Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2019	May 06, 2019
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Entity Registrant Name	Gogo Inc.
Entity Central Index Key	0001537054
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Trading Symbol	GOGO
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Common Stock, Shares Outstanding		87,797,851

Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 188,690	$ 184,155
Short-term investments		39,323
Total cash, cash equivalents and short-term investments	188,690	223,478
Accounts receivable, net of allowances of $583 and $500, respectively	123,791	134,308
Inventories	147,354	193,045
Prepaid expenses and other current assets	32,140	34,695
Total current assets	491,975	585,526
Non-current assets:
Property and equipment, net	565,485	511,867
Goodwill and intangible assets, net	82,888	83,491
Operating lease right-of-use assets	70,129
Other non-current assets	86,333	84,212
Total non-current assets	804,835	679,570
Total assets	1,296,810	1,265,096
Current liabilities:
Accounts payable	27,861	23,860
Accrued liabilities	183,067	213,111
Deferred revenue	37,602	38,571
Deferred airborne lease incentives	22,726	24,145
Total current liabilities	271,256	299,687
Non-current liabilities:
Long-term debt	1,030,359	1,024,893
Deferred airborne lease incentives	131,743	129,086
Non-current operating lease liabilities	99,870
Other non-current liabilities	47,556	80,191
Total non-current liabilities	1,309,528	1,234,170
Total liabilities	1,580,784	1,533,857
Commitments and contingencies (Note 12)
Stockholders' deficit
Common stock, par value $0.0001 per share; 500,000,000 shares authorized at March 31, 2019 and December 31, 2018; 87,878,770 and 87,678,812 shares issued at March 31, 2019 and December 31, 2018, respectively; and 87,797,614 and 87,560,694 shares outstanding at March 31, 2019 and December 31, 2018, respectively	9	9
Additional paid-in-capital	967,727	963,458
Accumulated other comprehensive loss	(3,144)	(3,554)
Accumulated deficit	(1,248,566)	(1,228,674)
Total stockholders' deficit	(283,974)	(268,761)
Total liabilities and stockholders' deficit	$ 1,296,810	$ 1,265,096

Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Allowances on accounts receivable	$ 583	$ 500
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	87,878,770	87,678,812
Common stock, shares outstanding	87,797,614	87,560,694

Unaudited Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenue:
Total revenue	$ 199,549	$ 231,825
Operating expenses:
Cost of service revenue (exclusive of items shown below)	68,121	74,947
Cost of equipment revenue (exclusive of items shown below)	29,731	52,293
Engineering, design and development	24,728	29,777
Sales and marketing	12,318	15,901
General and administrative	22,454	25,159
Depreciation and amortization	30,749	35,919
Total operating expenses	188,101	233,996
Operating income (loss)	11,448	(2,171)
Other (income) expense:
Interest income	(1,149)	(1,076)
Interest expense	32,554	30,554
Other income	(3,365)	(505)
Total other expense	28,040	28,973
Loss before income taxes	(16,592)	(31,144)
Income tax provision (benefit)	207	(3,725)
Net loss	$ (16,799)	$ (27,419)
Net loss attributable to common stock per share—basic and diluted	$ (0.21)	$ (0.34)
Weighted average number of shares—basic and diluted	80,446	79,696
Service [Member]
Revenue:
Total revenue	$ 165,012	$ 150,678
Product [Member]
Revenue:
Total revenue	$ 34,537	$ 81,147

