Clarification on normalized OpEx run rate, impact of $14M litigation expense (above prior expectations) on 2026/2027, and peak non-GAAP OpEx in 2026.

Normalized OpEx (excluding D&A) is expected in the mid-to-high $40s. Sales & marketing should be flat, engineering will have a slight pop due to milestone payments, and G&A includes the litigation expense related to SmartSky. “we look at it like sort of the normalized run weight, kind of in the mid to high 40s. obviously excluding DNA.”

Further details on lower equipment sales expectations and service product mix headwinds that led to the updated guidance.

The primary driver for the revised guidance is lower equipment revenue, which has near break-even margins. Service revenue expectations remain consistent due to MilGov and GEO offsetting ATG softness. Delays in Galileo STCs (FAA backlog) and OEM line-fit integration are slowing product rollout. “the single biggest driver is the equipment revenue, which again is, is assumed at almost break even margins.”

How many ATG aircraft are expected to net roll off this year, any new dynamics? Will GEO aircraft online hold steady or taper in H2?

Approximately 1,200 ATG aircraft (including 5G) are expected to roll off this year. The underlying ATG deactivation rate (excluding NetJets and upgrades to new products) was flat QoQ. GEO aircraft online is expected to lose a small number, but performance is improving due to operator investment and aircraft sales being the primary driver of changes. “ATG, because of the trend we saw in in Q2, the estimated total units online, we're saying about 1,200, and that's total including 5G.”

GOGO

Gogo (GOGO) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Communication Services· Aug 6, 2026

Source: earnings call transcript

Executive summary

Gogo Q2 FY26 — Strong Galileo and Military/Government Momentum Amidst ATG Transition

Gogo continues its transformation into a global multi-network connectivity platform, driven by strong progress in its Galileo LEO service and record performance in the military and government sector. While navigating the expected decline in legacy ATG revenue and facing some equipment shipment delays, the company is focused on disciplined capital allocation, with debt reduction remaining its highest priority.

Highlights

Military and Government service revenue increased by 40% year-over-year and 20% sequentially.
LEO aircraft online increased 66% sequentially to 184 aircraft.
GoGo 5G unit shipments increased 165% from Q1 to 138 units.
Net cash provided by operating activities totaled $32.3 million, up from negative $7.2 million in Q1.
Free cash flow was $21.6 million, up from negative $19.2 million in Q1.

Concerns

Total revenue for the quarter was $222.8 million, down 1% compared to Q2 2025 and 2% sequentially.
Adjusted EBITDA was $53.7 million, down 13% compared to Q2 2025.
Net leverage ratio increased to 3.8 times due to SATCOM direct earn-out payment.
Full-year 2026 total revenue guidance revised down to $870M-$895M from prior expectations.
Full-year 2026 Adjusted EBITDA guidance revised down to $175M-$185M, including $22M of litigation expense.

Guidance & targets

Category	Target	Timeline	Confidence
Total Revenue	$870M to $895M high materiality	Full Year 2026 · FY26	High
Service Revenue as % of Total Revenue	approximately 84% medium materiality	Full Year 2026 · FY26	High
Equipment Revenue as % of Total Revenue	approximately 16% medium materiality	Full Year 2026 · FY26	High
Adjusted EBITDA	$175M to $185M high materiality	Full Year 2026 · FY26	High
Net Capital Expenditures	approximately $20M medium materiality	Full Year 2026 · FY26	High
Free Cash Flow	$65M to $85M high materiality	Full Year 2026 · FY26	High
Strategic Investments	$30M medium materiality	Full Year 2026 · FY26	High
Galileo Units Online	mid-500s medium materiality	End of Year · FY26	High
FCC Reimbursement Program Completion	on schedule medium materiality	November 8, 2026 · FY26	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Military and Government Strong demand and increased utilization of existing services, driven by ongoing conflict in the Middle East. Exploring alternative uses for ATG and satellite networks in support of unmanned aerial vehicles (UAVs).	—	40%	20%	—

Product announcements

Product	Type	Timeline	Details
GoGo Galileo HDX	milestone	—

Deals & partnerships

AirShare Equipping its fleet of Embraer Finon 300s with Galileo HDX.

AirShare is a leading U.S.-based fractional ownership jet card and aircraft management operator. Decision followed a live demonstration flight where the system transferred over 16 gigabytes of data in one hour.

VistaJet, WheelsUp, NetJet Rollouts of GoGoGalileo platform.

