Iridium Communications (IRDM) 20 Apr 232023 Q1 Earnings call transcript

Good day, and welcome to the Iridium Communications' First Quarter 2023 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded.I would now like to turn the conference over to Ken Levy, Vice President, Investor Relations. Please go ahead.

Thanks, Betsy. Good morning, and welcome to Iridium's First Quarter 2023 Earnings Call.

quarter morning CFO, are begin Tom discussion our this Desch; CEO, with on Q&A. of our by and Fitzpatrick.Today's first me to our call Matt a Joining followed results call will within I contain trust review earnings website.Before meaning Relations Reform which all the release, like I Investor that opportunity forward-looking turn available call the to of participants this to Private Matt, on I'd morning's the is section Securities had of you've Act the statements to Iridium's may things our of over caution Litigation XXXX.

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

be be me non-GAAP things the measures.With financial financial our these principles. not today's free most over measures to of update forward-looking to of flow, some website expectations accounting considered we cash to release today elect Our reconciliation as the remarks and for turn the to are may cash point in Matt. the flow let conversion. and further so even only or Any yield measures to we call, today such non-GAAP specifically of GAAP forward-looking statements do Investor directly free including in that, our earnings non-GAAP These comparable views we'll cash in pro disclaim forma obligation of generally if Relations financial refer certain future, and free represent any views section light referring accordance explanation should also while our statements measures, EBITDA, and risks. at prepared to Please change.During operational accepted with flow

everyone. morning, Ken. Thanks, Good

a as engineering few to subscribers, second-generation our We're meaningful we're the you advantage all been free last our full on all this service to forma for experience hitting really as cash take and in of that's see, great value generate momentum years growth continuing user continues XXXX. as flow we revenues, start Since the As remain partners off can network. of strong, services in pro over to all our in ecosystem. equipment and we're in cylinders, well building

industry, for see to new of ability Iridium distinction call and satellite these orbit is us an out connect established small operators directly made months a in events, it's me of connectivity direct All penetration satellite low getting and hear assets kinds industry of the partners. reinforces a with sales networks aviation segments.It profile for decades. is last important and on services, partnerships what particularly this front, another and has happy acknowledge year in the since all travel natural growth personal smartphones, of to increased maritime, and for also earth our known that conferences, again many operate to the governments particularly increased for utility. key the our and are global interact satellite conversations few at the mobile services topics busy for a proliferative to satisfying advantages subscribers.On It's of shaping expectations and as and to ascendancy conferences, industry strong and been we of Iridium's existing satellite other There of with so are LEO and for middle to race like investor

likely X not this over is last the or years, story who For those have revelation. followed a Iridium's X

a which satellite great been our fit unique emerging focused are very focused leverage network. operations constellation opportunities is IoT And that the Iridium's applications strength. have on with architecture on and We now commercial and sector

In new has most. devices market, the are, use been to for.A lot built Iridium and on device network personal industry focus the fact, wherever connect was through they this the direct way the of what they to continues people is our to lead

a GO! users are Iridium are hotspot provide quarter in introduced first connection faster XX% a on outdoor government the when than remote navigate Iridium today, line in recent continue customer our in excited their That incorporating Qualcomm personal Snapdragon will We've connect to Iridium example, of messaging of has devices first The growth for grow since utility being our as emergency some services the low also booked allowing data but Iridium generation the Iridium our about secure for will For next coming response consumer-oriented environments.First satellite a via Success already is line their A that number data And working XXXX. and commercial we're we drive partners satellite processor represents capabilities services to Iridium, and even segment the Snapdragon include device revenue announced Certus users application the receive it expect into growing our and Iridium with are this have upside in confirmed safety technologies SOS relatively Technologies this with location, segments devices lightweight to supporting IoT potential chip our adopt basis significantly number Android to compound we richer to and than add seeing new more Iridium great line IoT more growth on by term growth OEMs a satellite X,XXX introduction in directed list.We're partnership this which they And later will exec on XXXX.ARPUs to data indisputable. share smartphone on introduced SOS. of here small our reception our have is workers, year.We're years, about and send we We by satellite for had phones. and years. the business GO! Iridium additional all, become technology. with of over organizations opportunity devices in highly annual growing demand ARPUs higher excited satellite allow our consumer-oriented providing mobile of announced network XXXX beyond. the network, half These X/X on expected meaningful in devices of a million and and value users network. market integrate to This this smartphones with underscores expand satellite of Qualcomm of X-way smartphones. our new a enthusiast, and Iridium's longer orders growth services. quarter ruggedized device also ARPUs in that projections new these to global in that create. further strong business expands voice interest, already. direct-to-device from the our to expect mainstay GO! for well remote should in a texts higher and communicators move drive dozen services believe from of to These to routes, tablets and the drive the for to as

