Edit Symbol List
Enter up to 25 symbols separated by commas or spaces in the text box below. These symbols will be available during your session for use on applicable pages.
Don't know the stock symbol? Use the symbol lookup tool.
Alphabetize the sort order of my symbols
Investing just got easier…
Sign up now to become a NASDAQ.com member and begin receiving instant notifications when key events occur that affect the stocks you follow.Access Now X
Sierra Wireless (SWIR)
Q3 2012 Earnings Call
November 1, 2012 5:30 p.m. ET
Dave McClennan – CFO
Jason Cohenour – President and CEO
Richard Tse – Cormark Securities
Matt Ramsay – Canaccord Genuity
Paul Treiber - RBC Capital Markets
Peter Misek - Jefferies
Todd Coupland – CIBC World Markets
Previous Statements by SWIR
» Sierra Wireless' CEO Discusses Q2 2012 Results - Earnings Call Transcript
» Sierra Wireless CEO Discusses Q3 2010 Results - Earnings Call Transcript
» Sierra Wireless, Inc. Q2 2010 Earnings Call Transcript
» Sierra Wireless, Inc. Q1 2010 Earnings Call Transcript
I would now like to introduce you to your host for today’s call, Mr. Jason Cohenour, Sierra Wireless Chief Executive Officer, and Mr. Dave McClennan, Sierra Wireless Chief Financial Officer. Please go ahead, gentlemen.
Thanks, operator. Good afternoon, everyone. It’s Dave McClennan speaking. Thank you for joining today's conference call and webcast. With me today on the call is Jason Cohenour, the company's president and CEO.
As a reminder, today's presentation is being webcast and will be available on our website following the call. Today's agenda is as follows. Jason will provide a general business overview, I will then cover second quarter 2012 financial performance in detail as well as guidance for the fourth quarter of 2012, and then Jason will return for some brief summary comments and Q&A.
Before I get started, I will reference the company's Safe Harbor Statement. A summary of our Safe Harbor Statement can be found on page 2 of the webcast and is now being displayed.
Today's presentation contains certain statements and information that are not based on historical facts and constitute forward-looking statements. These statements include our financial guidance summary for the fourth quarter of 2012 and commentary on our outlook and business drivers.
Our forward-looking statements are based on a number of material assumptions, including those listed on page 2 of the webcast presentation, which could prove to be significantly incorrect and our forward-looking statements are subject to substantial known and unknown material risks and uncertainties.
I draw your attention to a longer discussion of our risk factors in our annual information form and management's discussion and analysis, both of which may be found on SEDAR and EDGAR as well as our other regulatory filings.
This presentation webcast should also be viewed in conjunction with our press release and with the supplementary information on our website, which provides a complete reconciliation of our GAAP and non-GAAP results.
I will now turn the call over to Jason for the business overview.
Thank you Dave, and good afternoon everyone. Overall, I’m pleased to report that Q3 was a very solid quarter for Sierra Wireless. Our revenue grew by nearly 11% on a year over year basis to $162.6 million, and profitability was significantly above expectations.
Non-GAAP earnings from operations were $8.3 million, and non-GAAP EPS was $0.28, well above our guidance range of $0.14 to $0.19 a share.
Underpinning our results was exceptional performance in our M2M business. Q2 M2M revenue was $86.1 million, representing another record quarter. We continue to experience good growth in the Americas and Asia, while Europe remained stable, but lower than historical levels, due to unfavorable macroeconomic conditions in the regions.
We also completed our acquisition of Sagemcom M2M on August 1, further bolstering our leadership position and adding $4.6 million of revenue to our consolidated results.
Our mobile computing business provided a solid contribution in the quarter as well. Revenue was up 7% on a year over year basis to $76.5 million, driven by solid 4G AirCard sales and continued strong growth in PC OEM.
Before discussing the business lines in more detail, I’ll take a moment to revisit our overall strategy, to be a global leader in wireless solutions for both machine-to-machine and mobile computing, two important growth opportunities in the wireless industry.
In M2M, we’re the clear global leader. We’re focused on building on our leadership position, organically and through acquisitions such as Sagemcom, while also investing to expand our role in the M2M value chain.
Longer term, our goal is to continue expanding our offering across the M2M value chain, and to become the M2M platform of choice for OEMs, integrators, and operators around the world, providing intelligent hardware, cloud services, and powerful tools to make it easier, faster, and less costly to build and deploy M2M applications.
In mobile computing, we’re focused on growing with our key operator and PC OEM customers and on being their go-to technology partner, providing the best, most reliable products that support the latest air interface protocols and operating systems. This role places us on the leading edge of new 4G technologies and other important ecosystem innovations such as Windows 8 and Ultrabooks.
We’re also focused on maximizing leverage across the business lines, taking advantage of common, leading edge technology platforms, our broad global footprint, and combined supply chain scale. And this leverage really works. For example, we’ve leveraged our 4G success in mobile computing to create market-leading 4G module and gateway products for M2M as well.
This 4G platform leverage has helped us to earn important M2M wins in networking, automotive, and public safety, and we believe this leverage makes us unique in the market, and provides important competitive advantages for both business lines.
Looking at machine-to-machine in more detail, in the third quarter we delivered another record quarter in our core M2M business. We experienced broad-based demand across the business, with exceptionally strong results in some key M2M segments including networking, where we and our customers are benefitting from a growing trend with network operators to use LTE for fixed line replacement; and automotive, as key customers started to ramp production of new connected car solutions for the U.S. and European markets; in field service, where our industrial handheld customers participated in large enterprise rollouts; and in payment, where the addition of Sagemcom increases considerably our share position with payment terminal OEMs.