Iridium Communications (Nasdaq: IRDM) has released its financial results for the third quarter of 2023 and provided an update on its outlook for the full year. The quarter’s highlight was the 12 percent year-over-year increase in operational EBITDA to $121.3 million, a new record for the global voice and data satellite communications provider.
The company said Thursday that total revenue for the quarter reached $197.6 million, and 63.5 percent or $125.5 million came from commercial service.
“Iridium continues to enjoy strong subscriber momentum and broad-based revenue growth across its commercial business lines, which drove record operational EBITDA,” said Matt Desch, Iridium CEO and nine-time Wash 100 awardee. “We are generating exceptional cash flow, which should continue well into the future as we projected at our recent Investor Day in September.”
For Iridium’s U.S. government service, its revenue for the quarter is $26.5 million. The figure reflects the contractual rate in the Enhanced Mobile Satellite Services contract, which is a seven-year, $738.5 million deal with the U.S. Space Force for specified satellite airtime services.
The company incurred a net loss of $1.6 million compared to the net income of $2.1 million in the third quarter of 2023 due to costs related to the successful refinancing of Iridium’s credit facility. Besides the reduction in interest rate, the maturity date was extended to September 2030. The refinancing costs fully offset the strong revenue growth in commercial service lines and higher revenue in engineering and support.
Desch said during Investor Day that he expects Iridium to generate about $1 billion in annual service revenue by 2030. It will also have the capacity to generate approximately $3 billion in shareholder returns during these seven years.
For the full-year 2023 guidance, Iridium expects service revenue to grow by approximately 10 percent and operational EBITDA to be between $460 million and $465 million for the year. However, SG&A would be 20 percent higher than in 2022.