Sierra Wireless Reports Fourth Quarter and Full Year 2013 Results

  Sierra Wireless Reports Fourth Quarter and Full Year 2013 Results

Business Wire

VANCOUVER, British Columbia -- February 5, 2014

Sierra Wireless, Inc. (NASDAQ:SWIR) (TSX:SW):

Q4 highlights from continuing operations

  *Record revenue of $118.6 million, up 5.7% compared to Q3, 2013
  *Adjusted EBITDA of $6.2 million, compared to $5.9 million in Q3, 2013
  *Non-GAAP earnings from operations of $2.6 million, compared to $2.4
    million in Q3, 2013

Full year highlights from continuing operations

  *Record revenue of $441.9 million, up 11.2% year-over-year
  *Adjusted EBITDA of $18.7 million, up 47.9% year-over-year
  *Non-GAAP earnings from operations of $5.0 million, compared to $0.9
    million in 2012

Sierra Wireless, Inc. (NASDAQ:SWIR) (TSX:SW) today reported results for its
fourth quarter and full year, ending December 31, 2013. All results are
reported in U.S. dollars and are prepared in accordance with United States
generally accepted accounting principles (GAAP), except as otherwise indicated
below.

“We achieved record revenue in the fourth quarter, closing out a year in which
we delivered solid operational results, sold our AirCard business, and began
putting the proceeds to work on acquisitions that extend our leadership
position in M2M,” said Jason Cohenour, President and Chief Executive Officer.
“We are exceptionally well positioned to capture the long-term M2M growth
opportunity, and we are focused on continuing to drive profitable organic
revenue growth, while we pursue additional acquisitions.”

As a result of the sale of the AirCard business, as well as our recent
acquisition of the AnyDATA M2M business and our contemplated acquisition of In
Motion Technology, our segments have changed from those reported at December
31, 2012. We are now reporting two segments, OEM Solutions and Enterprise
Solutions, and all prior periods have been retrospectively adjusted to reflect
the two segments.

Q4 2013

Revenue for the fourth quarter of 2013 was $118.6 million, an increase of 8.4%
compared to $109.4 million in the fourth quarter of 2012, and an increase of
5.7% compared to $112.3 million in the third quarter of 2013. Revenue from OEM
Solutions was $101.8 million in the fourth quarter of 2013, up 7.4% compared
to $94.9 million in the fourth quarter of 2012. Revenue from Enterprise
Solutions was $16.8 million in the fourth quarter of 2013, up 15.3% compared
to $14.5 million in the fourth quarter of 2012.

GAAP

  *Gross margin was $38.4 million, or 32.4% of revenue, in the fourth quarter
    of 2013, compared to $36.2 million, or 33.1% of revenue, in the fourth
    quarter of 2012.
  *Operating expenses were $42.0 million and loss from operations was $3.5
    million in the fourth quarter of 2013, compared to operating expenses of
    $37.7 million and a loss from operations of $1.5 million in the fourth
    quarter of 2012.
  *Net loss from continuing operations was $1.9 million, or $0.06 per diluted
    share, in the fourth quarter of 2013, compared to net earnings from
    continuing operations of $15.5 million, or $0.50 per diluted share, in the
    fourth quarter of 2012. Net earnings in Q4, 2012 included an income tax
    recovery that was the result of the recognition of certain tax assets that
    were realizable as a result of the sale of the AirCard business.
  *Net loss for continuing and discontinued operations^(1) was $0.9 million,
    or $0.03 per diluted share, in the fourth quarter of 2013, compared to net
    earnings of $19.6 million, or $0.64 per diluted share, in the fourth
    quarter of 2012.

