Iridium(IRDM) - 2024 Q3 - Quarterly Report

Subscriber Growth - As of September 30, 2024, the company had approximately 2,482,000 billable subscribers, an increase of 246,000, or 11%, from 2,236,000 billable subscribers as of September 30, 2023[71]. Revenue Performance - Total revenue for the three months ended September 30, 2024, was $212.8 million, an increase of$15.2 million, or 8%, compared to $197.6 million for the same period in 2023[75]. - Total revenue for the nine months ended September 30, 2024, was$617.7 million, an increase of $21.7 million, or 4$24.5 million, or 7%, for the nine months ended September 30, 2024, primarily driven by increases in IoT and voice and data service revenue[96]. - Commercial IoT revenue increased by $19.8 million, or 19$54.9 million, a significant increase of $26.7 million, or 95$28.2 million in the prior year[75]. - Total operating expenses decreased by $11.5 million, or 7$157.9 million for the three months ended September 30, 2024, from $169.4 million in the prior year[75]. - Selling, general and administrative expenses increased by$10.6 million, or 32%, for the three months ended September 30, 2024, primarily due to costs related to the acquisition of Satelles and higher headcount costs[85]. - Research and development expenses increased by $1.2 million, or 23$6.2 million for the three months ended September 30, 2024[75]. - Research and development expenses increased by $5.4 million, or 37$24.4 million for the three months ended September 30, 2024, compared to a net loss of $1.6 million in the same period of the prior year[75]. - Net income improved to$76.4 million for the nine months ended September 30, 2024, compared to a net loss of $22.6 million for the prior year period[109]. - Net income was$24.4 million for the three months ended September 30, 2024, compared to a net loss of $1.6 million for the prior year period, reflecting a$26.1 million increase in net income[91]. Cash Flow and Financial Position - Total cash and cash equivalents increased to $159.6 million as of September 30, 2024, up from$71.9 million as of December 31, 2023[110]. - Cash provided by operating activities was $271.2 million for the nine months ended September 30, 2024, an increase of$44.1 million compared to the prior year[115]. - Net cash provided by operating activities increased by $44.1 million for the nine months ended September 30, 2024, primarily due to a$40.6 million increase in working capital[116]. - Net cash used in investing activities increased by $89.1 million, mainly due to the acquisition of Satelles on April 1, 2024, with capital expenditures expected to average approximately$60.0 million per year through 2030[117]. - Net cash used in financing activities decreased by $232.2 million, primarily due to an additional$325.0 million in borrowings under the Term Loan[118]. Acquisitions and Investments - The company acquired Satelles, Inc. on April 1, 2024, to enhance its satellite-based time and location services[71]. Debt and Interest Expense - The outstanding aggregate balance under the Term Loan was $1,812.3 million as of September 30, 2024, with interest rates tied to SOFR plus 2.25$10.4 million, or 30%, for the three months ended September 30, 2024, primarily due to lower fees associated with term loan refinancing[88]. - For every 25 basis points increase in SOFR above the Cap, the company expects an additional $2.0 million in annual interest expense related to the unhedged portion of the Term Loan[121]. Seasonal Trends - The company expects seasonal usage changes to affect results, with March through October being peak months for commercial voice services revenue[119]. Accounting Policies - There have been no changes to critical accounting policies and estimates from those described in the Annual Report for the year ended December 31, 2023[120]. - The company performs credit evaluations of customers and records reserves for estimated credit losses on accounts receivable[121]. - The company has experienced no significant changes in its financial condition or results of operations that would affect its accounting estimates[120].