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During the quarter, we resolved the GX dispute with Inmarsat. In case you missed the news, at the end of June we agreed to settle the matter associated with this early 2014 contract between the companies by agreeing to pay $50.75 million or the approximate value of the interim arbitration award. We paid $45 million at the end of June, $5 million at the beginning of July and the final $750,000 is due mid next year.

We spoke about our rationale in agreeing to settle. But, briefly, as preparations for the Phase II hearing progressed and we looked at Inmarsat's counterclaims to our own counterclaims, it was a potential scenario where the arbitration panel, which had delivered a very surprising and disappointing ruling in Phase 1, could have given us an equally bad ruling in Phase II, driving up the cost of an award to include interest, attorneys fees and other amounts claimed by Inmarsat. By settling for the interim award amount, we felt we were able to get value for our counterclaims by eliminating interest and attorneys fees, and capping any further downside. It was not the outcome we had hoped for, but it is an outcome that lets us move on.

With that behind us, I'd like to take some time to remind you how much progress we've made in transforming the Company. Three years ago RigNet was really just a remote managed communication services company operating in a deteriorating offshore drilling environment where its major customers were stacking rigs at an unprecedented rate. In this difficult industry environment and with an abundance of new satellite capacity continuing to come online, we faced significant price pressure from our customers but sometimes out ran the cost benefits we were able to recognize as satellite bandwidth prices decreased.

We also had a small Systems Integration business. As you may recall, we took more than $15 million writedown in that business in late 2015 due to poor project management on one large project. So, we had a number of priorities when I arrived a little more than three years ago. They were, one, to fix the core business; two, to scale the core; and three, to expand our offerings and our addressable market through the development of over-the-top solutions. I think we've made great progress across all three of those areas and want to remind you of some of the highlights.

In terms of fixing the core, we focused on improving our fundamentals, our relationships with customers and our service offerings, including our issue response through our global network operations center. We've streamlined the business internally, deploying best practices across the Company. Three years ago, the Company was pretty siloed in terms of its operations and internal communications. Today, we work as one team with a common set of overarching goals along with specific department goals, all of which are focused on delivering value to our shareholders. We've invested in operational support systems that integrate our global support teams through the use of a single common global software platform. We've been able to take advantage of structural declines in satellite bandwidth pricing to maintain and, in some cases, expand our margins. And we've dramatically improved our proactive customer care and issue resolution protocols over the last several years to differentiate RigNet from competitors in terms of our service offerings.

Constant and proactive customer care is one of our key differentiators. Finally, we fixed the SI or System Integration business by bringing in new leadership, professional sales and project management and we're able to turn that business into one which is routinely meeting and exceeding both our and our customers' expectations. In the last three years in that business, revenue has doubled, gross margins have doubled, backlog has doubled, all while taking less contract risk than in the past.

In terms of our second goal, we've expanded our core business. Over the past two years we've done acquisitions which have helped us build scale in the base business, because, as I've said many times, networks benefit from scale. It's a key element in realizing cost savings. RigNet added network scale in the MCS or Managed Communications Services business through the acquisitions of DTS and Auto-Comm. And we've grown sites organically, offshore, on land, in maritime and in production.

Last quarter, I mentioned that we had won four FPSOs with Petrobras in Brazil, and that these will be getting turned on later this year. I'm excited to tell you that we've won yet another six FPSOs in Brazil since our last call. These are large, complicated vessels with significant bandwidth requirements. And they represent a new area of expansion for us in the energy value chain.

I'm even more pleased to announce that we have concluded an exclusive long-term multi-year agreement to provide managed communication for Valaris, formerly EnscoRowan. RigNet was a provider to both Ensco and Rowan prior to their combination. But this cements our future relationship in a deal which both sides are very pleased with. We'll be providing more bandwidth to the combined fleet, while protecting margins and opening the doors for additional opportunities in machine learning and cybersecurity.

