Viasat (VSAT) 6 Feb 242024 Q3 Earnings call transcript

Hello, and welcome to the Viasat Fiscal Year '24 Third Quarter Earnings Conference Call.

Your host for today's call is Mark Dankberg, Chairman and CEO.

You may proceed, Mr. Dankberg.

Thanks. thanks us and everybody, afternoon, for today. joining Good

Guru President; and Shawn with Blair, me, our our got I've Officer; So Duffy, Gowrappan, Chief General Counsel. our Robert Financial

have disclosure. I'll So safe provide harbor first, Robert our

Thanks, Mark.

you a that differ is materially. As statements. results cause reminder this contain factors discussion forward-looking know, This actual could to will

SEC website. XX-Q. Additional these contained is our to factors information available Copies including Forms are reports our recent on in most or from you, Mark. the concerning Back XX-K our and from SEC filings,

Thanks.

Okay.

we on I'll with on then of for encourage and allow give points, quick more time afternoon details. reading we Guru So main the will shareholder we'll questions. we'll of our for go plenty that on start letter satellite And an our the into posted the quarter. then fleet and a status this depth overview of website overview earlier and our results more

integration, including priorities, main as X Inmarsat Our our that described letter, outlook. the and in update

Our from on financial up to up about year-over-year were million, compared good. basis. XX% standalone last year-over-year for billion, revenue quarter of $XXX $X.X Revenue continuing Inmarsat's contribution was operations XX% year. was the a Viasat results third

X% was growth Combined year-over-year.

last was Combined EBITDA last year-over-year. EBITDA XX% XXX% from million, adjusted adjusted year. $XXX XX% $XXX continuing EBITDA about Inmarsat's the Our year. third relative for about quarter up operations up grew million, to adjusted contribution was

or Systems contract $X.X of has good billion at IDIQ, in about also very for Quantity, Government third value. Indefinite resulting Awards billion also Delivery/Indefinite potential unawarded billion were the quarter, backlog, and $X.X in $X.X

government core in including enterprise selected market grow ] from Intel our [ services. segments, to we're continuing target mobility and business win our results, and

where value but connectivity that our continue also geographic bandwidth, customers X only requirements. coverage those of and in affordable partnerships includes attributes. service important verticals products compete just to bandwidth to and key with optimize also hardware, An unique are integrates that speed we and but not add in reliable, expansive not and and in also bring software and/or view tailored that And customers' regions. in that scale, measurable main support operational We value

we of earn years evolving business both and and and finally, technology Three customers and customers right partners for history applying markets. is through of and and trust of similar models our target performance where those technology recognize our decades identifying, the innovation;

our seamless in few key up and and a Deutsche network, and existing expanding Skylo applying business to new new production partnerships industry satellite government with cover Ligado, infrastructure hybrid I'll expanding highlights, our connectivity cybersecurity nonterrestrial Telekom, in-flight winning technology programs. some network and services through government including scaled agreement with services standard Europe

customers' engagement to our service at busiest deliver We from airline continue connectivity supporting and metrics, high-quality important leading airports to free to preparing scalable the quality Hawaii. now increase passenger such as on increased metrics, routes, geographic WiFi even the for coverage and with continental offering U.S. in-flight initiatives performance

'XX. on for commercial configuring the operational results and nominal with progress and integrating, starting ViaSat-X completed first connectivity service performance. measuring over in give taken testing antenna date, update on in-orbit the now quarter network, performance than X We're service and analyzing on is or I'll Flight our X. next, And better. Flight Based quick other in-flight satellite affected a targeting fiscal we're We've to operation, of

area on antenna productivity on -- actions third the was second to its findings, features ViaSat-X, implementing peak downstream time quarter. initiatives. terminals support bandwidth root the The already such range. investigation across megabit X we're hotspots dynamically optimizing real the Based the of allocation corrective We've The Flight in cause per consumer as XXX completed into FX demonstrated delivery in product rates antenna. service data our in XXX to

completed, to in satellite expected the otherwise of and The calendar actions 'XX. first thoroughly half corrective calendar FX launched is FX with is antenna complete. The delivered tested expected be and this is be to year,

expect remains The year. to launch FX unaffected, it ViaSat-X and late calendar we this

also We improve vacuum commercial They this b, routes. hosted and mid-calendar and polar government payloads and for to and coverage GX-XXa expected are have completed satellites, they year their which XXXX and on together thermal are polar performance year. testing launch will

to satellites expect to new in next constellation of have those our services. calendar summer By 'XX, scale we mobility X

