6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 under the Securities Exchange Act of 1934

For the month of April 2021

Commission File Number: 001-35135

Sequans Communications S.A.

(Translation of Registrant’s name into English)

15-55 boulevard Charles de Gaulle

92700 Colombes, France

Telephone : +33 1 70 72 16 00

(Address of Principal Executive Office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F: Form 20-F R Form 40-F £

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): Yes £ NoR

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): Yes £ NoR

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

The information in this report, furnished on Form 6-K, excluding the section titled “Q2 2021 Outlook”,

shall be incorporated by reference into each of the following Registration Statements under the Securities Act of 1933, as amended, of the registrant: Form S-8 (File Nos. 333-177919, 333-180487, 333-187611, 333-194903, 333-203539, 333-211011, 333-214444, 333-215911, 333-219430, 333-226458, 333-233473 and 333-239968) and Form F-3 (File No. 333-250122).

EXPLANATORY NOTE

On April 27, 2021, Sequans Communications S.A. issued a press release announcing its financial results for the quarter ended March 31, 2021. A copy of the press release is attached to this Form 6-K as Exhibit 99.1 and is incorporated herein by reference.

EXHIBIT INDEX

The following exhibit is filed as part of this Form 6-K:

Exhibit	Description
99.1	Press release dated April 27, 2021

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.

	SEQUANS COMMUNICATIONS S.A.<br><br>(Registrant)
Date: April 27, 2021	By:	/s/ Deborah Choate
		Deborah Choate
		Chief Financial Officer

Document

NEWS

Sequans Communications Announces

First Quarter 2021 Financial Results

PARIS - April 27, 2021 - Sequans Communications S.A. (NYSE: SQNS), a leading developer and provider of 5G/4G chips and modules, today announced financial results for the first quarter ended March 31, 2021.

First Quarter 2021 Summary Results Table:

(in US$ millions, except share and per share data)	Q1 2021	Q4 2020	Q1 2020
Revenue	12.3	15.8	8.8
Gross profit	6.2	7.1	4.5
Gross margin (%)	50.1	45.1	51.3
Operating loss	(5.8)	(5.4)	(7.8)
Net loss	(11.4)	(11.3)	(15.3)
Diluted earnings per ADS	(0.33)	(0.36)	(0.64)
Non-IFRS diluted earnings per ADS (1)	(0.15)	(0.28)	(0.36)
Weighted average number of diluted ADS	34,664,779	31,044,769	23,904,935
(1) See Use of Non-IFRS/non-GAAP Financial Measures disclosure on page 3

All values are in US Dollars.

"First quarter revenue grew by 40% year-over-year driven by significant gains in Massive IoT. Sequans continued to see strong momentum in our product revenue pipeline and design wins, particularly from solid demand in Massive IoT." said Georges Karam, CEO of Sequans. "On a sequential basis, our seasonally slower first quarter revenue was also impacted by supply chain constraints that delayed approximately $2 million of shipments, and the anticipated decline in demand for the modem we supply for the Verizon Jetpack. We continue to execute our long-term growth strategy on three fronts – continued growth in Massive IoT and CBRS IoT, expansion of our go-to-market channels, and ongoing development of our 5G product line. We remain committed to delivering our first 5G NR solution in 2022 and entering the next growth phase for our company."

Q2 2021 Outlook

The following statement is based on management’s current assumptions and expectations and assumes no increase in the severity or duration of the COVID-19 pandemic. This statement is forward-looking and actual results may differ materially.

Despite the continued supply chain constraints for materials, and factoring in the risk related to the portable router business, management is targeting a 10% sequential increase in revenue.

First Quarter 2021 Financial and Operational Results Summary

Revenue for the first quarter was $12.3 million, a decrease of 22.0% compared to the fourth quarter of 2020 and an increase of 40.5% compared to the first quarter of 2020. The decrease from the prior fourth quarter was primarily due to the seasonally slower first quarter combined with delayed shipments related to supply chain constraints, while the increase in revenue year-over-year was primarily due to product shipments in the Massive IoT market.

Gross profit for the first quarter of 2021 was $6.2 million, a decrease from the prior quarter gross profit of $7.1 million and an increase from the prior year first quarter of $4.5 million. Gross margin for the first quarter of 2021 was 50.1% compared to 45.1% in the fourth quarter of 2020 and 51.3% in the first quarter of 2020. The sequential improvement in gross margin was primarily due to the increase in the product revenue mix from chip sales.