Unaudited Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Statement of Comprehensive Income [Abstract]
Net loss	$ (16,799)	$ (27,419)
Currency translation adjustments, net of tax	410	(834)
Comprehensive loss	$ (16,389)	$ (28,253)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Operating activities:
Net loss	$ (16,799)	$ (27,419)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization	30,749	35,919
Loss on asset disposals, abandonments and write-downs	1,241	1,687
Gain on transition to airline-directed model		(19,302)
Deferred income taxes	44	(3,863)
Stock-based compensation expense	4,327	4,386
Amortization of deferred financing costs	1,249	1,035
Accretion and amortization of debt discount and premium	4,774	4,539
Changes in operating assets and liabilities:
Accounts receivable	10,635	(14,046)
Inventories	(1,118)	(12,304)
Prepaid expenses and other current assets	3,015	(1,863)
Contract assets	(6,175)	2,578
Accounts payable	2,843	11,755
Accrued liabilities	(19,381)	(7,229)
Deferred airborne lease incentives	(3,923)	(1,834)
Deferred revenue	2,257	5,440
Accrued interest	(19,514)	(24,955)
Warranty reserves	(588)	442
Other non-current assets and liabilities	208	(1,171)
Net cash used in operating activities	(6,156)	(46,205)
Investing activities:
Purchases of property and equipment	(23,154)	(56,886)
Acquisition of intangible assets—capitalized software	(4,557)	(5,772)
Purchases of short-term investments		(39,323)
Redemptions of short-term investments	39,323	69,482
Other, net	95
Net cash provided by (used in) investing activities	11,707	(32,499)
Financing activities:
Payment of debt issuance costs	(557)
Payments on financing leases	(125)	(618)
Stock-based compensation activity	(58)	(70)
Net cash used in financing activities	(740)	(688)
Effect of exchange rate changes on cash	(276)	75
Increase (decrease) in cash, cash equivalents and restricted cash	4,535	(79,317)
Cash, cash equivalents and restricted cash at beginning of period	191,116	203,729
Cash, cash equivalents and restricted cash at end of period	195,651	124,412
Cash, cash equivalents and restricted cash at end of period	195,651	124,412
Less: current restricted cash	1,535	738
Less: non-current restricted cash	5,426	6,635
Cash and cash equivalents at end of period	188,690	117,039
Supplemental Cash Flow Information:
Cash paid for interest	46,163	49,911
Cash paid for taxes	41	15
Noncash Investing and Financing Activities:
Purchases of property and equipment in current liabilities	19,951	23,325
Purchases of property and equipment paid by commercial airlines	$ 5,016	$ 2,060

Unaudited Condensed Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Loss [Member]	Accumulated Deficit [Member]
Beginning Balance at Dec. 31, 2017	$ (191,564)	$ 9	$ 898,729	$ (933)	$ (1,089,369)
Beginning Balance, Shares at Dec. 31, 2017		86,843,928
Net loss	(27,419)				(27,419)
Currency translation adjustments, net of tax	(834)			(834)
Stock-based compensation expense	4,386		4,386
Issuance of common stock upon vesting of restricted stock units and restricted stock awards, Shares		107,335
Tax withholding related to vesting of restricted stock units	(526)		(526)
Issuance of common stock in connection with employee stock purchase plan	456		456
Issuance of common stock in connection with employee stock purchase plan, Shares		55,812
Impact of the adoption of ASC 842	24,165				24,165
Ending Balance at Mar. 31, 2018	(191,336)	$ 9	903,045	(1,767)	(1,092,623)
Ending Balance, Shares at Mar. 31, 2018		87,007,075
Beginning Balance at Dec. 31, 2018	(268,761)	$ 9	963,458	(3,554)	(1,228,674)
Beginning Balance, Shares at Dec. 31, 2018		87,560,694
Net loss	(16,799)				(16,799)
Currency translation adjustments, net of tax	410			410
Stock-based compensation expense	$ 4,327		4,327
Issuance of common stock upon vesting of restricted stock units and restricted stock awards, Shares	161,667
Tax withholding related to vesting of restricted stock units	$ (351)		(351)
Issuance of common stock in connection with employee stock purchase plan	293		293
Issuance of common stock in connection with employee stock purchase plan, Shares		75,253
Impact of the adoption of ASC 842	(3,093)				(3,093)
Ending Balance at Mar. 31, 2019	$ (283,974)	$ 9	$ 967,727	$ (3,144)	$ (1,248,566)
Ending Balance, Shares at Mar. 31, 2019		87,797,614

