Sierra Wireless (SWIR) released first-quarter 2019 results on Thursday after the market closed, highlighting simplified segment reporting and top- and bottom-line results near the more encouraging ends of light guidance that left investors underwhelmed in February. 

With shares of the Internet of Things (IoT) pure play up around 5% in after-hours trading as the market absorbs the news, let's have a closer look at what drove Sierra Wireless over the past few months.

Cityscape showing a graph of multiple connected devices.


Sierra Wireless' results: The raw numbers


Q1 2019

Q1 2018

Year-Over-Year Growth


$173.8 million

$186.8 million


GAAP net income (loss)

($11.2 million)

($8.4 million)


GAAP earnings (loss) per share




DATA SOURCE: SIERRA WIRELESS. GAAP = generally accepted accounting principles.

What happened with Sierra Wireless this quarter?

  • On an adjusted (non-GAAP) basis, which excludes items like stock-based compensation and acquisition costs, Sierra Wireless incurred a net loss of $0.9 million, or $0.02 per share, compared to earnings of $3.3 million, or $0.09 per share in the same year-ago period.
  • These results were near the high ends of guidance provided in February for an adjusted net loss per share of $0.06 to $0.02 and revenue in the range of $170 million to $174 million.
  • Product revenue declined 7.3%, to $151.1 million.
  • Services and other revenue fell 5.2%, to $22.7 million. 
  • Starting this quarter, Sierra Wireless is simplifying its reporting into two operating segments (down from three before) to provide more clarity on its device-to-cloud solutions activities. These segments are:
    • IoT solutions, where quarterly revenue climbed 5.4% year over year, to $94.3 million
    • Embedded broadband, where revenue declined 18.4%, to $79.5 million
  • Adjusted EBITDA declined 50%, to $4.5 million.
  • On April 30, subsequent to the end of the quarter, Sierra Wireless internally announced incremental cost-reduction initiatives including plans to reduce the size of its Paris-based development team, further consolidate research and development (R&D) in Canada and Asia, and outsourcing certain transaction-based services.

What management had to say

"We are making good progress driving improved efficiency throughout our operations to accelerate our transformation into a leading global IoT solutions provider," stated Sierra Wireless CEO Kent Thexton. "At the same time, we are investing in innovative cellular technologies and capabilities to enhance our differentiated Device-To-Cloud offering and grow our recurring subscription-based revenue."

Looking forward

Sierra Wireless reaffirmed its outlook for 2019 revenue to be roughly flat from 2018 and for full-year adjusted EBITDA of roughly $35 million. But given its relative outperformance in the first quarter and subsequent cost-reduction initiatives, the company now sees 2019 adjusted net income per share in the range of $0.30 to $0.35, up from its previous guidance targeting the low end of that range.

All told, this performance certainly won't drop the jaws of many growth-hungry investors, even if it seems to undersell Sierra Wireless' enviable longer-term growth potential. But it was a strong quarter relative to the low bar Sierra Wireless set for itself earlier this year, and the stock is understandably rebounding as a result.