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Gogo Inc. (NASDAQ: GOGO) is the world's largest provider of broadband connectivity services for the business aviation market. Headquartered in Broomfield, Colorado, Gogo offers a robust suite of smart cabin systems that integrate connectivity, in-flight entertainment, and voice solutions. These services are installed on thousands of business aircraft, ranging from turboprops to the largest global jets.
Gogo's business model primarily operates through two revenue streams: service revenue and equipment revenue. Service revenue comprises monthly subscription and usage fees paid by aircraft owners and operators for telecommunication, data, and in-flight entertainment services. On the other hand, equipment revenue stems from the sale of Air-to-Ground (ATG) and narrowband satellite connectivity equipment, recognized when control of the equipment is transferred to Original Equipment Manufacturers (OEMs) and dealers.
Gogo has recently made significant strides in its 5G program. The AVANCE LX5 has received Supplemental Type Certification (STC) and Parts Manufacturer Approval (PMA) from the Federal Aviation Administration (FAA). This approval paves the way for customer installations of the LX5, which is expected to deliver approximately 25 Mbps on average, with peak speeds reaching 75-80 Mbps. Moreover, Gogo's collaboration with NetJets will enable the upgrade of their U.S. and European fleets to Gogo's AVANCE L5, Gogo 5G, and Galileo, the company's Low Earth Orbit (LEO) broadband satellite service.
In the legal domain, Gogo recently secured a favorable ruling from the United States Court of Appeals for the Federal Circuit, which upheld a previous judgment denying SmartSky Networks' motion for a preliminary injunction against Gogo's 5G product. This enables Gogo to continue its operations without disruption.
Financially, Gogo has demonstrated consistent growth. As of March 31, 2024, Gogo reported 7,136 business aircraft flying with its broadband ATG systems onboard, 4,110 of which are equipped with a Gogo AVANCE L5 or L3 system, and 4,285 aircraft with narrowband satellite connectivity installed. The company’s strategic investments are expected to yield substantial free cash flow in the coming years, especially with the forthcoming launches of Gogo 5G and Galileo.
Gogo's commitment to innovation is further evidenced by its state-of-the-art virtual flight simulator, which accelerates the development of its 5G software. Additionally, Gogo Galileo has achieved end-to-end connectivity using the HDX antenna on the Eutelsat OneWeb LEO satellite network, positioning it for a commercial launch later this year.
Gogo's extensive network of authorized dealers, partnerships with leading OEMs, and robust technological advancements ensure that it remains at the forefront of the business aviation connectivity market. Whether it's through providing reliable Wi-Fi for business travelers or enhancing in-flight entertainment options, Gogo continues to deliver exceptional value to its customers and stakeholders.
Jet Edge has partnered with Gogo Business Aviation (NASDAQ: GOGO) to upgrade its fleet to the AVANCE L5 connectivity system, enhancing in-flight 4G Wi-Fi capabilities. This long-term collaboration ensures that Jet Edge will be the first private jet charter operator to equip its entire fleet with the AVANCE L5 system by Q3-2021. Over 20 aircraft have already been upgraded, providing passengers with improved streaming services and overall faster internet speeds. The partnership signifies Jet Edge's commitment to delivering a superior private aviation experience.
Gogo Inc. (NASDAQ: GOGO) announced a significant convertible debt exchange and refinancing initiative. GTCR will convert $105.7 million of Gogo's convertible notes into 19.1 million shares, increasing their ownership to 28.6%. This equitization reduces Gogo's total debt to approximately $1.078 billion, down $135 million from 2020. Gogo also plans to refinance $975 million in senior secured notes. CEO Oakleigh Thorne emphasized this strategy will improve financial flexibility and lower interest expenses, positioning Gogo to capitalize on growth opportunities in the business aviation market.
