u-blox’s H1 2023 Jumps 17% YoY, Expects Slowdown in H2

  • Results driven by design wins in the automotive and industrial application sectors.
  • EMEA had the highest growth in revenue at 31% YoY and surpassed the Americas in terms of contribution.
  • u-blox to experience a reduction in revenue in Q3 2023 and remain sluggish in H2 2023.

Global wireless and positioning technologies leader u-blox’s H1 2023 revenue rose 17% YoY to reach $364.3 million, primarily driven by successful design wins within the automotive and industrial application sectors. However, gains were limited by a decline in consumer revenue.

During u-blox’s earnings call, CEO Stephan Zizala touched upon several important topics like significant design wins, prevailing macroeconomic challenges, and the company’s proactive management strategy for the future.

Macroeconomic Situation and Outlook

CEO: “In a softening macroeconomic and global semiconductor market environment, our order book for H2 2023 developed more slowly than initially anticipated. Mainly due to unfavorable FX rates and overstocking, we expect Q3 revenues and profitability to be weak, with an improvement in Q4.”

Our analyst take: “The IoT module industry is decelerating because of broader macroeconomic conditions and a softening semiconductor market. Key players in the cellular IoT module sector, including Quectel and Telit Cinterion, have witnessed a reduction in growth compared to H1 2022. However, during H1 2023, u-blox achieved significant double-digit expansion, despite significant constraints from the global semiconductor supply chain shortage.”

“However, u-blox is expected to experience a reduction in revenue in Q3 2023 as demand remained weak in the key North American region during H1 2023 and will likely remain sluggish in H2 2023. However, u-blox is optimistic about Q4.”

u-blox revenue by application, H1 2019 - H1 2023Management Strategy

CEO: “While we must deal with cycle adaptation, I remain very confident about u-blox’s long-term outlook and growth trajectory, thanks to our strong structural growth drivers in automotive and industrial target applications. We are winning important new projects at leading customers. A large design win for automated driving ramping in 2026 and an innovative approach for satellite IoT connectivity are testimony to these future development prospects.”

Our analyst take: “The automotive industry is undergoing a significant transformation towards electrification and autonomy. This transition highlights the importance of connectivity and navigation, emerging as crucial factors. u-blox stands out from other GNSS competitors due to its exceptional GNSS quality and centimeter-level precision in positioning.”

“Apart from its focus on GNSS and cellular technology, u-blox’s recent collaborations with satellite player Orbcomm leverage its strides toward present-day trends. The aim is to offer hybrid connectivity solutions (combining cellular and satellite capabilities) catering to agriculture, asset tracking, and maritime applications, promising enhanced coverage and communication. However, u-blox is set to encounter intense competition from Quectel, Fibocom, and Telit Cinterion, as they have already introduced hybrid connectivity modules.”H1 2023 Highlights:

  • u-blox’s gross profit increased 12% YoY in H1 2023 to reach $171 million.
  • The industrial sector accounted for 65% of the total company revenue and experienced a robust 26% YoY growth. This growth was attributed to significant demand in asset tracking applications.
  • The automotive segment also exhibited growth, increasing 24% YoY and accounting for 30% to the overall revenue, driven by the acceleration of electric vehicle adoption and advancements in autonomy.
  • Conversely, the consumer and other segments faced a decline of 55% YoY, accounting for only 5% of the total revenue. This decline was primarily driven by decreased consumer demand starting from mid-2022.
  • Among regions, APAC was the highest contributor, capturing 43% of the market with 30% YoY growth due to demand from automotive customers and safety stock buildup for healthcare customers. EMEA shows the highest growth with 31% YoY and contributed 32% of the market surpassing Americas with a ramp-up of the tracking business and 2022 order backlog. However, the US region’s revenue fell 12% YoY, accounting for only 25% of the market due to demand reduction in healthcare and consumer applications.
  • In H1 2023, modules and chips accounted for 80% and 19% of the total revenue, respectively. Module volume grew 9% YoY growth in H1 2023, while chip volume saw a remarkable increase of 31% YoY.
  • In the module revenue segment, the GNSS module retained its leading position, generating over half of the total revenue. This is attributed to the exceptional quality and precision of u-blox’s GNSS products. The collaboration with GMV resulted in significant design wins, merging u-blox’s GNSS receiver hardware with GMV’s secure correction service, sensor fusion and positioning engine. Furthermore, u-blox has partnered with Position Partners to introduce the PointPerfect GNSS augmentation service to Victoria and New South Wales. This marks the initial phase of the service’s rollout within the Australian and New Zealand markets.
  • In H1 2023, the Wi-Fi/BT module segment grew 10% YoY. u-blox’s latest release, the JODY-W5, introduced the newest dual-band Wi-Fi 6 and dual-mode Bluetooth® 5.3 module, featuring Bluetooth LE audio within a compact form factor. This design is aimed at preventing wireless network congestion within vehicles while simultaneously enhancing audio capabilities.
  • According to Counterpoint Research’s Cellular IoT Module Tracker service, u-blox’s cellular IoT module segment grew 18% YoY in H1 2023 to reach $106 million. u-blox has accelerated its adoption of tracking applications driven by the strong performance of its UBX-R5 chipset-based LPWA and LTE-M modules.


