Iridium Communications (IRDM) 16 Feb 232022 Q4 Earnings call transcript

Good day, and welcome to the Iridium Communications Fourth Quarter Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions]. is event this note being recorded. Please

now Kenneth Levy, would ahead. like Relations. to to over conference the Vice go turn Please I President Investor of

you, Iridium's welcome call. Thank morning, XXXX quarter earnings to Good David. fourth and

is opportunity me earnings by our Tom on a Iridium's Q&A. you've and available discussion I Joining Matt our release, fourth begin an call CFO, today's trust our Fitzpatrick. call Relations CEO, to on Investor quarter morning's Desch; section will site. of Web Today's which review with this are results the had followed of

I'd Before call to I turn within Private things over forward-looking of contain Reform all to the our Matt, XXXX. that Litigation of the like Securities participants statements meaning caution may Act

and Forward-looking Such statements could to and risks, are in include our forward-looking and expectations, Commission. cause filings statements our Exchange forward-looking expectations fully to statements. results discussed Such are our prospects. plans future the and statements and about that current Securities fact which based with actual historical statements upon are subject beliefs more from are are differ risks not

Our our remarks of or specifically only considered change. today statements forward-looking and such views expectations light point to any the at disclaim today, to elect we update views while may as even obligation our statements if forward-looking some should risks. Any we so of in be represent in future, do

Web non-GAAP for Relations earnings accordance operational as to measures, today's as financial These with section a flow most in GAAP the pro further referring refer explanation yield During generally of financial conversion. accepted are principles. cash Please these certain free including measures. release comparable free flow and measures directly accounting the the reconciliation non-GAAP not well measures of Investor site EBITDA, our be cash call, to we'll free and also forma non-GAAP financial flow, prepared cash to

With me Matt. to let that, over turn things

finished we this of XXXX. all year. better from expected saw service By business as subscriber strong and to out and from measures, to than our equipment another an Good aspect engineering are in morning, Ken. you was morning, everyone. growth Well every forecasting our amazing XXXX in XXXX Thanks, count. release even of revenue grew We year

launched new added and products. new services partners, business number exciting welcomed new We partner a of

We and also customers. new invested better numerous experience deliver people our even opportunities to systems see in the support an we for and

I’m new proud the Iridium to X that year. after million share subscribers we active eclipsed shortly entered

XX more have us. we that. In for fact, XX,XXX This get the almost first in million of It took as years today, us than milestone already to a big was XXXX.

excited we're years, chosen the consumers as to have our So see customers and in network. recent enterprise IoT acceleration particularly

dedicated for this, corporate commitment XXX To mission, its Iridium unwavering to to and values say whom like your relies do would team customers, I thank employees, on you our to vision. almost of

You the to we own that are our heartbeat the of high continue reason outperform this expectations. company, and even

than I we call. larger assume a today's may audience normal that on have

the to So our current on stability growth climate, and some the now of a business give on my I into our business, network, today, priorities and want insight we're remarks with focused. our Iridium’s including provide which perspective opportunities

satellite Iridium providers. unique service is among

well two-way the in and constellation provider move. optimized resilient dedicated in operating and service real-time antennas people delivers on low as things as a orbit, small As Earth L-band reliable for our communications vehicles

and was today. late marvel in launched remains Our XXs, it the an network when it was engineering one

may consumer-focused satellite and our applications to call now impending of over satellite wide-ranging numerous connections. subject media and and wherever connected starting our we've they more the We've the found model. of fantastic a have with ways developed why be and you make Iridium But of years, coverage, drawing planet, the other even technology partners boards. phone always the with increasingly on joined This people why on are this to rollout some morning smartphone single valuable partners’ is messaging

characterized While growth climate the operational is current change environment inflation, plans we interest not will do trajectories. by business Iridium’s rising rates or sustained believe this and

year guiding we're even X% which service revenue XXXX. fact, posted may to of In another growth XXXX, strong we the in in eclipse

posted growth has credit of variety our EBITDA business our customers, in to and growth subscribers the over XX% remarkable revenue, growth diversity through in history, years and the in the Our I applications industries operational of five shown of over conditions as last rates cycles serve. XX% stability alone. our of and stability X% and business a service economic annual we compounded we

so associated often applications. services mobile and is much with Iridium are safety more. But we

global applications for the mission-critical planet air. or the sea enables supports with remote communication most customers on and the constellation Our land, in on regions

the partners. service business global With exclusively contract with U.S. sells Iridium network longstanding the of our government, exception growing a through about XXX of

expertise ride well from that applications satisfy These has new range their network customers. to history. our companies model domain manufacturers developers, and over service all value-added on of leverage products resellers deep and of us the served to needs create whom business their to This our

in continued the Our find surrounds subscribers. as is attract This our ever us that competitor future our enthusiastic and contributes I've that to innovation future partner is a to base fuels new competitive seen, as and their difficult something to deep moat with would network about their market opportunities business integration with replicate.

