We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Iridium (IRDM) Records Narrower Q1 Loss, Revenues Up Y/Y
Read MoreHide Full Article
Iridium Communications Inc. (IRDM - Free Report) reported relatively healthy first-quarter 2021 results, with GAAP net loss narrowing year over year on higher revenues. Despite double-digit subscriber growth supported by robust demand for consumer-oriented IoT devices amid modest recovery post the COVID-19 turmoil, the stock plunged 6.6% to close at $35.93 on Apr 20.
Bottom Line
On a GAAP basis, net loss in the March quarter was $5.2 million or loss of 4 cents per share. The figure was narrower than net loss of $31.7 million or loss of 24 cents per share in the prior-year quarter. The year-over-year improvement was mainly driven by higher revenues. Absence of debt extinguishment costs, along with refinancing of senior unsecured notes in the prior-year period, was also a contributing factor. The bottom line was narrower than the Zacks Consensus Estimate of a loss of 5 cents.
Iridium Communications Inc Price, Consensus and EPS Surprise
Quarterly revenues totaled $146.5 million compared with $145.3 million in the year-ago quarter, mainly driven by strength in subscriber equipment sales and higher service revenues. The top line matched the consensus mark of $147 million.
Total service revenues inched up 0.2% to $116.2 million from $116 million in the year-ago quarter. This was primarily driven by growing subscriber base in the commercial and government service business. Markedly, service revenues contributed 79% to total revenues in the first quarter.
Subscriber equipment revenues improved 8% to $24 million from $22.3 million in the year-ago quarter due to its robust demand. Favorable shipments and healthy growth trend are expected to drive its sales. However, engineering and support service revenues declined 8.8% to $6.4 million from $7 million in the prior-year quarter, mainly due to the episodic nature of contracted work with the U.S. government.
Other Details
Total operating expenses were $137.5 million compared with $133.5 million in the prior-year quarter mainly due to higher selling, general and administrative expenses. Operational EBITDA (OEBITDA) decreased 2.5% to $89.8 million or 61.3% of revenues from $92.1 million or 63.4% of revenues in the first quarter of 2020.
During the quarter, the company registered 1,518,000 billable subscribers compared with 1,332,000 in the year-ago quarter. The year-over-year increase was backed by growth in commercial and government IoT customers, driven by continued strength in personal communications devices.
Cash Flow & Liquidity
During the first three months of 2021, Iridium generated $50.8 million of net cash from operations compared with $40.8 million in the prior-year period. Capital expenditures were $9.4 million in the reported quarter compared with $9.5 million in the year-ago period. As of Mar 31, the company had $214.8 million in cash and cash equivalents with $1,594 million of net long-term secured debt. As part of the previously announced $300 million share buyback program, the company repurchased 1.6 million shares at a total purchase price of $59.3 million.
2021 Guidance Restated
Despite the macroeconomic headwinds caused by COVID-19 pandemic, Iridium has emerged as a strong player on the back of its resilient business model. The company has reiterated bullish outlook for 2021 and expects service revenues to grow 3% year over year. Iridium expects full-year 2021 OEBITDA to be between $365 million and $375 million, up from $355.6 million in 2020. Net leverage is anticipated to be nearly 3.5x OEBITDA by the end of 2022.
Cambium delivered a trailing four-quarter positive earnings surprise of 128%, on average.
ORBCOMM delivered a trailing four-quarter positive earnings surprise of 24%, on average.
Nokia delivered a trailing four-quarter positive earnings surprise of 40.2%, on average.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Image: Bigstock
Iridium (IRDM) Records Narrower Q1 Loss, Revenues Up Y/Y
Iridium Communications Inc. (IRDM - Free Report) reported relatively healthy first-quarter 2021 results, with GAAP net loss narrowing year over year on higher revenues. Despite double-digit subscriber growth supported by robust demand for consumer-oriented IoT devices amid modest recovery post the COVID-19 turmoil, the stock plunged 6.6% to close at $35.93 on Apr 20.
Bottom Line
On a GAAP basis, net loss in the March quarter was $5.2 million or loss of 4 cents per share. The figure was narrower than net loss of $31.7 million or loss of 24 cents per share in the prior-year quarter. The year-over-year improvement was mainly driven by higher revenues. Absence of debt extinguishment costs, along with refinancing of senior unsecured notes in the prior-year period, was also a contributing factor. The bottom line was narrower than the Zacks Consensus Estimate of a loss of 5 cents.
Iridium Communications Inc Price, Consensus and EPS Surprise
Iridium Communications Inc price-consensus-eps-surprise-chart | Iridium Communications Inc Quote
Revenues
Quarterly revenues totaled $146.5 million compared with $145.3 million in the year-ago quarter, mainly driven by strength in subscriber equipment sales and higher service revenues. The top line matched the consensus mark of $147 million.
Total service revenues inched up 0.2% to $116.2 million from $116 million in the year-ago quarter. This was primarily driven by growing subscriber base in the commercial and government service business. Markedly, service revenues contributed 79% to total revenues in the first quarter.
Subscriber equipment revenues improved 8% to $24 million from $22.3 million in the year-ago quarter due to its robust demand. Favorable shipments and healthy growth trend are expected to drive its sales. However, engineering and support service revenues declined 8.8% to $6.4 million from $7 million in the prior-year quarter, mainly due to the episodic nature of contracted work with the U.S. government.
Other Details
Total operating expenses were $137.5 million compared with $133.5 million in the prior-year quarter mainly due to higher selling, general and administrative expenses. Operational EBITDA (OEBITDA) decreased 2.5% to $89.8 million or 61.3% of revenues from $92.1 million or 63.4% of revenues in the first quarter of 2020.
During the quarter, the company registered 1,518,000 billable subscribers compared with 1,332,000 in the year-ago quarter. The year-over-year increase was backed by growth in commercial and government IoT customers, driven by continued strength in personal communications devices.
Cash Flow & Liquidity
During the first three months of 2021, Iridium generated $50.8 million of net cash from operations compared with $40.8 million in the prior-year period. Capital expenditures were $9.4 million in the reported quarter compared with $9.5 million in the year-ago period. As of Mar 31, the company had $214.8 million in cash and cash equivalents with $1,594 million of net long-term secured debt. As part of the previously announced $300 million share buyback program, the company repurchased 1.6 million shares at a total purchase price of $59.3 million.
2021 Guidance Restated
Despite the macroeconomic headwinds caused by COVID-19 pandemic, Iridium has emerged as a strong player on the back of its resilient business model. The company has reiterated bullish outlook for 2021 and expects service revenues to grow 3% year over year. Iridium expects full-year 2021 OEBITDA to be between $365 million and $375 million, up from $355.6 million in 2020. Net leverage is anticipated to be nearly 3.5x OEBITDA by the end of 2022.
Zacks Rank & Stocks to Consider
Iridium currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader industry are Cambium Networks Corporation (CMBM - Free Report) , ORBCOMM Inc. and Nokia Corporation (NOK - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cambium delivered a trailing four-quarter positive earnings surprise of 128%, on average.
ORBCOMM delivered a trailing four-quarter positive earnings surprise of 24%, on average.
Nokia delivered a trailing four-quarter positive earnings surprise of 40.2%, on average.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2021 today >>