Inseego Reports Fourth Quarter and Full Year 2024 Financial Results

Q4 2024 revenue of $48.1 millionQ4 2024 positive Adjusted EBITDA of $5.4 million and GAAP Operating Income of $1.8 millionCompleted sale of telematics business for $52.7 million in cashCompleted convertible debt restructurings with material reductions in debt SAN DIEGO, Feb. 19, 2025 (GLOBE NEWSWIRE) -- Inseego Corp. (Nasdaq: INSG) (the “Company”), a technology leader in 5G mobile and fixed wireless solutions for mobile network operators, Fortune 500 enterprises and SMBs, today reported its results for the fourth quarter and full year ended December 31, 2024. “My first weeks at Inseego have been very positive, and we are already making progress towards positioning the company as the wireless broadband partner of choice within the wireless ecosystem,” stated Juho Sarvikas, Chief Executive Officer of Inseego. “Our fourth-quarter operational performance delivered encouraging results, reflecting strength in both revenue and Adjusted EBITDA. While we see some near-term headwinds in the first quarter, I am confident that we are on track to deliver year-on-year growth in 2025 as we focus on expanding both our solution portfolio and customer base. Together, as a team, we remain committed to driving long-term growth to create stockholder value." “We continue to be focused on driving stockholder value and were pleased to close both the restructuring of our outstanding convertible notes and the sale of our Telematics business, receiving $52 million in cash in the quarter,” Steven Gatoff, Chief Financial Officer of Inseego, commented. "These transactions right-sized the Company’s capital structure and provided meaningful additional liquidity and flexibility as we move forward to develop new products and drive growth.” Financial Highlights Revenue for Q4 2024 was $48.1 million; full year 2024 revenue was $191.2 million.Adjusted EBITDA for Q4 2024 was $5.4 million; full year 2024 Adjusted EBITDA was $20.5 million.GAAP gross margin for Q4 2024 was 37.3%; full year 2024 GAAP gross margin was 36.0%. Capital Structure Improvements On November 6, 2024, the Company completed its capital structure management initiative and material debt reduction by exchanging $91.5 million of principal value of the Company’s 3.25% convertible notes due 2025 for long-term debt and equity; the Company has now repurchased or exchanged at a discount approximately $147 million, or 91% of aggregate principal amount, of the $162 million of the convertible notes that were outstanding as of December 31, 2023. See separate press release issued on November 12, 2024 for further details. Business Highlights Completed the sale of the Company’s Telematics business for $52.7 million in cash.Appointed Juho Sarvikas as the new Chief Executive Officer and Board member.Achieved highest quarterly MiFi X PRO sales ever with one major North American carrier who continues to see great success with our device especially with public sector customers.Received award letter from a large service provider for our next generation indoor FWA device.Ranged MiFi X PRO with a global communications solutions provider for business and government agencies. Executed large FWA order with a major Internet Service Provider who uses Inseego devices to deliver ultra-fast, SLA-guaranteed, symmetrical fixed wireless access to businesses. Completed transaction with a global medical device manufacturer to improve patient outcomes by providing reliable wireless connectivity to automatic external defibrillators.Selected in two competitive opportunities to be the hardware supplier to large nonprofit telecom companies that provide affordable broadband services to bridge the digital divide. Q1 2025 Guidance Total revenue in the range of $30.0 million to $33.0 million.Adjusted EBITDA in the range of $2.0 million to $3.0 million. Conference Call Information Inseego will host a conference call and live webcast today at 5:00 p.m. ET. To access the conference call: Online, visit https://investor.inseego.com/events-presentationsThose without internet access may dial in by calling: In the United States, call 1-844-282-4463International parties can access the call at 1-412-317-5613 An audio replay of the conference call will be available one hour after