Basis of Presentation

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Basis of Presentation

The Business

Gogo (“we,” “us,” “our”) is the global leader in providing broadband connectivity solutions and wireless in-flight entertainment to the aviation industry. We operate through the following three segments: Commercial Aviation North America, or “CA-NA,” Commercial Aviation Rest of World, or “CA-ROW,” and Business Aviation, or “BA.” Services provided by our CA-NA and CA-ROW businesses include Passenger Connectivity, which allows passengers to connect to the Internet from their personal Wi-Fi-enabled devices; Passenger Entertainment, which offers passengers the opportunity to enjoy a broad selection of in-flight entertainment options on their personal Wi-Fi enabled devices; and Connected Aircraft Services (“CAS”), which offers airlines connectivity for various operations and currently include, among other services, real-time credit card transaction processing, electronic flight bags and real-time weather information. Services are provided by CA-NA on commercial aircraft flying routes that generally begin and end within North America, which for this purpose includes the United States, Canada and Mexico. CA-ROW provides service on commercial aircraft operated by foreign-based commercial airlines and flights outside of North America for North American-based commercial airlines. The routes included in our CA-ROW segment are those that begin and/or end outside of North America (as defined above) on which our international service is provided. BA provides in-flight Internet connectivity and other voice and data communications products and services and sells equipment for in-flight telecommunications to the business aviation market. BA services include Gogo Biz, our in-flight broadband service, Passenger Entertainment, our in-flight entertainment service, and satellite-based voice and data services through our strategic alliances with satellite companies.

Basis of Presentation

- The accompanying unaudited condensed consolidated financial statements and notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with Article 10 of Regulation S-X promulgated under the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements and should be read in conjunction with our annual audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2018 as filed with the Securities and Exchange Commission (“SEC”) on February 21, 2019 (the “2018 10-K”). These unaudited condensed consolidated financial statements reflect, in the opinion of management, all material adjustments (which include normal recurring adjustments) necessary to fairly state, in all material respects, our financial position, results of operations and cash flows for the periods presented.

The results of operations and cash flows for the three month period ended March 31, 2019 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2019.

We have one class of common stock outstanding as of March 31, 2019 and December 31, 2018.

Reclassifications

– To conform with the current year presentation, certain amounts in our unaudited condensed consolidated statements of cash flows for the three month period ended March 31, 2018 have been reclassified. Specifically, contract assets and warranty reserves are presented separately. Contract assets of $2,578 thousand was originally included as $967 thousand within prepaid expenses and $1,611 thousand within other current assets and other non- current assets and liabilities. Warranty reserves of $442 thousand was originally included within accrued liabilities. Additionally, within our unaudited condensed consolidated balance sheets as of December 31, 2018, $652 thousand of the current portion of financing lease liabilities has been combined with accrued liabilities.

Transition of airline models

- The accounting treatment for one of our airline agreements transitioned from our turnkey model to our airline-directed model in January 2018 due to specific provisions elected by the airline that resulted in the transfer of control of the previously installed connectivity equipment. Upon transition to the airline-directed model, the net book value of all previously delivered equipment classified within property and equipment was reclassified to cost of equipment revenue. Additionally, the unamortized proceeds previously received for equipment and classified within current and non-current deferred airborne lease incentives were eliminated and included as part of estimated contract value, which was then allocated amongst the various performance obligations under the agreement. The value allocated to previously delivered equipment was immediately recognized as equipment revenue in our unaudited condensed consolidated financial statements; refer to Note 3, “Revenue Recognition,” for additional disclosures relating to the allocation of consideration among identified performance obligations. For amounts recognized in equipment revenue that were in excess of the amounts billed, we recorded current and non-current contract assets included within prepaid expenses and other current assets and other non-current assets, respectively; refer to Note 3, “Revenue Recognition,” for additional details. In connection with the transition of this airline agreement to the airline-directed model, we also established warranty reserves related to previously sold equipment that are still under a warranty period, which is in

cluded within accrued liabilities. See Note 8, “Warranties,” for additional information. This transition from the turnkey model to the airline-directed model occurred on January 4, 2018 and

the total financial statement effect on our unaudited condensed consolidated balance sheet and unaudited condensed consolidated statement of operations was as follows (

in thousands

	Increase (decrease)
Unaudited condensed consolidated balance sheet
Prepaid expense and other current assets	$	6,603
Property and equipment, net		(32,716	)
Other non-current assets		18,783
Accrued liabilities		2,000
Current deferred airborne lease incentive		(13,592	)
Non-current deferred airborne lease incentive		(17,289	)
Unaudited condensed consolidated statement of operations
Equipment revenue		45,396
Cost of equipment revenue		23,845

As of January 1, 2019,

one airline transitioned from the airline-directed model to the turnkey model. As a result of such transition,

46.8

million of Inventory was reclassified to Property and equipment, net as of January 1, 2019. See Note 2, “Summary of Significant Accounting Policies - Inventories,” in our 2018 10-K for information regarding the allocation of airborne equipment between Inventories and Property and equipment, net.