Operating loss was $5.8 million compared to $5.4 million in the fourth quarter of 2020 and $7.8 million in the first quarter of 2020. The year-over-year decline in operating loss was primarily due to the increase in revenue and a slight reduction in operating expenses.

Net loss was $11.4 million, or ($0.33) per diluted ADS, compared to $11.3 million, or ($0.36) per ADS, in the fourth quarter of 2020 and $15.3 million, or ($0.64) per ADS, in the first quarter of 2020.Net loss in the first quarter of 2021 includes a non-cash charge resulting from the change in the remaining embedded derivative fair value associated with the Company’s convertible notes, which includes the change in value of the tranches of convertible notes converted through their conversion dates, partially offset by a foreign exchange gain related to the revaluation of euro liabilities in the quarter.

Sequans reports first quarter 2021 financial results

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Non-IFRS Net loss and diluted loss per ADS: Excluding the non-cash stock-based compensation, the non-cash impact of the fair-value and effective interest adjustments related to the convertible debt with embedded derivatives and other financings, the non-cash impact of convertible debt amendments, and deferred tax benefit or expense related to the convertible debt and other financings, non-IFRS net loss was $5.1 million, or ($0.15) per ADS, compared to $8.5 million, or ($0.28) per ADS in the fourth quarter of 2020, and $8.7 million, or ($0.36) per ADS, in the first quarter of 2020. The non-IFRS net loss includes foreign exchange gain of $1.4 million, or $0.04 per ADS, in the first quarter of 2021, versus a foreign exchange loss of $1.9 million, or ($0.06) per ADS, in the fourth quarter of 2020 and a foreign exchange gain of $0.7 million, or $0.03 per ADS, in the first quarter of 2020.

Cash: Cash, cash equivalents and short-term deposits at March 31, 2021 totaled $13.5 million compared to $18.5 million at December 31, 2020. The balance at March 31, 2021 excludes the $50 million of proceeds from the hybrid equity and convertible debt financing closed on April 9, 2021 and the $1.7 million in proceeds from a government grant received April 1, 2021, as well as the repayment of $18.8 million in convertible notes and other debt on April 14, 2021 and April 15, 2021.

Conference Call and Webcast

Sequans plans to conduct a teleconference and live webcast to discuss the financial results for the first quarter of 2021 today, April 27, 2021 at 8:00 a.m. ET /14:00 CET. To participate in the live call, analysts and investors should dial 877-407-0792 or +1 201-689-8263 if outside the U.S. When prompted, provide the event title or access code: 13718024. A live and archived webcast of the call will be available from the Investors section of the Sequans website at www.sequans.com/investors/. An audio replay of the conference call will be available until May 11, 2021 by dialing toll free 844-512-2921 or +1 412-317-6671 from outside the U.S., using the following access code:13718024.

Forward Looking Statements

This press release contains projections and other forward-looking statements regarding future events or our future financial performance and potential financing sources. All statements other than present and historical facts and conditions contained in this release, including any statements regarding future results of operations and financial positions, business strategy and plans, expectations for Massive IoT and Broadband and Critical IoT sales, the impact of the coronavirus on our manufacturing operations, supply chain, and on customer demand, the impact of component shortages and manufacturing capacity, and our objectives for future operations, are forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). These statements are only predictions and reflect our current beliefs and expectations with respect to future events and are based on assumptions and subject to risk and uncertainties and subject to change at any time. We undertake no obligation to update the information made in this release in the event facts or circumstances subsequently change after the date of this press release. We operate in a very competitive and rapidly changing environment. New risks emerge from time to time. Given these risks and uncertainties, you should not rely on or place undue reliance on these forward-looking statements. Actual events or results may differ materially from those contained in the projections or forward-looking statements. In addition to the risk factors contained in our Form 20-F for the fiscal year ended December 31, 2020, some of the factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: (i) the contraction or lack of growth of markets in which we compete and in which our products are sold, (ii) unexpected increases in our expenses, including manufacturing expenses, (iii) our inability to adjust spending quickly enough to offset any unexpected revenue shortfall, (iv) delays or cancellations in spending by our customers, (v) unexpected average selling price reductions, (vi) the significant fluctuation to which our quarterly revenue and operating results are subject due to cyclicality in the wireless communications industry and transitions to new process technologies, (vii) our inability to anticipate the future market demands and future needs of our customers, (viii) our inability to achieve new design wins or for design wins to result in shipments of our products at levels and in the timeframes we currently expect, (ix) our inability to enter into and execute on strategic alliances, (x) our ability to meet performance milestones under strategic license agreements, (xi) the impact of natural disasters on our sourcing operations and supply chain, (xii) the impact of the coronavirus on the ability to operate our business and research, production of our products or demand for our products by customers whose supply chain is impacted or whose operations have been impacted by government shelter-in-place or similar orders, (xiii) our ability to raise debt and equity financing, and (xv) other factors detailed in documents we file from time to time with the Securities and Exchange Commission.

