Struggling Sequans suspends its 5G fixed wireless project

Following the collapse of Renesas' plans to purchase Sequans in a $249 million deal, Sequans has also shuttered work on its 5G product for fixed wireless services.

Mike Dano, Editorial Director, 5G & Mobile Strategies

June 18, 2024

3 Min Read
 IoT Internet of Things technology with connected devices exchanging data on network
(Source: NicoElNino/Alamy Stock Photo)

Sequans Communications said it will halt work on its 5G fixed wireless effort, dubbed Taurus, and will instead pivot to developing 5G products centered on RedCap and eRedCap IoT technologies. 

The move comes several months after Japan's Renesas Electronics dropped its $249 million plan to acquire Sequans, a transaction first announced last year.

"This [5G] shift is expected to significantly reduce R&D expenses as part of the company's plan to achieve break-even in 2025," Sequans wrote in a release this week.

RedCap is a flavor of the 5G standard intended for IoT services. Other companies including Fibocom and Telit make RedCap modules for IoT services.

Sequans' business is currently centered on building 4G IoT modules. The company first announced its Taurus 5G effort roughly a year ago. During the company's most recent earnings call in March, company officials said they expected to begin shipping 5G Taurus products in late 2025, after sampling the offering with customers later this year. 

In Sequans' most recent financial report, the company reported $26.1 million in research and development expenses during 2023, in part due to its 5G project.

Overall, France-based Sequans reported revenue of $6 million in the first quarter, an increase of 26% compared to the fourth quarter of 2023 and a decrease of 49% compared to the first quarter of 2023. 

Company officials this week touted a new $15 million licensing agreement for its Monarch2 platform with an unnamed customer.

Sequans also this week announced another "standstill" agreement with its debt holders through August, after announcing a similar pause in April.

The context

Sequans is one of many companies undergoing upheaval in the IoT sector. As revenues in the space shrink, a wide variety of players are consolidating. The latest: Sweden's Netmore said in February it would acquire LoRa network operator Senet, which is based in Portsmouth, New Hampshire.

Other transactions in the space include Kore's purchase of Twilio's IoT business, Ericsson's sale of its IoT Accelerator and Connected Vehicle Cloud businesses to Aeris, Telit's acquisition of Thales' cellular IoT business, Semtech's acquisition of IoT vendor Sierra Wireless and Telit Cinterion's deal for Thales' IoT business.

To be clear, the IoT sector of the cellular industry isn't the only one to suffer a slowdown. Giant equipment vendors like Ericsson and Nokia also have been shedding staff amid a spending slowdown among operator customers.

Further, wireless network operators themselves have been working to shore up their finances as 5G offerings fail to spark a rise in revenues.

About the Author(s)

Mike Dano

Editorial Director, 5G & Mobile Strategies, Light Reading

Mike Dano is Light Reading's Editorial Director, 5G & Mobile Strategies. Mike can be reached at [email protected], @mikeddano or on LinkedIn.

Based in Denver, Mike has covered the wireless industry as a journalist for almost two decades, first at RCR Wireless News and then at FierceWireless and recalls once writing a story about the transition from black and white to color screens on cell phones.

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like