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Jun 30, 2020
Globalstar Q2 2020 Earnings Report
Globalstar's profitability improved despite COVID-19 and the oil and gas industry downturn, with new product launches and progress in global gateway performance.
Key Takeaways
Globalstar reported a 3% decrease in total revenue due to lower subscriber equipment sales, offset by an increase in service revenue. The company launched new products, including the ST100 and the SPOT Gen4™, and expanded its global gateway coverage. Adjusted EBITDA increased to $9.8 million.
Total revenue decreased by 3% compared to the second quarter of 2019, mainly due to a decline in subscriber equipment sales.
Service revenue increased due to engineering service revenue, offsetting declines in SPOT and Duplex service revenue.
Operating loss decreased from $16.7 million to $15.4 million due to lower operating expenses.
Adjusted EBITDA increased to $9.8 million driven by decreased operating expenses.
Globalstar
Globalstar
Globalstar Revenue by Segment
Revenue by Segment
Commercial IoT Revenue
CapyFin.comSPOT Revenue
CapyFin.comDuplex Revenue
CapyFin.com Forward Guidance
Globalstar is focused on pursuing revenue opportunities, launching new products and geographies, and monetizing its spectrum assets. A commercial deal with Nokia for Band 53 in a private LTE network is expected to drive further momentum in the development of the Band 53/n53 ecosystem.
Positive Outlook
- New products and geographies are expected to drive revenue growth.
- Monetization of spectrum assets will create new revenue streams.
- The deal with Nokia for Band 53 is expected to lead to more commercial deals.
- Increased automation and remote control of processes are expected to increase the need for wireless connectivity.
- Reliable wireless connections for dispersed collaboration will drive demand for spectrum.
Challenges Ahead
- The full extent of the pandemic’s impact on the telecommunications industry will play out over the coming quarters.
- Travel restrictions have slowed progress on the international regulatory agenda.
- Subscriber-driven revenue streams declined by $1.6 million
- Decline in SPOT service revenue in the second quarter of 2020 was due to lower ARPU and fewer subscribers.
- Subscriber equipment sales revenue decreased $1.2 million in the second quarter of 2020 compared to the second quarter of 2019.
Revenue & Expenses
Visualization of income flow from segment revenue to net income