Core Insights - Iridium Communications Inc. (IRDM) has partnered with Eutelsat Group's subsidiary Eutelsat America Corp. and OneWeb Technologies Inc. to provide Iridium Certus and Iridium Satellite Time and Location (STL) services to U.S. government clients [1] - The partnership aims to enhance government services with a GNSS-resilient LEO Ku-Band/L-band solution, improving connectivity and remote terminal management capabilities [2] - Iridium's acquisition of Satelles, Inc. has strengthened its STL service offerings, which are crucial in areas lacking GPS or GNSS signals, with a target of achieving $1 billion in annual service revenues by 2030 [3] Group 1: Partnership and Services - EACOWT will deliver Iridium Certus and STL services to U.S. government clients through contracts with the U.S. Space Force [1] - The combination of OneWeb Technologies' satellite network and Iridium's services provides a strong alternative for positioning, navigation, and timing (PNT) information [2] Group 2: Financial Performance and Projections - In Q3 2024, IRDM's total service revenues increased by 5% year over year to $159.9 million, driven by a growing subscriber base [3] - The Iridium STL business is projected to generate over $100 million in service revenue annually by 2030 [3]

Core Viewpoint - Iridium Communications (IRDM) reported a significant improvement in earnings for Q3 2024, with earnings per share (EPS) of 21 cents, surpassing the Zacks Consensus Estimate by 5% and recovering from a loss of 1 cent per share in the same quarter last year [1][2]. Financial Performance - Quarterly revenues reached $212.8 million, reflecting an 8% increase year-over-year, driven by growth in the Commercial service segment and Government Engineering and support services [2][4]. - Total service revenues rose 5% year-over-year to $159.9 million, contributing 75% to total revenues, supported by strong recurring revenues from increased subscriber engagements [3][6]. - Subscriber Equipment revenues increased by 9% to $22.2 million, while Engineering and support revenue surged 22% to $30.7 million due to heightened activity with the U.S. government [4][6]. Operational Metrics - Total operating expenses decreased to $157.9 million from $169.5 million in the prior-year quarter, primarily due to lower depreciation and amortization costs [6]. - Operational EBITDA (OEBITDA) increased by 2.5% year-over-year to $124.4 million, with operating income rising to $54.9 million from $28.2 million in the previous year [6]. Subscriber Growth - As of September 30, 2024, the company had 2,482,000 billable subscribers, an 11% increase from 2,236,000 in the prior-year quarter, with commercial IoT data subscribers growing 14% to 1.9 million [6]. - The commercial sector contributed significantly to subscriber growth, with 2,341,000 billable commercial subscribers, up from 2,094,000 in the previous quarter [6]. Liquidity and Share Repurchase - As of September 30, 2024, total cash and cash equivalents were $159.6 million, with net debt of $1.7 billion [6]. - In Q3 2024, the company repurchased 4.7 million shares worth $128.6 million and announced an additional $500 million share repurchase program through December 31, 2027 [7]. 2024 Outlook - Based on the strong Q3 performance, Iridium revised its full-year 2024 outlook, now expecting total service revenue growth of about 5%, up from the previous guidance of 4-6% [8]. - The company anticipates full-year OEBITDA to be between $465 million and $470 million, an increase from the previous range of $460 million to $470 million [8].

