u-blox Continues Strong Growth in H1 2022

u-blox recorded an excellent H1 2022 with $311.9 million in total revenues, an increase of 47% from H1 2021 despite macroeconomic headwinds. The demand and interest in u-blox products remained strong across all markets and business segments. The strategy of remodeling and redesigning its products has worked for u-blox in dealing with specific shortages. This time, u-blox changed module design a lot to cut component shortages and clear backlogs.

H1 2022 highlights

  • u-blox’s gross profit increased 53.9% YoY in H1 2022 to reach $152.4 million.
  • The industrial segment captured 61% of the company’s total revenue and grew 62% YoY due to higher demand for automation and healthcare applications. The automotive segment also grew 62% YoY and its revenue contributed 28% to the total revenue. The consumer segment grew 18% YoY and captured 10% of the total revenue. In this segment, the growth mainly came from consumer telematics applications.
  • Americas and APAC regions grew more than 50% YoY while EMEA grew 30%. This growth was driven by industry-focused solutions for automation, mobility, healthcare and network applications. APAC’s growth despite China lockdowns was a testament to u-blox’s strong pipeline of design wins.
  • In the first half of 2022, modules and GNSS chips contributed 81% and 18% of the total revenue respectively. The module volume grew by 34.3% YoY in H1 2022 to reach nearly 27 million.

The ASP of modules and chipsets increased 20% and 46% YoY respectively due to supply chain constraints and product mix-ups.

u-blox H1 2022 financials, Counterpoint

GNSS modules

u-blox’s GNSS module shipments grew 56% YoY in H1 2022, contributing more than half of the total module revenue. The good quality and position accuracy of its GNSS products helped u-blox grow this market significantly. This year, it launched the smallest GNSS module, MIA-M10, with its latest technology targeting size-constrained applications like asset-tracking devices, pet trackers, livestock trackers and wearables. Xiaoan selected the u-blox M10 product to enhance the positioning performance of shared motorcycles and electric bicycles.

Wi-Fi/BT modules

In H1 2022, u-blox’s Wi-Fi/BT module segment grew 24% YoY to reach a revenue of nearly $30 million. In short-range radio modules (Wi-Fi and Bluetooth), u-blox continued to expand its capabilities. It launched Wi-Fi 6-based modules, which are ideal for industrial, smart home and mass-market applications.

Cellular IoT modules

In recent times, we have seen international module players merging their cellular IoT businesses to become more competitive in this space. u-blox is slowly recovering its cellular IoT module business. In H1 2022, u-blox’s cellular IoT module segment grew 36% compared to H1 2021, according to Counterpoint Research’s Cellular IoT Module Tracker Service. u-blox provided flexibility to its customers by launching new products. However, we expect u-blox will focus more on GNSS products and services compared to cellular IoT modules, considering growth opportunities.

GNSS chips

The quality of u-blox’s GNSS chipsets is far better than other players, which is helping u-blox witness continued growth in this market. With the rising demand for positioning and location-based ecosystems, u-blox will be able to record a multi-fold increase in its revenue by targeting applications like passenger and commercial vehicles, asset tracking, micro-mobility, surveillance, industrial and healthcare.

Market outlook

The steady expansion of u-blox’s production capacity and strong bookings resulted in this record revenue in H1 2022. Within the first half of 2022, its order book value doubled compared to the end of 2021, which makes u-blox well-positioned to continue to grow revenues and improve profitability. It is already managing well the supply constraint situation. We expect u-blox’s revenue will grow nearly 50% YoY in 2022.

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