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Sep 30, 2022
Gogo Q3 2022 Earnings Report
Gogo's revenue increased driven by growth in service and equipment revenue, with net income rising slightly and adjusted EBITDA showing a moderate increase.
Key Takeaways
Gogo Inc. reported record third-quarter revenue of $105.3 million, a 21% increase year-over-year, driven by strong growth in both service and equipment revenue. Net income from continuing operations increased to $20.2 million, and adjusted EBITDA rose by 7% to $43.7 million.
Record total revenue reached $105.3 million, up 21% year-over-year.
Service revenue hit a record of $75.3 million, a 14% increase year-over-year.
Equipment revenue also reached a record of $30.1 million, a 43% increase year-over-year.
Adjusted EBITDA reached a record of $43.7 million, up 7% year-over-year.
Gogo
Gogo
Forward Guidance
Gogo updated its 2022 financial guidance with increased expectations for total revenue, adjusted EBITDA, and free cash flow.
Positive Outlook
- Total revenue is projected to be between $395 million and $405 million.
- Adjusted EBITDA is expected to range from $165 million to $170 million.
- Free cash flow is anticipated to be between $50 million and $60 million.
- Aggregate Free Cash Flow for 2022 and 2023 will be roughly equivalent to the range of $145 million to $155 million.
- Revenue growth at a compound annual growth rate of approximately 17% from 2021 through 2026
Challenges Ahead
- Adjusted EBITDA includes $6 million of estimated litigation expenses and estimated operating expenses for Global Broadband.
- Free Cash Flow guidance now includes capital expenditures of approximately $55 million, of which $40 million is tied to Gogo 5G.
- Free Cash Flow for 2023 will be impacted by the Gogo 5G delay and potentially by the Federal Communications Commission’s Secure and Trusted Communications Networks Reimbursement Program
- Annual Adjusted EBITDA Margin approaching 50% in 2026, up from the low 40%'s in 2022 and 2023.
- The Company’s 2022 financial guidance and long-term targets include Global Broadband but do not reflect the impact of other new strategic investments or the FCC Program