Why ViaSat, Inc. (NASDAQ: VSAT) stock is crashing

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ViaSat, Inc. (NASDAQ: VSAT) stock lost over 12.4% on 10th August, 2018 (As of 12:06 PM GMT-4; Source: Google finance). VSAT in the first quarter of FY 19 has reported the adjusted loss per share of 30 cents. Consolidated EBITDA for the first quarter fell relative to last year primarily due to those planned expenditures that drove the growth the company has been anticipating, including higher fixed costs associated with the ViaSat-2 ground network, higher fixed business infrastructure costs that largely support growth in the In-Flight Connectivity and government broadband services and increased marketing expenses to grow the fixed broadband services business.

During the quarter, the company ramped up ViaSat-2 service, a big book of commercial airline orders for in-flight connectivity and already strong momentum and a big order book in the government segment, which led to the growth in the revenue and bottomline.

The company had reported the adjusted revenue growth of 15 percent to $438.90 million in the first quarter of FY 19. Awards are up even more at $570 million, which is an increase of 29% year-over-year and that’s a book-to-bill ratio of about 1.3. Government Systems revenue was up 4% year-over-year and had a very strong orders quarter with a book-to-bill of 1.6. The company activated 122 commercial aircraft on to the IFC or In-Flight Connectivity network and that got the company to 757 in service at the end of the first quarter. That helped the company to drive over 100% increase in revenue in the Commercial Networks segment. The company has still got over 850 additional aircraft under contract as of the end of the first quarter.

Meanwhile, VSAT subsequent to the end of the first quarter, has expanded its relationship with American Airlines and was selected to outfit 100 new American Airlines Airbus A321neo aircraft with its IFC and Wi-Fi entertainment systems. The company will also provide logistics support and network monitoring for its systems on these aircraft.  The delivery of these airplanes is expected to begin in early 2019

Moreover, the company has ended the first quarter with a significant increase in ARPU and a slight increase in total subscribers and has returned to fixed broadband subscription revenue growth on both a sequential and year-over-year basis.

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