UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549


FORM						10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, ~~2023~~2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 001-38358


			INSEEGO CORP.
			(Exact name of registrant as specified in its charter)


Delaware		81-3377646
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

9710 Scranton Road, Suite 200
San Diego,	California	92121
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (858) 812-3400

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	INSG	Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☒☐
Non-accelerated filer	☐☒	Smaller reporting company	☐☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the registrant’s common stock outstanding as of May 2, 2024~~April 28, 2023,~~, was ~~110,002,427.~~11,882,948.

TABLE OF CONTENTS


		Page
PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements	3

	Condensed Consolidated Balance Sheets (Unaudited)	3

	Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)	4

	~~Condensed Consolidated Statements of Comprehensive Loss (Unaudited)~~	5

	Condensed Consolidated Statements of Stockholders’ Deficit (Unaudited)	65

	Condensed Consolidated Statements of Cash Flows (Unaudited)	76

	Notes to Condensed Consolidated Financial Statements (Unaudited)	87

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1916

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2724

Item 4.	Controls and Procedures	2825

PART II—OTHER INFORMATION

Item 1.	Legal Proceedings	2926

Item 1A.	Risk Factors	2926

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2926

Item 3.	Defaults Upon Senior Securities	2926

Item 4.	Mine Safety Disclosures	2926

Item 5.	Other Information	3026

Item 6.	Exhibits	3127

SIGNATURES		3228

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

INSEEGO CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value and share data)

March 31,
2023

December 31,
2022

March 31,
2024

December 31,
2023

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

8,686

7,143

Accounts receivable, net of allowance for doubtful accounts of $561 and $541, respectively

27,416

25,259

Cash and cash equivalents

Accounts receivable, net of allowance for expected credit losses of $1,060 and $1,113, respectively

Inventories

34,234

37,976

Prepaid expenses and other

9,977

7,978

Total current assets

80,313

78,356

Property, plant and equipment, net of accumulated depreciation of $26,688 and $26,049, respectively

4,692

5,390

Rental assets, net of accumulated depreciation of $6,258 and $5,484, respectively

4,904

4,816

Intangible assets, net of accumulated amortization of $38,447 and $31,629, respectively

39,327

41,383

Property, plant and equipment, net of accumulated depreciation of $29,427 and $28,920, respectively

Rental assets, net of accumulated depreciation of $7,859 and $7,003, respectively

Intangible assets, net of accumulated amortization of $42,770 and $39,987, respectively

Goodwill

21,922

Right-of-use assets

6,122

6,662

Operating lease right-of-use assets

Other assets

448

488

Total assets

157,728

159,017

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

Accounts payable

34,573

29,018

Accrued expenses and other current liabilities

27,109

27,945

Revolving credit facility

Total current liabilities

61,682

56,963

Long-term liabilities:

2025 Notes, net

158,799

158,427

Revolving credit facility, net

3,651

6,919

2025 Notes, net

Operating lease liabilities

Deferred tax liabilities, net

299

323

Other long-term liabilities

6,021

6,503

Total liabilities

230,452

229,135

Commitments and contingencies

Commitments and contingencies (Note 9)

Stockholders’ deficit:

Preferred stock, par value $0.001; 2,000,000 shares authorized:

Series E Preferred stock, par value $0.001; 39,500 shares designated, 25,000 shares issued and outstanding, liquidation preference of $1,000 per share (plus any accrued but unpaid dividends)

—

Common stock, par value $0.001; 150,000,000 shares authorized, 109,371,693 and 108,468,150 shares issued and outstanding, respectively

109

108

Preferred stock, par value $0.001; 2,000,000 shares authorized:

Series E Preferred stock, par value $0.001; 39,500 shares designated, 25,000 shares issued and outstanding as of March 31, 2024 and December 31, 2023 (aggregate liquidation preference of $35,913,326)

Common stock, par value $0.001; 150,000,000 shares authorized, 11,882,844 and 11,878,557 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

Additional paid-in capital

796,981

793,855

Accumulated other comprehensive loss

(6,236)

(6,329)

Accumulated deficit

(863,578)

(857,752)

Total stockholders’ deficit

(72,724)

(70,118)

Total liabilities and stockholders’ deficit

157,728

159,017

See accompanying notes to condensed consolidated financial statements.

INSEEGO CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except share and per share data)

(Unaudited)


		Three Months Ended March 31,				Three Months Ended March 31,
		2023		2022			2024	2023
Net revenues:
IoT & Mobile Solutions		$	43,627	$	54,505
Enterprise SaaS Solutions		7,167		6,879
Total net revenues		50,794		61,384
Cost of net revenues:
IoT & Mobile Solutions		29,662		42,903
Enterprise SaaS Solutions		2,945		3,233
Total cost of net revenues		32,607		46,136
Revenues:
Mobile solutions
Mobile solutions
Mobile solutions
Fixed wireless access solutions
Product revenues
Services and other
Total revenues
Cost of revenues:
Product
Product
Product
Services and other
Total cost of revenues
Gross profit	Gross profit	18,187		15,248
Operating costs and expenses:	Operating costs and expenses:
Research and development	Research and development	8,154		18,560
Research and development
Research and development
Sales and marketing	Sales and marketing	6,646		9,773
General and administrative	General and administrative	6,045		8,238
Amortization of purchased intangible assets		429		444
Depreciation and amortization
Impairment of capitalized software	Impairment of capitalized software	504		—
Total operating costs and expenses	Total operating costs and expenses	21,778		37,015
Operating loss	Operating loss	(3,591)		(21,767)
Other (expense) income:	Other (expense) income:

Loss on debt conversion and extinguishment, net		—		(450)
Interest expense, net
Interest expense, net
Interest expense, net	Interest expense, net	(1,997)		(2,923)
Other (expense) income, net	Other (expense) income, net	795		(405)
Total other expense		(1,202)		(3,778)

Loss before income taxes	Loss before income taxes	(4,793)		(25,545)
Income tax provision (benefit)		311		(322)
Loss before income taxes
Loss before income taxes
Income tax provision
Net loss	Net loss	(5,104)		(25,223)

Series E preferred stock dividends	Series E preferred stock dividends	(723)		(661)
Net loss attributable to common stockholders	Net loss attributable to common stockholders	$	(5,827)	$	(25,884)
Per share data:	Per share data:
Net loss per common share:	Net loss per common share:
Basic and diluted		$	(0.05)	$	(0.24)
Net loss per common share:
Net loss per common share:
Basic and diluted (*)
Basic and diluted (*)
Basic and diluted (*)
Weighted-average shares used in computation of net loss per common share:	Weighted-average shares used in computation of net loss per common share:
Basic and diluted		108,601,894		105,649,419
Basic and diluted (*)
Basic and diluted (*)
Basic and diluted (*)

Other comprehensive income:
Other comprehensive income:
Other comprehensive income:
Foreign currency translation adjustment
Foreign currency translation adjustment
Foreign currency translation adjustment
Comprehensive loss

(*) Adjusted retroactively for reverse stock split that occurred on January 24, 2024, see Note 1

See accompanying notes to condensed consolidated financial statements.

~~INSEEGO CORP.~~

~~CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS~~

~~(In thousands)~~

~~(Unaudited)~~

Three Months Ended
March 31,
2023 2022
Net loss $ (5,104) $ (25,223)
Foreign currency translation adjustment 94 2,898
Total comprehensive loss $ (5,010) $ (22,325)

~~See accompanying notes to condensed consolidated financial statements.~~

INSEEGO CORP.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

(In thousands)

(Unaudited)

Preferred Stock Common Stock Additional
Paid-in Capital
Accumulated Deficit 1
Accumulated
Other
Comprehensive Income (Loss) 1
Total
Stockholders’ Equity (Deficit)
Shares Amount Shares Amount
Balance, December 31, 2021 25 $ — 105,381 $ 105 $ 770,619 (787,047) $ (8,531) $ (24,854)
Net loss — — — — — (25,223) — (25,223)
Foreign currency translation adjustment — — — — — — 2,898 2,898
Adjustment relating to extinguishment of 2022 Notes — — — — 1,728 — —�� 1,728
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan — — 2,008 2 74 — — 76
Taxes withheld on net settled vesting of restricted stock units — — — — (14) — — (14)
Share-based compensation — — — — 11,199 — — 11,199
Series E preferred stock dividends — — — — 661 (661) — —
Balance, March 31, 2022 25 $ — 107,389 $ 107 $ 784,267 $ (812,931) $ (5,633) $ (34,190)
Balance, December 31, 2022 25 $ — 108,468 $ 108 $ 793,855 $ (857,752) $ (6,329) $ (70,118)
Net loss — — — — — (5,104) — (5,104)
Foreign currency translation adjustment — — — — — — 94 94
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan — — 46 — 96 — — 96
Taxes withheld on net settled vesting of restricted stock units — — — — (21) — — (21)
Issuance of common shares in connection with a public offering, net of issuance costs 858 1 528 529
Share-based compensation — — — — 1,800 — — 1,800
Series E preferred stock dividends — — — — 723 (723) — —
Balance, March 31, 2023 25 $ — 109,372 $ 109 $ 796,981 $ (863,578) $ (6,236) $ (72,724)


	Preferred Stock			Common Stock			Additional Paid-in Capital (*)		Accumulated Deficit		Accumulated Other Comprehensive (Loss) Income		Total Stockholders’ Deficit
	Shares	Amount		Shares (*)	Amount (*)
Balance, December 31, 2022	25	$	—	10,847	$	11	$	793,952	(857,751)		$	(6,329)	$	(70,117)
Net loss	—	—		—	—		—		(5,104)		—		(5,104)
Foreign currency translation adjustment	—	—		—	—		—		—		94		94
Vesting of restricted stock units and stock issued under employee stock purchase plan, net of taxes withheld	—	—		4	—		75		—		—		75
Issuance of common shares in connection with a public offering, net of issuance costs				86			529						529
Share-based compensation	—	—		—	—		1,800		—		—		1,800
Series E preferred stock dividends	—	—		—	—		723		(723)		—		—
Balance, March 31, 2023	25	$	—	10,937	$	11	$	797,079	$	(863,578)	$	(6,235)	$	(72,723)

Balance, December 31, 2023	25	$	—	11,879	$	12	$	810,138	$	(906,928)	$	(5,327)	$	(102,105)
Net loss	—	—		—	—		—		(4,455)		—		(4,455)
Foreign currency translation adjustment	—	—		—	—		—		—		262		262
Vesting of restricted stock units and stock issued under employee stock purchase plan, net of taxes withheld	—	—		4	—		(8)		—		—		(8)

Share-based compensation	—	—		—	—		717		—		—		717
Series E preferred stock dividends	—	—		—	—		790		(790)		—		—
Balance, March 31, 2024	25	$	—	11,883	$	12	$	811,637	$	(912,173)	$	(5,065)	$	(105,589)

(*) Adjusted retroactively for reverse stock split that occurred on January 24, 2024, see Note 1 ~~Rounding may impact summation of amounts.~~

See accompanying notes to condensed consolidated financial statements.

INSEEGO CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


		Three Months Ended March 31,
	Three Months Ended March 31,							Three Months Ended March 31,
		2023		2022		2024	2023
Cash flows from operating activities:	Cash flows from operating activities:
Net loss	Net loss	$	(5,104)	$	(25,223)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Net loss
Net loss
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	Depreciation and amortization	5,430		7,243
Provision for bad debts		41		(14)
Depreciation and amortization
Depreciation and amortization
Provision for expected credit losses
Impairment of capitalized software	Impairment of capitalized software	504		—
Provision for excess and obsolete inventory	Provision for excess and obsolete inventory	217		247

Share-based compensation expense
Share-based compensation expense
Share-based compensation expense	Share-based compensation expense	1,800		11,199
Amortization of debt discount and debt issuance costs	Amortization of debt discount and debt issuance costs	489		1,650
Fair value adjustment on derivative instrument		—		(609)
Loss on debt conversion and extinguishment, net		—		450

Deferred income taxes	Deferred income taxes	101		189
Right-of-use assets		592		342

Changes in assets and liabilities, net of effects of divestiture:
Deferred income taxes

Deferred income taxes
Non-cash operating lease expense

Changes in assets and liabilities:
Changes in assets and liabilities:
Changes in assets and liabilities:
Accounts receivable
Accounts receivable
Accounts receivable	Accounts receivable	(1,997)		5,477
Inventories	Inventories	3,097		(355)
Prepaid expenses and other assets	Prepaid expenses and other assets	(1,940)		2,701
Accounts payable	Accounts payable	5,544		(10,400)
Accrued expenses, income taxes, and other		(490)		6,819
Accrued expenses and other liabilities
Operating lease liabilities	Operating lease liabilities	(625)		(354)
Net cash provided by (used in) operating activities		7,659		(638)
Net cash provided by operating activities
Cash flows from investing activities:	Cash flows from investing activities:

Purchases of property, plant and equipment
Purchases of property, plant and equipment
Purchases of property, plant and equipment	Purchases of property, plant and equipment	(61)		(763)

Additions to capitalized software development costs		(2,443)		(3,127)
Additions to capitalized software development costs and purchases of intangible assets
Additions to capitalized software development costs and purchases of intangible assets
Additions to capitalized software development costs and purchases of intangible assets
Net cash used in investing activities	Net cash used in investing activities	(2,504)		(3,890)
Cash flows from financing activities:	Cash flows from financing activities:
Net (repayment) borrowing of bank and overdraft facilities		—		(54)

Principal payments under finance lease obligations

Principal payments under finance lease obligations

Principal payments under finance lease obligations	Principal payments under finance lease obligations	(199)		(62)
Proceeds from a public offering, net of issuance costs	Proceeds from a public offering, net of issuance costs	529		—
Principal payments on financed assets	Principal payments on financed assets	(360)		(1,007)
Borrowings (repayments) on revolving credit facility		(3,385)		—
Net borrowings (repayments) on revolving credit facility
Proceeds from ESPP
Net cash provided by (used in) financing activities
Effect of exchange rates on cash
Net increase in cash and cash equivalents
Cash and cash equivalents, beginning of period
Cash and cash equivalents, end of period

Proceeds from stock option exercises and employee stock purchase plan, net of taxes paid on vested restricted stock units		75		63
Net cash used in financing activities		(3,340)		(1,060)
Effect of exchange rates on cash		(272)		957
Net increase (decrease) in cash, cash equivalents and restricted cash		1,543		(4,631)
Cash, cash equivalents and restricted cash, beginning of period		7,143		49,812
Cash, cash equivalents and restricted cash, end of period		$	8,686	$	45,181
Supplemental disclosures of cash flow information:
Supplemental disclosures of cash flow information:
Supplemental disclosures of cash flow information:	Supplemental disclosures of cash flow information:
Cash paid during the year for:	Cash paid during the year for:
Cash paid during the year for:
Cash paid during the year for:
Interest
Interest
Interest	Interest	$	117	$	—
Income taxes	Income taxes	$	59	$	41

Supplemental disclosures of non-cash activities:
Supplemental disclosures of non-cash investing and financing activities:
Supplemental disclosures of non-cash investing and financing activities:
Supplemental disclosures of non-cash investing and financing activities:
Transfer of inventories to rental assets
Transfer of inventories to rental assets
Transfer of inventories to rental assets	Transfer of inventories to rental assets	$	—	$	225
Capital expenditures financed through accounts payable or accrued liabilities	Capital expenditures financed through accounts payable or accrued liabilities	$	2,164	$	2,105
Right-of-use assets obtained in exchange for operating leases liabilities	Right-of-use assets obtained in exchange for operating leases liabilities	$	50	$	79

See accompanying notes to condensed consolidated financial statements.

