Globalstar, Inc. (AMEX:GSAT) Q3 2023 Earnings Call Transcript
Globalstar, Inc. (AMEX:GSAT) Q3 2023 Earnings Call Transcript November 4, 2023
Operator: Good day, and thank you for standing by. Welcome to the Globalstar 3Q 2023 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Globalstar CEO, Paul Jacobs. Please go ahead.
Paul Jacobs : Thank you very much, and welcome, everyone, to my first quarterly call as CEO of Globalstar. I'm joined today by Rebecca Clary, our CFO, and Tim Taylor, our VP of Finance, Business Operations and Strategy; and Kyle Pickens, our VP of Strategy. I'll start by making some brief comments, and then we'll spend the bulk of our time getting to your questions. But first, please note that today's call contains forward-looking statements intended to fall within the safe harbor provided under the securities laws. Factors that could cause the results to differ materially are described in the forward-looking statements and Risk Factors section of Globalstar's SEC filings, including its annual report on Form 10-K and for the financial year ending 2022 and as well as this morning's earnings release.
So most of you who know me from Qualcomm will remember my basic approach here to shareholders, analysts and the investment community is to keep the lines of communication open. I'm looking forward to getting to know more of our stakeholders and to that end, we'll be getting out to more events, and we posted several upcoming conferences earlier this week. For those who I haven't had a chance to meet or speak with yet, though that a little background might be helpful. I have a long history with Globalstar going back over 20 years, and the Qualcomm is also involved in other satellite businesses such as OmniTRACS and [Lanware]. Globalstar actually started life as a Qualcomm and Loral joint venture. And in fact, it was 25 years ago yesterday that the first satellite call was placed on the network when my father to then CEO of Loral, Bernard Schwartz.
More recently, it had an ongoing working relationship with James Monroe and Kyle Pickens. So why did I come back to Globalstar? I took the CEO job because I feel Globalstar has a rightsized platform, resource and the great team and one that fits with my vision of where connectivity is heading. The strategic business logic of combining XCOM Labs technology with Globalstar's structural -- spectrum assets provides significant differentiation as we address mission-critical wireless applications. And many of you know that XCOM Labs was already working with Globalstar on spectral efficiency to enhance throughput over Band 53. You might have seen me at the last Investor Day in New York City discussing those initiatives. So I've had a front row seat to a lot of the transformation over the last year.
And the conversations that ensued earlier this summer concluded successfully. So bottom line, a number of us at XCOM Labs knew Globalstar's history. And along with the other folks who've joined Globalstar, we are really energized to be here for the next chapters. For my first 60 days, were spent meeting with customers and partners and reviewing our ongoing initiatives in areas such as enhancing our satellite constellation, evolving our legacy products, growing our IoT business, deploying private 5G networks and others. We've been reviewing spectrum-related opportunities that Globalstar has been considering and how they align with initiatives at both Globalstar and XCOM Labs, with the goal of determining how best to capitalize on our spectrum assets.
The team and I have experience in monetizing spectrum assets, including prior transactions at Qualcomm, which led to multiple billions of dollars of value creation. Partnerships that Globalstar has created open many new opportunities. And I'm excited by the scale of those partnerships and our ability to provide services to a large and ever-increasing number of people around the world. Amidst all the current wireless industry hype around satellite services. Globalstar has run its satellites for decades, and it's humbling to see how well our network plays a key role in saving lives, stories we're seeing on almost a weekly basis. A quick high level on our exon performance last quarter. As outlined in the release, Globalstar continued to sustain its record growth this year with a significant improvement in profitability during the third quarter, driven by results from 53% increase in total revenue.
Service revenue increased 61%. We saw growth in Commercial IoT and adjusted EBITDA was up 125%. And as a result, we're increasing the low end of our 2023 guidance. So my focus will be on differentiating our offerings through innovation. Growing the whole portfolio and investing in R&D to position us for success, all of which we can do strategically and opportunistically. We have the current capacity to deliver solutions to customers globally, at scale and at competitive cost. In conclusion, I believe the transformation over the last year and performance to date reflects just the beginning of our efforts. We expect to elevate Globalstar in conversations with customers around the world. We have new satellites underway and expanding Band 53 capable ecosystem and new products coming online.
So looking forward, our plan is to leverage these unique assets, our proprietary technologies and our team's industry leadership to differentiate ourselves and create value in the space and terrestrial markets. And now I'd like to hand it back to the operator for Q&A.
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