Gogo Inc.

Thank you for standing by. Welcome to the Q2 2025 GoGoEarnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that this conference is being recorded. I would now like to turn the conference over to your first speaker today, Will Davis, Vice President of Investor Relations. Please go ahead.

Thank you and good morning everyone. Welcome to GoGo's second quarter 2025 earnings conference call. Joining me today to talk about our results are Chris Moore, CEO, and Zach Cotton, our CFO. Before we get started, I would like to take this opportunity to remind you that during the course of this call, we may make forward-looking statements regarding future events and the future performance of the company. We caution you to consider the risk factors that could cause actual results to differ materially from those in the forward-looking statements on this call. Those risk factors are described in our earnings release filed this morning. And a more fully detailed note under risk factors filed in our annual report on 10K and 10Q and other documents that we have filed with the SEC. In addition, please note that the date of this conference call is August 7th, 2025. Any forward-looking statements that we make today are based on assumptions of this date, and we undertake no obligation to update these statements as a result of more information or future events. During this call, we'll present both GAAP and non-GAAP financial measures. We have included a reconciliation and explanation of adjustments and other considerations of our non-GAAP measures to the most comparable GAAP measures in our second quarter earnings release. This call is being broadcast, webcasted, and available at .GogoAir.com. The earnings release is also available on the website. After management comments, we'll host a Q&A session with the financial community only. It is now my great pleasure to turn the call over to Chris.

Thanks, Willem. Good morning, everyone. We believe our Q2 performance reflects the fundamental strengths and capabilities of our business to revolutionize in-flight connectivity by leveraging our strong market position as the only independent global multi-orbit, multi-band connectivity company in aviation. With LEO, GEO, and ATG broadband, we are strongly positioned to support durable demand trends. In Q2, the business continued to show growth as demand for our GEO solutions remained strong across the global business aviation and military government mobility markets, as we see increased advanced shipments and continued rollout of GoGo Galileo's STCs. That will provide more details on our financial performance shortly, but I first want to highlight some key areas of growth and success. Starting with ATG, we reached several significant milestones in the quarter. It gives our team great pride that we announced an important industry first as we completed the initial -to-end call using the GoGo 5G chip. We now have the first 5G aircraft in hand and are progressing with the remaining development, integration, and testing that will prepare us for our expected Q4 launch this year on the already deployed and operational 5G terrestrial infrastructure. We also have positive news regarding our FCC Rip and Replace program, which now provides a $35,000 incentive for C1 installations completed before December 31, 2025. The C1 incentive enables upgrades for over 40 aircraft models to our LTE network. This funding and certification allow classic customers to seamlessly upgrade in advance of the May 2026 Classic Network Cutover. We also have significant announcements for GoGo Galileo with the two OEM wins. Embraer announced it will offer GoGo Galileo HDX as an aftermarket option for the popular Phenom 300 light jet, which has over 800 aircraft in operation. Textron also announced that the HDX will be available for aftermarket installations on Cessna Citation types once the FAA has confirmed the SDC. This is expected in late 2025. We're expected to continue delivering on the 38 HDX SDCs under contract through our dealer and OEM networks. We now have eight HDX SDCs approved, covering 10 aircraft types, with a further 30 in development. STCs for the SDX variant are in progress, with 10 SDC contracts in the works with dealers. As previously announced, we have also signed an agreement with an undisclosed OEM confirming SDX will be live for option for all its production aircraft. On the back of this good news, I'm looking forward to reviewing our strong Q2 performance. I'll cover our quarterly operating results, provide updates on our geo broadband services, and highlight realized acquisition related cost synergies. We will also review our demand potential and outline our strategic approach to capitalize on these opportunities to enhance shareholder value. I'll finish by sharing progress on key strategic initiatives. Our free cash flow exceeded our internal forecast and consensus expectations. This is driven by high growth profit due to record equipment revenue, lower operating expenses, continued synergy realization, and higher than expected adjusted EBITDA at approximately 62 million. On the revenue front, the higher than expected advanced equipment sales and higher ARPA on geo services contributed to driving revenue 3% above consensus. Though we're still seeing a gradual decline in ATG units online, we expect to see this slow and perhaps even turn around as classic customers start taking advantage of our C1 rebate program. And others decide to upgrade from classic to advanced in anticipation of our classic network cut over to LTE in May 2026. Towards that end, we set a record for ATG shipments in the quarter with 405, including 276 advanced and 129 C1 units. Shipments are strong indicator of future online activations. We also set a record 144 classic to advanced upgrades for the quarter as shipments turned into activations. We had strong performance in our HDX LEO terminals as we recognize 1.7 million of equipment revenue. Year to date, we have shipped a total of 77 units. As I stated earlier, we now have eight HDX SDCs approved, covering 10 aircraft types with a further 30 SDCs in development. We have also shipped our first three Gogo Galileo HDX units to support STC generation for mid to large business