Release Date: March 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: You mentioned having 1,000 new ads from Starlink this quarter. Is this your expectation going forward on a quarterly basis? A: We shipped 1,000 terminals, but not all were activated in the fourth quarter. We activated just under 700 Starlink maritime terminals. Some terminals shipped in previous quarters are still awaiting activation. Any terminal we ship is locked to our service, ensuring it can't be used elsewhere without our permission.
Q: What leads companies to delay their activation of Starlink terminals? A: There are several reasons, including commercial, leisure, and OEMs. OEMs may install terminals on boats not yet delivered to owners. The cost of Starlink equipment is lower compared to VSAT, leading dealers and distributors to keep more units on hand.
Q: Are the customers procuring Starlink dishes mainly existing customers transitioning to Starlink, or new customers without prior satellite connectivity? A: Activations include both new and existing customers. New customers may not have had VSAT but could have used lower bit rate communication systems. They are attracted by the cost structure of Starlink terminals and airtime.
Q: With emerging constellations like Kuiper and Chinese constellations, do you anticipate any market response? A: We anticipate a market response, but it's still early. Kuiper is testing, and commercial service is expected by 2026 or early 2027. We are monitoring developments closely and engaging with industry players.
Q: How does the terminal pricing of OneWeb compare to SpaceX, and what are the reasons customers choose OneWeb? A: OneWeb terminals are more expensive than Starlink, roughly 2x the price. Customers choose OneWeb for network diversity and features like CIR. Seaspan, for example, uses Starlink, OneWeb, and VSAT for a hybrid configuration.
Q: Is the Commbox feature set competitive in the market, and does it have applicability in new markets? A: Yes, the Commbox feature set is competitive, especially with upcoming cybersecurity enhancements. It is applicable in new markets, including land initiatives, where we are seeing good traction.
Q: Are you able to manage costs with the rate of VSAT terminal loss, and what is the current rate of VSAT loss? A: The rate of VSAT loss has evened out, showing consistent churn. We shipped 200 VSATs this quarter, mostly in hybrid configurations. We are managing the VSAT network carefully, reducing CapEx, and matching revenue with expenses.
Q: What is the base run rate CapEx, excluding the agile plan? A: The base run rate CapEx is a couple of million dollars, primarily for a new ERP system. Historically, 70%-80% of our CapEx is related to agile programs, but we expect minimal CapEx outside the ERP system.
Q: Can we expect free cash flow to be positive in 2025? A: Yes, we are striving for free cash flow positivity in 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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