the call through March 5, 2025. To hear the replay, parties in the United States may call 1-877-344-7529 and enter access code 9063175 followed by the # key. International parties may call 1-412-317-0088. In addition, the Inseego Corp. press release will be accessible from the Company's website before the conference call begins. About Inseego Corp. Inseego Corp. (Nasdaq: INSG) is the industry leader in 5G Enterprise cloud WAN solutions, with millions of end customers and thousands of enterprise and SMB customers on its 4G, 5G, and cloud platforms. Inseego’s 5G Edge Cloud combines the industry’s best 5G technology, rich cloud networking features, and intelligent edge applications. Inseego powers new business experiences by connecting distributed sites and workforces, securing enterprise data, and improving business outcomes with intelligent operational visibility---all over a 5G network. For more information on Inseego, visit www.inseego.com #Putting5GtoWork ©2025. Inseego Corp. All rights reserved. MiFi and the Inseego name and logo are registered trademarks of Inseego Corp. Other company, product, or service names mentioned herein are the trademarks of their respective owners. Cautionary Note Regarding Forward-Looking Statements Some of the information presented in this news release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In this context, forward-looking statements often address expected future business and financial performance and often contain words such as “may,” “estimate,” “anticipate,” “believe,” “expect,” “intend,” “plan,” “project,” “will” and similar words and phrases indicating future results. The information presented in this news release related to our future business outlook, the future demand for our products, and other statements that are not purely historical facts are forward-looking. These forward-looking statements are based on management’s current expectations, assumptions, estimates, and projections. They are subject to significant risks and uncertainties that could cause results to differ materially from those anticipated in such forward-looking statements. We, therefore, cannot guarantee future results, performance, or achievements. Actual results could differ materially from our expectations. Factors that could cause actual results to differ materially from the Company’s expectations include: (1) the Company’s dependence on a small number of customers for a substantial portion of our revenues; (2) the future demand for wireless broadband access to data and asset management software and services and our ability to accurately forecast; (3) the growth of wireless wide-area networking and asset management software and services; (4) customer and end-user acceptance of the Company’s current product and service offerings and market demand for the Company’s anticipated new product and service offerings; (5) our ability to develop sales channels and to onboard channel partners; (6) increased competition and pricing pressure from participants in the markets in which the Company is engaged; (7) dependence on third-party manufacturers and key component suppliers worldwide; (8) the impact of fluctuations of foreign currency exchange rates; (9) the impact of supply chain challenges on our ability to source components and manufacture our products; (10) unexpected liabilities or expenses; (11) the Company’s ability to introduce new products and services in a timely manner, including the ability to develop and launch 5G products at the speed and functionality required by our customers; (12) litigation, regulatory and IP developments related to our products or components of our products; (13) the Company’s ability to raise additional financing when the Company requires capital for operations or to satisfy corporate obligations; (14) the Company’s plans and expectations relating to acquisitions, divestitures, strategic relationships, international expansion, software and hardware developments, personnel matters, and cost containment initiatives, including restructuring activities and the timing of their implementations; (15) the global semiconductor shortage and any related price increases or supply chain disruptions, (16) the potential impact of COVID-19 or other global public health emergencies on the