Use of Estimates

- The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates the significant estimates and bases such estimates on historical experience and on various other assumptions believed to be reasonable under the circumstances. However, actual results could differ materially from those estimates.

Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2019

Accounting Changes and Error Corrections [Abstract]

Recent Accounting Pronouncements

Accounting standards adopted:

On January 1, 2019, we adopted Accounting Standards Codification Topic 842,

Leases

(“ASC 842”) using the cumulative effect method. As a result, we recognized the cumulative effect of initially applying ASC 842 as an adjustment to the opening balance of retained earnings as of January 1, 2019. Our historical financial statements have not been restated and continue to be reported under the lease accounting standard in effect for those periods.

elected the practical expedients regarding use of hindsight to evaluate lease terms as well as maintaining lease classifications established under the prior lease accounting standard. Through this practical expedient, we did not reevaluate contracts to determine if they contained a lease. We did not elect the practical expedients regarding short-term leases or the separation of lease and non-lease components.

Adoption of ASC 842 had a material impact on our consolidated balance sheet through recognition of right-of-use (“ROU”) assets and operating lease liabilities. Adoption did not have a material impact on our consolidated statements of operations or our consolidated statements of cash flows and did not result in the recognition of incremental financing leases, formerly referred to as capital leases.

The discount rate used to calculate the adjustment to the opening balance was our incremental borrowing rate as of the adoption date, January 1, 2019. The cumulative effect of the adoption of ASC 842 to our unaudited condensed consolidated balance sheet as of January 1, 2019 was as follows (in thousands):

							Balances
	Balance at						with
	December 31,			Impact of			Adoption of
	2018			ASC 842			ASC 842
Assets
Operating lease right-of-use assets	$	—		$	72,188		$	72,188
Liabilities
Accrued liabilities		212,459			9,019			221,478
Non-current operating lease liabilities		—			102,440			102,440
Other non-current liabilities		80,191			(36,178	)		44,013
Equity
Accumulated deficit		(1,228,674	)		(3,093	)		(1,231,767	)

See Note 11, “Leases,” for additional information.

On January 1, 2019, we adopted ASU 2018-02,

Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income

(“ASU 2018-02”), which permits entities to reclassify tax effects stranded in accumulated other comprehensive income as a result of tax reform to retained earnings. Adoption of this standard did not have a material impact on our consolidated financial statements.

On January 1, 2019, we adopted ASU 2018-07,

Improvements to Nonemployee Share-Based Payment Accounting

(“ASU 2018-07”), which expands the scope of ASC 718,

Compensation – Stock Compensation

, to include share-based payment transactions for acquiring goods or services from nonemployees. Adoption of this standard did not have a material impact on our consolidated financial statements.

Revenue Recognition

3 Months Ended

Mar. 31, 2019

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Arrangements with commercial airlines

For CA-NA and CA-ROW, pursuant to contractual agreements with our airline partners, we place our equipment on commercial aircraft operated by the airlines in order to deliver our service to passengers on the aircraft. We currently have two types of commercial airline arrangements: turnkey and airline-directed. Under the airline-directed model, we have transferred control of the equipment to the airline and therefore the airline is our customer in these transactions. Under the turnkey model, we have not transferred control of our equipment to our airline partner and, as a result, the airline passenger is deemed to be our customer. Transactions with our airline partners under the turnkey model are accounted for as an operating lease of space on an aircraft. See Note 11, “Leases,” for additional information on the turnkey model.

Remaining performance obligations

As of March 31, 2019, the aggregate amount of the transaction price in our contracts allocated to the remaining unsatisfied performance obligations is approximately $831 million, most of which relates to our commercial aviation contracts. Approximately $114 million represents future equipment revenue that is expected to be recognized within the next one to three years. The remaining $717 million primarily represents connectivity and entertainment service revenues which are recognized as services are provided, which is expected to occur through the remaining term of the contract (approximately 5-10 years). We have excluded from this amount: all variable consideration derived from our connectivity or entertainment services that is allocated entirely to our performance of obligations related to such services; consideration from contracts that have an original duration of one year or less; revenue from passenger service on airlines operating under the turnkey model; and revenue from contracts that have been executed but under which have not yet met the accounting definition of a contract since the airline has not yet determined which products in our portfolio it wishes to select, and, as a result we are unable to determine which products and services will be transferred to the customer.

