Revenue increases 12.8% year-over-year to
$173.2 million in the third quarter of 2017
Sierra Wireless, Inc. (NASDAQ: SWIR) (TSX: SW) today reported
results for its third quarter ending September 30, 2017. 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.
“In the third quarter of 2017, we delivered strong revenue and
profitability growth on a year-over-year basis, driven by
performance improvements in each of our three business segments,”
said Jason Cohenour, President and CEO. “We continue to strengthen
our leadership position in the Internet of Things with technology
innovations, new product launches, new customer wins and strategic
acquisitions."
Revenue for the third quarter of 2017 was $173.2 million, an
increase of 12.8% compared to $153.6 million in the third quarter
of 2016. Revenue from OEM Solutions was $138.5 million in the third
quarter of 2017, up 8.4% compared to $127.8 million in the third
quarter of 2016. Revenue from Enterprise Solutions was $26.3
million in the third quarter of 2017, up 38.8% compared to $18.9
million in the third quarter of 2016. Revenue from Cloud and
Connectivity Services was $8.4 million in the third quarter of
2017, up 23.0% compared to $6.9 million in the third quarter of
2016.
GAAP RESULTS
- Gross margin was $57.8 million, or
33.3% of revenue, in the third quarter of 2017, compared to $49.4
million, or 32.1% of revenue, in the third quarter of 2016.
- Operating expenses were $57.5 million
and earnings from operations were $0.2 million in the third quarter
of 2017, compared to operating expenses of $49.4 million and a loss
from operations of $0.1 million in the third quarter of 2016.
- Net earnings were $1.2 million, or
$0.04 per diluted share, in the third quarter of 2017, compared to
a net loss of $1.8 million, or $0.06 diluted per share, in the
third quarter of 2016.
NON-GAAP RESULTS
- Gross margin was 33.4% in the third
quarter of 2017, compared to 32.2% in the third quarter of
2016.
- Operating expenses were $48.6 million
and earnings from operations were $9.3 million in the third quarter
of 2017, compared to operating expenses of $43.2 million and
earnings from operations of $6.3 million in the third quarter of
2016.
- Net earnings were $7.6 million, or
$0.23 per diluted share, in the third quarter of 2017, compared to
net earnings of $4.1 million, or $0.13 per diluted share, in the
third quarter of 2016.
- Adjusted earnings before interest,
taxes, depreciation and amortization ("Adjusted EBITDA") were $13.1
million in the third quarter of 2017, compared to $9.7 million in
the third quarter of 2016.
Cash and cash equivalents at the end of the third quarter of
2017 were $74.2 million, representing a decrease of $14.8 million
compared to the end of the second quarter of 2017. The decrease in
cash was primarily due to high working capital requirements.
Acquisition
On August 2, 2017, we entered into a definitive merger agreement
(the "Merger Agreement") to acquire Numerex Corp. ("Numerex") in a
stock-for-stock merger transaction (the "Transaction"). Under the
terms of the Merger Agreement, Numerex stockholders will receive a
fixed exchange ratio of 0.18 common shares of Sierra Wireless for
each share of Numerex common stock. Concurrent with closing,
Numerex's debt of approximately $20 million and other obligations
of approximately $4 million will be repaid with cash. We expect the
acquisition to expand our position as a leading global IoT
pure-play and significantly increase our subscription-based
recurring services revenue. On October 23, 2017, the Transaction
was granted early termination of the waiting period pursuant to the
U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976. On
October 30, 2017, the U.S. Securities and Exchange Commission
declared our Registration Statement on Form F-4 (containing the
proxy statement/prospectus relating to the Transaction) effective
under the U.S. Securities Act of 1933 and the proxy
statement/prospectus was mailed to Numerex’s stockholders shortly
thereafter. The special meeting of Numerex stockholders to consider
and vote on the approval of the Transaction has been scheduled for
December 6, 2017. The Transaction is expected to close in December
2017, subject to the receipt of Numerex stockholder approval,
certain regulatory approvals, and satisfaction of other customary
closing conditions.
