54.3 F
San Diego
Thursday, Mar 28, 2024
-Advertisement-

Viasat Q1 Revenue Hits $537M, Buoyed By Several Factors

Rich Valera

Carlsbad-based satellite communications specialist Viasat Inc. reported a net loss of $11.5 million on markedly increased revenue of $537 million in the quarter ended June 30. The company beat an analyst consensus opinion that Viasat would generate some $506 million in revenue.

Though Viasat (Nasdaq: VSAT) reported a good quarter and analysts agreed, the grounding of the Boeing 737 MAX aircraft created some drag on earnings. In-cabin Wi-Fi is an important piece of Viasat’s business, but the company is diversified beyond that.

Earlier than expected government contracts made for a good quarter, wrote analyst Richard Valera of Needham & Co. LLC.

Mark Dankberg

Viasat’s revenue grew by 22% from the year-ago quarter, when it was $439 million. The company was also able to pare back its net loss by 66%. In the year-ago quarter, it took a $34 million loss.

“Our fiscal year 2020 financial outlook benefits from, and builds on, the momentum from a record fiscal year 2019,” CEO Mark Dankberg said in a statement. The company said it had an order backlog of $1.8 billion, which is up 13% year-over-year, and that it planned to grow globally through prudent investments.

In-Flight Connectivity Business Grows

Shawn Duffy

Viasat was providing in-flight internet connectivity to 1,335 aircraft at the end of the last quarter, up 76% from the same time last year.

After regulators from several governments grounded Boeing’s 737 MAX aircraft early this year because of safety concerns, Viasat is not providing service to 46 737 MAX aircraft that have already been fitted with Viasat in-flight Wi-Fi electronics. The groundings may cost Viasat some $5 million to $10 million during the fiscal year, CFO Shawn Duffy told investors during a conference call. That assumes the aircraft return to service by the end of 2019, though Duffy said there is still considerable uncertainty about when the aircraft will return to service. Viasat is monitoring the situation carefully, she said.

Though the 737 MAX issue is a near-term headwind, Viasat’s “deal pipeline [is] healthy,” wrote Valera, the analyst from Needham. As of June 30, Viasat said it expected to install equipment in 510 more aircraft.

After the quarter was over, in early August, Viasat announced it booked a deal with JetBlue to put its in-flight Wi-Fi system on 70 new planes that JetBlue is ordering from Airbus. They are the A220-300 model, which the aircraft builder will start delivering in 2020. Financial terms of the deal were not disclosed. Viasat also has an option to install the system on 50 additional A220-300s.

Two Segments Show Gains

Revenue for Viasat’s Commercial Networks segment was $79 million, down 17 percent from the same quarter of last year. The company said accelerated deliveries to American Airlines contributed to higher-than-normal business last year.

Viasat’s Satellite Services segment — which serves customers in their homes as well as those in the air — achieved record high revenue of $196.8 million, up 28% from the same quarter of last year. Viasat has 587,000 subscribers in the United States. It has expanded in Mexico and is poised to grow in Brazil.

Viasat’s Government Services segment grew 37% year over year to $261.2 million. Sophisticated combat radios for the U.S. government and allies drove those numbers.

The corporation gets about half its revenue from products and the other half from services.

Viasat’s adjusted EBITDA was $96.8 million in the recently ended quarter — better than the $95 million expected by analysts. Adjusted EBITDA grew 115% from the $45 million in the same quarter one year ago.

Duffy noted capital expenditures increased about $25 million to $185.8 million during the first quarter, in part because of work on the ViaSat-3 constellation. Viasat plans to launch three satellites that will provide coverage for nearly every point on earth.

-Advertisement-

Featured Articles

Kratos to Deliver Drones Under $58M Order

GA-ASI to Provide Aircraft to Taiwan

Autonomous Vehicle Tech Rides Big Rigs

-Advertisement-
-Advertisement-

Related Articles

-Advertisement-
-Advertisement-
-Advertisement-