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note 1. Nature of Business and Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying unaudited condensed consolidated financial statements ~~contained herein~~(“Financial Statements”) have been prepared by Inseego Corp. (the “Company”, “we”, “us”) ~~pursuant to~~in accordance with accounting principles generally accepted in the U.S. (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission ~~(the “SEC”~~(“SEC”)~~. Certain information~~ regarding interim financial reporting. The Financial Statements include the accounts of the Company and ~~note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles~~its consolidated subsidiaries. All significant intercompany balances and transactions have been ~~condensed or omitted pursuant to SEC rules and regulations, although~~eliminated in consolidation. These Financial Statements should be read in conjunction with the ~~Company believes that the disclosures made are adequate to make the information not misleading. Accordingly, the condensed~~audited consolidated financial statements ~~reflect all normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the results of interim periods~~ and ~~may not include all disclosures required by accounting principles generally accepted in the United States (“GAAP”). The information~~notes as of ~~March 31, 2023,~~ and for the ~~three months~~year ended ~~March~~December 31, 2023, ~~and March~~included in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2022, is unaudited, whereas the~~2023 (the “Form 10-K”).

The condensed consolidated balance sheet as of December 31, ~~2022, is~~2023 was derived from the ~~Company’s~~ audited consolidated financial statements as of that ~~date. These condensed consolidated financial statements and notes hereto should be read in conjunction with~~date, but does not include all disclosures required by GAAP. In management’s opinion, the ~~consolidated financial statements and notes thereto included in~~accompanying Financial Statements reflect all normal recurring adjustments necessary for their fair presentation. Other than described below, there have been no changes to the Company’s ~~latest shareholders’ annual report (“Form 10-K”).~~

~~The~~significant accounting policies ~~used in preparing these condensed consolidated financial statements are the same as those~~ described in the Form ~~10-K.~~10-K that have had a material impact on the Company’s Financial Statements. The results of operations for the interim periods presented are not necessarily indicative of results to be expected for any other interim period or for the year as a whole.

~~Principles of Consolidation~~

~~The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.~~

Segment Information

The Company has one reportable segment. The ~~Chief Executive Officer,~~principal executive officer, who is also the Chief Operating Decision Maker, does not manage any part of the Company separately, and the allocation of resources and assessment of performance are based solely on the Company’s consolidated operations and financial results.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent liabilities. Actual results could differ materially from these estimates. Estimates are assessed each period and updated to reflect current information. Significant estimates include revenue recognition, warranty provision, capitalized software costs, allowance for credit losses, provision for excess and obsolete inventory, accrued liabilities related to our contract manufacturers, valuation of tangible and intangible long-lived assets, valuation of goodwill, valuation of derivatives, accruals relating to litigation, income taxes and share-based compensation expense.

~~Risks and Uncertainties~~Reclassifications

~~We may be affected by various macroeconomic factors and~~Certain amounts recorded in the prior period consolidated financial statements have been reclassified to conform to the current period financial statement presentation. These reclassifications had no effect on previously reported operating results.

During the fourth quarter of 2023, and ~~future conditions~~as noted in the ~~global financial markets.~~Form 10-K, the Company reclassified revenue on its Consolidated Statement of Operations. Historically, the Company classified revenues from products and services into two categories, IoT & Mobile Solutions and Enterprise SaaS Solutions. The ~~global credit~~Company is now classifying revenues from products and ~~financial markets have recently experienced extreme volatility~~services into the following two categories: Product Revenue, which consists of our Mobile Solutions and ~~disruptions, including severely diminished liquidity~~Fixed Wireless Access Solutions, and ~~credit availability, declines in consumer confidence, declines in economic growth, rising interest rates, inflation, increases in unemployment rates~~Services and ~~uncertainty about economic stability. The inflationary pressures impacting~~Other. Additionally, during 2023 the ~~global supply chain could potentially increase the cost of net revenues~~Company reclassified all depreciation and amortization expense previously recorded in the operating expense line items of research and development, sales and marketing, and general and administrative expenses on the Consolidated Statement of Operations into a separate line labeled Depreciation and amortization. All prior periods have been reclassified to conform to the current period presentation for these changes.

Reverse Stock Split

On January 24, 2024, the Company completed a 1-for-10 reverse stock split of its issued and ~~future years.~~outstanding common stock (the “Reverse Stock Split”). As a result of the Reverse Stock Split, each share of common stock issued and outstanding immediately prior to January 24th were automatically converted into one-tenth (1/10) of a share of common stock. The ~~ongoing inflation challenges could adversely impact future revenues, gross margins~~Reverse Stock Split affected all common stockholders uniformly and ~~financial results.~~

~~In addition,~~did not alter any stockholder's percentage interest in the ~~COVID-19 pandemic continues~~Company's equity, except to ~~impact worldwide economic activity. A pandemic, including COVID-19 or other public health epidemic, poses~~ the ~~risk~~extent that the Company or its employees, manufacturers, suppliers and other partners may be prevented from conducting business activities for an indefinite period of time, including due to spread of the disease within these groups or due to shutdowns that may be requested or mandated by governmental authorities. The COVID-19 pandemic and mitigation measures have also had an adverse impact on global economic conditions which could have an adverse effect on the Company’s business and financial condition. The extent to which the COVID-19 pandemic, or any other outbreak of an epidemic disease, impacts the Company’s results will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of the virus and the actions to contain its impact.

~~Furthermore,~~Reverse Stock Split would result in a global semiconductor supply shortage continues to have wide-ranging impacts across the technology industry. While the shortage has not materially impacted the Company’s operations and financial results, it may negativelystockholder owning a fractional share. No

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

~~impact~~fractional shares were issued in connection with the ~~Company’s customers and~~Reverse Stock Split. Stockholders who otherwise would be entitled to receive a fractional share instead were entitled to receive cash in lieu of such fractional share.

The Reverse Stock Split did not change the ~~supply of materials needed for testing and production timeline. The Company’s suppliers, contract manufacturers, and customers are all taking actions to reduce the impact~~par value of the ~~semiconductor shortage; however, if~~common stock or the ~~shortage persists,~~authorized number of shares of common stock. All outstanding convertible notes entitling their holders to purchase or obtain or convert into shares of our common stock were adjusted, as required by the ~~impact on operations~~terms of these securities.

All common share and ~~financial results could be material.~~

~~The inflationary pressures impacting~~per-share amounts in this Form 10-Q have been retroactively restated to reflect the ~~global supply chain could potentially increase our future cost~~effect of ~~net revenues. The ongoing inflation challenges could adversely impact our future revenues, gross margins and financial results.~~the Reverse Stock Split.

Liquidity

As of March 31, ~~2023,~~2024, the Company had available cash and cash equivalents totaling ~~$8.7~~$12.3 million and ~~$11.8 million~~working capital of ~~excess availability under its secured asset-backed revolving credit facility. See~~$3.6 million. The Company’s Credit Facility (as defined in Note 4 ~~Debt~~– Debt), ~~for more information on this credit facility.~~which had an outstanding balance of $4.7 million as of March 31, 2024, was voluntarily paid-off and terminated by the Company effective April 18, 2024.

The Company generated positive cash flow from operations both for the year ended December 31, 2023 and in the three months ended March 31, 2024. In April 2024, the Company received a $15.0 million upfront payment from a customer in connection with a two-year service contract. Based on the factors above, and to reduce financing costs, the Company voluntarily paid-off and terminated the Credit Facility effective April 18, 2024. These factors have had a positive impact on our liquidity.

The Company’s 3.25% convertible senior notes due in May 2025 (the “2025 Notes”) have a principal balance of $161.9 million and matures on May 1, 2025. The Company’s intention is to restructure or refinance the 2025 Notes, and the Company is in active negotiations to do so, however there can be no assurance that any required or desired restructuring or financing will be available on terms favorable to the Company, or at all. As the refinancing of the 2025 Notes cannot be assured, accounting guidance requires disclosure that this raises substantial doubt about the Company’s ability to continue as a going concern within one year of the issuance of these financial statements.

While the Company’s liquidity has had several positive developments recently, as noted above, the Company has a history of operating and net losses and overall usage of cash from operating and investing activities. The Company’s management believes that its cash and cash equivalents on-hand, together with anticipated cash flows from operations, availability under its secured asset-backed revolving credit facility, and anticipated savings from ongoing cost reduction efforts, will be sufficient to meet its cash flow needs for the next twelve months from the filing date of this report. To the extent that additional liquidity may be needed, the Company may issue up to $9 million in equivalent shares of the Company’s common stock available, pursuant to a shelf-registration statement filed with the SEC on May 7, 2020 and amended from time to time. The Company’s ability to attain ~~more~~ profitable operations and continue to generate positive cash ~~flow~~flows is dependent upon achieving a level and mix of revenues adequate to support its evolving cost structure. IfIn order to effect a restructuring or refinancing of the 2025 Notes, or if events or circumstances occur such that the Company does not meet its operating plan as expected, or if the Company becomes obligated to pay unforeseen expenditures as a result of ~~ongoing~~potential litigation or otherwise, the Company may be required to raise capital, reduce planned research and development activities, incur additional restructuring charges or reduce other operating expenses and capital expenditures, which could have an adverse impact on the Company’s ability to achieve its intended business objectives.

~~The Company’s liquidity could also be impaired by significant interruptions in its business operations, such as those described above under~~

Note 2. Financial Statement Details

Inventories

Inventories consist of the ~~heading~~ ~~Risks and Uncertainties~~, or, a material failure to satisfy its contractual commitments or a failure to generate revenues from new or existing products. In addition, there can be no assurance that any required or desired restructuring or financing will be available on terms favorable to the Company, or at all.following (in thousands):

~~Cash and Cash Equivalents~~

Cash and cash equivalents include highly liquid investments with original maturities of three months or less. The Company’s cash and cash equivalents are generally held with large financial institutions worldwide to reduce the amount of exposure to credit risk. Cash and cash equivalents are recorded at market value, which approximates cost. Gains and losses associated with the Company’s foreign currency denominated demand deposits are recorded as a component of other income, net, in the consolidated statements of operations. There are no cash equivalents as of December 31, 2022 and as of March 31, 2023. Restricted cash held in escrow as of December 31, 2021 was released during the third quarter of 2022 and we no longer have any restricted cash on our balance sheet as of March 31, 2023. Restricted cash as of March 31, 2022 was $3.7 million.

~~Recently Adopted Accounting Pronouncements~~

~~In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06,~~ Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40)-Accounting For Convertible Instruments and Contracts in an Entity's Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU also simplifies the diluted net income per share calculation in certain areas. The guidance is effective for annual and interim periods beginning after December 15, 2021. The Company adopted the ASU in the first quarter of fiscal 2022 and there was no impact to the condensed consolidated financial statements.

~~In May 2021, the FASB issued ASU 2021-04,~~ Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40). The ASU addresses issuer’s accounting for certain modifications or exchanges of freestanding equity-classified written call options. The ASU is effective for annual and interim periods beginning after December 15, 2021.


	March 31, 2024		December 31, 2023
Finished goods	$	18,705	$	21,264
Raw materials and components	2,092		1,616
Total inventories	$	20,797	$	22,880

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

~~The Company adopted the ASU in the first quarter of fiscal 2022 and there was no impact to the condensed consolidated financial statements.~~

~~In September 2022, the FASB issued ASU No. 2022-04,~~ ~~Liabilities—Supplier Finance Programs (Subtopic 405-50)~~. The ASU requires disclosure of the key terms of outstanding supplier finance programs and a rollforward of the related obligations. The ASU does not affect the recognition, measurement or financial statement presentation of supplier finance program obligations. The ASU is effective for annual and interim periods beginning after December 15, 2022, except for the rollforward requirement, which is effective for annual periods beginning after December 15, 2023. The Company adopted the ASU in the first quarter of 2023, and there was no impact to the consolidated financial statements.

~~2. Financial Statement Details~~

~~Inventories~~

~~Inventories consist of the following (in thousands):~~

March 31,
2023 December 31,
2022
Finished goods $ 26,839 $ 31,153
Raw materials and components 7,395 6,823
Total inventories $ 34,234 $ 37,976

Prepaid expenses and other

Prepaid expenses and other consists of the following (in ~~thousands:~~thousands):

March 31, 2023 1
December 31,
2022
Rebate receivables $ 1,905 $ 2,038
Receivables from contract manufacturers 4,014 3,561
Software licenses 1,079 772
Insurance 11 12
Deposits 619 829
Financed assets 1,355 —
Other 993 766
Total prepaid expenses and other $ 9,977 $ 7,978
~~Rounding may impact summation of amounts.~~

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~


	March 31, 2024		December 31, 2023

Rebate receivables	$	2,884	$	1,950
Receivables from contract manufacturers	2,100		1,823




Other	1,542		1,438
Total prepaid expenses and other	$	6,526	$	5,211

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities consist of the following (in thousands):

March 31,
2023 December 31,
2022
Royalties $ 813 $ 992
Payroll and related expenses 8,510 8,873
Warranty obligations 480 480
Professional fees 611 738
Accrued interest 2,401 1,112
Deferred revenue 4,887 5,060
Customer advances — 2,828
Operating lease liabilities 1,814 1,759
Accrued contract manufacturing liabilities 816 1,416
Liabilities related to financed assets 1,018 —
Value added tax payables 630 449
Other 5,129 4,238
Total accrued expenses and other current liabilities $ 27,109 $ 27,945


	March 31, 2024		December 31, 2023
Royalties	$	852	$	845
Payroll and related expenses	5,490		4,159
Warranty obligations	780		480

Accrued interest	2,555		1,038
Deferred revenue	6,562		5,583

Operating lease liabilities	1,684		1,681
Accrued contract manufacturing liabilities	7,077		7,537


Other	5,805		5,699
Total accrued expenses and other current liabilities	$	30,805	$	27,022

Note 3. Fair Value ~~Measurement of Assets and Liabilities~~

Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. Each fair value measurement is classified into one of the following levels based on the information used in the valuation:Measurements

~~Level 1:~~ ~~Observable inputs such as quoted prices in active markets.~~

~~Level 2:~~ ~~Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.~~

~~Level 3:~~ The fair market value for level 3 securities may be highly sensitive to the use of unobservable inputs and subjective assumptions. Generally, changes in significant unobservable inputs may result in significantly lower or higher fair value measurements.

