Iridium’s headline profit jumps on acquisition gain while operating EBITDA slips

Iridium ($IRDM) reported quarterly revenue of $245.7 million, up 8%, with service revenue increasing 13%. Subscribers rose 6% to approximately 2.696 million. Net income reached $106.9 million, or $0.98 per share, compared with $37.1 million and $0.35 a year earlier. The headline earnings increase included a $103.9 million acquisition-related gain, making the reported profit growth an imperfect measure of recurring operations.

Operational EBITDA was $135.6 million, slightly below $136.6 million in the comparable quarter, and included $4.5 million of higher cash incentive costs. The results therefore show growth in customers and service revenue without a corresponding increase in this operating-profit measure. The Aireon acquisition had already closed in July and is relevant here as accounting background, not a newly announced purchase. The operating measure consequently provides a more restrained picture of quarterly profitability than the increase in headline net income alone.

Sources:

• Iridium — PR Newswire quarterly results