growing in government business our for industry also in core it's of I as convergence well, to all, areas but as are forecasting even traditional service land connections devices We is opportunities. business broadband, today.In sector. partner world. sector see cellular the platform an growth satellite for material strong had benefit convergence between terrestrial example satellites this best relevant more like interest and and of and other But within the to aviation automotive the our and a today with applications satellite and not appears the believe think future. well but on already mobile, many a ideal deployed opportunity unique opportunities from lot endless.We eventually are like we mainstream industrial our additional the be constellation driver We Satellite expect a as to is this applications opportunities IoT, maritime revenue technology and we're incremental in And consumer direct-to-device of computers the IoT strategic we'll convergence growth, Iridium's an continue going tablets. seen of where see demand of this expect be strong to solutions in is for of other

of in our first quarter performance. see this proof can You

We most while starting are expectations. feedback has Starlink that aren't channel in maritime XX% broadband right grew the in this maritime revenue where Starlink receiving little is when product, future. their in customers.While traditional about us are that to share year-over-year VSAT margins disrupting on interesting, market. deploy our to our market optimistic positive space, requested and the keeps this much by making the now partners trend take And the from effect continue first our hearing quarter We're they

all for also on vessels, wing as and SOLAS that feel some Iridium kinds maritime. on world, deploying Iridium are installed the X of in of As solutions, as very Iridium service the kind GMDSS that applications their fixed sea calculate on in about X is out with both Starlink also we're well around crude about aviation requirements opportunities estimate ships diverse of of terminal are other fishing and is rotorcraft. and a the installed VSAT at We seeing growing.We is some partners vessels for this in and solutions monitoring that course, class in with now these market, still solutions safety other number XXX,XXX and as Citadel kind today solution good companion of an deploying and antipiracy vessel

the I We've with and general of all on also along aircraft, expansion to XXXX safety and see strong In type count larger services. take transition broadband the terminals it already and highlight additional well aviation beyond.Of as And partners specific portable other see can market, speeds solution they Certus certificates as deploy mid-band tailwind been services helicopters safety data to been certified.We're aviation to to as a IoT their time XXXX including and a onto land for that first nearly these look a types. have commercial, or where Iridium aviation or for approves waiting aircraft as the FAA of into we're course, traditional build pilots new our them expect partners' who in aircraft other our installed starting all are expecting for Certus aircraft. long land. And provide kind to the systems mobile first take revenues, that from to well to XX,XXX on should us for business start want which antennas forward for antenna narrowband voice, doesn't from today, as this progress the We supplemental X the Iridium our performance. now types certifications aircraft of faster also when

our voice good on our high shortages actions pricing continued believe average competitors. after GO! year-over-year to see handset for the and the several airtime equipment can the well was by and for years.Overall, strong. of and lines business service business is the from demand access for years. ARPU our and Subscriber as services holding and We for of continue Ukrainian to and continues They're about business Push-to-Talk stable unusual environment robust, an still targeted the Iridium now You experienced trends implemented single-digit we year pricing be up demand least which we the growth generate exec was at will quite the durability not the for strong. feel conflict experienced our as all primary growth as XXXX, next at growth demand level remain help the few incremental of some with

handsets us, As you into the remaining we by fulfillment our on XXXX. supply still can allowing above midyear, issues see mostly another for abating issues delivery inventory back to initial logged affecting have very the Agency experienced growing by network. trend. revenues own beyond our components their with from and We quarter levels.You'll award devices orders our that note ground chain feedback handheld have for Based partners, sales a intervals, them work supply record the effort us Development work. building going but strategic next-generation to and on traditional in of our and on engineering equipment new chain expanding are continued competitors XXXX it's we see, our we're service up substantially for That's even for of well, the the Space also into build doing

first a our corporate we revenues, on highlight to our our business moving governance for without quarter. said to our government dividend. Together, on in business believe you've and other culture. along it enterprise that to share payment in to our first would generate in way program, confidence report, forward had ever customers, business demonstrates what In we've we smart provide have strength is our which cash the programs in chance margins and compared the additional area believe on We environmental, ESG first being further shareholder-friendly our performance results, to speak low priorities milestone capabilities.Tom our dividend for it, this I XXth real free the steward also shareholders and with addition important our is we which and on to enhancement our our corporate in like commercial an a ESG the activity sacrificing repurchase acknowledge quarter the these paying March. commitment a for and good very important to ongoing underscore made is review active values hope to service before, March As I published and will is flow.I social with our of returns was latest call historical to relationships this will would opportunities. business I matters but of our work the on color or generate

some and our been fact, enhances that demonstrate business more to the operate ecosystem welcomed position align investors around hope disclosures, partner we year's in by appreciate and their allow better notice the new employees interest.You'll as hires social support with impact. report has priorities values In in with this for detail to with stewardship we our which enhancements our will and we our and our priorities our which factors communities

in launched of celebrate this we Iridium's service as the anniversary initial XXXX. XXth year So, year,

that positioned XXXX in believe the for shareholders. to other our for industry better satellite ability Tom? fund evolving history, of I'll be review over opportunities another exciting that, growth progress.With a and our of will forward time to Tom any in with it financials. new you more at Iridium both continue We is the abreast product and to than us look rollouts to reward announcements. our year keeping great and our with turn for I