We've also expanded our business in the Middle East, a significant and growing area of activity for our oil and gas customers, and built the first 4G LTE and 5G-enabled network in the Gulf of Mexico that's backed by a major US telecom partner, T-Mobile.

Going back to our SI business, we've improved and grown that business both organically and through the acquisitions of SAFCON and Auto-Comm. Starting in the first quarter of this year, we launched our government services initiative where we're seeing a lot of interest, particularly in our cybersecurity-related products and services.

In terms of our third goal, we recognized several years ago that to thrive in the Managed Communications Services business, we needed to differentiate ourselves by moving up the stack. So we created a new segment, Apps and IoT. And while our own internal development of applications, including AVI, complete connect and our crew welfare suite have been successful, we made a number of acquisitions that have really launched us in exciting new directions.

ESS added a strong IoT business. We currently provide service to over 10,000 IoT SCADA sites largely associated with oil and gas midstream, and we continue to work on growing that business. In May, EchoStar and RigNet announced that our companies are partnering to roll out equipment and services in Europe using S-band spectrum to increase options for customers fix and mobile data solutions. We think this is a really exciting opportunity.

Our two key acquisitions in the Apps & IoT segment had been Cyphre, our hardware-based cybersecurity product that's proven to be a platform for the development of broad cyber security portfolio, and Intelie, our real-time machine learning and AI solution that's rapidly gaining ground as the go-to-solution for live data acquisition and analysis. We just announced a multi-year agreement with Transocean to provide Intelie for real-time mission-critical data analysis under offshore fleet. Intelie is the fastest to implement and most efficient solution available, enabling our customers to rapidly realize the benefits of their digital transformation efforts, where other solutions can take years to implement and can fail to deliver results. In the case of Transocean and other customers, we've been able to introduce Intelie, successfully complete a proof-of-value trial and execute the development work required to roll out the solution, meeting customers expectations and deployment milestones. As we've said in the past, Intelie has gained traction with offshore drilling contractors, global supermajors and offshore fracking -- excuse me, onshore fracking companies, demonstrating velocity, versatility and value.

Cyphre has been a little slower on the uptake, but it forms a key element of our cybersecurity solution set, which is gaining traction because of the increasing number and sophistication of cyber attacks on our customers' networks. It has significant growth potential.

Finally, we've been able to create what we've called a Flywheel Effect, where business in one segment is creating follow-on opportunities in other business segments. A great example is with the large system integration customer, where we've introduced Intelie in combination with CertifiedSafety to create a real-time workforce tracking system that's getting very positive reviews. As the project [Indecipherable] up, the recurring revenue for this solution will be reported in Apps and IoT. Another example is our newly introduced Live-IT solution, where the introduction of Intelie actually created an opportunity for us to help our customers manage the data systems that feed Intelie's real-time machine learning based AI. Live-IT is a new IT-as-a-Service that will ensure customers rapidly realize optimal value from their digital transformation investments.

In the last three years, RigNet has come a long way. We used to be considered an oilfield services company, predominantly focused on delivering communications on offshore drilling rigs. Today, we're a global technology company with some of the most advanced, real-time AI and cybersecurity products on the planet, combined with an efficient, ultra-secure network that in combination enables digitalization across the energy value chain, including upstream, midstream and downstream. With GX behind us, we are excited to return our focus to this ongoing successful transformation. With a strong market position in Managed Communications Services, a large owned network infrastructure in the Gulf of Mexico, a Systems Integration capability that's performing well, a rapidly growing real-time machine learning business with a long list of premier brands in energy and in other sectors, and a best-in-class cybersecurity portfolio, we feel the some of the parts valuation deserves a much closer look. These businesses feed one another that is truly differentiated, we're looking across the technology sector.