NON-GAAP

  *Gross margin was 32.5% in the fourth quarter of 2013, compared to 33.2% in
    the fourth quarter of 2012.
  *Operating expenses were $36.0 million and earnings from operations were
    $2.6 million in the fourth quarter of 2013, compared to operating expenses
    of $32.6 million and earnings from operations of $3.7 million in the
    fourth quarter of 2012.
  *Adjusted earnings before interest, taxes, depreciation and amortization
    ("Adjusted EBITDA") were $6.2 million in the fourth quarter of 2013,
    compared to $7.0 million in the fourth quarter of 2012.
  *Net earnings from continuing operations were $3.1 million, or $0.10 per
    diluted share, in the fourth quarter of 2013, compared to $4.5 million, or
    $0.15 per diluted share, in the fourth quarter of 2012.

Full Year 2013

Revenue for the year ended December 31, 2013 was $441.9 million, up 11.2%
compared to $397.3 million for the year ended December 31, 2012. Revenue from
OEM Solutions was $382.0 million for the year ended December 31, 2013, up
10.2% compared to $346.5 million for the year ended December 31, 2012. Revenue
from Enterprise Solutions was $59.9 million for the year ended December 31,
2013, up 17.8% compared to $50.8 million for the year ended December 31, 2012.

GAAP

  *Gross margin was $145.6 million, or 33.0% of revenue, for the year ended
    December 31, 2013, compared to $125.3 million, or 31.5% of revenue, for
    the year ended December 31, 2012.
  *Operating expenses were $163.3 million and loss from operations was $17.7
    million for the year ended December 31, 2013, compared to operating
    expenses of $147.5 million and a loss from operations of $22.2 million for
    the year ended December 31, 2012.
  *Net loss from continuing operations was $15.6 million, or $0.50 per
    diluted share, for the year ended December 31, 2013, compared to a net
    loss of $4.2 million, or $0.14 per diluted share, for the year ended
    December 31, 2012. Net earnings in 2012 included an income tax recovery
    that was the result of the recognition of certain tax assets that were
    realizable as a result of the sale of the AirCard business.
  *Net earnings from continuing and discontinued operations^(1) was $55.0
    million, or $1.79 per diluted share, for the year ended December 31, 2013,
    compared to net earnings of $27.2 million, or $0.88 per diluted share, for
    the year ended December 31, 2012.

NON-GAAP

  *Gross margin was 33.1% for the year ended December 31, 2013, compared to
    31.6% for the year ended December 31, 2012.
  *Operating expenses were $141.0 million and earnings from operations were
    $5.0 million for the year ended December 31, 2013, compared to operating
    expenses of $124.7 million and earnings from operations of $0.9 million
    for the year ended December 31, 2012.
  *Adjusted EBITDA was $18.7 million for the year ended December 31, 2013,
    compared to $12.6 million for the year ended December 31, 2012.
  *Net earnings from continuing operations were $6.9 million, or $0.23 per
    diluted share, for the year ended December 31, 2013, compared to a net
    loss of $0.4 million, or $0.01 per diluted share, for the year ended
    December 31, 2012.

Non-GAAP results exclude the impact of stock-based compensation expense,
acquisition costs, gain on sale of the AirCard business, restructuring costs,
integration costs, disposition costs, acquisition amortization, impairment,
foreign exchange gains or losses on foreign currency contracts and translation
of balance sheet accounts, and certain tax adjustments. We disclose non-GAAP
amounts as we believe that these measures provide our shareholders with better
information about actual operating results and assist in comparisons from one
period to another.

Adjusted EBITDA as defined equates to earnings (loss) from operations plus
stock-based compensation expense, acquisition costs, restructuring costs,
integration costs, impairment, and amortization. The reconciliation between
our GAAP and non-GAAP results is provided in the accompanying schedules.

[(1) On April 2, 2013, we completed the sale of substantially all of the
assets and operations related to our AirCard business. The results of
operations and the gain on sale of the AirCard business have been presented as
discontinued operations for the three and twelve months ended December 31,
2013 and December 31, 2012.]

Financial Guidance

The Company provides the following guidance for continuing operations for the
first quarter of 2014.