business, (17) the impact of high rates of inflation and rising interest rates, (18) the impact of import tariffs on our materials and products, and (19) the impact of geopolitical instability on our business. These factors, as well as other factors set forth as risk factors or otherwise described in the reports filed by the Company with the SEC (available at www.sec.gov), could cause results to differ materially from those expressed in the Company’s forward-looking statements. The Company assumes no obligation to update publicly any forward-looking statements, even if new information becomes available or other events occur in the future, except as otherwise required under applicable law and our ongoing reporting obligations under the Securities Exchange Act of 1934, as amended. Non-GAAP Financial Measures Inseego Corp. has provided financial information in this press release that has not been prepared in accordance with GAAP. Adjusted EBITDA and non-GAAP operating costs and expenses, for example, exclude preferred stock dividends, share-based compensation expense, amortization of intangible assets purchased through acquisitions, amortization of discount and issuance costs related to our 2025 Notes and revolving credit facility, fair value adjustments on derivative instruments, and other non-recurring expenses. Adjusted EBITDA excludes interest, taxes, depreciation, amortization, impairment of capitalized software, impairment of long-lived assets, debt restructuring costs and divestiture related costs, along with certain other non-recurring expenses and foreign exchange gains and losses. Adjusted EBITDA, non-GAAP cost of revenues, and non-GAAP operating costs and expenses are supplemental measures of our performance that are not required by, or presented in accordance with, GAAP. These non-GAAP financial measures have limitations as an analytical tool. They are not intended to be used in isolation or as a substitute for cost of revenues, operating expenses, net loss, net loss per share or any other performance measure determined in accordance with GAAP. We present these non-GAAP financial measures because we consider them to be an important supplemental performance measure. We use these non-GAAP financial measures to make operational decisions, evaluate our performance, prepare forecasts and determine compensation. Further, management and investors benefit from referring to these non-GAAP financial measures in assessing our performance when planning, forecasting and analyzing future periods. Share-based compensation expenses are expected to vary depending on the number of new incentive award grants issued to both current and new employees, the number of such grants forfeited by former employees, and changes in our stock price, stock market volatility, expected option term and risk-free interest rates, all of which are difficult to estimate. In calculating non-GAAP financial measures, we exclude certain non-cash and one-time items to facilitate comparability of our operating performance on a period-to-period basis because such expenses are not, in our view, related to our ongoing operational performance. We use this view of our operating performance to compare it with the business plan and individual operating budgets and in the allocation of resources. We believe that these non-GAAP financial measures are helpful to investors in providing greater transparency to the information used by management in its operational decision-making. The Company believes that using these non-GAAP financial measures also facilitates comparing our underlying operating performance with other companies in our industry, which use similar non-GAAP financial measures to supplement their GAAP results. In the future, we expect to continue to incur expenses similar to the non-GAAP adjustments described above, and the exclusion of these items in the presentation of our non-GAAP financial measures should not be construed as an inference that these costs are unusual, infrequent, or non-recurring. Investors and potential investors are cautioned that material limitations are associated with using non-GAAP financial measures as an analytical tool. The limitations of relying on non-GAAP financial measures include, but are not limited to, the fact that other