With that, let me turn it over to Lee.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Thanks, Steve. Recapping what Steve said earlier, consolidated quarterly revenue was $60.3 million, up 4.9% compared to $57.5 million in the prior quarter. Revenue was up by 0.5% from $60 million in the second quarter of 2018. The increase compared to the second quarter 2018 was primarily due to Apps and IOT. The increase compared to the prior quarter was due primarily to SI. And I'll touch on the segments in a moment.

GAAP net loss attributable to common stockholders in the second quarter 2019 was $6.2 million or $0.32 per share compared to a net loss of $12 million or $0.63 per share in the prior quarter and a net loss of $4.3 million or $0.23 per share in the second quarter 2018. Adjusted EBITDA was $9.8 million in the second quarter of 2019, a 16.6% increase compared to $8.4 million in the prior quarter and a 20.7% increase compared to $8.1 million in the second quarter of 2018.

Now let's touch on the segments. Managed Communications Services revenue was $41.2 million for the quarter compared to $42.3 million in the prior quarter and $41.7 million in the prior year quarter. Gross margin in the second quarter of 2019 was 39.3% versus 36.3% in the first quarter of '19 and 39.3% in the second quarter of '18. The decrease in Managed Communications Services revenue and increase in gross margin compared to the prior quarter was due to the prior quarter having higher equipment resale revenue. Also, the T-Mobile LTE build out was substantially completed in second quarter, so there was a decrease in revenue associated with that project.

Our MCS Site count for the second quarter was 1,384, up by 87 year-over-year and up by 24 sites sequentially compared to the first quarter. As we discussed on our last call, we've seen some recovery in site count since year-end driven by the production, maritime and other site count categories. This quarter, we gained six offshore rigs, while several of the fleets we serve had some cold stacking and scrapping. As a result, we were down a net of three offshore drilling rigs in the site count. However, though the overall number of offshore rig sites was down slightly, the monthly recurring revenue of the six sites we added more than offset the sites where service ended.

Apps & IoT revenue was $8 million for the quarter, up 21.7% compared to $6.6 million in the prior year quarter and flat at $8 million sequentially. The increase from the prior year quarter was largely the result of Intelie ramping up. Sequentially, revenue in the segment was, as I said, flat. That's largely because we were doing some significant development work for our customers during the second quarter with a focus on hitting milestones, which allows us to increase billings in 3Q and beyond.

For example, Transocean turned up new services after the end of the quarter, and our first fracking customer turned on new services and turned up additional sites late in the second quarter, meaning the revenue contributions from these successes will not be seen until the third quarter. So in summary, we expect to continue to see Intelie's contribution increase throughout the remainder of the year as current customer revenue ramps and new customers are brought on.

Systems Integration revenue for the quarter was $11.1 million, up 55.3% from $7.2 million in the prior quarter, but down from $11.7 million in the prior year quarter. Gross margin for SI increased to 36% from 30.6% in the prior quarter, and from 33.7% in the prior year quarter. The revenue increase compared to the prior quarter was due to the variable nature of the business, with several new projects ramping up and savings being recognized on several projects nearing completion, which also benefited gross margin. Project backlog remained strong at $37.1 million as of 06/30/19, up $17.5 million or 89.1% from second quarter 2018's total of $19.6 million, but down $5.9 million as of 03/31/19 due to work off.

Unless you become concerned that we've seen a decrease in the backlog, remember that just like recognizing revenue on individual projects can be uneven, the pace of bidding for these opportunities also ebbs and flows. As well, in the EPC business, there's often a gap which is sometimes considerable as clarifications and changes to bids are submitted between the initial bid and the final project award. All of that to say that we are responding to a significant number of opportunities. In fact, to put some numbers around it, we received 34 opportunities to bid in the second quarter of 2019. That's up from 22 in 1Q '19 and 20 in 2Q '18. Now, we don't respond to every opportunity, some just aren't the right fit for what we do and we do have limited resources, but these figures should give you an idea that the SI business is healthy.