early coverage to deliver X Additionally, our flexible expected to 'XX improve GX-X, peak satellites Airbus will optimize geographic completed satellites for high-quality, reliable depth. X beginning calendar additional to mobility and customers. and highly further demand being our be and are and capacity services are the ability built by Those

with over So results to Guru cover quarter third it to hand our that, depth. more in I'll

performance, Thanks, financial QX our cover an Great. Mark. on I'll and key integration combined outlook. topics: X transformation update and

strong and businesses. during delivered revenue operational financial Core government driven on X% performance EBITDA, core by executing year-over-year XX%, are both adjusted We our and and QX. strategy and mobility and grew respectively, our by

key the include: assurance, information demand product Government drove had quarter SATCOM Systems the revenue our another highlights high-speed encryption network products, of for which Some strong up XX% products and from quarter of year-over-year. tactical

exercise and U.S. software resilient XXXX. connectivity. and to Force next-generation through products the Guardian supported provided we systems quarter, in communications robust Mobility ensure Viasat major Air called the interoperable and hardware During a

government quarter than also sequentially. awards, were Our more XX% business of fantastic had a up which

combined commercial the the is see the confidence can IFC, with we trends quarter-to-quarter lumpiness Satellite in fixed Recent a adding ARPU. residential in offset higher U.S. declined our outlook. revenue $X.X backlog ending growth continued quarter to business, billion, aircraft subscribers were partially with backlog. up Services in over While by strong broadband in in year-over-year aircraft as on over XX% X,XXX fewer with basis X,XXX service, over

existing network integrated to by to our solutions Inmarsat aircraft together satellite Lufthansa hybrid great Subsequent our their we support end, a XXX bandwidth teams reallocate to alongside with enabled IFC and Ka well. rapid working continue expanded our adding It's the adding network relationship of fleet. are We growth. really over Group, the example on quarter EAN

mobile the first Release-XX global chipset the global for our market Skylo products world's direct-to-device We coverage. time take service also devicemakers compliant to XGPP and to in Technologies with began network-enabling network manufacturers first network L-band launching satellite nonterrestrial within partnership operators Ligado, and network with

And finally, on the list of new highlights, our momentum robust. is business

are large government growing and in We winning the mobility markets. and

uniquely the and very that complex It U.S. Our unique where has government are these IP others. ecosystems at resiliency business evolving address the security fast that operations forefront. bolstered for critical solutions enable is that are by and government and

awards of $X.X billion XX% billion, at unawarded backlog product are billion. at $X.X key IDIQ government IFC Some indicators total growth installations of and $X.X XX% value year-over-year, year-over-year,

Now some more color on the financials.

of Systems revenue up driven This XXXX, $XXX in Government $X.X XXXX was X% growth from IFC quarter both strong million QX XXXX years, was revenue in year-over-year, by including in compared to revenue FY up QX service. Third products Inmarsat continuing billion. was operations and XX%

loss year-ago year-over-year to FY charges. nonrecurring growth. Inmarsat from increase $XXX interest loss of primarily Net EBITDA million $XXX with in up increased expense totaled as EBITDA Inmarsat due million the acquisition associated management the line for in XX% QX, adjusted good years, top continuing acquisition-related including operations, year-over-year Inmarsat our $XX XXXX, an cost for leveraged the million, the from Adjusted quarter both period, was QX XXX% net up and was

approximately of EBITDA to FY Sequentially, favorable estimated time increased adjusted the XXXX, QX X.Xx at acquisition to leverage X.Xx combined as the was net LTM Inmarsat substantially announced. plan

sheet financial balance cash, and cash quarter at significant short-term our no funded $X have including and equivalents We $X.X flexibility with investments of maturities. near-term on billion liquidity, approximately billion of end

to path positive a Importantly, free funded we cash have fully flow.

recovery for were before and $XXX insurance ViaSat-X of calendar claims are proceeding. filed million year-end. Finally, Claims IX FX FX

proceeds over few We to next expect receive quarters. the

more end, majority arrive anticipated another for XXXX. date, we received have quarter to Overall, $XXX this than million to with Viasat. quarter strong to in was fiscal Subsequent the

our touch will integration on mainly mentioned around Mark As letter, in earlier, priorities discussed we transformation. and X I

building connectivity engagement models. in momentum momentum and fastest-growing I scope in financial help financials core First, Aviation progress is of Operational unique business continues use to the our benefit services with of the covered. we good and be deliver customers aircraft performance to served their area in just reflected that our and passenger operational our business.

