Shares of Sierra Wireless, Inc. (SWIR) were up 29% as of 12:30 p.m. EST on Friday after the Internet of Things pure play reported strong fourth-quarter 2016 results.
Quarterly revenue climbed 12.5% year over year, to $163 million, and translated to adjusted net income of $8.8 million, or $0.27 per share. That's up from $2.5 million, or $0.08 per share, in last year's fourth quarter. For perspective, Sierra Wireless' guidance called for Q4 revenue of $157 million to $166 million, and adjusted earnings per share in the range of $0.13 to $0.19. Sierra Wireless management credited their outsized profitability to a combination of higher revenue, strong gross margin, and the company's continued focus on cost-management initiatives.
Perhaps most notably within Sierra Wireless' top line, original equipment manufacturer solutions revenue climbed 11.2% year over year, to $163 million, reflecting continued contributions from new programs, and normalized demand from key existing customers and programs -- as management promised last quarter. Revenue from the enterprise solutions segment also climbed 27.1%, to $21 million, while the smaller cloud and connectivity services' segment revenue was flat, at roughly $6.8 million.
In addition, Sierra Wireless issued guidance for first-quarter 2017 revenue of $152 million to $161 million, which should translate to adjusted earnings per share of $0.13 to $0.20. Analysts, on average, were looking for revenue slightly below the midpoint of that range, with significantly lower adjusted earnings of $0.12 per share.
In short, this was a strong quarterly beat from Sierra Wireless, followed by solid guidance indicating more of the same going forward. With Sierra Wireless positioned well to take advantage of the burgeoning Internet of Things market opportunity, it's no surprise to see shares trading near a fresh 52-week high today.