PowerFleet Inc. Common Stock (PWFL) Q4 2020 Earnings Call Transcript

PowerFleet Inc. Common Stock (NASDAQ: PWFL)
Q4 2020 Earnings Call
Feb 25, 2021, 8:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning. Welcome to PowerFleet's fourth-quarter and full-year 2020 conference call. Joining us for today's presentation is the company's CEO, Chris Wolfe and CFO, Ned Mavrommatis. Following their remarks, we will open the call for questions.

Before we begin the call, I would like to provide PowerFleet's safe harbor statement that includes cautions regarding forward-looking statements made during this call. During the call, there will be forward-looking statements made regarding future events, including PowerFleet's future financial performance. All statements other than present and historical facts, which include any statements regarding the company's plans for future operations, anticipated future financial position, anticipated results of operation, business strategy, competitive position, company's expectations regarding opportunities for growth, demand for the company's product offering and other industry trends are considered forward-looking statements. Such statements include, but are not limited to, the company's financial expectations for 2020 and beyond.

All such forward-looking statements imply the presence of risks, uncertainties, and contingencies, many of which are beyond the company's control. The company's actual results, performance or achievements may differ materially from those projected or assumed in any forward-looking statement. Factors that could cause actual results to differ materially could include, among others, SEC filings, overall economic and business conditions, demand for the company's products and services, competitive factors, emergence of new technologies, and the company's cash position. The company does not intend to undertake any duty to update any forward-looking statements to reflect future events or circumstances.

Finally, I would like to remind everyone that this call will be made available for replay in the Investor Relations section of the company's website at www.powerfleet.com. Now, I would like to turn the call over to PowerFleet's CEO, Mr. Chris Wolfe. Sir, please proceed.

Chris Wolfe -- Chief Executive Officer

Hey. Thank you, Alice. Good morning, everyone, and thank you for joining our call. I hope everyone is staying healthy and doing well during these very unprecedented times.

As you saw from our earnings release the fourth quarter was a solid finish to a very unpredictable and challenging year for companies globally. PowerFleet's focus on driving profitable growth, along with continued execution against our strategic initiatives, enable us to deliver 7% sequential increase in our top-line revenues, a 4% sequential increase in high margin recurring services revenue, and a meaningful improvement to our bottom line. These improving financial metrics demonstrate the leverage of our business model and the ongoing benefits from our cost optimizations tooperate optimization measures, which together helped produce robust gross margins an $8.8 million in operating cash generation for 2020. From a sales perspective, we finished the year strong with several new customer wins and we entered 2021 with a solid backlog of installations and a robust prospect pipeline.

During Q4, more recently, we secured and announced a number of notable wins, including Panhandle Transportation Group, Nucor Tubular, and McGuire Transportation. These wins contributed to our basic monthly subscription units, which totaled a record 590,000 at the end of Q4. Before I dive into our business segments and outlook, I'll turn the call over to our CFO Ned Mavrommatis to discuss our results for the fourth-quarter and full-year of 2020. Ned?

Ned Mavrommatis -- Chief Financial Officer

Thank you, Chris, and good morning, everyone. Turning to our results for Q4 and the full year of 2020. Revenue for the fourth quarter of 2020 increased to $29.4 million from $27.6 million in the prior quarter but decreased from $35.1 million in Q4 of last year. The year-over-year decrease in revenue was related to the reduction in product revenue from our last major shipment to Avis in Q4 of 2019 and the impact from COVID-19.

Revenue for the full-year 2020 increased to around $113.6 million from $81.9 million in 2019. High margin, recurring and services revenue for the fourth quarter was $17.3 million or 59% of total revenue. This compares to $16.7 million or 60% of total revenue in the prior quarter and $18.7 million or 53% of total revenue in Q4 of last year. For the full-year 2020, services revenue was $67.9 million or 60% of our total revenue, compared to $36.5 million or 45% of total revenue in 2019.

Product revenue, which drives future service revenue was $12.1 million or 41% of total revenue. This compares to $10.9 million or 40% of total revenue in the prior quarter and $16.5 million or 47% of total revenue in Q4 of last year. For the full year of 2020, product revenue was $45.7 million or 40% of total revenue, compared to $45.4 million or 55% of total revenue in 2019. Gross profit have increased to $15.2 million or 52% of total revenue from $14.9 million or 54% of total revenue in the prior quarter and $16.6 million or 47% of total revenue in Q4 of last year.