Disaggregation of revenue

The following table presents our revenue disaggregated by category

(in thousands)

	For the Three Months Ended
	March 31, 2019
	CA-NA		CA-ROW		BA		Total
Service revenue
Connectivity	$	79,818	$	18,854	$	52,685	$	151,357
Entertainment, CAS and other		12,209		918		528		13,655
Total service revenue	$	92,027	$	19,772	$	53,213	$	165,012
Equipment revenue
ATG	$	2,872	$	—	$	11,335	$	14,207
Satellite		630		13,159		5,235		19,024
Other		540		—		766		1,306
Total equipment revenue	$	4,042	$	13,159	$	17,336	$	34,537
Customer type
Airline passenger and aircraft owner/operator	$	54,349	$	5,851	$	53,213	$	113,413
Airline, OEM and aftermarket dealer		30,913		25,491		17,336		73,740
Third party		10,807		1,589		—		12,396
Total revenue	$	96,069	$	32,931	$	70,549	$	199,549

	For the Three Months Ended
	March 31, 2018
	CA-NA		CA-ROW		BA		Total
Service revenue
Connectivity	$	82,040	$	13,649	$	47,392	$	143,081
Entertainment, CAS and other		6,743		596		258		7,597
Total service revenue	$	88,783	$	14,245	$	47,650	$	150,678
Equipment revenue
ATG (1)	$	44,762	$	—	$	15,421	$	60,183
Satellite (1)		10,276		4,924		4,258		19,458
Other		—		—		1,506		1,506
Total equipment revenue	$	55,038	$	4,924	$	21,185	$	81,147
Customer type
Airline passenger and aircraft owner/operator	$	52,924	$	4,729	$	47,650	$	105,303
Airline, OEM and aftermarket dealer (2)		77,426		12,694		21,185		111,305
Third party		13,471		1,746		—		15,217
Total revenue	$	143,821	$	19,169	$	68,835	$	231,825

ATG and satellite equipment revenue for the CA-NA segment includes the $45.4 million related to the accounting impact of the transition of one of our airline partners to the airline-directed model. Approximately $43.4 million was included in ATG equipment revenue and approximately $2.0 million was included in satellite equipment revenue.

Airline, OEM and aftermarket dealer revenue includes all equipment revenue for our three segments, including the $45.4 million accounting impact of the transition of one of our airline partners to the airline-directed model.

Contract balances

Our current and non-current deferred revenue balances totaled $62.3 million and $60.1 million as of March 31, 2019 and December 31, 2018, respectively. Deferred revenue includes, among other things, equipment, multi-pack and subscription connectivity products, sponsorship activities and airline-directed connectivity and entertainment.

Our current and non-current contract asset balances totaled $66.4 million and $59.9 million as of March 31, 2019 and December 31, 2018, respectively. Contract assets represent the aggregate amount of revenue recognized in excess of billings for our airline-directed contracts.

Capitalized STC balances for our airline-directed contracts were $16.3 million and $16.5 million as of March 31, 2019 and December 31, 2018, respectively. We recognized $0.3 million and $0.2 million, respectively, of deferred STC costs as part of our engineering, design and development costs in our unaudited condensed consolidated statements of operations during the three month periods ended March 31, 2019 and 2018.

Net Loss Per Share

3 Months Ended

Mar. 31, 2019

Earnings Per Share [Abstract]

Net Loss Per Share

Basic and diluted net loss per share have been calculated using the weighted average number of common shares outstanding for the period.

The shares of common stock effectively repurchased in connection with the Forward Transactions (as defined and described in Note 9, “Long-Term Debt and Other Liabilities”) are considered participating securities requiring the two-class method to calculate basic and diluted earnings per share. Net earnings in future periods will be allocated between common shares and participating securities. In periods of a net loss, the shares associated with the Forward Transactions will not receive an allocation of losses, as the counterparties to the Forward Transactions are not required to fund losses. Accordingly, the calculation of weighted average shares outstanding as of March 31, 2019 and 2018 excludes approximately 7.2 million shares that will be repurchased as a result of the Forward Transactions.

