Sonim Technologies (SONM) Reports Fourth Quarter Revenue of $15.9 Million and Net Loss of $11.7 Million
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Sonim Technologies, Inc. (Nasdaq: SONM)a leading U.S. provider of ultra-rugged mobile devices, accessories and solutions designed specifically for workers physically engaged in their work environment, released its financial results for the fourth quarter and fiscal year ended 31 December 2021.
Fourth quarter 2021 and recent highlights
- Net revenues for the fourth quarter of 2021 were $15.9 million, an increase of 10.4% compared to $14.4 million in the third quarter of 2021.
- Net loss in the fourth quarter of 2021 was $11.7 million, compared to a net loss of $10.9 million in the third quarter of 2021.
- Launched unlocked versions of the XP3plus ultra-rugged phone for global markets and versions for Canada with Telus and Bell.
- Won design awards from two Canadian carrier customers for Sonim’s next-generation ultra-rugged 5G smartphone and PTT-focused feature phone, slated for launch in Q3 2022.
- Ended the quarter with cash and cash equivalents of $11.2 million, compared to $10.2 million at September 30, 2021.
- Sonim’s announced XP8 smartphone is now supported by the Walkie Talkie app for Microsoft Teams, providing expanded PTT communications for frontline workers.
- Sonim raised $17.4 million in net proceeds through its market equity offering program in the fourth quarter of 2021 and does not plan to utilize its market equity offering program in the first quarter of 2022.
Said Bob Tirva, President, CFO and COO, “We are thrilled with the response to our next-generation XP3plus rugged flip phone, which is now available from several major carriers in the United States, Canada and, for first time in the business. landmark, opening up globally addressable market opportunities for further international expansion. We continued to make good progress in the development of our additional next-generation products slated for initial release in the third quarter. These additional products include a new 5G rugged smartphone and a feature phone with new features commonly found on radios, making it an ideal solution for the growing Push-to-Talk over Cellular (PTToC) market. With the launch of these additional devices, we believe Sonim will have a completely renewed range of ultra-rugged mobile devices suitable for large global addressable markets where our unique design features deliver significant value to enterprise and public sector customers. .”
2021 financial resultsRevenue for the full year 2021 was $54.6 million, compared to $64.0 million for the full year 2020. Revenue reflects the product line changes as well as lower sales of some legacy products in Sonim’s product renewal cycle, partially offset by increased flip phone sales, driven by the launch of Sonim’s new XP3plus device.
Gross profit for the year ended December 31, 2021 was $6.4 million, or 11.8% of revenue, compared to 23.8% of revenue for the year ended December 31, 2020. Gross profit margin decline is primarily attributable to product sales mix as Sonim transitions to its next-generation devices. Higher product costs due to supply chain issues, higher shipping costs and one-time discounts on our scanner line contributed to lower margins. Sales of the next generation XP3plus and XP5s increased in 2021, but were offset by declining sales of the XP8 as it neared end of life. The launch of an updated smartphone in the third quarter of 2022 is expected to replace the XP8 and increase unit sales of our higher-margin smartphones in the second half of 2022.
Operating expenses for 2021 were $44.4 million, compared to $44.5 million in 2020. In 2021, lower personnel costs were partially offset by higher R&D expenses associated with the development of our next-generation products, an increase in legal fees which are expected to decrease in 2022 and one-time bad debt charges. Net loss for 2021 was $38.6 million, compared to $29.9 million in 2020.
Balance sheet and cash flowSonim ended the year with $11.2 million in cash and cash equivalents and remained essentially debt free. Accounts receivable increased to $10.8 million and inventory to $5.5 million. The company raised additional net proceeds of $17.4 million from its market share issuance program during the fourth quarter. The company does not plan to use this program during the first quarter of 2022.
As previously announced, Sonim has retained B. Riley as an investment banker to explore strategic alternatives and capital market options, including buy and sell opportunities.