The Company’s only financial ~~instruments~~instrument measured at fair value ~~were $0 and less than $0.1 million~~on a recurring basis is its interest make-whole payment derivative liability on its 2025 Notes (see Note 4 – Debt). The fair value of that liability was zero as of both March 31, ~~2023~~2024 and December 31, ~~2022 respectively.~~2023.

The fair value of the interest make-whole payment derivative liability was determined using a Monte Carlo model using the following key assumptions:

March 31, 2023

December 31, 2022

March 31, 2024

Volatility

Stock price

$0.58 per share

$0.84 per share

Stock price

Credit spread

32.49

56.52

Term

2.09 years

2.34 years

Term

Dividend yield

—

Risk-free rate

4.04

4.35

Risk-free rate

There was no change in the fair value of the interest make-whole liability for the three months ended March 31, ~~2023. For the three months ended~~2024 or March 31, ~~2023 and 2022, the Company recorded $— and a $0.6 million gain, respectively as a result of the change in the fair value of the interest make-whole liability.~~

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

The Company reviews the fair value hierarchy classification of its financial instruments measured at fair value each reporting period. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. There have been no transfers of assets or liabilities between fair value measurement classifications during the three months ended March 31, 2023 or 2022.2023.

Other Financial Instruments

The carrying values of the Company’s other financial assets and liabilities approximate their fair values because of their short-term nature, with the exception of the ~~3.5% convertible senior notes due~~ 2025 ~~(the “2025 Notes”).~~Notes. The 2025 Notes are carried at amortized cost, adjusted for changes in the fair value of the embedded derivative.

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note 4. Debt

2025 Notes

~~On May 12,~~In 2020, the Company completed ~~its~~both a registered public offering ~~of $100.0 million aggregate principal amount of 2025 Notes~~ and ~~issued $80.4 million principal amount of 2025 Notes in the~~a privately negotiated exchange ~~agreements~~agreement that ~~closed concurrently with~~resulted in the ~~registered offering in May 2020. During the year ended 2021, certain holders~~issuance of the 2025 ~~Notes converted an aggregate of approximately $5.0 million~~Notes. After taking into account exchanges and redemptions occurring in prior periods, the outstanding principal ~~amount~~balance of the 2025 notes was $161.9 million as of both March 31, 2024 and December 31, 2023.

The 2025 Notes ~~into 428,669 shares of~~were issued under an indenture, dated May 12, 2020 (the “Base Indenture”), between the ~~Company’s common stock, including 32,221 shares of common stock issued in satisfaction of~~Company and Wilmington Trust, National Association, as trustee (the “Trustee”), as supplemented by the ~~interest make-whole payment.~~first supplemental indenture, dated May 12, 2020 (the “Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), between the Company and the Trustee.

The 2025 Notes will mature on May 1, 2025, unless earlier repurchased, redeemed or converted. The 2025 Notes are senior unsecured obligations of the Company and bear interest at an annual rate of 3.25%, payable semi-annually in arrears on May 1 and November 1 of each year.

Holders of the 2025 Notes may convert the 2025 Notes into shares of the Company’s common stock (together with cash in lieu of any fractional share), at their option, at any time until the close of business on the scheduled trading day immediately before the maturity date. Upon conversion of the 2025 Notes, the Company will deliver for each $1,000 principal amount of 2025 Notes converted a number of shares of the Company’s common stock (together with cash in lieu of any fractional share), equal to the conversion rate.

As of March 31, ~~2023~~2024, the conversion rate for the 2025 Notes is 7.92896 shares of common stock per $1,000 principal amount of 2025 Notes, which represents a conversion price of approximately $126.12 per share, and ~~December 31, 2022, $161.9 million~~is subject to adjustment upon the occurrence of certain events, including, but not limited to, certain stock dividends, splits and combinations, the issuance of certain rights, options or warrants to holders of the common stock, certain distributions of assets, debt securities, capital stock or other property to holders of the common stock, cash dividends on the common stock and certain Company tender or exchange offers.

If a fundamental change (as defined in the Indenture) occurs at any time prior to the maturity date, then the noteholders may require the Company to repurchase their 2025 Notes at a cash repurchase price equal to the principal amount of the 2025 Notes ~~were~~to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date.If a make-whole fundamental change (as defined in the Indenture) occurs, then the Company will in certain circumstances increase the conversion rate for a specified period of time.

The 2025 Notes will be redeemable, in whole or in part, at the Company’s option at any time, and from time to time, on or after May 6, 2023 through the last scheduled trading day before the maturity date, at a cash redemption price equal to the principal amount of the 2025 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, as long as the last reported sale price per share of the common stock exceeds 130% of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (ii) the trading day immediately before the date the Company sends such notice.

The Indenture contains customary events of default. If an event of default (other than certain events of bankruptcy, insolvency or reorganization involving the Company) occurs and is continuing, the Trustee, by notice to the Company, or the holders of the 2025 Notes representing at least 25% in aggregate principal amount of the outstanding 2025 Notes, by notice to the Company and the Trustee, may declare 100% of the principal of, and all accrued and unpaid interest on, all of the then outstanding 2025 Notes to be due and payable immediately. Upon the occurrence of certain events of bankruptcy, insolvency or reorganization involving the Company, 100% of the principal of, and all accrued and unpaid interest on, all of the then outstanding 2025 Notes will automatically become immediately due and payable. Notwithstanding the foregoing, the Indenture provides that, to the extent the Company elects, the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture will, for the first 360 days after such event of default, consist exclusively of the right to receive additional interest on the 2025 Notes.

Interest make-whole payment

The 2025 Notes also include an interest make-whole payment feature whereby if the last reported sale price of the Company’s common stock for each of the five trading days immediately preceding a conversion date is greater than or equal to $105.10, the Company will, in addition to the other consideration payable or deliverable in connection with such conversion,

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

make an interest make-whole payment to the converting holder equal to the sum of the present values of the scheduled payments of interest that would have been made on the 2025 Notes to be converted had such notes remained outstanding from the conversion date through the earlier of (i) the date that is three years after the conversion date and (ii) the maturity date. The present values will be computed using a discount rate equal to 1%. The Company will satisfy its obligation to pay the interest make-whole payment, at its election, in cash or shares of common stock (together with cash in lieu of fractional shares).The Company has determined that this feature is an embedded derivative and has recognized the fair value of this derivative as a liability in the consolidated balance sheets, with subsequent changes to fair value to be recorded at each reporting period on the consolidated statement of operations in other income, net. See Note 3 – Fair Value Measurements, for more information on this derivative liability.

As of March 31, 2024 and December 31, 2023, $161.9 million of principal amount of the 2025 Notes was outstanding, $80.4 million of which were held by related parties. As of March 31, 2023 and December 31, 2022, accrued interest due of $1.3 million and $0.9 million, respectively, was included within accrued expenses and other current liabilities on the condensed consolidated balance sheets. Assuming no repurchases or conversions of the 2025 Notes prior to May 1, 2025, the entire principal balance of $161.9 million is due on May 1, 2025.

The 2025 Notes consist of the following (in thousands):


		March 31, 2023		December 31, 2022
		March 31, 2024
		March 31, 2024
		March 31, 2024
Principal
Principal
Principal	Principal	$	161,898	$	161,898
Add: fair value of embedded derivative	Add: fair value of embedded derivative	—		$	—
Add: fair value of embedded derivative
Add: fair value of embedded derivative
Less: unamortized debt discount
Less: unamortized debt discount
Less: unamortized debt discount	Less: unamortized debt discount	(1,725)		$	(1,933)
Less: unamortized issuance costs	Less: unamortized issuance costs	(1,374)		$	(1,538)
Less: unamortized issuance costs
Less: unamortized issuance costs
Net carrying amount	Net carrying amount	$	158,799	$	158,427
Net carrying amount
Net carrying amount

The effective interest rate onof the liability component of the 2025 Notes was 4.17% and 4.23% for ~~both~~ the three months ended March 31, ~~2023~~2024 and ~~2022,~~2023, respectively.

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

The following table sets forth total interest expense recognized related to the 2025 Notes (in thousands):


		Three Months Ended March 31,
		Three Months Ended March 31,
		Three Months Ended March 31,
		Three Months Ended March 31,
		2024

		2024
		2023		2022
		2024
Contractual interest expense
Contractual interest expense
Contractual interest expense	Contractual interest expense	$	1,315	$	1,315
Amortization of debt discount	Amortization of debt discount	$	207	$	207
Amortization of debt discount
Amortization of debt discount
Amortization of debt issuance costs
Amortization of debt issuance costs
Amortization of debt issuance costs	Amortization of debt issuance costs	$	165	$	165
Total interest expense	Total interest expense	$	1,687	$	1,687
Total interest expense
Total interest expense

The contractual interest expense on the 2025 Notes recorded within interest expense, net on the consolidated statements of operations attributable to related parties was $0.7 million in the three months ended March 31, 2024 and 2023. As of March 31, 2024 and December 31, 2023, accrued interest due to related parties of $1.1 million and $0.4 million, respectively, was included within accrued expenses and other current liabilities on the condensed consolidated balance sheets.

Asset-backed Revolving Credit Facility

OnIn August 5, 2022, the Company entered into a Loan and Security Agreement ~~(the~~(as subsequently amended, the “Credit Agreement”), by and among Siena Lending Group LLC, as lender (“Lender”), Inseego Wireless, Inc., a Delaware corporation (“Inseego Wireless”), a subsidiary of the Company, and Inseego North America LLC, an Oregon limited liability company and indirect subsidiary of the Company, as borrowers (together with Inseego Wireless, the “Borrowers”), and the Company, as guarantor (together with the Borrowers, the “Loan Parties”). Effective April 18, 2024, the Company exercised its right to voluntarily pay-off and terminate the Credit Agreement. See Note 11 – Subsequent Events for more information on the termination of the Credit Agreement.

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The Credit Agreement ~~establishes~~established a secured asset-backed revolving credit facility which iswas comprised of a maximum $50 million revolving credit facility (“Credit Facility”), with a minimum ~~draw~~borrowing amount for interest calculations of $4.5 million upon execution of the Credit Agreement. ~~The Credit Facility matures on December 31, 2024.~~ Availability under the Credit Facility iswas determined monthly by a borrowing base comprised of a percentage of eligible accounts receivable and eligible inventory of the Borrowers. Outstanding amounts exceeding the borrowing base ~~must~~were to be repaid immediately. The Borrowers’ obligations under the Credit Agreement ~~are~~were guaranteed by the Company. The Loan Parties’ obligations under the Credit Agreement ~~are~~were secured by a continuing security interest in all property of each Loan Party, subject to certain Excluded Collateral (as defined in the Credit Agreement).

Borrowings under the Credit Facility ~~may take~~took the form of base rate (“Base Rate”) loans or Secured Overnight Financing Rate (“SOFR”) loans. SOFR loans ~~will bear~~bore interest at a rate per annum equal to Term SOFR (as defined in the Credit Agreement as the Term SOFR Reference Rate for a term of one month on the day) plus the Applicable Margin (as defined in the Credit Agreement), with a Term SOFR floor of 1%. Base Rate loans ~~will bear~~bore interest at a rate per annum equal to the Applicable Margin plus the greatest of (a) the per annum rate of interest which is identified as the “Prime Rate” and normally published in the Money Rates section of The Wall Street Journal, (b) the sum of the Federal Funds Rate (as defined in the Credit Agreement) plus 0.5% and (c) 3.50% per annum.

The Applicable Margin ~~varies~~varied depending on the average outstanding amount for a preceding month. If the average outstanding amount for a preceding month iswas less than $15 million, the Applicable Margin will be 2.50% for Base Rate loans and 3.50% for SOFR loans. If the average outstanding amount for a preceding month iswas between $15 million and $25 million, the Applicable Margin will be 3.00% for Base Rate loans and 4.00% for SOFR loans. If the average outstanding amount for a preceding month iswas greater than $25 million, the Applicable Margin will be 4.5% for Base Rate loans and 5.50% for SOFR loans. The Company paid monthly fees of 0.4% per annum on the unused portion of the Credit Facility.

The Credit Agreement ~~contains~~contained a financial covenant whereby the Loan Parties shall not permit the consolidated Liquidity (as defined in the Amended Credit Agreement) to be less than ~~$10~~$8 million at any ~~time.~~time (the “Liquidity Covenant”). The Credit Agreement also ~~contains~~contained certain customary covenants, ~~which include, but are not limited to,~~including restrictions on indebtedness, liens, fundamental changes, restricted payments, asset sales, and investments, and places limits on various other payments. The Company determined that the term “Eligible Accounts”, as defined in the Credit Agreement would have excluded certain balances used in the determination of eligible collateral upon which the Company’s borrowing base is calculated and that exclusion would have resulted in a violation of the Liquidity Covenant as of December 31, 2022.Accordingly, to clarify this matter and others, the Loan Parties agreed to amend the Credit Agreement, (the “Amended Credit Agreement”) to modify and clarify the definitions of “Eligible Accounts”, “Permitted Indebtedness” and also “Eligible Inventory”. The Amendment was entered into on February 25, 2023 with an effective date of December 15, 2022. The Company was in compliance with the financial covenants of the Amended Credit Agreement as of March 31, ~~2023~~2024.

~~Upon execution of the Credit Agreement, the Company paid $1.1 million of debt issuance costs, which will be amortized to interest expense throughout the term of the agreement. As of~~ ~~March 31, 2023~~, the Company had outstanding borrowings of $4.5 million, a gross borrowing base of $16.3 million and excess availability of $11.8 million. The Company’s policy is to classify outstanding borrowings as long-term so long as such borrowings are not expected to exceed the borrowing base over the 12 months subsequent to the balance sheet date, in which case, any excess borrowings would be classified as short-term.

