Gogo Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue was $213.2 million, a 5% decrease year-over-year and a 4% decrease quarter-over-quarter.
• Service revenue was $182.7 million, down 4% year-over-year and 4% quarter-over-quarter.
• Business aviation service revenue was $145.6 million, down 10% year-over-year and 4% quarter-over-quarter.
• Military/Government service revenue was $37.2 million, up 36% year-over-year but down 7% quarter-over-quarter.
• Equipment revenue was $30.5 million, down 9% year-over-year and 3% quarter-over-quarter.
• Net loss was $3.2 million, compared to a net loss of $1.3 million in Q3 2025.
• Diluted loss per share was $0.02, compared to $0.01 in Q3 2025.
• Adjusted EBITDA was $41.0 million, down 27% year-over-year and 24% quarter-over-quarter.
• Net cash provided by operating activities was $26.3 million, compared to a net cash used of $20.5 million in Q3 2025.
• Free Cash Flow was $28.1 million, compared to a negative $2.5 million in Q3 2025.
• Cash and cash equivalents were $90.7 million.
• Long-term debt was $814.6 million as of September 30, 2026, down from $833.6 million as of December 31, 2025.
• Deferred revenue was $30.0 million as of September 30, 2026, down from $35.2 million as of December 31, 2025.

Guidance and Future Outlook:

• Reiterated 2026 total revenue guidance of $870 million to $895 million, split approximately 84% service and 16% equipment.
• Reiterated 2026 Adjusted EBITDA guidance of $175 million to $185 million, including $18 million in ongoing litigation expense (down from $22 million in prior guidance).
• Reiterated 2026 Free Cash Flow guidance of $65 million to $85 million, including $25 million in strategic investments and updated litigation expenses.
• Reiterated 2026 net capital expenditures of $20 million, assuming $55 million in consolidated capex and $35 million in FCC reimbursement.
• Management expects recurring revenue from next-generation platforms to grow, leading to a more favorable revenue mix and greater forecasting stability.
• The company plans to flash cut customers to the new software system by the end of Q1 2027.

Business Segments and Product Lines:

• Gogo Galileo equipment shipments reached a record 172 units in Q3 2026, up 95% year-over-year and 59% quarter-over-quarter.
• Cumulative Gogo Galileo equipment shipments reached 372 units.
• Gogo Galileo Aircraft Online (AOL) reached 297 units, up 1,550% year-over-year and 61% quarter-over-quarter.
• Total ATG equipment units sold were 142, down 68% year-over-year and 52% quarter-over-quarter.
• Total ATG AOL was 5,399, down 17% year-over-year and 6% quarter-over-quarter.
• Broadband GEO AOL was 1,285, down 4% year-over-year and 2% quarter-over-quarter.
• Textron Aviation announced Gogo Galileo HDX will be a standard fit for Cessna Citation Longitude, Citation Latitude, and Citation Ascend.
• PlaneSense selected Gogo Galileo HDX for its entire fleet of 71 Pilatus PC-12 and PC-24 aircraft, with installations expected by end of 2027.
• Bombardier placed an order for 10 Gogo Galileo FDX and 15 Gogo Galileo HDX units.
• Duncan Aviation purchased 40 Gogo Galileo HDX systems, the largest single MRO order of the year.
• TransMedics contracted to equip 22 Embraer Phenom 300E aircraft with Gogo Galileo HDX, with full deployment expected by mid-2027.
• Gogo unveiled a long-term Galileo technology roadmap targeting performance enhancements every 24 months over six years, aiming for 5x download and 10x upload speeds.
• Gogo Special Missions and Insitu completed testing of a high-speed satellite solution for Group 3 uncrewed aircraft systems.

Market and Competitive Landscape:

• The FCC renewed Gogo's exclusive, nationwide air-to-ground spectrum licenses through 2036.
• Gogo received a sovereign communications lease renewal valued at over $15 million for GEO satellite connectivity to an overseas government customer.
• The company is transitioning from a domestic ATG provider to a global provider of LEO and GEO satellite connectivity for business and military/government markets.
• Utilization is shifting toward newer LEO and GEO platforms, with positive trends expected to drive growth in core markets.

Risks and Challenges:

• Total revenue declined year-over-year and quarter-over-quarter, driven by decreases in business aviation service and equipment revenue.
• Adjusted EBITDA declined 27% year-over-year.
• The company faces ongoing litigation expenses, with $4.1 million incurred in Q3 2026 and $18 million included in full-year guidance.
• Forward-looking statements carry risks including competition, reliance on key OEMs, dependence on third-party satellite providers, supply chain issues, and regulatory changes.
• The company must maintain its rights to use licensed ATG spectrum and obtain additional spectrum if needed.
• Risks include the finite useful life of satellites, cybersecurity incidents, and the ability to fully utilize deferred tax assets.

Management Commentary and Tone:

• CEO Chris Moore stated results reflect meaningful progress in the transformation from a domestic ATG provider to a global LEO/GEO provider.
• Moore highlighted the 10-year spectrum renewal as enabling growth opportunities in new markets and partnerships.
• CFO Zac Cotner noted the Term Loan B amendment provides flexibility to execute the transformation strategy while directing free cash flow toward debt reduction.
• Cotner expressed confidence that recurring revenue growth from next-generation platforms will improve revenue mix and forecasting stability.

Other Key Points:

• Gogo completed the amendment and extension of its ~$600 million Term Loan B facility, extending maturity to October 2030.
• The debt amendment commits to $75 million in principal repayments through the end of 2027, including an immediate $25 million paydown, $30 million by December 31, 2026, and $20 million by December 31, 2027.
• Inclusive of amortization, overall debt is projected to be reduced by a cumulative $92 million by the end of 2027.
• Gogo received a six-month extension from the FCC for the "Rip & Replace" network program, moving the deadline from November 8, 2026, to May 8, 2027.
• The company received $21.4 million in proceeds from the FCC Reimbursement Program for property, equipment, and intangibles during the nine months ended September 30, 2026.
• Payments on the earnout liability totaled $39.957 million during the nine months ended September 30, 2026.