The rollouts discussed last quarter with these counterparties continue to progress well.

OEMs Contracts for Galileo line fit into the OEM process at the factory.

All OEMs are now locked into contracts for Galileo, which is expected to ramp up line fit during the second half of the year.

SATCOM Direct Funding of previously announced earn-out payment. $40M

The $40 million earn-out payment was funded, contributing to the increase in the net leverage ratio.

Risks & headwinds

Decline in legacy ATG service revenue Ongoing

Total ATG aircraft online down 15% YoY and 6% sequentially to 5,731.

Mitigation:Diversifying business with Galileo, 5G, and Military/Government growth.

Delays in Galileo product rollout (STCs and OEM line fit) Near term, expected to accelerate in H2 FY26

20 STCs outstanding for FDX; FAA backlog slowing process.

Mitigation:OEMs locked into contracts, expecting line fit ramp in H2 FY26.

Litigation expense Ongoing through 2026, potentially into 2027

$3.2 million in Q2 FY26, $6.1 million in Q1 FY26. Full-year guidance includes $22 million.

Mitigation:Managed within adjusted EBITDA guidance.

Net leverage ratio increase Q2 FY26, expected to fluctuate modestly over balance of year

Increased to 3.8 times in Q2 FY26.

Mitigation:Debt reduction remains highest capital allocation priority, targeting 2.5 to 3.5 times.

What to watch in Q3 FY26

Galileo units online

End of FY26

Current 184 aircraft

Target Mid-500s aircraft

Why it matters

Indicates adoption and operational deployment of key LEO service, driving recurring service revenue.

the model assumes kind of at the high end, we're in the mid-500s for total Galileo.

Find out whether GOGO delivers this. Inve re-checks your case every morning.

Q&A highlights

Update on Galileo units online target for year-end (600 previously), 5G pipeline (500+ aircraft), and MilGov opportunity (absolute dollars/mix in 2027, utilization vs. new aircraft).

Management confirmed Galileo units online target in the mid-500s for year-end. For MilGov, they highlighted global modernization opportunities, cost-effective commercial-based products for military, and early traction in the UAV market, but did not provide specific dollar or mix targets for 2027, stating it's too early.

“the model assumes kind of at the high end, we're in the mid-500s for total Galileo.”

asked by Scott Serrell · answered by Zachary Cotner

2 min read 5 chapters

Detailed narrative

Galileo LEO Service Momentum

Gogo's global LEO service, Galileo (HDX for smaller aircraft, FDX for mid/large cabin), showed significant progress with 108 units shipped this quarter, bringing cumulative LEO terminal shipments to 518. LEO aircraft online increased 66% sequentially to 184, demonstrating accelerated operational deployment and recurring service revenue generation.

The company secured new fleet commitments, including AirShare, and received several key FAA and EASA STCs for HDX, expanding its total addressable market.

5G and ATG Transition

The company saw continued momentum in its latest ATG offerings, with 5G unit shipments increasing 165% sequentially to 138 units. C1 systems online reached a record 690, up 24% from Q1. While total ATG aircraft online declined 15% YoY and 6% sequentially to 5,731, this was attributed to customer transitions to newer Gogo products (Galileo or 5G) and the NetJets fleet transition, rather than underlying attrition.

Military and Government Business Strength

The military and government end market delivered a record quarter, with service revenue increasing 40% year-over-year and 20% sequentially. This growth is driven by strong demand and increased utilization of existing services due to ongoing geopolitical conflicts, validating Gogo's strategy of diversifying beyond traditional business aviation. The company is also exploring opportunities in the unmanned aerial vehicle (UAV) market.

FCC Reimbursement Program

Gogo is making strong progress towards the November 8, 2026, completion deadline for the FCC reimbursement program, which covers the cost of removing and replacing covered equipment across the U.S. network and ATG aircraft. Reimbursements continue to offset program costs, and upon completion, Gogo will operate the only fully US-based data-sovereign ATG network.

Financial Performance and Capital Allocation

Q2 performance met profitability expectations, with adjusted EBITDA of $53.7 million. The company generated $32.3 million in net cash from operating activities and $21.6 million in free cash flow. Reducing leverage remains the highest capital allocation priority, with a net leverage ratio of 3.8 times and a target of 2.5 to 3.5 times.

Full-year guidance was revised due to equipment shipment timing and increased litigation expenses.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.