BROOMFIELD, Colo. - Gogo (NASDAQ:GOGO) Business Aviation (NASDAQ: GOGO) has struck a multi-year agreement with Airshare, a rapidly expanding private aviation operator, to offer an array of inflight connectivity options to Airshare's aircraft management clients. The options include the installation of Gogo AVANCE, Gogo 5G, and Gogo Galileo, Gogo's Low-Earth-Orbit (LEO) broadband satellite service.
According to the agreement, Airshare customers will have the opportunity to enhance their inflight experience with these advanced connectivity solutions. John Owen, president and CEO of Airshare, emphasized the importance of reliable connectivity for private fliers and expressed confidence in Gogo's technology and customer support.
Airshare, known for its holistic suite of private aviation solutions, manages a diverse fleet that is approaching 150 aircraft, including turboprops and ultra long-range jets. The company's Fractional Program offers fractional shares and jet cards, particularly for the Challenger 3500 and Phenom 300 aircraft, both of which are compatible with Gogo's connectivity services.
The partnership builds on a previous relationship between the two companies, with 65 percent of Airshare's Phenom 300 fleet already equipped with Gogo AVANCE. Plans are in place to upgrade the remainder of the fleet within the next 12 months.
Sergio Aguirre, president and chief operating officer of Gogo, highlighted the partnership's commitment to enhancing customer experience across North America with their suite of connectivity services. He noted that AVANCE systems provide a seamless upgrade path to Gogo's newer technologies, including 5G and the LEO service, Gogo Galileo.
Gogo Galileo's LEO service is accessible to aircraft of any size equipped with an AVANCE system and requires just a single fuselage-mounted antenna. The service offers two antenna options, HDX and FDX, catering to different performance needs and aircraft types. The HDX antenna is compact and delivers fast, low latency performance, while the larger FDX antenna provides even greater performance and triple the speed of HDX.
Gogo is recognized as the world's largest provider of broadband connectivity services in the business aviation market, with thousands of business aircraft equipped with its smart cabin systems. As of June 30, 2024, Gogo reported 7,031 business aircraft flying with its broadband ATG systems onboard.
This announcement is based on a press release statement and should be evaluated in the context of the full disclosure, including the cautionary note regarding forward-looking statements, which outlines various risks and uncertainties that could affect the actual performance and results of Gogo's services.
In other recent news, Gogo Inc . has experienced a 1% decrease in total revenue in the second quarter of 2024, amounting to $102.1 million, primarily due to a decline in equipment revenue. However, the company's service revenue saw a 4% increase, reaching a record high of $81.9 million. Despite a 31% decrease in adjusted EBITDA, which amounted to $30.4 million, Gogo Inc. remains optimistic about its future prospects. Gogo has also announced a partnership with Skyservice Business Aviation to secure Supplemental Type Certificates for its Gogo 5G service, aiming to enhance in-flight entertainment and connectivity across North America. The company is set to introduce the Gogo Galileo product in 2025, which is expected to significantly contribute to revenue. Gogo Inc. has updated its 2024 financial guidance, anticipating revenue ranging from $400 million to $410 million. However, the launch of Gogo 5G has been delayed to the second quarter of 2025. These are the most recent developments for Gogo Inc.
InvestingPro Insights
As Gogo Business Aviation (NASDAQ: GOGO) continues to expand its partnerships and enhance its inflight connectivity services, investors and industry observers are closely monitoring the company's financial health and market performance. According to InvestingPro data, Gogo currently boasts a market capitalization of approximately $919.13 million. The company's Price to Earnings (P/E) ratio stands at 13.94, reflecting investor expectations of future earnings potential.
Moreover, Gogo's Price to Book (P/B) multiple, as of the last twelve months leading up to Q2 2024, is 17.67, indicating that the market values the company at a premium compared to its book value. This could be attributed to the market's confidence in Gogo's growth prospects and technological advancements. Despite a slight decline in revenue growth of -3.17% during the same period, Gogo has maintained a robust Gross Profit Margin of 67.02%, underscoring the company's ability to retain a significant portion of its sales as gross profit.
InvestingPro Tips highlight that while net income is expected to drop this year, analysts predict the company will be profitable. This is supported by the fact that Gogo has been profitable over the last twelve months. Additionally, the company's liquid assets exceed its short-term obligations, suggesting a strong liquidity position that can support ongoing operations and investments in new technologies like Gogo Galileo. It's also worth noting that Gogo does not pay a dividend to shareholders, which could imply that the company prefers to reinvest earnings back into the business for further growth.
For those interested in a deeper analysis, there are additional InvestingPro Tips available at https://www.investing.com/pro/GOGO, providing further insights into Gogo's financials and market valuation.
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