SG&A expenses totaled $17.4 million in 2Q '19 compared to $20.3 million in 1Q '19 and $17 million in 2Q '18. The decrease compared to prior quarter is primarily due to the prior quarter having elevated stock-based compensation under our 2018 short-term incentive plan. SG&A for 2Q '19 included $2.2 million of GX dispute Phase II legal costs compared to $2.2 million in 1Q '19 and $0.8 million of GX costs in 2Q '18. We also recorded a $1.3 million increase in the fair value of the Intelie earn out and contingent consideration. This is actually a positive indication of how well Intelie continues to perform.

Capital expenditures were $4.6 million compared to $7.1 million in the first quarter and compared to $6.6 million in the prior year quarter. Capex spend for the quarter included a total of $1 million for the build out of the new Lafayette, Louisiana facility that will enable us to consolidate three separate legacy facilities and $0.5 million for the build out of the LTE network with our partner, T-Mobile. We expect to complete the final few sites associated with the Gulf of Mexico LTE network, which is already carrying live traffic, in the coming months. The remaining $3.1 million of capex was substantially composed of success-based commitments.

Finally, let's turn to the balance sheet. As of June 30, 2019, cash was $10.9 million; our outstanding debt was $111.1 million, including both current and long term. And with that, I'll turn it back over to Steve.

Steven E. Pickett -- Chief Executive Officer and President

Thanks, Lee. Before we open it up for questions, I want to thank the team at RigNet for their dedication and for their determination to drive results for our customers and investors. Our more than 600 employees executing for our customers in over 50 countries are critical to our success. And I recognize and appreciate their professionalism and their tireless efforts.

Lee, with that, let's open the line for questions.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

All right. Jerome, let's open the queue, please.

Questions and Answers:

Operator

[Operator Instructions] All right. Your first question comes from the line of Allen Klee with Maxim Group. He will now live.

Allen Klee -- Maxim Group -- Analyst

Yes, good morning. In your Managed Communications Services segment, can -- you talked about a couple of wins and it seems like you're adding in areas outside of offshore. Could -- can we get a sense of adding this all together of -- maybe starting off with the status of Noble in terms of how many rigs rolled off and how many are left? And then of the couple of wins that you mentioned in the segment, if we added that all together, does this imply that we could think about this segment as growing sequentially in -- possibly in 3Q and 4Q? Thank you.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Hey, Allen, good question. Good morning. This is Lee. Let me just answer your question with respect to Noble. We just had, I believe, one of the Noble rigs roll off during the quarter. We still have three rigs on contract, and it looks like those are expected to stay on contract with us through the end of the year. So that's a positive for us. I think, if you look at the rig sector, it continues to struggle. I think there is still some optimism from the offshore drilling contractors as you look at what we think will happen in 2020.

So I would like to tell you that I think that we can see the overall market continue to grow there as more rigs go back to work. But as you obviously know given the situation with China, the trade war, Iran, all of these things create a lot of uncertainty and I don't think we're seeing offshore operators make big bold moves in putting large sets of drilling rigs back to work. So what we're focused on is really continuing to provide excellent service to our existing customers, assist them as they pursue their own new opportunities in various basins around the world, and then look for opportunities to leverage Intelie and our other offerings in a way which might allow us to increase our market share of the segment. Steve?

Steven E. Pickett -- Chief Executive Officer and President

to add to that. Clearly, our complete set of capabilities today give us an opportunity to capture a larger wallet share. And so that's what we're continuing to focus on. It's not just offshore anymore in terms of our Managed Comms business. As you know, we also have a growing production-related business and the growing midstream business. And we're looking to provide solutions that aren't just solutions that deliver comps to remote areas, but instead enterprisewide solutions that provide things like the best-in-class cybersecurity protection and real-time machine learning wherever our customers might be operating.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Yes. So I think the announcement of the Valaris contract renewal this morning here on the call is obviously a significant win for us, especially given some of the chatter that was out there in the market that's creating some fear and uncertainty around that. I think that we have an opportunity to continue to build on the foundation of that relationship and also expand it with the other opportunities that we have, but I believe that one of the reasons that they chose to renew with us was, as Steve mentioned, the proactive customer care that we do and the relationship that we build through our network operating centers over-the-top [Phonetic] and ensuring that we are responsive to their needs and issues and keep them up and running with the best service they could possibly get. It's not just about price.

