Hello, and welcome to Inseego Corp.'s Third Quarter 2025 Financial Results Conference Call. Please note that today's event is being recorded [Operator Instructions] On the call today are Juho Sarvikas, Chief Executive Officer; and Steven Gatoff, Chief Financial Officer. During this call, certain non-GAAP financial measures will be discussed. A reconciliation to the most directly comparable GAAP financial measures is included in the earnings release, which is available on the Investors section of the company's website. An audio replay of this call will also be archived there. Please also be advised that today's discussion will contain forward-looking statements. These forward-looking statements are not historical facts, but rather are based on the company's current expectations and beliefs. For a discussion on factors that could cause actual results to differ materially from the expectations, please refer to the risk factors described in the company's Form 10-K, 10-Q and other SEC filings, which are available on the company's website. Please also refer to the cautionary note regarding forward-looking statements section contained in today's press release. With that, I'd like to turn the call over to Juho Sarvikas, Chief Executive Officer. Please go ahead.

Good afternoon, everyone, and thank you for joining us today. Q3 was another strong quarter for Inseego. We generated revenue of $45.9 million and adjusted EBITDA of $5.8 million, both above guidance and marking our second consecutive quarter of sequential growth in both metrics. Operationally, we continue to execute on the growth strategy I laid out earlier this year. Our strategy focuses on scaling our core FWA and mobile solutions in the enterprise market while also evolving into a solutions company that integrates hardware, network management and software into a single platform, enabling enterprises, carriers, MSOs, MSPs and VARs to build their wireless practice on Inseego. Our progress in executing and advancing these strategic value creation goals this quarter is reflected on 3 key accomplishments. First, we extended our FWA leadership while continuing to drive mobile performance. On FWA, we did this by driving growth with the FX4100 and expanding our portfolio with the announcement of our premium FX4200, which extends our TAM. As we announced on our last call, we also added a third Tier 1 U.S. carrier across both FWA and mobile starting to contribute revenue later in Q4. Second, we advanced the realization of our solution strategy with a major new release of Inseego Connect, expanding our software foundation for growth. And third, we further strengthened our leadership bench with the addition of seasoned C-level executives and 2 new operating experts on our Board of Directors, further enhancing our ability to scale and deliver sustainable, profitable growth. On today's call, I'll walk through these 3 key accomplishments, beginning with FWA. We continue to see strong demand for the FX4100 with T-Mobile, where deployments have scaled meaningfully across key verticals, including retail and utilities. These wins underscore the FX4100's ability to deliver enterprise-grade requirements across a broad spectrum…

Thanks, Juho. Hi, everyone. Thank you for joining us. I'd like to cover 3 topics today. First, I'll take you through our Q3 2025 financial results. Second, I'll provide a brief update on our capital structure. And third, I'll share some color on the financial profile of the business and provide guidance for Q4 2025. As we always do, we'll wrap up by opening the call to your questions. Let's start with Q3 results. We delivered our second consecutive quarter of sequential revenue growth, as you just heard Juho highlight. That performance was again paired with strong gross margins and with an efficient spend profile, we also delivered meaningful operating leverage and sequential growth in adjusted EBITDA and adjusted EBITDA margin. On the top line, total revenue for Q3 was $45.9 million and was driven by 3 dynamics: one, a particularly strong ramp in our FWA FX4100 product following its Q2 2025 launch, as Juho talked about; two, solid volumes of our MiFi M3100; and three, continued solid contribution from our software services offerings. It's notable to call out that FWA revenue was the second highest in company history and surpassed mobile hotspot revenue again this quarter, which is now the third time that's occurred. That crossover is a tangible data point of our strategy at work, scaling FWA over time, shifting the revenue mix and positioning the company for durable growth. As we've communicated, mobile revenue came in lower year-over-year as expected, reflecting the record carrier promotion in 2024. As a bit of a preview to our guidance, we see mobile revenue growing sequentially in Q4 2025 from a more fulsome contribution from an expanded customer set and products as new programs launch and our product line refresh begins to hit the market. And our software services revenue, which…

[Operator Instructions] And your first question today will come from Scott Searle with ROTH Capital.

