Sequans Communications (NYSE:SQNS) Q4 2025 Earnings call February 10, 2026 08:00 AM ET Company ParticipantsDavid Hanover - EVPDeborah Choate - CFOGeorges Karam - CEO and ChairmanConference Call ParticipantsFedor Shabalin - Research AnalystJacob Stephan - Senior Research AnalystMike Grondahl - Head of Equities & Director of Research and Senior Research AnalystScott Searle - Managing Director and Senior Research AnalystOperatorWelcome to the Fourth Quarter and Full-Year Sequans Earnings Conference Call for 20 ...

Financial Data and Key Metrics Changes - In Q4 2025, revenues increased by 72.6% sequentially, primarily driven by growth in product revenue [17] - Gross margin for the quarter was 37.7%, impacted by provisions for slow-moving inventory; excluding these provisions, gross margin would have been approximately 43% compared to 42.4% in the prior quarter [17] - The company reported an IFRS net loss of $87.1 million in Q4, compared to a net profit of $900,000 in the prior quarter; on a non-IFRS basis, the net loss was $18.5 million, or $1.19 per ADS [19] Business Line Data and Key Metrics Changes - The IoT semiconductor business generated $7 million in revenue in Q4, with over 94% from product sales and roughly 6% from services [9] - For the full year 2025, total revenue was approximately $27.2 million, with a significant amount from non-recurring Qualcomm-related revenue [9] - The company expects total global revenue to target approximately $40 million-$45 million in 2026, supported by a strong order backlog [9] Market Data and Key Metrics Changes - The design win pipeline exceeded $550 million in potential three-year product revenue, with over $300 million from design win projects; 44% of these projects have reached production [10] - The company anticipates meaningful revenue from its 5G licensee partner in China, with demand for 5G eRedCap strengthening [12] Company Strategy and Development Direction - The company remains focused on executing its IoT strategy and advancing its 5G product roadmap, aiming to unlock the full strategic value of the IoT business [5] - A disciplined approach to capital management includes right-sizing operating expenses and investing in key R&D programs [7] - The board is actively reviewing strategic alternatives to add profitability and unlock additional value across both the IoT business and the treasury strategy [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the IoT business's momentum, with expectations of reaching cash flow breakeven by Q4 2026 [15] - The company is addressing supply chain challenges, including substrate constraints and memory pricing pressures, while maintaining strong customer relationships [13] - Management highlighted the importance of transitioning from 4G to 5G for IoT applications, viewing the 5G eRedCap solution as critical for future growth [12] Other Important Information - The company repurchased approximately 9.7% of its outstanding ADSs in Q4 and has board authorization for an additional 10% buyback [6] - A non-cash impairment charge of $56.9 million related to Bitcoin holdings was recorded in Q4, alongside an $8.4 million net realized loss on the sale of Bitcoin [18] Q&A Session Summary Question: Guidance on licensing and design wins - Management indicated a conservative approach to licensing revenue, expecting around $5 million secured for the year, with 80%-85% of revenue from products and 15%-20% from services [24][26] Question: Break-even cash goal and operating expenses - Management targets a combined R&D and SG&A expense of around $10.5 million in the second half of the year, aiming for cash flow breakeven [43] Question: Competitive landscape for Cat-1bis and eRedCap - Management noted strong positioning in the Cat-1bis market, with limited competition, and emphasized the importance of eRedCap for future growth [36][38] Question: Impact of memory pricing and supply chain - Management acknowledged challenges in memory pricing and supply chain dynamics, indicating ongoing efforts to manage costs and secure supply [33][34] Question: Bitcoin treasury strategy and debt management - Management is evaluating options regarding convertible debt redemption based on Bitcoin price movements, indicating a preference for early redemption if Bitcoin does not rally [61]

Company Overview - Khaveen Investments is a global investment advisory firm serving high-net-worth individuals, corporations, associations, and institutions [1] - The firm is a registered investment adviser with the Securities Exchange Commission (SEC) [1] - It offers comprehensive services including market and security research, business valuation, and wealth management [1] Investment Strategy - The flagship Macroquantamental Hedge Fund maintains a diversified portfolio with exposure to hundreds of investments across various asset classes, geographies, sectors, and industries [1] - The investment approach integrates top-down and bottom-up analysis, blending three core strategies: global macro, fundamental, and quantitative [1] Core Expertise - The firm specializes in disruptive technologies that are reshaping modern industries [1] - Key focus areas include Artificial Intelligence, Cloud Computing, 5G, Autonomous and Electric Vehicles, FinTech, Augmented and Virtual Reality, and the Internet of Things (IoT) [1]