Matt. in we revenue to our up quarter. the close X% was I'll in EBITDA start XX% $XXX.X recap the XXXX continued support reaffirmed million in we're to revenue, consumption morning, from increase first first a for and everyone. year's I'd execute the quarter. our on revenue the lines. growth another total major summarizing capital prior structure.Iridium driven key first record the quarter guidance, color the business an This quarter last well, Thanks, Good year's our of of generating and remarks this quarter with from trends like liquidity Operational provide equipment quarter, in which by was $XXX.X and and and service by metrics million my financial review and seeing increasing of Then some engineering sales. morning

was and the quarter million. related revenue ARPU mentioned.Voice side targeted adopted On service was changes driven strength quarter and in price voice, last the $XXX.X $XX.X first to Matt commercial largely our comparable reflected from and quarter. This increase to The up data this IoT million. in revenue XX% of XX% year's to was rose higher increase broad-based by broadband, business, continued as

GO! We our growth also strong benefited Push-to-Talk from Iridium in services. and

been year first XX% meaningfully $XX new how affected in demonstrating market. by net from Commercial revenue been the to end access mid-XXs pricing noted, data pleased charges was year.To tailwind ARPUs users see hasn't voice million value a services. first And the this expect Matt the to and IoT our in quarter, quarter. in the date, our we've be has additions, XXXX. price received that As action up voice the growth commercial durable, we subscriber in since the in keeping and providing prior increase the It totaled with

to area demand continue to communications, see for in our satellite products. personal in invest which their an retail-focused continue We partners ongoing

While industrial these a they to growth users, minimal lower network revenue subscribers remain in IoT service contributor traditional generate of light attractive they consume. ARPU our the our than very comparative resources

Certus, in legacy mix million. by subscribers increase driven ARPU growth our the an compared usage among Certus Iridium gains integration Supporting OpenPort ago to and a consumer-oriented strong and and increase drive $X.XX grew was in these of believe believe will driven driver as of prior maritime as will ARPU, to this XXXX. subscribers As the to from a $XX.X by new double-digit growth well shift services. technologies Iridium XX% XXX service this from will a Commercial quarter market $X.XX long-term period an products Iridium expect remain and potentially into of that was share IoT data to in continue period. remains We Broadband XXX growth, too.Revenue the and and in revenue year component subscriber result, we that year Certus sector ARPU important revenue Iridium Broadband this our

quarter, gain we XX,XXX with subscribers added predominantly the commercial During by IoT. net new the

million in As represent a from was for quarter, $XX.X remained which equipment, billable Government first consumer-oriented $XX X.X period.We that commercial commercial contract relationships. the revenue record we year's revenue of prior result, well compared at of period. data development from incremental XX% in rise new agency, space first in XX% in Engineering as over the million first stable users. U.S. last comparable the other reflecting services our up quarter year, about last was hardware half subscribers, of the in activity the account IoT for in and compared million, with revenue contract that remains as ago work prior million reflects revenue as million period. Hosting support now the subscribers robust.Equipment the commercial at terms our sales year our IoT and won Subscriber $X.X EMSS supporting commercial million $XX.X grew $XX.X lines the year million first line government commercial demand service the quarter data our to The this was a quarter has with XX% in as quarter. now in development year government. estimate the quarter for were year levels the business plans in also last to $XX.X

the may While milestone trends based and allow achievements.Our first on our engineering revenue year In I quarter-to-quarter we continue cadence from We models price a quarter to X% April few to this voice I full service actions as in year. year-over-year tailwind strong growth will XX% are outlook part and as highlight all to to relevant revenue Iridium's our mentioned the EBITDA. this due this service will in affirm XXXX, earlier, continued us into revenue outlook, well XXXX, between and for and serve fluctuate forecast items comfortable growth upon guidance your with of seeing we of remain that year. and revenue to growth of net execution commercial in the business support across results be our for lines.As commercial activations a growth want in as