Nice job on the quarter, guys. Steven, maybe to start on Subscribe and Connect. As you started to make some changes in investment, I'm wondering if you could take us through how the monetization changes and how you go to market and access to the channel, how we should be thinking about how that ramps up in '26 and beyond?

So, maybe I'll start with the Inseego Connect part. Today, we have a strong attach with our FWA together with the lead big carrier partner. What we've done and what's really important to understand with the FX4200 launch is that we've graduated Inseego Connect from what you could look at as a support tool to a core part of the enterprise platform. And we're driving usage to the cloud. The FX4200 will do a couple of things for us. It's going to expand our presence with the MSPs and MSOs as well as provide expansion with the carrier channel. So what you can expect to see with the FX4200 and with sequential launches is a richer value capture when it comes to the -- what I would call device cloud.

And then good question. On Subscribe, the counterpart on the software services, it's a piece of the business, Scott, that you know and as others know, we've begun to invest in. It's a really compelling part of the portfolio that complements what we do with our carrier customers and our MSOs and all of the strategic service providers that have similar wireless subscriber models. And so we continue to invest in that. We just onboarded and hired 2 executives in that business. And so they're getting up to speed right now. And so 2026 is what we look to be a growth year in that part of the business on the software side.

Very helpful. And maybe looking out into the first quarter, I think you addressed it sequential growth within the fourth quarter. There's typically a little bit of seasonality within that, I think as carriers have historically kind of worked down their inventory levels. But given the new product launches that you're expecting, it sounds like across MiFi in addition to new carrier wins starting to ramp up. Does one -- does the first quarter have different seasonality? Will we see sequential growth starting a little bit higher in the first quarter as we start to progress into '26?

Yes, a really good point. And also just to clarify a bit, part of the reason that Q4 is "seasonal" is just fewer selling days and weeks at the risk of stating the obvious with the last 2 weeks of December and the Thanksgiving week is just 3 fewer weeks. And so there's a little bit of math, less so industry dynamics. Whereas what you said in our view, Scott, is that you do see some end of year buying and inventory management so that sometimes January is a slower month. And so Q1, it's been a little bit different year-to-year here, but we are focused on making the most as we go into the year.

And Scott, on your note on this new carrier ramp and broad renewal, I believe we mentioned this in the prepared remarks. But when it comes to MiFi, the new carrier customer will start recurring revenue in Q1. In addition, we're renewing the existing 2 MiFi customers in Q1. What you should expect to see us do is to enter a, I'll call it, a higher velocity price point in the market, drive significant share gains when it comes to volume share and with that, continue to drive MiFi growth. Meanwhile, in FWA, the new carrier, we will start shipping a bit later in Q4. And then, of course, with that, we'll be in full motion with the new carrier with the FX4200 come Q1.

Got you. And if I could, just one last one, Juho, I guess from a higher level conceptual view of the industry, there's been a lot of different dynamics going on, starting with AT&T buying EchoStar Spectrum. So a couple of things. I'm wondering, how are you seeing that kind of play out into 2026 in terms of investment and growth in FWA in general. With the 4200 as well, you put a stake in the ground with more processing power at the edge. And I'm wondering how that's driving not only adoption cycles from a carrier perspective, but also revenue-generating opportunities for Inseego with recurring and otherwise. And then maybe just some thoughts as well in terms of the competitive landscape. It seems like you guys continue to gain share. Just kind of curious as to your high-level thoughts in terms of what you're seeing on the competitive front.

Scott, excellent set of questions. Let me start with the -- with the opportunity when it comes to wireless broadband, you're correct. Like if you look at the addressable market today, I would say that it's heavily constrained by available spectrum, right? Because the carrier needs to make sure that they take care of the high ARPU mobile customers. What happened with the EchoStar transaction with AT&T is that AT&T's mid-band assets dramatically increased. And that's really the sweet spot for FWA deployment. You might have seen there was some new news from FCC this week that they're looking at releasing more upper C-band, I believe it was 150 megahertz. All of this creates significant opportunity for the carrier to drive more FWA deployment. Why I think that we're extremely well positioned to capture on that opportunity is that we operate in the enterprise or in the business segment of the carrier portfolio, which obviously has a higher ARPU for the carrier than the consumer FWA. In addition, if you look at the business FWA or enterprise FWA, it consumes on average 1/8 of the network resource or bandwidth of a consumer household. So I think that trend is going to be extremely favorable for us, and we look forward to being the partner of choice for the carriers with our solution offer, which is really designed to deliver enterprise-grade wireless broadband that's easy to use, easy to deploy, and fits well with the carrier go-to-market motion where we also have significant investment. The opportunity space is huge. And to your point, continues to expand. One of the key things they are becoming spectrum availability. There's competition in the marketplace. But my very simple view here is that I think we have a unique position. On the other end of the spectrum, you have consumer grade, you could call white label FWA. And then you have very heavy complex, high cost of ownership solutions. We want to be that partner that's capable of driving mass scale deployment in strong alignment with the carrier and also starting with the MSOs and the MSPs like we mentioned in the prepared remarks.

