• Total Revenue: $61.9 million, a 27% increase year over year.

• Adjusted EBITDA: $9.3 million, significantly ahead of expectations.

• Gross Margin: Approximately 38%, up from 33% in the same quarter last year.

• Mobile Solutions Revenue Growth: Over 43% year over year.

• Services and Other Revenue Growth: 33% year over year.

• Debt Reduction: Reduced to $62 million, with a plan to further reduce to approximately $25 million.

• Operating Expenses: Non-GAAP operating expenses at 28% of revenue, improved from 34% in Q3 2023.

• Telematics Business Sale: Agreement to sell for $52 million, expected to close this quarter.

• Q4 2024 Revenue Guidance: $43 million to $47 million, 25% growth year over year at the midpoint.

• Q4 2024 Adjusted EBITDA Guidance: $3 million to $4 million, over 50% growth year over year at the midpoint.

• Warning! GuruFocus has detected 10 Warning Signs with INSG.

Release Date: November 12, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Inseego Corp (NASDAQ:INSG) reported a 27% year-over-year revenue growth for Q3 2024, surpassing their guidance.

• The company successfully restructured its debt, reducing it from over $160 million to a manageable $41 million in long-term senior debt.

• Inseego Corp (NASDAQ:INSG) divested a non-core international Telematics asset for $52 million, enhancing liquidity and allowing focus on the US 5G wireless connectivity business.

• The company achieved a record high adjusted EBITDA margin of 15% for the quarter, driven by strong revenue performance and cost management.

• Inseego Corp (NASDAQ:INSG) continues to invest in a strong product roadmap, aiming to diversify its revenue base and expand its business with major US carriers.

Negative Points

• Fixed Wireless Access (FWA) revenue declined in Q3 due to lower consumer-based purchases by a carrier customer undergoing acquisition.

• The company faces a tough sequential comparison for Q4 2024 due to record revenue and adjusted EBITDA in Q3 and typical seasonal declines in carrier purchasing.

• Gross margin percentage decreased sequentially in Q3 2024 due to the lower margin contribution from the mobile hotspot business.

• Inseego Corp (NASDAQ:INSG) is still working on improving the monetization of its software products, indicating room for growth in this area.

• The company is experiencing some pressure from customer inventory management and acquisition-related purchasing conservatism, which could impact future sales.

Q & A Highlights

Q: Can you clarify if the $52 million from the Telematic sale is included in the net debt commentary? A: Steven Gatoff, CFO: The net debt numbers going forward include paying down the $15 million stub, but as of now, the debt amounts do not include the application of cash from the Telematic sale.