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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.
Revenue by Segment
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
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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