KVH Industries(US:KVHI)2023-05-07 01:27Financial Data and Key Metrics Changes - The first quarter revenue was $33.7 million, an increase of $0.5 million from $33.2 million in Q1 2022 [14] - Gross profit margin for Q1 was 37%, down from 38% in the same period last year [14] - Adjusted EBITDA for the quarter was $3.3 million, compared to $1.8 million in the previous year [18] - The net loss from continuing operations was $12,000, compared to a net loss of $4.3 million in Q1 2022 [36] Business Line Data and Key Metrics Changes - Airtime revenue increased to $27 million, up 13% year-over-year [34] - Product revenue for Q1 was $4.9 million, a decrease of $1.6 million or 25% from the previous year, primarily due to a decline in VSAT product sales [16] - Airtime gross margin was 42%, slightly up from 41.2% last year [15] Market Data and Key Metrics Changes - The total subscriber base surpassed 7,000, indicating growth in customer acquisition [34] - The company is seeing a shift where more vessels are transitioning from L-band services to higher-throughput services [51] Company Strategy and Development Direction - The company aims to expand airtime revenue and subscriber base while converting competitor systems to gain market share [6] - A new 5G/LTE auto activation program has been launched to enhance service adoption among TracNet customers [8] - The company is pursuing a hybrid approach by integrating 5G and WiFi capabilities into its TracNet systems to counter new LEO systems entering the market [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving strategic objectives for the year, including expanding value-added services and pursuing new hardware-agnostic approaches [31] - The company anticipates releasing several new products that will create new airtime revenue streams later this year or early 2024 [31] - Management noted that while challenges may arise, they remain optimistic about delivering healthy growth and sustained profitability [31] Other Important Information - The company has a strong balance sheet with a cash balance of $69 million and no debt [5] - Capital expenditures for the quarter were $2.1 million, with operational cash flow being positive by almost $2 million [19] - The company continues to expect full-year revenue between $145 million and $155 million and adjusted EBITDA between $17 million and $23 million [45] Q&A Session Summary Question: When does the new VSAT program start? - The program officially launched as of May 1 [47] Question: Is the H90 terminal orbit-specific? - The H90 terminal is Ku-band only and operates on the standard Flex network [48][49] Question: Will the new NGSO capacity replace the Starlink offering? - The new capacity is anticipated to be offered in tandem with existing services [50] Question: Are more vessels switching from L-band to higher-throughput services? - There is a noted shift where vessels are increasingly converting from L-band solutions to higher-throughput services [51]