International mobile voice and data satellite communications network provider, Iridium Communications Inc. (Nasdaq: IRDM), yesterday reported financial results for the third quarter of 2020 and updated its full-year 2020 outlook. Net loss was $4.0 million, or $0.03 per diluted share, for the third quarter of 2020, as compared to net loss of $18.0 million, or $0.14 per diluted share, for the third quarter of 2019.
This decrease in net loss was primarily the result of lower net interest expenses related to the refinancing of Iridium’s credit facility and high-yield notes from the year ago period. Also contributing to the improvement was growth in 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, representing a year-over-year increase of 6 percent and an OEBITDA margin of 62 percent. OEBITDA primarily benefited from increased commercial revenue and a reduction in operating expenses.
Iridium reported third-quarter total revenue of $151.5 million, which consisted of $116.9 million of service revenue and $34.6 million of revenue related to equipment sales and engineering and support projects. Total revenue increased 5 percent versus the comparable period of 2019, while service revenue grew by 1 percent. Service revenue, which represents primarily recurring revenue from Iridium’s growing subscriber base, was 77 percent of total revenue for the third quarter of 2020.
The company ended the quarter with 1,429,000 total billable subscribers, which compares to 1,269,000 for the year-ago period and is up by a record 67,000 from 1,362,000 for the quarter ended June 30, 2020. Subscriber growth during the most recent quarter 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.
“Iridium’s business model has proven quite resilient given the importance of our services in the face of a global pandemic,” said Iridium CEO Matt Desch. “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 percent year-over-year, driven by increased demand in the third quarter,” he said.
Based on those results, Desch said Iridium is raising its full-year guidance for 2020.