And your next question today will come from Christian Schwab with Craig-Hallum Capital Group.

Congrats on the great quarter. As you look to the new customer ramping on both fixed wireless and mobile, can you give us an idea of the range of potential outcomes over the calendar '26 from revenue from this customer?

So if you look at the new customer addition, the hotspot or MiFi market is roughly -- this is not like exact accurate science, but you can think of it as 1/3, 1/3, 1/3 across the 3 carriers. And now what we've done is that we've unlocked the missing 1/3. So we expect to see significant volume growth. There is ASP erosion in the category, but that will be offset by -- that will be offset by the increase in volume. And that gives us good confidence on the MiFi side. On FWA, we have this unique motion with one of the large Tier 1s, T-Mobile today that I was just describing, we're super excited to establish the same partnership on FWA also with our new carrier customer.

Great. My second question has to do with the software business given the broadening of this customer in particular, but also some of your other Tier 1s, I'm under the impression that a substantial portion of your software revenue comes from T-Mobile. Is there an opportunity at some point in calendar '26 that they would -- that any -- that other Tier 1 customers could adopt the same software platform to manage the network that T-Mobile uses?

Yes, Christian, it's a really good question, and it's spot on what we were just talking about a moment ago, which is we do share that view and see a lot of opportunity for Subscribe Inseego. Subscribe is the wireless subscriber IoT device management across -- agnostic across all devices and carriers platform, SaaS platform. And so you may have heard me mention we just onboarded and created new roles, new leadership roles that did not exist at the company. And so the Board, the exec team are investing time, energy, people and capital to build the platform because of what you said. We see a decided opportunity, awesome that we have a large customer at Tier 1, great. No reason in the world why we shouldn't have more.

And if you look at the Inseego Connect, which is the device attached cloud, obviously, the name of the game is installed base. So I'm very happy with the solution that we've built, and now it's a matter of scaling that in the marketplace with a strong FWA attach. So if you take a longer time horizon a couple of years out, that's going to be a meaningful growth trajectory for us as well.

Great. And if I could just sneak in one last question regarding Scott's question on the market share gains in the competitive environment. Do you see an opportunity as you roll out new products targeted to the distribution channel and potentially less foreign competition?

I'm sorry, can you repeat the last part? I'm not sure if I heard you.

But potentially, the competitive front and some competitors might not be able to sell here. Is that an opportunity for you or not really?

Yes, yes, definitely. So we're actually uniquely positioned in that we have our engineering team here in San Diego, critical IP created in San Diego. If you look at the latest movement and everything that's being discussed, should there emerge an environment where for national security or for other reasons, U.S. and North America would prefer a domestic supplier is a great opportunity for us, absolutely.

Your next question today will come from Lance Vitanza with Cowen.

Can you hear me okay?

Yes.

So let me start with just sort of to follow up on the Tier 1 carrier contract. You mentioned that the FWA shipments begin over the next month or so versus mobile shipments beginning early in 2026. And I'm wondering, are we supposed to read anything into that staggered timing? Is FWA definitively a bigger priority either for you or with this customer or for the customer in general? And related to that, as you look out 1 to 2 years from now when sort of the dust is sort of settled, so to speak, how should we think about the volume mix in terms of units between FWA and mobile with this new Tier 1 customer?