Given the macroeconomic challenges characterized by adverse shifts in FX rates and customer overstocking, u-blox’s market outlook for H2 2023 suggests a substantial deceleration. The rise in inventory levels is expected to lead to a decrease in profitability during Q3 2023, followed by a recovery in Q4 2023. However, the demand and requirements for semiconductor solutions, particularly in domains such as autonomous driving, asset tracking and industrial automation, are poised for substantial growth. u-blox remains strategically positioned to capitalize on this growth trend due to its strong expertise in positioning technology and wireless connectivity, which is expected to result in more design wins.

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PAX’s H1 2023 Revenue Down 15% YoY as E-payment Terminal Business Hurt by Unfavourable Macroeconomics

  • Revenue contribution from LACIS, EMEA and APAC regions drop YoY in H1 2023.
  • Revenue contribution from APAC region should improve in H2 2023 with India and SEA’s strengthening performances.
  • PAX expects a double-digit percentage decline in 2023 revenue.

PAX Global Technology’s H1 2023 revenue fell 14.7% YoY to $456 million, as the company’s electronic payment terminal business was constrained by slowing global economic growth and high-interest rates. Meanwhile, revenue from its payment terminal-related services segment surged 35.6% YoY during the period, mainly due to the growth in revenue generated from the Software as a Service (SaaS) solutions, maintenance, and installation services.

PAX revenue by segment

During PAX’s earnings call, CEO Jack Lu discussed a few key topics including the adoption of Android smart solutions, macroeconomic challenges and forward-going management strategies.

Macroeconomic Situation and Payment Trend

CEO Jack Lu: “Despite short-term macroeconomic challenges, the proliferation of electronic payments continues to be a significant and ongoing global trend. The continued advancement of payment technology, along with growing consumer appetite for convenient and secure payment options, as well as the cashless initiatives promoted by governments worldwide, have continued to open up new opportunities for PAX solutions.”

Our analyst take: “PAX’s strong portfolio across different sectors, combined with its POS terminal management platform, offers a one-stop solution for businesses. PAX is helping businesses scale their operations by providing seamless payment options. The company has strategically set up a dedicated division called Zolon to expand business Internet of Things (BIoT). PAX’s service segment revenue is expected to receive a further boost from its BIoT solutions, including SaaS (e.g. MAXSTORE) and commercial POS solutions (e.g. Elys). The enterprise IoT solution will mainly target cloud-based services for businesses to secure recurring revenues.”

Management Strategy

CEO Jack Lu: “Looking ahead, the global payment industry continues to embrace a prosperous future. PAX will continue to explore more potential business opportunities by acquiring banks, PSPs and distribution partners, offering future-oriented payment solutions for merchants and consumers across the globe.”

Our analyst take: “The payment industry has undergone fundamental changes in recent years, with a surge in the global acceptance of electronic payment options among consumers and merchants. Governments and financial institutions worldwide now place greater emphasis on their electronic payment acceptance infrastructure and are aiming to implement a more efficient and transparent financial ecosystem. The huge value and potential of the payment terminal market will be further unlocked going forward. PAX’s ongoing strategy is aligned to capture this huge market opportunity and we believe its expanding global presence and increasing investment in R&D will help it drive innovation and increase market share.”

