u-blox turns attention towards Global Navigation Satellite System (GNSS) solutions, discontinues cellular operations
u-blox Announces Sale of Cellular Business and Focus on Locate Business
Swiss technology company u-blox has announced that it will be divesting its Cellular business, marking a deliberate pivot towards specialized Locate technologies. The sale, which is part of a broader strategic restructuring aimed at improving profitability and focusing on higher-margin markets, generated CHF 100.7 million in cash.
The Locate business includes autonomous vehicles, industrial IoT, and tracking applications. By refocusing investment and resources on precision positioning and automation technologies, u-blox aims to better capitalize on trends such as autonomous vehicle navigation and industrial automation.
The decision to exit the Cellular business is expected to eliminate at least CHF 30 million EBIT annual losses. Strengthening operational efficiency and margin expansion through cost-cutting and streamlining, including an 18% reduction in SG&A expenses in H1 2025, will further support this goal.
The first savings from the cost optimisation program will be reflected in the P&L in H2 2024, with the full effect expected in H1 2025. The majority of the cost reduction actions are expected to be executed in 2025. However, there will be a one-time non-cash negative EBIT impact of CHF 31 million in Q4 2024 from intangible assets impairment (capitalized R&D).
The transition will result in a one-time negative EBIT impact of around CHF 65 million in Q1 2025 from restructuring. Approximately 40% of this impact is cash. u-blox has confirmed its Q4 2024 revenue guidance of CHF 60-70 million and EBIT margin (-25% to -15%).
To discuss the phase out of its Cellular business, u-blox will host a Q&A session today, 14 January 2025, at 14:00 CET. To register for the Q&A session, visit the webcast registration page.
The phase-out of the Cellular business is expected to reinforce u-blox's position as a premier provider of world-class location solutions. The adjusted EBIT loss for the Cellular business in H1 2024 exceeded CHF 15 million.
The global Cellular modems market is expected to experience significant growth through 2033 driven by 4G/5G and IoT adoption. However, u-blox’s choice to exit this business underscores its strategic priority to dominate precision positioning for automotive and industrial IoT markets, where it sees stronger long-term value.
u-blox has built strategic partnerships to enhance its Locate business offerings in automation and smart industries, such as with NVIDIA for AI-based GNSS solutions. The company anticipates eliminating at least CHF 30 million EBIT annual losses with this decision, improving financial health and flexibility with CHF 100 million net cash availability to support growth in the Locate segment.
In summary, u-blox’s sale of its Cellular business marks a deliberate pivot from connectivity hardware toward specialized Locate technologies that support autonomous vehicles and industrial IoT applications, aligning with its goal of operational efficiency and growth in high-margin segments.
[1] u-blox Press Release, 14 January 2025. [2] u-blox Annual Report 2024. [3] u-blox Investor Relations, 14 January 2025. [4] MarketsandMarkets, Global Cellular Modems Market Size, Share, Trends, and Growth Analysis, 2020-2030.
- u-blox aims to leverage its investment in the Locate business, which includes autonomous vehicles, industrial IoT, and tracking applications, to capitalize on trends such as autonomous vehicle navigation and industrial automation, a deliberate move away from the Cellular business.
- By exiting the Cellular business, u-blox expects to eliminate at least CHF 30 million EBIT annual losses, allowing the company to focus on higher-margin markets and strengthen its operational efficiency, ultimately improving its financial health and flexibility.
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