Q1 2024 Gogo Inc Earnings Call Transcript
Key Points
- Gogo Inc (GOGO) achieved strong results in Q1 2024, setting a record for free cash flow and open market share repurchases.
- The company experienced a rebound in advanced equipment revenue and a record in service revenue, driven by a modest price increase and record advanced upgrades.
- Gogo Inc (GOGO) is investing in next-generation products, Gogo Galileo and Gogo 5G, which are expected to accelerate revenue growth starting next year.
- The company reported a 6% year-over-year increase in current revenue, with service revenue up 4% and equipment revenue up 13% quarter over quarter.
- Gogo Inc (GOGO) achieved its highest Q1 EBITDA ever, driven by strong equipment sales, permanent OpEx savings, and changes in the timing of project-related OpEx.
- There was a slight decline in overall units online for the quarter due to an inflation-driven 4% price increase, which led to some customers dropping their service.
- The company experienced declines in Gogo classic service revenue as customers migrate to LTE.
- Gogo Inc (GOGO) is still waiting for the 5G chip, which has failed bring-up twice and has undergone a minor hardware redesign, leading to a delay in the launch of Gogo 5G.
- The FCC's Secure and Trusted Network program funding was cut back to 39% of the original award, impacting the financial support for Gogo's rip and replace program.
- There are ongoing legal expenses related to the Smart Sky patent litigation, which are expected to continue in the coming quarters.
Thank you for standing by, and welcome to Gogo Inc's first quarter 2024 earnings conference call. (Operator Instructions) I would now like to hand the call over to William Davis, Vice President, Investor Relations. Please go ahead.
Thank you, Atif, and good morning, everyone. Welcome to Gogo's first quarter of 2024 earnings conference call. Joining me today to talk about our results are Oakleigh Thorne, Chairman and CEO, Jessi Betjemann, Executive Vice President and CFO.
Before we get started, I would like to take this opportunity to remind you that during the course of this call, we may make forward-looking statements regarding future events and the future performance of the Company. We caution you to consider the risk factors that could cause actual results to differ materially from those in the forward-looking statements on this conference call. Those risk factors are described in our earnings release filed this morning and are more fully detailed under Risk Factors in our annual report
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