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Iridium Communications IRDM reported earnings per share (EPS) of 32 cents for the fourth quarter of 2024, beating the Zacks Consensus Estimate by 94%. The bottom line compared favorably with the prior quarter's figure of 30 cents per share.
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Quarterly revenues were $213 million, up 9% from the year-ago level. The expansion is driven by increasing sales momentum across all its segments – service, subscriber equipment and engineering and support service. The Zacks Consensus Estimate was pegged at $203.8 million.
Total Service revenues rose 4% year over year to $154 million. The growth in recurring revenues, driven by higher subscriber engagement, drove the performance. Service revenues contributed 72% to total revenues in the fourth quarter. Our estimate for the metric was $152.1 million. Service revenue growth was bolstered by the recovery in equipment demand and the expansion of government contract awards, fueling engineering and support revenues.
Strength in in the commercial Internet of Things (IoT), voice and data, and hosted payload and other data services sectors aided the growth amid the weak commercial broadband sector.
Iridium Communications Inc Price, Consensus and EPS Surprise
Iridium Communications Inc price-consensus-eps-surprise-chart | Iridium Communications Inc Quote
Subscriber Equipment revenues soared 38% year over year to $21.6 million, recovering from supply chain challenges. As expected, 2024 marks a return to normal sales levels after two record years. The fourth-quarter growth reflects strong demand for Iridium services.
Engineering and support revenues surged 20% to $37.4 million, driven by new contracts and growing work with the Space Development Agency. This partnership aligns Iridium with the U.S. government's long-term space goals.
In response to the robust performance across key business segments, shares of IRDM jumped 15.4% in trading on Feb. 13 and closed the session at $31.99. In the past year, shares have risen 5.1% compared with the Zacks Satellite and Communication industry's growth of 38.8%.
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Other Details
Total operating expenses were $160.9 million compared with $148.4 in the prior-year quarter, primarily due to higher selling, general and administrative and research and development costs.
Operational EBITDA (OEBITDA) increased 3% year over year to $117.1 million. Operating income came in at $52.1 million compared with $46.3 million reported in the year-ago quarter.
As of Dec. 31, the company had 2,460,000 billable subscribers, up 8% from 2,279,000 at the prior-year quarter end. The rise was backed by 10% year-over-year growth in commercial IoT subscribers to 1.89 million.