In the first quarter of 2014 we expect solid year-over-year revenue and
earnings growth. We expect gross margin to decrease slightly from Q4, 2013 due
to a shift in product mix and we expect operating expenses to increase as a
result of higher new product certification costs, investment in sales and
marketing capabilities, and a full quarter of expenses related to the AnyDATA
acquired business.

                           Consolidated
Q1 2014 Guidance         
                           Non-GAAP
                           
Revenue                    $117.0 to $121.0 million
Earnings from operations   $0.5 to $1.5 million
Net earnings               $0.4 to $1.2 million
Earnings per share         $0.01 to $0.04 per share

This non-GAAP guidance for the first quarter of 2014 reflects current business
indicators and expectations. Inherent in this guidance are risk factors that
are described in greater detail in our regulatory filings. Our actual results
could differ materially from those presented above. All figures are
approximations based on management's current beliefs and assumptions.

Conference call, webcast and instant replay details

Sierra Wireless President and CEO, Jason Cohenour, and CFO, David McLennan,
will host a conference call and webcast with analysts and investors to review
the results on Wednesday, February 5, 2014, at 5:30 PM Eastern Time (2:30 PM
PT). A live slide presentation will be available for viewing during the call
from the link provided below.

To participate in this conference call, please dial the following number
approximately ten minutes prior to the commencement of the call:

  *Toll-free (Canada and US): 1-877-201-0168
  *Alternate number: 1-647-788-4901
  *Conference ID: 18174338

For those unable to participate in the live call, a replay will be available
until March 5, 2014. Dial 1-855-859-2056 or 1-800-585-8367 and enter the
Conference ID number above to access the replay.

To access the webcast, please follow the link below:

Sierra Wireless Q4 and Year End 2013 Financial Results Webcast

If the above link does not work, please copy and paste the following URL into
your browser:

http://www.snwebcastcenter.com/webcast/sierrawireless/2013q4/

The webcast will remain available at the above link for one year following the
call.

We look forward to having you participate in our call.

Cautionary Note Regarding Forward-Looking Statements

Certain statements and information in this press release are not based on
historical facts and constitute forward-looking statements or forward-looking
information within the meaning of the U.S. Private Securities Litigation
Reform Act of 1995 and Canadian securities laws (“forward-looking statements”)
including statements and information relating to our financial guidance for
the first quarter of 2014 and our fiscal year 2014, our business outlook for
the short and longer term and our strategy, plans and future operating
performance. Forward-looking statements are provided to help you understand
our views of our short and longer term prospects. We caution you that
forward-looking statements may not be appropriate for other purposes. We will
not update or revise our forward-looking statements unless we are required to
do so by securities laws.

Forward-looking statements:

  *Typically include words and phrases about the future such as “outlook”,
    “may”, “estimates”, “intends”, “believes”, “plans”, “anticipates” and
    “expects”.
  *Are not promises or guarantees of future performance. They represent our
    current views and may change significantly.
  *Are based on a number of material assumptions, including those listed
    below, which could prove to be significantly incorrect:

  *Our ability to develop, manufacture and sell new products and services
    that meet the needs of our customers and gain commercial acceptance;
  *Our ability to continue to sell our products and services in the expected
    quantities at the expected prices and expected times;
  *Expected cost of goods sold;
  *Expected component supply constraints;
  *Our ability to “win” new business;
  *Expected deployment of next generation networks by wireless network
    operators;
  *Our operations are not adversely disrupted by component shortages or other
    development, operating or regulatory risks; and
  *Expected tax rates and foreign exchange rates.

  *Are subject to substantial known and unknown material risks and
    uncertainties. Many factors could cause our actual results, achievements
    and developments in our business to differ significantly from those
    expressed or implied by our forward-looking statements, including without
    limitation, the following factors. These risk factors and others are
    discussed in our Annual Information Form and Management's Discussion and
    Analysis of Financial Condition and Results of Operations, which may be
    found on SEDAR at www.sedar.com and on EDGAR at www.sec.gov and in our
    other regulatory filings with the Securities and Exchange Commission in
    the United States and the Provincial Securities Commissions in Canada.

