Expanded Platform Accelerates Gogo's LEO Strategy; Achieves $18m Run-rate Savings on Day 1Chris Moore Appointed Chief Executive Officer, Succeeding Oakleigh Thorne who Transitions to Executive ChairBROOMFIELD, Colo., Dec. 4, 2024 /PRNewswire/ -- Gogo Inc. (NASDAQ: GOGO) ("Gogo" or the "Company") today announced the completion of its acquisition of Satcom Direct ("SD"), creating the only multi-orbit, multi-band, in-flight connectivity provider serving the needs of every segment of the global business aviatio ...

Group 1 - Gogo Inc. is launching new products including Gogo 5G and has recently acquired several businesses, which may enhance EPS growth by 2025 [1] - The company has experienced a decline in debt levels, suggesting potential for new inorganic growth opportunities [1] Group 2 - The analyst has a beneficial long position in Gogo shares through stock ownership, options, or other derivatives [2] - The article reflects the analyst's personal opinions and is not compensated beyond Seeking Alpha [2]

Financial Performance - Total revenue increased to $100.5 million for the three-month period ended September 30, 2024, representing a 2.6% increase from $97.9 million in the prior-year period[83]. - Service revenue rose to $81.9 million for the three-month period ended September 30, 2024, a 2.9% increase from $79.5 million in the prior-year period, driven by increases in ARPU[83]. - Equipment revenue for the three-month period ended September 30, 2024, was $18.7 million, a 1.5% increase from $18.4 million in the prior-year period, attributed to an increase in ATG units sold[83]. - Net income for the three-month period ended September 30, 2024, was $10.6 million, down from $20.9 million in the prior-year period[83]. - The company reported a net income attributable to common stock of $10.6 million for the three months ended September 30, 2024, compared to $20.9 million for the same period in 2023, a decrease of 49.3%[90]. - Adjusted EBITDA for the three months ended September 30, 2024, was $34.8 million, compared to $43.2 million for the same period in 2023, reflecting a decrease of 19.3%[90]. Revenue Growth and Service Metrics - Gogo's ATG aircraft online increased to 4,379 in Q3 2024, up from 3,784 in Q3 2023, representing a growth of approximately 15.7%[77]. - Average monthly connectivity service revenue per ATG aircraft online rose to $3,497 in Q3 2024, compared to $3,373 in Q3 2023, reflecting an increase of about 3.7%[77]. - Narrowband satellite aircraft online decreased to 4,180 in Q3 2024 from 4,395 in Q3 2023, indicating a decline of approximately 4.9%[77]. - Average monthly connectivity service revenue per narrowband satellite aircraft online increased to $332 in Q3 2024, up from $294 in Q3 2023, marking a growth of about 12.9%[77]. - Gogo sold 214 ATG units in Q3 2024, compared to 192 units in Q3 2023, representing an increase of approximately 11.5%[77]. - The average equipment revenue per ATG unit sold was $75, consistent with the previous year, while narrowband satellite units sold generated an average revenue of $46, up from $39[77]. Operating Expenses and Challenges - Total operating expenses increased to $81.5 million for the three-month period ended September 30, 2024, compared to $64.6 million in the prior-year period, reflecting a 26% increase[83]. - General and administrative expenses surged 87% to $24.9 million for the three-month period ended September 30, 2024, compared to $13.3 million in the prior-year period, due to increased legal and acquisition-related expenses[85]. - The company continues to face challenges related to supply chain disruptions and labor shortages impacting equipment installations[75]. Cash Flow and Liquidity - Free Cash Flow for the nine months ended September 30, 2024, was $81.5 million, up from $54.3 million in the same period of 2023, representing an increase of 50.2%[91]. - Net cash provided by operating activities for the nine months ended September 30, 2024, was $79.7 million, compared to $52.8 million for the same period in 2023, indicating a growth of 50.9%[93]. - Cash, cash equivalents, and restricted cash at the end of the period on September 30, 2024, totaled $177.0 million, compared to $86.5 million at the end of the same period in 2023, showing a significant increase of 104.5%[93]. - The company expects its cash and cash equivalents, along with cash flows from operating activities, to be sufficient for its business needs for at least the next twelve months[94]. - The company’s liquidity strategy includes evaluating opportunities to raise additional capital in public and private markets to support growth and cash needs[93]. Debt and Financing - The Term Loan Facility has an aggregate principal amount of $725.0 million, with a maturity date of April 30, 2028[94]. - The company prepaid $100 million of the outstanding principal amount of the Term Loan Facility on May 3, 2023[95]. - The Revolving Facility was undrawn as of September 30, 2024, indicating no immediate reliance on this credit line[95]. - The financial covenant for the Revolving Facility is set at a maximum senior secured first lien net leverage ratio of 7.50:1.00[95]. - As of September 30, 2024, the notional amount of outstanding debt associated with interest rate cap agreements was $350.0 million, with a hypothetical one percentage point change in interest rates impacting annual interest expense by approximately $2.7 million[102]. - Interest expense increased by 20.5% to $9.7 million for the three-month period ended September 30, 2024, compared to $8.0 million in the prior-year period[86]. Future Outlook and Strategic Initiatives - Gogo plans to commercially launch its Gogo 5G network in late Q2 2025, enhancing its service offerings in the business aviation market[73]. - The Gogo Galileo service, targeting a commercial launch in Q4 2024, aims to expand broadband offerings beyond ATG and penetrate international markets[73]. - Gogo anticipates improved performance for a subset of customers transitioning to the new LTE network in early 2026, supported by FCC reimbursement[73]. - The company expects capital expenditures to increase in the near term due to Gogo 5G and the build-out of the LTE network related to the FCC Reimbursement Program[100].