Financial Guidance
For the fourth quarter of 2017, we expect revenue to be in the
range of $172 million to $180 million and non-GAAP earnings per
share to be in the range of $0.21 to $0.29.
This Non-GAAP guidance reflects current business indicators and
expectations. Inherent in this guidance are risk factors that are
described in greater detail in our regulatory filings. Our actual
results could differ materially from those presented above. All
figures are approximations based on management's current beliefs
and assumptions.
Non-GAAP Financial Measures
We disclose non-GAAP financial measures as we believe they
provide useful information on actual operating performance and
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
nonrecurring costs or recoveries.
Non-GAAP earnings (loss) from operations excludes the impact of
stock-based compensation expense and related social taxes,
amortization related to acquisitions, acquisition-related and
integration expense, restructuring expense, impairment and certain
other nonrecurring costs or recoveries.
In addition to the above, Non-GAAP net earnings (loss) and
non-GAAP earnings (loss) per share exclude the impact of foreign
exchange gains or losses on translation of certain balance sheet
accounts, unrealized 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 expense, restructuring expense,
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 we believe that it 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 capital expenditures.
Conference call and webcast details
Sierra Wireless President and CEO, Jason Cohenour, and CFO,
David McLennan, will host a conference call and webcast with
analysts and investors to review the results on Thursday, November
2, 2017, at 6:00 PM Eastern Time (3:00 PM PT). 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: 75777631
To access the webcast, please follow the link below:
Sierra Wireless Q3 2017 Conference Call and Webcast
If the above link does not work, please copy and paste the
following URL into your browser:
http://event.on24.com/r.htm?e=1494794&s=1&k=14795ECFA155598D365EF53424FC9A09
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 (“forward-looking statements”) including statements
and information relating to our financial guidance for the fourth
quarter of 2017 and our fiscal year 2017, our business outlook for
the short and longer term, statements regarding our strategy, plans
and future operating performance. 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. We do not intend to update or revise our forward-looking
statements unless we are required to do so by securities laws.
Forward-looking statements:
- Typically include words and phrases
about the future such as “outlook”, “will”, “may", “estimates”,
“intends”, “believes”, “plans”, “anticipates” and “expects”.
- 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:
- our ability to develop, manufacture and
sell new products and services that meet the needs of our customers
and gain commercial acceptance;
- our ability to continue to sell our
products and services in the expected quantities at the expected
prices and expected times;
- expected cost of goods sold;
- expected component supply
constraints;
- our ability to win new business;
- our ability to complete the proposed
acquisition of Numerex Corp. ("Numerex"), in December 2017, to
integrate Numerex's business, operations and workforce with ours
and to return the Numerex business to profitable growth and realize
the expected benefits of the acquisition;
- our ability to integrate other acquired
businesses and realize expected benefits;
- expected deployment of next generation
networks by wireless network operators;
- our operations not being adversely
disrupted by component shortages or other development, operating or
regulatory risks; and
- expected tax rates and foreign exchange
rates.
- 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:
- risks related to the proposed
acquisition of Numerex;
- competition from new or established
cloud and connectivity service providers or from those with greater
resources;
- disruption of, and demands on, our
ongoing business and diversion of management's time and attention
in connection with other acquisitions or divestitures;
- the loss of any of our significant
customers;
- cyber-attacks or other breaches of our
information technology security;
- difficult or uncertain global economic
conditions;
- our financial results being subject to
fluctuation;
- our ability to attract or retain key
personnel;
- 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 ability to respond to changing
technology, industry standards and customer requirements;
- our reliance on single source suppliers
for certain components used in our products;
- failures of our products or services
due to design flaws and errors, component quality issues,
manufacturing defects or other quality issues;
- our dependence on a limited number of
third party manufacturers;
- unanticipated costs associated with
litigation or settlements;
- our dependence on wireless network
carriers to offer and promote acceptable wireless service
programs;
- risks related to contractual disputes
with counterparties;
- risks related to governmental
regulation;
- risks related to the transmission, use
and disclosure of user data and personal information; and
- risks inherent in foreign
jurisdictions.
