Alexander Phipps

Alexander Phipps asked about the long-term stabilization of ARPU for the GEO business if it's primarily used as a backup solution. He also questioned the dynamics of line-fit options, specifically whether customers can opt out of a Satcom Direct GEO solution in favor of Starlink, and the implications for aircraft delivery. Phipps further sought clarification on the blended ARPA for larger aircraft utilizing multiple connectivity forms and Gogo's perspective on the future geographical composition of its business aviation fleet (Americas, EMEA, APAC) over the next five years, excluding Milgov.

Answer

CEO Chris Moore explained that for global operators, continuity of service is critical, leading to a blended ARPA for larger aircraft from multiple connectivity forms, potentially similar to current GEO ARPA. He emphasized customer choice in connectivity solutions, noting that GEO is still line-fit and desired for regulatory gaps, assurance, cybersecurity, and support. Moore highlighted Gogo's unique position as the only company providing all services, offering an integrated bill. CFO Zachary Cotner added that recent GEO adds were almost exclusively line-fit, indicating continued demand. Moore reiterated that Gogo will be a genuine choice for customers across all airframe sizes with 5G, LEO, and GEO solutions. Regarding fleet composition, Moore suggested the current 60/40 split (North America/International) is a good long-term expectation, growing with the international market.

Alexander Phipps asked about the long-term stabilization of ARPU for the GEO business if used as a backup solution to LEO. He also inquired about line-fit options, specifically whether planes with an existing Satcom Direct GEO solution can opt for Starlink instead, or if they must keep the GEO solution as a backup. He followed up on ARPU expectations for blended LEO/GEO services and the projected mix of Gogo's business aviation fleet (Americas, EMEA, APAC) five years down the line.

Answer

CEO Chris Moore explained that for larger aircraft, Gogo anticipates a blended ARPU from multiple connectivity forms, similar to current GEO ARPUs, due to the critical need for global service continuity and regulatory gaps in LEO networks. He emphasized that customers want GEO as a backup for assurance, cybersecurity, and support. Chris also stated that OEMs always enable choice for connectivity solutions, and customers can opt not to specify certain services. For the fleet mix, Chris suggested that the current 60/40 split (North America/International) is a good long-term expectation, growing as the international market expands. CFO Zach Cotner added that recent GEO adds are almost exclusively line-fit, which helps growth.