business fortifies cases partner, application new use stretches network. Each our and of mission-critical the our and service-based industry further model service

in consistent which conditions, recurring revenue, other also the and disasters, they natural of Importantly, even has face events. political disruptions, economic changing durable proven deliver exogenous

grown our we've Iridium, In my XX years partner base. and leading retained

us recall think don't services that's quality our you And it. I indicative of the competitor, uniqueness when the our fact, of about amazing a of pretty I ever which to is think partner and capabilities. independent losing an In

technology have growing partners. We of and healthy distribution a ecosystem

delivering a DNA. our growth, As and to they commitment technology we of new Iridium's while returns ongoing in business corporate Innovation unlock around our and our all for our is communities touch our priorities, to heritage innovation partners, to center shareholders. in efforts business part

history drive them. for new a partners alongside in network, value to ways of connect business have our investing to new products and and which they We will

modules our like our small from turnkey Edge to were and development spurred investment Iridium GO! partners. feedback some range talk of solutions IoT by and the line feedback Most Products which led IoT of shortly. our about recently, sometimes of even new Iridium their exec, I'll

to enters of our powerful thanks symbiotic new in this Iridium Snapdragon space relationship this broad example presence Another With opportunity is Qualcomm partnership with to our Qualcomm's smartphone announcement, satellite new connectivity. processors. to a deliver

that devices. We will platform consumer-oriented a of variety this expect leveraged be across

be available Android Qualcomm technology manufacturers. In will through of premium term, the making this near its smartphone network

will of set used in a laptops, other be devices, broader tablets, a like name this and expect platform to one few. same we vehicles day just consumer However, cars,

we've that should see a this platform more market continued the in the excitement January, by Since product our year, technology. announcement in new come lot Qualcomm XXXX. smartphone OEMs first half and tells in our for to adopt to of hit to us with smartphone early second applications this the of

there's the Snapdragon Android we'll I financial and of the Satellite incremental that know service application a of need mentioned revenue to opportunity, modeling announcements for interest in app messaging. lot in OEMs more from revenues smartphone We've come revenues come additional will our but from wait and new the of from product smartphones Now impact to processors future. new going into providers this

usage this dependent OEMs out. a capability which users, how things depend adopt on Satellite of Snapdragon that and how and will platform many messaging revenues it's actively by price, on we worked understand Exact packaged are all the is being

can't we have limited into visibility we just matters, With today forecast these at time. this the for you that

extend million larger XXX that each produced there of potential as devices. customers it's That's million to will year an future, is Snapdragon believe our demand We year, are current satellite like all even growth their incremental to for Qualcomm. lower in each a of high-end population we which end connectivity plans. And XX to by something hope and processors the well, lot processors

Tom As support profile. be changing next and isn't to years expand discuss, our more our CapEx service, spending but will overall systems the capabilities new materially to this holiday a CapEx few in in bit we'll it

partnerships broadens we also and its in impact and and invest Iridium technology of mindful new footprint, business social our space. As of our environmental are infrastructure, stewardship

in comes that which we we the initiatives and place time the over the employees, support. communities back operate, to in success value we Our our

continue of expression support diversity our and initiatives local tangible supporting that as are education, and partners. ranks, STEM and our thought We with them are value professional and we to to grow employees our impactful

the In for fact, Iridium Institution, lab with trusted we're has others. where their system global employment their become I and of development. Society Geographic National iconic enhances technology fact technology like by hardware Zoo, brands sought National the functionality that as a particularly Iridium the the like Geographic, and like National working organizations exploration out Smithsonian partner

the inaccessible autonomous or oceanic forward reach the extend most to educators be relationships to impact. whether and planet, and of for of it building provide extending and and we systems heritage their conservationists, to our scientists, proud on the fully with on extreme look some allows We're the This support of sites. work these environments cultural exploration

flow of growth. revenue aviation another will double XXXX. we and to to voice, our will return land, believe XXXX, capital growth commercial have cash the another deleveraging. service topics, and my mobile, digit generate in in business ongoing growth seen revenue broadband we delivered of momentum Turning that shareholders support In free in the of in favorite and to IoT be will XXXX incremental maritime, continue and year which IoT,

services new While relevance not and engineering supporting focus, primary have have also service our growing development. in strategic well been

awarded Space further going know, been you becoming in with sizable our a U.S. us will the Agency As well, with Development opportunities our team visible contract that engineering additional largest customer. contract XXXX. That has align very follow-on government with now was

the Transport, out narrowband the technology costs of drive our in for development for which hands module, new being Iridium we're which and It’s Certus our in generation It Iridium and Iridium now to while Iridium roll use partners is will first transmission IMT the terms as we very recently as we will and efficient for new services development Messaging new our of reduce here the it, service of now service completed next IoT growth, in call higher is products well in services XXXX, Certus network In IoT calling resources. our to partners is XXX quarter, terminals. the our available for or in XXXX.

the XXX types. is Wi-Fi and by voice about satellite portable the market out. connectivity and the generate ARPUs data should unique It's from excited generation really check product new I niche and to good other it's our market, Iridium been encourage business. so in ago potential. It's It's product received data connections weeks GO! big tablets of two announcement built Iridium well latest and Certus smartphones and hotspot and product our for to technology, exec, voice on The all really that you a for unique far. our a its I'm

In am optimistic growth closing, Iridium’s very trajectory. about I

we to our attracting While remain to audience lane, broaden L-band moat. support our strong allows our will competitive in ecosystem. our innovation, unique by widening partners technology while continue us reach to our This target to we

as cash flow, Tom free over has year. As describe, have reduced financial our past capital leverage will position grown to the also we shareholders soon our returned successfully improved and

Finally, of I evolution the highlight capital our quarterly should December. always of reflects We've dividend new Iridium’s cycle. program through initiation that capital must be plans. the our a in sustainable dividend long-term said This next program

business program future. reflects flow our to Iridium’s of and cash collective current action strong Board's the free trends, initiate into this assessment generation Our opportunities,

use strategy, this to and as part our and topic, capital to combination stock view of Mid Iridium’s accomplish start I'm a a capital distributions XX% up in good share this. to We to On in were an last shareholders XXXX. we'll repurchasing another continue important Cap Index, to compared dividends XX% in the We with and pleased decline in off we're XXXX. performance of year

which strength recently and in Having performance consistent you have our more of the Investor date Day, secured a when many model, on we business to for meet we're This venue opportunities reflects with our much topics will and the our business share on we of September. new focused. execution these

it that, let Tom? me with to turn Tom. So over

I'd today, our on year like performance XXXX Matt. some morning, perspective recap results quarter. Iridium’s With full the and provide everyone. fourth to Thanks, remarks Good in my for

of also XXXX the for We provide this components additional financial color like guidance on to targets. that key released supporting and expectations our so morning, assumptions I'd walk our the through

us growth. XXXX. added extremely year of As The guidance, EBITDA exceeded delivered our Matt strong revenue noted, nature the business of the in performed continues reflects and notable well of Iridium differentiate and reliability competitors. our operational a growth partners another of to number initial from our and our services which consistency offering, of mission-critical We

subscribers, in growth we revenue double delivered XXXX, In total and digit operational EBITDA.