Gogo (NASDAQ: GOGO) reported its Q4 and full-year 2020 financial results amid a recovering business aviation market. Total Q4 revenue was $77.6 million, a 17% sequential increase but down 10% year-over-year, driven by COVID-19 impacts. The net loss was $16.1 million, with Adjusted EBITDA at $19.3 million. Cash reserves stood at $435.3 million. Full-year revenue decreased 13% to $269.7 million. For 2021, Gogo anticipates revenue between $300 million and $320 million and aims for a 10% CAGR from 2020 to 2025, alongside improving financial metrics.
Gogo Inc. (NASDAQ: GOGO) will report its fourth quarter 2020 financial results on March 11, 2021, before market opens. A conference call for analysts will follow at 8:30 a.m. ET. Gogo is a leading provider of network and broadband connectivity for business aviation, with over 1,700 aircraft utilizing its AVANCE systems and 5,577 aircraft equipped with air-to-ground systems as of September 30, 2020. Investors can access the call via phone or at their Investor Relations website.
Gogo Inc. (NASDAQ: GOGO) announced the retirement of Ronald LeMay as Chairman, effective December 31, 2020. Oakleigh Thorne will succeed him, continuing as President and CEO. Hugh Jones has been appointed as Lead Independent Director. Thorne recognized LeMay's 14-year tenure, highlighting his pivotal role during challenges, particularly the sale of Gogo's CA business to Intelsat. The board will now comprise eight directors. Gogo remains a leader in business aviation connectivity solutions, with over 5,577 aircraft using its systems by September 30, 2020.
Gogo (NASDAQ: GOGO) anticipates ending 2020 with over 5,700 air-to-ground (ATG) subscribers, a slight increase from 5,669 at the year's start. Despite the challenges posed by the COVID-19 pandemic, Gogo's subscriber base rebounded, with 78% of those who suspended their service resuming it. The company launched several enhancements, including a new AVANCE system and connectivity upgrades, which contributed to its growth. Gogo also maintained operational efficiency, ensuring no delays in equipment deliveries or repairs during the pandemic.
Gogo's AVANCE L3 inflight connectivity system is now installed on over 500 business aircraft, emphasizing its growing importance in aviation connectivity. Launched in January 2018, the AVANCE L3 has been on more than 120,000 flights and nearly 700 systems have been shipped. The system caters to smaller aircraft with customizable connectivity options, allowing users to stay connected via email and voice calls. Demand for inflight connectivity has surged, especially during the pandemic, positioning the AVANCE L3 as a necessary travel tool.
Gogo (NASDAQ: GOGO) has launched Gogo Vision 360, a premium inflight entertainment (IFE) service for business aviation. This service, available via the AVANCE 4.2 software update, allows unlimited streaming of movies, TV shows, and news at a fixed monthly price, simplifying costs associated with inflight media. The service features a new 3D moving map developed in partnership with FlightPath3D, which enhances the passenger experience with interactive flight information. Gogo Vision 360 has packages starting from $849 per month, with current users nearing 900 active subscribers.
On December 1, 2020, Gogo announced the successful sale of its Commercial Aviation business to Intelsat for $400 million in cash. This transaction strengthens Gogo's financial position, reducing net debt and enabling investment in growth opportunities like Gogo 5G. Post-sale, Gogo has about $460 million in cash and $770 million in net debt. The company plans a comprehensive refinancing by May 2021 to align its balance sheet and reduce interest expenses. Gogo remains focused on the business aviation market, leveraging its ATG network and proprietary spectrum.
Gogo (NASDAQ: GOGO) reported Q3 2020 results with total revenue of $66.5 million, down 18% year-over-year but up 22% sequentially. The company incurred a net loss of $8.9 million and had Adjusted EBITDA of $30.2 million. Notably, the Commercial Aviation segment revenue is now categorized as discontinued operations. Cash and cash equivalents decreased to $117.5 million. Gogo continues to prepare for the sale of its Commercial Aviation division to Intelsat, expected to close by Q1 2021, which aims to improve liquidity and reduce debt.
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