In-flight connectivity provider Gogo on Wednesday issued its first quarterly earnings report as a publicly traded company, reporting a net loss of $72.6 million for the second quarter, five times the net loss of $13.1 million seen in the same period last year.
The company attributes the net loss to increased expenses, including $44.8 million from accounting for derivative instruments. Despite the net loss, Gogo CEO Michael Small and Executive Vice President Norm Smagley told investors during a conference call they were very pleased with the company's operating performance, and position for future growth.
"I’m very pleased with our financial and operating performance for the quarter and for the first half of 2013. We continue to execute well against our strategy to increase number of aircraft online and to increase revenue per aircraft," said Small.
Total revenue increased 37 percent to $79.4 million for the second quarter, compared to the same period last year.
Passengers on U.S. carriers are primarily driving revenue for Gogo, as its North American commercial aviation segment revenue increased to $49.8 million, a 37 percent increase over the year-earlier quarter. The in-flight connectivity provider's take rate, which measures the percentage of fliers on Gogo-equipped aircraft using the service, increased to 5.9 percent, up from 5.3 percent during the second quarter 2012.
Gogo uses a network of land-based towers to connect passengers to its equipment onboard commercial and business aircraft. They're currently investing in satellite technology, and looking to deploy their in-flight network in more countries around the world.
Currently Gogo has 470 aircraft within the U.S. and internationally that are within its backlog waiting to be equipped with service. The company's outlook for the full year is total revenue of $305 million to $315 million.
Small told analysts Wednesday that he expects both take rate and revenues to continue to grow along with "increasing passenger expectations of connectivity everywhere."