Release Date: November 26, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Revenue increased by 5.6% year over year to USD25.2 million, indicating growth momentum.
- Net income reached USD3.4 million with a positive net cash inflow from operations of USD2.0 million, showcasing a solid financial position.
- Expansion of the GlocalMe ecosystem into various business lines beyond travel, such as GlocalMe Life, SIM, and IoT, broadening the company's market presence.
- The GlocalMe Life product series made significant progress with new distribution channels and partnerships, potentially creating a promising new revenue stream.
- The ALL SIM solution is under commercial testing and expected to launch soon, offering a unique position in the market by overcoming cross-carrier restrictions.
Negative Points
- Overall gross margin decreased to 48.4% in the third quarter of 2024 from 51.2% in the same period of 2023.
- Gross margins on products decreased significantly to 23.1% from 40.1% in the same period of 2023.
- Operating expenses increased to USD9.7 million, representing 39% of total revenue, up from 36% in the same period of 2023.
- Net income slightly decreased from USD3.5 million in the same period of 2023 to USD3.4 million.
- Operating cash inflow decreased to USD2 million from USD2.8 million in the same period of 2023, indicating reduced cash generation from operations.
Q & A Highlights
Q: Can you provide an update on the ALL SIM solution and its commercial launch milestones?
A: Chaohui Chen, CEO, explained that the ALL SIM solution, also known as eSIM Trio, is set to launch by the end of the quarter. The solution is designed to be the best secondary SIM card, overcoming limitations of primary SIM cards in terms of roaming and data connectivity. It is compatible with OTA SIM, physical SIM, cloud SIM, and eSIM, and can adapt to all handsets, making it a unique offering in the industry.
Q: Your Q4 guidance suggests higher sequential growth compared to previous years. What gives you confidence in achieving this?
A: Yimeng Shi, CFO, noted that new products like the GlocalMe Life series are expected to contribute to Q4 revenues. The company is expanding beyond portable Wi-Fi terminals, and this diversification is expected to drive growth, reflecting their strategy to grow from one business line to four.
Q: Will the sales and marketing expenses seen in Q3 continue at the same level going forward?
A: Yimeng Shi, CFO, stated that they plan to invest more in marketing, particularly in the US, Japan, and Europe, to enhance market exposure for new products like GlocalMe Life and the ALL SIM solutions. They aim to balance financial positions while supporting growth, maintaining gross profit and positive operating cash flow.
Q: Can you provide more details on the partnership with the US airport retail channel and its impact on future product sales?
A: Chaohui Chen, CEO, mentioned that they have signed contracts with major US airport retail channels, with products like Unicord, RoamPlug, and KeyTracker now available in 38 US airports. They plan to expand further into other top-tier channels in the US and Europe, aiming for significant breakthroughs in the coming quarters.
Q: Why did PaaS and SaaS services revenues increase significantly in the third quarter, and is this growth sustainable?
A: Yimeng Shi, CFO, explained that the increase in PaaS/SaaS revenues was due to business partners opting to pay more for platform fees to improve future operational efficiencies. This model allows partners to choose different packages for platform services, indicating a sustainable growth trend.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