As a result of the net loss for the three month periods ended March 31, 2019 and 2018, all of the outstanding shares of common stock underlying stock options, deferred stock units and restricted stock units were excluded from the computation of diluted shares outstanding because they were anti-dilutive.

The following table sets forth the computation of basic and diluted earnings per share for the three month periods ended March 31, 2019 and 2018; however, because of the undistributed losses, the shares of common stock associated with the Forward Transactions are excluded from the computation of basic earnings per share in 2019 and 2018 as undistributed losses are not allocated to these shares (

in thousands, except per share amounts

	For the Three Months
	Ended March 31,
	2019			2018
Net loss	$	(16,799	)	$	(27,419	)
Less: Participation rights of the Forward Transactions		—			—
Undistributed losses	$	(16,799	)	$	(27,419	)
Weighted-average common shares outstanding-basic and diluted		80,446			79,696
Net loss attributable to common stock per share-basic and diluted	$	(0.21	)	$	(0.34	)

Inventories

3 Months Ended

Mar. 31, 2019

Inventory Disclosure [Abstract]

Inventories

Inventories consist primarily of telecommunications systems and parts and are recorded at the lower of cost (average cost) or market. We evaluate the need for write-downs associated with obsolete, slow-moving and nonsalable inventory by reviewing net realizable inventory values on a periodic basis.

Inventories as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Work-in-process component parts	$	29,043	$	30,340
Finished goods (1)		118,311		162,705
Total inventory	$	147,354	$	193,045

(1)	The change between March 31, 2019 and December 31, 2018 primarily relates to the accounting impact of one of our airline partner agreements transitioning to the turnkey model (see Note 1, “Basis of Presentation,” for additional information).

Composition of Certain Balance Sheet Accounts

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Composition of Certain Balance Sheet Accounts

Prepaid expenses and other current assets as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Contract assets	$	10,852	$	10,423
Prepaid satellite services		7,170		7,755
Restricted cash		1,535		1,535
Other		12,583		14,982
Total prepaid expenses and other current assets	$	32,140	$	34,695

Property and equipment as of March 31, 2019 and December 31, 2018 were as follows (

in thousands


	March 31,			December 31,
	2019			2018
Office equipment, furniture, fixtures and other	$	52,637		$	52,320
Leasehold improvements		44,839			44,838
Airborne equipment (1)		715,055			642,151
Network equipment		210,044			205,463
		1,022,575			944,772
Accumulated depreciation		(457,090	)		(432,905	)
Total property and equipment, net	$	565,485		$	511,867

(1)	The change between March 31, 2019 and December 31, 2018 primarily relates to the accounting impact of one of our airline partner agreements transitioning to the turnkey model (see Note 1, “Basis of Presentation,” for additional information).

Other non-current assets as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Contract assets	$	55,536	$	49,517
Deferred STC costs		16,289		16,453
Restricted cash		5,426		5,426
Other		9,082		12,816
Total other non-current assets	$	86,333	$	84,212

Accrued liabilities as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Employee compensation and benefits	$	13,437	$	19,463
Airborne equipment and installation costs		17,625		25,119
Airline related accrued liabilities		41,609		45,077
Accrued interest		27,180		46,694
Accrued satellite network costs		14,989		19,557
Warranty reserve		11,750		12,291
Operating leases (1)		11,585		—
Other		44,892		44,910
Total accrued liabilities	$	183,067	$	213,111

(1)

The change between

March 31, 2019 and December 31, 2018 is due to the adoption of ASC 842. See Note 2, “Recent Accounting Pronouncements,” for additional information.

Other non-current liabilities as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Deferred revenue	$	24,709	$	21,482
Deferred rent (1)		—		35,897
Asset retirement obligations		9,945		9,696
Deferred tax liabilities		2,206		2,162
Other		10,696		10,954
Total other non-current liabilities	$	47,556	$	80,191

(1)

The change between

March 31, 2019 and December 31, 2018 is due to the adoption of ASC 842. See Note 2, “Recent Accounting Pronouncements,” for additional information.