reputation measurable quality. We service our for and are predictable, reliable of proud

pipeline new robust. order remains Our

Our from portfolio innovation differentiated an hardware and an benefit also services of service innovative and products. businesses and -- application software

reducing operations, engineering Inmarsat expect. took growth achieve capital to is go-to-market, synergies financial integration integrating supporting but costs teams, resources and and operating step second and scope Our painful, ground reduce and sustain our in leveraging services. necessary scale is the of our the space and metrics we a to the and big really people achieve to infrastructure, revenue QX, priority expand and products We

by announced networks support FY capital XXXX, start-up the cash We $XX about free expect We're achieve $XXX target was integrating than scale to to cash flow. million and and also further about sooner synergies million quality, X acquisition global our drive when the savings by and service years. resilience improve annual better positive the to and

mobility cash is priority third to business advancing while flow. sustaining growth The inflection free the positive

asset best world's and demand and in our to peak geographic target needs, Our is strategy time customers, especially airports bandwidth productivity measure maritime mobility and major such the as by hotspots drive matching to delivery ports.

X under and extensive as applying to data construction as satellites our well existing third-party leveraging techniques are satellite and our optimize dynamically We learning machine global forthcoming assets. fleet operating our Ka-band

to technologies quality enhance driving and dominant bandwidth efficiency, unique video factor also streaming We're usage using a growth.

revised scale have service cost measurable simultaneously productivity, increases savings, quality. opportunity reflect while to budgets Our in capital further we the driving

we impairment guidance. settlement charges quarter outlook. the from outlook, nonrecurring to last topic We the terms in moving on from satellite next our and exclude announced exclude Now of the -- litigation benefit

the FY to a FY single-digit in combined billion. $X.X percentages billion we $X.XX in XXXX for expect high growth revenue For over company the range of XXXX,

XXXX, the growth for percentages XXXX we combined EBITDA the expect For company. over FY in mid-single-digit FY adjusted

XXXX billion the in adjusted -- of our growth expecting range, FY in to continued the EBITDA. under Capital billion current now are billion at our are $X.X adjusted We with previous revenue approximately in EBITDA construction. expenditures $X.X $X.XXX top and in satellites expected both current half

satellite placeholder our our IX benefit maintenance success-based activities. for over inclusive a with of insurance the potential billion both spend X/X CapEx network projects capital from our to in decline of less than expected where replacement. the include associated general In CapEx which XXXX, total funding million other $X.X and a of does and guidance investments as an we In FY not expect drive growth, to FX X/X Capital $XXX CapEx, QX, billion, recoveries. to expenditure $X.X range of to compared

our which interest capital $XXX million approximately in year. basis, structure our planned net is per and growth well include guidance, spending framework. we liquidity Note a fits on that within So capitalized our CapEx

investment plan, reducing of and on and that working are mentioned closely We we taking to our capital advantage post-merger opportunities optimizing sheet synergy earlier. balance leverage our capital is tied the and

Before two Investor wrapping up, scale post-merger. We I felt Relations time in doubling given have to nearly share. program, our it size important our to was updates

We've will happy enhancing companies the including sectors and And weeks. Investor coming of and to immediately more instead a heard growth growth -- that about I'm Investor unique on joined Curran So Relations. investor and I'm introductions experience on breadth multiple will we a your team of and for across sure you insight Pete Viasat announce of giving with as with talked depth on a to Lisa brings businesses. reporting listen more VP fronts. our Lisa Day outreach, all our facilitate Peter of number We've feedback our disclosures focus over has and transformations. Lopez our leading plans through you you

to We more of feedback. forward getting look your

that match are to want your are we we have competing day, conviction we and every our We our for in ahead, confidence. you path capital aware

next We update on expect provide to an our earnings call.

our path flow is launch first markets, to we satellites. driven meaningful rationalization execution as growing on including and our year benefits decline positive from from sourcing large and the in growth calendar our government. cash natural free backlog, which cost Ongoing half of mobility prioritize the CapEx sizable by our and Now XXXX spending,

are synergies, structure and with improvements We scale driving cost benchmarking.

Inmarsat be on was I'll XX FY pass company back combined grow the FY very substantial clear, QX in to and 'XX growth our track of expect Mark. we in FY it 'XX. good, Our synergy value and on FY and months 'XX that, full operational a adjusted and is performance to to are With 'XX. achieve And based in EBITDA revenue to

take to Guru. Thanks, Okay. be point, this at And happy we'll some questions.

first Prentiss from the Raymond comes line with Your James. question of Ric

that First thoughts you, employees and with had with are out you've your families rain, all there. weather

hope I is So everyone okay.

