When it comes to investing in the most promising technology trends, few offer as much potential as the Internet of Things -- that is, the growing practice of adding internet connectivity to everyday "things" that normally wouldn't have it.

Yet there are few Internet of Things pure plays available to investors. That's where Sierra Wireless (NASDAQ:SWIR), the world's No. 1 cellular module vendor, stands out from the rest as arguably the best way investors can put their money to work in this burgeoning space.

Let's take a closer look at how Sierra Wireless makes most of its money, as well as up-and-coming segments that should help supplement its current core business down the road.

A cityscape at night, with superimposed points of light connecting to each other, representing a connected city.

IMAGE source: Getty Images.

A healthy core

Sierra Wireless' second-quarter 2017 results, released early last month, offer a reasonable picture of its current revenue and earnings profile. In particular, revenue from its OEM solutions business climbed 9% year over year to $144.5 million, representing more than 83% of Sierra Wireless' total sales. OEM solutions also maintained healthy adjusted gross margin of 32.1%.

That doesn't mean Sierra Wireless is overexposed to any one market segment. During last quarter's earnings conference call, CEO Jason Cohenour credited the relative strength of its OEM solutions business to "solid contributions [from] established OEM customers and programs across a broad range of segments including automotive, networking, security, and mobile computing." 

In addition, Cohenour says, revenue from new OEM customers and programs continues to grow; Sierra Wireless secured a higher-than-average number of design wins through the first half of the year, spread across segments including automotive transportation, sales and payments, and networking.

A shifting business

Sierra Wireless is also fostering two primary segments outside of OEM solutions, including enterprise solutions and the newer cloud and connectivity services business.

For perspective on the former, second-quarter enterprise solutions revenue increased more than 30% year over year last quarter to $21.7 million, helped by strength in shipments of gateways and routers into the industrial, energy, public safety, and transit markets. Enterprise Solutions also benefited from incremental sales of telematics products, gateways, and tracking devices acquired along with its $7.8 million purchase of fleet telematics specialist GenX Mobile last year. And enterprise gross margin is attractive, most recently hovering at 47.5% in Q2.

Meanwhile, Sierra Wireless' cloud and connectivity business saw revenue rise a more modest 4.3% (8.4% at constant currency) last quarter to $7.3 million, primarily comprised of recurring services revenue, with adjusted gross margin of 42.6%. This smaller segment was formerly included under enterprise solutions until late 2015, when cloud and connectivity-specific revenue began to represent a more material slice of Sierra Wireless' overall pie. As it stands, Sierra Wireless is focusing primarily on building the cloud and connectivity customer base and pipeline with the help of its larger two segments; more than 50% of new cloud and connectivity customers and program wins have originated from the OEM and enterprise solutions businesses.

And similar to the enterprise-centric buy of GenX, Sierra Wireless isn't afraid to pursue acquisitive growth here; last quarter it announced an agreement to purchase managed enterprise solutions company Numerex (NASDAQ:NMRX) in a stock-for-stock deal valued at roughly $107 million. Numerex, and its estimated $66 million in annualized revenue this year, will be categorized under Sierra Wireless' cloud and connectivity services business.

Investors can expect the influence of these smaller segments to increase even more in the future. Even before the Numerex deal was announced, Cohenour told investors the company was "working very hard to drive the overall mix of the business to favor higher growth in both enterprise and cloud and connectivity" -- a move almost certainly encouraged by their smaller revenue bases, growing addressable markets, and outsize profitability.

While Sierra Wireless might currently collect the majority of its revenue and profits from OEM solutions, its core business will almost certainly change in the coming years. Assuming Sierra Wireless sustains its healthy pace of new design wins and customer growth in the process, it should be nicely positioned to continue delivering market-beating gains for shareholders.

Steve Symington has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Sierra Wireless. The Motley Fool has a disclosure policy.