For the full-year 2020, gross profit increased to $59 million or 52% of total revenue from $38.4 million or 47% of total revenue in 2019. Now turning to our expenses. Total operating expenses for the fourth quarter of 2020 were $15.3 million, up from $14.2 million in the prior quarter. The $15.3 million in Q4 was up 7% from the prior quarter but was down 23% from Q4 of 2019.

For the full year, operating expenses were also $62.5 million, compared to $48.5 million in 2019. Turning to our profitability measures. GAAP net loss attributable to common stockholders for the fourth quarter of 2019 totaled $3.5 million or $0.12 per basic and diluted share. This compares to a GAAP net loss of $1.7 million or $0.06 per basic and diluted share in the prior quarter and GAAP net loss of $5.2 million or $0.18 per basic and the diluted share in Q4 of last year.

Net loss in the fourth quarter of 2020 included $2 million in noncash expense related to foreign currency translation of debt outstanding in local currency at our company's Israeli subsidiary. For the full-year 2020, GAAP net loss was $13.6 million or $0.46 per basic and diluted share, compared to GAAP net loss of $12 million or $0.59 per basic and diluted share in 2019. Net loss for 2020 includes $2.1 million in noncash expense related to foreign currency translation of debt outstanding in local currency at the company's Israeli subsidiary. Due to this noncash expense as well as additional gains and losses that may not be indicative of our core operating results, we introduced non-GAAP net income to now supplement our GAAP results.

Non-GAAP net income attributable to stockholders for Q4 of 2020 totaled $2 million or $0.07 per basic and $0.05 per diluted share. This was an improvement compared to non-GAAP net loss attributable to common stockholders of $606,000 or $0.02 for basic and diluted share in Q4 of last year. For the full-year 2020, non-GAAP net income attributable to common stock stockholders totaled $3.7 million or $0.12 per basic and the $0.10 per diluted share, which was a significant improvement, compared to non-GAAP net loss attributable to common stockholders of $4.7 million or $0.23 per basic and diluted share in 2019. Adjusted EBITDA for Q4 2020 totaled $3.2 million or 11% of total revenue, compared to adjusted EBITDA of $3.6 million in the prior quarter and adjusted EBITDA of $2.1 million in Q4 of last year.

For the full year of 2020, adjusted EBITDA totaled $9.1 million, compared to adjusted EBITDA of $3.2 million in 2019. Our liquidity position remained strong at quarter end with $18.1 million in cash and cash equivalents and working capital of $28.9 million. On February '21, we closed an underwritten public offering that generated net proceeds of approximately $27 million. And as of today, our cash position exceeds $45 million, giving us ample resources and runway to execute our growth strategy.

I'm encouraged to report that for the full year of 2020 we generated $8.8 million in cash from operations, which is a significant improvement from $7.3 million used in basic operations in the same period in 2019. In summary, we believe our diversified customer base, predictable, high-margin recurring and services revenue and prudent approach to cash management will really help us ensure that we successfully navigate this uncertain times. That concludes my prepared remarks. Chris?

Chris Wolfe -- Chief Executive Officer

Thanks, Ned. Our improving financial performance reflects our global team's continued operational execution and building sales momentum. In our industrial segment, which includes forklifts and material handling equipment, we continue to see improving sales traction across some of our strategic direct sales team on our indirect channels, which include our OEM white label product and our expanding U.S. partner network.

Along that line, our U.S. partner channels, we continue to see increased activity in sales over Q3 levels, including volume unit orders from our new strategic OEM partner, Jungheinrich, the third largest forklift manufacturer in the world. Our partnership with Toyota Motor manufacturing continues to gain traction. During the quarter, they expanded by installing a plant in Mississippi.

And on top of this, working with our partner, Attached Solutions, we also secured a new Toyota plant in Mexico. Also in Q4, we signed and deployed our first e-commerce distribution center for the world's largest brick-and-mortar retailer. We also had several other notable wins and deployments in the period, including Mazda Toyota Motors, Coca-Cola Minute Maid, Daimler and Audi. And in terms of priorities and initiatives in our industrial segment in 2021, after our successful upgrade with Walgreens, we have been aggressively working with our long-standing customers to transition them from our older legacy platforms to our next-generation solutions and to a reoccurring revenue model.

