Inseego (US:INSG)2025-05-08 23:32Revenue Performance - Revenues for Q1 2025 were $31.7 million, a decrease of 15.5% from $37.5 million in Q1 2024[110] - Mobile solutions revenue increased by $2.5 million (16.5%) to $17.8 million, driven by higher sales of premium 5G MiFi products[110] - Fixed wireless access solutions revenue decreased by $12.3 million (86.6%) to $1.9 million, attributed to reduced sales during the transition to next-generation products[111] - Services and other revenue rose by $3.9 million (48.8%) to $12.0 million, mainly due to a two-year service contract renewal with a major customer[112] Cost and Profitability - Cost of revenues for Q1 2025 was $16.7 million, representing 52.7% of total revenues, down from 64.7% in Q1 2024[112] - Gross profit for Q1 2025 was $15.0 million, with a gross margin of 47.3%, compared to $13.2 million and 35.3% in Q1 2024[115] - Total operating costs and expenses for Q1 2025 were $15.4 million, a decrease of 4.8% from $16.2 million in Q1 2024[116] Expenses - Research and development expenses for Q1 2025 were $4.5 million, representing 14.3% of revenues, down from $4.7 million or 12.5% in Q1 2024[116] - Sales and marketing expenses increased to $3.9 million, or 12.4% of revenues, compared to $3.8 million, or 10.2% in the same period last year[117] - General and administrative expenses rose to $4.5 million, or 14.2% of revenues, up from $4.0 million, or 10.5% in Q1 2024[118] - Depreciation and amortization expenses decreased to $2.1 million, or 6.5% of revenues, from $3.3 million, or 8.8% in Q1 2024[119] Cash Flow and Financial Position - The company reported negative cash outflows from operations of $3.5 million for Q1 2025, primarily due to annual bonus payouts[126] - As of March 31, 2025, the company had cash and cash equivalents of $35.1 million and positive working capital of $7.1 million[126] - Interest expense decreased by $1.2 million to $1.0 million in Q1 2025, a reduction of 52.9% compared to $2.2 million in Q1 2024[121] - The company recorded a net loss from discontinued operations of $0.4 million in Q1 2025, compared to a profit of $1.1 million in Q1 2024[124] - Future payments under non-cancellable purchase obligations were approximately $44.1 million as of March 31, 2025[131] Strategic Decisions - The Company divested its Telematics Business for approximately $52 million in cash to focus on its core 5G wireless solutions[100] - The divestiture aligns with the Company's strategy to streamline operations and reduce leverage[101] - The Company operates a single reportable segment, focusing on consolidated operations and financial results[107] Risks and Challenges - The Company continues to face risks related to customer dependence, competition, and supply chain disruptions[95]