Use of Non-IFRS/non-GAAP Financial Measures

To supplement our unaudited consolidated financial statements prepared in accordance with IFRS, we disclose certain non-IFRS, or non-GAAP, financial measures. These measures exclude the non-cash stock-based compensation and the non-cash impacts of convertible debt amendments, effective interest adjustments related to the convertible debt with embedded derivatives and other financings, and deferred tax benefit or expense related to the convertible debt and other financings. We believe that these measures can be useful to facilitate comparisons among different companies. These non-GAAP measures have limitations in that the non-GAAP measures we use may not be directly comparable to those reported by other companies. We seek to compensate for this limitation by providing a reconciliation of the non-GAAP financial measures to the most directly comparable IFRS measures in the table attached to this press release.

About Sequans Communications

Sequans reports first quarter 2021 financial results

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Sequans Communications S.A. (NYSE: SQNS) is a leading developer and provider of 5G and 4G chips and modules for IoT devices. For 5G/4G massive IoT applications, Sequans provides a comprehensive product portfolio based on its flagship Monarch LTE-M/NB-IoT and Calliope Cat 1 chip platforms, featuring industry-leading low power consumption, a large set of integrated functionalities, and global deployment capability. For 5G/4G broadband and critical IoT applications, Sequans offers a product portfolio based on its Cassiopeia 4G Cat 4/Cat 6 and high-end Taurus 5G chip platforms, optimized for low-cost residential, enterprise, and industrial applications. Founded in 2003, Sequans is based in Paris, France with additional offices in the United States, United Kingdom, Israel, Hong Kong, Singapore, Finland, Taiwan, South Korea, and China.

Visit Sequans online at www.sequans.com; www.facebook.com/sequans; www.twitter.com/sequans

Media Relations: Kimberly Tassin, +1.425.736.0569, Kimberly@sequans.com

Investor Relations: Kimberly Rogers, +1 385.831-7337, krogers@sequans.com

Condensed financial tables follow

Sequans reports first quarter 2021 financial results

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SEQUANS COMMUNICATIONS S.A.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	Three months ended
(in thousands of US, except share and per share amounts)	March 31, 2021	December 31, 2020	March 31, 2020
Revenue :
	3,773	3,727	3,271
Total revenue	12,321	15,791	8,772
Cost of revenue
	5,691	8,183	3,897
	452	494	373
Total cost of revenue	6,143	8,677	4,270
Gross profit	6,178	7,114	4,502
Operating expenses :
	7,254	7,938	7,421
	2,294	2,003	2,264
	2,460	2,606	2,605
Total operating expenses	12,008	12,547	12,290
Operating loss	(5,830)	(5,433)	(7,788)
Financial income (expense):
	(2,711)	(3,643)	(3,491)
	(4,090)	111	(5,621)
	1,358	(1,936)	675
Loss before income taxes	(11,273)	(10,901)	(14,826)
Income tax expense (benefit)	147	361	443
Loss
Attributable to :
	(11,420)	(11,262)	(15,269)
	—	—	—
Basic loss per ADS	(0.33)	(0.36)	(0.64)
Diluted loss per ADS	(0.33)	(0.36)	(0.64)
Weighted average number of ADS used for computing:
— Basic	34,664,779	31,044,769	23,904,935
— Diluted	34,664,779	31,044,769	23,904,935

All values are in US Dollars.

Sequans reports first quarter 2021 financial results

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SEQUANS COMMUNICATIONS S.A.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

	At March 31,		At Dec 31,
(in thousands of US)	2021		2020
ASSETS
	$	9,086	$	9,187
	27,771		25,312
	3,303		588
	369		386
	40,529		35,473
	4,621		6,225
	7,078		17,277
	496		371
	1,190		962
	7,728		3,264
	5,224		5,110
	—		10,900
	13,486		7,574
	39,823		51,683
Total assets	$	80,352	$	87,156
EQUITY AND LIABILITIES
	$	3,459	$	3,269
	288,714		276,560
	53,223		46,677
	(374,629)		(363,209)
	(466)		(423)
	(29,699)		(37,126)
	14,548		11,203
	638		2,172
	16,102		26,074
	9,951		12,395
	4,092		4,762
	646		851
	2,017		1,874
	20		19
	599		2,397
	48,613		61,747
	14,716		15,701
	11,026		14,228
	5,964		6,104
	1,202		1,014
	6,134		3,867
	12,894		13,145
	9,502		8,476
	61,438		62,535
Total equity and liabilities	$	80,352	$	87,156

All values are in US Dollars.

