Sign in

You're signed outSign in or to get full access.

ST

SONIM TECHNOLOGIES INC (SONM)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $11.19M, down 33% sequentially due to Q1’s $5.27M one-time revenue addition; GAAP net loss was $(7.48)M and Adjusted EBITDA was $(3.15)M, impacted by impairment and proxy-related costs .
  • Gross margin fell to 8% (from 50% in Q1), driven by $1.08M impairment of contract fulfillment assets and the absence of Q1’s one-time revenue adjustment; EPS was $(0.79) vs $0.08 in Q1 .
  • Strategic catalysts: tier-one carrier launches underway in Q3 for XP Pro and a 5G flip feature phone; debut of MegaConnect HPUE hotspot with FirstNet/AT&T; definitive agreement for Social Mobile to acquire substantially all assets for $15.0M plus up to $5.0M earn-out, expected to close in Q4 2025 .
  • Balance sheet support via capital raises: $5.4M raised in Q2 and $7.1M net proceeds post quarter-end (equity plus debt) to fund launches and working capital .

What Went Well and What Went Wrong

What Went Well

  • Tier-one carrier launch momentum: “Tier-one carrier launches of our XP Pro series and 5G flip feature phone are now underway in the third quarter.” This underpins H2 growth potential .
  • New product and channel wins: Launch of MegaConnect (HPUE mobile hotspot) with FirstNet/AT&T; shipments of H500 to support Deutsche Telekom, Telenor, Swisscom launches; promotional slot for H500 at Verizon .
  • Balance sheet actions: $5.4M net capital raised in Q2 and $7.1M net proceeds post quarter-end to back product expansion and launches .

What Went Wrong

  • Sequential revenue decline: $11.19M vs $16.72M in Q1 (down ~33%), mainly due to lapse of Q1 one-time revenue and timing shifts of shipments .
  • Margin compression and impairment: Gross margin fell to 8% (from 50% in Q1), including $1.08M impairment of contract fulfillment assets related to end-of-life legacy products .
  • Elevated operating costs: Higher G&A and Sales & Marketing due to contested proxy; GAAP net loss $(7.48)M vs Q1 net income $0.46M, highlighting near-term cost headwinds .

Financial Results

Core P&L Comparison

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Millions)$11.52 $16.72 $11.19
Gross Profit ($USD Millions)$2.97 $8.36 $0.85
Operating Expenses ($USD Millions)$9.44 $7.71 $7.58
GAAP Net Income (Loss) ($USD Millions)$(6.62) $0.46 $(7.48)
Diluted EPS ($USD)$(1.41) $0.08 $(0.79)

Stated Margin Metrics (as disclosed)

MetricQ2 2024Q1 2025Q2 2025
Gross Margin (%)—50% 8%

Non-GAAP and Items

  • Adjusted EBITDA ($USD Millions): Q2 2025 $(3.15) ; Q1 2025 $(3.25) .
  • Impairment of contract fulfillment assets ($USD Millions): Q2 2025 $1.08 ; Q2 2024 $3.22 .

KPI Snapshot

KPIQ4 2024Q1 2025Q2 2025
Cash & Cash Equivalents ($USD Millions)$5.34 $2.12 $2.01
Accounts Receivable ($USD Millions)$4.34 $4.85 $2.87
Inventory ($USD Millions)$10.62 $8.62 $9.89
Adjusted EBITDA ($USD Millions)$(16.60) $(3.25) $(3.15)
Weighted Avg. Basic Shares (units)4,718,141 5,839,764 9,510,601

Vs. Estimates

MetricQ2 2025 ActualQ2 2025 Consensus
Revenue ($USD Millions)$11.19 N/A*
Primary EPS ($USD)$(0.79) N/A*

Values marked with * indicate consensus values unavailable; Values retrieved from S&P Global.