About Sierra WirelessSierra Wireless (NASDAQ: SWIR) (TSX:
SW) is building the Internet of Things with intelligent wireless
solutions that empower organizations to innovate in the connected
world. Customers start with Sierra because we offer the industry’s
most comprehensive portfolio of 2G, 3G and 4G embedded modules and
gateways, seamlessly integrated with our secure cloud and
connectivity services. OEMs and enterprises worldwide trust our
innovative solutions to get their connected products and services
to market faster. Sierra Wireless has more than 1,100 employees
globally and operates R&D centers in North America, Europe and
Asia. For more information, visit www.sierrawireless.com.
"AirPrime," "AirLink," and "AirVantage" 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 endedSeptember 30,
Nine months endedSeptember 30,
2017 2016
2017
2016
Revenue $ 173,241 $ 153,560
$ 508,544 $ 452,586 Cost of goods sold
115,466
104,192
335,411 303,639
Gross margin
57,775 49,368
173,133 148,947
Expenses Sales and marketing
18,127 15,519
55,138 47,194 Research and development
21,525 18,015
61,533 55,030 Administration
10,560 11,435
31,525 31,248 Restructuring
199 —
831 —
Acquisition-related and integration
2,077 34
3,403
467 Impairment
— —
3,668 — Amortization
5,049
4,418
14,435 12,905
57,537
49,421
170,533 146,844
Earnings (loss) from
operations 238 (53 )
2,600 2,103 Foreign exchange
gain
1,667 590
6,283 1,811 Other income
32 23
29 81
Earnings before income taxes
1,937 560
8,912 3,995 Income tax expense
710
2,329
1,247 4,328
Net earnings (loss)
$ 1,227 $ (1,769 )
$ 7,665 $ (333 )
Other comprehensive earnings (loss):
Foreign currency translation adjustments,
net of taxesof $nil
3,822 (973 )
11,862 (92 )
Comprehensive earnings
(loss) $ 5,049 $ (2,742 )
$ 19,527
$ (425 ) Net earnings (loss) per share (in dollars) Basic
$ 0.04 $ (0.06 )
$ 0.24 $ (0.01 )
Diluted
0.04 (0.06 )
0.23 (0.01 )
Weighted average number of shares
outstanding (inthousands)
Basic
32,200 32,043
32,093 32,055 Diluted
32,735 32,043
32,665 32,055
SIERRA WIRELESS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars, except where
otherwise stated)
(unaudited)
September 30, 2017 December 31,
2016
Assets Current assets Cash and cash equivalents
$ 74,206 $ 102,772
Accounts receivable, net of allowance for
doubtful accounts of $1,883(December 31, 2016 - $2,486)
148,134 143,798 Inventories
56,987 40,913 Prepaids
and other
6,463 6,530
285,790 294,013
Property and equipment
36,566 34,180 Intangible assets
67,298 74,863 Goodwill
167,062 154,114 Deferred
income taxes
16,954 16,039 Other assets
10,419
5,250
$ 584,089 $ 578,459
Liabilities Current liabilities Accounts payable and
accrued liabilities
$ 144,902 $ 167,500 Deferred
revenue and credits
3,666 5,263
148,568
172,763 Long-term obligations
34,035 32,654 Deferred income
taxes
11,493 11,458
194,096
216,875
Equity Shareholders’ equity
Common stock: no par value; unlimited
shares authorized; issued and
outstanding: 32,219,652 shares (December
31, 2016 -31,859,960 shares)
349,598 342,450 Preferred stock: no par value; unlimited
shares authorized;
issued and outstanding: nil shares
— —
Treasury stock: at cost: 225,440 shares
(December 31, 2016 – 355,471shares)
(3,256 ) (5,134 ) Additional paid-in capital
25,786 24,976 Retained earnings
20,429 13,718
Accumulated other comprehensive loss
(2,564 ) (14,426
)
389,993 361,584
$
584,089 $ 578,459
SIERRA WIRELESS, INC.
