On the asset tracking side, our asset trackers are deployed across transportation, supply chain and other specialized applications. Asset trackers bring a recurring revenue opportunity as well with multiple subscription based components, such as our NimbeLink cloud based device enablement platform and our trucking information dashboards. Our 5G connectivity products include our Lantern FWA, built to improve connectivity at the home or in the office. Our Lighthouse Smart Repeater, designed to expand high quality coverage for mobile network operators and our recently announced next generation AC Fleet 5G Vehicle Gateway created to offer wide area cellular and local area Wi-Fi connectivity across public safety, transportation and public and private vehicle fleets.
We have received significant interest for each of these solutions. For Lighthouse, we are making steady progress on the international strategic partnership that we mentioned last quarter, including a live network trial. Altogether, we currently have two active customer trials with four more planned for the second half of the year. Also, for AC Fleet, we have over 20 customer trials across our domestic and international customers scheduled for second quarter. Again, these three product lines represent over $700 million of potential projected serviceable addressable market in 2024 and $1.7 billion of potential additional SAM in 2025, effectively doubling our foundational SAM of $1.8 billion for our existing product lines. Our connectivity products are the combination of several years of investments in shifting Airgain from exclusively components to full systems, and we believe that we have significant upside in these areas.
Lastly, in February during Mobile World Congress, we announced our Smart FWA technology, which is designed to transform the 5G customer experience by optimizing connectivity and reducing the number of truckloads and customer returns the operators currently experience. Especially as we work to ship Lantern FWA, we believe that this is a strong market entry point to establish our demand base for the eventual delivery of Smart FWA in 2025 and beyond. With that, I will turn the call over to Michael to discuss our first quarter 2024 financial results and second quarter 2024 outlook in greater detail. Michael?
Michael Elbaz: Thank you, Jacob. Before diving into the numbers, please note that my review of our financial results and guidance refers to non-GAAP figures. Information about the non-GAAP financial measures, including GAAP to non-GAAP reconciliations can be found in our earnings release. Now, let’s turn to our first quarter results. As Jacob mentioned, Q1 sales were $14.2 million, above the $14 million midpoint of our guidance range. While our first quarter sales increased by 41% sequentially, they were still lower by 13.5% on a year-over-year basis, primarily because of continued headwinds in our consumer and automotive markets. Enterprise sales were $8.9 million, reflecting a sequential increase of $4.3 million or 92%, driven by growth in our custom products, embedded modems and IoT antennas product lines.
In our custom products, we completed our large project along with shipments of production units for a strategic customer. In addition, our embedded modem sales increased to pre-2023 level as distributors continue to recover from excess channel inventory. On a year-over-year basis, enterprise sales increased by over 5%. Consumer sales were $3.5 million, reflecting a sequential increase of $0.3 million driven primarily by shipments of a Tier 1 MNO antenna design win we announced last November. Automotive sales were $1.8 million, reflecting a sequential decrease of $0.4 million due to ongoing excess inventory correction. Q1 gross margin was 40.2%, 990 basis points higher sequentially due to a large inventory charge we recorded in the fourth quarter of 2023.
On a year-over-year basis, Q1 gross margin was 120 basis points higher, primarily because of a higher automotive margin. Q1 operating expenses totaled $6.6 million relatively flat sequentially. Q1 2024 operating expenses decreased by $0.7 million from Q1 2023. On a year-over-year basis, engineering expenses increased by over 20% to support new product initiatives. This expense increase was more than offset by our focus on efficiencies, which resulted in a reduction of our G&A and marketing communication expenses of over 25% on a year-over-year basis. As a result, our Q1 adjusted EBITDA was negative $0.7 million and non-GAAP EPS was negative $0.08. Our cash balance as of March 31, 2024 was $7.2 million, $0.7 million lower sequentially, resulting from negative cash flow from operations of $1.3 million, partially offset by net proceeds from the ATM offering we launched two months ago.
Our accounts receivable balance was $9.6 million, $2.3 million higher sequentially, primarily due to higher sales. Net inventory was $2.6 million, $0.2 million higher sequentially. Now moving to our outlook for the second quarter ending June 30, 2024. As a reminder, we provide quarterly guidance for sales, non-GAAP gross margin and expenses, non-GAAP EPS and adjusted EBITDA as we believe these metrics to be key indicators for the overall performance of our business. We project sales for the 2024 second quarter to be in the range of $14.25 million to $15.75 million or $15 million at the midpoint of the range. We expect a sequential growth of approximately 5% at the midpoint of our guidance, driven by growth in our consumer markets from both our MNO and MSO customers.
We expect our enterprise sales to be relatively flat sequentially with an anticipated decline in our custom products due to the large project shipments in Q1, offset by growth in our asset trackers, embedded modems and IoT antennas, as well as first shipments of our FWA solution. We expect non-GAAP gross margin for the second quarter to be in the range of 39.5% to 42.5% or 41% at the midpoint of the guidance. We anticipate the sequential increase in gross margin to be driven by higher enterprise margin due to differentiated new products and applications. We expect our operating expenses to be approximately $6.8 million. We continue to invest in our engineering and sales teams as we focus on our strategic initiatives in fixed wireless access, vehicle networking and Smart C-Band repeaters markets.
Non-GAAP EPS is expected to be negative $0.06 at the midpoint of our guidance. Adjusted EBITDA is expected to be negative $0.5 million at the midpoint of our guidance. Now, I would like to turn the call back over to Jacob for his closing thoughts. Jacob?
Jacob Suen: Thanks, Michael. A few closing thoughts before we head to Q&A. First, I am proud of our team’s effort and dedication to our strategic roadmap initiatives. We have several highly innovative products that are on tight timelines. And as of today I can confidently say that, we are executing on what we have promised and are still on schedule. This is only possible with our team’s strong commitment in a highly effective and experienced management team. Second, we remain optimistic about our market potential and industry recovery. Even as we continue to face significant headwinds, we have made real progress along many aspects of our business, including new products, new partners and new geographies. We continue to invest in our growth as well, including the expansions of our sales force as a part of a more aggressive growth strategy in response to progress across several of our product initiatives in improving market demand.
