Gogo increases number of commercial aircraft online to 3,109

Gogo President and CEO Michael Small.
Gogo President and CEO Michael Small.

Gogo has announced its financial results for the quarter ended June 30, 2017, showing a 9% increase in commercial aircraft online to 3,109.

It also showed a 17% increase in air-to-ground (ATG) business aircraft online to 4,453, and increased customer usage across all segments.

While revenue increased to a record $172.8 million, up 17% from Q2 2016, it also showed its net loss increased to $44.2 million, a 10% increase from Q2 2016.

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) decreased to $9.9 million, down 31% from Q2 2016.

Gogo also confirmed that its 2Ku inflight connectivity product is now installed on 248 aircraft with nine airlines globally and reaffirmed its 2Ku installation guidance of 450 to 550 aircraft in 2017.

Michael Small, Gogo’s President and CEO, said: “We launched our 2Ku service on five new airlines in the quarter and are on plan to meet our targeted increase in installations during the second half of the year.

While these installs require up-front investment, they will all produce positive returns in the future.”

Barry Rowan, Gogo’s Executive Vice President and CFO, added: “Our planned increase in investments in the second quarter lay the foundation for future growth in revenue and profitability.

We expect Adjusted EBITDA to increase substantially in the second half of 2017 and into 2018, and we are on track to generate positive free cash flow in 2019.”

Gogo launched its 2Ku service on five airlines: Air Canada Rouge, British Airways, JTA, Virgin Atlantic, and Virgin Australia.

It said the first OEM installation of 2Ku on an Airbus A350 had been completed and is ready for delivery to Delta.

Gogo also said its next-generation ATG system has achieved speeds of 134Mbps in the lab and remains on track for its expected deployment in 2018. Gogo also recently introduced a new satellite modem capable of delivering more than 16 times the throughput of the existing satellite modem.

Revenue for its Commercial Aviation – Rest of World (CA-ROW) sector doubled year-over-year for the second consecutive quarter and ARPA grew 56% to more than $226,000 on an annualised basis as passenger demand continued to grow.

Aircraft online reached 318, up 69 aircraft from Q2 2016. CA-ROW also had approximately 620 net new 2Ku contracts awarded, but not yet installed, aircraft as of June 30, 2017.

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