-- half on have sounds that us XQ 'XX, the appreciate calendar like business side is 'XX calendar update there the first things, Flight of before On needs of any the any occur X investment help X. actually question. of and It Flight X? so gotten I of kind late the then network And through another ground kind insurance think in for as with to that come or we Flight more the I'll more any you And that? kind yet

Okay.

where had ViaSat-X On capital the the are when think through about we we the capital about investments, we're -- I total that program. investment plan started XX% we is

So go, XX% to that -- segment. the and about remaining both and ground includes ground initial space

And for Flight then insurance X...

Yes have filed still that good, we're 'XX. claims. FY looking I so probably but are on be that think in We I think you'd you -- yes, Things that. working expect

that through now questions is we status going our the responses Yes, over Flight the claim. And the that we'll X. filed with part of process third insurers do and of the insuring for flight

the Viasat you the pointed help the side. bringing bear be little use that you're that kind should out Can on a we side bandwidth at then, you into you're marketplaces? that thinking how birds, Okay. us and all Inmarsat these to capacity bit a how level understand bringing both maybe much to high And from of best looking the Guru, new you're with

And you maritime, a think those we competitive I'm against? us making of pressed what you help where government, look and complicated think feel profiles like it in you're then might the -- call question, that those aviation, should about silos you what growth about apply most it capacity we who consumer, dynamics rural understand more but also then as GAME, to want how enterprise,

Okay.

Okay.

So there's a in there. lot

yes. A lot there,

things from have fleet first the the individual capacity and of fleet performance fact satellite. the entering that -- are satellite, now what main as whole. the that the using whole first satellite our emphasized incremental first is the now places, operate we Well, one working a just the size things is of we of individual and from covering so the the And the part comes on we each on satellites we when business that than you get and of would effectively of increase were given that to that early way fleet was each one more we multiple the

So coverage, is of the areas places in are mean, -- at the any I just like the at idea it really cellular -- coverage the of if and are of beams this way, less efficient. middle beam the that the look each are so in the satellite that that think satellite, most of basic beam efficient, edges you that are right there

So doing the -- the on satellites, is way about can that all don't way of we user up allocations the all the one of of in to reallocate do things terminals think fact the since by that patterns line satellites most those possible. efficient we

at fixed off to because time. satellite any do And be that satellite is is with to are already able to handed easier terminals much it mobility with from than mobility terminals

part The talk and peak that that is demand pretty dynamics, one about is other that things thing, of can high demand. high we competitive which very ratios have always easily to about demand measure goes of the you markets to average the the

a about that on airport day, might peak XXx lot at X think those airports, connecting the So the times. with flights, have X of has demand times especially big average a a it or it

that those demands. had dynamic or move dynamic of that an in have places beams satellites more recent So benefit to more have steering different being around additional than high bandwidth able the we've our peak among bandwidth past have those steering the

peak in of times. the the plenty is on data thing other And those we differences have

in demands the same airports. the Chicago, in necessarily Houston hub they Dallas, as are other for So instance, or Atlanta aren't peak

can our WiFi. then of individual bandwidth really in that overall of amount match a The to increasing patterns. then are -- main markets we mobility the biggest those in using optimize So bandwidth engaged trends use passengers and passengers these the number are that both

WiFi they that mean from it, we've change of of airlines we way kind catalyzed. -- you to really use kind it's is for don't don't credit that's it get having And So if right. the passengers explain the any really I

So the up do challenge hub having has big without at bottlenecks how you airports. engagement the scale these been

or -- they're in And the manifested it's the in expanding in enterprise and whether lot leisure ship, that a way it first going depends on ship markets of maritime that's dynamic or U.S. a the as ship markets personal There we effects think is is internationally. a type that's maritime a of are a similar playing big in think really out on ship.

moving moving is it's if its And is it Or people? enterprise main function cargo. ship, an

on we're so also because doing then and working to ports. combination you of of lot the imagine also each example, an areas have what maritime can work major of areas airport is on the are is, you a As big those those

Basically, is supply we those can what of so are And we're do the two on working dynamics. that match that and ways. in demand,

is using one And at choose so can those that way thoughtful optimize the points to be on. deliver is you Does about the some that talked that about had? the I cover other One that those serve to of they're the the beginning. the techniques we -- to fleet counting we really that that performance customers

time try spur this sounds and geographic And you're of stuff of of using time -- about bringing you should the feel to of bear you market to amount demand. to Yes. convince people, ability and time good at market the -- day, bandwidth and it the the like and right sorry, kind be

this to go-to-market years. in And kind original U.S. in we've in-flight those proposition value It Yes, been it's of all of the was our those. ability our for the refining do space

