Gogo reveals net losses of $86M in Q2 of 2020 due to COVID-19 crisis

Gogo Inc., an in-flight broadband connectivity firm based in Chicago, has reportedly posted net losses of over $86 million in the Q2 of FY2020 due to the COVID-19 crisis.
According to Oakleigh Thorne, CEO of Gogo, the company has encountered immense losses amid the pandemic. The crisis has posed adverse impacts on the aviation industry as the governments imposed several restrictions to curb the virus spread across the globe. As a cost-cutting strategy, the company has also furloughed and reduced its workforce with an aim to meet the liquidity requirements. Mr. Thorne has further added that the company has the required liquidity to weather the debts and liabilities in the post-COVID world. He also expects a steady recovery in the next quarters. Additionally, the firm has launched a formal process to significantly evaluate the strategic options.
For the record, the company had previously announced the elimination of over 145 employees across all operations, including nearly 10 jobs in Broomfield. This employee layoff happened along the heels of furloughing 600 workers in April, which has impacted around 90 Broomfield employees. The Broomfield location is home to around 300 workers. The company also has booked consolidated sales of $96.6 million, which a 55% decline from the same period in the previous year.
Gogo officials have cited that the recent Q2 earnings represent the 1st time the company has recorded negative EBITDA (earnings before interest, taxes, depreciation & amortization) since 2013. The company is currently planning to offload its Commercial Aviation division, which has been providing Wi-Fi to major airline customers.
Gogo consists of 2 divisions, namely Business Aviation and Commercial Aviation. Thorne expects that the company’s Business Aviation segment is likely to bounce back to normal more rapidly than the Commercial Aviation segment. Business Aviation had accounted for a revenue worth $54.6 million in the Q2 of 2020, a 23% decline as compared to a year earlier. On the other hand, the Commercial Aviation unit had registered sales of $30 million, a 72% reduction Y-o-Y from 2019.
Source credit:
https://www.dailycamera.com/2020/08/10/gogo-posts-86m-loss-looks-to-sell-business-unit/