Story ID: 
Gogo BizAv Revenues, Profit  Surge
By: Kerry Lynch
Caption: Gogo Business Aviation service revenue outpaces equipment sales in fourth quarter for first time.
Word Count: 212
In-flight communications specialist Gogo is expecting its business aviation segment revenues to rise by as much as 16 percent this year, following a 22-percent increase in 2014. During a fourth-quarter investor call yesterday, Gogo reported business aviation revenue reached $155.6 million last year, while profits jumped 24 percent, to $63 million. With high investment costs, Gogo posted an $84.5 million loss in 2014 for the overall company, narrowing from the $111.3 million loss in 2013.

Service revenue drove the improved results for Gogo Business Aviation, formerly known as Aircell. Service revenue soared 37 percent last year, to $72 million, while equipment sales posted more modest gains of 6 percent, to $83.6 million.

The increases reflected not only a jump in air-to-ground (ATG) systems installed but also higher average service revenue per equipped aircraft. The number of ATG systems in use increased 37 percent, to 2,797 at the end of the fourth quarter. The number of satellite systems in use increased to 5,377, a 4-percent improvement.

In the fourth quarter, Gogo’s service revenue exceeded equipment revenue for the first time. While more systems were installed in the fourth quarter than in the same period a year earlier, Gogo shipped fewer of them, causing equipment revenue to slide from $22.1 million in fourth quarter 2013 to $19.4 million in the same period last year.