Sequans reports first quarter 2021 financial results

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SEQUANS COMMUNICATIONS S.A.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW

		Three months ended March 31,
(in thousands of US)		2021		2020
Operating activities
		$	(11,273)	$	(14,826)
	Depreciation and impairment of property, plant and equipment	875		1,015
	Amortization and impairment of intangible assets	1,895		1,180
	Share-based payment expense	1,160		667
	Increase in provisions	41		52
	Interest expense, net	2,734		3,491
	Change in the fair value of convertible debt embedded derivative	4,090		5,621
	Convertible debt amendment	—		(1,399)
	Foreign exchange loss (gain)	(1,115)		(545)
	Bad debt expense	—		18
	Decrease (Increase) in trade receivables and other receivables	10,141		(1,669)
	Decrease in inventories	1,604		518
	Decrease (Increase) in research tax credit receivable	380		(490)
	Increase in trade payables and other liabilities	208		1,402
	Decrease in contract liabilities	(2,812)		(2,574)
	Increase (Decrease) in government grant advances	1,390		(110)
		(120)		(76)
Net cash flow provided by (used in) operating activities		9,198		(7,725)
Investing activities
		(3,610)		(943)
		(2,279)		(1,431)
		(2,698)		(28)
		10,900		—
		23		19
Net cash flow used in investments activities		2,336		(2,383)
Financing activities
		87		27
		(2,976)		2,504
		—		405
		(448)		(439)
		(121)		—
		(1,460)		(811)
		(181)		—
		(533)		(537)
Net cash flows from financing activities		(5,632)		1,149
		5,902		(8,959)
		10		(2)
		7,574		14,098
Cash and cash equivalents at end of the period		13,486		5,137

All values are in US Dollars.

Sequans reports first quarter 2021 financial results

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SEQUANS COMMUNICATIONS S.A.

UNAUDITED RECONCILIATION OF NON-IFRS FINANCIAL RESULTS

(in thousands of US, except share and per share amounts)				Three months ended
			December 31, 2020		March 31, 2020
Net IFRS loss as reported
Add back
	Non-cash stock-based compensation expense according to IFRS 2 (1)			1,160		1,172	667
	Non-cash change in the fair value of convertible debt embedded derivative			4,090		(111)	5,621
	Non-cash interest on convertible debt and other financing (2)			1,085		1,663	1,294
	Non-cash impact of deferred tax income (loss)			—		—	398
	Non-cash impact of convertible debt amendment			—		—	(1,399)
IFRS basic loss per ADS as reported				(0.33)		(0.36)	(0.64)
Add back
	Non-cash stock-based compensation expense according to IFRS 2 (1)			0.03		0.04	0.03
	Non-cash change in the fair value of convertible debt embedded derivative			0.12		0.00	0.24
	Non-cash interest on convertible debt and other financing (2)			0.03		0.04	0.05
	Non-cash impact of deferred tax income (loss)			0.00		0.00	0.02
	Non-cash impact of convertible debt amendment			0.00		0.00	(0.06)
Non-IFRS basic loss per ADS				(0.15)		(0.28)	(0.36)
IFRS diluted loss per ADS				(0.33)		(0.36)	(0.64)
Add back
	Non-cash stock-based compensation expense according to IFRS 2 (1)			0.03		0.04	0.03
	Non-cash change in the fair value of convertible debt embedded derivative			0.12		0.00	0.24
	Non-cash interest on convertible debt and other financing (2)			0.03		0.04	0.05
	Non-cash impact of deferred tax income (loss)			0.00		0.00	0.02
	Non-cash impact of convertible debt amendment			0.00		0.00	(0.06)
Non-IFRS diluted loss per ADS				(0.15)		(0.28)	(0.36)
	(1) Included in the IFRS loss as follows:
		Cost of product revenue
		Research and development		554		647	272
		Sales and marketing		217		190	124
		General and administrative		374		307	266
	(2) Related to the difference between contractual and effective interest rates

All values are in US Dollars.