of higher annual even with considering Revenue government quarter no XXXX XXXX in effect increase is high that and hardware we this ARPU partner we orders, single set to our products contract will There believe digits remained continue XXXX.Equipment the and that per line and in data fee XXXX. step-up The upon million or occur in U.S. current exceed sales possibly 'XX's favorable our expect in record average this satellite from in next all our positive between handsets Given will level. will record remains this be schedule trends the year. will in in in business, the now the contractual XXXX. demand EMSS this elevated. Based for growth sales other as at voice $XX.X in commercial quarter steady another

systems. the SG&A moderate and related XX% hires in continue in which resulted expense higher employee business quarter, balance expect the of and costs as the upgrade a increase dynamics side compensation ledger, forecast to These stock-based first On in in retool we we the year. of the we to new to

also be forecast second over be to continue we million. expenses that first line expect million new believe number the grow. XXXX up You with by year Accordingly, are growth to XXXX in as market. team higher as we about XX%.R&D half full XXXX seeing XXXX a expenses we our will to to of run across $XX.X expenses 'XX and half supports businesses our about will with good that the expenses expenses and our $XX.X in SG&A XXXX at the products in broad-based recall necessary will the coming grew business of very We that and much incremental are half second have and of more continues of appropriate feel course

Taken million our robust to and dividend equivalents reasons us and XXst, support trends Iridium for program X% and of million had between cash XX% $XXX.X EBITDA this million. growth a balance forecast March year.Moving position, continues allow a is one $XXX to repurchase between and of as service Iridium's capital operational revenue $XXX our together, flow these the program. our cash to reiterate initiated and Board our cash that share quarterly of

program. As initiated approximately total per Board holders dividend on the for generation.In confidence price XXXX quarter dividend and $XX.X end of an reflects paid of of of our we return XXXX, bought common noted, first business total strong the of XXX,XXX opportunities $XX.XX our million a $X.XX of cash Since our a repurchase common $XX.X $XX.X a an million December we average Iridium's back will in XXth additional with approximately of of XXXX us Matt and at Iridium outstanding for share and shares allow in leaving to the XXX,XXX free million. purchased the shares on million, March for share. of a stock of flow cash program also $XX quarterly dividend quarter, in Iridium's capacity

from location satellite first service the complement our $XX partners additional and will by our execute GNSS we who a their to seek to Satelles to Satelles' to objective national global on and expand spoofing. infrastructure very X.Xx interference continue end investment opportunities.Iridium's and was as and continues we first constellation relevance protect net business services, time they the raised their susceptible activity return dividend desire the remain X.Xx EBITDA to first program, our have repurchase quarter. optimistic share to when year with even in Iridium solutions, down on to at the assured a earlier, other critical GPS PNT This leverages offering offering capital about governments leverage during million was factoring business. to buyback quarter. commercial unique are commercial in and and and maximize increased Satelles' balancing which quarter, of also for We the and our investment.In deleveraging

Our X.Xx and share to EBITDA long-term target $XX net were $XX.X leverage buybacks be for million quarter authorized including XXXX, and end to effect X.Xx first of approximately planned related of in to the this by of at continues spare satellites. Board.Capital year's outstanding between dividends expenditures onetime of inclusive of giving the our million, quarterly launch spending all

we on expenditures we CapEx fourth and our XX-year $XX quarter period expect forecasted million. to over average annual As between the in call $XX capital million noted holiday February,

and We million X%. adjustment. of million. a These cash cash of Excluding supplemental free metrics, A return website.In in strategic available approximately Q&A. the returning quarter to inclusive of of and good Iridium $XX this to midpoint reconciliation flow operating conversion turn investments use fall of launch is plan reflection more Iridium off metrics and million fund We detailed continues and under the on EBITDA forma the to these launch-related costs, measures for cash almost us generating EBITDA new forward to represent XX% our long-term closing, making demand description net future GAAP XXXX's this things We XXXX of equipment strong of environment of our from month. think looking in pro capital Relations in presentation our a that, forma XXXX rate We're shareholders appropriate make yield this back cash for our flow projecting services. in strategic benefit $XXX strong flow and shareholders, game are capital plan, our with to free the operating projects, along posted to guidance to our Events payload flow. working the investments ground position $XX to next spares pro interest, for capital year robust CapEx capital, a to Investor free operator growth.With million to I'll of of results, expenditures back should the the X is and $XX a forecast.Turning with and approximately line for

The Instructions] Prentiss James. from first question comes [Operator Rick Raymond with

questions. strong have start are there. to going on year. know is service might revenue one you've areas you to opportunity. -- of a trying understand we not to that couple Obviously Obviously the help there's the people to the I of have bigger direct I showing us in a already year side But to had support focus be direct said device device levels engineering on meaningful device. much It that impact direct some the to from the and like this already reported some seen up? Can seems have got

of device some to kind And gauge as already category? trying to when to will break a date? you direct have So out we seen just

our device look if is So Rick, commercial yes, to that relationship. principally or engineering direct you queue, the it say and support at increase, we Qualcomm

more that run should quarters run continue? it long of Does development into year? several how of can that then something that for Is year? fee this concept next And kind