Financial Performance - Total revenue for Q3 2024 was $100.5 million, a 3% increase year-over-year, but a 1% decrease compared to Q2 2024[2] - Service revenue reached $81.9 million, up 3% year-over-year, with a slight decrease from Q2 2024[2] - Net income for Q3 2024 was $10.6 million, a 49% decrease from $20.9 million in Q3 2023, but an increase from $0.8 million in Q2 2024[3] - Adjusted EBITDA was $34.8 million, a 19% decrease compared to Q3 2023, but a 14% increase from Q2 2024[3] - Total revenue for the three months ended September 30, 2024, was $100,529,000, an increase of 2% from $97,949,000 for the same period in 2023[16] - Operating income for the three months ended September 30, 2024, was $19,071,000, a decrease of 43% from $33,316,000 in the prior year[16] - Net income for the three months ended September 30, 2024, was $10,630,000, down 49% from $20,913,000 in the same quarter of 2023[16] - Adjusted EBITDA for Q3 2024 was $34.779 million, down from $43.198 million in Q3 2023, reflecting a decrease of 19.4%[20] - Free cash flow for Q3 2024 was $24.594 million, compared to $21.001 million in Q3 2023, representing an increase of 12.3%[20] Revenue and Growth Metrics - Average Monthly Revenue per ATG aircraft online (ARPU) was a record $3,497, a 4% increase year-over-year[2] - Total AVANCE aircraft online grew to 4,379, a 16% increase compared to Q3 2023[2] - Service revenue for the nine months ended September 30, 2024, reached $245,459,000, compared to $237,107,000 in 2023, reflecting a growth of 3%[16] - Average monthly connectivity service revenue per ATG aircraft online increased from $3,378 in September 2023 to $3,474 in September 2024, representing a growth of 2.8%[19] - Units sold for ATG systems increased from 192 in September 2023 to 214 in September 2024, showing an increase of 11.5%[19] Cash Flow and Liquidity - Free Cash Flow for Q3 2024 was $24.6 million, an increase from $21.0 million in the prior year period[3] - Cash and cash equivalents increased to $176,678,000 as of September 30, 2024, up from $139,036,000 at the end of 2023[17] - Net cash provided by operating activities for the nine months ended September 30, 2023, was $52,818,000, while it increased to $79,740,000 in 2024, reflecting a growth of approximately 50.9%[18] - Cash and cash equivalents at the end of the period increased to $176,678,000 from $86,157,000, marking a substantial rise of 105.5%[18] - Cash paid for interest decreased from $53,911,000 in the previous period to $42,893,000, indicating a reduction of approximately 20.5%[18] Assets and Liabilities - Total assets as of September 30, 2024, were $810,737,000, compared to $781,539,000 at the end of 2023, indicating a growth of 4%[17] - Total liabilities increased to $758,013,000 as of September 30, 2024, from $740,814,000 at the end of 2023[17] - The company’s accumulated deficit decreased to $(1,171,932,000) as of September 30, 2024, from $(1,213,891,000) at the end of 2023[17] Expenses - General and administrative expenses for the three months ended September 30, 2024, were $24,917,000, significantly higher than $13,336,000 in the same period last year[16] - Cost of service revenue increased by 5.2% to $19.051 million in Q3 2024 from $18.116 million in Q3 2023[20] - Cost of equipment revenue rose by 23.1% to $15.165 million in Q3 2024, compared to $12.320 million in Q3 2023[20] Future Outlook - Revised 2024 guidance includes total revenue expected in the range of $400 million to $410 million[7] - Net cash provided by operating activities for FY 2024 is estimated to be between $59 million and $67 million[21] - Consolidated capital expenditures for FY 2024 are projected at $(30) million[21] - The company expects free cash flow for FY 2024 to be between $55 million and $65 million[21] Acquisitions and Partnerships - The company announced a definitive agreement to acquire Satcom Direct, enhancing its in-flight connectivity capabilities[4] - Gogo's Galileo HDX solution will be installed as a factory option by Textron Aviation for several jet models[4] Other Financial Metrics - Total ATG aircraft online at the end of September 2024 was 7,016, a slight decrease from 7,150 in September 2023[19] - Average equipment revenue per ATG unit sold remained stable at $75, consistent with the previous year[19] - The company reported a loss on extinguishment of debt of $2,224,000 in the previous period, which was not present in the current reporting period[18] - The company acquired intangible assets, specifically capitalized software, totaling $9,640,000 in the current period, compared to $4,711,000 in the previous period[18]

