In This Article:
-
Revenue: Declined year over year to $25.4 million, primarily due to lower VSAT airtime service revenue.
-
Gross Margin: Airtime gross margin increased to 31.5% from 28.2% in the prior quarter.
-
Adjusted EBITDA: $1 million for the quarter.
-
Capital Expenditures: $1.1 million for the quarter.
-
Free Cash Flow: Adjusted EBITDA less CapEx was negative $0.1 million.
-
Cash Balance: Ending cash balance of $48.6 million, down approximately $2 million from the beginning of the quarter.
-
Subscriber Growth: Increased subscribing vessels by 5% to over 7,400.
-
Product Shipments: Connectivity terminals shipments exceeded 1,300 units, marking the fifth consecutive record quarter.
-
Operating Expenses: $9.7 million, 5% higher than the prior quarter, but 19% lower than the first quarter of 2024.
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
KVH Industries Inc (NASDAQ:KVHI) achieved a 5% increase in their subscriber base, recovering from previous declines.
-
The company reported a 3% increase in airtime gross margin, driven by strong contributions from Starlink.
-
KVH Industries Inc (NASDAQ:KVHI) set a record with over 1,300 connectivity terminal shipments, marking the fifth consecutive record quarter.
-
The introduction of the Commbox Edge Secure Suite enhances cybersecurity for vessel communications, leveraging advanced technologies like Cisco Talos and Cisco Snort.
-
KVH Industries Inc (NASDAQ:KVHI) successfully added OneWeb terminals to their product portfolio, expanding their service offerings.
Negative Points
-
Revenue declined year over year to $25.4 million, primarily due to the loss of US Coast Guard revenue.
-
Operating expenses increased by 5% compared to the prior quarter, totaling $9.7 million.
-
The company experienced a $2 million decrease in cash balance due to working capital movements.
-
Product gross profit was break-even, indicating challenges in maintaining profitability in hardware shipments.
-
The potential impact of tariffs remains uncertain, posing a risk to future cost structures.
Q & A Highlights
Q: Can you break down the LEO margins into airtime versus additional services? A: The majority of the margin comes from the actual airtime. The add-ons, such as warranty or cyber services, have similar margins to other business areas, but the strong margins primarily refer to the LEO bandwidth itself. - Anthony Pike, CFO
Q: Are the current SpaceX plans optimized for your customers, or do you anticipate changes? A: The current plans are well optimized, but Starlink has introduced a terminal access charge. We will also implement a similar charge later this year as we renegotiate our Starlink agreements. - Brent Bruun, CEO