companies, including other companies in our industry, may calculate non-GAAP financial measures differently than we do, limiting their usefulness as a comparative tool. Investors and potential investors are encouraged to review the reconciliation of our non-GAAP financial measures in this press release with our GAAP financial results. Investor Relations Contact: Matt Glover, Gateway Group: (949) 574-3860IR@inseego.com INSEEGO CORP.CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share data) (Unaudited) Three Months EndedDecember 31, Year EndedDecember 31, 2024 2023 2024 2023 Revenues: Mobile solutions$25,499 $16,029 $98,930 $80,498 Fixed wireless access solutions 10,427 12,411 47,649 54,900 Product 35,926 28,440 146,579 135,398 Services and other 12,161 7,479 44,665 31,888 Total revenues 48,087 35,919 191,244 167,286 Cost of revenues: Product 28,578 25,782 115,390 127,157 Services and other 1,565 794 7,057 4,353 Total cost of revenues 30,143 26,576 122,447 131,510 Gross profit (loss) 17,944 9,343 68,797 35,776 Operating costs and expenses: Research and development 5,564 5,356 20,596 19,725 Sales and marketing 3,775 2,929 15,951 16,632 General and administrative 4,545 3,527 17,240 15,853 Depreciation and amortization 2,270 5,283 12,368 18,408 Impairment of capitalized software — — 927 1,115 Total operating costs and expenses 16,154 17,095 67,082 71,733 Operating income (loss) 1,790 (7,752) 1,715 (35,957)Other (expense) income: (Loss)/Gain on debt restructurings, net (16,541) — (2,851) — Loss on extinguishment of revolving credit facility — — (788) — Interest expense, net (1,220) (2,176) (10,906) (9,086)Other income (expense), net 14 19 (850) 70 Income (Loss) before income taxes (15,957) (9,909) (13,680) (44,973)Income tax provision 518 (1) 689 43 Income (Loss) from continuing operations (16,475) (9,908) (14,369) (45,016)Income from discontinued operations, net of income tax provision 15,909 (4,432) 18,941 (1,169)Net income (loss) (566) (14,340) 4,572 (46,185)Preferred stock dividends (844) (773) (3,269) (2,991)Net income (loss) attributable to common stockholders$(1,410) $(15,113) $1,303 $(49,176)Per share data: Net earnings (loss) per share: Basic and diluted: Continuing operations$(1.23) $(0.90) $(1.41) $(4.22)Discontinued operations$1.13 $(0.38) $1.51 $(0.10)Basic earnings (loss) per share (*)$(0.10) $(1.28) $0.10 $(4.32)Weighted-average shares used in computation of net earnings (loss) per share Basic and diluted (*) 14,032,056 11,809,306 12,535,756 11,372,069 (*) Adjusted retroactively for reverse stock split that occurred on January 24, 2024 INSEEGO CORP.CONSOLIDATED BALANCE SHEETS(In thousands)(Unaudited) December 31,2024 December 31,2023ASSETS Current assets: Cash and cash equivalents$39,596 $2,409 Accounts receivable, net 13,803 18,202 Inventories 13,575 20,555 Prepaid expenses and other 5,926 4,937 Current assets held for sale — 12,123 Total current assets 72,900 58,226 Property, plant and equipment, net 1,102 2,389 Intangible assets, net 18,747 25,718 Goodwill 3,949 3,949 Operating lease right-of-use assets 2,855 4,022 Other assets 446 1,256 Non-current assets held for sale — 26,237 Total assets$99,999 $121,797 LIABILITIES AND STOCKHOLDERS’ DEFICIT Current liabilities: Accounts payable$18,433 $23,408 Accrued expenses and other current liabilities 30,133 21,049 2025 Convertible Notes, net 14,905 — Revolving credit facility, net — 4,094 Current liabilities held for sale — 7,360 Total current liabilities 63,471 55,911 Long-term liabilities: 2025 Convertible Notes, net — 159,912 Operating lease liabilities 2,627 3,972 Deferred tax liabilities, net 174 112 2029 Senior Secured Notes, net 41,830 — Other long-term liabilities 4,755 2,351 Non-current liabilities held for sale — 1,644 Total liabilities 112,857 223,902 Commitments and contingencies Stockholders’ deficit: Preferred stock (aggregate liquidation preference of $38.4 million) — — Common stock 15 12 Additional paid-in capital 892,534 810,138 Accumulated other comprehensive loss 218 (5,327)Accumulated deficit (905,625) (906,928)Total stockholders’ deficit (12,858) (102,105) Total liabilities and stockholders’ deficit$99,999 $121,797 INSEEGO CORP.CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands)(Unaudited) Year Ended December 31, 2024 2023 Cash flows