Financial Data and Key Metrics Changes - Gogo's total revenue for Q3 2024 was $100.5 million, reflecting a 3% year-over-year increase and a slight sequential decrease [46] - Service revenue reached $81.9 million, also up 3% year-over-year but slightly down from the previous quarter [46] - Adjusted EBITDA for Q3 was $34.8 million, a 19% decrease year-over-year but a 14% increase sequentially [58] - Free cash flow generated in Q3 was $24.6 million, up $3.6 million from the prior year [65] Business Line Data and Key Metrics Changes - Total AVANCE units online grew to 4,379, a 16% increase year-over-year, representing 62% of the ATG installed base [47][16] - Equipment revenue for Q3 was $18.7 million, with 214 AVANCE shipments, an 11% year-over-year increase but down 7% sequentially [51] - ATG ARPU reached a record $3,497, reflecting a 4% year-over-year increase [50] Market Data and Key Metrics Changes - Demand for business aviation flights increased by 2% year-over-year and 30% compared to pre-COVID Q3 2019 [11] - Data usage per hour on flights rose by 17% year-over-year and 106% from pre-COVID Q3 2019 [11] - According to Honeywell, aircraft owners are expected to invest $280 billion in approximately 8,500 new business jets by 2033, with the fastest growth in heavy jets [13] Company Strategy and Development Direction - Gogo is focusing on expanding its addressable market globally, particularly outside the U.S., and driving AVANCE penetration [18] - The planned acquisition of Satcom Direct is expected to enhance Gogo's capabilities in the MilGov market and expand its product offerings [23][25] - Gogo aims to launch Gogo Galileo and Gogo 5G products to meet increasing demand for high-bandwidth connectivity [36][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about reaccelerating growth due to new product launches and the acquisition of Satcom Direct [6][7] - The company anticipates that the acquisition will be accretive to earnings and will significantly enhance its market position [25][79] - Management acknowledged the competitive landscape but emphasized the strategic advantages of their product offerings [88] Other Important Information - Gogo's cash and short-term investments totaled $176.7 million, with a net leverage ratio of 3.0x [67] - The company expects to close the Satcom Direct acquisition by early December 2024 [92] - Gogo has withdrawn its long-term financial targets due to the pending acquisition [46][76] Q&A Session Summary Question: Is there any reason to think that the pro forma free cash flow number might shift? - Management indicated that increased debt from the acquisition will raise interest expenses, impacting free cash flow [84] Question: What is the rationale behind the Satcom Direct acquisition? - Management emphasized that the acquisition is primarily about enhancing LEO connectivity and expanding into new market segments [86] Question: What is the expected timeline for closing the Satcom Direct deal? - Management hopes to close the deal by early December, pending regulatory approvals [92] Question: How should investors think about the change in revenue growth guidance? - Management clarified that standalone Gogo's growth remains at 15% to 17%, but the combined company's guidance is more cautious due to market conditions [94]

