Iridium has announced financial results for the third quarter of 2020, reporting that net loss was $4.0 million, as compared to net loss of $18.0 million for the third quarter of 2019, which is attributable to the lower net interest expenses related to the refinancing of Iridium's credit facility and high-yield notes from the year ago period.
"Iridium's business model has proven quite resilient given the importance of our services in the face of a global pandemic," said Matt Desch, CEO of Iridium and 2020 Wash100 Award recipient. "Iridium delivered a record 67,000 net subscriber additions during the quarter, which drove sequential growth in commercial services. Subscriber equipment sales also increased by 18% year-over-year, driven by increased demand in the third quarter."
Iridium noted the company’s growth was attributable to service revenue and lower selling, general and administrative expenses. Operational EBITDA for the third quarter was $93.4 million, as compared to $88.5 million for the prior-year period, increasing 6 percent. The OEBITDA margin was 62 percent. OEBITDA benefited from increased commercial revenue and reduced operating expenses.
Iridium reported third-quarter total revenue of $151.5 million, including $116.9 million of service revenue and $34.6 million of revenue related to equipment sales and engineering and support projects.
The company’s total revenue increased by five percent versus the comparable period of 2019, while service revenue grew by one percent. Service revenue was 77 percent of total revenue for the third quarter of 2020.
Iridium ended the quarter with 1.429 million total billable subscribers, compared to 1.3 million for the year-ago period. Subscriber growth was driven by rising activations of personal communications devices. Total billable subscribers grew 13 percent year-over-year, driven by growth in commercial IoT customers.
"In light of continued momentum, Iridium is raising its full-year guidance for 2020. We now expect to generate approximately $355 million in operational EBITDA and finish the year with net leverage of approximately 4.0 times operational EBITDA. With nearly a full turn of deleveraging in 2020, we are well on our way to achieving our targeted leverage range and undertaking material returns of capital to shareholders," Desch added.