We expect to see several of these major customers commence our transition in the second half of this year. It is worth noting that these major migrations require both the telemetry unit refresh and a migration to our Software as a Service cloud-based platform. This legacy customer base also represents over 30,000 units in high-value product sales potential, and nearly all these customers pay little or no reoccurring SaaS fees today. It was an equally busy quarter in our logistics segment.

And as I mentioned in my opening remarks, we secured a great win with Panhandle Transportation Group, a 525-unit refrigerated fleet will begin shipping our LV-400 reefer telemetry platform also in -- during Q1. We also started delivery of the previously announced 6,000-unit, solar and supercap, LV-500 container telemetry platform, which also included our LV-710 freight camera system. Additionally and not previously announced, a major supermarket chain in the southeast placed an order for about 1,200 trailer and reefer platforms in Q4, and we've already started shipping these units. On the R&D front, PowerFleet has designed a family of products to help our customers with the critical activity of weight sensing to maximize revenue, ensure safety, optimize asset utilization and comply with regulatory requirements.

Our LV-300 WS, WS standing for way sensing, telemetry platform is a single device that not only provides asset telemetry data, but also focuses on weight detection, which provides accurate detection of events such as mounted and dismounted containers on and off chassis. Our LV-750 weight on axle sensor when paired up with the LV-300 WS goes even a step further and focuses on weight measurement to include not only the information on mounted and dismounted containers but also can tell if the container is loaded or not. Given the container bottlenecks were experienced at the port of Los Angeles, these new capabilities are aimed squarely at fixing a major industry pain point. We recently completed a major milestone in our way-sensing initiative with American Intermodal Management.

Our work has led to American Intermodal Management placing an initial order for 1,000 LV-300 WS platforms and matching LV-750 weight on axle sensors, which are currently being installed on new chassis being built in Mexico this quarter. In the first half of 2021, we plan to release two new multimode telemetry platforms, where we recently started field trials for a major customer. These products will really broaden our portfolio, increase our overall market potential. Additionally, we will continue our R&D efforts and push to see if we can achieve legal weight on axle, which, if successful, and at the right price point can be an industry game changer.

Internationally, sales for our Pointer Israel operations exceeded 2019 levels, which is a very impressive feat given the closing of the economy several times in 2020 due to COVID. Israeli vaccinations are nearing 50% of the population, and much of our workforce has had their first vaccination. Pointer Israel has increased its share of the premium car market with wins at Volvo Honda privacy as well as increased market share in the rental car market with wins at Budget, Pery Car Rental and Eldan Car Rental. We also continue in our installations of wireless defibrillators throughout the country with Magen David Adom, M-D-A, MDA.

MDA is the state of Israel's national EMS organization responsible for emergency pre-hospital medical care and blood services. MDA is playing a critical central role in Israel's response to the COVID crisis, including testing, sampling, scheduling and managing vaccinations. In addition to the MDA, our Pointer Israel won a major tender with Maccabi Health. And our temperature and IoT projects are gaining momentum in pharma, food, cannabis, grocery and honey production.

In terms of our other international geographies, our Pointer Argentina operations signed Edenred in Mexico, targeting an initial deployment of 2,000 units starting in Q1 with a possible upside potential of 45,000 units. In -- our Pointer Mexico operation also continued to roll out at KAVAK, which is the Carvana of Mexico; and AXA Insurance, with KAVAK having the potential for 10,000 units annually and AXA having the potential for an additional 2,400 units. This is just very cool. Our India team working under Cellocator is just -- has been working with Tata Consulting Services, and we've been selected to provide mobility platforms for a 6,000 unit IoT project in Northern Europe.

In our vehicle segment, we are launching newer Cat M1 and Cat M platforms, and we are seeing significant interest in the construction equipment segment. So, this growing interest and traction was confirmed by our reseller agreement that we recently signed with a major construction equipment company for a minimum 2,500 units annually, which started shipping in Q1. In addition to this big win, we are currently in field trials with three large construction equipment prospects. PowerFleet continues to enhance our solution for vehicle Class 1 to 5 customers that smaller vehicles used in our service fleets and delivery and commercial fleets, with a focus on car sharing and rental self-service.