The deal and users perturbations data augmenting are to that planes aren't on data. our And with then constantly fingers is that helps those scheduled types industry-based we've of for or that. got with those also data worth vessels of us scheduled. have that We but we years evolving,

all have service going are stuff. the customers certainty the you need So that combine But to to that's providers to at like feel government enterprise direction and to want. deliver those that we go

comes Aluru next line from JPMorgan. of the Your Nikhil question with

what question what level If those you guys might could as higher more that feel give backlog. about on you to go-to-market. need pacing you ask of or touched X,XXX there I the potentially intensity Is if that think us you've online? that change IFC, Mark, the you maintain growth to on you're around how business they quickly like in look come has kind IFC help a like? us this like and anything you could mentioned activate then some able the IFC, the you promotion color on Maybe rating looked pricing plane at? And competitive been on run the to Can

Sure. Okay.

OEMs, the is a there's ranged -- we're rate They factors new aircraft But many fiscal -- So or rate as XXX. year. We've to some especially of from of of main is constraints, as bit is factors done end some at of XXX. so lot components. been their or -- from looking little the the Boeing unpredictable. lot The so we've of it and around X,XXX the and probably X,XXX delivery have major demand, next one of they deployment biggest have In around a Airbus. of including quarters, from supply by XXX currently going a

now. a be little from would over a that year So

delivery of affect planes based which that rates a retrofits. -- think customers' slows that that's new current and the how -- existing our take planes those service and If on reasonable sometimes they at out retrofits. for don't I they'll that delivery new rate But assessment rates have then

that's estimate. I a reasonable pretty think

say, the -- drivers a kind question things. to And growth us, let's -- the of about few biggest going say other what are? I'm -- I'd so talk the then on your about for

carriers tends of driven have CASK. low-cost connectivity mile generally in-flight the be And carriers really seat is by that per than, customer to approaching [indiscernible] carriers very or carriers. ways of their some they be have are base global to compared -- revenue the can One low-cost long-haul regional driven business by premium carriers then different say,

not that think idea. the it's good -- I a really So

approach we So I mean don't approach really as it one-size-fits-all a not it. it's We the way market.

market happening of do passengers the kind we is play especially some is will don't a years, U.S. theme, see to competitive quarter-by-quarter the of dominant What any connectivity they is in next basis which dynamics and few a over from probably on system. internationally. That are airlines saw don't that their out it's the that first use this we get really starting credit spread if the notion the that

So that video. trends the as increase -- of increasing to them offer need passenger generally they And are something want more it to and then engagement, of passenger and you engagement. includes something more really think main that that

that bandwidth So drives demand.

the what then led been how add then airline monetizing we've and a big when different monetize you of level if the do has airlines airlines just agreements they have happens, for of ingredient well-defined can having have us -- for issues that are increasingly deliver? costs, service that and helping Different that we don't confidence airlines measure. engagement. strategies really sort the The that other airlines. to monetize lot work and that that those the it And can it. doesn't they more successful at is But That's

the main that on. to each of airline. engagement focused business we're the try that of the increasing for aim works investors provide And going visibility with to and one supply areas bandwidth of on. So model things into That's idea to of the we've been a building increasing more the one that

Mike question comes B. with Crawford Riley. from next of line the Your

questions A couple of the L-band. regarding

elaborate you're First, can some on IP? L-band the ViaSat-X that contain may of geostationary satellites whether you that smallsat your and X discontinued developing

innovative pretty ViaSat-X X features. but on based those -- they're which were geosynchronous L-band X Those satellites of satellites, IP. by a for very variety satellites the bus merger L-band started interesting are prior low-cost do Inmarsat have new completed. aren't. The to being They not They're No. some reasons,

those in XXXX? launch And might

Yes.

by XXXX. intended reasonably time. -- to going Part be by they orbit will they're have the of is think in I raising to service -- it in

into orbit but are to those through this the mission, point. the and bringing launch work at ballpark got correct and raising service So we've

service could you, Ligado, bringing or whether phone would separately the NTN any phone? then TAT on elaborate such be a to iPhone formerly a direct-to-device Android and more just -- Bullitt Okay. would are a or to of that special And L-band, as device and phone requires this on you each this Skylo that or what like table

Okay. Yes.