and XX% forma New XXX strong in line cash year. demand million service supporting during drove growth, wins, recurring the for flow free pro contract equipment all top

strong continue in IoT, business commercial momentum to well voice growth as digit and data. see broadband We with our in double as

operational result, XXXX. a As in EBITDA grew XX%

the comparable period rose prior the quarter In EBITDA operational year's million, from fourth million. from while year's last XX% grew revenue total to to quarter, XXX XX% XXX

our XX% side fourth of ago. from On of million the up in revenue business, service we commercial the was quarter, which year XXX.X a reported

tailwinds. as voice GO! reflecting handsets. from an prior and commercial rose as services the Many trends XX% emerged noticeable period, demand to continued our and data from subscriber of see from We've year Revenue increase the in earlier the for year Iridium have remained incremental count. that strength in well Push-To-Talk

rate several average digit our believe to next data and years. that least mid-single continue business We grow a at for the will voice on at

growth. to IoT IoT, in In over XXX,XXX And up added XXXX, commercial continue we satellite the are ago personal new net fuel period. XX% Subscribers from communications year subscribers.

retail-focused out. provide continue These invest we opportunities for that demand and in with the Our new consumer-oriented with applications. subscribers as this a remain us of will to revenue capabilities partners growth believe and to growing runway tremendous roll new address driver strong midband new sector products

of In access the XXX normal. growth with reported broadband Certus XX.X year the has returned in ships reflects our success and as Iridium having XX% revenue XXX to segment, from we're fourth period. ago the quarter, The to up we million

solution serve vessels Iridium New are for on and a terminals the companion to maritime of as they paired to where continued a smaller larger by terminals, standalone be be sat as activations ships. driven adoption Certus

remained XX% We've XX% year service. from who Revenue other of and XX.X period. representing our at from with existing subscribers, by the grew the year-over-year data fourth Iridium year-end, million XX% also in In benefited legacy IoT from at payload the upgrades steady previously service up used hosted commercial total OpenPort in quarter. all, ago subscribers

at strong growth of and ago as demand was the the This record normal from handset with our the year XX.X contract higher full up million the equipment, in quarter stable our sales. year. was XX% reflects quarter a for of than terms rose in fourth fourth revenue Government Subscriber enjoyed use as increase technology, well the XXX.X year expanding also period, Iridium XXX% the the of partners government. to EMSS ecosystem U.S. in service of has million, benefit reflecting the all which long,

XXXX service we to elements a growth million, Moving are operational forecast in outlook, follows. on The of outlook XX%. range and supporting our to revenue between EBITDA XXX XXX million predicated key this total X% on as of

commercial Momentum of give see consumer IoT benefit voice not from communication forecast up in another do forecasting we traditional subscriber and grow, strength in personal a to IoT. year These demand devices. to in factors let for and in ongoing and base our business industrial continue double confidence us growth XXXX, IoT in expect revenue in service to partner is data. continue We as digit

another for business. our spot Broadband commercial remains bright

continue. growth Iridium hosted steady to to broadened have approximately services maritime, contractual past and our rate contributor and begun Certus their terminals. million. revenue leverage of annual its XX We distribution that in revenue service double will new at digit In XXX Similar will payload expect a remain subscriber years, to partners

XXXX. EMSS the in XXX this reflects Our This XXXX’s demand maintain anticipate and U.S. to for revenue strong We line XXXX allow of until equipment contractual the remain full rate terms with government partner contract, record produce will in business maintain will of us in Iridium million XXXX. sales will year that revenue. which late

highly mid however, for be product will is on percentage in margin mix. This, Our dependent the XXs. expectation equipment

terms service with include to Qualcomm. royalties, agreements Iridium be to will related other The partnership time, our of and these on recently initial majority usage. Briefly Over included vast revenue line. service of fees data the revenue our in we development, that revenues announced expect

relationship. being from of Qualcomm And service the the between devices visibility for limited guidance this our second at until quantity Our expecting does and debut half devices delivered. Qualcomm of XX% material growth contribution a into include we time, revenue have this not is to year. not X%

government's Iridium lines. support is the workload increase expect in Agency this early is to U.S. it and with do the than from rate. again In was to XXXX, the engineering this quarterly associated priorities. long-term XXXX, difficult which last quarter-to-quarter. contract, with Contract new an down and for work U.S. space this And highly work, tends strategic to government us however, while narrow our FDA for awarded run benefit work other related with Development with The that fluctuate accurate the revenue business margin lower to associated Space is from contract revenue year. will to we contract Remember aligns and

factors guidance expenses. number Our a incorporates EBITDA into of

we development spend research expect to the and First, have and considered our initiatives inflation across lines year. and materially business more of development on effects product new this

for the functions. have accounted our hiring we as SG&A Next, in last as months headcount impact well hired XX the over of

not EBITDA, workforce to increase result stock of While retirement XXXX, XX% shares the In again provisions be our stock-based in these effects year lead and grants expense the factors expect a approximately of the of plans. this an in us and up SG&A as we compensation year. a this affecting to issued expect for accounting our larger all, retention performance

This X% experience. and revenue business good cash as well that are will business service estimated mid-to-high growth achieve are cash taxes on to to and XXXX. businesses, in our we for to through between and seeing about We tax quality broad-based our the across up we Finally forecast XXXX. the XX% outlook taxes, digits until important year continue appropriate very believe us maintain at XXXX the momentum rate this our incremental maintain single growth to negligible and an feel have continues and customer expenses grow we services our of sets

Moving our on balance to sheet.