These offerings within rental fleets have seen an increase due to COVID to the demand for touchless interaction as well as mid-term car rental and fractional ownership as an alternative to public transportation and personal car ownership. As we look ahead to 2021, the end market demand for our dry van, container and cold chain mobility platforms are steadily improving North America and globally. We now have a very strong balance sheet that gives us the capability to move diligently and quickly on potential acquisitions that can bolster our position geographically, grow our business segments as we expand this product, software and analytics software. As the global economy recovers and countries reopen, PowerFleet is well positioned to leverage our enhanced scale, strong balance sheet and expansive international footprint to really effectively compete and win global tenders.

We believe these factors will enable PowerFleet to capture an increasing share of the growing multibillion-dollar global industrial IoT market. And so with that, we are ready to open the call up for your questions. Operator, please provide the appropriate instructions.

Questions & Answers:

Operator

[Operator instructions] Our first question comes from Mike Walkley with Canaccord Genuity. Please proceed.

Mike Walkley -- Canaccord Genuity -- Analyst

Great. Thank you. Chris and Ned, I hope you and everyone's families on the call are staying healthy and well.

Chris Wolfe -- Chief Executive Officer

Thanks, Mike.

Mike Walkley -- Canaccord Genuity -- Analyst

Just -- Congrats again on another double-digit adjusted EBITDA margin to end the year. Chris, just on the solid backlog entering 2021, can you discuss areas of strength and any update on some of those large opportunities you were chasing? And maybe how you see the business improving throughout 2021 if economies continue to reopen?

Chris Wolfe -- Chief Executive Officer

Yes. Thanks, Mike. We're actually seeing -- you've seen the traction with new sales, but even coming into 2021, I -- previously we announced the Ryder logistics win. I think it was like June of last year.

We only installed six locations at Ryder in 2020, and there's 24 to go. So just on a scale, you can see it's almost a four x or more just with one customer alone. And we also -- Nucor Tubular, there's upside there in Kautex, which we announced last year on the industrial side. The industrial side was probably the hardest hit in 2020, and the fact that we're seeing that come back and come back fairly strong is phenomenally encouraging.

On the very large prospects, we're still pushing those. We do have some progress going on. I'm not quite -- because we're going up for Q4 right now. I don't want to get over my skis.

But again, that's kind of some of those wins that I mentioned: migrating old customers, like the United States Postal Service, Ford Motor Company. I think when you start seeing us deploy those locations this year, which we hope would start happening before the second half but we're definitely in the second half, that's when you'll start seeing those kind of break free on the industrial side. On the logistics side, those field trials we have are still going on and we expect the culmination here in Q1 and into Q2.

Mike Walkley -- Canaccord Genuity -- Analyst

Great. That's helpful. And then just on the quarter, another strong net add of 20,000 to get to 590,000. Maybe you can just talk about where you're seeing some strength? And are you still having any customers turning things off just due to impacted industries or is that behind you now and you should see steady growth barring any virus getting worse?

Chris Wolfe -- Chief Executive Officer

Yes, barring any virus getting worse, we are seeing -- it stabilized really in Q3, thank goodness, and then we're just seeing that stabilization. We're not seeing any major customer issues at this time as far as people in that kind of financial straits that they need to turn off units in mass. And by the way, we're actually getting to the 20,000 net add. It's just across the board, which is actually good for us.

I think if anyone who followed our story early on, it was always continued on one or two customers making or breaking the quarter. And now I think just the breadth of our company helps us just weather those kind of situations much better. So we're not really beholden to one particular customer in a quarter but again, it's really been across the board.

Mike Walkley -- Canaccord Genuity -- Analyst

Great. Last question for me, and I'll pass it on. Ned, product sales were a bit higher than expected. Most of those that had been turned on or converted to subs or that give you some visibility into sub growth already into the March quarter.

And then at 35% gross margin, I know mix can fluctuate quarter to quarter based on hardware. But is that kind of a good gross margin for 2021 on hardware as you look at kind of your backlog for 2021?