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~The following tables set forth the principal amount outstanding and interest expense for the periods (in thousands):~~

March 31,
2023 December 31,
2022
Principal $ 4,467 $ 7,851
Less: unamortized issuance costs $ (816) $ (932)
Net carrying amount $ 3,651 $ 6,919

The effective interest rate of the Credit Facility was 21.1%, which includes 10.5% related to amortization of original issuance costs, for the three months ended March 31, 2023. The following table sets forth total interest expense recognized related to the Credit Facility (in thousands):

~~Three Months Ended March 31,~~

~~2023~~

~~Contractual interest expense~~

~~118~~

~~Amortization of debt issuance costs~~

~~117~~

~~Total interest expense~~

~~235~~

On May 2, 2023, (1) two related parties (the “Participants”) collectively purchased a $4.0 million last-out subordinated participation interest in the Credit Agreement (the “Participation Interest”) from the Lender, and (2) the Borrowers entered into an amendment to the Credit Agreement which increased the borrowing base under the Credit Facility by $4.0 million, increased the minimum ~~draw~~borrowing amount for interest calculations to $8.5 million, and modified certain covenants. In connection with the purchase of the Participation Interest, we agreed to pay the Participants an aggregate exit fee ranging from 7.5% to 12.5% of the amount of the Participation Interest, payable upon the earlier to occur of (a) the maturity date of the Credit Facility, (b) termination of the Lender’s commitment to make revolving loans prior to the scheduled maturity date of the Credit Facility, and (c) the early redemption of the Participation Interest, as applicable. Further, the purchase of the Participation Interest granted an option for the Participants to purchase the subject revolving loan or to redeem its Participation Interest under certain circumstances. The Participants are each affiliates of beneficial holders of greater than five percent of our outstanding common stock.Accretion of the exit fee attributable to related parties recorded within interest expense, net on the condensed consolidated statements of operations was $0.1 million for the three months ended March 31, 2024.

Upon execution of the Credit Agreement in August 2022, the Company incurred $1.1 million of debt issuance and related costs, which are being amortized to interest expense throughout the term of the agreement. As of March 31, 2024 and December 31, 2023, there were $0.4 million and $0.5 million, respectively, of unamortized debt issuance costs on the Credit Facility included within prepaid expenses and other and other assets on the condensed consolidated balance sheets. As of March 31, 2024, the Company had outstanding borrowings of $4.7 million.

The effective interest rate of the average outstanding balance for the Credit Facility was 29.7%, which includes 8.3% related to amortization of original issuance costs, and 21.1%, which includes 10.5% related to amortization of original issuance costs, for the three months ended March 31, 2024 and 2023, respectively. The following table sets forth total interest expense recognized related to the Credit Facility (in thousands):


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	222	$	118
Amortization of debt issuance costs	117		117
Total interest expense	$	339	$	235

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note 5. Share-based Compensation

During the three months ended March 31, ~~2023~~2024 and ~~2022~~2023, the Company granted awards under the 2018 Omnibus Incentive Compensation Plan, previously named the Amended and Restated 2009 Omnibus Incentive Compensation Plan (the “2018 Plan”), and the 2015 Incentive Compensation Plan (the “2015 Plan”). The Compensation Committee of the Board of Directors administers the plans. Under the 2018 Plan, ~~a maximum of 9,574,995~~ shares of common stock may be issued upon the exercise of stock options, in the form of restricted stock, or in settlement of restricted stock units (“RSUs”) or other awards, including awards with alternative vesting schedules such as performance-based criteria.

The following table presents total share-based compensation expense within each functional line item on the condensed consolidated statements of operations for the three months ended March 31, ~~2023~~2024 and ~~2022,~~2023 (in thousands):

Three Months Ended
March 31,
2023 2022
Cost of revenues $ 184 $ 1,415
Research and development 248 4,070
Sales and marketing 330 2,043
General and administrative 1,038 3,671
Total $ 1,800 $ 11,199

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~


	Three Months Ended March 31,
	2024		2023
Cost of revenues	$	31	$	184
Research and development	160		248
Sales and marketing	165		330
General and administrative	361		1,038

Total	$	717	$	1,800

Stock Options

The Compensation Committee of the Board of Directors determines eligibility, vesting schedules and exercise prices for stock options granted. The Company generally uses the Black-Scholes option pricing model to estimate the fair value of its stock options. For performance stock awards subject to market-based vesting conditions, fair values are determined using the Monte-Carlo simulation model. Stock options generally have a term of ten years and vest over a three- to four-year period.

The following table summarizes the Company’s stock option activity for the three months ended March 31, ~~2023~~2024:

Outstanding — December 31, ~~2022~~2023

~~8,132,959~~545,872

Granted

~~38,750~~14,250

Canceled

~~(728,002)~~(111,994)

Outstanding — March 31, ~~2023~~2024

~~7,443,707~~448,128

Exercisable — March 31, ~~2023~~2024

~~5,423,759~~338,346

At March 31, ~~2023,~~2024, total unrecognized compensation expense related to stock options was $~~6.2~~0.7 million, which is expected to be recognized over a weighted-average period of ~~2.52~~3.29 years.

Restricted Stock Units

Pursuant to the 2018 Plan and the 2015 Plan, the Company may issue RSUs that, upon satisfaction of vesting conditions, allow recipients to receive common stock. Issuances of such awards reduce common stock available under the 2018 Plan and 2015 Plan for stock incentive awards. The Company measures compensation cost associated with grants of RSUs at fair value, which is generally the closing price of the Company’s stock on the date of grant. RSUs generally vest over a three- to four-year period.

The following table summarizes the Company’s RSU activity for the three months ended March 31, ~~2023~~2024:






Non-vested — December 31, ~~2022~~2023			~~1,178,370~~203,008
Granted			~~7,500~~—
Vested			~~(73,350)~~(6,597)
Forfeited			~~(67,809)~~(10,590)
Non-vested — March 31, ~~2023~~2024			~~1,044,711~~185,821

INSEEGO CORP.

Notes to Condensed Consolidated Financial Statements (Unaudited)

At March 31, ~~2023,~~2024, total unrecognized compensation expense related to RSUs was $~~3.3~~1.6 million, which is expected to be recognized over a weighted-average period of ~~2.11~~1.07 years.

On April 28, 2023, the Company granted a total of approximately 2.2 million RSUs to certain employees to encourage retention and incentivize future performance (“Retention Awards”). All of the Retention Awards fully vest on November 1, 2023.

Note 6. ~~Earnings Per~~Loss per Share

Basic earnings (loss) per share (“EPS”) excludes dilution and is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock using the treasury stock method. Potentially dilutive securities (consisting primarily of the 2025 Notes calculated using the if-converted method and warrants, stock options and RSUs calculated using the treasury stock method) are excluded from the diluted EPS computation in loss periods and when the applicable exercise price is greater than the market price on the period end date as their effect would be anti-dilutive.

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

The calculation of basic and diluted earnings per share was as follows (in thousands, except share and per share data):






		Three Months Ended March 31,
		2023		2022
Net loss attributable to common stockholders	Net loss attributable to common stockholders	$	(5,827)	$	(25,884)
Weighted-average common shares outstanding		108,601,894		105,649,419
Net loss attributable to common stockholders
Net loss attributable to common stockholders
Weighted-average common shares outstanding*
Weighted-average common shares outstanding*
Weighted-average common shares outstanding*
Basic and diluted net loss per share	Basic and diluted net loss per share	$	(0.05)	$	(0.24)
Basic and diluted net loss per share
Basic and diluted net loss per share

(*) Adjusted retroactively for reverse stock split that occurred on January 24, 2024, see Note 1

The following is a summary of outstanding anti-dilutive potential shares of common stock that have been excluded from diluted net loss per share attributable to common stockholders because their inclusion would have been ~~anti-dilutive:~~anti-dilutive (in thousands):


	As of March 31,						As of March 31,
(in thousands)	(in thousands)	March 31, 2023	December 31, 2022	(in thousands)	2024	2023
2025 Notes	2025 Notes	14,090	14,090
Non-qualified stock options	Non-qualified stock options	7,956	8,133
Restricted stock units	Restricted stock units	1,139	1,178
Employee stock purchase plan	Employee stock purchase plan	2,200	426
Total	Total	25,385	23,827

Note 7. Public Offering

In January 2021, the Company entered into an Equity Distribution Agreement with Canaccord Genuity LLC (the “Agent”), pursuant to which the Company ~~may~~could offer and sell, from time to time, through or to the Agent, up to $40.0 million of shares of its common stock (the “ATM Offering”). In January 2021, the Company sold 1,516,073 shares of common stock, at an average price of $20.11 per share, for net proceeds of $29.4 million, after deducting underwriter fees and discounts, and other offering fees, pursuant to the ATM Offering. There were no ATM transactions in 2022. In March 2023, the Company’s Board of Directors (BOD) approved the issuance of up to the remaining $9.5 million worth of shares under this ATM Offering. During the quarter ended March 31, 2023 the Company sold ~~858,098~~85,810 shares of common stock, at an average price of ~~$0.62~~$6.17 per share, for net proceeds of $0.5 million, after deducting underwriter fees and discounts. AsEffective as of ~~March 31,~~November 2, 2023, the Equity Distribution Agreement was terminated by the Company, and there ~~were approximately $9 million of shares remaining available for sale~~will be no further sales under ~~this~~the ATM Offering.

Note 8. Geographic Information and Concentrations of Risk

Geographic Information

The following table details the Company’s ~~net~~ revenues by geographic region based on shipping destination (in thousands):

Three Months Ended
March 31,
2023 2022
United States and Canada $ 43,205 $ 52,642
Europe $ 5,987 $ 5,620
Australia (a)
$ 1,598 $ 1,013
Other $ 4 $ 2,109
Total $ 50,794 $ 61,384
~~(a)~~ ~~Prior period was reclassified~~


	Three Months Ended March 31,
	2024		2023
United States and Canada	$	35,476	$	43,205
Europe (including United Kingdom)	$	6,751	$	5,987
Australia	$	2,780	$	1,598
Other	$	2	$	4
Total	$	45,009	$	50,794

INSEEGO CORP.

Notes to ~~conform to current period presentation.~~Condensed Consolidated Financial Statements (Unaudited)

Concentrations of Credit Risk

For the three months ended March 31, 2024, two customers accounted for 39.3% and 18.2% of revenues, respectively. For the three months ended March 31, 2023, two customers accounted for 31.1% and 26.6% of ~~net~~ revenues, respectively. ~~For the three months ended March 31, 2022, two customers accounted for 37.3% and 39.9%, respectively, of net revenues.~~

As of March 31, ~~2023,~~2024, three customers accounted for ~~42.4%~~32.0%, ~~16.0%~~13.3%, and ~~14.6%~~10.9% of accounts receivable, net, respectively. As of December 31, ~~2022,~~2023, two customers accounted for ~~37.4%~~41.8% and ~~21.9%~~10.2% of accounts receivable, net, respectively.

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

Note 9. Commitments and Contingencies

Noncancellable Purchase Obligations

The Company typically enters into commitments with its contract manufacturers that require future purchases of goods or services in the three to four quarters following the balance sheet date. Such commitments are noncancellable (“noncancellable purchase obligations”). As of March 31, ~~2023,~~2024, future payments under these noncancellable purchase obligations were approximately ~~$53.4~~$60.1 million.

Legal

The Company is, from time to time, party to various legal proceedings arising in the ordinary course of business. The Company is regularly required to directly or indirectly participate in other U.S. patent infringement actions pursuant to its contractual indemnification obligations to certain customers. Based on an evaluation of these matters the Company currently believes that liabilities arising from, or sums paid in settlement of these existing matters, if any, would not have a material adverse effect on its consolidated results of operations or financial condition.

Indemnification

In the normal course of business, the Company periodically enters into agreements that require the Company to indemnify and defend its customers for, among other things, claims alleging that the Company’s products infringe upon third-party patents or other intellectual property rights. The Company’s maximum exposure under these indemnification provisions cannot be estimated but the Company does not believe that there are any matters individually or collectively that would have a material adverse effect on its consolidated results of operations or financial condition.

Note 10. ~~Leases~~

~~The components of the right-of-use assets and lease liabilities were as follows (in thousands):~~

Balance Sheet Classification March 31,
2023 December 31,
2022
Operating right-of-use assets, net Right-of-use assets $ 6,122 $ 6,662
Current operating lease liabilities Accrued expenses and other current liabilities $ 1,814 $ 1,759
Non-current operating lease liabilities Other long-term liabilities 5,149 5,903
Total operating lease liabilities $ 6,963 $ 7,662
Weighted-average remaining lease term (in years) 4.0 4.1
Weighted-average discount rate 9.0 % 9.0 %

~~The components of lease cost were as follows (in thousands):~~

Three Months Ended March 31,
2023 2022
Operating lease costs included in operating costs and expenses $ 592 $ 610

~~Supplemental cash flow information related to leases was as follows (in thousands):~~

Three Months Ended March 31,
2023 2022
Operating cash flows related to operating leases $ 624 $ 622
Operating right-of-use assets obtained in exchange for lease liabilities $ 50 $ 79

~~INSEEGO CORP.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~Future minimum payments under operating leases were as follows as of March 31, 2023 (in thousands):~~

2023 (remainder) $ 1,687
2024 2,090
2025 1,734
2026 1,707
2027 1,125
Thereafter —
Total minimum operating lease payments $ 8,343
Less: amounts representing interest (1,380)
Present value of net minimum operating lease payments 6,963
Less: current portion (1,814)
Long-term portion of operating lease obligations $ 5,149

~~11.~~ Income Taxes

The Company’s income tax provision ~~(benefit)~~ was ~~$0.3~~$0.2 million and ~~$(0.3)~~$0.3 million for the three months ended March 31, ~~2023~~2024 and ~~2022,~~2023, respectively. Income taxes for both periods consisted primarily of foreign income taxes at certain of the Company’s international entities and minimum state taxes for its U.S.-based entities. The Company’s income tax expense differs from the expected expense based on statutory rates primarily due to full valuation allowances at all of its U.S.-based entities and several of its foreign subsidiaries. The income tax ~~provision (benefit) provision~~provisions for the three months ended March 31, ~~2023~~2024 and ~~2022,~~2023, were largely driven by a combination of improved profits and unrealized foreign currency gains ~~and losses, respectively,~~ at the Company’s foreign subsidiaries.

Note 11.Subsequent Events

Effective April 18, 2024, the Company exercised its right to voluntarily pay-off and terminate its Credit Facility with Siena Lending Group LLC. As a result of the termination, the Company paid the outstanding balance and related termination fees on the Credit Facility of approximately $3.0 million. The Company has also paid an exit fee in the aggregate amount of $0.4 million to South Ocean Funding, LLC and North Sound Ventures, LP (collectively, the “Participants”) as a result of the early redemption of the Participants’ $4.0 million last-out subordinated participation interest in the Loan and Security Agreement pursuant to a Participation Agreement between the Participants and Siena Lending Group. South Ocean Funding, LLC is an affiliate of Golden Harbor, Ltd. and North Sound Ventures, LP is an affiliate of North Sound Management, Inc. As of April 18, 2024, each of Golden Harbor, Ltd. and North Sound Management, Inc. were beneficial owners of in excess of 5% of the Company’s outstanding common stock.