jet customers. Our geo products and aircraft online continue to grow up 41 units from Q1 with 1,321 aircraft connected to Gogo. This is up 177 units from Q2 2024, up 15%. This demonstrates the power of the OEM line fit as many of these systems are installed at the factory. We also believe it shows a predisposition of many heavy jet customers to take both LEO and geo offerings to get the capacity, redundancy and global coverage that neither LEO nor geo can provide alone. For instance, no LEO provider today can provide service in China that geo can. In Q2, we completed synchronizing our advanced and SDR routers to schedule. The router located in the aircraft are the core of in-flight connectivity systems and data management. The SDR, SDRG and advanced routers are now compatible for Gogo Galileo installation, allowing for easy upgrade opportunities for customers. This adds the approximate 2,400 aircraft equipped with SD routers to the almost 4,800 advanced installed Gogo fleet. These aircraft can now be installed with Gogo Galileo without extensive rewiring inside the aircraft. It's also worth noting that the SATCOM direct routers align fit on three aircraft models, which add several hundreds aircraft a year to that easy install fleet. Additional software and hardware harmonization for our router family are scheduled for the next two years, which will continue to improve performance for customers and lower costs for Gogo. Gogo remains the only company that can satisfy the needs of customers seeking multiple connectivity solutions from a single source. The military needs to fulfill pace, primary, alternate, contingent and emergency requirements. And global customers want assured redundancy. This gives us a significant competitive advantage in some very attractive segments of the market. We are progressing towards our synergy goals. We've completed most of the key actions to reach our now anticipated 30 to 35 million synergy cost savings. We've completed staff synergies associated with the merger, along with other actions such as the Chicago data center transition to the Melbourne, Florida site, the transition of the SD avionics manufacturing to Colorado, which is targeted to be completed by the year end. The SD Melbourne building sale is expected to be finalized by the end of August. This will offset the 15 to 20 million investment required to achieve the projected recurring synergy savings. In total, we have another 36 integration projects still underway, focused on moving to common systems and process, and we expect further cost synergies from many of these. Business aviation is currently characterized by strong OEM results, expanding fractional fleets and robust flight counts. In Q2, the five major OEMs increased aircraft deliveries 11% year on year and reported a very strong aggregate books bill of 1.3 times the trend is set to continue. And with the one big beautiful bill act signed in July, allowing businesses to deduct the full acquisition costs of eligible aircraft. We believe this positive momentum will continue into 2026. We believe this presents a significant opportunity to the increased broadband connectivity and installations and a major opportunity for go go. This sector remains buoyant with recent announcements confirming strong market growth. Fractional ownership operator flex jet announced an investment of 800 million. The company has indicated that much of it will be spent on improving passenger experience, much of which relies on connectivity. In addition, Bombardier recently announced a new fleet order for 50 aircraft with an option for a further 70 presenting a considerable opportunity for go go. This trend indicates more business aircraft will be entering the global fleet than leaving and more hours being flown. As a result, demand for connectivity should continue to increase. International governments are seeking alternative satellite suppliers, which provides an opportunity for go go and our multi network approach. The French government has already strengthened one web competitive position by becoming you tell stats largest shareholder following a 1.55 billion capital commitments. This will support continued one web network investments. At one was only connectivity service partner for business aviation. We believe this strengthens our position to respond to growing demand and maximize our global office expansion. In summary, we see demand for quality in flight connectivity in both business aviation and military government mobility verticals surging while overall penetration remains extremely low. Only 9700 or 24% of roughly 41,000 global business aircraft, which have broadband connectivity today. Go go strategy for value creation is to grow our share of a highly unpenetrated market by strengthening existing and creating new long term high margin recurring revenue customer relationships. We plan to do this. By first delivering the many new products I've just described that significantly improved performance over traditional in flight connectivity products. Second, engineering equipment that is purpose built for our market and easy to install maintain and upgrade than competitive products. Third, expanding our addressable market by utilizing the broad product offering and global footprint facilitated by this SD go go merger to satisfy the needs of all segments of our vertical markets. For leveraging our significant presence in those markets to attract the best technology distribution and network partners on the best terms to serve our customers and finally provide the world class customers support that our customers demand. This strategy underpins our approach to multi network open architecture platforms and enables broad mission coverage across both business aviation and military government markets. That flexibility is core to our future proofed hardware design strategy that can support multiple bearers with network agnostic modular terminals, such as our plain simple geo and go go Leo antenna portfolio. With the upcoming launch of multiple K a ban Leo networks, go go can leverage our terminal network architecture. So remain agnostic about our customers enabling the latest developments from satellite providers on any aircraft type. Our expanding