Allen Klee -- Maxim Group -- Analyst

Thank you. And then the Gulf of network -- Gulf of Mexico network that you -- have 4G, 5G that you've closed to being finished building out. Is there a way to think about the potential revenue contribution in 2020 that this could could generate?

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

It's a great question, Allen. And frankly, one that we actually are working ourselves internally to try and understand. Remember the dynamic. The dynamic was we spent the capital upfront, T-Mobile pays us for every site that we turn back on. Then once the network is carrying traffic and generating roaming revenue on the network, T-Mobile takes that revenue to recover its payments to us. So basically 100% of that initial roaming revenue goes back to T-Mobile, so that we are kept hold in the capital expenditure department. They are then made whole and then we start on the 50-50 revenue sharing agreement. And we believe that will start sometime in 2020. But I think it's very early on in terms of determining how much traffic and how much revenue that's going to generate.

Steven E. Pickett -- Chief Executive Officer and President

And, of course, it's a very unique network. It's a network that covers an area about the size of the State of Georgia over water in the Gulf of Mexico. And there aren't that many comparisons to use to determine what to expect in terms of the roaming traffic offshore. And, by the way, we're really excited about having this project essentially complete. A couple of more platforms yet to go, but essentially complete. It's carrying traffic. And what we're really excited about is something that's very special about this network and that is the frequencies in which it operates. Both 600 megahertz and 700 megahertz that penetrate these big metal offshore assets much more effectively than higher frequency solutions. So, anyway, really pleased that we have the bulk of this build behind us and that is certainly makes it the most contemporary network out there.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

And we're continuing to have conversations with them about opportunities to expand the network.

Allen Klee -- Maxim Group -- Analyst

Thank you. And then moving on to Apps and IoT. You spoke about that you have a couple of projects that are going to start to contribute in next quarter. Is there a way for us to think about what that can mean in terms of the magnitude of increases in revenue?

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Well, we don't give you guidance, Allen. But there is a significant contribution that we're expecting to come as we ramp up, what we're doing for transition as well as for our fracking customers. So I'm afraid I can't really give you much more than that, certainly in terms of numbers.

Allen Klee -- Maxim Group -- Analyst

OK. And then...

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

I guess I would also tell you that we've got a number of customers that I think are in, I would call, the late stages of their proof of value trials where we expect to convert those to contracts as well and again begin ramping those up.

Allen Klee -- Maxim Group -- Analyst

Okay, thank you. My last question is in within Systems Integration. You talked about in prior calls that the seasonality we should think about is I think that growth in 2Q and then 3Q sequentially, and then a decline in 4Q. Is that still how you are kind of thinking about how it plays out across the year?

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Yes, I think in general, that's correct. I think we talked about it in the past as being somewhat camel shaped with the hump in 2Q and 3Q. But I think we may have less of a fall off in 4Q, just based on what we're seeing right now.

Allen Klee -- Maxim Group -- Analyst

And does that camel shape -- does that camel shape mean that 3Q is higher than 2Q?

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

You know I'm not going to answer that question for you.

Allen Klee -- Maxim Group -- Analyst

Okay. All right, thank you so much.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

You're welcome.

Steven E. Pickett -- Chief Executive Officer and President

Thank you, Allen.

Operator

[Operator Instructions] Now we have follow-up question from Allen Klee with Maxim Group.