CONSOLIDATED STATEMENTS OF CASH
FLOWS
(In thousands of U.S. dollars)
(unaudited)
Three months endedSeptember 30, Nine months
endedSeptember 30,
2017 2016
2017
2016 Cash flows provided by (used in):
Operating activities Net earnings (loss)
$
1,227 $ (1,769 )
$ 7,665 $ (333 ) Items not
requiring (providing) cash Amortization
7,548 6,577
21,739 18,851 Stock-based compensation
2,769 1,847
7,472 5,784 Deferred income taxes
(36 ) —
(1,340 ) — Impairment
— —
3,668 —
Unrealized foreign exchange (gain) loss
(2,202
) 120
(8,046
) (1,423 ) Other
(43 ) (93 )
(225
) (204 ) Changes in non-cash working capital Accounts
receivable
(12,819 ) 7,144
749 (4,190 )
Inventories
9,047 (2,213 )
(14,193 ) 10,964
Prepaids and other
(215 ) 3,514
(4,753
) 3,455 Accounts payable and accrued liabilities
(16,977 ) 7,763
(25,559 ) 13,462
Deferred revenue and credits
(343 ) 1,705
(1,643 ) 958 Cash flows provided by (used in)
operating activities
(12,044
) 24,595
(14,466
) 47,324
Investing activities Additions to
property and equipment
(2,939 ) (4,540 )
(10,879 ) (12,810 ) Additions to intangible assets
(288 ) (201 )
(1,385 ) (737 ) Proceeds
from sale of property and equipment
— —
27 3
Acquisition of GNSS business
— —
(3,145 ) —
Acquisition of GenX Mobile Incorporated, net of cash acquired
— (5,900 )
— (5,900 ) Cash flows used
in investing activities
(3,227 ) (10,641 )
(15,382 ) (19,444 )
Financing activities
Issuance of common shares
363 98
5,285 1,569
Repurchase of common shares for cancellation
— —
(2,779 ) (6,206 ) Purchase of treasury shares for RSU
distribution
— —
— (4,214 ) Taxes paid related to net
settlement of equity awards
(7 ) (13 )
(1,096
) (790 ) Payment for contingent consideration
(161
) —
(1,397 ) (16 ) Decrease in other long-term
obligations
(106 ) (152 )
(340 ) (290 )
Cash flows provided by (used in) financing activities
89
(67 )
(327 ) (9,947 ) Effect of foreign
exchange rate changes on cash and cash equivalents
376
(266 )
1,609
185 Cash and cash equivalents, increase (decrease) in
the period
(14,806 ) 13,621
(28,566 )
18,118 Cash and cash equivalents, beginning of period
89,012
98,433
102,772 93,936
Cash
and cash equivalents, end of period $ 74,206
$ 112,054
$ 74,206 $ 112,054
SIERRA WIRELESS, INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
BY QUARTER
(in thousands of U.S. dollars, exceptwhere
otherwise stated)
2017 2016 Q3 Q2
Q1 Total Q4 Q3
Q2 Q1 Gross margin - GAAP
$ 57,775 $ 59,697 $ 55,661 $ 217,743 $ 68,796 $ 49,368 $ 52,764 $
46,815
Stock-based compensation andrelated social
taxes
123 108 108 420 99 108 107 106
Realized gains (losses) on
hedgecontracts
12 — — — — — — —
Other nonrecurring costs(recoveries)
$ — — — (13,045 ) (13,045 ) — —
—
Gross margin - Non-GAAP
$ 57,910 $ 59,805 $ 55,769 $ 205,118 $ 55,850 $ 49,476 $ 52,871 $
46,921
Earnings (loss) from operations