1815

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward Looking Statements

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)., in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You should not place undue reliance on these statements. These forward-looking statements include, without limitation, statements that reflect the views of our senior management with respect to our current expectations, assumptions, estimates and projections about Inseego Corp. (the “Company” or “Inseego”) and our industry. These forward-looking statements speak only as of the date of this report. We disclaim any undertaking to publicly update or revise any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Statements that include the words “may,” “could,” “should,” “would,” “estimate,” “anticipate,” “believe,” “expect,” “preliminary,” “intend,” “plan,” “project,” “outlook,” “will” and similar words and phrases identify forward-looking ~~statements.~~statements (although not all forward-looking statements contain these words). Forward-looking statements ~~address matters that involve~~are inherently subject to risks and uncertainties, ~~that could cause~~some of which cannot be predicted or quantified; therefore, our actual results tomay differ materially from those anticipated in these forward-looking statements as of the date of this report. We believe that these factors include those related to:

•our ability to makepayments on or to refinance our indebtedness, including our 3.25% convertible senior notes due in May 2025;

•our dependence on a small number of customers for a substantial portion of our revenues;

•our ability to compete in the market for wireless broadband data access products, wireless modem products, and ~~asset management, monitoring,~~ telematics ~~vehicle tracking~~products and ~~fleet management products;~~services;

•our ability to successfully develop and introduce new products and services;

•the pace of 5G wireless network rollouts globally and their adoption by customers;

•our dependence on wireless telecommunication operators delivering acceptable wireless services ~~successfully;~~

•our ability to meet the price and performance standards of the evolving 5G New Radio (“5G NR”) products and technologies;

•our ability to ~~expand our customer reach/reduce customer concentration;~~develop sales channels and to onboard channel partners;

•our ~~ability to grow~~relationships with and the ~~Internet of Things (“IoT”) and mobile portfolio outside of North America;~~

•~~our ability to grow our Ctrack/asset tracking solutions within North America;~~

•~~our dependence on a small number of customers for a substantial portion~~performance of our ~~revenues;~~

•~~our ability to make scheduled payments on, or to refinance our indebtedness, including our convertible notes obligations;~~channel partners;

•our ability to introduce and sell new products that comply with current and evolving industry standards and government regulations;

•our ability to develop and maintain strategic relationships to expand into new markets;

•our ability to properly manage the growth of our business to avoid significant strains on our management and operations and disruptions to our business;

•our reliance on third parties to manufacture our products;

•our contract ~~manufacturer’s~~manufacturers’ ability to secure necessary supply to build our devices;

•increases in costs, disruption of supply and/or the shortage of semiconductors or other key components of our products;

•~~our ability to mitigate the impact of tariffs or other government-imposed sanctions;~~

•our ability to accurately forecast customer demand and order the manufacture and timely delivery of sufficient product quantities;

•our reliance on sole source suppliers for some products and devices used in our solutions;

•~~the continuing impact of uncertain global economic conditions on the demand for our products;~~

•~~the impact of geopolitical instability on our business, including the current conflict between Russia and Ukraine;~~

•the emergence of global public health emergencies, such as the outbreak of the 2019 novel coronavirus (2019-nCoV), known as “COVID-19”, which could extend lead times in our supply chain and lengthen sales cycles with our customers;

•~~direct and indirect effects of COVID-19 on our employees, customers and supply chain and the economy and financial markets;~~

•~~the impact of high inflation and rising interest rates;~~

•our ability to be cost competitive while meeting time-to-market requirements for our customers;

•our ability to meet the product performance needs of our customers in mobile broadband and fixed wireless ~~broadband data~~ access ~~in industrial IoT (“IIoT”)~~ markets;

•demand for fleet, vehicle and asset management software-as-a-service (“SaaS”) telematics solutions;

•our ~~dependence on wireless telecommunication operators delivering acceptable wireless services;~~ability to make successful investments in research and development;

•the outcome of any pending or future litigation, including intellectual property litigation;

•infringement claims with respect to intellectual property contained in our solutions;

•our continued ability to license necessary third-party technology for the development and sale of our solutions;

•the introduction of new products that could contain errors or defects;

•conducting business abroad, including foreign currency risks;

•~~the pace of 5G wireless network rollouts globally and their adoption by customers;~~

•~~our ability to make focused investments in research and development; and~~

•our ability to hire, retain and manage ~~additional~~ qualified personnel to maintain and expand our business.

•our ability to mitigate the impact of tariffs or other government-imposed sanctions;

•the impact of high rates of inflation and rising interest rates;

•the continuing impact of uncertain global economic conditions on the demand for our products; and

•the impact of geopolitical instability on our business.

The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in this and other reports we file with or furnish to the Securities and Exchange Commission (“SEC”), including the information in “Item 1A. Risk Factors” included in Part I of our Annual Report on Form 10-K for the year ended December 31, ~~2022~~2023 (the “Form 10-K”). If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. As used in this report on Form 10-Q, unless the context otherwise requires, the terms “we,” “us,” “our,” the “Company” and “Inseego” refer to Inseego Corp., a Delaware corporation, and its wholly-owned subsidiaries.

Trademarks

“Inseego”, “Inseego Subscribe”, “Inseego Manage”, “Inseego Secure”, “Inseego Vision”, the Inseego logo, “MiFi”, “MiFi Intelligent Mobile Hotspot”, ~~“Wavemaker”~~”Wavemaker”, “Clarity”, and “Skyus” are trademarks or registered trademarks of Inseego and its subsidiaries. Other trademarks, trade names or service marks used in this report are the property of their respective owners.

2017

The following information should be read in conjunction with the condensed consolidated financial statements and the accompanying notes included in Part I, Item 1 of this report, as well as the annual consolidated financial statements and accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations for the year ended December 31, ~~2022,~~2023, contained in our Form 10-K.

Business Overview

Inseego Corp. is a leader in the design and development of cloud-managed 5G wireless ~~wide area network (WWAN)~~broadband and intelligent edge solutions. Our 4G and 5G wireless broadband portfolio is comprised of secure and high-performance ~~cloud-managed~~mobile broadband and fixed ~~and mobile WWAN modems, routers, and gateways; enterprise networking software-defined edge~~wireless access (“~~SD EDGE”~~FWA”) solutions ~~powered by our 5G WWAN portfolio that secures~~with associated cloud solutions for real time WAN visibility, monitoring, automation and ~~prioritizes corporate~~control with centralized orchestration of network ~~traffic;~~functions. These solutions are specifically built for the enterprise and small and medium business (“SMB”) market segments with a focus on performance, scalability, quality and enterprise grade security. Our intelligent edge ~~and~~ telematics solutions ~~with built-in artificial intelligence (“AI”) technology, created~~are designed to improve business ~~outcomes. All of these~~outcomes for enterprise and SMB market segments. We also provide a wireless subscriber management solution for carriers to manage their government and complex enterprise customer subscriptions.

Our 5G products and associated cloud solutions are designed and developed in the U.S. and are used in mission-critical applications requiring the highest levels of security and zero unscheduled downtime. These solutions support ~~business~~ applications such as business broadband for both mobile and fixed use cases, enterprise networking and software-defined wide area network (“SD-WAN”) failover ~~management, asset tracking, edge computing, artificial intelligence, fleet management, and other services.~~management.

~~We have been~~Inseego is at the forefront of ~~the ways in which the world stays connected~~providing high speed broadband through state-of-the-art 4G and ~~accesses information, protects,~~5G solutions to keep enterprise and ~~derives intelligence from that information.~~SMB customers seamlessly connected. With multiple first-to-market innovations ~~across a number~~through several generations of ~~wireless~~4G and 5G technologies, ~~including 5G, and a strong and growing portfolio of hardware and software innovations for IIoT solutions,~~ Inseego has been advancing wireless WAN technology and driving industry transformations for over 30 years. It is this proven expertise, commitment to quality, obsession with innovation and a relentless focus on execution that makes us a preferred global partner of service providers, distributors, value-added resellers, system integrators, and enterprises worldwide.

~~Our Sources of Revenue~~

We provide intelligent, cloud-managed wireless 4G and 5G hardware products for the worldwide mobile communications and IIoT markets. Our hardware products address multiple vertical markets including private LTE/5G networks, the First Responders Network Authority/Firstnet, SD-WAN, telematics, remote monitoring and surveillance, and fixed wireless access and mobile broadband devices. Our broad range of products principally includes intelligent 4G and 5G fixed wireless routers and gateways, mobile hotspots, wireless gateways and routers for IIoT applications, Gb speed 4G LTE hotspots and USB modems, integrated telematics and mobile tracking hardware devices, which are supported by applications software and cloud services designed to enable customers to easily analyze data insights and configure/manage their hardware remotely. Our products currently operate on ~~most~~all major ~~global~~ cellular ~~wireless networks.~~networks in the US. Our mobile hotspots, sold under the MiFi ™ brand, have been sold to millions of end users and provide ~~subscribers with~~secure and convenient high-speed broadband access to the Internet on the go.

Our Sources of Revenue

We classify our revenues from the sale of our products and services into two categories: Product Revenue, which consists of our Mobile Solutions and Fixed Wireless Access Solutions, and Services and Other. A description of each of the revenue classifications is as follows:

Mobile solutions: Our mobile broadband solutions, sold under the MiFi brand, are actively used by millions of end users to provide secure and convenient high-speed access to corporate, public and personal information through the Internet and enterprise networks. Our ~~wireless standalone and USB modems and gateways allow us to address the rapidly growing and underpenetrated IoT market segments. Our telematics and~~ mobile ~~asset tracking hardware devices collect and control critical vehicle data and driver behaviors, and can reliably deliver that information to the cloud, all managed~~portfolio is supported by our ~~services enablement platforms.~~

cloud offerings - Inseego Connect for device management, and 5G SD EDGE for secure networking enabling corporate managed mobile remote workforce. Our ~~MiFi~~Mobile Solutions portfolio also includes 4G VoLTE products and 4G USB modems. Our Mobile Solutions customer base is primarily comprised of ~~wireless operators to whom we provide intelligent fixed and~~ mobile ~~wireless devices.~~operators. These ~~wireless~~mobile operators include Verizon Wireless, T-Mobile and U.S. Cellular in the United States, Rogers and Telus in Canada, Telstra in Australia, as well as other international wireless operators, distributors and various companies in other vertical markets and geographies.

Fixed wireless access solutions: Our fixed wireless access solutions are deployed by enterprise and SMB customers for their distributed sites and employees as a fully secure and corporate managed wireless WWAN solution. The portfolio consists of indoor, outdoor and industrial routers and gateways supported by our cloud solutions – Inseego Connect for device management and 5G SD Edge for secure cloud networking. These solutions, sold under the Wavemaker and Skyus brands, are sold by mobile operators such as T-Mobile, U.S. Cellular and Verizon Wireless along with distribution and channel partners.

Services and other: We sell our 5G WWAN solutions, integrated telematics and mobile tracking hardware devices through our direct sales force, value-added resellers and through distributors. The customer base for our products is comprisedcertain other types of transportation companies, industrial enterprises, retailers, manufacturers, application service providers, system integrators and distributors in various industries, including fleet and vehicle transportation, aviation ground service management, energy and industrial automation, security and safety, medical monitoring and government. Integrated telematics and asset tracking devices are provided as part of our integrated SaaS solutions.

We sell SaaS, software and services solutions across multiple vertical markets, including fleet management, vehicle telematics, stolen vehicle recovery, asset tracking, monitoring, business connectivity and subscription management. Our SaaS delivery platforms include First is our telematics and asset tracking solution that is deployed across multiple vertical markets in Europe, UK, Australia and New Zealand. This solution provides real time visibility to fleet managers on their deployed vehicles with live maps and data to improve driver safety and performance. We have thousands of enterprise and SMB customers currently subscribed to this service. Second, we provide a wireless subscriber management ~~platforms, which~~solution (Inseego Subscribe) for carrier’s management of their government and complex enterprise customer subscriptions. We also categorize non-recurring engineering services we provide ~~fleet, vehicle, aviation, municipalities, healthcare, utilities asset~~to our customers as Service and other telematics applications. Our SaaS platforms are device-agnostic and provide a standardized, scalable way to order, connect and manage remote assets and to improve business operations. The platforms are flexible and support both on-premise server or cloud-based deployments and are the basis for the delivery of a wide range of IoT services in multiple industries.revenue.

Business Segment Reporting

We ~~classify~~operate as one business segment. Our principal executive officer, who is also our Chief Operating Decision Maker, evaluates the business as a single entity and reviews financial information and makes business decisions based on the overall results of the business. As such, our operations constitute a single operating segment and one reportable segment.

Financial Statement Presentation

During the fourth quarter of 2023 the Company reclassified revenues on the in order to align with how management currently reviews revenue results. Historically, the Company classified revenues from ~~the sale of our~~ products and services into two ~~distinct groupings, specifically~~categories, IoT & Mobile Solutions and Enterprise SaaS Solutions. ~~Both IoT &~~The Company is now classifying revenues into the following two categories: Product Revenue, which consists of our Mobile Solutions and ~~Enterprise SaaS~~Fixed Wireless Access Solutions, ~~revenues include any hardware~~ and ~~software required for the respective solution. .~~

~~Factors Which May Influence Future Results of Operations~~

~~Net Revenues.~~Services and Other. ~~We believe that our future net revenues may be influenced by a number of factors including:~~

•~~economic environment~~Additionally, during 2023 the Company reclassified all depreciation and ~~related market conditions such as inflation;~~

•~~increased competition from other fleet and vehicle telematics solutions, as well as suppliers of emerging devices that contain wireless data access or device management features;~~

•~~acceptance of our products by new vertical markets;~~

•~~growth~~amortization expense previously recorded in the ~~aviation ground vertical;~~

•~~rate~~operating expense line items of ~~change to new products;~~

•~~deployment of 5G infrastructure equipment;~~

•~~adoption of 5G end point products;~~

•~~competition in the area of 5G technology;~~

•~~our contract manufacturer’s ability to secure necessary supply to of semiconductors and other key components to build our devices;~~

•~~product pricing;~~

•~~the impact of the COVID-19 pandemic on our business; and~~

•~~changes in technologies.~~

~~Our revenues are also significantly dependent upon the availability of materials and components used in our hardware products.~~

We have made significant investments in additional products and services, including SaaS and additional service offerings, industrial IoT hardware and services, and other mobile and fixed wireless devices targeting the emerging 5G market. We continue to develop and maintain strategic relationships with service providers and other wireless industry leaders such as Verizon Wireless, T-Mobile, and Qualcomm. Through strategic relationships, we have been able to maintain market penetration by leveraging the resources of our channel partners, including their access to distribution resources, increased sales opportunities and market opportunities.

The demand environment for our 5G products during the three months ended March 31, 2023 was consistent with our expectations. However, we have recently experienced lower sales of LTE gigabit hotspots within IoT & Mobile Solutions as COVID-19 pandemic demand has eased. The macroeconomic environment continues to remain uncertain and the demand for our products in prior years may not be sustainable for the long term. We will continue to monitor the implications of the COVID-19 pandemic on our business, as well as our customers’ and suppliers’ businesses.

