On August 7, 2024, Gogo Inc (GOGO, Financial) released its 8-K filing detailing its financial results for the second quarter ended June 30, 2024. Gogo Inc is a leading provider of broadband connectivity services for the business aviation market, offering a customizable suite of smart cabin systems for integrated connectivity, inflight entertainment, and voice solutions.
Q2 2024 Financial Highlights
Gogo Inc reported total revenue of $102.1 million for Q2 2024, slightly down by 1% year-over-year but surpassing the analyst estimate of $99.02 million. The company achieved record service revenue of $81.9 million, marking a 4% increase year-over-year. However, equipment revenue declined by 17% to $20.1 million compared to Q2 2023.
Net income for the quarter was $0.8 million, a significant drop from $89.8 million in Q2 2023. This decline was primarily due to an $11.0 million after-tax unrealized loss related to a fair market value adjustment to a convertible note investment. Diluted earnings per share (EPS) came in at $0.01, falling short of the analyst estimate of $0.07.
Operational Metrics and Challenges
Gogo Inc's total ATG aircraft online (AOL) reached 7,031, a slight decrease compared to Q2 2023. However, the number of AVANCE AOL grew to 4,215, a 17% increase year-over-year. The average monthly revenue per ATG aircraft online (ARPU) was a record $3,468, up 3% year-over-year.
Despite these positive metrics, the company faced challenges, including a 17% decrease in AVANCE equipment units shipped compared to Q2 2023. Additionally, the net income was adversely affected by the unrealized loss on the convertible note investment.
Financial Achievements and Industry Impact
Gogo Inc's record service revenue and strong free cash flow of nearly $25 million are significant achievements. These metrics are crucial for the company's long-term growth and stability, especially in the highly competitive telecommunication services industry.
“Channel excitement and momentum continues to build ahead of our expected launches of Gogo Galileo HDX in the fourth quarter of 2024, and Galileo FDX and Gogo 5G in 2025,” said Oakleigh Thorne, Chairman and CEO.
Income Statement Summary
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Total Revenue | $102.1 million | $103.2 million |
| Service Revenue | $81.9 million | $79.1 million |
| Equipment Revenue | $20.1 million | $24.2 million |
| Net Income | $0.8 million | $89.8 million |
| Diluted EPS | $0.01 | $0.67 |
Balance Sheet and Cash Flow Highlights
As of June 30, 2024, Gogo Inc reported cash and cash equivalents of $161.6 million, up from $152.8 million as of March 31, 2024. The company generated $24.9 million in cash from operating activities, an increase from $15.6 million in the prior year period.
Updated 2024 Guidance and Long-Term Targets
Gogo Inc updated its 2024 guidance, projecting total revenue in the range of $400 million to $410 million, down from the prior guidance of $410 million to $425 million. The company expects Adjusted EBITDA at the high end of the range of $110 million to $125 million and Free Cash Flow in the range of $35 million to $55 million.
“Our second quarter results highlighted record service revenue and strong Free Cash Flow of nearly $25 million,“ said Jessi Betjemann, Executive Vice President and CFO.
For more detailed financial information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Gogo Inc for further details.
