Business Transition and Strategy - The company reported a significant transition from a components provider to a wireless system solutions provider, leveraging its experience in embedded antenna solutions and modems [112]. - The acquisition of NimbeLink Corp. on January 7, 2021, supports the company's strategy to broaden market diversification, particularly in the industrial IoT space [113]. - The company anticipates growth in sales of the AirgainConnect AC-HPUE and related products, which are crucial for future performance [123]. - The automotive market is a key focus, with a strategy to augment sales in the aftermarket and secure design wins with automotive OEMs [117]. - The company plans to continue investing in long-term growth, including expanding its sales force and research and development for new products and technology solutions [145]. Market Performance - The consumer market is experiencing a rebound, although the COVID-19 pandemic has caused historic lows in orders for the core consumer business [121]. - Revenue from the consumer market decreased by $4.2 million to $6.1 million, while revenue from the enterprise market increased by $4.2 million to $8.6 million for the same period [137]. - Total sales for the three months ended March 31, 2022, were $17.5 million, a slight increase of 0.8% compared to $17.4 million for the same period in 2021 [137]. - The company’s sales tend to be lower in the first quarter due to the Chinese New Year, compounded by broader economic impacts from the COVID-19 pandemic [124]. Financial Results - Gross profit for the three months ended March 31, 2022, was $7.2 million, representing a 3.8% increase from $6.9 million in the same period in 2021 [140]. - Operating expenses increased by 9.2% to $9.6 million for the three months ended March 31, 2022, compared to $8.8 million for the same period in 2021 [141]. - Research and development expenses rose by 19.8% to $3.2 million, primarily due to higher personnel-related costs [142]. - The company reported a net loss of $2.5 million for the three months ended March 31, 2022, compared to a net income of $0.2 million in the same period in 2021 [136]. - Cash, cash equivalents, and restricted cash totaled $18.8 million as of March 31, 2022 [144]. - Net cash provided by operating activities was $4.2 million for the three months ended March 31, 2022, driven by a $4.5 million net change in operating assets and liabilities [147]. - The company has an accumulated deficit of $60.0 million as of March 31, 2022 [144]. Operational Challenges - The company has implemented various practices to mitigate the impact of COVID-19 on operations, including remote work and modified customer engagement [120]. - The company’s operating results are affected by pricing pressures, which may force it to lower prices below established list prices [123]. - The company expects research and development expenses to increase in absolute dollars as it invests in new solutions and improving supply chain efficiencies [129]. Regulatory and Reporting - The company is classified as a smaller reporting company under Rule 12b-2 of the Securities Exchange Act of 1934, and is not required to provide detailed market risk disclosures [152].
Airgain(AIRG) - 2022 Q1 - Quarterly Report