~~Cost of Net Revenues.~~ Cost of net revenues includes all costs associated with our contract manufacturers, distribution, fulfillment and repair services, delivery of SaaS services, warranty costs, amortization of intangible assets, royalties, operations overhead, costs associated with cancellation of purchase orders and costs related to outside services. Also included in cost of net revenues are costs related to inventory adjustments, as well as any write downs for excess and obsolete inventory and abandoned product lines. Inventory adjustments are impacted primarily by demand for our products, which is influenced by the factors discussed above. The inflationary pressures impacting the global supply chain could potentially increase the cost of net revenues in the current and future years.

~~Operating Costs and Expenses.~~ ~~Our operating costs consist of three primary categories:~~ research and development, sales and marketing, and general and administrative ~~costs.~~expenses into a separate line labeled

~~Research~~Depreciation and ~~development is at the core of our ability~~amortization. All prior periods have been reclassified to produce innovative, leading-edge products. These expenses consist primarily of engineers and technicians who design and test our highly complex products and the procurement of testing and certification services.

Sales and marketing expenses consist primarily of our sales force and product-marketing professionals. In order to maintain strong sales relationships, we provide co-marketing, trade show support and product training. We are also engaged in a wide variety of marketing activities, such as awareness and lead generation programs as well as product marketing. Other marketing initiatives include public relations, seminars and co-branding with partners.

General and administrative expenses include primarily corporate functions such as accounting, human resources, legal, administrative support and professional fees. This category also includes the expenses needed to operate as a publicly-traded company, including compliance with the Sarbanes-Oxley Act of 2002, as amended, SEC filings, stock exchange fees and investor relations expense. Although general and administrative expenses are not directly related to revenue levels, certain expenses, such as legal expenses and provisions for bad debts, may cause significant volatility in future general and administrative expenses, which may, in turn, impact net revenue levels.

~~As part of our business strategy, we may review acquisition or divestiture opportunities that we believe would be advantageous or complementary~~conform to the ~~development of our business. Given our~~ current ~~cash position and recent losses, any additional acquisitions we make would likely involve issuing stock or drawing on our revolving credit facility in order to provide the purchase consideration~~period presentation for the acquisitions. If we make any additional acquisitions, we may incur substantial expenditures in conjunction with the acquisition process and the subsequent assimilation of any acquired business, products, technologies or personnel.these changes.

Critical Accounting ~~Policies~~Estimates

We prepare our condensed consolidated financial statements in accordance with GAAP. The preparation of these condensed consolidated financial statements in conformity with GAAP requires us to make estimates and ~~Estimates~~

Inassumptions that affect the ~~notes to our~~reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and ~~in “Item 7. Management’s Discussion~~the reported amounts of revenues and ~~Analysis of Financial Condition~~expenses during the reporting period. We base our estimates on historical experience and ~~Results of Operations” included in our Form 10-K, we have disclosed those accounting policies~~other assumptions that we ~~consider to be significant in determining our~~believe are reasonable under the circumstances. Our actual results ~~of operations~~could differ significantly from these estimates under different assumptions and ~~financial condition.~~ conditions.

There have been no material changes to ~~those policies that we consider~~our critical accounting estimates as compared to ~~be significant since~~ the ~~filing of our Form 10-K. The~~critical accounting ~~principles used in preparing our unaudited condensed consolidated financial statements conform in all material respects to accounting principles generally accepted~~estimates discussed in the ~~U.S.~~Form 10-K.

Results of Operations

Three Months Ended March 31, ~~2023~~2024 Compared to Three Months Ended March 31, ~~2022~~2023

~~Net revenues~~Revenues. ~~Net revenues~~Revenues for the three months ended March 31, ~~2023~~2024 were ~~$50.8~~$45.0 million, compared to ~~$61.4~~$50.8 million for the same period in ~~2022.~~2023.

The following table summarizes net revenues by our two product categories (in thousands):

Three Months Ended
March 31, Change
Product Category 2023 2022 $ %
IoT & Mobile Solutions $ 43,627 $ 54,505 $ (10,878) (20.0) %
Enterprise SaaS Solutions 7,167 6,879 288 4.2
Total $ 50,794 $ 61,384 $ (10,590) (17.3)


	Three Months Ended March 31,				Change
Product Category	2024		2023		$		%
Mobile solutions	$	15,270	$	23,040	$	(7,770)	(33.7)	%
Fixed wireless access solutions	14,182		11,870		2,312		19.5
Product revenues	29,452		34,910		(5,458)		(15.6)
Services and other	15,557		15,884		(327)		(2.1)
Total revenues	$	45,009	$	50,794	$	(5,785)	(11.4)

~~IoT &~~ Mobile ~~Solutions.~~solutions. The ~~$10.9~~$7.8 million decrease in ~~IoT & Mobile Solutions net~~mobile solutions revenues ~~over~~is primarily a result of investing more of our resources in the ~~same period~~premium 5G MiFi category as opposed to developing a low-end, lower margin 5G MiFi, which resulted in ~~2022~~lower sales during the three months ended March 31, 2024 as compared to the three months ended March 31, 2023.

Fixed wireless access solutions.The $2.3 millionincrease in fixed wireless access solutions revenues is primarily due to ~~decreases in~~the increased adoption of fixed wireless access products by our ~~carrier offerings and lower~~customers, specifically sales of ~~LTE gigabit hotspots as~~a 5G fixed wireless access device that we launched in the ~~COVID-19 pandemic demand eased,~~second quarter of 2023.

Services and other The $0.3 milliondecrease in services and other net revenues is primarily due to decreased Inseego Subscribe revenues, partially offset by ~~sales~~increased telematics subscription revenues. Based on the terms of ~~our second-generation and fourth-generation 5G hotspot related to our MiFi business (launched in later part of 2022) and subscriber growth in our Enterprise and~~a two-year service contract for Inseego Subscribe ~~businesses.~~

~~Enterprise SaaS Solutions.The $0.3 million~~that was renewed in April 2024, we expect Inseego Subscribe revenues to increase in ~~Enterprise SaaS Solutions net revenues over the same period in 2022 is primarily due to~~ ~~increase in Enterprise SaaS Solutions net revenue throughout the rest of the world as a result of the lifting of COVID-19 related installation restrictions in place during fiscal 2022~~.future periods.

Cost of ~~net~~ revenues. Cost of ~~net~~ revenues for the three months ended March 31, ~~2023~~2024 was $27.6 million, or 61.4% of revenues, compared to $32.6 million, or 64.2% of ~~net revenues, compared to $46.1 million, or 75.2% of net~~ revenues, for the same period in ~~2022.~~2023.

The following table summarizes cost of ~~net~~ revenues by ~~our two product categories~~category (in thousands):

Three Months Ended
March 31, Change
Product Category 2023 2022 $ %
IoT & Mobile Solutions $ 29,662 $ 42,903 $ (13,241) (30.9) %
Enterprise SaaS Solutions 2,945 3,233 (288) (8.9)
Total $ 32,607 $ 46,136 $ (13,529) (29.3)


	Three Months Ended March 31,				Change
Product Category	2024		2023		$		%
Product	$	22,713	$	27,967	$	(5,254)	(18.8)	%
Services and other	4,904		4,640		264		5.7
Total cost of revenues	$	27,617	$	32,607	$	(4,990)	(15.3)

~~IoT & Mobile Solutions.~~Product. The ~~$13.2~~$5.3 million decrease in ~~IoT & Mobile Solutions~~Product cost of ~~net~~ revenues ~~over the same period in 2022~~ is primarily is a result of lower sales of ~~LTE gigabit hotspots.~~4G hotspots, partially offset by increased sales of fixed wireless access solutions.

~~Enterprise SaaS Solutions.~~Services and other. The $0.3 million ~~decrease~~increase in ~~Enterprise SaaS Solutions~~Services and other cost of ~~net~~ revenues ~~over the same period in 2022~~ is primarily due to ~~reduced costs associated with providing our recurring rental~~product mix as higher cost telematics services increased in comparison to the prior period, both in total and ~~subscription services.~~as a percentage of total Services and other revenues.

Gross profit. Gross profit for the three months ended March 31, ~~2023~~2024 was $17.4 million, or a gross margin of 38.6%, compared to $18.2 million, or a gross margin of 35.8%, ~~compared to $15.2 million, or a gross margin of 24.8%,~~ for the same period in ~~2022.~~2023. The ~~increase~~decrease in gross profit is primarily due anto lower revenues. The increase in ~~revenue from Enterprise SaaS Solutions~~gross profit margin is due to a larger proportion of higher margin service revenues as ~~well as various initiatives to improve efficiencies in production.~~a percentage of total revenues.

Operating costs and expenses. The following table summarizes operating costs and expenses (in thousands):


		Three Months Ended March 31,				Change
	Three Months Ended March 31,															Three Months Ended March 31,					Change
Operating costs and expenses	Operating costs and expenses	2023		2022		$		%		Operating costs and expenses	2024			2023				$				%
Research and development	Research and development	$	8,154	$	18,560	$	(10,406)	(56.1)	%	Research and development	$	5,043	$	$	3,775		$	$	1,268	33.6			33.6	%
Sales and marketing	Sales and marketing	6,646		9,773		(3,127)		(32.0)
General and administrative	General and administrative	6,045		8,238		(2,193)		(26.6)
Amortization of purchased intangible assets		429		444		(15)		(3.4)
Depreciation and amortization
Impairment of capitalized software	Impairment of capitalized software	504		—		504		100.0
Total	Total	$	21,778	$	37,015	$	(15,237)	(41.2)

Research and development expenses. Research and development expenses for the three months ended March 31, ~~2023~~2024 were ~~$8.2~~$5.0 million, or ~~16.1%~~11.2% of net revenues, compared to $3.8 million~~$18.6 million,~~, or ~~30.2%~~7.4% of net revenues, for the same period in ~~2022.~~2023. The ~~decrease~~increase in research and development expenses was primarily due to ~~net decrease~~fewer research and development projects that were capitalizable during the three months ended March 31, 2024, which resulted in a higher percentage of research and development costs being recorded as ~~fewer new projects were undertaken during the current period.~~operating expenses, partially offset by lower personnel related costs.

Sales and marketing expenses. Sales and marketing expenses for the three months ended March 31, ~~2023~~2024 were ~~$6.6~~$5.0 million, or ~~13.1%~~11.1% of net revenues, compared to ~~$9.8~~$6.5 million, or ~~15.9%~~12.7% of net revenues, for the same period in ~~2022.~~2023. The decrease in sales and marketing expenses was primarily due to lower ~~consulting costs and other~~ sales personnel-related costs as a result of the decrease in overall sales headcount compared to the same period in ~~2022.~~2023.

General and administrative expenses. General and administrative expenses for the three months ended March 31, ~~2023~~2024 were ~~$6.0~~$5.0 million, or ~~11.9%~~11.1% of net revenues, compared to ~~$8.2~~$5.7 million, or ~~13.4%~~11.3% of net revenues, for the same period in ~~2022.~~2023. The decrease in general and administrative expense was primarily due to a decrease in share-based ~~expense~~compensation expense.

Depreciation and amortization expenses. Depreciation and amortization expenses for the three months ended March 31, 2024 were $3.6 million, or 8.1% of net revenues, compared to $5.3 million, or 10.5% of net revenues, for the same period in 2023. The decrease in depreciation and amortization expenses was primarily due to lower ~~RSU bonus released~~amortization related to capitalized software projects during the three months ended March 31, ~~2023~~2024 compared to the same period in ~~2022.~~2023.

Impairment of capitalized software. For the three months ended March 31, 2024 and 2023, we recorded impairments of $0.4 million and $0.5 million, respectively.

Other (expense) income. The following table summarizes other (expense) income (in thousands):


		Three Months Ended March 31,				Change
	Three Months Ended March 31,												Three Months Ended March 31,		Change
Other (expense) income	Other (expense) income	2023		2022		$		%		Other (expense) income	2024	2023		$		%

Loss on debt conversion and extinguishment, net		—		(450)		450		(100.0)	%
Interest expense, net	Interest expense, net	$	(1,997)	$	(2,923)	$	926	(31.7)
Other (expense) income, net	Other (expense) income, net	795		(405)		1,200		(296.3)
Total	Total	$	(1,202)	$	(3,778)	$	2,576	(68.2)

~~Loss on debt conversion and extinguishment, net~~.Interest expense, net. The ~~loss on debt conversion and extinguishment,~~$0.2 million increase in interest expense, net for the three months ended March 31, ~~2023 and 2022 was $0 and $0.5 million, respectively.~~

~~Interest expense, net.~~ ~~The $0.9 million decrease in interest expense~~2024 over the same period in ~~2022~~2023 was primarily a result of ~~certain 2022 Notes debt extinguishments related adjustments recorded in~~interest expense associated with the ~~prior period.~~Company’s Credit Facility.

Other (expense) income, net. The $1.2 million ~~increase~~decrease in other (expense) income, net for the three months ended March 31, 2024 over the same period in ~~2022~~2023 is primarily due to foreign currency exchange gains in the ~~current~~prior period.

Income tax ~~provision (benefit).~~provision. Income tax provision for the three months ended March 31, ~~2023~~2024 and ~~2022~~2023 was a provision of ~~$0.3~~$0.2 million and ~~a benefit of~~ $0.3 million, respectively. This $0.6 million increase in income tax expense was driven by a marked increase in pre-tax profits at Inseego SA (Pty) Ltd (previously, C-track Holdings) for the current year period compared to a loss in the prior year period.

Series E preferred stock dividends. During the three months ended March 31, ~~2023~~2024 and ~~2022,~~2023, we recorded dividends of ~~$0.7~~$0.8 million and $0.7 million, respectively, on our ~~Fixed-Rate Cumulative Perpetual Preferred Stock,~~ Series E Preferred Stock.

Reverse Stock Split

On January 24, 2024, the Company completed a 1-for-10 reverse stock split of its issued and outstanding common stock (the “Reverse Stock Split”). As a result of the Reverse Stock Split, each share of common stock issued and outstanding immediately prior to January 24, 2024 were automatically converted into one-tenth (1/10) of a share of common stock. The Reverse Stock Split did not change the par value ~~$0.001~~of the common stock or the authorized number of shares of common stock. All outstanding convertible notes, stock options and RSUs entitling their holders to purchase or obtain or convert into shares of our common stock were adjusted, as required by the terms of these securities. All applicable common share and per share ~~(the “Series E Preferred Stock”). There was minimal increase in preferred stock dividends for~~amounts have been retrospectively restated to show the ~~period ended March 31, 2023.~~

effect of the reverse split.