Intangible Assets

3 Months Ended

Mar. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Our intangible assets are comprised of both indefinite-lived and finite-lived intangible assets. Intangible assets with indefinite lives and goodwill are not amortized; rather, they are reviewed for impairment at least annually or whenever events or circumstances indicate the carrying value of the asset may not be recoverable. We perform our annual impairment tests of our indefinite-lived intangible assets and goodwill during the fourth quarter of each fiscal year. We also reevaluate the useful life of indefinite-lived intangible assets each reporting period to determine whether events and circumstances continue to support an indefinite useful life. The results of our annual indefinite-lived intangible assets and goodwill impairment assessments in the fourth quarter of 2018 indicated no impairment.

As of both March 31, 2019 and December 31, 2018, our goodwill balance, all of which related to our BA segment, was $0.6 million.

Our intangible assets, other than goodwill, as of March 31, 2019 and December 31, 2018 were as follows (

in thousands, except for weighted average remaining useful life

	Weighted
	Average		As of March 31, 2019							As of December 31, 2018
	Remaining		Gross					Net		Gross					Net
	Useful Life		Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying
	(in years)		Amount		Amortization			Amount		Amount		Amortization			Amount
Amortized intangible assets:
Software		2.7	$	169,306	$	(121,933	)	$	47,373	$	164,580	$	(116,873	)	$	47,707
Service customer relationship		1.1		8,081		(7,058	)		1,023		8,081		(6,804	)		1,277
Other intangible assets		7.8		3,000		(1,411	)		1,589		3,000		(1,396	)		1,604
OEM and dealer relationships				6,724		(6,724	)		—		6,724		(6,724	)		—
Total amortized intangible assets				187,111		(137,126	)		49,985		182,385		(131,797	)		50,588
Unamortized intangible assets:
FCC Licenses				32,283		—			32,283		32,283		—			32,283
Total intangible assets			$	219,394	$	(137,126	)	$	82,268	$	214,668	$	(131,797	)	$	82,871

Amortization expense was $5.3 million and $7.6 million, respectively, for the three month periods ended March 31, 2019 and 2018.

Amortization expense for each of the next five years and thereafter is estimated to be as follows (

in thousands

	Amortization
Years ending December 31,	Expense
2019 (period from April 1 to December 31)	$	16,775
2020	$	15,915
2021	$	11,061
2022	$	4,230
2023	$	1,090
Thereafter	$	914

Actual future amortization expense could differ from the estimated amount as a result of future investments and other factors.

Warranties

3 Months Ended

Mar. 31, 2019

Guarantees and Product Warranties [Abstract]

Warranties

We provide warranties on parts and labor related to our products. Our warranty terms range from two to ten years. Warranty reserves are established for costs that are estimated to be incurred after the sale, delivery and installation of the products under warranty. The warranty reserves are determined based on known product failures, historical experience and other available evidence, and are included in accrued liabilities in our unaudited condensed consolidated balance sheets. Our warranty reserve balance was $11.8 million and $12.3 million, respectively, as of March 31, 2019 and December 31, 2018.

Long-Term Debt and Other Liabilities

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Long-Term Debt and Other Liabilities

Long-term debt as of March 31, 2019 and December 31, 2018 was as follows (

in thousands

	March 31,			December 31,
	2019			2018
2022 Senior Secured Notes	$	701,910		$	702,670
2022 Convertible Notes		193,012			190,083
2020 Convertible Notes		151,800			149,195
Total debt		1,046,722			1,041,948
Less deferred financing costs		(16,363	)		(17,055	)
Total long-term debt	$	1,030,359		$	1,024,893