Core Viewpoint - The company, Guangzhou Huizhi Microelectronics Co., Ltd., specializes in the research, design, and sales of RF front-end chips and modules, with a significant focus on 5G technology and a strong market position as a "specialized, refined, distinctive, and innovative" enterprise [2][8]. Group 1: Company Overview - The main business of the company includes the development, design, and sales of RF front-end chips and modules, with key products in the 5G and 4G frequency bands [2][8]. - The company was established on November 11, 2011, and went public on May 16, 2023 [8]. - As of September 30, the company had 17,700 shareholders, an increase of 9.39% from the previous period [8]. Group 2: Financial Performance - For the period from January to September 2025, the company achieved a revenue of 568 million yuan, representing a year-on-year growth of 48.04% [8]. - The net profit attributable to the parent company was -122 million yuan, showing a year-on-year increase of 58.98% [8]. - The company's overseas revenue accounted for 98.18%, benefiting from the depreciation of the RMB [4]. Group 3: Market Position and Recognition - The company has been recognized as a "specialized, refined, distinctive, and innovative" small giant enterprise, which is a prestigious title in China for small and medium-sized enterprises [2]. - The National Integrated Circuit Industry Investment Fund holds 26.03 million shares, accounting for 5.75% of the total share capital [3]. Group 4: Technical Analysis - The average trading cost of the stock is 11.74 yuan, with recent chip reduction slowing down [7]. - The current stock price is near a resistance level of 12.21 yuan, indicating potential for a price correction if this level is not surpassed [7].

Core Insights - The demand for AI computing power is driving growth in the electronics and semiconductor industries, particularly in the PCB sector, which is expected to recover and expand revenue by 2025 after a downturn [1] - The development of 5G and AI is creating new requirements for PCB materials, with high-frequency, high-speed copper-clad laminates and low-roughness electronic copper foil becoming essential for high-end AI servers [1] - The storage chip market is experiencing explosive growth due to AI demand, with significant increases in contract prices for DRAM and NAND Flash expected in Q1 2026 [1] - Global tech giants are significantly increasing capital expenditures to meet the surging demand for AI computing power, which will drive infrastructure development in data centers [1] - AI technology is increasingly integrated into core semiconductor manufacturing processes to address challenges in advanced process deviations and yield control [1] Industry Summary - The PCB industry is witnessing a rise in AI-PCB demand, leading to an anticipated revenue growth for PCB manufacturers by 2025 as the industry transitions from recession to recovery [1] - The semiconductor sector is adapting to new material requirements driven by advancements in 5G and AI technologies, emphasizing the need for high-performance components [1] - The storage chip market is under pressure due to AI-related demand, with projections indicating a substantial rise in prices for key memory products in the near future [1] - Increased capital expenditures by major technology firms are indicative of a broader trend towards enhancing data center capabilities to support AI applications [1] - The integration of AI in semiconductor manufacturing processes is aimed at improving production efficiency and product quality [1]

Core Viewpoint - Apple is expected to launch a series of new products in the coming weeks, including the iPhone 17e, upgraded iPad, and a new Mac, which has positively impacted the electronic ETF related to Apple's supply chain [1][10]. Group 1: Market Performance - The electronic ETF (515260), heavily weighted by Apple's supply chain, saw an intraday increase of 1.77%, currently up by 1.18%, recovering the 10-day moving average and aiming for a fourth consecutive daily gain [1][10]. - Notable stock performances include Chipone Technology leading with a 9.60% increase, followed by Haiguang Information at 6.17%, and several other companies in the electronic sector showing gains of over 3% [4][13]. Group 2: Apple Financial Performance - In the first quarter of fiscal year 2026, Apple reported iPhone revenue of $85.27 billion, Mac revenue of $83.9 billion, and iPad revenue of $8.6 billion, with CEO Tim Cook highlighting unprecedented market demand driving record performance across all regions [3][12]. - Analysts from CMB International express optimism regarding Apple's ongoing "iPhone cycle and pricing cycle," particularly with the upcoming iPhone Fold/18 upgrade cycle [3][12]. Group 3: Industry Outlook - Apple is anticipated to gradually introduce new products in 2026, including foldable phones and innovative devices like smart glasses and lightweight headsets, which are expected to boost demand for upstream equipment in Apple's supply chain [3][12]. - The electronic ETF (515260) tracks the electronic 50 index, focusing on key sectors such as semiconductors and consumer electronics, with significant weightings in major tech companies like Apple, Nvidia, and Google [6][15].

