Inseego (US:INSG)2024-08-07 23:15Revenue Performance - Revenues for Q2 2024 were $59.1 million, a 10.4% increase from $53.6 million in Q2 2023[97] - Total revenues for the six months ended June 30, 2024 were $104.2 million, slightly down from $104.4 million in the same period of 2023[107] - Mobile solutions revenues decreased by $0.8 million (1.9%) to $41.1 million, while fixed wireless access solutions revenues fell by $3.9 million (12.4%) to $27.5 million[107][108] - Services and other revenues increased by $4.5 million (14.4%) to $35.5 million, driven by a two-year service contract renewal with a major customer[107] Cost and Expenses - Cost of revenues for Q2 2024 was $36.1 million, representing 61.0% of total revenues, down from 64.7% in Q2 2023[98] - Total cost of revenues increased by $1.4 million (4.2%) compared to the same period last year[99] - Cost of revenues for the six months ended June 30, 2024 was $63.7 million, or 61.2% of revenues, down from $67.3 million (64.5%) in the same period of 2023[108] - Total operating costs and expenses for the six months ended June 30, 2024 were $39.8 million, down from $43.9 million in the same period of 2023, reflecting a 9.5% decrease[111] Profitability - Gross profit for Q2 2024 was $23.0 million, with a gross margin of 39.0%, up from $18.9 million and 35.3% in Q2 2023[101] - The company generated a net loss of $3.8 million for the six months ended June 30, 2024, compared to a net loss of $10.0 million for the same period in 2023[128] Research and Development - Research and development expenses for Q2 2024 were $5.5 million, or 9.3% of revenues, down from $6.3 million (11.7%) in Q2 2023[101] Sales and Marketing - Sales and marketing expenses for Q2 2024 were $5.4 million, or 9.1% of revenues, compared to $5.8 million (10.8%) in Q2 2023[102] General and Administrative - General and administrative expenses for Q2 2024 were $5.8 million, or 9.8% of revenues, up from $5.4 million (10.1%) in Q2 2023[102] Cash Flow and Liquidity - For the six months ended June 30, 2024, the company reported a net cash provided by operating activities of $33.3 million, compared to $12.7 million for the same period in 2023[127] - The company executed a Convertible Debt Repurchase, purchasing $45.9 million of 2025 Convertible Notes at a 30% discount, reducing the principal balance of the notes to $113.0 million[120] - As of June 30, 2024, the company had available cash and cash equivalents totaling $49.0 million, which increased to $48.993 million by the end of the period[119][127] - The company received a $15.0 million upfront payment from a customer in April 2024 related to a two-year service contract, positively impacting liquidity[122] - The company’s liquidity could be compromised if there is any interruption in business operations or failure to generate revenue from new or existing products[124] Foreign Currency Exposure - Approximately 17.2% of total revenue for the six months ended June 30, 2024, was generated from sales denominated in foreign currencies, indicating exposure to foreign currency exchange risk[136] Strategic Focus - The company operates as a single business segment, focusing on cloud-managed wireless broadband and intelligent edge solutions[94] - The company emphasizes the importance of developing new products and maintaining strategic relationships to expand into new markets[83] - The 5G product portfolio is designed for mission-critical applications requiring high security and zero downtime[90] - Inseego's mobile hotspots have been sold to millions of end users, providing secure high-speed broadband access[90] Debt and Obligations - The company had approximately $78.2 million in future payments under non-cancellable purchase obligations as of June 30, 2024[124] - The company recorded dividends of $1.6 million and $1.5 million on its Preferred Stock for the six months ended June 30, 2024, and 2023, respectively[116] - The company has repurchased and/or entered into agreements to repurchase and/or exchange approximately $141.9 million, or 87.7%, of the face value of the outstanding 2025 Convertible Notes[120]