As equivalents of and a of XXXX, million. XX, December cash balance XXX Iridium cash had approximately

operations free ample is than we announced adequate cash balance our dividend and believe flow cash fund our to ongoing program. Our and is share repurchase more our support to generation newly

quarter In of shares the price common stock fourth of XXX,XXX an Iridium approximately retired XXXX, at $XX.XX. average of

full of Iridium an of of This For at us Board X.X our under year for balance total through million million $XX.XX of XXX XXXX. December XXX of repurchase average a purchased million an left with XXX the outstanding for million. the common shares XXXX, authorizations approved price XX,

will deleveraging to maximize objective buyback program, investment. on on desire return continue for with our execute balancing the We our to

As position December capital to Matt support noted, meaningful dividend of initiation a in shareholders, our improving to a returns on quarterly the liquidity quarterly program dividend of including continues Board XXXX. X, initiated Iridium’s $X.XX program strong share confidence XX. opportunities reflects cash initiate Iridium’s dividend declared per in dividend a to and and free on common generation. decision business flow March a of payable The our management's

Turning to CapEx.

million expect this XX XX to in about capital year's of XXXX, related We expenditures of planned XX spare satellites. million including launch million to

XX our will Excluding launch year previously and is had costs, higher XX been a this we expected CapEx than of reasons. million. couple be This for million between

capital reviewing we in that $X about million cost XXXX absorbed we expenditures, increases. concluded our First, inflationary in

in We foreseeable expect to these recur and future. for the XXXX

incur support to in smartphone related will and billing provisioning. business, principally we our costs to Additionally, direct of

higher volumes. product related development efficiency expenditures additional to expect also and We business support in network of

XX XX-year these together, XX to million, annual between in to CapEx of period over from previously. items an capital XX the million and million our forecasted expenditures Taken up estimate result increase holiday average

at the target was our within leverage net This buyback our includes X.Xx with earlier activity. down and XXXX of ongoing year OEBITDA. X.Xx closed a impact from range We

between of the X.Xx continues long-term Our end to and be net for leverage at XXXX. OEBITDA X.Xx target

this share to effect expect program all within buybacks by We dividend our after giving to the authorized be range, Board. even target and

about of expense million through we prepayment some terms the billion in this the will reduced to to recent approximately in interest current XX I quarter, XXXX related rates. activity the at our agreement. loan. gross In X.X permitted savings term balance result debt to to and also outstanding and loan prepay million This as in principal XXX Iridium’s highlight want elected the fourth term under of

about entered loan. believe an repayment environment. in We addition Iridium You interest rate into recall weather will cap two current positions to the term in interest thirds to which well the hedges that of principal us transaction rate this also our XXXX, activity

forma XXXX Turning million free we guidance debt interest EBITDA for year, structure, in to free working flow. in inclusive our current of If XX almost pro XX approximately capital, conversion CapEx and adjustment, hosted of our appropriate XX and XXX the midpoint for flow our a payload free These X%. and a use approximately forma in forma off rate back million. million XXXX, cash of this of net in pro cash of of cash yield the we're to flow EBITDA represent pro XX% metrics million projecting

description Events detailed available A supplemental along Investor tireless in employees. Iridium more Web metrics flow year of the Relations reconciliation of is these this has strong very a that closing, and on In cash proud our GAAP with the presentation site. our commitment execution of to measures I'm the under shown

to to while drive for revenues returning continue subscriber company. shareholders. model remain will our still our our We expand capital and partner base, the new This growth,

that, the operator I'd turn Q&A. for like the to to over the call With

We begin [Operator question-and-answer will now Instructions]. session. the

comes Please Our first James. go ahead. from Prentiss question with Raymond Ric

Good everyone. Thanks. morning,

Hi, Ric.

-- the to how you further want the but out understand give appreciate different can't about any lot I be for guidance us, Hi. on on a hear on the should so to I on that modeling in we that. Obviously know real guidance. to material come us a that categories. laid yet, Qualcomm color I bit little thinking not you've nice the more

there'll way You support royalty where to or services usage like be services? then ask go revenues, And engineering to or or that does the question some mentioned booked get of does into on assume services, is contract. booked? the earlier the Is engineering that get going that that development, revenues, and in there's that I comes Maybe some revenues. service and in the into development

revenues. into into engineering -- the royalty Right. and go support. The go into and service all development will rest the goes will And

revenues pretty margins, margins it. healthy side. rough and put the But would And royalty I know development on assume the I can't Okay. on we

that's I think accurate.

Okay. provision And margins? systems CapEx that but and business also services maybe comes the develop then the your to business, on kind of services got earlier above items, other in, be we've service obviously existing at and and should

say line, would in Ric. I

okay. line, In

said we Okay, got when think about the helpful. ready the longer-term date that's as should give a Matt, Investor you you've to far you us Are And put day. calendars? on we guidance, as think to I Day as the something the

I XXst. here. Yes. don't for yes, I'm know you comes guess that. just is is September time when I'm I Ken to here. September allowed it's -- perform know ready not up writing me and it for show But the the to date. XXst

industrial Perfect. partners, out major been an that the on IoT. IoT excited that Deere how contracts the IoT about of Maybe about more on -- maybe but are side? of of some update at And there. some know hearing as update think OEM should some OEM far you're industrial personal I and others the very and [ph], the side an segment But we maybe looking we've particularly as communications.