Ned Mavrommatis -- Chief Financial Officer

Sure, Mike. Yes. The first part of your question is absolutely. Every piece of hardware that we sell comes with the long-term service contracts.

So it's the high product revenue today gives us more visibility into growing service revenue. On the product margins, it's primarily mix. We have products that generate 20% gross margin. And then we have products that generate 45%.

So it's really the mix. I think between 30% and 35% on the product side, we feel very comfortable going forward.

Mike Walkley -- Canaccord Genuity -- Analyst

Great. Thanks for taking my questions and best wishes for a successful '21.

Chris Wolfe -- Chief Executive Officer

Thanks, Mike.

Ned Mavrommatis -- Chief Financial Officer

Thanks, Mike.

Operator

Our next question comes from Jaeson Schmidt with Lake Street. Please proceed.

Jaeson Schmidt -- Lake Street Advisors -- Analyst

Hey, guys. Thanks for taking my questions. Just curious if you could comment on what you've seen from an order pattern standpoint here in January and February, if some of the momentum you saw late last year has continued here in the first two months of the quarter.

Chris Wolfe -- Chief Executive Officer

Yes. I mean, again, we're not done and typically, a lot of our sales, like a lot of companies, they come in at the last month of the quarter. But again, we haven't seen it slow down. A matter of fact, if anything, we've seen business activity picking up and -- which is good, especially in our indirect channels because that -- they have more touch points in the overall global economy, especially like in the U.S.

economy, which is the biggest markets that we're in. So again, the activity level has been high. I myself attend almost every sales pipeline call. And it's probably the strongest calls I've been in probably in the last two years, even pre-COVID.

Jaeson Schmidt -- Lake Street Advisors -- Analyst

OK. That's helpful. And then could you just give us an update on where you're at with the other rental car company?

Chris Wolfe -- Chief Executive Officer

Conversations continue. And matter of fact, there is a third-party that's just recently started an RFP in that area. So another rental car company that's also major. So again, we're participating in that RFP as well.

So conversations continue there. Again, I think it's going to be slow going with that major rental car company, but I -- the interest level is still there, and we just keep them updated on what we're doing. And it's just really up to them when they want to -- and when they can do a program, right, because they need to do what we call a large-scale field trial, and we have a proposal in front of them right now to do that.

Jaeson Schmidt -- Lake Street Advisors -- Analyst

OK. And the last one for me, and I'll jump back into queue. Ned, how should we think about opex ramping here in 2021?

Ned Mavrommatis -- Chief Financial Officer

We are going to slightly start investing a little bit more in sales and marketing. As Chris mentioned, we're beginning to see a significant increase in the activity and people doing business. So we are going to start investing a bit but again, very conscious. Our goal is to have profitable growth.

Jaeson Schmidt -- Lake Street Advisors -- Analyst

OK. Thanks a lot, guys.

Chris Wolfe -- Chief Executive Officer

Thanks, Jaeson.

Operator

[Operator instructions] Our next question comes from Scott Searle with ROTH Capital. Please proceed.

Scott Searle -- ROTH Capital Partners -- Analyst

Hey. Good morning. Thanks for taking my questions. Hey, just to follow up on the gross margin front, Ned, I know that there is volatility quarter-to-quarter depending on mix but we've seen a lot of component issues throughout the industry and the supply chains with other vendors.

Are you seeing any issues on that front? How is that impacting not only your gross margins, but your ability to ship in service or are you seeing any pushouts on that front?

Ned Mavrommatis -- Chief Financial Officer

I'll just talk a little bit about the gross margin, and then Chris can talk a little about the supply chain. When you look at our service gross margins, they're very consistent at 65% and growing. In Q4, the product gross margins were not impacted at all by the supply chain issues. It was just primarily mix.

And as I mentioned before, we feel comfortable looking at it going forward. The product gross margins being anywhere from 30% to 35%. As we look forward, the supply chain is an issue not only for us, but the whole industry. So Chris, maybe you want to take that one?