PAX revenue by region

H1 2023 Result Summary:

  • PAX reported gross profit margin of 44% in H1 2023, up 400 bps YoY, driven by lower costs stemming from a weaker yuan and a change in its geographical sales mix. PAX’s SaaS ecosystem rose 84% YoY in H1 2023 and contributed positively to the company’s overall revenue growth. The company had more than 10 million connected terminals being managed on its MAXSTORE platform during the period.
  • In H1 2023, PAX registered a decline in revenue from the Latin America and Commonwealth of Independent States (LACIS), Europe, Middle East and Africa (EMEA) and Asia-Pacific (APAC) Only the United States and Canada (USCA) region saw a record-breaking growth of 20% YoY during the period.
  • The LACIS region posted an 18% YoY decline in H1 2023 revenue to reach $175 million, constrained by the conservative business sentiment in Brazil stemming from challenging economic
  • The EMEA region recorded $148 million in revenue, down 19% YoY in H1 2023, mostly due to economic uncertainties, especially in Europe and the Gulf Cooperation Council (GCC), resulting in a temporary slowdown in market demand. However, PAX is confident that its strong brand recognition and products, as well as a reputable network of channel partners, will continue to positively influence growth in the region.
  • The APAC region saw a 24% YoY decline in revenue to $57 million, hurt by the longer-than-expected sales cycle in India, which offset the growth of other markets in the region. However, going forward, several APAC countries are expected to contribute increased sales revenues as PAX’s brand recognition improves and new products hit the market.
  • During H1 2023, PAX secured a steady increase in shipment volumes from the SEA region as countries like Indonesia and Singapore ramped up the adoption of PAX Android smart products as they move to modernize their electronic payment systems. Riding on this wave, along with India’s strengthening contribution, the APAC region should perform well in H2 2023.
  • The USCA region registered a record-breaking growth of 20% YoY in H1 2023 with $76 million in revenue, mostly driven by increasing market demand for diverse payment options and value-added services. PAX Smart Android solutions have maintained strong sales momentum and positive market reception of the newly launched Elys Solution.
  • In July 2023, PAX was elected to the Board of Advisors of the PCI Security Standards Council (PCI SSC), making it the first and only Chinese company to join the board – this proves how good its products are. PAX should leverage the PCI SSC news to keep gaining market share in the US and Europe.
  • PAX’s expertise in Android SmartPOS technology has enabled it to lead the Android SmartPOS solutions space. However, it faces strong competition in other use cases and form factors from international players like Ingenico and Verifone and homegrown Chinese players like Newland, Tianyu and Castles.
  • With an unwavering dedication to the payment terminal sector for the past two decades, PAX has built extensive expertise, capital prowess and a diversified global footprint supported by a strong portfolio across different sectors catering to different needs of merchants and businesses. This has helped PAX become risk resilient and adaptable to volatile environments.
  • PAX has a bleak outlook for 2023, given the macroeconomic obstacles, decelerating global economic growth, and elevated interest rates. The company has anticipated a double-digit percentage decrease in revenue for the year. Similarly, competitors like Newland, Tianyu and Castles are also grappling with these macroeconomic challenges for their payment terminal businesses.

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Advance Digital Malaysia – Competing for Innovation and Investment in a Global 5G Economy

Our Senior Analyst Glen Cardoza will be speaking at the Advance Digital Malaysia webinar on December 14th 2021.  The topic of the panel discussion is “Competing for Innovation and Investment in a Global 5G Economy”.

Session details: Tuesday | 14 December 2021 | 16:00-18:00 (Malaysia Standard Time GMT +8)

About the webinar:

Leading 5G economies are being built on innovation ecosystems solving problems or developing new business opportunities that create economic value beyond national borders. Digital society maturity, mobile broadband adoption and network coverage are basic ingredients for an innovation ecosystem but competition for investment, talent and success requires nurturing favorable assets and a whole of government strategy to be a leader. Past generations of mobile technology have relied on infrastructure competition as a foundation for innovation. This webinar brings together global experts and stakeholders to debate Malaysia’s challenges to create a vibrant and competitive innovation ecosystem to support its 5G nation leadership ambitions.

This webinar will focus on three areas:

  1. Principles and policies to create national innovation ecosystem competitive advantage
  2. Relative importance of infrastructure competition in 5G technology, network deployment and use case innovation
  3. What are the pioneer use cases for ASEAN region

Registration link: 


To get live updates from the event you can watch this space or follow us on Twitter .

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