I very it's for number plans. those active they're been a very Well, It's their of now. I've visiting overall a of broad-based. in robust quite sector us partners, terms still and right think

-- some the is not case, You lot. kind But and new heavy put even to it think maybe busy it's too. very a to every very of that perform partners continues to really that continue a new just early which continues sectors sort for specific to keep even of in it's robust -- of speeds. quite which data be utilizing stages efficient on capability, to will very hard very, ARPU But it's We previous that today, mentioned like more higher overall the to think, be IMT, drive the segments the Things at deliver sort adding ARPUs still well new good we're more really front. our really segments. IoT might and in adding it. so more that, which sector mentioned of on applications equipment characterize be will and and I applications making an fact more customer. higher is to mix. that the sort I market We're it’s We're broad-based, It's attracting and sector of it's moving of

some And very Qualcomm platform. one about on Are Gen X, guys of the we with premium X trying or lot people what have to that Snapdragon to obviously, there to trying different Gen sells about don't I these produce how component Satellite the to one just easy how the Android questions fits obviously Snapdragon -- Xs arrangement that of Qualcomm satellite to just Qualcomm what they understand flow? but just you've follow talks talked understand Qualcomm is that product a chips the get got Snapdragon don't but answer into directly, X it, you their

one platform. It, just get example, phone phone, Series suggesting understand I'm highest not hope. But other. and the too there have too was one the their does the powerful get it into Galaxy or It But phone. premium it for a same manufacturers that I assume functionality. that probably late pick the processor satellite will can that And version be of or would to in to time. did phone, So will was as for I capability Hope have But here. X it, it. in late I I way it, correct phone. them that it. know believe will other, use of if the of will don't they I don't to choose then but I I And believe you it X into said, just versions went if like new probably that over most I'm XX that not future satellite they the have The capability think it into Snapdragon, is as most do, they it have want to.

I the in I somewhat are in assume there as is powerful maybe chips same less costs operate their platform. that hope, said, lower portfolio and developmental other of kind would Our

possibly really to as over satellite even market of port hard that's our even cost a moves, you just over will, it those it if love time XX I our that a and even down not capability big lower those into get in it's into said, about into So portion XXX And higher million to upfront. stays But those well. if phones is as time. million that year to devices, hope

a for people So for range into And automotive of could other products, have as they as ported we perhaps are thinking about other that now. do think I we be understand well. and applications those

very that's Stay Thanks, guys. well. helpful. Great,

Okay. Ric. Take care,

You too, Ric.

from Landon Our Morgan next comes question with Stanley. go ahead. Please Park

Hi. Good the questions. morning. taking for Thanks

just payments going and the royalty Just provide priced? the you Are disclose are or that, on what able the to anything front? to follow-up it's like anything of sense variable fees be one you're usage how would there Is to economics Qualcomm. unit on that on look any to if able you expect even like, that

Not this But it. to desire this at do early really I Landon. time, just that. too understand at the it's for time,

upon right revenues the I announcing start eventually out and it we putting based think to infer is be over now you'll people revenues start disclosing. think units able But that appropriate. time not the and I that there all

is does Qualcomm on negotiate or that up between guess understood. payment structure to how that all OEMs to I you Qualcomm, work? with relationship the a Okay, it them And essentially and the smartphone between

decide they as both those and announced business turn We applications fixed. that's well the manufacturers Qualcomm. with model then fixed that is relationships how on last smartphone But to deal our and into year, providers. Yes, as for application go

understood. Great,

you change. growth to perspective? up I that to views the data, your confidence to within power it's outlook. think the pricing on of segments. from you significant of digit So that some other On segment? mid-single the last on helpful Are about your anniversary Where voice talk moving five-year your hear guys are on about coming in pricing at and you're able

good the market. competitively has that raise pricing. places we still and in have can some a believe I happened But in yes, on Well, prices. we good And a think in positioned time. there that well over cases still position in we place feel We're

access we strong this year. think Yes, be will very

you I’m sorry, that, Tom? what by do mean

usage, in see and Between access strength access. you'll

thoughts that new sort on the there's and latest IoT an last talked any potential whether new by see. IoT trying had And or introduce And announcement of within competitive the IoT? year. IoT on constellation. maybe, been you a that been about I M&A Understood. about the How on you not about thinking Matt, are side, to quarter has two-way updates this there's device front? Globalstar talked your EchoStar about landscape

believe Yes, segment do. a for that market what I that with I update continue don't is we synergistic you. have an to

I or develop will long narrowband relatively are you time general -- small think in most that while be including because take they of lower to described real in next would or be satellites in and to it's sort call what two-way, the they some real-time time networks, there's, take not to All to services. just a the overlap. people really launch coverage cases, two, there, are the going going end IoT to not really anything to are I time, one segments provide can some year and permanent going not develop

I We want to, what end, look but in to capability volume even participate to we're but in So very low to to I that. want the we I many network so broadly well. to necessarily for devalue lower call way don't we we're that have some ARPUs business and years as partners right going because and more then very want them to think very our current in kind many IoT has likely now serve remain do in call going broad And strongly of would has would positioned what premium important this segment.

sector. the So for we be we them of see of could of we're low in looking breakout going outlay achieve them well going that to a so you like investing continue EchoStar. the in bit think interested. we're extremely you're own helping active. someone and and We're to become to is consider EchoStar in end us see to like not very I a all big what network capital have our we put stay best But do, build that We're think a with and to us us interested situation talking we'll very in them don't do to do more positioned and competitive that. provider, But may that.

for the question. Thanks Understand. taking

Thanks.

