Inseego (INSG) To Report Q4 Earnings: What's In The Cards?

Inseego Corp. (NASDAQ:INSG) is set to report fourth-quarter 2019 results on March 11.

The company expects fourth-quarter revenues between $48 million and $55 million. The Zacks Consensus Estimate for revenues is currently pegged at $52.5 million, which suggests a decline of 6.4% from the year-ago quarter.

For the quarter under review, the Zacks Consensus Estimate for loss has been steady at 8 cents per share in the past 30 days. Notably, the company had reported earnings of 2 cents per share in the prior-year quarter.

Notably, in the trailing four quarters, the company beat the Zacks Consensus Estimate in one, came in line once, and missed the same in the last two quarters. It has a trailing four-quarter negative earnings surprise of 33.3%, on average.

Inseego Corp. Price and EPS Surprise

Key Factors to Consider

Inseego’s fourth-quarter performance is expected to have benefited from growing traction of its 5G based solutions.

Notably, the company’s revenues were up 24% year over year in the third quarter, driven by 5G revenues, and this momentum is expected to have continued in the to-be-reported quarter. This is due to the rapid adoption of 5G in the market.

Inseego’s strong portfolio of 4G solutions is also expected to get reflected in the fourth-quarter results.

Additionally, the company’s Skyus line of industrial IoT products has been gaining traction due to expansion in the software-defined wide area network (SD WAN) market. This has enabled the company to partner with top SD WAN providers like VMWare (NYSE:VMW) , Riverbed and Cisco (NASDAQ:CSCO) Meraki.

Further, strong demand for Inseego’s enterprise SaaS solutions in international markets is likely to have contributed to the fourth-quarter performance.

Notably, the company witnessed continued double-digit recurring revenue growth from Europe and the U.K in the third quarter. Bookings were also up for the Inseego’s Ctrack platform in South Africa, Australia and New Zealand.

However, the company anticipates promotional change at its largest customer — Verizon (NYSE:VZ) , and seasonality in business to have weighed on the fourth-quarter performance.

Additionally, increased expenditure on research & development for the development of 5G is expected to have kept margins under pressure.

Key Q4 Developments

The company partnered with AT&T (NYSE:T) to launch its FirstNet approved USB 800 modem. Moreover, it partnered with Telstra in Australia to launch its new IoT tracker.

Zacks Rank

Inseego currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

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