Viasat, Inc. (NASDAQ:VSAT) Q1 2023 Earnings Conference Call August 8, 2022 5:00 PM ET

Company Participants

Mark Dankberg - Co-Founder, Chairman and Chief Executive Officer

Robert Blair - Senior Vice President, General Counsel and Secretary

Richard Baldridge - Vice Chairman

Shawn Duffy - Senior Vice President and Chief Financial Officer

Conference Call Participants

Landon Park - Morgan Stanley

Chris Quilty - Quilty Analytics LLC

Ric Prentiss - Raymond James & Associates

Ryan Koontz - Needham & Company, LLC

Mike Crawford - B. Riley FBR, Inc.

Operator

Welcome to Viasat's Fiscal Year 2023 First Quarter Earnings Conference Call. Your host for today's call is Mark Dankberg, Chairman and CEO. You may proceed, Mr. Dankberg.

Mark Dankberg

Thanks for joining us today. We released our shareholder letter shortly after the market closed today, and it's available on our website. We'll be referring to it on the call.

Joining me on the call today are Rick Baldridge, is our Vice Chairman now; Kevin Harkenrider, our Chief Operating Officer; Shawn Duffy, our Chief Financial Officer; Robert Blair, our General Counsel; Paul Froelich, Corporate Development and Peter Lopez, Investor Relations. So I'll let Robert provide our safe harbor, first.

Robert Blair

Thanks, Mark. As you know, this discussion will contain forward-looking statements. This is a reminder that factors could cause actual results to differ materially. Additional information concerning these factors is contained in our SEC filings, including our most recent reports on Form 10-K and Form 10-Q. Copies are available from the SEC or from our website.

Back to you, Mark.

Mark Dankberg

Okay. Thanks. Our results for the first quarter were consistent with the outlook that we described in our fiscal year 2022 fourth quarter year-end call in May. Several factors, including seasonality delays and certifying some of the new informational security products and some transient supply chain issues affected our sequential topline. So an improved revenue mix across our service networks and lower R&D spend in the quarter heavily offset below revenue as well as our growing ViaSat-3 ground infrastructure. Operating expenses that are in preparation for this falls launch. So collectively resulting in only a slight sequential decline in adjusted EBITDA.

It's worth noting that consolidated service revenue and Satellite Services segment revenue both achieve new records in the quarter, partially offset by the impact of product revenue from some of the factors I had just described. We expect our first quarter EBITDA to be the low point of the fiscal year with good sequential growth from here throughout fiscal year 2023, driven largely by scheduled in-flight connectivity installations into activations, significant government backlog and strong government systems orders in the first quarter and also so far in the second quarter. We are expecting that will grow our fleet of active in-flight aircraft by about 500 over the remainder of this fiscal year on both new and retrofit aircraft for both new and existing customers.