Financial Data and Key Metrics - Total revenue for Q3 2024 was $212.8 million, up 8% YoY, driven by growth in commercial business lines and strength in engineering and support revenue [15] - Operational EBITDA reached a record $124.4 million in Q3, with service revenue expansion being the primary driver [16] - Service revenue increased 6% YoY to $133.3 million, reflecting momentum in IoT and growth in hosted payload and other data services [16] - Commercial voice and data revenue rose 3% YoY to $57.7 million, driven by subscriber growth and demand for Push-to-talk services [16] - Commercial IoT revenue grew 14% YoY to $43.7 million, partly due to a 2-year contract with a large partner [17] - Government service revenue increased slightly to $26.5 million, reflecting a step-up in revenue under the EMSS contract with the US government [21] - Subscriber equipment revenue was up 9% YoY to $22.2 million, reflecting normalized demand after inventory buildup [21] - Engineering and support revenue rose 22% YoY to $30.7 million, driven by increased activity with the US government and the Space Development Agency [22] - Full-year 2024 guidance for service revenue growth was updated to approximately 5%, with operational EBITDA expected between $465 million - $470 million [23] Business Line Performance - Commercial IoT: Revenue increased 14% YoY to $43.7 million, driven by demand for personal satellite communications and industrial services [17] - Commercial broadband: Revenue held steady at $15.5 million, transitioning to a safety and companion service [19] - Hosting and other data services: Revenue rose 9% YoY to $16.4 million, primarily due to new revenue from Iridium PNT [20] - Government services: Revenue increased slightly to $26.5 million, reflecting higher bill rates under the EMSS contract [21] - Subscriber equipment: Revenue grew 9% YoY to $22.2 million, reflecting normalized demand after inventory buildup [21] Market Performance - Iridium NTN Direct: Progress on Project Stardust, with Iridium NTN Direct set to launch in early 2026, integrating Iridium technology into 3GPP Release 19 [7][8] - Garmin's inReach Messenger Plus: Launched in mid-September, leveraging Iridium Messaging Transport (IMT) for enhanced consumer satellite communication [9] - Iridium GMDSS for Mariners: New terminals combining broadband technology with maritime safety services (GMDSS, LRIT, SSAS) set to launch this quarter [10] - Space Development Agency (SDA) contract: Total contract value increased to approximately $400 million, with $260 million remaining to be recognized through 2029 [11] - Iridium PNT: Swift integration of Satelles, showcasing PNT capabilities at industry events, with growing interest from maritime and other users in Europe and Asia [12][13] Strategic Direction and Industry Competition - Iridium is positioning itself as a leader in IoT and mobility applications, expanding into new markets like PNT and standards-based IoT [4] - The company is actively returning capital to shareholders, with $146 million returned in Q3 through dividends and share repurchases [4] - Iridium's L-band cross-linked constellation and global partner ecosystem are key differentiators in the satellite communications industry [6] - The company is focused on direct-to-device (D2D) offerings, with Iridium NTN Direct set to integrate into industry-standard chipsets [7][8] - Iridium is addressing competition by leveraging its global, reliable network, which complements regional solutions like Starlink [36][38] Management Commentary on Operating Environment and Future Outlook - Management remains confident in Iridium's market position and growth opportunities, with a focus on expanding the ecosystem of global partners [5] - The company is on track to achieve the higher end of its full-year guidance, driven by strong revenue and subscriber growth [4] - Iridium expects to generate $1 billion in service revenue by 2030, supported by new product launches and strategic initiatives [14] - Management highlighted the growing threat of GPS jamming and spoofing, with Iridium PNT positioned as a secure alternative [13] - The company is optimistic about the adoption of Iridium NTN Direct and other new technologies, which are expected to drive growth in the coming years [7][8] Other Important Information - Iridium repurchased 4.7 million shares in Q3, reducing the outstanding share count by 4%, and has returned over $1 billion to shareholders since 2021 [5][24] - The company ended Q3 with a cash balance of $159.6 million and expects to return approximately $65 million to shareholders through dividends in 2024 [23][24] - Capital expenditures in Q3 were $18.6 million, with full-year 2024 CapEx expected to be around $70 million, primarily for new product development like Iridium NTN Direct [25] - Pro forma free cash flow for 2024 is projected at approximately $300 million, with a conversion rate of EBITDA to free cash flow of 64% [26] Q&A Session Summary Question: EBITDA guidance and spending trends on directed devices [32] - Iridium continues to invest in directed devices, with spending reflected in CapEx and R&D [32] - Project Stardust is progressing faster than expected, with Iridium NTN Direct set to launch in 2026 [33] Question: Service revenue growth and competition [35] - Iridium's service revenue growth is expected to be around 5% for 2024, with strong performance in Q3 [35] - The company differentiates itself through its global, reliable network, which complements regional solutions like Starlink [36][38] Question: ARPU trends and SDA contract impact [41] - Broadband ARPU is down slightly YoY, but expected to stabilize as the service transitions to a companion role [43] - The SDA contract is expected to contribute to engineering support revenue growth, with $260 million remaining to be recognized through 2029 [42] Question: IoT customer trends and revenue impact [49] - IoT revenue from a key customer is expected to grow materially in 2025 and 2026, driven by contractual agreements and product portfolio expansion [49] Question: Broadband segment performance and outlook [74] - Broadband revenue was better than expected in Q3, with the segment expected to return to growth in 2025 [74][75] Question: Satelles business development activity [77] - Satelles has seen increased business development activity due to growing threats of GPS jamming and spoofing, with expanded availability in Europe and Asia [77][79] Question: Aviation service certification and growth potential [67] - Iridium is on track to achieve aviation safety service certification in 2024, with products expected to launch in 2025 [67][68] Question: Maritime market dynamics and competition [70] - Iridium is positioning itself as the preferred companion service for maritime broadband, with new terminals combining safety and backup functions [70][71]