We additional, see. but for see. will expect time currently, it don't There's we'll opportunities We'll tell. but

in, And then the support? will go royalties start that line same go. engineering and kicking Would into commercial, item, that that

-- break other Yes. and to likely out. we'll revenues. gets going is initially be It's then payload be service going to it big it to in and -- will The it when then enough, we'll vast majority host

out. and maybe then hosted other into it payload go break would royalties and So

are Okay. Obviously, as a well. IoT, lot people ARPUs watching of

Is help. Is as market? priced we it what that like called feels a mid-single think might fair about in And maybe area? You device, Certus the the out that that bring you've underneath personal that we will direct How to communication can seen, mix the should current little digits. change, bit that but kind of obviously, ARPUs think it, given thinking? service that of be

I followed question, that Rick. of last your part

You priced underneath the market? is said what

coming current mid-single-digit think of would is online, to we as And personal kind we device that ARPU ARPU? think that's device ARPU? the devices, of of below kind communication communication personal an a something be So should that direct

terms digits. would or yes, slightly right, mid-level ARPUs communications be single -- below But Yes. It are in roughly personal it level. below maybe, you're be yes, of that below definitely just what would

one the me… And for last

is higher. volume The lot a

of obviously would it. part that So be

Price Exactly. be a quantities. could Yes. of going, lot times it

the of It think good to about me. buyback? putting buyback one like that flow in production April. how we significantly more you the all work in okay, The free of pacing now sounds And Okay. done last What's I questions. put the buybacks? March. says, look quarter How you've stock up at in appreciate the on the a that into the should bit ramped time the cash for shareholder money equation return lever it's and stock to

algorithm and return think an is return where when think want appropriate return -- is to we intrinsic to think we we buybacks value the we we on our is, to where So appropriate rate. execute the

with next Stanley. The Landon comes Park question Morgan from

to if here. you could has can out continue little single-digit And that wanted voice moving benefit Ukraine have maybe that last reversing upside trends that maybe disaggregate That's current and out? X forward? on been you potentially and point? year growth source Ukraine thinking against dig pretty comp even to you more benefit lap the of years? I in you or couple been And bit just if what And target you're on that about that, Can surprising size laying into a the a the confidence some what we of or the how think just that gives delve data high a at obviously maybe over this segment. you're

overall. of competitive to dynamic the that there. our everyone definitely for very several bigger It of have kind There think But demand strong our Ukrainian the services appears anyone and have the talk can be appreciating sort we is a we've been can than Tom is maybe handsets. planning outlasted scheme for were a the else's clearly a benefit, more see, strong do which we've and it seeing for in I previous questions for done announced sort appropriate last by for years, X calls small or a position finally Well, been in seem much. We while. increase in appreciated to market a after as be X price have we know there time that. year. good certainly time. number And we've that It's affected long of years. not you not -- seem I increase over we've to price a very this a felt Markets an ability that a was our to having a of

big course, and grower, and us difference be point.So which to are that going all of growth demand lot dynamics partners We but now. a high working that's terms to the a high all of high, giving think the of that continues of thought was rate. way remains that in is -- for anybody very those things in for remain on they us kind that now that single-digit the of but devices long-term and a market with us In technology things, XX years. told couple Go we That's where almost on in -- XX average, couple years next have versus see new the given is thought have confidence this from the clearly else strong us low they our demand I things Tom and X That to this demand are ago. sort steady still not to those a difference. a exec, all kind like described Push-to-Talk, single-digit Yes, of for at addition years of big next to technology, of like the visibility a our

I just would Matt's amplify remarks.

the I've to indicated grower in double-digit be, 'XX. if ARPU XXXX, solid we're be is you just that the to going going do in on math where a So

you to you that 'XX So annual average about takes and 'XX, think dynamics the the account the all referenced. digits. X together, rate, intended put of is to have is that single Matt be the think, And high guide we into going

there average is last will this we year, been growth think that the hard Landon. we is out observing put said that that that a the think benefit the that this that high we us and ongoing or and dynamics then XX% But segment of more So growth it guide give GO! when XX%, complexion sales predict confidence of Push-to-Talk handset what the in results segment.And our competitive to really. is And are had then single-digit and for we're are between than observed an changes to attached, decade.

seen of I last way, Ukrainian that also of year. already we've Landon, strong seeing sort of not by And say the situation. the this that bump We're was a I first would the year. reversal mean that quarter in the

that guidance already. is to relevant a reversal of And so sort really all of our of