Market Overview - The A-share market is experiencing a shift in sentiment as the Spring Festival approaches, with an increasing consensus among investors to "hold stocks over the holiday" [1] - The Shanghai and Shenzhen Stock Exchanges announced a package of measures to optimize refinancing, aiming to support the innovative development of quality listed companies [1][3] Refinancing Measures - The exchanges will enhance refinancing efficiency for quality companies with good governance and information disclosure practices, allowing companies facing share price declines to raise funds through methods like private placements and convertible bonds [1] - New standards for "light asset" and "high R&D investment" recognition have been introduced, with light assets defined as physical assets accounting for no more than 20% of total assets, and high R&D investment requiring an average R&D expenditure of at least 15% of revenue over the last three years [3] Investment Strategies - Multiple brokerages suggest a balanced and defensive investment strategy before the holiday, while focusing on growth sectors and industry trends after the holiday [3] - Historical data indicates a typical pattern of reduced trading volume leading up to the holiday, with a significant increase in trading volume expected after the first trading day post-holiday [3][4] Sector Focus - The technology sector is anticipated to see new growth opportunities post-holiday, driven by advancements in artificial intelligence, 5G, and semiconductors [4] - Specific sectors to watch during the holiday include humanoid robots, AI industry chain, gaming, and film, as well as cyclical sectors supported by strong commodity prices and policy backing [5] Conclusion - The overall sentiment suggests a potential "opening red" phenomenon after the Spring Festival, with increased investor participation expected as wealth stories circulate during the holiday [3]

Group 1 - Lianqi Technology (澜起科技) debuted on the Hong Kong Stock Exchange on February 9, 2023, with a closing price of HKD 175 per share, marking a 63.72% increase on its first day of trading [1] - The company focuses on providing innovative, reliable, and high-efficiency interconnect solutions for cloud computing and AI infrastructure, with IPO proceeds aimed at R&D, commercialization, strategic investments, and general corporate purposes [1] - The strong market response reflects the company's technological barriers and the benefits of its sector, aligning with the demand for computing infrastructure upgrades [1] Group 2 - Tongcheng New Materials (彤程新材) has submitted a listing application to the Hong Kong Stock Exchange, with Cathay Pacific Securities as the exclusive sponsor [2] - The company is a leading comprehensive new materials service provider in China, focusing on advanced chemical products, including electronic materials and biodegradable materials [2] - The listing is expected to enhance R&D investment and global production capacity expansion, leveraging its first-mover advantage in domestic photolithography resin [2] Group 3 - China Nuclear International (中核国际) announced a positive earnings forecast, expecting revenue to reach at least HKD 2.46 billion and gross profit to increase to at least HKD 260 million in 2025 [3] - This represents a significant increase from the 2024 expected revenue of approximately HKD 1.841 billion and gross profit of HKD 234 million, driven by increased uranium trading volumes [3] - The company's growth is supported by its unique position within the China National Nuclear Corporation and the rigid demand from domestic nuclear power expansion [3] Group 4 - Hong Kong Telecommunications (香港电讯) reported a 5% year-on-year increase in total revenue for 2025, reaching HKD 36.553 billion [4] - EBITDA grew by 4% to HKD 14.234 billion, while profit attributable to shareholders increased by 4% to HKD 5.286 billion [4] - The steady growth is attributed to robust performance in 5G and data services, reinforcing its position as a leading utility provider in Hong Kong [4] Group 5 - The Hang Seng Index closed at 27,027.16, up 1.76% on February 9, 2023 [5] - The Hang Seng Tech Index rose by 1.34% to 5,417.60, while the Hang Seng Composite Index increased by 1.52% to 9,168.33 [5]

2025 Annual Results For the year ended 31 December 2025 9 February 2026 Hong Kong Forward Looking Statement This presentation may contain "forward-looking statements" that are not historical in nature. These forward-looking statements, which include, without limitation, statements regarding HKT's future results of operations, financial condition or business prospects, are based on the current beliefs, assumptions, expectations, estimates, and projections of the directors and management of HKT about the busi ...

Core Viewpoint - Hong Kong Telecommunications-SS (06823) reported a 5% year-on-year increase in total revenue for 2025, reaching HKD 36.553 billion, with a 4% increase in profit attributable to shareholders at HKD 5.286 billion [1] Revenue Breakdown - Local data service revenue grew by 6% to HKD 14.31 billion, contributing to a 3% increase in local telecommunications service revenue, which reached HKD 17.785 billion [1] - Local data services accounted for 80% of local telecommunications service revenue, making it the largest component [1] - Pay TV services generated revenue of HKD 2.264 billion, while local telephone services brought in HKD 1.8 billion [1] - International telecommunications service revenue also increased by 3% to HKD 7.343 billion, leading to a total telecommunications service revenue increase of 3% to HKD 25.128 billion [1] Mobile Communications Growth - Mobile communications business continued to grow, with service revenue increasing by 5% to HKD 9.157 billion, driven by the growth of roaming services, expansion of the 5G postpaid customer base, and rising demand for mobile communications enterprise solutions [1]