Chris Wolfe -- Chief Executive Officer

Yes. There's -- to be very specific, there's a couple of components, actually module shortages that have been going on that have not necessarily impacted us as of yet, and we're in the middle of, like, making sure they don't. So by pulling in orders, you'll probably see some of our inventory go up just to make sure that we have ample supply for -- and for also for surge, getting back to the other question about large field trials that come to culmination. For modules and supercaps, the long lead times.

So that's what we're trying to do right now. It's just remediate any risk and make sure that we can take advantage of upside by pulling in subcomponents and modules early. We don't have to do the build-out of the full product that we can pull in the parts so that we have ample supply. But it is concerning, and some of the long lead times are getting into like six months, right? So you have to plan ahead.

Scott Searle -- ROTH Capital Partners -- Analyst

Gotcha. And just to follow up on some earlier comments for clarification with the United States Postal Service. It sounds like now that is moving ahead. It's just a timing issue.

And to follow up on your comment on Budget. Is Budget now just specifically through Pointer in Israel or is that expanding out to Budget globally?

Chris Wolfe -- Chief Executive Officer

Yes, Avis Budget Group -- I mean, by the way, Budget is part of Avis. So in the U.S., some of the 120,000 units they took or could be in the Budget portfolio. This is a licensee of Avis Budget Group. So again, every -- our contract with Avis actually allows us to sell to the licensees, which there's quite a few, like in most of the international countries.

So we've had been approached by other countries as well like Mexico, etc. And so whether or not they go with our Avis product directly or they go with a different product that we get -- got from the Pointer acquisition, we're approaching them with like our portfolio of products, and that was a win using one of the Pointer products but it's still a great win for a licensee.

Scott Searle -- ROTH Capital Partners -- Analyst

Gotcha. And U.S. Postal Service?

Chris Wolfe -- Chief Executive Officer

Yes. I think you're -- I don't want to get too far ahead yet, but there's great conversations going on there and great planning going on. So once you start seeing -- we'll basically put out an announcement when we can -- when we start deploying at facilities, and we hope that will begin a couple of months.

Scott Searle -- ROTH Capital Partners -- Analyst

Great. And lastly, if I could, just given the mix of business and where you're shifting, you're moving to more value, I'm kind of wondering how you're thinking about recurring revenue from an ARPU standpoint as you start to win some of these higher-value opportunities, including weight on axle and other weight sensor-driven initiatives. And also as you're kind of moving into some different directions, cold chain keeps coming up a lot. I'm wondering if the competitive list of vendors or the short list you're fighting against is changing at all.

Thanks.

Chris Wolfe -- Chief Executive Officer

OK. So when it gets back to like weight on axle and somewhat like -- again, I mentioned our freight camera as well. Those are very high-value type of products that we offer, our freight camera. People don't know we actually do machine learning on imaging.

We can tell how trailers are loaded, if there's been a shift in transit. We can actually help you tell you how to unload a trailer now for the first time versus just loaded and empty. That's tied to weight on axle. And you can tell we have more visibility, which can help our customers increase their velocity, and that's actually the whole issue with the industry in general, is there are certain choke points that we're trying to address specifically, like at the point of -- the port of Los Angeles and the chassis container issue out there or it's the getting trucks in and out of yards faster by really knowing where trailers are in the proper location or chassis or containers.

So with that, our price point is more of a solution sale now. So what we do is we go into sell a solution to solve a problem, and that does typically include a hardware sale just because there's a hardware component to it in edge computing, but it also includes our analytics and our software. So getting back to the ARPU, it kind of depends on the vertical you're in and the actual solution. But to -- yes, the ARPU is typically going to be higher than our standard would be for -- like a chassis tracking product right now is typically $4 to $5 a month.

And then this could be $5 or $6 added on for the extra weight data. And the same with our freight camera, you get an extra dollar. At the same time, by the way, as we move to 5G, we get the added benefit of the lower data rates, and so we can actually send more data, more sensor data through the pipeline. And lastly, on the cold chain question, that's a great question.

We are now competing on projects with systems integrators. So by the way, we're now also partnering with the systems integrators. I mentioned Tata Consulting Services. They're the largest in the world, I believe, today.

If not the largest, the second. So for us, to actually partner up with Tata is just a phenomenal opportunity for the company. So we can either do it ourselves, which we've done this like with the American Intermodal Management, which we did with Avis, like we did with the United States Postal Service years ago or we can partner up with a stronger partner and go after IoT wins that way. But so again, I think our capability is to be nimble.