-GAAP
$ 238 $ 3,849 $ (1,487 ) $ 21,348 $ 19,245 $ (53 ) $ 3,411 $ (1,255
)
Stock-based compensation andrelated social
taxes
2,780 2,577 2,148 7,596 1,845 1,856 1,902 1,993
Acquisition-related andintegration
2,077 875 451 843 376 34 59 374 Restructuring 199 259 373 — — — — —
Other nonrecurring costs(recoveries)
— 42 276 (11,762 ) (13,045 ) 1,283 — —
Realized gains (losses) on
hedgecontracts
210 — — — — — — — Impairment — — 3,668 — — — — —
Acquisition-related amortization 3,845 3,694 3,641
12,102 3,308 3,206 3,058 2,530
Earnings from operations -
Non-GAAP
$ 9,349 $ 11,296 $ 9,070 $ 30,127 $ 11,729 $ 6,326 $ 8,430 $ 3,642
Net earnings (loss) - GAAP $ 1,227 $ 6,649 $ (211 ) $
15,385 $ 15,718 $ (1,769 ) $ 718 $ 718
Stock-based compensation andrelated social
taxes, restructuring,impairment, acquisition-related,integration
and othernonrecurring costs (recoveries)
5,056 3,753 6,916 (3,323 ) (10,824 ) 3,173 1,961 2,367 Amortization
7,548 7,194 6,997 25,894 7,043 6,577 6,706 5,568 Interest and
other, net (32 ) 12 (9 ) (83 ) (2 ) (23 ) (32 ) (26 ) Foreign
exchange loss (gain) (1,457 ) (3,517 ) (1,099 ) 1,736 3,547 (590 )
1,071 (2,292 ) Income tax expense (recovery) 710 705
(168 ) 4,310 (18 ) 2,329 1,654 345
Adjusted EBITDA 13,052 14,796 12,426 43,919 15,464 9,697
12,078 6,680
Amortization (exclude acquisition-related
amortization)
(3,703 ) (3,500 ) (3,356 ) (13,792 ) (3,735 ) (3,371 ) (3,648 )
(3,038 ) Interest and other, net 32 (12 ) 9 83 2 23 32 26 Income
tax expense - Non-GAAP (1,791 ) (1,591 ) (1,418 ) (8,241 ) (2,900 )
(2,208 ) (2,086 ) (1,047 )
Net earnings - Non-GAAP $ 7,590 $
9,693 $ 7,661 $ 21,969 $ 8,831 $ 4,141 $ 6,376 $ 2,621
Diluted net earnings (loss)
pershare
GAAP - (in dollars per share) $ 0.04 $ 0.20 $ (0.01 ) $ 0.48 $ 0.49
$ (0.06 ) $ 0.02 $ 0.02 Non-GAAP - (in dollars per share) $ 0.23 $
0.30 $ 0.24 $ 0.68 $ 0.27 $ 0.13 $ 0.20 $ 0.08
SIERRA WIRELESS, INC.
SEGMENTED RESULTS
(In thousands of U.S. dollars, except
whereotherwise stated)
2017 2016 Q3 Q2
Q1 Total Q4 Q3
Q2 Q1 OEM Solutions
Revenue $ 138,531 $ 144,561 $ 133,000 $ 516,517 $ 135,211 $ 127,765
$ 132,667 $ 120,874 Gross margin (2) (3) - GAAP $ 41,161 $ 46,323 $
42,078 $ 166,596 $ 54,110 $ 37,191 $ 41,005 $ 34,290 - Non-GAAP $
41,268 $ 46,413 $ 42,167 $ 154,988 $ 42,232 $ 37,280 $ 41,096 $
34,380 Gross margin % (2) (3) - GAAP 29.7 % 32.0 % 31.6 % 32.3 %
40.0 % 29.1 % 30.9 % 28.4 % - Non-GAAP 29.8 % 32.1 % 31.7 % 30.0 %
31.2 % 29.2 % 31.0 % 28.4 %
Enterprise Solutions
Revenue $ 26,277 $ 21,661 $ 21,718 $ 71,486 $ 20,976 $ 18,938 $
16,577 $ 14,995 Gross margin (1) (2) (3) - GAAP $ 12,631 $ 10,276 $
10,485 $ 39,949 $ 12,002 $ 9,273 $ 8,922 $ 9,752 - Non-GAAP $
12,652 $ 10,289 $ 10,500 $ 38,913 $ 10,930 $ 9,286 $ 8,934 $ 9,763
Gross margin % (1) (2) (3) - GAAP 48.1 % 47.4 % 48.3 % 55.9 % 57.2