  *Actual sales volumes or prices for our products and services may be lower
    than we expect for any reason including, without limitation, continuing
    uncertain economic conditions, price and product competition, different
    product mix, the loss of any of our significant customers, or competition
    from new or established wireless communication companies;
  *The cost of products sold may be higher than planned or necessary
    component supplies may not be available, are delayed or are not available
    on commercially reasonable terms;
  *We may be unable to enforce our intellectual property rights or may be
    subject to litigation that has an adverse outcome;
  *The development and timing of the introduction of our new products may be
    later than we expect or may be indefinitely delayed;
  *Transition periods associated with the migration to new technologies may
    be longer than we expect; and
  *We may experience higher than anticipated costs; disruption of, and
    demands on, our ongoing business; diversion of management's time and
    attention; adverse effects on existing business relationships with
    suppliers and customers and employee issues in connection with the
    divestiture of the AirCard assets and operations.

About Sierra Wireless

Sierra Wireless (NASDAQ: SWIR) (TSX: SW) is the global leader in
machine-to-machine (M2M) devices and cloud services, delivering intelligent
wireless solutions that simplify the connected world. We offer the industry's
most comprehensive portfolio of 2G, 3G and 4G embedded modules and gateways,
seamlessly integrated with our secure M2M cloud services. Customers worldwide,
including OEMs, enterprises, and mobile network operators, trust our
innovative solutions to get their connected products and services to market
faster. Sierra Wireless has more than 850 employees globally and has R&D
centers in North America, Europe and Asia. For more information about Sierra
Wireless, visit www.sierrawireless.com.

"AirPrime," "AirLink," and "AirVantage" are trademarks of Sierra Wireless.
Other product or service names mentioned herein may be the trademarks of their
respective owners.

                            SIERRA WIRELESS, INC.

    CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

        (In thousands of U.S. dollars, except where otherwise stated)

                   Three months ended December  Twelve months ended December
                     31,                          31,
                    2013          2012          2013           2012
Revenue              $  118,608     $  109,405    $  441,860      $  397,321
Cost of goods sold     80,165        73,172       296,219        272,047
Gross margin           38,443        36,233       145,641        125,274
                                                                     
Expenses
Sales and               10,693         10,176        42,182          37,067
marketing
Research and            19,074         16,294        73,112          61,785
development
Administration          8,841          7,743         35,164          32,777
Acquisition             369            387           508             3,182
Restructuring           14             42            171             2,251
Integration             —              —             27              —
Amortization           2,999         3,107        12,141         10,418
                      41,990        37,749       163,305        147,480
Loss from               (3,547)        (1,516)       (17,664)        (22,206)
operations
Foreign exchange        1,921          1,608         3,823           3,326
gain
Other income           26            35           (98)           (196)
(expense)
Earnings (loss)
before income           (1,600)        127           (13,939)        (19,076)
taxes
Income tax expense     345           (15,369)     1,611          (14,874)
(recovery)
Net earnings
(loss) from             (1,945)        15,523        (15,550)        (4,202)
continuing
operations
Net earnings from
discontinued           1,078         4,083        70,588         31,401
operations
Net earnings         $  (867)       $  19,606     $  55,038       $  27,199
(loss)
Other
comprehensive
income (loss):
Foreign currency
translation            179            676          604            538
adjustments, net
of taxes of $nil
Comprehensive        $  (688)       $  20,282     $  55,642       $  27,737
income (loss)
Basic and diluted
net earnings
(loss) per share
attributable to
the Company’s
common
shareholders (in
dollars)
Continuing           $  (0.06       $  0.50       $  (0.50)       $  (0.14)
operations
Discontinued           0.03          0.14         2.29           1.02
operations
                     $  (0.03)      $  0.64       $  1.79         $  0.88
Weighted average
number of shares
outstanding (in
thousands)
Basic                   30,804         30,591        30,771          30,788
Diluted                30,804        30,774       30,771         30,788

                            SIERRA WIRELESS, INC.

