LAS VEGAS - Private aviation company Wheels Up has announced a partnership with Gogo (NASDAQ:GOGO) Business Aviation (NASDAQ: GOGO) to install the Gogo Galileo HDX satellite Wi-Fi system across its entire fleet. The installations are slated to commence by mid-2025, pending the completion of aircraft certifications.
The Galileo HDX system is Gogo's latest innovation, designed to offer high-speed, low-latency internet connectivity to meet the growing demand for data-intensive services on board aircraft. Expected to provide peak speeds of up to 60 Mbps, the system aims to deliver consistent performance for business aviation customers.
George Mattson, CEO of Wheels Up, emphasized the importance of superior Wi-Fi for their members and customers, stating that the Galileo HDX system is integral to the company's fleet modernization plans. Wheels Up is poised to become one of the first private aviation fleets with standardized satellite Wi-Fi capability.
Gogo has been testing the new system on a Challenger 300 aircraft, with results meeting expectations. The service, powered by Eutelsat OneWeb's LEO network, is anticipated to launch later this year and will be compatible with any size business aircraft.
Gogo's president and COO, Sergio Aguirre, highlighted the expected benefits for Wheels Up, offering unparalleled performance to its members and customers. As of June 30, 2024, Gogo reported over 7,000 business aircraft equipped with its broadband systems, including narrowband satellite connectivity.
Wheels Up, known for its private aviation services, offers charter and membership programs, as well as partnerships with commercial airlines like Delta Air Lines (NYSE:DAL). The company aims to provide a premium solution for every customer journey, leveraging digital platforms for convenient booking and flying.
The announcement contains forward-looking statements regarding the expected launch and performance of the Galileo HDX system. These statements are based on current expectations and are subject to risks and uncertainties that could affect the financial condition or future results of both Wheels Up and Gogo.
This news article is based on a press release statement from Gogo Business Aviation.
In other recent news, Gogo Inc . has made significant strides in the aviation communications sector. The company has entered into a definitive agreement to acquire Satcom Direct, a move that positions Gogo as the only global in-flight connectivity provider. The $410 million acquisition is expected to generate $485 million in revenue by 2024. Analysts from Roth/MKM have maintained their buy rating on Gogo shares, signaling the deal's positive impact on Gogo's financials.
Gogo has also committed $52.5 million to its partnership with Eutelsat OneWeb, enhancing its service offerings. The company has secured contracts to complete 25 Supplemental Type Certificates, which will extend Gogo's broadband connectivity to more business aircraft. Despite a slight 1% decrease in total revenue for the second quarter of 2024, amounting to $102.1 million, Gogo's service revenue saw a 4% increase, reaching a record high of $81.9 million.
In collaboration with Textron (NYSE:TXT) Aviation, Gogo's Galileo HDX will be factory-installed in Cessna Citation Longitude, Citation Latitude, and Citation Ascend business jets. The commercial launch of Gogo Galileo HDX is anticipated in the fourth quarter of 2024. These are the recent developments for Gogo Inc. and Textron Aviation.
InvestingPro Insights
As Gogo Business Aviation (NASDAQ: GOGO) partners with Wheels Up to revolutionize in-flight connectivity, investors may find additional context from InvestingPro's data and tips valuable.
According to InvestingPro data, Gogo's market capitalization stands at $873.43 million, with a price-to-earnings ratio of 13.26. This relatively modest valuation could be attractive to investors considering the company's potential growth from partnerships like the one with Wheels Up.
An InvestingPro Tip indicates that Gogo has been profitable over the last twelve months, with a gross profit of $269.51 million and an impressive gross profit margin of 67.02% for the same period. This profitability could provide the financial stability needed to support the rollout of the new Galileo HDX system.
Another relevant InvestingPro Tip suggests that Gogo's liquid assets exceed its short-term obligations, which could be crucial for funding the development and installation of the new Wi-Fi systems across Wheels Up's fleet.
It's worth noting that Gogo's stock price has fallen significantly over the last three months, with a three-month price total return of -27.12%. This decline might present an opportunity for investors who believe in the company's long-term prospects, especially given the potential impact of the Wheels Up partnership.
For those interested in a deeper analysis, InvestingPro offers 7 additional tips for Gogo, providing a more comprehensive view of the company's financial health and market position.
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