% 49.0 % 53.8 % 65.0 % - Non-GAAP 48.1 % 47.5 % 48.3 % 54.4 % 52.1
% 49.0 % 53.9 % 65.1 %
Cloud and Connectivity
Services Revenue $ 8,433 $ 7,288 $ 7,075 $ 27,604 $ 6,834 $
6,857 $ 6,985 $ 6,928 Gross margin - GAAP $ 3,983 $ 3,098 $ 3,098 $
11,198 $ 2,684 $ 2,904 $ 2,837 $ 2,773 - Non-GAAP $ 3,990 $ 3,103 $
3,102 $ 11,217 $ 2,688 $ 2,910 $ 2,841 $ 2,778 Gross margin % -
GAAP 47.2 % 42.5 % 43.8 % 40.6 % 39.3 % 42.4 % 40.6 % 40.0 % -
Non-GAAP 47.3 % 42.6 % 43.8 % 40.6 % 39.3 % 42.4 % 40.7 % 40.1 %
Total Revenue $ 173,241 $ 173,510 $ 161,793 $ 615,607
$ 163,021 $ 153,560 $ 156,229 $ 142,797 Gross margin - GAAP $
57,775 $ 59,697 $ 55,661 $ 217,743 $ 68,796 $ 49,368 $ 52,764 $
46,815 - Non-GAAP $ 57,910 $ 59,805 $ 55,769 $ 205,118 $ 55,850 $
49,476 $ 52,871 $ 46,921 Gross margin % - GAAP 33.3 % 34.4 % 34.4 %
35.4 % 42.2 % 32.1 % 33.8 % 32.8 % - Non-GAAP 33.4 % 34.5 % 34.5 %
33.3 % 34.3 % 32.2 % 33.8 % 32.9 %
(1) Q1 2016 Enterprise Solutions results include a $1.9 million
recovery from a legal settlement with a supplier related to a
quality issue with a component used in some of our gateway
products. Excluding this recovery, GAAP and Non-GAAP gross margin
percentage would have been 52.4% and 52.5%, respectively.(2) Q2
2016 OEM Solutions results include a $1.7 million recovery from
certain legal costs pursuant to a favorable arbitration decision on
a contract dispute with an intellectual property licensor.
Excluding this recovery, GAAP and Non-GAAP gross margin percentage
would have been 29.6% and 29.7%, respectively. Q2 2016 Enterprise
Solutions results also include a $0.2 million recovery from this
arbitration decision. Excluding this recovery, GAAP and Non-GAAP
gross margin percentage would have been 52.7% and 52.8%,
respectively.(3) Q4 2016 OEM Solutions and Enterprise Solutions
GAAP gross margins include a favorable impact of $12.9 million and
$1.5 million, respectively, of a change in estimate on accrued
royalty obligations. This is comprised of two components, an amount
of $11.7 million and $1.3 million, respectively, related to a
one-time reduction effective October 1, 2016 (excluded from
non-GAAP gross margin), and a $1.2 million and $0.2 million,
respectively, favorable impact related to royalties accrued on the
products sold in Q4, 2016 (included in non-GAAP gross margin).
View source
version on businesswire.com: http://www.businesswire.com/news/home/20171102006782/en/
Sierra Wireless, Inc.Investor and Media
Contact:David Climie, +1 604-231-1137Vice President, Investor
Relationsdclimie@sierrawireless.comorInvestor Contact:David
G. McLennan, +1 604-231-1181Chief Financial Officer
Sierra Wireless (NASDAQ:SWIR)
Historical Stock Chart
From Mar 2024 to Apr 2024
Sierra Wireless (NASDAQ:SWIR)
Historical Stock Chart
From Apr 2023 to Apr 2024