)
$
(11,223
)
Stock-based compensation and related
social taxes, restructuring, impairment, acquisition-related,
integration and other non-recurring costs (recoveries)
3,926
46,108
6,057
10,720
23,258
6,073
Amortization
8,485
33,177
8,573
8,115
8,118
8,371
Interest and other, net
191
301
109
121
102
(31
)
Foreign exchange loss (gain)
2,871
1,109
(1,585
)
2,988
(1,037
)
743
Income tax expense (recovery)
(1,978
)
10,920
90
4,577
5,657
596
Adjusted EBITDA
(9,168
)
21,077
2,326
6,300
7,922
4,529
Amortization (exclude acquisition-related
amortization)
(4,596
)
(18,663
)
(4,980
)
(4,505
)
(4,494
)
(4,684
)
Interest and other, net
(191
)
(301
)
(109
)
(121
)
(102
)
31
Income tax expense - Non-GAAP
(739
)
(2,418
)
(176
)
(653
)
(859
)
(730
)
Net earnings (loss) - Non-GAAP
$
(14,694
)
$
(305
)
$
(2,939
)
$
1,021
$
2,467
$
(854
)
Diluted net earnings (loss) per
share
GAAP - (in dollars per share)
$
(0.62
)
$
(1.95
)
$
(0.30
)
$
(0.56
)
$
(0.78
)
$
(0.31
)
Non-GAAP - (in dollars per share)
$
(0.41
)
$
(0.01
)
$
(0.08
)
$
0.03
$
0.07
$
(0.02
)
SIERRA WIRELESS, INC.
SEGMENTED RESULTS
(In thousands of U.S. dollars, except
where otherwise stated)
2020
2019
Q1
Total
Q4
Q3
Q2
Q1
IoT Solutions
Revenue
$
78,790
$
377,808
$
90,937
$
93,439
$
99,145
$
94,287
Gross margin
- GAAP
$
28,011
$
140,158
$
33,665
$
35,203
$
36,811
$
34,479
- Non-GAAP
$
28,035
$
140,222
$
33,676
$
35,203
$
36,833
$
34,510
Gross margin %
- GAAP
35.6
%
37.1
%
37.0
%
37.7
%
37.1
%
36.6
%
- Non-GAAP
35.6
%
37.1
%
37.0
%
37.7
%
37.2
%
36.6
%
Embedded Broadband
Revenue
$
78,786
$
335,705
$
83,364
$
80,586
$
92,229
$
79,526
Gross margin
- GAAP
$
15,576
$
79,832
$
17,703
$
19,840
$
22,138
$
20,151
- Non-GAAP
$
15,600
$
79,931
$
17,713
$
19,884
$
22,158
$
20,176
Gross margin %
- GAAP
19.8
%
23.8
%
21.2
%
24.6
%
24.0
%
25.3
%
- Non-GAAP
19.8
%
23.8
%
21.2
%
24.7
%
24.0
%
25.4
%
Total
Revenue
$
157,576
$
713,513
$
174,301
$
174,025
$
191,374
$
173,813
Gross margin
- GAAP
$
43,587
$
219,990
$
51,368
$
55,043
$
58,949
$
54,630
- Non-GAAP
$
43,635
$
220,153
$
51,389
$
55,087
$
58,991
$
54,686
Gross margin %
- GAAP
27.7
%
30.8
%
29.5
%
31.6
%
30.8
%
31.4
%
- Non-GAAP
27.7
%
30.9
%
29.5
%
31.7
%
30.8
%
31.5
%
Revenue by Type
Product
$
130,743
$
614,384
$
147,760
$
149,396
$
166,348
$
150,880
Recurring and other services
$
26,833
$
99,129
$
26,541
$
24,629
$
25,026
$
22,933
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200507006145/en/
Investor and Media Contact: David Climie Vice President,
Investor Relations +1 (604) 231-1137 dclimie@sierrawireless.com
Investor Contact: David G. McLennan Senior Vice
President, Corporate +1 (604) 231-1181
investor@sierrawireless.com
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