But as what -- smartphones is terrestrial the nonterrestrial different is the the device or makers, integration or to then device it makers So often well. networks -- over-the-top as -- operators, also you networks. and of provide happening think satellite from satellite think referred in interest expanded that then market in The devices. have networks. to services think And and And network device perspective. this user's parties about mobile to NTN of it here. companies are data of -- other of services as motivations And

to to location some basically around So modem some for are services. probably prominent this looking what's functions being terrestrial devicemakers are -- general see. There's L-band seamlessly satellite remote one specifications are see type for And services. is service. standardized working so also a -- the networks bands. integrate that most to delivering what handoff theme the what that's device frequency remote that of makers this or you'll are integrate the really And you'll standard. emergency XGPP initially cellular chips. these next satellite in then generation the of remote from That's And

cellular extend now be a the coverage. The fill communication into have black is would spots remote and you coming connectivity are will connectivity also that services in if you remote just idea that range also device devices. that that to what satellite messaging use would think and built we in be benefits then And from

be of ever market cellular away, are the probably -- to is or determined, know there where and part this part Some ranges coverage. in be and deserts wasn't people you some far won't of that but is often mountain

hill a or mountain of are dead a though in near are side cellular by But or shadowed or disconnected they a similar terrestrial black things devices lot spot like a even coverage, or spot but that. just

-- people to terrestrial that to the all on licensed the you So have augment lot out aiming to these think are things makes is satellite, satellite part serve that fill of industry take one sense with terrestrial can existing and if big cellular take is that spectrum or of with want is we take black this spots, have frequencies doesn't going you to the those of whether carrier any and we're satellite have for, -- a terrestrial to existing service. allocated in to spectrum and you, cellular you use. dedicate will They in spectrum don't the it and

standards that's is services so scale think, -- get that is attractive. what both capability. way about -- that That's XGPP the and the these are to that's enabling more We ultimately, make

really interesting right Ligado We're of that a doing with So away. do Skylo tests devices. put and office much together now start scale we the in with working U.S. back some kind network has pretty what solution to lets can us delivering help We're services those

with globally it. And And all forming we help can rest operate the our we They [ and most Inmarsat, kind them of develop advanced then -- for we've We beam extend across fleet. that helped had that, with Ligado they've also have ] years. a worked of ground-based very L-band, the satellite.

main that's them So going to to starting those say you'll on that talk that the bring and market device have near what's now. later capability I'd choose year. thing see NTN this future their the about satellite are the probably of products chips makers kind

said, still in discovery development as have quick with Mike. is, don't for CapEx of One, mode, and and we market incremental Mark any this clarity. clarification couple points, this A associated it's deal, just

start think it will will build, Ultimately, we slowly. think we said. now, as right And this Guru

describe it. a discovery way to good I is think market

Okay.

Just one final question, more on the financials.

thinking and be in how variability this quarter-to-quarter is quarter what the the your that revenue? next and was -- we and quarter? how cause the March in gross And given should mix gross to year about services, for say, variance products also that and products Just on services margins regarding margin

Mike, it's Shawn.

on if about things. So business. mix the a couple a this of we government of little favorability unique is think quarter, there's I had you our One bit in think

little we resolve and service were had And side, of so had with customer margins. negotiation also a we to bit yielded that improved the able that the on a -- we that kind so And well. as a favorability some contract had

going and So from not the going of that quarter. and down little expecting then that's say flow-through to of would a also, are things well. benefit we to that, And the accounting meter keep acquisition bit to as next those I start into get the I'm

Koontz with from comes the Needham Company. question next of Ryan line Your &

there if you Appreciate back, your Number in commentary, of in regionals of those where haul maybe we are you western Mark, targeted of for characterize Maybe versus one. kind strategies. different regionals? long-haul penetration take long kind can markets and view we and markets about the your step how major

second in looking is needs. that wholesale fill you've to to bandwidth that you for might about talked partnerships the on fill any plan question providers table gaps Is a with the of still And before change have with relationship other FX?

the Okay. market. say I if is, don't I'd at of like would you like Sure. want -- the in-flight that is, the Yes, look be that see region future to what you one regional, U.S. if

