Gogo CEO Expects 'Order-Of-Magnitude Improvements' With 5G Expansion Plans

Gogo Inc GOGO reported a fourth-quarter (Q4) fiscal 2023 revenue decline of 10% year-on-year to $97.8 million, beating the consensus of $96.5 million. 

EPS of broadband connectivity services provider for the business aviation market was $0.11, in line with the consensus.

Service revenue grew 5% Y/Y to $80.9 million. Equipment revenue declined by 45% Y/Y to $16.9 million.

Total ATG aircraft online increased 4% Y/Y to 7,205. The average monthly service revenue per ATG aircraft online (ARPU) was $3,387 versus $3,370 Y/Y. Total AVANCE units online increased by 21% Y/Y to 3,976.

Adjusted EBITDA declined by 24% Y/Y to $35.1 million. 

Chicago-based Gogo held $139 million in cash and equivalents as of Dec. 31, 2023, and generated $26.2 million in operating cash flow.

“The launches of Gogo Galileo and Gogo 5G later this year will provide order-of-magnitude improvements in the network speeds we deliver to customers and significantly increase our global total addressable market,” said CEO Oakleigh Thorne. 

FY24 Outlook: Gogo expects revenue of $410 million – $425 million vs consensus $423.49 million.

Gogo revised its long-term revenue growth target of a CAGR of 15% – 17% from 2023 through 2027 versus the prior target of 15% – 17% from 2022 through 2027. The company expects Gogo Galileo to contribute revenue beginning in 2025.

Price Action: GOGO shares traded lower by 0.69% at $8.70 premarket on the last check Wednesday.

Back in November, “Mad Money” host Jim Cramer called Gogo a “good Covid stock, but it's not anymore.”

“I would cash out,” Cramer said at the time.

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