global support network is a key part of the distribution partners. Part of this strategy. We now have a hundred and forty eight dealers across 233 locations. These dealers are invested in STC generation ongoing customers for another representatives across the globe acts as a force multiplier to our sales efforts. Now I'd like to share a few updates on the progress we are making towards some of the efforts that support this strategy. Since the start of operations in April, our Leo utel sat one web customers have used over 1200 hours. HGX is ideal for the 12000 midsize and smaller aircraft that fly outside of North America and have no broadband solution today. An aircraft among the 11000 midsize and smaller North American registered aircraft that often fly regionally outside corners or one faster mean speed than 5G alone can provide. The FDX terminal is designed for the 9700 larger business aircraft operators, many of which fly into the continental missions as well as our VVIP and government clients. We are off to a strong start for Galileo. Our early customers are positive about the HGX performance and we have more than 500 plus immediate opportunities for HGX in our sales pipeline. 40% of these are overseas and we are seeing strong interest from international operators. We've already signed our first multi aircraft deal with a Middle East charter operator. As I mentioned at the start, we've made a crucial step towards forward in terms of our 5G product, which is targeted at large segments of the North American midsize and smaller market. They want a good connectivity experience but are lower cost than satellite products. Our chipset supply successfully completed the first end to end call using the GoGo 5G chip in June. The chip is now in the final phase of testing at our Broomfield and Chicago facilities. Following the integration into the Advanced LX5, flight testing is anticipated to commence in September and to go live by year end. It is worth noting that we have already made a bulk chip purchase to ensure supply for our customers when ready. More than 300 aircraft are now pre-provisioned for launch. The 5G tower network is complete with 170 installed across the US and southern Canada. GoGo has already received FAA approval to produce and manufacture the Advanced LX5-LIU and 25 STCs for the new antenna covering 8,500 aircraft. The new 5G core is installed in our data center. Our next generation LTE network deployment is also underway. The first LTE tower antenna has been installed and we are beginning network build out in anticipation for the cut over. Supporting the transition, we announced a multiple aircraft type STC for the GoGo C1 unit. This covers 42 aircraft representing 70% of the installed GoGo Classic fleet. We have already shipped 234 units for customers. As mentioned previously, the FCC Rip and Replace program now provides incentives to C1 installations, assisting customers with the replacement of the old GoGo Classic installs. The C1 LTE box has the same form factor as the old Classic product, allowing for a very fast unit swap. But it has dual EVDO and LTE air cards. This enables a seamless network cut over. For customers lacking the time or budget for an advance upgrade before the May 2026 transition, this solution enables a cost effective option. It keeps our customers connected and preserves GoGo's service revenue from this market segment. We are urging customers to commit before year end to take advantage of the FCC rebate and be ready for the cut over. In the MilGov vertical, we see an opportunity for GoGo solutions to be integrated with SD's geo offerings. Our current revenue mix in this segment includes a significant portion of legacy narrowband services, which are expected to decline gradually over the next several years. However, we anticipate broadband growth in the MilGov sector will materially outplace the decline in narrowband as the segment transitions to broadband solutions. Today, almost all MilGov mobility aircraft still rely heavily on voice over radio and narrowband for communications, which is limited in bandwidth. There is a significant effort underway to upgrade to new broadband satellite technologies. The U.S. Air Force 25 by 25 program aims to equip 25% of its 1,100 mobility aircraft with satellite communications by the end of 2025. This still leaves 75% of the fleet without satellite connectivity, which the Air Force believes must be addressed, presenting a substantial opportunity for growth. We believe GoGo's Leo product will be an excellent complement to our geo products in this market due to the DOD's PACE protocol, which requires military programs to have primary, alternate, contingent, and emergency systems. With the support of the government funding, GoGo is also leveraging our SD Pro operating system, which enables monitoring and utilization of PACE. We also see the opportunity for 5G -to-ground as a possible new alternative for redundancy. While there have been some delays in awards, the general trend towards better communication systems for aircraft aligns with the U.S. administration's broader goal for modernizing the military. We've also added a key resource to the GoGo board of directors with the recent appointment of retired General Mike Minahan. Finally, I'll touch briefly on tariffs. We have made provision, and while our decisions remain fluid, we believe that as trade deals currently stand, there is minimal impact on aviation, and our exposure is much reduced. In conclusion, we are pleased that our strategic investments are now being delivered. We are uniquely positioned to capitalize on the increased demand of inflight connectivity, as our multi-orbit, multi-band approach gives the business a competitive edge. We feel very positive about the merger process. So far, we are achieving the cost, product, and commercial synergies we wanted to accomplish with the SD GoGo combination. We expect to produce compelling financial results in 2026, driven by growth in service revenue from our new products, a significant reduction in product program spends, the full year impact of synergies made in 2025, and full funding of our FCC Rip and Replace program. And now I will hand over to Zach to talk about the numbers.