I'd and a domestic U.S. say. the from flights the at that's U.S., to good a to market as international proxy compared Looking

range mainline are typically the of domestic maybe of passengers. On fleets planes, domestic couple single-aisle the on couple of a hundred the a part, hundred

a mix there's no entertainments and screens. some, And of seat-back

media those devices other at say entertainment well high be to and I'd do, things friends or integration entertainment penetration over So still communicating main between what watching where both of first flights pretty or well -- we'll XXX and options. serve of reflecting social one with of themes those we're times. a peak is seeing, going I'd serving but devices. connectivity doing And And fair at people on their -- or -- you're many home, say, the very sort greater they're

long-haul a In business, the -- been say, long-haul that has been, the market a people. that planes the bit behind. because lot it's And little more has I'd have

high higher high means links. of So engagement, capacity bandwidth,

large in domestic of twin-aisle markets aircraft, -- that experiences we're but world, I Australia, the bring long-haul an parts with think And that area some market have and ViaSat-X the really in really with so in, entering Europe, been the the to similar markets to U.S. new as going of say, and that's Brazil, our we've in. intra those the, we're big customers like other that satellites, to or Inmarsat now, domestic we're other been the working to well do

is Also, think -- it's part on you're see that, also you'll mile and is the still innovation seatbacks combining parts. ]. focus important really a lot connectivity low-cost big a the seat are entertainment because going penetrated because I [ of be of an carriers such to their part really in cost to -- that's per The where cost that's see

the think, So be on haul. is these on going and of to both domestic regional dynamics monetization Does the factor those building what give up I sense some the long strategies, a fleets in are? carriers, low-cost you big that

schemes talk Yes. complementary in are there? of about can revenue When you you like per Or kind of -- revenue things where boost advertising sort monetization you like what other seat? that that places

Yes.

the like of this and right. got amenity purpose to amenities one tricks other those in-flight carry for it's an is its is and is well, connectivity think basically of passenger the increase really the So airlines, -- then of to engagement whole weight

So been overall airlines. passenger -- the with idea help few but up with one with that quite monetization mechanism, that are there's others a that engagement. strategies testing is is Advertising come other we've

in approach interesting involve it. we've been And very some different services really destination-driven working things. or There's range broad them have think just some with here of and approaches promotions online savvy a -- opportunities. I think monetization of that I to with fortunate And airlines our

the of definition pretty have a airlines competitive to you're I no much same the if one every thing, by airline see think advantage. is does then things going

the their I in detail we'll -- one the on this, opportunities is of monetize a really And it's conveys. their the think biggest more they lot in-flight brand general in give operations but around I how this think values their which a that connectivity. that little and and are and brand root their use, associated partners with So they structure often it's -- of

might really operators? other great. sat of wholesale any needs And you the have comments That's on kind with

ambitions one flag working Third-party? doesn't to on ways there a carrier, of flag in third with basically be have you we've operators regional the have that is one do their carriers satellite space. and to kind things carriers, those parties also where their Especially, And been international work that of are then tied partners. of have you in governments regional and markets and main Yes. able but often which we've is local the been regional to with

into basis their flights I service space address bring where they of also on can this carriers go as for and and regions. their their they it roaming other -- carriers needs, where think go can their international think of to own more global you assets a global see can wholesale where a partnership,

issue we formula those -- maritime this very And that And the extensible of also reinforcing into helps hotspots. a also really think that industry. deal that's with it's interesting

themes underpin agreements agreements those these So of that a wholesale that mentioned. third-party are lot really partner or we

from with line Quilty Space. Your of next comes the Chris Quilty question

for I'm Shawn. Real capitalized quick the first, a interest? figures exclude CapEx assuming question

Yes.

So thanks for asking, Chris.

this include gave million. and So you was both about capitalized $XXX the number we interest, year that that do for next which year

even That's Good. better Okay. then. Great.

on question follow-up electric that quicker. direct prevent I-X doesn't from orbit them Second to you the propulsion, a if Is you Apparently, doing get got to that correct? but they've injection satellites. want

Correct. Yes.

option them launch time in -- can the orbit -- a the We vehicle. when and can keep we mission the we're service, on in have and And do they'll trade-offs But the really launch provide choosing to that's by right. of economics based that. services raising will open. We going that overall shorten need we

vendor? on and I doing I replacement you. with fairly right, got is standard? an mean, something satellite? different it's major think the to And that and Or existing add a you're existing bus an that more limb going replacement not Got or opportunity that IX as new see I of do look an out the FX, into you off-the-shelf [ technology ] this to from that

Okay.