Core Insights - Iridium Communications reported revenue of $212.77 million for Q3 2024, reflecting a 7.7% increase year-over-year and a surprise of +3.45% over the Zacks Consensus Estimate of $205.68 million [1] - Earnings per share (EPS) for the quarter was $0.21, compared to -$0.01 in the same quarter last year, resulting in an EPS surprise of +5.00% against the consensus estimate of $0.20 [1] Revenue Performance - Total revenue from subscriber equipment was $22.17 million, slightly below the estimated $22.54 million, but showing an 8.6% increase year-over-year [1] - Service revenue reached $159.86 million, exceeding the average estimate of $157.10 million, with a year-over-year growth of 5.2% [1] - Engineering and support service revenue was $30.75 million, surpassing the estimate of $25.96 million, marking a significant year-over-year increase of 21.9% [1] Subscriber Metrics - Average Revenue Per User (ARPU) for commercial voice and data was $46, slightly below the estimate of $46.31 [1] - ARPU for commercial IoT data was $7.79, exceeding the estimate of $7.56 [1] - ARPU for commercial broadband was $309, significantly higher than the estimated $280.57 [1] - Total net billable subscriber additions were 69 thousand, below the average estimate of 99.82 thousand [1] Service Revenue Breakdown - Commercial service revenue was $133.31 million, above the estimate of $130.46 million, with a year-over-year increase of 6.3% [1] - Government service revenue was $26.55 million, slightly above the estimate of $26.51 million, reflecting a minimal year-over-year change of 0.2% [1] - Hosted payload and other data service revenue was $16.37 million, exceeding the estimate of $14.67 million, with a year-over-year growth of 9% [1] Stock Performance - Iridium's shares have returned +10.1% over the past month, outperforming the Zacks S&P 500 composite's +3.8% change [1] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [1]

Iridium Communications (IRDM) came out with quarterly earnings of $0.21 per share, beating the Zacks Consensus Estimate of $0.20 per share. This compares to loss of $0.01 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 5%. A quarter ago, it was expected that this satellite phone company would post earnings of $0.19 per share when it actually produced earnings of $0.27, delivering a surprise of 42.11%. Over the last four quart ...