Piecyk go ahead. Walter with comes question next LightShed. Our from Please

at other Matt. their with chips? it design the manufacturers Is looking if own device Thanks. conversations exclusive? that Hi, new not, spurred I’m on release. perhaps And the has relationship Qualcomm with

the and anyway, lots people It and anyway to through there lot couple important platform working exclusive emails I off of getting areas. really here. new the take phones believe I'm up the a a ringing from really around that. And of it discussions. participate or leader the Well, have market is hook, but looking go to idea we're and of the into certainly picked because years has next we for strong smartphones opened we ride

get going every that I as to to and We that's be we other that's broadened in opportunities obviously want only on think devices right be feel now. -- But positive future is think it's name to going mean and be platform now. Qualcomm to industry exploring well in as really we're like smartphones the won’t That what going wouldn't not doesn’t for have say potentially I it's I really we the our road. into trying to well. down the device consumer right into we do,

cars like everything. Understood, and

look at some revenue future in you're well? that not, you over also capture I when emergency for release an your be these if that that call text messages. incremental that understand opportunities, might invest with? the implies might it of responsible in is some But theoretically time, emergency be messaging. integrating center obviously and part So Is want there that And receiving to should revenue something that messaging. somewhere all that's messaging maybe that area as you of a references

No.

rapidly call center which arrangement their it We the They ourselves. and they're They involved selected a announcement the of them there. have So in big been the kind have do their center think of great business announcement in of doing you I part is announcement. work. might already they at And that expanding to that a appears get market was the that. have to Qualcomm has that sort Garmin recall want call products, that in of lot for wouldn't

think different it's operator, a great do and I job satellite they a think business than a completely being I of it.

roadmap, that When a a be the do to me someone I me in when is from a going of want just part beer stuck revenue you to think to bring service? as to text canyon save messaging -- actual being opposed on the somewhere,

good a be to Walt. I customer, look forward going to You're that.

be I no There's great in County. a customer. think I’d coverage Westchester

Yes.

of relationships that activity Qualcomm there's is to going. discuss as and that that. kind We'll tells -- know has us those So around continue activity I sort how of

think learning and going be more. I we're to more

packaging year. half thing, on. that software be which and it. all as go stuff could sure have there's of know clearly I think pricing concurrent all coming. more has but It the this I'm be it's kind to in in the really I It's and there'll but don't development most coming the it. will second But come XXXX announcements a describe part, It for for and a that forecast might of early I of as months,

just questions on start the some then Tom. this And some Obviously audience broader Okay. the of have now. program, for we dividend might call with

should thinking a a And in or for you're give dividend, thinking rate either the your is in of target about then there where be those minimum in for about So also should how growth, of terms expect dividend? they the of you us interest income given range you're at land, leverage, the moment? growth sense can a any the what difference leverage regular environment, in that on

X.Xx. the construction through put intend the to leverage growth And stay. it No. not and way dividend, sustain to but on obviously appropriate that's the all target that the our next Board I'd X.Xx between it also We cycle initiated time. when like reiterate over to of to only area expected we they where

don't anything, And to that but any like investor expect? a what sense maybe be? growth of should an income get giving held Obviously, are you you down could want minimum that

it expect to Not time. at this time, Walt. We just over grow said we would

Thank it. you. Got

Walt. Thanks,

Please with comes Mathieu Our ahead. next from Barclays. question go Robilliard

you morning three for Good thank I the had presentation. please. and questions, Hi.

first now new on the I can equipment you're and that? was which the is volatile. that And of think sound [ph] The 'XX. the to line in continue revenues, a grow 'XX one past, sound the a surprise beyond kind in it even on bit out upside, Is Because it side, equipment with calling normal? more

So the that's question. first

really don't how know Certainly, really equipment. pleased on much be we're I term growth see long where to exactly has there we'll been.

of each on to for work overall partners surprising been and our us has as I you're all had because partners opportunities. we year success upside. with that's seen few challenging, really We And through, last of the our years issues really supply we're just and how more positioned, had think were and the competitively network lots the right. -- really and a chain our asking result a more

with like now. of to we're It pretty to going do a years. not two still for line kind comfortable right that. So it's like be able been year we're be in 'XX going feels back which we into also inventories, But to big building have the being going last

we're So to it's working will kind another that thing be But that. of that go beyond early.

this either. where kind given to not point, a that be in we're will that. longer-term ready too backwards We're much just hard It have we'll of given all 'XX. 'XX. not visibility to guidance into opportunities, be It's good at go we'll on hard say We but believe pretty exactly the for

Super clear.

was put or complementary to you maybe capacity whether quite this in if generate could a before constellation, but service higher years comment opportunity one made could of that's maxed terms capacity lead that that something whether of a in launch wondering revenues terms the I network. your what with X to a of was can is actually the that your things ago second you But even capacity few Qualcomm utilization of do? how efficiently of the you The use position in fleet. On fleet think of I change the you where kind of you billion the next out and

down it extremely a It's at Yes, of we've where kind addressing that how other a on like only comes consumer it on will capacity, few network would course, typically sending the in I we've a we I specialty but of for describe efficient less specific road. end coming even capacity. And that future this ways very But of and years built messaging. the our and broadband would capacity broadly. still that and lower it's doing messages pretty little points it smartphone call at see in But of But the been kind least as successful what question terms found a efficiently broadband And is. we very in good will a around, hotspots point areas. of Capacity be network specifically, lately. it looks too really places. modeled products, in so in distributes it's in is way our itself the our those depend lot maybe there in was at

in our when So we'll build CapEx to of need affect way any for cycles, view right now, our network future anything a or it do holidays, growing expectations our and capital really see that our with really support we're that. We that network we years like the able manage traffic that to the the still kind have. seeing coming we're of in doesn't

utilization potentially my push for here here, the luck never a you've points past But because given I'll this capacity mention really the more capacity do Thanks. you in utilization. few application.

