Financial Data and Key Metrics Changes - Gogo's total revenue in Q2 was $226 million, up 1% year-over-year and down about 2% sequentially [35] - Total service revenue increased 137% over the prior year to $194 million, but declined 2% compared to the prior quarter [36] - Adjusted EBITDA for Q2 was $61.7 million, with an adjusted EBITDA margin of 27.3% [42] Business Line Data and Key Metrics Changes - Advanced ATG aircraft online grew nearly 14% year-over-year, now comprising more than 71% of the total ATG fleet [36] - Total equipment revenue was $32.1 million, up 59% year-over-year, with Advanced Equipment shipments increasing 19% [38] - Gogo set a record for APG shipments in the quarter with 405 units, including 276 Advanced and 129 C1 units [12] Market Data and Key Metrics Changes - The business aviation sector saw a strong OEM performance, with major OEMs increasing aircraft deliveries by 11% year-over-year [18] - Demand for connectivity in business aviation and military government mobility is surging, with only 24% of global business aircraft currently having broadband connectivity [21] - The military sector is transitioning to broadband solutions, with significant opportunities for Gogo's products [29] Company Strategy and Development Direction - Gogo aims to grow its share in a highly unpenetrated market by enhancing customer relationships and delivering new products [21][22] - The company is focused on leveraging its multi-orbit, multi-band approach to provide competitive advantages in the market [32] - Gogo plans to capitalize on the increased demand for in-flight connectivity through strategic investments in new technologies and partnerships [22][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving $30 million to $35 million in synergy cost savings, up from previous estimates [43] - The company anticipates solid free cash flow growth in 2026, driven by new product service revenue and reduced product program spending [34] - Management noted that the military market is expected to grow significantly, particularly with the U.S. Air Force's push for satellite communications [29] Other Important Information - Gogo's cash balance at the end of Q2 was $102.1 million, with a net leverage ratio of 3.2 times [44] - The company has $12.1 million remaining on its $50 million share repurchase authorization [46] - Gogo expects to see a decline in free cash flow in 2025, but anticipates this will be the trough year [47] Q&A Session Summary Question: Timeline for return to growth in ATG - Management indicated that while net ATG numbers are expected to be down this year, they are hopeful for a rebound with the C1 and 5G launch [56][57] Question: Competitive losses to StarLink - Management clarified that the current suspensions are not due to competitive losses but are part of normal transitions ahead of product cycles [58][59] Question: Long-term thoughts on GEO market - Management noted that while ARPA may contract slightly, the GEO business is performing well, supported by strong OEM relationships [60][61] Question: CapEx guidance change - Management explained that the change in CapEx guidance is related to the acceleration of the rip and replace program, which is fully reimbursed [80][81] Question: Delays in MilGov awards - Management acknowledged that awards are moving slower than expected but expressed optimism for increased activity in Q4 [86][90]