Subscriber Growth - As of September 30, 2024, the company had approximately 2,482,000 billable subscribers, an increase of 246,000, or 11%, from 2,236,000 billable subscribers as of September 30, 2023[71]. Revenue Performance - Total revenue for the three months ended September 30, 2024, was $212.8 million, an increase of $15.2 million, or 8%, compared to $197.6 million for the same period in 2023[75]. - Total revenue for the nine months ended September 30, 2024, was $617.7 million, an increase of $21.7 million, or 4%, compared to the prior year[93]. - Commercial services revenue increased by $24.5 million, or 7%, for the nine months ended September 30, 2024, primarily driven by increases in IoT and voice and data service revenue[96]. - Commercial IoT revenue increased by $19.8 million, or 19%, for the nine months ended September 30, 2024, driven by a 14% increase in IoT billable subscribers[96]. Operating Income and Expenses - Operating income for the three months ended September 30, 2024, was $54.9 million, a significant increase of $26.7 million, or 95%, from $28.2 million in the prior year[75]. - Total operating expenses decreased by $11.5 million, or 7%, to $157.9 million for the three months ended September 30, 2024, from $169.4 million in the prior year[75]. - Selling, general and administrative expenses increased by $10.6 million, or 32%, for the three months ended September 30, 2024, primarily due to costs related to the acquisition of Satelles and higher headcount costs[85]. - Research and development expenses increased by $1.2 million, or 23%, to $6.2 million for the three months ended September 30, 2024[75]. - Research and development expenses increased by $5.4 million, or 37%, for the nine months ended September 30, 2024, due to increased spending on device-related features[102]. Net Income - The company reported a net income of $24.4 million for the three months ended September 30, 2024, compared to a net loss of $1.6 million in the same period of the prior year[75]. - Net income improved to $76.4 million for the nine months ended September 30, 2024, compared to a net loss of $22.6 million for the prior year period[109]. - Net income was $24.4 million for the three months ended September 30, 2024, compared to a net loss of $1.6 million for the prior year period, reflecting a $26.1 million increase in net income[91]. Cash Flow and Financial Position - Total cash and cash equivalents increased to $159.6 million as of September 30, 2024, up from $71.9 million as of December 31, 2023[110]. - Cash provided by operating activities was $271.2 million for the nine months ended September 30, 2024, an increase of $44.1 million compared to the prior year[115]. - Net cash provided by operating activities increased by $44.1 million for the nine months ended September 30, 2024, primarily due to a $40.6 million increase in working capital[116]. - Net cash used in investing activities increased by $89.1 million, mainly due to the acquisition of Satelles on April 1, 2024, with capital expenditures expected to average approximately $60.0 million per year through 2030[117]. - Net cash used in financing activities decreased by $232.2 million, primarily due to an additional $325.0 million in borrowings under the Term Loan[118]. Acquisitions and Investments - The company acquired Satelles, Inc. on April 1, 2024, to enhance its satellite-based time and location services[71]. Debt and Interest Expense - The outstanding aggregate balance under the Term Loan was $1,812.3 million as of September 30, 2024, with interest rates tied to SOFR plus 2.25%[121]. - Interest expense, net decreased by $10.4 million, or 30%, for the three months ended September 30, 2024, primarily due to lower fees associated with term loan refinancing[88]. - For every 25 basis points increase in SOFR above the Cap, the company expects an additional $2.0 million in annual interest expense related to the unhedged portion of the Term Loan[121]. Seasonal Trends - The company expects seasonal usage changes to affect results, with March through October being peak months for commercial voice services revenue[119]. Accounting Policies - There have been no changes to critical accounting policies and estimates from those described in the Annual Report for the year ended December 31, 2023[120]. - The company performs credit evaluations of customers and records reserves for estimated credit losses on accounts receivable[121]. - The company has experienced no significant changes in its financial condition or results of operations that would affect its accounting estimates[120].

