But the Carlsbad company swung to a wider loss under Generally Accepted Accounting Principles, as product and services expenses ramped up compared with the same quarter last year.
The revenue and backlog gains, however, carried the day with investors. The company’s shares jumped 11 percent to close at $70.79 on Thursday. The stock held those gains Friday, closing unchanged.
There was a lot to unpack in Viasat’s second quarter. Revenue hit $517.5 million, up 32 percent from the same quarter last year.
Wall Street analysts had forecast sales of $469 million for the quarter.
“There's strong growth in all our segments,” said Chief Executive Mark Dankberg in a conference call with analysts. “As expected, in-flight connectivity is leading the way.”
Viasat powers onboard Wi-Fi for American Airlines, JetBlue, United Airlines and others. It serves nearly 900 aircraft today. An additional 859 planes are in the pipeline for antenna installation.
Viasat also supplies tactical radios, data links, satellite connectivity and other communications technologies to military and government customers. Its marquee contract delivers secure, high speed Internet to a fleet of government VIP aircraft used by top U.S. officials.
“Government systems is doing exceptionally well, delivering excellent revenue and earnings growth due to satellite mobility services and growth in other product areas,” said Dankberg. “We're really proud of being the company that serves the most important aircraft in the world.”
The company lost $25.7 million in the quarter, or 43 cents per share under Generally Accepted Accounting Principles. That compares to $13.7 million loss for the same quarter last year.
Adjusted earnings — which is how Wall Street analysts follow the company — came in at $77.5 million, up 25 percent over the same quarter last year. Analysts had expected adjusted earnings of $63 million.
“The primary beat was Viasat’s highly profitable government services business, which roped in $451 million” in pending orders, said Mike Crawford, an analyst with B. Riley/FBR. “Meanwhile, we continue to see the current December quarter as the first of many periods of (earnings) lift-off in the company’s satellite services segment.”
Viasat launched its second Internet satellite, ViaSat-2, more than a year ago. It has been slow to roll out service, however, because some antennas did not deploy properly.
While the malfunction cut into the satellite’s forecast capacity, ViaSat-2 is still the single most powerful Internet satellite in orbit — with about 260 gigabits per second of bandwidth.
The company has submitted $188 million in insurance claims — with about $45 million paid in the recent quarter. Viasat is using the proceeds to pay down debt.
With ViaSat-2, the company has focused on selling top-tier Internet plans to homes outside the reach of cable — such as 100 megabits per second with unlimited data consumption.
While it added just 7,000 new residential subscribers in the quarter, the company’s average revenue per subscriber grew 10 percent year over year.
Viasat ended the quarter with 585,000 Internet subscribers.
The company also is rolling out satellite Internet hot spots in towns in Mexico and Latin America, campgrounds in the U.S. and other hard-to-reach locales with spotty cellular and landline connectivity.
In addition, Viasat is expanding bandwidth services to businesses, and it won a Federal Communications Commission Connect America auction, where it could tap into $122.5 million in subsidies over 10 years to roll out broadband in hard-to-reach areas in 20 states.
The company ended the quarter with an order backlog of $1.9 billion — its highest to date.
“Our record award levels and firm contract backlog builds confidence we can continue to grow,” said Dankberg.
©2018 The San Diego Union-Tribune. Distributed by Tribune Content Agency, LLC.