                         CONSOLIDATED BALANCE SHEETS

                        (In thousands of U.S. dollars)

                                       December 31, 2013  December 31, 2012
Assets                                                     
Current assets
Cash and cash equivalents                $     177,416       $     63,646
Short-term investments                         2,470               —
Accounts receivable, net of allowance
for doubtful accounts of $2,279                112,490             108,624
(December 31, 2012 - $2,435)
Inventories                                    8,253               12,675
Deferred income taxes                          2,391               22,199
Prepaids and other                             28,741              24,252
Assets held for sale                          —                  54,340
                                               331,761             285,736
Property and equipment                         21,982              20,039
Intangible assets                              43,631              56,357
Goodwill                                       102,718             97,961
Deferred income taxes                          7,176               3,880
Other assets                                  4,732              790
                                        $     512,000       $     464,763
                                                                   
Liabilities
Current liabilities
Accounts payable and accrued             $     124,846       $     128,216
liabilities
Deferred revenue and credits                   2,481               1,312
Liabilities held for sale                     —                  10,353
                                               127,327             139,881
Long-term obligations                          21,550              26,526
Deferred income taxes                         127                300
                                             149,004            166,707
Equity
Shareholders’ equity
Common stock: no par value; unlimited
shares authorized; issued and
outstanding 31,097,844 shares                  329,628             322,770
(December 31, 2012 - 30,592,423
shares)
Preferred stock: no par value;
unlimited shares authorized; issued            —                   —
and outstanding: nil shares
Treasury stock: at cost 507,147 shares         (5,137)             (5,172)
(December 31, 2012 – 716,313 shares)
Additional paid-in capital                     25,996              23,203
Retained earnings (deficit)                    19,367              (35,283)
Accumulated other comprehensive loss          (6,858)            (7,462)
                                             362,996            298,056
                                        $     512,000       $     464,763

                            SIERRA WIRELESS, INC.

                    CONSOLIDATED STATEMENTS OF CASH FLOWS

                        (In thousands of U.S. dollars)

                Three months ended December    Twelve months ended December
                  31,                             31,
                 2013           2012            2013           2012
Cash flows
provided by
(used in):
Operating
activities
Net earnings      $  (867)        $  19,606          55,038       $  27,199
Items not
requiring
(providing)
cash
Amortization         7,146           7,795           28,296          28,590
Stock-based          2,177           1,703           9,347           6,713
compensation
Gain on sale of
AirCard              —               —               (94,078)        —
business
Deferred income      (855)           (9,701)         16,339          (13,606)
taxes
Loss (gain) on
disposal of
property,            —               (76)            (10)            107
equipment, and
intangibles
Impairment of
assets related       —               —               1,012           —
to discontinued
operations
Tax benefit
from equity          1,458           71              1,458           71
awards
Other                (1,288)         (1,188)         (2,687)         (2,414)
Taxes paid
related to net       (66)            —               (408)           (4)
settlement of
equity awards
Changes in
non-cash
working capital
Accounts             (17,965)        10,768          10,897          (616)
receivable
Inventories          (696)           1,108           11,908          (4,019)
Prepaid
expenses and         4,616           6,014           (7,254)         (14,543)
other
Accounts
payable and          1,940           (26,540)        (13,139)        10,997
accrued
liabilities
Deferred
revenue and         662            (277)           1,147          (422)
credits
Cash flows
provided by
(used in)           (3,738)        9,283           17,866         38,053
operating
activities
Investing
activities
Purchase of M2M
business of          —               —               —               (55,218)
Sagemcom
Purchase of M2M
business of          (5,196)         —               (5,196)         —
AnyDATA
Additions to
property and         (1,649)         (3,995)         (11,359)        (15,845)
equipment
Proceeds from
sale of
property,            —               83              32              139
equipment, and
intangibles
Increase in
intangible           (542)           (673)           (2,211)         (2,607)
assets
Net proceeds
from sale of         —               —               119,958         —
AirCard
business
Net change in
short-term          2,751          —               (2,470)        9,347
investments
Cash flows
provided by
(used in)           (4,636)        (4,585)         98,754         (64,184)
investing
activities
Financing
activities
Issuance of          3,159           9               8,106           436
common shares
Repurchase of
common shares        —               —               (5,772)         (6,312)
for
cancellation
Purchase of
treasury shares      —               —               (3,433)         (2,489)
for RSU
distribution
Decrease in
other long-term     (49)           (169)           (876)          (1,000)
obligations
Cash flows
provided by
(used in)           3,110          (160)           (1,975)        (9,365)
financing
activities
Effect of
foreign
exchange rate       (540)          (420)           (875)          (2,233)
changes on cash
and cash
equivalents
Cash and cash
equivalents,
increase             (5,804)         4,118           113,770         (37,729)
(decrease) in
the period
Cash and cash
equivalents,        183,220        59,528         63,646          101,375
beginning of
period
Cash and cash
equivalents,      $  177,416      $  63,646       $  177,416      $  63,646
end of period