satellites, example, L-band were Ka-band some for there that The and missions satellite. on that were an specific combined payloads. both as combined IX Inmarsat So

and combined with we're other L-band what of we So where our just are company that the assets, the portion given really payload. is looking for

commodity. it's that Inmarsat could is -- and that satellites that. -- it's we But L-band -- other and call So several for there's the -- could as use we wouldn't -- I basis different it

supported around looking to to really we are L-band services just now, in and the on the our that was our overall a aviation And did way a at that in L-band think the for best placeholder fleet overall do. by that we're safety replacement. by to -- was fulfill the fleet report migration decision which services 'XX needs cost the supported going and incur that prudent Right would fleet, are our that, strategy that's satellite our on making expanding we'll FY include but we it what was what the and with

two. question, and combination R&D line need lot rarely be a income projects. company, do it's the modems when open-ended, -- R&D a but lot harmonized can very you you. about about we But gateways terminals in between and there's as Final things terms like things of the X specific Got that a companies, talk X the look the statement a of and and you think at I of to there's of of in little products, more different

investment funded some there just R&D investments, doing to associated to the market stuff, is services Are more had period to R&D? see is you of a and you consistent which what with do individually? need X time of spend anticipated been there with companies way government products where forget of get quickly? Or the sort Or step-ups regular any the here

Guru of Right as an operational that. R&D the it's important component of now, really one the synergies -- main with themes, being described, main

in So that's of we in converging our have plan. is R&D one process networking different example of and X systems, we're and the that

networks these our We operating we also have a described number that of that improvements more efficiently.

is X%. spend, of stay in our overall we -- rough But think, X.X% to around range the to going R&D overall

government aiming some -- would that productivity customers and which that then doing. we're other think and portions. applications is similar of One are it -- on side the synergies described that's the around as for connectivity, of is enhancements, R&D be of think different the go but it big drivers. as those a we the main two then missions connectivity of [indiscernible] There's like improvements for in-flight that service And space. the of basically maritime the entertainment synthesis themes. and lot the are activities our That But in a doing -- we're types these

Deutsche Your next the Bank. Yu comes line Edison from of question with

communicate? it you Day that First, Analyst just being pushed Did is correctly I housekeeping. out? hear that Is to about the trying what were

been say that. we've you, of through Yes, on just and so that with two One, feedback had overall had taking things. reporting, disclosures we've feedback working and I'll and and many is we've This Guru. interactions

March, focus some look the means that address our earnings, next thought and the Investor like. we'll a had getting going Day are parallel which that we we So in, new of in we Investor key thinking really not would originally is what of addressing Day in we do to questions are are in the and that to

overall you call. earnings when want around But an in getting we're we disclosures next have to that and delay questions reporting, we So back key the there. didn't we'll which update come to we'll address

understand. Understand,

on couple the a business. Just

of kind away you go called the And those headwinds of were? Any on flow. headwind. as items sequentially? discrete those quantify curious way do of were a kind out can couple cash Just There a what

-- that the things mind transaction, we side. I think Shawn. this related do in Yes, we in little to we also Edison, Yes, had that U.K. had cash QX, is, to to is of payments keep flow for of one our requirements needed the kind in over and a on a the bit lift the TDL tax

interest million. in that I about our I $XX when have would quarter, kind -- we'll QX to it, I payments QX, that's think maybe So think of about

or our working capital around You probably million the so requirement, see in there. isolated $XX-ish could

have tax payments don't coming I we think don't into QX. material But any

So that's a good to about way it. think

to million years. cost. Should more just $XXX realized we maybe move think we on to trying $XXX some great. for million Inmarsat the looking upside Are more? that to time And Obviously, take forward? the last some I X dig had question, the about potentially piece. then potential you into we to we right, All as savings boosted at

the 'XX, FY million if starting what from there technology. about go-to-market look of a on headcount the $XXX talked bringing through was the and teams the lot say, would X together I way we on all Edison, so focus at you

that. really with So we good feel

supply procurement and external through Now you which chain now spend our now and related, working that. focused what the some about do, is are analysis doing are we of we on non-headcount right and think that we

So there quantified we that. savings, haven't we working those We're terms but of opportunities through do expect in yet.

And Edison, just add can point. one one -- I if my

alongside we risk that QX, were from with quarter keeping X. we the some rightsizing the saw people, mind Just that we of -- this in on in payments as announced those in

QX little bit well. that So elevated as a

to questions. the call is That we for remarks. turn I will time back closing have Dankberg Mark for all the

Okay.

We just I quarter. a like lot, joining leave X% growth. in adjusted few with would good. EBITDA new is business thanks from our everybody, a to you us. and for the revenue So winning We're XX% third generated results markets. were year-over-year targeted year-over-year important takeaways growth One growth that

targeting are we're government you in, a in hopefully, get the in way competitive and can the that enterprise think, environment mobility that of I markets. sense we specific

integration Inmarsat and balancing of The ahead innovation profitability. are budget. And of program ahead we growth, schedule is and

continued that, next I'll our And with to look operator. the forward quarter. you I hand all that, progress to updating with back it So on

Thank does call. We today's conclude conference you for joining. you. thank This

now You your may lines. disconnect