M2M success fuels earnings growth at Sierra Wireless

Sierra Wireless (Richmond, Canada) has reported impressive top-line gains and profits on the back of its growing M2M business and sales of 4G products.

The vendor—which makes modems, routers and gateways and develops software and services for wireless applications—reported a 19.7% year-on-year increase in revenues, to $167.4 million, for the second quarter of 2012.

Net earnings, meanwhile, came in at $3.58 million, compared with a loss of $6.77 million for the same period last year.

Sierra Wireless (Richmond, Canada) has reported impressive top-line gains and profits on the back of its growing M2M business and sales of 4G products.

The vendor—which makes modems, routers and gateways and develops software and services for wireless applications—reported a 19.7% year-on-year increase in revenues, to $167.4 million, for the second quarter of 2012.

Net earnings, meanwhile, came in at $3.58 million, compared with a loss of $6.77 million for the same period last year.

Sierra Wireless attributes the success to strong sales of its 4G mobile computing products and the steady growth of its M2M business.

Mobile computing revenues were $89.9 million, compared with $66 million for the second quarter of last year, while M2M revenues were $77.5 million, next to $73.9 million in 2011.

“Exceptionally strong sales of our 4G mobile computing products, combined with steady growth in our M2M business, led to higher-than-expected revenue and profitability in the second quarter of 2012,” said Jason Cohenour, president and chief executive officer of Sierra Wireless. “In addition, our successful acquisition of Sagemcom’s M2M business expands our leading market share position and further accelerates our growth in the exciting M2M market.”

Sierra Wireless wrapped up its acquisition of Sagemcom’s M2M business earlier this month, paying cash of €44.9 million ($55.5 million) and assuming liabilities.

The French company had previously built a strong position in certain parts of the M2M industry, including payment, transportation and railways, and had also expanded its business into Brazil.

Sierra Wireless faced higher income tax expenses last quarter than in the same period of 2011 but managed to keep other costs at about the same level, explaining the turnaround at the bottom line.