Sequans Communications (SQNS) Q4 2025 earnings summary

Executive summary

• Q4 2025 revenue reached $7 million, up 72.6% sequentially but down 37% year-over-year due to prior-year license revenue from Qualcomm; full-year revenue was $27.2 million, with adjusted core business revenue at about $20 million.

• Product sales accounted for over 94% of Q4 revenue, reflecting a shift to product-driven sales and strong shipment growth.

• The company is focused on executing its IoT strategy, advancing its 5G roadmap, and managing its Bitcoin digital asset treasury to maximize shareholder value.

• A disciplined approach to capital allocation includes significant share repurchases, ongoing cost optimization, and balancing IoT growth with Bitcoin treasury management.

• Strong order backlog and a $300 million design-win pipeline, with over 44% in mass production.

Financial highlights

• Q4 2025 revenues increased 72.6% sequentially, driven by product revenue growth, but gross margin fell to 37.7% due to inventory provisions and a higher share of product sales.

• R&D and SG&A expenses declined to $11.5 million in Q4 from $13.6 million in Q3.

• IFRS net loss for Q4 was $87.1 million, including a $56.9 million unrealized Bitcoin impairment and $8.4 million realized loss on Bitcoin sales; non-IFRS net loss was $18.5 million.

• Operating loss for Q4 2025 was $74.5 million.

• Cash and cash equivalents at year-end 2025 totaled $13.4 million.

Outlook and guidance

• 2026 revenue is targeted at $40–$45 million, with improving visibility and a significant order backlog.

• Q1 2026 revenue expected around $6.5 million, with potential for $1 million to shift to Q2 due to shipment timing.

• Revenue is expected to ramp through 2026, with a goal of reaching cash flow breakeven by Q4.

• By mid-2026, over 50% of current design win projects are expected to be in production.

• Additional projects expected to enter mass production throughout 2026.