                            SIERRA WIRELESS,INC.

                 RECONCILIATION OF GAAP AND NON-GAAP RESULTS

(in thousands of U.S. dollars, except where otherwise stated)
               2013                                            2012
                Q4         Q3         Q2          Q1         Q4          Q3         Q2         Q1
                                                                                                        
Gross margin    $ 38,443    $ 37,346    $ 36,474     $ 33,378    $ 36,233     $ 31,086    $ 30,081    $ 27,874
- GAAP
Stock-based      119       117       95         75        61         82        78        83
compensation
Gross margin    $ 38,562   $ 37,463   $ 36,569    $ 33,453   $ 36,294    $ 31,168   $ 30,159   $ 27,957
- Non-GAAP
                                                                                                        
Loss from
operations -    $ (3,547)   $ (3,301)   $ (3,932)    $ (6,884)   $ (1,516)    $ (6,728)   $ (6,558)   $ (7,404)
GAAP
Stock-based       2,177       2,145       2,013        1,655       1,470        1,462       1,403       1,446
compensation
Acquisition       369         139         —            —           387          2,196       599         —
Restructuring     14          14          26           117         42           498         1,531       180
Integration                   —           —            27          —            —           —           —
Impairment of
intangible        —           —           —            280         —            —           —           —
asset
Acquisition
related          3,580     3,405     3,363      3,393     3,338      2,906     2,665     2,981
amortization
Earnings
(loss) from     $ 2,593     $ 2,402     $ 1,470      $ (1,412)   $ 3,721      $ 334       $ (360)     $ (2,797)
operations -
Non-GAAP
Amortization
(excluding
acquisition      3,566     3,468     3,403      3,212     3,293      2,904     2,717     2,833
related
amortization)
Adjusted        $ 6,159    $ 5,870    $ 4,873     $ 1,800    $ 7,014     $ 3,238    $ 2,357    $ 36
EBITDA
                                                                                                        
Net earnings
(loss) from
continuing      $ (1,945)   $ 1,075     $ (6,742)    $ (7,938)   $ 15,523     $ (3,612)   $ (8,868)   $ (7,245)
operations -
GAAP
Stock-based
compensation,
restructuring
and other,
integration,      6,112       5,760       5,393        5,355       5,162        6,885       5,658       4,536
and
acquisition
related
amortization,
net of tax
Unrealized
foreign           (1,970)     (2,457)     (1,359)      1,874       (1,655)      (1,218)     (165)       (101)
exchange loss
(gain)
Income tax       925       (895)     3,754      —         (14,540)   (804)     —         —
adjustments
Net earnings
(loss) from
continuing      $ 3,122    $ 3,483    $ 1,046     $ (709)    $ 4,490     $ 1,251    $ (3,375)  $ (2,810)
operations -
Non-GAAP
                                                                                                        
