Sequans munications S.A.(SQNS) - 2022 Q1 - Quarterly Report

Financial Performance - Revenue for Q1 2022 was $13.9 million, a 12.7% increase year-over-year and a 0.6% increase sequentially from Q4 2021[3] - Gross profit for Q1 2022 was $9.5 million, resulting in a gross margin of 68.1%, up from 50.1% in Q1 2021 and 57.1% in Q4 2021[3] - The operating loss narrowed to $2.0 million in Q1 2022, compared to $4.0 million in Q4 2021 and $5.8 million in Q1 2021[3] - Net profit for Q1 2022 was $2.0 million, or $0.04 per diluted ADS, compared to a net loss of $7.7 million in Q4 2021 and $11.4 million in Q1 2021[9] - Non-IFRS net loss for Q1 2022 was $1.8 million, an improvement from $5.1 million in Q1 2021[10] - Total revenue for Q1 2022 was $13.891 million, a slight increase of 0.6% from $13.810 million in Q4 2021 and a significant increase of 12.8% from $12.321 million in Q1 2021[19] - Product revenue decreased to $5.925 million in Q1 2022, down 14.5% from $6.924 million in Q4 2021 and down 30.5% from $8.548 million in Q1 2021[19] - Services and license revenue increased to $7.966 million, up 15.7% from $6.886 million in Q4 2021 and up 111.5% from $3.773 million in Q1 2021[19] - Gross profit for Q1 2022 was $9.455 million, representing a gross margin of approximately 68% compared to $7.888 million in Q4 2021[19] - Operating loss narrowed to $1.972 million in Q1 2022, an improvement from a loss of $4.029 million in Q4 2021 and $5.830 million in Q1 2021[19] - The company reported a net profit of $2.019 million in Q1 2022, a significant turnaround from a net loss of $7.718 million in Q4 2021 and $11.420 million in Q1 2021[19] - Basic loss per ADS improved to $0.05 in Q1 2022, compared to a loss of $0.21 in Q4 2021 and $0.33 in Q1 2021[19] Cash and Assets - Cash and cash equivalents totaled $26.3 million as of March 31, 2022, compared to $4.8 million at the end of 2021[11] - Cash and cash equivalents increased to $9.803 million at the end of Q1 2022, up from $4.835 million at the end of Q1 2021[21] - Total assets grew to $110.934 million as of March 31, 2022, compared to $89.564 million at December 31, 2021[20] - Research tax credit receivable increased to $7.136 million, up from $5.863 million at the end of Q4 2021[20] Business Growth and Strategy - The LTE-M/NB business, particularly the Monarch product family, grew over 125% year-over-year and more than 24% sequentially[3] - Management expects gross margin to remain above 55% in Q2 2022, driven by service and licensing revenue[6] - A new strategic partnership is expected to fully fund the remaining 5G investment in the Taurus platform, with a definitive agreement anticipated by June 30, 2022[4] Risks and Challenges - The company is closely monitoring potential business hurdles, including supply chain disruptions and geopolitical tensions[4]