And I think being an innovatively nimble technology provider in the IoT space is our differentiator. So we can naturally go in, listen to what the problem is, fix the problem. And for that, get remunerated for it.

Scott Searle -- ROTH Capital Partners -- Analyst

Great. Thank you.

Chris Wolfe -- Chief Executive Officer

OK. Thanks.

Operator

Our final question is from Gary Prestopino with Barrington Research. Please proceed.

Gary Prestopino -- Barrington Research -- Analyst

Hey. Good morning, everyone. I just want to clarify. You had 590,000 on-air subscriber units at the end of the year?

Chris Wolfe -- Chief Executive Officer

Yes.

Gary Prestopino -- Barrington Research -- Analyst

OK. And then, Chris, what -- could you maybe give us an idea directionally? I mean relative to the end of last year, what has been the growth in your backlog overall?

Chris Wolfe -- Chief Executive Officer

I mentioned earlier, I think it's been more broader across the board. Like in Israel with our -- right now, I mean two years ago, there was not any IoT programs going on in Israel -- in our Israel operation. It was all vehicle sales through OEMs and doing SVR. Now 10% of the revenue out of Israel is just all IoT projects.

So I mean that's normal two years. So we actually see that trend continuing, and it's a focused initiative. And at the same time, in our logistics segment, which we invested heavily in the Panhandle Group, the 6,000 unit container fleet at the McGuire. And you'll -- we're seeing very good traction uptake.

And by the way, we don't even announce like when current customers refresh in that necessarily. But again, that's -- you're seeing a nice, steady progression of sales on the logistics side. And the industrial side has always been the lumpiest part of the business because their capex is all about -- it's a cost center, right? The warehouse and the shipping facility is usually a cost center. So when the economy goes down, you're not going to add cost to a cost center, typically.

That's going to be the first thing hit, and so that's what hit us last year. But we're seeing that nice again, because of that business activity picking up, more things being built. So our manufacturing segment in the industrial side is starting to recover, like I mentioned, Toyota manufacturing. And so everything was put on hold at Toyota all -- right at the end.

So now we're starting to see that come back to life, which is awesome.

Gary Prestopino -- Barrington Research -- Analyst

OK. Great. And then lastly, Ned, can you provide us with the components of non-GAAP net income for all of the quarters for 2019 and 2020 for modeling purposes?

Ned Mavrommatis -- Chief Financial Officer

Sure, I can. Obviously, it's in the press release, there's a table, Gary, that has the GAAP to non GAAP. So I don't want to read it over the conference.

Gary Prestopino -- Barrington Research -- Analyst

No, I'm looking at the press release, and I'm seeing it for December and for the year, all right, quarter and the year. Maybe I don't have the full press release popped up here. But I'm -- there is a breakdown by Q1, Q2, Q3 for 2019 and 2020 of all individual components.

Ned Mavrommatis -- Chief Financial Officer

Yes, and I'll point that out to you after the call if that's OK.

Gary Prestopino -- Barrington Research -- Analyst

OK. I'm sorry. I'm looking at this on two separate screens here. So all right, I'll take a look at it.

Thank you.

Ned Mavrommatis -- Chief Financial Officer

OK. Thanks.

Chris Wolfe -- Chief Executive Officer

Thanks, Gary.

Operator

We have reached the end of the question-and-answer session, and I will now turn the call over to Chris Wolfe for closing remarks.

Chris Wolfe -- Chief Executive Officer

Thank you for joining us today. I'd like to thank our employees for their diligent efforts and great results and our customers for putting their trust in our products and services and our investors for their support of our vision. Please stay healthy, and we look forward to speaking with you again soon. Thank you.

Operator

[Operator signoff]

Duration: 37 minutes

Call participants:

Chris Wolfe -- Chief Executive Officer

Ned Mavrommatis -- Chief Financial Officer

Mike Walkley -- Canaccord Genuity -- Analyst

Jaeson Schmidt -- Lake Street Advisors -- Analyst

Scott Searle -- ROTH Capital Partners -- Analyst

Gary Prestopino -- Barrington Research -- Analyst

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