Net earnings
(loss) from
discontinued    $ 1,078     $ (505)     $ 68,152     $ 1,863     $ 4,083      $ 7,279     $ 12,449    $ 7,590
operations -
GAAP
Stock-based
compensation
and               3           1,402       876          1,733       1,696        233         233         233
disposition
costs
Gain on sale
of AirCard       (1,056)   (49)      (69,077)   —         —          —         —         —
business
Net earnings
(loss) from
discontinued    $ 25       $ 848      $ (49)      $ 3,596    $ 5,779     $ 7,512    $ 12,682   $ 7,823
operations -
Non-GAAP
                                                                                                        
Net earnings    $ (867)     $ 570       $ 61,410     $ (6,075)   $ 19,606     $ 3,667     $ 3,581     $ 345
(loss) - GAAP
Net earnings
(loss) -          3,147       4,331       997          2,887       10,269       8,763       9,307       5,013
Non-GAAP
                                                                                                        
Diluted
earnings
(loss) from
continuing
operations
per share
GAAP - (in      $ (0.06)    $ 0.03      $ (0.22)     $ (0.26)    $ 0.50       $ (0.12)    $ (0.29)    $ (0.23)
dollars)
Non-GAAP -      $ 0.10      $ 0.11      $ 0.03       $ (0.02)    $ 0.15       $ 0.04      $ (0.11)    $ (0.09)
(in dollars)
                                                                                                        
Net earnings
(loss) per
share -
diluted
GAAP - (in      $ (0.03)    $ 0.02      $ 2.00       $ (0.20)    $ 0.64       $ 0.12      $ 0.12      $ 0.01
dollars)
Non-GAAP -      $ 0.10     $ 0.14     $ 0.03      $ 0.09     $ 0.33      $ 0.29     $ 0.30     $ 0.16
(in dollars)

                            SIERRA WIRELESS,INC.

                              SEGMENTED RESULTS

 (In thousands of U.S. dollars)
              2013                                                                              2012 ^ (1)
               Total        Q4           Q3          Q2          Q1           Total        Q4          Q3            Q2          Q1
  OEM
  Solutions
  Revenue      $ 382,016     $ 101,858     $ 95,850     $ 95,076     $ 89,232       $ 346,543     $ 94,874     $ 88,270      $ 83,299     $ 80,100 
  Cost of      266,867     72,336      66,395     65,514     62,622      246,284      66,024     63,172      58,844     58,244    
  goods sold
  Gross        $ 115,149   $ 29,522    $ 29,455   $ 29,562   $ 26,610    $ 100,259    $ 28,850   $ 25,098    $ 24,455   $ 21,856  
  margin
  Gross        30.1      %   29.0      %   30.7     %   31.1     %   29.8     %     28.9      %   30.4     %   28.4       %   29.4     %   27.3       %
  margin %
                                                                                                                                           
  Enterprise
  Solutions
  Revenue      $ 59,844      $ 16,750      $ 16,412     $ 14,513     $ 12,169       $ 50,778      $ 14,531     $ 11,913       $ 12,099     $ 12,235
  Cost of      29,352      7,829       8,521      7,601      5,401       25,763       7,148      5,925       6,473      6,217      
  goods sold
  Gross        $ 30,492    $ 8,921     $ 7,891    $ 6,912    $ 6,768     $ 25,015     $ 7,383    $ 5,988     $ 5,626    $ 6,018    
  margin
  Gross        51.0      %   53.3      %   48.1     %   47.6     %   55.6     %     49.3      %   50.8     %   50.3       %   46.5     %   49.2       %
  margin %

(1) Comparative information has been reclassified to conform to current period
presentation.

Contact:

Sierra Wireless, Inc.
Media Contact:
Sharlene Myers, +1 (604) 232-1445
Manager, Global Public Relations
smyers@sierrawireless.com
or
Investor Contact:
David G. McLennan, +1 (604) 231-1181
Chief Financial Officer
investor@sierrawireless.com
 
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