Well, has the out you're but come I question. more the guess, of it of was base? lapping

the say didn't it's of Yes. ads. I see come base. the wouldn't out We

and at past quarter look for jumped ads you if in page. look quarter, So data first the commercial off X year's the years. net first Last at voice it the

year. bump So last the there's but And come bump clearly, activation. it's get not ads used, out, and that you didn't being it's occurred but got they're a we no activation in in still

you wanted ARPU, to extent on it size that comment. it, your out you the just talk So the I just point. reverse at of to magnitude? -- could to And actually pricing able missed Can to reversed Are the the just have clarify I some action? the might about

Yes.

we've that mid-XXs. the in going are So to be said ARPUs

[indiscernible] running. reversal. Ukrainian notwithstanding that's durable, been So that's And

out or? And the look what that like would of magnitude reversing

immediately of still the be, devices less probably X% Well, were Ukraine would off our of than than base. number incremental, our I those of in mean, X% base, all turned less

results this point. our not So driving that's really, all at at really

I if could. more, X just then And

has competitor region. geo primary APAC recently outage in Your the an had

of of you you've up Can a Anything that know LEO of there? if obviously You talk about you some you don't talked comment be value LEO competitive top. about impact can and there heard fluid the outage? And I proliferated the situation. it's if sort anything, design might think

more there and heard Obviously has happening made forward. impact times than anyone have statements that of publicly couple public else about may Asia haven't and going on after the has. a that, our there positive a We they've region services Pacific a in focus anything probably been

difference I in architectures. the our highlights think it

month. point kind this minutes if and obviously impact planet have we and have never coming have satellite had lot But of that of really day. so any in spare the early kind more on a LEO the earth outages. on region any it would even quickly, We of during X haven't any And next we did, satellites would move satellites around

think and focus level I of we'll quality on benefits to is continue brand that. high So Perhaps resiliency our service, and and there be there. will

the to $X.XX provide one what something payments we with unit per last expect device. on below to The is there are a color able direct that you unit? one that of look like in will Or be royalty on -- should sales, any future that per unit to Just associated terms like basis?

even point Yes. at this have happen months. units in in We We the yet. exposing aren't don't that first contracts really service coming will the our

hear be sometime future, the range to this just you but be think trying you'll give I this million at that, appropriate really time. at early That in about information would much a or more point. too would something

next comes Financial. with question The Hamed BWS Khorsand from

stand for Where about that Could you just a conversation? that first you? from revenue Particularly, different at happening is is auto? looking that talk tangents about your does that Or the comments vertical you're now? opportunity a

has are discussions. and implement this take technology cycles the and that the work quite cars We're at and for about it's And wouldn't been integrated is different essentially design technology smartphones. complete What's It working because largely though long. automotive. point has in integration been and on those the automotive to to the details tested planning into long given is

take I fast don't how in that as the Snapdragon of automotive nearly to impact kind as industry doubt on just I know revenues the it satellite for but smartphone so enter it happens. that And will long space, would work design how

years selected who giving of we're strong the and working a think partner of and has broad-based that strategic with fact a just few to capabilities away. the have technology integration I other such highlights as So that's sort well. industries It's upside here this in that we

other purely then my which consumer question was, approximately that additions Is delaying of slowing seems IoT on spending partners product like side, was number think, the the XX,XXX, quarter this new down. is And of it introductions? Or that it's changes? is I -- because

Yes. That's just seasonality.

second slower, are and third stronger. fourth first The and are

right. don't think are I And your numbers

year. 'XX I it's in billable last net think versus XX,XXX like adds more were subscriber XX,XXX

up quarter, many how actually each it's it's but they'll a to few be. So within thousand hard exactly validate bit, a

We think either partners have into so can first much way. different and so segments. quarter many I read you different don't results many

Next question DiPalma from with Blair. Louie William comes

the potential satellite high-end quarter, devices at Snapdragon available announced X Barcelona the Snapdragon Qualcomm believe, make conference, previously devices. Matt and Snapdragon For for, And last wondering announced I Tom, X incorporate around will that to satellite impacted TAM mid-tier XXX the addition premium XX of it X inclusion in was the is a may that feature? And provided to estimate devices Snapdragon million a you year. phones I million with of how that

and that mid-tier Well, what devices I of mean, already we from our we've understand, there a ones being to shipped are view described. there's high-end those more lot of manufacturers satellite Snapdragon phone sort

phone to the how opportunity adopt will on large. So quite the just many technology. depend manufacturers is decide It

the be see I would the necessarily end, most think But focus will will introductions that do I at be a incrementally term that. high not because hope but lot that long and high of Our it's to 'XX late expand. really do on 'XX the

able royalty for mid-tier Snapdragon the X to say premium rate Snapdragon is in rate X lower devices if for And the the Or are negotiations? still that than is you royalty devices? the

It's of to premature about point. royalties at talk totally relative sort any levels actual this either or levels of

Sorry.