Lance, great question. You might remember earlier in the year, what I was saying is that the -- the product development and let's call it, design win cycle is 9 to 12 months. It's a simple matter of when we close on the opportunity and how long it took to develop the solution, the right maturity that we're able to ship. So we're equally excited on both hotspot and FWA. And then if you look at the -- from a mobile to FWA mix perspective, mobile, again, because it's a large market controlled by a couple of large carriers, you will see a significant uptake from a volume standpoint of view when we start shipping with the new customer. But the mobile is also a fairly confined space. So I don't necessarily expect to see significant market growth in mobile. Meanwhile, our thesis is that the FWA enterprise opportunity, be that carrier MSO or MSP, we're only at the early stages of that. And we expect to see market growth and, of course, share gains within that market.

That's helpful. And then one other question. There's been action at the FCC against "untrustworthy gear" coming from foreign adversaries. And I'm wondering if this is something you're following. It looks like the FCC voted last week to close loopholes, which could cause network operators to actually go ahead and replace components in their networks. Is this something that could favorably bear on results in 2026 for you? And are you contemplating any of that? Or is this just beyond the scale?

Lance, I think this is a really important opportunity space for Inseego. And again, as a North America is U.S. OEM, we're uniquely positioned to capitalize on that. I think it's very good that the focus is in addition to the infrastructure, the macro network, where actions have already been taken. To me, it makes a whole lot of sense that the focus is now moving into the CPE or the broadband devices, whether that's hotspot or FWA and even looking at a level deeper where the IP is designed in U.S. as opposed to perhaps white labeling Chinese design, Chinese software. So I see this as a significant upside opportunity for us as a company.

And your next question today will come from Nick Rubino with Stifel.

This is Cam Tierney on behalf of Tore Svanberg at Stifel. Congrats on the quarter. I wanted to drill down a little bit into the Inseego Connect API that you guys rolled out, I believe it was last quarter. I'm curious if you -- what sort of like early read-throughs you guys are seeing from that? Any feedback from customers about how they're using it or whether that's driving service revenue attach rates?

We actually -- Cam, that's a great question. Thanks for joining us. So we just had our Channel Advisory council when it was 2 weeks ago, one of the -- like my biggest takeaway was that the APIs that we spent part of this year in building was a fantastic investment. The feedback was overwhelmingly positive. Look, we want to be the best partner, whether you're an MSP, MSO or a carrier. And there are instances where it makes sense to consume our Inseego Connect device management to the service provider, a single pane of glass, if you will, so that we can integrate our solution offer as a part of a total solution offer. And that's exactly what the APIs does. The APIs are very important as we extend to MSOs, MSO cellular failover use cases, and it is a requirement when engaging with the MSP community.

Okay. Awesome. And then second question is, I just wanted to drill down a little bit more into the FWA sort of longer-term view. Obviously, the last couple of quarters, it's sort of exceeded the mobile business significantly. I'm curious if that's sort of more of a longer-term trend that you guys are seeing? And maybe could we expect then into 2026 and beyond? Or is that sort of more short-term chop in the business?

Yes. No, good question and a very important clarification to get out there for sure for how you're thinking about it, which is FWA is an important growth driver now and going forward. So we don't see it as chop. And if you go backwards in time, it probably was. It was more kind of one-off for various reasons. But the product portfolio, the technology, the customer breadth is much more diverse now and going forward. And so you're seeing a more steady growth CAM going forward. And so we see that contributing to both dollars and growth rate going forward.

Yes. Maybe to double-click on that, the strong Q3 on FWA was driven by our large carrier customer. In Q4, we diversified both in terms of add incremental revenue streams, both in terms of the new product and also in terms of new channels. So you should absolutely expect to see us further expand our portfolio as well as our market reach in terms of channels and market share as we go into 2026.

This concludes our question-and-answer session. I'd like to turn the call back over to Juho for any closing remarks.

Thank you for the insightful questions and for joining our call this afternoon. Steven and I will be attending a few sell-side conferences this month. We will be at the Craig-Hallum, ROTH and Needham conferences in New York in 2 weeks. We're particularly proud to be celebrating Inseego's 25th anniversary as a public company, hosting the closing bell on NASDAQ on Monday, December 8, a meaningful milestone for our employees, shareholders and the company as a whole. Thank you again for your time today, and we look forward to speaking with you soon.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.