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Jun 30, 2023
Gogo Q2 2023 Earnings Report
Announced second quarter results and updated 2023 financial guidance and long-term targets.
Key Takeaways
Gogo Inc. reported a 6% year-over-year increase in total revenue, reaching $103.2 million, and a net income of $89.8 million. Adjusted EBITDA increased by 7% year-over-year to $44.1 million.
Total revenue increased 6% compared to Q2 2022, reaching $103.2 million.
Record service revenue increased 8% compared to Q2 2022, totaling $79.1 million.
Total ATG aircraft online reached 7,064, an increase of 6% compared to Q2 2022.
Net income increased from $22.0 million in Q2 2022 to $89.8 million, including an income tax benefit of $63.8 million.
Forward Guidance
The Company provides the following guidance for 2023, which now include the impact of the Federal Communications Commission's Secure and Trusted Communications Networks Reimbursement Program
Positive Outlook
- Adjusted EBITDA of $150 million to $160 million (no change from prior guidance) reflecting operating expenses of approximately $20 million for strategic and operational initiatives including Gogo 5G and Gogo Galileo and $10 million for costs incurred offset by an expected benefit for the same value of reimbursement accrual related to the FCC Program.
- Revenue growth at a compound annual growth rate of approximately 15%-17% from 2022 through 2027 versus the prior target of approximately 17%.
- Annual Adjusted EBITDA Margin in the mid-40% range by 2027 (no change from prior long-term target).
- Free Cash Flow in the range of $150 million to $200 million in 2025, without the effect of the FCC program, and growing thereafter.
- The FCC Program is expected to positively impact Free Cash Flow in 2025.
Challenges Ahead
- Total revenue in the range of $410 million to $420 million versus prior guidance in the range of $440 million to $455 million.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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