Financial Data and Key Metrics Changes - Service revenue for Q3 was $25.4 million, a 10% increase from the prior quarter and a 4% increase from Q3 2024 [5] - Airtime gross margin was 31.9%, down by 3.9% compared to the prior quarter gross margin of 35.8% [8] - Adjusted EBITDA for the quarter was $1.4 million, compared to $2.7 million in Q2 2025 [10] - Ending cash balance was $72.8 million, up approximately $16.9 million from the beginning of the quarter [10] Business Line Data and Key Metrics Changes - Total subscribing vessel count increased by 11% to approximately 9,000 compared to the second quarter, and up 26% year-to-date [5] - Approximately 1,600 satellite communication terminals were shipped in Q3, a new record [5] - Reported Q3 product gross profit was negative $6.8 million, including a $5.5 million write-down of VSAT inventory [9] Market Data and Key Metrics Changes - Strong demand for both standalone LEO services and hybrid installations was noted, with significant growth driven by Starlink and OneWeb services [5][6] - The acquisition of a maritime communications customer base in the Asia-Pacific region is expected to bring on board more than 800 vessels [7] Company Strategy and Development Direction - The company is focusing on LEO Airtime revenue and subscriber growth, which has yielded positive results [4] - The sale of the Rhode Island facility generated approximately $8 million in net proceeds, indicating a commitment to strong cost control [4][10] - The company is pursuing strategic growth opportunities, including the acquisition of customer agreements and assets from a satellite service provider [6][7] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing successful growth in recurring revenue service business and strong LEO margins [11] - The company expects GEO bandwidth commitments to decline significantly from January 2026, which should reduce pressure on margins [8] Other Important Information - The company has maintained flat operating expenses and reduced capital expenditures compared to the second quarter of 2025 [4] - The strategic acquisition is intended to expand the customer base and broaden the product and service portfolio [7] Q&A Session Summary Question: What is driving the growth in the LEO business? - Demand is evenly spread across regions and vessel types, with some competitive wins and new installations contributing to growth [13][15] Question: How is the company managing hardware inventory and pricing in a dynamic environment? - The company is managing inventory carefully and has an understanding with Starlink regarding price concessions [16] Question: Will the acquisition lead to a one-time jump in vessel numbers in Q4? - Yes, over 500 vessels will be reflected in Q4 numbers, with higher margins expected from those already receiving service [31] Question: Are there notable trends due to tariffs or geopolitical situations affecting demand? - No significant impact from tariffs or geopolitical environment has been observed [34]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $26.9 million, a decrease of approximately 4.5% from Q4 2023, but effectively flat sequentially when excluding a $1.7 million revenue reduction from the U.S. Coast Guard [16][17] - Airtime gross margin for Q4 was 28.2%, down from 36.5% in the prior quarter, while excluding depreciation, it was 41.4%, compared to 48.6% in the prior quarter [21] - Adjusted EBITDA for the quarter was $0.5 million, with capital expenditures of $0.8 million, resulting in adjusted EBITDA less CapEx of negative $0.3 million [23][24] - Ending cash balance was $50.6 million, up approximately $0.8 million from the beginning of the quarter [25] Business Line Data and Key Metrics Changes - The company shipped over 1,000 Starlink units and approximately 200 VSAT terminals in Q4, marking the fourth consecutive quarterly record for terminal shipments [8][9] - Active maritime Starlink terminals reached over 2,300 by the end of Q4, with about 1,000 terminals awaiting activation [9][10] - Non-U.S. Coast Guard GEO Airtime revenue contracted by around $1 million, offset by increased Starlink revenues [16] Market Data and Key Metrics Changes - The company is experiencing strong demand for hybrid connectivity, with roughly 50% of Starlink terminals activated alongside new or existing VSAT terminals [11] - The CommBox Edge communication gateway saw Q4 activations double compared to Q3, indicating strong demand [12] Company Strategy and Development Direction - The company is transitioning from a focus solely on VSAT services to offering multi-orbit multichannel solutions, including LEO solutions like Starlink and high-speed cellular solutions [7] - Strategic initiatives such as the addition of OneWeb to the satellite communications service portfolio and partnerships with companies like Seaspan are expected to position the company well for future growth [15] Management's Comments on Operating Environment and Future Outlook - Management anticipates that Starlink and other new revenue sources will outpace the decrease in GEO airtime revenue, indicating a focus on growth despite current revenue contraction [17] - The company has implemented cost reduction initiatives, bringing recurring operating expenses down by almost 10% for the full year [17] - Management believes the company is in a stronger position now than a year ago and is on a path toward renewed growth and profitability [19] Other Important Information - The company is preparing to roll out new CommBox Edge capabilities, including cybersecurity features [13] - The Fusion eSIM technology is enhancing the company's cellular service offerings, allowing for seamless global connectivity [14] Q&A Session Summary Question: Expectations for Starlink terminal activations - The company shipped 1,000 terminals in Q4, with approximately 700 Starlink Maritime Terminals activated during the quarter, and there are about 1,000 terminals awaiting activation [28][29] Question: Reasons for activation delays - Delays in activation can be attributed to OEMs installing terminals on boats not yet taken over by owners, as well as higher inventory levels compared to VSAT [33] Question: Customer base for Starlink dishes - Activations include both new and existing customers, with new customers often transitioning from lower bandwidth systems [35] Question: Market response to emerging satellite constellations - Management anticipates a market response to new constellations but believes it is still early for significant impact [37] Question: Challenges with terminal pricing relative to competitors - While OneWeb terminals are more expensive than Starlink, customers are seeking network diversity, which may justify the cost [41][42] Question: Performance of CommBox in a competitive market - The company believes its feature set stands out, especially with the addition of cybersecurity features [46] Question: Cost management alongside VSAT terminal losses - The churn rate has stabilized, and the company is managing costs effectively, with reduced CapEx related to the Agile program [52][53]