Sequans Communications Announces First Quarter 2023 Financial Results

Sequans Communications S.A. (NYSE: SQNS), a leading developer and provider of 5G/4G solutions for IoT devices, today announced financial results for the first quarter ended March 31, 2023.

The first quarter revenue was in line with our guidance, which reflected the impact of delayed project launches and customers’ inventory rationalization that we discussed last quarter, ” said Georges Karam, CEO of Sequans. “We anticipate a clear step up in revenue from the first half to the second half of 2023, primarily driven by the expected transition of some of our design wins into full production. We are especially encouraged by seeing a couple of projects reaching this phase already in Q1. Additionally, we continue gaining traction in our design win pipeline, with new design wins for both Monarch 2 and Calliope 2, bringing the potential total 3-year life revenue pipeline above $750 million.”

Mr. Karam concluded, “Additionally, we are making strides toward sampling our 5G Taurus chipset later this year while actively engaging with customers on this platform. These efforts are also aiding our progress in our 5G IP licensing discussions, and we remain optimistic that we can finalize an agreement before the end of the year. Furthermore,  the recent achievement of a $20 million private placement in April has strengthened the company’s position in our ongoing discussions engaged by the Board strategic committee. We remain committed to delivering value to our shareholders and customers and are excited about the opportunities ahead.”

Q2 2023 Outlook

The following statement is based on management’s current assumptions and expectations. This statement is forward-looking and actual results may differ materially.

As a result of our primary 5G IP agreement’s payment structure, licensing revenue is expected to normalize to a lower quarterly level beginning in Q2. As product shipments are not expected to accelerate before Q3, management expects revenue to be in the range of $9 million to $11 million, with gross margin expected to be around 65% for the quarter ending June 30, 2023.