Bajadock: ViaSat sells Exede Satellite internet services for residential and business customers
Satellite broadband provider ViaSat on Tuesday reported higher revenue but lower profits for its fourth quarter as it ramped up spending for the next generation of broadband satellite technology.
The Carlsbad company, which supplies high-speed Wi-Fi for JetBlue, Virgin America and other airlines, saw fourth-quarter sales rise 2 percent over the prior year to $372 million.
Net income dipped to $4.5 million, or 9 cents a share, under generally accepted accounting principles. That’s down from $7.5 million a year earlier.
Excluding certain expenses such as depreciation, the company earned 29 cents per share. Wall Street analysts had been expecting earnings excluding charges of 37 cents a share on revenue of $370 million.
The earnings decline stemmed from increased research and development investment for the company’s next generation of broadband satellites, which will give ViaSat a global footprint for satellite Internet service.
For its full fiscal year, ViaSat’s sales rose 2.5 percent to $1.4 billion. Net income came in at $21.7 million, or 44 cents per share, compared with $40.4 million the prior year.
ViaSat’s 2014 results were boosted by nearly $54 million paid by Space Systems Loral for infringing on ViaSat’s patents. Last year, Loral’s payment to ViaSat shrunk to $27.5 million.
The company has 697,000 home and business Internet subscribers in the U.S., where its ViaSat-1 satellite, launched in 2011, is reaching capacity.
ViaSat-2 is slated to launch early next year — expanding the company’s bandwidth and market area across the Atlantic and into the Caribbean, Mexico and elsewhere.
“The launch is scheduled for a window seven months from now,” said Chief Executive Mark Dankberg. “We expect to be able to grow our addressable market by offering plans with even higher speeds and virtually unlimited bandwidth with no usage caps.”
The company has begun investing in the next generation of ViaSat-3 class satellites — which will provide even more bandwidth globally from three new satellites slated to launch virtually back to back starting in 2019.
In addition to home Internet, ViaSat has become a key supplier of in-flight Wi-Fi to JetBlue, United Airlines and Virgin America. Nearly 500 aircraft use its technology today, which is fast enough for passengers to watch Netflix and Amazon Prime video on their mobile devices in the air.
“Our partnership with JetBlue is reframing the entire industry away from a scarcity model — where single-digit percentages of passengers pay very high prices for meager bandwidth — and turning that into planes full of passengers using the whole Internet, including video streaming,” said Dankberg.
ViaSat released results after markets closed. Its shares ended the day up nearly 2 percent at $72.68. They were unchanged in early after-hours trading.