Liquidity and Capital Resources

~~Our principal sources of liquidity are our existing cash and cash equivalents and availability under our new revolving credit facility.~~ As of March 31, ~~2023, we~~2024, the Company had available cash and cash equivalents totaling ~~$8.7~~$12.3 million and ~~$11.8~~working capital of $3.6 million. The Company’s Credit Facility (as defined in Note 4 – Debt in the accompanying condensed consolidated financial statements), which had an outstanding balance of $4.7 million ~~of excess availability under our revolving credit facility. We also have an equity distribution agreement through which we may sell shares of our common stock, and~~ as of March 31, 2024, was voluntarily paid-off and terminated by the Company effective April 18, 2024.

The Company’s 2025 Notes have a principal balance of $161.9 million and mature on May 1, 2025. The Company’s intention is to restructure or refinance the 2025 Notes, and the Company is in active negotiations to do so, however there ~~was approximately $9 million~~can be no assurance that any required or desired restructuring or financing will be available on terms favorable to the Company, or at all. As the refinancing of ~~cash remaining before underwriter fees and discounts~~the 2025 Notes cannot be assured, accounting guidance requires disclosure that ~~we may generate from such issuance.~~this raises substantial doubt about the Company’s ability to continue as a going concern within one year of the issuance of these financial statements.

~~We have~~While the Company’s liquidity has had several positive developments recently, as noted above, the Company has a history of operating and net losses and overall usage of cash from operating and investing activities. ~~Our management believes that our cash~~The Company’s ability to attain profitable operations and ~~cash equivalents, together with anticipated~~continue to generate positive cash flows ~~from operations, availability under our secured asset-backed revolving credit facility,~~is dependent upon achieving a level and ~~anticipated savings from ongoing~~mix of revenues adequate to support its evolving cost ~~reduction efforts, will be sufficient~~structure. In order to ~~meet our cash flow needs for~~effect a restructuring or refinancing of the ~~next twelve months from the filing date of this report. If~~2025 Notes, or if events or circumstances occur such that ~~we do~~the Company does not meet ~~our~~its operating plan as expected, or if ~~we become~~the Company becomes obligated to pay unforeseen expenditures as a result of ~~ongoing~~potential litigation weor otherwise, the Company may be required to raise capital, reduce planned research and development activities, incur additional restructuring charges or reduce other operating expenses and capital expenditures, which could have an adverse impact on ~~our~~the Company’s ability to achieve ~~our~~its intended business objectives.

Our liquidity could be compromised if there is any interruption in our business operations, a material failure to satisfy our contractual commitments or a failure to generate revenue from new or existing products. Ultimately, our ability to attain profitability and to generate positive cash flow is dependent upon achieving a level of revenues adequate to support our evolving cost structure and increasing working capital needs. If events or circumstances occur such that we do not meet our operating plan as expected, we may be required to raise additional capital, reduce planned research and development activities, incur additional restructuring charges or reduce other operating expenses and capital expenditures which could have an adverse impact on our ability to achieve our intended business objectives. There can be no assurance that any required or desired restructuring or financing will be available on terms favorable to us, or at all. If additional funds are raised by the issuance of equity securities, or in connection with any restructuring or refinancing of the 2025 Notes, Company stockholders could experience significant dilution of their ownership interests and securities issued may have rights senior to those of the holders of the Company’s common stock. If additional funds are raised by the issuance of debt securities, we may be subject to additional limitations on our operations. Additionally, we are uncertain of the full extent to which the COVID-19 pandemic will impact our business, operations and financial results.

Revolving Credit Facility

On August 5, 2022, we entered into a Loan and Security Agreement (the “Credit Agreement”) with Siena Lending Group LLC, as lender (“Lender”). The Credit Agreement established a $50.0 million secured asset-backed revolving credit facility (“Credit Facility”) with a final maturity date of December 31, 2024. On February 25, 2023, we entered into an amendment of the Credit Agreement ~~(“Amended Credit Agreement”)~~ with an effective date of December 15, 2022, which clarified certain terms within the Credit Agreement. On May 2, 2023, we entered into a third amendment of the Credit Agreement which increased the borrowing base under the Credit Facility by $4.0 million, increased the minimum borrowing amount for interest calculations to $8.5 million, and modified certain covenants (as so amended, the “Amended Credit Agreement”). On February 20, 2024, we entered into a fourth amendment (the “Fourth Amendment”) of the Credit Agreement which relaxed the financial covenants under the Credit Agreement by decreasing the minimum liquidity level we are required to maintain from $10 million to $8 million. Availability under the Credit Facility iswas determined monthly by a Borrowing Base (as defined in the Amended Credit Agreement) comprised of a percentage of eligible accounts receivable and eligible inventory of the Borrowers. Outstanding amounts exceeding the borrowing base must be repaid immediately.

Borrowings under the Credit Facility ~~may~~could take the form of base rate (“Base Rate”) loans or Secured Overnight Financing Rate (“SOFR”) loans. SOFR loans ~~will bear~~bore interest at a rate per annum equal to Term SOFR (as defined in the Amended Credit Agreement as the Term SOFR Reference Rate for a term of one month on the day) plus the Applicable Margin (as defined in the Amended Credit Agreement), with a Term SOFR floor of 1%. Base Rate loans ~~will bear~~bore interest at a rate per annum equal to the Applicable Margin plus the greatest of (a) the per annum rate of interest which is identified as the “Prime Rate” and normally published in the Money Rates section of The Wall Street Journal, (b) the sum of the Federal Funds Rate (as defined in the Amended Credit Agreement) plus 0.5% and (c) 3.50% per annum.

The Applicable Margin ~~varies~~varied depending on the average outstanding amount for a preceding month. If the average outstanding amount for a preceding month iswas less than $15 million, the Applicable Margin ~~will~~would be 2.50% for Base Rate loans and 3.50% for SOFR loans. If the average outstanding amount for a preceding month iswas between $15 million and $25 million, the Applicable Margin ~~will~~would be 3.00% for Base Rate loans and 4.00% for SOFR loans. If the average outstanding amount for a preceding month iswas greater than $25 million, the Applicable Margin ~~will~~would be 4.5% for Base Rate loans and 5.50% for SOFR loans.

On May 2, 2023, in addition to the amendment to the Credit Agreement entered into as described above, South Ocean Funding, LLC and North Sound Ventures, LP (the “Participants”) collectively purchased a $4.0 million last-out subordinated participation interest in the Amended Credit Agreement (the “Participation Interest”) from the Lender pursuant to a Participation Agreement between the Participants and the Lender (the “Participation Agreement”). In connection with the purchase of the Participation Interest, we agreed to pay the Participants an exit fee upon the earlier of (a) the scheduled maturity date of the Amended Credit Agreement, (b) the termination of the Lender’s commitment to make revolving loans prior to the scheduled maturity date of the Amended Credit Agreement, and (c) the early redemption of the Participants’ Participation Interest under the Participation Agreement (the earliest to occur of the foregoing, the “Exit Event”). The aggregate exit fee payable to the Participants is equal to (i) 7.5% of the Participation Interest, if the Exit Event occurs on or before December 31, 2023, (ii) 10.0% of the Participation Interest, if the Exit Event occurs between January 1, 2024 and June 30, 2024 and (iii) 12.5% of the Participation Interest, if the Exit Events occurs after June 30, 2024. Further, the purchase of the Participation Interest granted an option for the Participants to purchase the subject revolving loan or to redeem its Participation Interest under certain circumstances. South Ocean Funding, LLC is an affiliate of Golden Harbor, Ltd. and North Sound Ventures, LP is an affiliate of North Sound Management, Inc. As of the date hereof, each of Golden Harbor, Ltd. and North Sound Management,

Inc. hold in excess of 5% of the Company’s outstanding common stock. James Avery, a member of our Board of Directors, currently serves as Senior Managing Director of Tavistock Group, an affiliate of South Ocean Funding, LLC.

The Amended Credit Agreement ~~contains~~contained a financial covenant whereby the Loan Parties shall not permit the consolidated Liquidity (as defined in the Amended Credit Agreement) to be less than ~~$10~~$8 million at any time. The Amended Credit Agreement also ~~contains~~contained certain customary covenants, ~~which include, but are not limited to,~~including restrictions on indebtedness, liens, fundamental changes, restricted payments, asset sales, and investments, and ~~places~~placed limits on various other payments. We were in compliance with the financial covenants contained in the Amended Credit Agreement as of March 31, ~~2023.~~2024.

As of March 31, ~~2023,~~2024, we had outstanding borrowings under the Credit Agreement of ~~$4.5 million, a gross borrowing base of $16.3 million~~$4.7 million. The Company voluntarily paid-off and ~~excess availability of $11.8 million.~~

terminated the Credit Facility effective April 18, 2024.

2025 Notes

~~On May 12, 2020, we completed a registered public offering~~After taking into account exchanges and redemptions occurring in prior periods, the outstanding principal balance of ~~$100.0 million aggregate principal amount of our~~the Company’s 3.5% convertible senior notes due in May 2025 ~~(“the 2025~~(the “2025 Notes”) ~~and issued $80.4~~was $161.9 million ~~principal amount~~as of ~~2025 Notes in the privately negotiated exchange agreements that closed concurrently with the registered offering in May 2020.~~

~~As of~~both March 31, ~~2023~~2024 and December 31, ~~2022, $161.9 million in principal amount of the 2025 Notes were outstanding.~~2023. Assuming no repurchases or conversions of the 2025 Notes prior to May 1, 2025, the entire principal balance of $161.9 million is due on May 1, 2025. The 2025 Notes are senior unsecured obligations of the Company and bear interest at an annual rate of 3.25%, payable semi-annually in arrears on May 1 and November 1 of each year.

Equity Distribution Agreement

On January 25, 2021, we entered into an Equity Distribution Agreement with Canaccord Genuity LLC (the “Agent”), pursuant to which we ~~may~~could offer and sell, from time to time, through or to the Agent, up to $40.0 million of shares of our common stock (the “ATM Offering”) pursuant to the Company’s Registration Statement on Form S-3ASR (File No. 333-238057), as filed with the SEC on May 7, 2020 and amended from time to time. D~~During~~uring the ~~quarter~~three months ended March 31, 2023, the Company sold ~~858,098~~85,810 shares of common stock, at an average price of ~~$0.62~~$6.17 per share, for net proceeds of $0.5 million, after deducting underwriter fees and discounts. AsEffective as of ~~March 31,~~November 2, 2023, the Equity Distribution Agreement was terminated by the Company, and there ~~were approximately $9 million of shares remaining available for sale~~will be no further sales under the ATM ~~Offering.~~Offering.

Contractual Obligations and Commitments

~~Our~~As of March 31, 2024, our material contractual obligations ~~are as follows:~~consisted of the following:

•To mitigate the risk of material shortages and price increases, we enter into non-cancellable purchase obligations with certain key contract manufacturers for the purchase of goods and services in the three to four quarters following the balance sheet date. Our purchase obligations consist of agreements to purchase goods and services entered into in the ordinary course of business. As of March 31, ~~2023,~~2024, our future payments under these noncancellable purchase obligations were approximately ~~$53.4~~$60.1 million.

•$~~161,898~~161.9 million in outstanding principal amount of 2025 Notes with required interest payments; see Note 5 – Debt in the accompanying condensed consolidated financial statements;

•$~~4.5~~4.7 million in outstanding borrowings under the ~~revolving~~ Credit Facility; see Note 4 – Debt in the accompanying condensed consolidated financial statements; and

•Operating lease liabilities that are included on our consolidated balance ~~sheet; see Note 10.~~ ~~Leases.~~sheet.

There were no material changes in our other contractual obligations during the three months ended March 31, ~~2023.~~2024.

Historical Cash Flows

The following table summarizes our unaudited condensed consolidated statements of cash flows for the periods indicated (in thousands):

Three Months Ended
March 31,
2023 2022
Net cash provided by (used in) operating activities $ 7,659 $ (638)
Net cash used in investing activities (2,504) (3,890)
Net cash used in financing activities (3,340) (1,060)
Effect of exchange rates on cash (272) 957
Net increase (decrease) in cash, cash equivalents and restricted cash 1,543 (4,631)
Cash, cash equivalents and restricted cash, beginning of period 7,143 49,812
Cash, cash equivalents, and restricted cash, end of period $ 8,686 $ 45,181


	Three Months Ended March 31,
	2024		2023
Net cash provided by operating activities	$	4,546	$	7,659
Net cash used in investing activities	(577)		(2,504)
Net cash provided by (used in) financing activities	583		(3,340)
Effect of exchange rates on cash	226		(272)
Net increase in cash and cash equivalents	4,778		1,543
Cash and cash equivalents, beginning of period	7,519		7,143
Cash, cash equivalents, and restricted cash, end of period	$	12,297	$	8,686

Operating activities.

Net cash provided by operating activities for the three months ended March 31, 2024 is comprised of a $4.5 million net loss incurred during the period, which was offset by net cash provided by working capital of $2.9 million and total non-cash charges, including depreciation and amortization of $4.4 million and share-based compensation expense of $0.7 million.

Net cash provided by operating activities for three months ended March 31, 2023 is ~~primarily~~ comprised of a $5.1 million net loss incurred during the period, ~~net~~which was offset by cash ~~used for~~provided by working capital of ~~$3.6~~$4.2 million ~~partially offset by~~and total non-cash charges, including depreciation and amortization of $5.4 million and share-based compensation expense of $1.8 ~~million, and amortization of debt discount and debt issuance costs of $0.5~~ million.

~~Net cash used in operating activities for the same period in~~ ~~2022~~ is primarily comprised of a $25.2 million net loss and a $0.6 million non-cash gain attributable to the fair value adjustment on derivative instruments. which was offset by net cash provided from working capital of $3.9 million, and non-cash charges, including depreciation and amortization of $7.2 million share-based compensation expense of $11.2 million, $1.7 million of amortization of debt issuance and discount costs and other non-cash adjustments.

Investing activities.

Net cash used in investing activities during the three months ended March 31, ~~2023~~2024 is ~~primarily~~ comprised of $~~2.4~~0.6 million of cash outflows related to the development of software in support of our 5G products and ~~services and~~ ~~$0.1 million of~~ ~~property, plant and equipment purchases.~~services.

Net cash used in investing activities during the same period in ~~2022~~2023 is primarily comprised of ~~$3.1~~$2.4 million of ~~cash~~cash outflows related to the development of software in support of our 5G products and services and ~~$0.8~~$0.1 million of property, plant and equipment purchases.

Financing activities.

Net cash ~~used in~~provided by financing activities during the three months ended March 31, ~~2023~~2024 is ~~primarily~~ comprised of ~~$3.4~~$0.6 million of cash ~~outflow~~inflow related to ~~repayments of~~net borrowings on our revolving credit ~~facility, partially offset by~~ ~~$0.5 million in proceeds from public offering~~.facility.

