On August 8, 2024, Globalstar Inc (GSAT, Financial) released its 8-K filing for the second quarter ended June 30, 2024. Globalstar Inc is a telecommunications company that derives revenue from the provision of mobile satellite services, primarily within the United States. The company offers two-way voice and data transmission services, as well as one-way data transmission using mobile or fixed devices, and owns significant satellite assets.
Performance Overview
Globalstar Inc (GSAT, Financial) reported a total revenue of $60.4 million for Q2 2024, a 10% increase from $55.1 million in Q2 2023. This growth was primarily driven by an 18% increase in service revenue, which totaled $57.6 million, up from $48.6 million in the same period last year. However, the company faced a decline in revenue from subscriber equipment sales, which fell to $2.8 million from $6.4 million in Q2 2023.
Key Financial Metrics
Despite the revenue growth, Globalstar Inc (GSAT, Financial) reported a net loss of $9.7 million for Q2 2024, compared to a net income of less than $0.1 million in Q2 2023. The loss from operations was $1.4 million, a significant decline from an income of $2.6 million in the prior year's quarter. This was primarily due to higher operating expenses, including increased network operating costs and stock-based compensation.
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Total Revenue | $60.4 million | $55.1 million |
| Service Revenue | $57.6 million | $48.6 million |
| Subscriber Equipment Sales | $2.8 million | $6.4 million |
| Net Loss | ($9.7 million) | ($0.1 million) |
| Adjusted EBITDA | $32.6 million | $27.0 million |
Financial Achievements and Challenges
Globalstar Inc (GSAT, Financial) achieved a 20% increase in Adjusted EBITDA, reaching $32.6 million in Q2 2024, up from $27.0 million in Q2 2023. This improvement was driven by the high-margin nature of the increased service revenue. The company also reported an increase in cash on hand to $64 million as of June 30, 2024.
"Globalstar reported record revenue during the second quarter, driven primarily by growth in wholesale capacity services and other recent business initiatives. The high-margin nature of this revenue contributed to a 20% increase in Adjusted EBITDA and an increase in cash on hand to $64 million as of June 30, 2024," commented Rebecca Clary, Chief Financial Officer.
Income Statement Highlights
Service revenue saw a notable increase, particularly in the Commercial IoT segment, which reached a record high of $6.7 million, a 25% increase from the prior year's quarter. However, revenue from subscriber equipment sales declined due to the timing of Commercial IoT and SPOT device sales.
Balance Sheet and Cash Flow
As of June 30, 2024, Globalstar Inc (GSAT, Financial) held cash and cash equivalents of $64.3 million, compared to $56.7 million as of December 31, 2023. The company generated $66.5 million in net cash flows from operations during the first half of 2024, which were used to fund capital expenditures of $74.5 million.
Financial Outlook
Based on the continued momentum, Globalstar Inc (GSAT, Financial) has raised the low end of its revenue guidance for the full year 2024 to $235 million from $225 million and projected an Adjusted EBITDA margin of 53%, up from 50%.
"Based on the continued momentum across our key growth categories, we are raising the low end of our revenue guidance to $235 million from $225 million and projected Adjusted EBITDA margin to 53% from 50%," stated Rebecca Clary, Chief Financial Officer.
For more detailed financial information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Globalstar Inc for further details.