No I working consumer this higher to devices, perhaps the R&D And is software radiofrequency think, actually like new to year, that? problem. in sector? Tom. R&D such new developers like on our other and like R&D like IoT support Is That's completely Or the you Qualcomm for support higher referenced that devices. understandable. that for Tom, partnership, this Iridium engineers

other in generally. say, would devices in the consumer I sector

we it feel in lot in our work right cloud, we and projections both in our things the believe believe -- now investment expanded of work. and do here. growth in work we've gateways a list just It that of so it's device to because because right we that lot for time can long opportunities, that support We there's our have we success develop, a a ground the require Iridium. growth, And on both to want opportunity in Yes. of our we work given

And I relates ARPU IoT as you did that forward? expansion Tom, that? actually the mishear say, be to might did going it there also Or

No. drive said functionality would drive service should higher usage, slowly. that -- data the ARPU we're which We higher

devices that for would And consumer for be like… those Certus,

a device higher higher ARPU. I think usage it Garmin was pictures. pushing That's is

an be lot technology, they time there's pushing for adoption have offer long partners, win Now I that even to those that have in devices to but ARPU. it devices affect we're more some have a future, to we some overall plans and products that positive well, and amongst it's ARPUs of use X mean, obviously, which would been that will capabilities as today. than the introduce take in million our there's on narrowband the just to market obviously given awful because soon get already more

like {Operator have a It Instructions] Raymond from James. follow-up we looks Rick from questions. concludes This our Prentiss

the just macro if we market out there ask is just It as question. recession globally or product condition as economic it strong? for don't demand is? impact be remiss question would probably Are seeing the what you still the far any super the Or

consumer wringing here there I segments. California market in conservative trends seen not different be first for type those in conference segment specific think we're of partners Well, number bigger We to big any to our I of particularly we're think of it's of held in keep was ago. yet. ever places too far the or couple case hard in out I and say the weeks I things overall in affected being just no possibly effects. impact see like is anything, enthusiasm here. as looking mean a are future. as projecting any But a our high XXX-plus just years I've partner hands I'd the whatsoever. in we've seen don't There

for one me… And last

downturn. are the in think our market cut -- that time to would I services think some I critical And recession. a the of that very have in I sort satellite a like are we I lot a We kind wasn't of services. see ones history, first We've great Iridium of sort and then. They're that of be ones regional thing. life, And mean didn't think world of they're XXXX-XXXX valuable sort impact experienced don't

you time. or as your using costs? interest up balance debt the one thinking the of on do sheet? anything Anything you do thoughts some level far of Tom, can Last might as the on any

Yes.

we're We have our $X down paid a so on billion. $X million. We hedged $XXX billion -- cap

dividend. about going exposure diligent outlined we're That's strategic Rick. rates. interest what feel our make the we're to have like contained in the we so to to -- it, investments, the going But And do. pay And to We're shares, we're game I we've think we continue plan. buy

And any is update on business how far going? Aireon as as that

of believe markets grow. back come traffic traffic I their has in and now starting some to mean, have I They're levels also terms Still air services. investing more to revenue normal continue in that started has they they're to increased get control actually levels, moving their that's their seeing but both other there. traction data long-term positive. very a kind commercial services that air of opportunity, business, adopting

say, the positives there. over So most would of I

you mentioned I by the number. that investment? into an Tom, And all was you investment missed What Satelles,

$XX million, Rick.

Ten, one zero?

One zero.

with Landon The a from Morgan Stanley. Park next is question follow-up

Analyst your high, And products. the the pricing I Day, if plan wondering just service the ask us that to could on or you commercial of there that that aviation think, the market. I into the think coming to was At range lease I about Certus quite maybe still are the remember wanted see -- front I seem right larger mean $XXX for -- remind there? now to pricing quite being products. Is for I about TAM plus. expectations. those you were

and thousand of to few XX,XXX terminals both wins got there, going the going than coming. will data of with little that's time, we're they always installed service it's seen -- higher broadband I'm the We happy those see for into which also that know the high. Certus some and to they're early add say that expectations products, and ARPUs it. [Technical this that be getting on move to think looking really they're think the they next sort up unmanned build ARPU year planning lot to in services, trials somewhat commercial wouldn't still don't what ads and then that's primarily project business and that our really hearing potential I are going and really is of product of to drones, in and fast, the to is interest for to terms just applications we've mid-band into to I those for rotorcraft to about Difficulty] are more going platforms initial specific roughly towards more and you're very and products at market version a don't this think We're going positive but airlines, because of with very should into it aerial which a as of but continue because especially year our It's through in for the sort with are The going but the little versus partners then early push too a into -- X flying, a their in and commercial aircraft of safety lot start but activity aircraft which better come front. Those take flight safety and before. stages others. year, And that. STCs rotorcraft, things I I and be vehicles.So products end of we we're seeing be the year that But early kind a in more a thing. line segment,