share you can now? you don't I So of if know where are range a

exactly and that geostationary is, a have is earth day of it's When different earth satellite and whether satellite individual and for XXx the fully. third half basically -- you capacity earth, challenge from each can traffic goes a of over satellites -- tell of thirds, high have fully capacity The what what to satellite can obviously more Earth you moving satellite two utilized you fills. parts getting fill and low tell the you or being is widely a the distributed they just is positioned they're orbiting utilized the where and each being across around a

places in most certain terms utilization, areas have there considerable around look lot we capacity much even on left as -- spots over we we of most specific How over on is left. areas Earth. the are capacity we There land well. the have higher sort the where Earth, don't the capacity a ground? those for getting there, that earth? have place still some fill typically have of is But in in we part we capacity what And of So on of a a are more

based like a you XX% hard to or So I XX% give upon anything or it's on it's where the describe can't really are at because or that, earth. we're number because like it, you really at XX%

the depending you're broadband certainly of And so traffic never that's that most the capacity utilization plenty who for today cases. are, of us. our traffic see available And in we you in oceans where or lot most and you have like if where on capacity a is might places got

is satisfactory of I change a and all that's We have it'll us I a we're completely not think don't describe a So in of know for capacity think frankly, good runway future answer, can it's -- but we CapEx ahead we're right And sort subject. plan. of good complex our now. shape the

at to initiatives Thank the another your same as Also competition with saw by your clear. the business? your not parts realize ITM, last et cetera, that I same IoT there text? Starlink, And this was we've seen you. partners. some one looking of bring a IoT that you wondering Very it out different Globalstar, some cannibalization their characteristics, just communicate device-to-device which of some obviously other threat if may maybe the the own can potential doesn't opportunity but from angle, replace that exactly to products I of if users, not And of initiative, be could more smartphones products? is

us heard -- the in for it, has because Thanks not past, asking we've while addressed everybody we've it that. address

grow. specific in will do a growing be partners of the been continue our are that that going and because of to where really that market application, for consumer that segments so particularly focused they market to are will much our segments is us expand people they It consumer to that, addressed. feel lot won't on network those have be kind the market is And way are fast continue that be the whether addressed, part. going have so on like belief segments Our to we believe that smartphone And market telling the the that.

That again, use purpose affected thing. just isn't on underwater sort all. certainly status kind more pipeline really heavy it industrial. or engine going and affect product. you're help business, an on or of going to I the from really would a good equipment not of I segment. an on partners about buoy it's to think expect their the or transportation of popular versus that But or on be on going our segment what so consumer going don't any, IoT supply I to or a built are affect smartphone very a ocean would of to If sort It's glider of solutions piece at gas an our buoy not feel it our So of call oil on that fishing casual a sort say

Thank you very much.

Blair. Louie next Our ahead. go DiPalma question comes with William from Please

like it Matt, you and years congrats making. the Tom, was good to seems Ken, many in and on morning and closing the partnership. Qualcomm It

It was. Thanks, Louie.

January be answer you possible a pieces recreational did and in First, say service I’m it's touched XXXX have I the messaging. earlier? emergency perhaps that as sure you in it think Walt's related read that question. to this clarification on available I either messaging to many recreational your upon announcement or media And But even in to X. for discussed recreational question. messaging was it the on call And both messaging the it announcement,

I use the Qualcomm kind part piece, one of and announcements be that available is available obviously on approve, go one you'll It's by other. But there platform. we will it. wants could as provider way needs platform. what the Satellite the I that an Snapdragon and capability application The in the that will a It be just It no into work in I'm messaging the need to in really app just said into provider exists that's focused say, be that hearing that yes. exploited possible, 'XX. this, all the We suggesting on that operation. they're are utilize emergency think other messaging and be to to has to Qualcomm January platform or announcement to second know of matter more be applications other for or day It's I future in that for half because pieces what. working the as baked not the

question, on balk smartphone upon adopting know this a adopt any service, smartphone words, would emergency And somewhat messaging of the Great. do In service? of think topic to charged is subjective for OEM you the that now would I Qualcomm? that that OEMs other expensive but the it be think will by service price based emergency do you at be the

I and a interest that. a some I that that have sort testing time have of know I are hard who answering analyzing of to OEMs and can there's lot visibility thing.

was know I I report emergency it's -- that of its I anything terms if don't on I'm knows with So things. about what there's how in around messaging. these manufacturers very it. or activity can works feel concerns smartphone that Qualcomm around and sure surprised about that. I'd confident there discussions certainly be pricing doing that know it

streams rate your that royalty revenue high just know will data qualitative fees, data determined larger also any very bucket has along not by the know that or is bucket of the lines, revenue? commentary you partner on relative that would question potential Any what appreciated because be the but do not could another to Thanks. of may is royalty but on able the there usage And of be any the and much Tom, this streams royalty investors. provide revenue you that to you size And commentary by of the for the as so? than be there Great. it level seems be can commentary type what stream one you versus be potential is, provide And answer you these should other? bucket

service the you the said and usage over to be commentary, Louie, which to time. expect would what we listened majority we've fees my Yes, if revenues, be in of service over vast is, time, revenue initial

be we be engineering support. So and development more that than to expect will in which royalty, in

barriers the is layered onto Thanks, service mostly what being the to Great. hardware it there Android Tier last Is Snapdragon Tom. one, software? on available one or chip, involved expensive the And X phones? are that's Satellite

support that costs the anything of, don't in to adopting phone of a a much think any power to very is or way in mid tier don't have slightly that's really a that I going higher go this. economics amplifier to this. lot change say, like additional I think there's

down. to So think barriers to are I don't entry many there move

it I think in manufacturers in. it, think value they putting whether want that OEM it will there's be whether incremental any

with even but example, kind Apple I the in of is phones, will the doing. higher how in come other I'm think service success rooting that just that Apple the not success end phones, for to demonstrate of platform for think to connectivity successful, it I ecosystem the create more value service for the this to because more to demand of create masses. will be the very satellite around everybody opportunity across

it's think out. I time. So a just matter how We'll that works see of

Matt, Tom, Ken. Thanks, Great. and

Thanks, Louie. Take care.