For the quarter ended September 2024, Gogo (GOGO) reported revenue of $100.53 million, up 2.6% over the same period last year. EPS came in at $0.12, compared to $0.16 in the year-ago quarter.The reported revenue represents a surprise of +3.69% over the Zacks Consensus Estimate of $96.95 million. With the consensus EPS estimate being $0.05, the EPS surprise was +140.00%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expe ...

Gogo (GOGO) came out with quarterly earnings of $0.12 per share, beating the Zacks Consensus Estimate of $0.05 per share. This compares to earnings of $0.16 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 140%. A quarter ago, it was expected that this in-flight internet provider would post earnings of $0.07 per share when it actually produced earnings of $0.10, delivering a surprise of 42.86%.Over the last four quarters, the c ...

Total Revenue of $100.5 million, up 3% Year-over-Year; Third Quarter Service Revenue of $81.9 million, up 3% Year-over-YearQ3 Net Income of $10.6 million; Adjusted EBITDA(1) of $34.8 millionUpdates 2024 GuidanceRecent Strategic Galileo HDX wins with Textron Aviation and Wheels Up BROOMFIELD, Colo., Nov. 5, 2024 /PRNewswire/ -- Gogo Inc. (NASDAQ: GOGO) ("Gogo" or the "Company"), a leading global provider of broadband connectivity services for the business aviation market, today announced its financial result ...

BROOMFIELD, Colo., Nov. 4, 2024 /PRNewswire/ -- Gogo Business Aviation (NASDAQ: GOGO) announced today that its Gogo Galileo HDX electronically steerable antenna (ESA), designed to provide access to Low Earth Orbit (LEO) satellite networks for all sizes of business aircraft, has passed FAA-mandated DO-160 qualification testing."Passing DO-160 keeps us on track to receive the first-article Supplemental Type Certificate (STC) and commercially launch Gogo Galileo later this year," said Jeremy Tyler, vice presid ...

LAS VEGAS, Oct. 22, 2024 /PRNewswire/ -- (NBAA-BACE, booth 1601) – Wheels Up has reached an agreement with Gogo Business Aviation (NASDAQ: GOGO) to add Gogo Galileo HDX, the company's Low Earth Orbit (LEO) global broadband satellite solution, fleetwide."Exceptional onboard Wi-Fi is a central in-flight experience feature our members and customers value when selecting an aircraft," said George Mattson, CEO for Wheels Up. "Gogo is a long-term proven partner of ours, and their next generation Galileo HDX system ...