Allen Klee -- Maxim Group -- Analyst

Yes. Hi. I wanted to -- but since I'm the only one, I'll keep coming. I noticed, you had -- it looked like a good reduction in your accounts receivable this quarter and I know you've had a focus on improving collection. So it looks like we saw that. And any comments on the actions there and how you're thinking about this?

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Well, I hope that my AR team is listening right now also have heard you, and notice that mentioned it, because they have just done yeoman's work this quarter in working with our customers. And it's not just AR, it's been a great team effort. Steve mentioned, we're working in a way that's much less siloed today than we used to. And so sales and operations and the order fulfillment team everybody has come together. It's a really put a focus on bringing collections and the AR number down. So very, very pleased with performance. We continue to have that as a focus area and are working to bring more cash in the door every day. So thanks for noticing.

Steven E. Pickett -- Chief Executive Officer and President

Yes. And to maybe add to that, we're also looking at where we can improve processes with customers in order to make this a more consistent result for the business and for our investors.

Allen Klee -- Maxim Group -- Analyst

Okay. And then maybe my last question would be, you talked about during your presentation that the value of the some of the parts of the Company. I was wondering if maybe -- if we could get your expansion on that in terms of maybe how -- what investors might be missing in or -- in some of the segments that you have?

Steven E. Pickett -- Chief Executive Officer and President

Yes. I think there were a number of comps that you can look at when you kind of dissect the different areas of RigNet's business. I think you can look at how real-time machine learning businesses are trading. Typically those trade is a multiple of revenue. The same is often true for cybersecurity businesses that trade at -- oftentimes, trade at a multiple of revenue. And in our offshore-owned infrastructure, we think has meaningful -- really meaningful value. And on top of that there is still a remote satellite based Managed Comms business that's performing well in a market that's generally will be moving sideways.

Lee, do you want to add anything to that?

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Yes. Allen, when you look at it, we're trading today in a difficult market at about -- well, slightly below $150 million in market cap. That's below the Managed Comms revenue from 2018. So not only are we trading less than one times revenue for one segment, that's giving absolutely no credit to any of the rest of the business, particularly the Apps and IoT business, which we expect is going to be the growth driver of the Company really going forward. And in SI business, that's just delivering a great projects in great margins. So if -- it's a little, I think, frustrating for the management team, it's little frustrating for the Board to see the equity behavior moving as it is, because there are so many good things going on right now and I think that's really one of the reasons why Steve chose to sort of reset the stage and help people remember what RigNet was and really what we've done with the Company over the last several years. And now that we've put GX behind us, we're really poised to be able to focus on that growth.

Steven E. Pickett -- Chief Executive Officer and President

It really build on the momentum that we have, because, as I said in the press release, we're really hitting on all cylinders as it relates to the three segments of our business. So we are very pleased with it. We're going into this call, we have a very important contract extension with our largest Managed Communications Services customer, Valaris, a big win in the area of real-time machine learning with Transocean, nice growth, as we talked about, in Managed Communications Services out of Brazil and -- so anyway, we're really pleased with how the business is performing. And I think over time that will be rewarded.

Allen Klee -- Maxim Group -- Analyst

Okay, thank you. Well, you beat my numbers on revenue and EBITDA. So good quarter. Thank you very much.

Steven E. Pickett -- Chief Executive Officer and President

All right. Thanks, Allen.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Thank you, Allen.

Operator

[Operator Instructions] I'm showing no further questions at this time. I would now like to turn the conference back to Lee Ahlstrom.

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

All right. Thanks, Jerome, and thank you for joining us today on our second quarter earnings call. We'll be available here in the office if you have any follow-up questions that weren't addressed today and we certainly invite you to join us in November when we expect to report our third quarter 2019 earnings. Have a good day.

Operator

[Operator Closing Remarks].

Duration: 40 minutes

Call participants:

Lee M. Ahlstrom -- Senior Vice President and Chief Financial Officer

Steven E. Pickett -- Chief Executive Officer and President

Allen Klee -- Maxim Group -- Analyst

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