Airgain(US:AIRG)2024-05-09 01:44Financial Data and Key Metrics Changes - Airgain reported Q1 2024 sales of $14.2 million, a 41% increase sequentially but a 13.5% decrease year-over-year [4][12] - Gross margin for Q1 was 40.2%, up 990 basis points sequentially and 120 basis points year-over-year [13] - Operating expenses for Q1 totaled $6.6 million, relatively flat sequentially and down $0.7 million year-over-year [13] Business Line Data and Key Metrics Changes - Enterprise market sales reached $8.9 million, a sequential increase of 92%, driven by custom products, embedded modems, and IoT antennas [12] - Consumer market sales were $3.5 million, reflecting a slight sequential increase, primarily due to a Tier 1 MNO antenna design win [12] - Automotive market sales decreased to $1.8 million, a sequential decline due to ongoing inventory corrections [12] Market Data and Key Metrics Changes - The enterprise market showed strong growth indicators, particularly in custom products and embedded modems, with a good pipeline for IoT antennas [6][12] - The consumer market is expected to see a transition from Wi-Fi 6/6E to Wi-Fi 7, with anticipated growth in the second half of the year [7][12] - The automotive market continues to face headwinds, but interest in products like the Airgain Connect Fleet is increasing [8][12] Company Strategy and Development Direction - The company is transitioning from a component manufacturer to a wireless system solutions provider, focusing on integrated wireless solutions and asset tracking [9][10] - Growth strategy includes executing established business lines while expanding into new wireless connectivity product lines, particularly in asset tracking and 5G connectivity [10][11] - The company aims to leverage emerging trends such as the shift to Wi-Fi 7 and increased demand for asset tracking capabilities [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about market potential and industry recovery, noting progress in product development and partnerships [15][16] - The company anticipates continued growth opportunities in the second half of 2024, despite facing significant headwinds [15][16] - Management highlighted the importance of ongoing investments in R&D and sales efforts to drive long-term growth [5][15] Other Important Information - The company expects Q2 2024 sales to range from $14.25 million to $15.75 million, with a projected sequential growth of approximately 5% [14] - Non-GAAP EPS for Q2 is expected to be negative $0.06, with adjusted EBITDA projected at negative $0.5 million [14] Q&A Session Summary Question: Confirmation on Fleet product trials and revenue expectations - Management confirmed over 20 customer trials for the Fleet product, with shipping expected in early Q3 [18][19] Question: Future EBITDA expectations - Management indicated a desire to reach breakeven EBITDA in Q3 or potentially in Q4 [22][23] Question: Wi-Fi 7 revenue expectations - Management expects material revenue contribution from Wi-Fi 7 in the second half of the year, particularly from a major Tier 1 MSO [24][25] Question: Airgain Connect product expectations - Management outlined a strategy targeting VARs, direct accounts, and strategic partners for the Airgain Connect product, expecting material revenue in the second half [26][27] Question: Certification and deployment timelines for Lantern - Management noted that certification timelines vary, with most trials occurring in North America and some internationally [29][30] Question: 5G repeater trials and carrier partnerships - Management confirmed two active trials, one international and one domestic, with plans for additional trials in the second half of the year [32][33]