Financial Performance - Net income for Q3 2024 was $24.4 million, compared to a net loss of $1.6 million in Q3 2023, driven by increased service revenue, engineering and support revenue, and equipment sales[1] - Total revenue for Q3 2024 reached a record $212.8 million, with service revenue accounting for $159.9 million (75% of total revenue), up 5% year-over-year[1] - Total service revenue for Q3 2024 increased by 5% to $159.855 million compared to $151.950 million in Q3 2023[16] - Operational EBITDA for Q3 2024 increased by 3% to $124.412 million compared to $121.266 million in Q3 2023[18] - Net income for Q3 2024 was $24.446 million, a significant improvement from a net loss of $1.642 million in Q3 2023[16] - Total revenue for the first nine months of 2024 grew by 4% to $617.691 million compared to $595.983 million in the same period of 2023[17] - Full-year 2024 OEBITDA guidance was updated to $465-$470 million, up from $463.1 million in 2023, with total service revenue growth expected at 5%[11] Revenue Breakdown - Commercial service revenue was $133.3 million, up 6% year-over-year, with IoT data revenue growing 14% to $43.7 million[3][4] - Government service revenue remained stable at $26.5 million, with the EMSS Contract annual rate increasing to $107 million starting September 15, 2024[7] - Equipment revenue increased 9% year-over-year to $22.2 million, while engineering and support revenue rose 22% to $30.7 million[8][9] - Commercial service revenue grew by 6% to $133.309 million in Q3 2024, driven by a 14% increase in IoT data revenue[18] - Government service revenue remained flat at $26.546 million in Q3 2024 compared to Q3 2023[18] - Subscriber equipment revenue increased by 9% to $22.169 million in Q3 2024[18] - Engineering and support service revenue rose by 22% to $30.747 million in Q3 2024, with government segment growing 24%[18] Subscriber Metrics - Total billable subscribers grew 11% year-over-year to 2,482,000, with commercial IoT data subscribers increasing 14% to 1,902,000[2][4] - Total billable subscribers increased by 11% to 2,482,000 as of September 30, 2024, compared to 2,236,000 in 2023[19] - Commercial IoT data subscribers grew by 14% to 1,902,000, up from 1,667,000 in 2023[19] - Government IoT data subscribers decreased by 4% to 78,000, down from 81,000 in 2023[19] - Commercial broadband subscribers increased by 1% to 16.7 million, up from 16.5 million in 2023[19] - Total net billable subscriber additions for commercial services decreased by 26% to 70,000 in Q3 2024, compared to 94,000 in Q3 2023[19] - Total government voice and data and IoT data service subscribers decreased by 1% to 141,000, down from 142,000 in 2023[19] - Net billable subscriber additions for government services decreased by 200% to -1,000 in Q3 2024, compared to 1,000 in Q3 2023[19] ARPU (Average Revenue Per User) - ARPU for commercial IoT data decreased by 1% to $7.79 in Q3 2024, compared to $7.90 in Q3 2023[19] - ARPU for commercial broadband decreased by 4% to $309 in Q3 2024, compared to $322 in Q3 2023[19] - ARPU for commercial voice and data remained flat at $46 in Q3 2024, unchanged from Q3 2023[19] Capital and Debt Management - The company repurchased 4.7 million shares (4% of outstanding shares) for $128.6 million in Q3 2024, with $552.2 million remaining authorized for repurchase[10] - Net leverage stood at 3.5x trailing twelve months OEBITDA, with a target to reduce it below 2.0x by the end of the decade[11] - Capital expenditures for Q3 2024 increased to $18.616 million from $11.998 million in Q3 2023[18] - Net debt as of Q3 2024 stood at $1.652 billion, up from $1.432 billion in Q3 2023[18]

MCLEAN, Va., Oct. 17, 2024 /PRNewswire/ -- Iridium Communications Inc. (Nasdaq:IRDM) ("Iridium"), a leading provider of global voice and data satellite communications, today reported financial results for the third quarter of 2024 and updated its full-year 2024 outlook. Net income was $24.4 million, or $0.21 per diluted share, for the third quarter of 2024, as compared to net loss of $1.6 million, or $0.01 per diluted share, for the third quarter of 2023. Operational EBITDA ("OEBITDA")(1) for the third quar ...

MCLEAN, Va., Oct. 15, 2024 /PRNewswire/ -- Iridium Communications Inc. (Nasdaq: IRDM), a leading provider of global voice and data satellite communications, today announced the Space Development Agency (SDA) has awarded the General Dynamics Mission Systems (GDMS) and Iridium team a $491.6 million contract modification in support of its Ground Management and Integration (GMI) program for the Proliferated Warfighter Space Architecture (PWSA). Of this amount, Iridium's share has a value of $239 million over fi ...

Iridium Communications (IRDM) is slated to release third-quarter 2024 earnings on Oct. 17, before market open. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar. The Zacks Consensus estimate for revenues is pegged at $205.7 million, indicating an increase of 4.1% from the year-ago level. The consensus estimate for earnings per share is pegged at 20 cents, unchanged in the past 60 days. In the year-ago quarter, the company reported a loss of 1 cent. IRDM's earnings beat the Zacks Conse ...