Net cash used in financing activities for the same period in ~~2022~~2023 is primarily comprised of ~~$1.0~~$3.4 million ~~in principal~~of cash outflow related to net repayments of ~~financed assets.~~our revolving credit facility, partially offset by$0.5 million in proceeds from the ATM offering.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are exposed to market risk in the ordinary course of our business. Our revenue, earnings, cash flows, receivables, and payables are subject to fluctuations due to changes in foreign currency exchange rates. ~~The ongoing COVID-19 pandemic has increased the volatility of global financial markets, which may increase our foreign currency exchange risk.~~

Interest Rate Risk

2025 Notes and Embedded Derivative

Our total fixed-rate borrowings under the 2025 Notes as of both March 31, ~~2023~~2024 and December 31, ~~2022~~2023 were $161.9 ~~million.~~million. We record all of our fixed-rate borrowings at amortized cost and therefore, any changes in interest rates do not impact the ~~carrying~~ values that we report for these senior notes on our consolidated financial statements. As of March 31, 2024 and December 31, 2023, we had no variable-rate borrowings related to the 2025 Notes.

The 2025 Notes include an embedded derivative which was marked to a fair value of zero at both March 31, ~~2023~~2024 and December 31, ~~2022 of $0.~~2023. The fair value inputs to the derivative valuation include dividend yield, term, volatility, stock price, and risk-free rate. Consequently we may incur gains and losses on the derivative as changes occur in the stock price, volatility, and

risk-free rate at each reporting period. Additional details regarding our 2025 Notes and the embedded derivative are included in Part 1 Item 1 Note 3. 3 – Fair Value ~~Measurement of Assets and Liabilities~~Measurements and Note 4. 4 – Debt in this Quarterly Report on Form 10-Q.

Revolving Credit Facility

We ~~are~~have been exposed to interest rate risk associated with fluctuations in interest rates on our revolving credit facility. As of March 31, ~~2023,~~2024, assuming our revolving credit facility was fully drawn up to the ~~$16.3~~$15.0 million borrowing base, a 1% ~~increase~~change in interest rates would result in a ~~$0.1~~$0.2 million change in annualized interest expense. Effective April 18, 2024, the Company exercised its right to voluntarily pay-off and terminate the Credit Agreement.

Inflation Risk

Inflation has increased during the period covered by this Quarterly Report on Form 10-Q, and is expected to continue to increase for the near future. Inflationary factors, such as increases in the cost of our materials, supplies, and overhead costs may adversely affect our operating results. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience ~~some~~an effect if inflation rates continue to rise. Significant adverse changes in inflation and prices in the future could result in material losses.

Currency Risk

Foreign Currency ~~Transaction~~Exchange Risk

Our results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. A majority of our revenue is denominated in U.S. ~~Dollars, and therefore, our revenue is not directly subject to foreign currency risk.~~Dollars. However, as we have operations in foreign countries, primarily in Europe, a stronger U.S. Dollar could make our products and services more expensive in foreign countries and therefore reduce demand. A weaker U.S. Dollar could have the opposite effect. Such economic exposure to currency ~~fluctuations~~fluctuations is difficult to measure or predict because our sales are also influenced by many other factors.

For the three months ended March 31, ~~2023 and 2022,~~2024, sales denominated in foreign currencies were approximately ~~14.9% and 14.2%~~21.2% of total revenue. ~~Our expenses are generally denominated in the currencies in which our operations are located, which are primarily in the U.S. and to a lesser extent in Europe.~~ Our results of operations and cash flows are, therefore, subject to fluctuations due to changes in foreign currency exchange rates and may be adversely affected in the future due to changes in foreign exchange rates. These foreign ~~functional~~ currencies primarily consist of the South African Rand, British Pound, ~~Sterling,~~ Euro, and Australian Dollar ~~(collectively, the “Foreign Functional Currencies”)~~. For the three months ended March 31, ~~2023,~~ 2024, a hy~~pothetical~~hypothetical 10% change in ~~Foreign Functional~~ ~~Currency exchange rates~~these foreign currencies would have increased or decreased our revenue by ~~approximately $756,831.~~approximately $1.0 million. Actual gains and losses in the future may differ materially from the hypothetical gains and losses discussed above based on changes in the timing and amount of foreign currency exchange rate movements.

~~Foreign Currency Translation Risk~~

Fluctuations in foreign currencies impact the amount of total assets, liabilities, earnings and cash flows that we report for our foreign subsidiaries upon the translation of these amounts into U.S. Dollars for, and as of the end of, each reporting period. In particular, the strengthening of the U.S. Dollar generally will reduce the reported amount of our foreign-denominated cash, cash equivalents, marketable securities, total revenues and total expense that we translate into U.S. Dollars and report in our consolidated financial statements for, and as of the end of, each reporting period.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as defined in Rule 13a-15(e) and 15d-15(e) promulgated under the Exchange Act, that are designed to ensure that information required to be disclosed in our reports to the SEC are recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

As required by Rule 13a-15(b) promulgated under the Exchange Act, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, ~~2023,~~2024, the end of the period covered by this report. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of March 31, ~~2023.~~2024.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Exchange Act, during the quarter ended March 31, ~~2023,~~2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

2825

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

We are, from time to time, party to various legal proceedings arising in the ordinary course of business. We are currently not party to any litigation, the outcome of which, if determined adversely to us, would individually or in the aggregate be reasonably expected to have a material and adverse effect on our business, financial position or results of operations.

Item 1A. Risk Factors.

~~As of the date of this filing, except as discussed below, there have been~~There were no material changes to the risk factors ~~included in our Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on March 3, 2023. There have been no material changes in our risk factors from those~~ disclosed in ~~“Item 1A.~~Part I, Item 1A, Risk ~~Factors”~~Factors of the Form 10-K, ~~Form 10-Q, and other reports that we have~~which was filed with the ~~SEC.~~Securities and Exchange Commission on February 21, 2024. Any of the risks discussed in such ~~reports,~~report, as well as additional risks and uncertainties not currently known to us or that we currently deem immaterial, could materially and adversely affect our results of operations, financial condition or prospects.

We have not been in compliance with the requirements of the NASDAQ Stock Market for continued listing and if NASDAQ does not concur that we have adequately remedied our non-compliance, our common stock may be delisted from trading on NASDAQ, which could have a material adverse effect on us and our shareholders.

On March 24, 2023, the Company received a written notice from The NASDAQ Stock Market (“Nasdaq”) that, because the closing bid price for the Company's common stock had fallen below $1.00 per share for 30 consecutive business days, the Company no longer complies with the minimum bid price requirement for continued listing on the Nasdaq Global Select Market.

Nasdaq's notice has no immediate effect on the listing of the Company's common stock on the Nasdaq Global Select Market. Pursuant to Nasdaq Marketplace Rule 5810(c)(3)(A), the Company has been provided an initial compliance period of 180 calendar days, or until September 20, 2023, to regain compliance with the minimum bid price requirement. To regain compliance, the closing bid price of the Company's common stock must meet or exceed $1.00 per share for a minimum of 10 consecutive business days prior to September 20, 2023.

If the Company does not regain compliance by September 20, 2023, the Company may be eligible for an additional grace period if it applies to transfer the listing of its common stock to the Nasdaq Capital Market. To qualify, the Company would be required to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of the minimum bid price requirement, and provide written notice of its intention to cure the minimum bid price deficiency during the second compliance period by effecting a reverse stock split if necessary. If the Nasdaq staff determines that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible for such additional compliance period, Nasdaq will provide notice that the Company's common stock will be subject to delisting. The Company would have the right to appeal a determination to delist its common stock, and the common stock would remain listed on the Nasdaq Global Select Market until the completion of the appeal process.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

On May 2, 2023, (1) South Ocean Funding, LLC and North Sound Ventures, LP (the “Participants”) collectively purchased a $4.0 million last-out subordinated participation interest in the Credit Agreement (the “Participation Interest”) from the Lender pursuant to a Participation Agreement between the Participants and the Lender (the “Participation Agreement”), and (2) the Borrowers entered into an amendment to the Credit Agreement which increased the borrowing base under the Credit Facility by $4.0 million, increased the minimum draw to $8.5 million, and modified certain covenants. In connection with the purchase of the Participation Interest, we agreed to pay the Participants an exit fee upon the earlier of (a) the scheduled maturity date of the Credit Agreement, (b) the termination of the Lender’s commitment to make revolving loans prior to the scheduled maturity date of the Credit Agreement, and (c) the early redemption of the Participants’ Participation Interest under the Participation Agreement (the earliest to occur of the foregoing, the “Exit Event”). The aggregate exit fee payable to the Participants is equal to (i) 7.5% of the Participation Interest, if the Exit Event occurs on or before December 31, 2023, (ii) 10.0% of the Participation interest, if the Exit Event occurs between January 1, 2024 and June 30, 2024 and (iii) 12.5% of the Participation Interest, if the Exit Events occurs after June 30, 2024. Further, the purchase of the Participation Interest granted an option for the Participants to purchase the subject revolving loan or to redeem its Participation Interest under certain circumstances. South Ocean Funding, LLC is an affiliate of Golden Harbor, Ltd. and North Sound Ventures, LP is an affiliate of North Sound Management, Inc. As of the date hereof, each of Golden Harbor, Ltd. and North Sound Management, Inc. hold in excess of 5% of the Company’s outstanding common stock. James Avery, a member of our Board of Directors, currently serves as Senior Managing Director of Tavistock Group, an affiliate of South Ocean Funding, LLC.

~~The foregoing summary is qualified in its entirety by the complete text of the Amendment to Loan and Security~~

~~Agreement and the Exit Fee Letter Agreement, filed as Exhibits 10.2 and 10.3, respectively, to this Form 10-Q.~~None.

3026

Item 6. Exhibits.


Exhibit No.						Description

3.1						Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed November 9, 2016).
3.2						Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed November 9, 2016).
3.3						Certificate of Designation of Series E Fixed-Rate Cumulative Perpetual Preferred Stock filed with the Secretary of State of the State of Delaware on August 8, 2019 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed August 13, 2019).
3.4						Certificate of Amendment to Certificate of Designation of Series E Fixed-Rate Cumulative Perpetual Preferred Stock (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed March 10, 2020).



10.1						Fourth Amendment, dated as of ~~December 15, 2022,~~February 8, 2024, to Loan and Security Agreement, dated as of August 5, 2022, among Siena Lending Group LLC (as Lender), Inseego Wireless, Inc., and Inseego North America LLC (as Borrowers), and Inseego Corp. (as Guarantor) (incorporated by reference to Exhibit ~~10.20~~10.1 to the ~~Registrant’s~~Company’s Current Report on Form ~~10-K,~~8-K, filed ~~on May 3, 2023)~~February 21, 2024).
~~10.2~~						~~Amendment, dated as of~~ ~~May 2, 2023, to Loan and Security Agreement, dated as of August 5, 2022~~as amended by that certain First Amendment to Loan and Security Agreement dated as of December 15, 2022, as amended by that certain Second Amendment to Loan and Security Agreement dated as of April 28, 2023 (as may be further amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”)~~, among Siena Lending Group LLC (as Lender), Inseego Wireless, Inc., and Inseego North America LLC (as Borrowers), and Inseego Corp. (as Guarantor)~~.
~~10.3~~						~~Exit Fee Letter Agreement, dated May 2, 2023, between Inseego Wireless, Inc., South Ocean Funding, LLC, and North Sound Ventures, LP.~~
31.1*						Certification of our Principal Executive Officer adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*						Certification of our Principal Financial Officer adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1#						Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2#						Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS						Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH						Inline XBRL Taxonomy Extension Schema Document.
101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104						Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

*						Filed herewith.
#						Furnished herewith

3127

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: May ~~4, 2023~~9, 2024

Inseego Corp.

By:

/s/ ~~ASHISH SHARMA~~PHILIP BRACE

~~Ashish Sharma~~Philip Brace

~~Chief~~ Executive ~~Officer~~
Chairman

By:

/s/ ~~ROBERT G. BARBIERI~~STEVEN GATOFF

~~Robert G. Barbieri~~Steven Gatoff

Chief Financial Officer

3228


	Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit 1		Accumulated Other Comprehensive Income (Loss) 1		Total Stockholders’ Equity (Deficit)
	Shares	Amount		Shares	Amount
Balance, December 31, 2021	25	$	—	105,381	$	105	$	770,619	(787,047)		$	(8,531)	$	(24,854)
Net loss	—	—		—	—		—		(25,223)		—		(25,223)
Foreign currency translation adjustment	—	—		—	—		—		—		2,898		2,898
Adjustment relating to extinguishment of 2022 Notes	—	—		—	—		1,728		—		—��		1,728
Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan	—	—		2,008	2		74		—		—		76
Taxes withheld on net settled vesting of restricted stock units	—	—		—	—		(14)		—		—		(14)


Share-based compensation	—	—		—	—		11,199		—		—		11,199

Series E preferred stock dividends	—	—		—	—		661		(661)		—		—

Balance, March 31, 2022	25	$	—	107,389	$	107	$	784,267	$	(812,931)	$	(5,633)	$	(34,190)

Balance, December 31, 2022	25	$	—	108,468	$	108	$	793,855	$	(857,752)	$	(6,329)	$	(70,118)
Net loss	—	—		—	—		—		(5,104)		—		(5,104)
Foreign currency translation adjustment	—	—		—	—		—		—		94		94

Exercise of stock options, vesting of restricted stock units and stock issued under employee stock purchase plan	—	—		46	—		96		—		—		96
Taxes withheld on net settled vesting of restricted stock units	—	—		—	—		(21)		—		—		(21)
Issuance of common shares in connection with a public offering, net of issuance costs				858	1		528						529
Share-based compensation	—	—		—	—		1,800		—		—		1,800
Series E preferred stock dividends	—	—		—	—		723		(723)		—		—

Balance, March 31, 2023	25	$	—	109,372	$	109	$	796,981	$	(863,578)	$	(6,236)	$	(72,724)


	March 31, 2023 1		December 31, 2022

Rebate receivables	$	1,905	$	2,038
Receivables from contract manufacturers	4,014		3,561
Software licenses	1,079		772
Insurance	11		12
Deposits	619		829
Financed assets	1,355		—
Other	993		766
Total prepaid expenses and other	$	9,977	$	7,978


	Balance Sheet Classification	March 31, 2023			December 31, 2022
Operating right-of-use assets, net	Right-of-use assets	$	6,122		$	6,662

Current operating lease liabilities	Accrued expenses and other current liabilities	$	1,814		$	1,759
Non-current operating lease liabilities	Other long-term liabilities	5,149			5,903
Total operating lease liabilities		$	6,963		$	7,662

Weighted-average remaining lease term (in years)		4.0			4.1
Weighted-average discount rate		9.0		%	9.0		%


2023 (remainder)	$	1,687
2024	2,090
2025	1,734
2026	1,707
2027	1,125

Thereafter	—
Total minimum operating lease payments	$	8,343
Less: amounts representing interest	(1,380)
Present value of net minimum operating lease payments	6,963
Less: current portion	(1,814)
Long-term portion of operating lease obligations	$	5,149