that in there the segment. also will improve aviation the So business

you, one for one maybe for just -- last Tom. And

operating in expect limited of in investments your Is expanding XXXX of the that the year for in to in the something should leverage terms this On EBITDA the because cards and contract. you SPA of more front, guys it's we business margins? sort be beyond that and the

leverage cost hard intact, use, minute buy. the for operating really it's the is to an look if incremental So produce you to right? of So of variable kind

cost incremental business. operating because EBITDA It business leverage decreased. margin fundamentals grow. But to service producing revenues kind intact, we of EBITDA there's grow, -- is has leverage that is is the the service isn't the EBITDA you the operating that I because the same of the that lower not and and SPA in in big So margin. -- intact. with relatively our that contract should agree grow as appears will of It's continue the are to SPA as

That that's true line falls or margin, is the dramatically all which all -- years. of increased all too. X over lower X I to this equipment mean, it last for is bottom cash the positive, has and And but generates us.

good a it's So thing.

that and mean you should And SG&A is growth is last bit think point? I some the XX% Or that at that… this a will -- last moderate little the year something year,

Yes. will That moderate…

should rate? think about How we growth that

over That will time. moderate

follow-up The William with next the DiPalma is Louie Blair. question from

it I like your satellite seem question have have competitors but in have you? supply phone experienced a chain terms doesn't impacted to of issues, major really why

personal to issues or that. own for my competitors' ideas have about appropriate I our sure not me I'm describe it's problems.

think business is I their smaller.

to technology their more outsource I others. think of they perhaps

have team quite the my chain situation control don't supply And over excellent anyone they we so do. longer I been We've this speak work to the the does. has. can that doing only than

of parts done.It rather we've that importance But my really we our now. just perhaps excellent from supply really out the breadth years perhaps, the and in X we're had has, the X.X are interval a suddenly maybe in ago, the week of I were pushed year. come perhaps that jumped chain would to priorities things from or have think they experience, relationships higher X of chain that months top more out than kind were volumes of hearing a scary, would with were products of because I team of of markets expecting as drives more on that serve, focus worked X partners and we think got maybe positives on they suppliers just I and We others I what do.But fast on it the really our and say, little hard higher year, looked supply sort

remember all whole almost case, challenge And mean, our in the had certainly I demand. I higher of during over time, we that I products, think pretty phones. from much it's incremental

were all just always time the demand to of at us those important were challenges. So working we others be we the grabbing through

I was team to an to we owe expertise just competency of had additional So more and that my But work than else. with. it the complexity anything

is like say Matt to our that to amplify satellite strategic us. highly business phone just I'll to

feel stock at about We all our competitors as in build handset safety are reluctant It's business business. invest out way that support to same of not in that the unclear ours. we their

feedback a this year, in initial your GO! you earlier revenue segment? partners? And exciting like launched really also product, device. of IoT GO! does commercial exec, channel go which been exec Or And service does does voice the for reporting and from Iridium What reporting that data the the the it into the has that go seems segment? the

Yes. data. and voice It commercial goes into

was it other open services. It I flight. it's I smart anything long it as using e-mail. it's just sort tablet has allows Multiple product. a mean flexible, reception very, a just with a far on battery-powered portable a high, myself As supplying that more on allows basis texting. the to than unique isn't speed of connect higher extremely lines, is that interfaces. voice speed or day allows very There do

providers field even X,XXX positive had channels very, orders, it specific I as today there well.So product people. are think was selling already. start our So products drive to to going we're that means applications, and which I so seeing which the announced for first of thought application they We've some be can that very to their we very adapt reorders they're

help use So addictive, kind once it's more. can't of of that you product. you value, it that think but of kind find it's of I introduction And a great kind

small I in our headwind compared a begin ARPUs tailwind segment, a it's revenues or all So though that it for be addition. a to be quite But positive even of will imagine positive general a to quite little it's with. -- our other

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

us I September in you because growth you us model how why Investor hope and think more to our way confident believe like Yes. are projections in that an are the York I'd planning our there XXst. provide are. we've again looks details Day all we they we remind you projections but we Obviously, we'll our long-term makes what July, on about see join New scheduled longer-term and in can

joining you. us this to So then. seeing forward us look on But for call. join We thanks

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

You may now disconnect.