from operating activities: Net income (loss)$4,572 $(46,185)Adjustments to reconcile Net income (loss) to net cash provided by operating activities (Income) Loss from discontinued operations, net of tax (18,941) 1,169 Depreciation and amortization 12,529 18,709 Provision for expected credit losses 216 302 Impairment of capitalized software 927 1,115 Provision for excess and obsolete inventory (54) 9,491 Write-off of capitalized inventory order fees — 1,275 Impairment of operating lease right-of-use assets 138 469 Share-based compensation expense 3,824 6,971 Amortization of debt discount and debt issuance costs 4,399 1,953 Loss on extinguishment of revolving credit facility 788 — Loss on debt restructurings, net 2,851 — Deferred income taxes 62 9 Non-cash operating lease expense 1,035 1,038 Changes in assets and liabilities, net of effects of divestiture: Accounts receivable 4,670 3,068 Inventories 6,923 4,272 Prepaid expenses and other assets (71) 1,933 Accounts payable (6,947) (802)Accrued expenses other liabilities 10,966 235 Operating lease liabilities (1,230) (1,272)Operating cash flows from continuing operations 26,657 3,750 Operating cash flows from discontinued operations 6,862 2,207 Net cash provided by operating activities 33,519 5,957 Cash flows from investing activities: Purchases of property, plant and equipment (100) (224)Additions to capitalized software development costs and purchases of intangible assets (4,961) (8,112)Investing cash flows from continuing operations (5,061) (8,336)Investing cash flows from discontinued operations 48,092 (1,833) Net cash provided by (used in) investing activities 43,031 (10,169)Cash flows from financing activities: Payments related to repurchases of 2025 Convertible Notes (33,769) — Proceeds from issuance of short-term loan and warrants, net of issuance costs 19,350 — Repayments on short-term loan (19,500) — Net repayments on asset-backed revolving credit facility (4,882) (3,757)Net repayment of bank and overdraft facilities — (186)Proceeds from a public offering, net of issuance costs — 6,057 Proceeds from stock option exercises and ESPP 20 97 Financing cash flows from continuing operations (38,781) 2,211 Financing cash flows from discontinued operations — — Net cash provided by (used in) financing activities (38,781) 2,211 Effect of exchange rates on cash (582) 1,169 Net increase (decrease) in cash, cash equivalents and restricted cash 37,187 (832)Cash, cash equivalents and restricted cash, beginning of period 2,409 3,241 Cash, cash equivalents and restricted cash, end of period$39,596 $2,409 INSEEGO CORP.Supplemental 2024 Statement of Operations Data by Quarter (In thousands)(Unaudited) Year Ended Three Months Ended December 31,2024 December 31,2024 September 30,2024 June 30,2024 March 31,2024Revenues: Mobile solutions$98,930 $25,499 $32,282 $25,879 $15,270 Fixed wireless access solutions 47,649 10,427 9,723 13,317 14,182 Product 146,579 35,926 42,005 39,196 29,452 Services and other 44,665 12,161 12,027 12,424 8,053 Total revenues 191,244 48,087 54,032 51,620 37,505 Cost of revenues: Product 115,390 28,578 33,592 30,507 22,713 Services and other 7,057 1,565 1,640 2,304 1,548 Total cost of revenues 122,447 30,143 35,232 32,811 24,261 Gross profit (loss) 68,797 17,944 18,800 18,809 13,244 Operating costs and expenses: Research and development 20,596 5,564 5,176 5,173 4,683 Sales and marketing 15,951 3,775 4,125 4,212 3,839 General and administrative 17,240 4,545 4,822 3,918 3,955 Depreciation and amortization 12,368 2,270 3,154 3,652 3,292 Impairment of capitalized software 927 — 507 — 420 Total operating costs and expenses 67,082 16,154 17,784 16,955 16,189 Operating income (loss) 1,715 1,790 1,016 1,854 (2,945)Other (expense) income: (Loss)/Gain on debt restructurings, net (2,851) (16,541) 12,366 1,324 — Loss on extinguishment of revolving credit facility (788) — — (788) — Interest expense, net (10,906) (1,220) (5,731) (1,776) (2,179)Other income (expense), net (850) 14 (72) (417) (375)Income (Loss) before income taxes (13,680) (15,957) 7,579 197 (5,499)Income tax provision 689 518 36 118 17 Income (Loss) from continuing operations (14,369) (16,475) 7,543 79 (5,516)Income from discontinued operations, net of income tax provision 18,941 15,909 1,426 545 1,061 Net income (loss) 4,572 (566) 8,969 624 (4,455)Preferred stock dividends (3,269) (844) (827) (808) (790)Net income (loss) attributable to common stockholders$1,303 $(1,410) $8,142 $(184) $(5,245) INSEEGO CORP.Supplemental 2023 Statement of Operations Data by Quarter (In thousands)(Unaudited) Year Ended Three Months Ended December 31,2023 December 31,2023 September 30,2023 June 30,2023 March 31,2023Revenues: Mobile solutions$80,498 $16,029 $22,534 $18,895 $23,040 Fixed wireless access solutions 54,900 12,411 11,114 19,505 11,870 Product 135,398 28,440 33,648 38,400 34,910 Services and other 31,888 7,479 7,709 7,983 8,717 Total revenues 167,286 35,919 41,357 46,383 43,627 Cost of revenues: Product 127,157 25,782 42,788 30,620 27,967 Services and other 4,353 794 734 1,139 1,686 Total cost of revenues 131,510 26,576 43,522 31,759 29,653 Gross profit (loss) 35,776 9,343 (2,165) 14,624 13,974 Operating costs and expenses: Research and development 19,725 5,356 5,200 5,822 3,347 Sales and marketing 16,632 2,929 3,893 4,575 5,235 General and administrative 15,853 3,527 3,429 4,281 4,616 Depreciation and amortization 18,408 5,283 3,848 4,327 4,950 Impairment of capitalized software 1,115 — 611 — 504 Total operating costs and expenses 71,733 17,095 16,981 19,005 18,652 Operating income (loss) (35,957) (7,752) (19,146) (4,381) (4,678)Other (expense) income: Interest expense, net (9,086) (2,176) (2,894) (2,017) (1,999)Other income (expense), net 70 19 45 23 (17)Income (Loss) before income taxes (44,973) (9,909) (21,995) (6,375) (6,694)Income tax provision 43 (1) 30 15 (1)Income (Loss) from continuing operations (45,016) (9,908) (22,025) (6,390) (6,693)Income from discontinued operations, net of income tax provision (1,169) (4,432) 220 1,454 1,589 Net income (loss) (46,185) (14,340) (21,805) (4,936) (5,104)Preferred stock dividends (2,991) (773) (756) (739) (723)Net income (loss) attributable to common stockholders$(49,176) $(15,113) $(22,561) $(5,675) $(5,827) INSEEGO CORP.Supplemental 2024 Reconciliation of GAAP Income (Loss) from Continuing Operations to Adjusted EBITDA (In thousands)(Unaudited) Year Ended Three Months Ended December 31,2024 December 31,2024 September 30,2024 June 30,2024 March 31,2024Income (Loss) from continuing operations$(14,369) $(16,475) $7,543 $79 $(5,516)Income tax provision (benefit) 689 518 36 118 17 Interest expense, net 10,906 1,220 5,731 1,776 2,179 Loss on extinguishment of revolving credit facility 788 — — 788 — Loss/(Gain) on debt restructurings, net 2,851 16,541 (12,366) (1,324) — Other (income) expense, net 850 (14) 72 417 375 Depreciation and amortization 12,529 2,308 3,193 3,691 3,337 Share-based compensation expense 3,823 1,109 1,193 834 687 Debt restructuring costs 1,322 201 669 452 — Impairment of operating lease right-of-use assets 139 — 139 — — Impairment of capitalized software 927 — 507 — 420 Adjusted EBITDA from continuing operations 20,455 5,408 6,717 6,831 1,499 See “Non-GAAP Financial Measures” for information regarding our use of Non-GAAP financial measures. INSEEGO CORP.Supplemental 2023 Reconciliation of GAAP Income (Loss) from Continuing Operations to Adjusted EBITDA (In thousands)(Unaudited) Year Ended Three Months Ended December 31,2023 December 31,2023 September 30,2023 June 30,2023 March 31,2023Income (Loss) from continuing operations$(45,016) $(9,908) $(22,025) $(6,390) $(6,693)Income tax provision (benefit) 43 (1) 30 15 (1)Interest expense, net 9,086 2,176 2,894 2,017 1,999 Other (income) expense, net (70) (19) (45) (23) 17 Depreciation and amortization 18,713 5,350 4,421 4,438 4,504 Share-based compensation expense 6,972 1,333 2,123 1,820 1,696 Impairment of operating lease right-of-use assets 469 — — 469 — Inventory adjustments - E&O and contract manufacturer liability ** 16,427 3,370 13,057 — — Write-off of capitalized inventory order fees ** 924 — 924 — — Impairment of capitalized software 1,115 — 611 — 504 Adjusted EBITDA from continuing operations 8,663 2,301 1,990 2,346 2,026 ** These items are not adjusted from the period ending December 31, 2023 going forward See “Non-GAAP Financial Measures” for information regarding our use of Non-GAAP financial measures.

Inseego Reports Fourth Quarter and Full Year 2024 Financial Results

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