Our from Hamed next question BWS ahead. comes Please Financial. with Khorsand go

morning. Good Hi.

growth I want that ask the that just seeing in base? line. customer an So or from or to having indication of ramp partners existing demand last just experienced Is is that you the year, equipment about refresh is that a equipment

be to the more has it across our Obviously, board. demand. base Well, increasing we're

have support inventories have be growth demand had. wanted and There would We're devices been refreshing base. the year, every handsets previous those areas. in demand. challenges terminals, getting they of [ph] GOs strong not to are and devices the more bit of across not the all little a could are been that catch or that bit almost refreshing depleted broadband in so from there this could has little and they obviously that see getting good But area year up There there chain this little board that I because a IoT So at demand. seen a there we not And continues growth been supply growth of we've all still level. as of I from demand in of just that high too. say challenges, bit said, the and just there certainly

a will see across we're for So demand itself our But higher I the I demonstration thing that it that think that's kind the would certainly services kind of watching But of work closely. out. just we the expect of board. is

continuation revenue? result availability a Obviously, In would lower equipment in XXX the up? it your kind on impact will a what by have this going price that to partners, Certus service be that your of And of of line greater service. revenue would

focus area so into XXX for specifically primary be right Certus terminal, the now put XXX. maritime lower a cost Well, Certus and can is

there looking lower. continue it even So sort into to lower capability. are solution. price that's will in and segment it But a it's, a for broadens it I even of growth a to backup people companion range seeing types didn't terminal of go more make can ViaSat they for sensitive sort at think can the a that make ship of products to determine, also go application kind It if expands a maybe growth sort the weren't who see will It we're expectations. -- really of cost of are support of lower that example, it to provider owner that want and volume. in just We even potential could more XXX our all lower think broadband broadband just the to going partners costs. in because really

you. Thank Okay.

Quilty Please Quilty Analytics. from comes question next with Our Chris ahead. go

questions. guys. quick Good stuff. Two Thanks,

data year. the rate Push-to-Talk. next beginning of couple we've really pick guess this where evolving But like from business? are First, traditional the are guess you growth GO! kind to over of on sort the this business, the ago, where XXX% and new services primary just that see I we the years? mix was I couple do up and the transition last which where in years of a congrats, seen there handset that contributor product voice And

the as lot year. handset we've of surprisingly, business Well, core growth last gotten in in well a

as and more further our perhaps struggled and has because handsets in been were think sort still almost bit have, little have the And that it which more it ahead I on the on -- than of competitors focused we been As market than to diversified be has manage better. you know, confidence more can we segment, a seems for perhaps Iridium before. ever

GO! the that’s continuing things GO! exec, focus quite demand and And be and of a sell good for about for and a -- driver to has driven good going for, which I services. certainly so it's data portfolio driven been of driver. have We're this And we're it's At bit think a to popular same been with broaden because GO! more us. will there and surprise, voice it's excited a growth a some and business be not a -- our there. we've time,

sticky As has too, you to in is kind that broad-based a and very the and service market own year be really Push-to-Talk said, its really last of unique come continues or important. into and

by who that provide, the responders, change for the they road, dramatically anytime a just satellite to or the at move could down thing I but that's all affected people But even and going for first it. devices, soon. So built away backup I basic suppose in still purpose or don't that going see to we're think I be And time. anything phones smartphones -- from say least the completely way, wouldn't long another that services the satellite need to it's the say added with changed is again we that mix coming completely by year

to it's area be too. So going for us I continue going product to good a forward think

the up there And helps any chance that products new of ARPU? is pull mix the

as and to an it a that lot there had into exec I services. a low moving air area to a data it capability up $XX,XXX rate put and really of as even using do And was it sort good connection higher send email ideally the of airplane. airplane could not now Well, for and especially yesterday $X,XXX. and if as get fluidly you really WhatsApp pictures can can put or and too the way. a you a could airplane, in in in send you that big for and could, typically to up Definitely, cost in adds They're to a don't can't is a Starlink but your connection GO! an same you work sort $XXX,XXX small boat terminal speed you of get to connectivity kind of on our since do on minimum that. owner basic small XX,XXX a aircraft the whatnot,

using that's it, think of but So satellite a things. a you what as could even a you whatnot not in and GO! and -- phone just device. those messages as you emails lot send I do And can't before with or help start soon basic

think but I yes, it the certainly the around because we're going on edges ARPU to So large, it's quite potentially front. help anyway, could

send you a If can TikTok, floating directly to Chinese that post you balloons?

I stay to away got think. I from TikTok

Matt. suggestion, Thanks, guys. Good

I conference session. to for any remarks. question-and-answer like to closing management would our concludes back the turn This over

into really excited thanks the us. about Well, joining for we're I'm momentum XXXX. carrying

prepare of longer our imagine, by sector this about to more know for our continues now lot Investor especially and business, is we'll a smartphone a I describe even evolve. as I share we September. You think to to think have in term September We'll Day what kind would vision

of and thanks So look for being call. forward to to continuing care. on talking the all Take you

The you conference attending is now for concluded. presentation. today's Thank

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