Segment Breakdown

  • Not disclosed in the Q2 2025 and Q1 2025 earnings materials; Sonim does not report segments in these releases .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY/Q3 2025Not providedNot providedMaintained (no formal guidance)
Gross MarginFY/Q3 2025Not providedNot providedMaintained (no formal guidance)
Product Launch TimingQ3 2025“Set to launch five products as stocked in Q2” (prior) Tier-one launches of XP Pro and 5G flip underway in Q3; H500 launches in EU carriers; Verizon promo slot Reaffirmed/updated timing
Transaction Timing (Social Mobile)Q4 2025N/AExpected close in Q4 2025 (subject to customary conditions, stockholder approval) New (announced)
OpEx, OI&E, Tax Rate, DividendsFY/Q3 2025Not providedNot providedMaintained (no formal guidance)

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
Product Launches & Tier-One CarriersXP Pro 5G launched with Verizon; multiple hotspots (H500/H700) momentum; set to launch stocked offerings in Q2 XP Pro and 5G flip launches underway in Q3; H500 shipments for DT/Telenor/Swisscom; Verizon promo slot Execution continuing; broadened carrier footprint
European ExpansionExpanded distribution and launches (XP400/XP100), MSAs with distributors H500 shipments to EU distributors to support tier-one operator launches Scaling in EMEA
Supply Chain/Compliance & SecurityTAA-compliant manufacturing focus SBOM and security process reinforced via Binarly integration (April) Improved security and compliance tooling
Financial Discipline & CapitalRaised ATM proceeds and debt; improved liquidity $5.4M equity raised in Q2; $7.1M net proceeds post quarter-end Continued balance sheet bolstering
Legal/Proxy & TransactionHostile takeover risk cited; listing compliance considerations Proxy-related costs elevated; definitive agreement to sell assets to Social Mobile ($15M + up to $5M earn-out) Strategic pivot toward asset sale
Margins & ImpairmentsQ4 GM −1% with asset impairment; Q1 GM 50% aided by one-time revenue Q2 GM 8% with $1.08M impairment; absence of Q1 one-time revenue Normalizing without one-time boosts

Management Commentary

  • CEO: “Tier-one carrier launches of our XP Pro series and 5G flip feature phone are now underway in the third quarter… We also debuted Sonim MegaConnect… we are energized by the overwhelming customer enthusiasm and robust orders… the agreement for Social Mobile to acquire Sonim underscores the value of our innovation and market strategy.” — Peter Liu, CEO .
  • CFO: “Our second quarter results reflect some one-time expenses driven by unique circumstances, including legal fees associated with the proxy battle and due diligence efforts… we remain focused on exploring strategic opportunities to monetize our Nasdaq listing and deliver maximum value to our shareholders.” — Clay Crolius, CFO .

Q&A Highlights

  • No Q2 2025 earnings call transcript was available in our document set; no Q&A themes to report [ListDocuments: earnings-call-transcript returned none].

Estimates Context

  • S&P Global Wall Street consensus appeared unavailable for SONM’s Q2 2025 EPS and Revenue; thus, beat/miss vs consensus cannot be determined.*
  • Given minimal coverage and company-specific one-time items (Q1 expiration of customer allowance agreements; Q2 impairment and proxy-related fees), estimate models may need to adjust for normalization of margins without non-recurring revenue and for the transition to H2 product launch-driven sales .

Values retrieved from S&P Global.

Key Takeaways for Investors

  • Near-term financials were pressured by one-time costs (proxy, impairment) and timing of shipments; sequential revenue decline reflects Q1’s non-recurring $5.27M revenue and Q2 launch timing .
  • H2 setup is improving: tier-one carrier launches (XP Pro, 5G flip) and EU hotspot rollouts provide potential revenue acceleration and mix benefits .
  • Balance sheet liquidity actions (Q2 equity raise; post-Q2 equity/debt proceeds) should support inventory build and launch execution, partially mitigating working capital strain .
  • Margin trajectory should normalize off Q2’s 8% GM as impairments subside and stocked carrier launches scale; monitor mix, channel promotions, and any further legacy EOL charges .
  • Strategic transaction (asset sale to Social Mobile: $15.0M cash + up to $5.0M earn-out) is a key catalyst; closing expected Q4 2025 subject to approvals—track shareholder vote, competing proposals, and any legal developments .
  • Risks: continued listing compliance, concentrated customer base, certification/customization timelines, and macro/trade/tariff exposure—stay alert to update cadence and operator acceptance .
  • Actionable: position for potential event-driven moves around transaction milestones and Q3/Q4 launch updates; reassess valuation with asset-sale proceeds and earnings power under a streamlined product portfolio .