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In-flight Wi-Fi provider Gogo posts bigger loss as expenses rise

Published 10/11/2014, 14:11
In-flight Wi-Fi provider Gogo posts bigger loss as expenses rise

(Reuters) - In-flight internet services provider Gogo Inc posted a bigger quarterly loss as it spent more on expanding its services, sending its shares down 7 percent in premarket trading.

Gogo has been spending more on international expansions, connectivity fees and regulatory approvals.

"We... announced airline partnerships with Virgin Atlantic and Vietnam Airlines, signed agreements with Air Canada and AeroMexico," Chief Executive Michael Small said in a statement.

Gogo also said cash capital expenditure rose 21 percent to $29.8 million (18.75 million pounds) in the third quarter ended Sept. 30, as the company spent on building a headquarter for its business aviation unit and bought a test plane.

The company lowered its full-year capital expenditure forecast to $100 million-$120 million from its prior estimate of $105 million-$125 million.

Operating expenses rose 24 percent.

Net loss widened to $24.9 million, or 29 cents per share, from $18.7 million, or 22 cents per share, a year earlier.

Analysts on average had expected a loss of 26 cents per share, according to Thomson Reuters I/B/E/S.

Revenue rose 22 percent to $104 million, above the average analyst estimate of $103.7 million.

Gogo's shares had closed at $16.64 on the Nasdaq on Friday. The stock had lost about one third of their value this year.

(Reporting by Soham Chatterjee in Bangalore; Editing by Maju Samuel)

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