2022 Senior Secured Notes

– On June 14, 2016 (the “Issue Date”), Gogo Intermediate Holdings LLC (“GIH”) (a wholly owned subsidiary of Gogo Inc.) and Gogo Finance Co. Inc. (a wholly owned subsidiary of GIH) (the “Co-Issuer” and, together with GIH, the “Issuers”), issued $525 million aggregate principal amount of 12.500% senior secured notes due 2022 (the “Original 2022 Senior Secured Notes”) under an Indenture, dated as of June 14, 2016 (the “Original Indenture”), among the Issuers, us, as guarantor, certain subsidiaries of GIH, as guarantors (the “Subsidiary Guarantors” and, together with us, the “Guarantors”), and U.S. Bank National Association, as trustee (in such capacity, the “Trustee”) and as collateral agent (in such capacity, the “Collateral Agent”). On January 3, 2017, the Issuers issued $65 million aggregate principal amount of additional 12.500% senior secured notes due 2022 (the “January 2017 Additional Notes”). The January 2017 Additional Notes were issued at a price equal to 108% of their face value resulting in gross proceeds of $70.2 million. On September 20, 2017, the Issuers, the Guarantors and the Trustee entered into the first supplemental indenture (the “Supplemental Indenture” and, together with the Original Indenture, the “Indenture”) to modify certain covenants, as discussed below. On September 25, 2017, the Issuers issued $100 million aggregate principal amount of additional 12.500% senior secured notes due 2022 (the “September 2017 Additional Notes”). The September 2017 Additional Notes were issued at a price equal to 113% of their face value resulting in gross proceeds of $113.0 million. Additionally, we received approximately $2.9 million for interest that accrued from July 1, 2017 through September 24, 2017, which was paid in our January 2018 interest payment. We refer to the Original 2022 Senior Secured Notes, the January 2017 Additional Notes and the September 2017 Additional Notes collectively as the “2022 Senior Secured Notes.”

As noted above, on September 20, 2017, the Issuers, the Guarantors and the Trustee entered into the Supplemental Indenture to (i) increase the amount of additional secured indebtedness under Credit Facilities (as defined in the Indenture) that may be incurred by the Issuer and its Restricted Subsidiaries (as defined in the Indenture) under the Indenture by $100 million (from $75 million to $175 million in aggregate principal amount), (ii) permit the Issuer and its Restricted Subsidiaries to incur additional secured indebtedness in connection with vendor financing arrangements not to exceed $50 million in aggregate principal amount at any time outstanding and (iii) permit the Issuer and its Restricted Subsidiaries to make additional dividends or distributions to Gogo in an aggregate amount of up to $15 million during any twelve-month period to pay interest on any indebtedness or preferred stock with a maturity later than July 1, 2022. The Supplemental Indenture became effective immediately upon execution, following our receipt of consents from holders of a majority of the outstanding principal amount of the Existing Notes (excluding Existing Notes held by the Issuers or any affiliates of the Issuers) to the Supplemental Indenture and amendments to the collateral agency agreement governing the 2022 Senior Secured Notes (the “Consent Solicitation”). In connection with the Consent Solicitation, GIH paid $1.4 million in fees (“Consent Fees”) to holders of Existing Notes who validly tendered (and did not revoke) their consents prior to the expiration of the Consent Solicitation.

As of March 31, 2019 and December 31, 2018, the outstanding principal amount of the 2022 Senior Secured Notes was $690.0 million and $690.0 million, respectively, the unamortized debt premium and Consent Fees were $11.9 million and $12.7 million, respectively, and the net carrying amount was $701.9 million and $702.7 million, respectively.

Interest on the 2022 Senior Secured Notes accrues at the rate of 12.500% per annum and is payable

semi-annually

in arrears on January 1 and July 1, interest payments commenced on January 1, 2017 (other than the January 2017 Additional Notes, for which interest payments commenced on July 1, 2017, and the September 2017 Additional Notes, for which interest payments commenced on January 1, 2018). The 2022 Senior Secured Notes mature on July 1, 2022. The January 2017 Additional Notes and September 2017 Additional Notes have the same terms as the Original 2022 Senior Secured Notes, except with respect to the issue date and issue price, and are treated as a single series for all purposes under the Indenture and the security documents that govern the 2022 Senior Secured Notes.

We paid approximately $11.4 million, $2.0 million and $2.5 million, respectively, of aggregate origination fees and financing costs related to the issuance of the Original 2022 Senior Secured Notes, the January 2017 Additional Notes and the September 2017 Additional Notes, which have been accounted for as deferred financing costs. Additionally, as noted above, we paid approximately $1.4 million of Consent Fees, which partially offset the net carrying value of the 2022 Senior Secured Notes. The deferred financing costs on our unaudited condensed consolidated balance sheet are being amortized over the contractual term of the 2022 Senior Secured Notes using the effective interest method. Total amortization expense was $0.8 million and $0.6 million, respectively, for the three month periods ended March 31, 2019 and 2018. As of March 31, 2019 and December 31, 2018, the balance of unamortized deferred financing costs related to the 2022 Senior Secured Notes was $9.3 million and $10.0 million, respectively, and is included as a reduction to long-term debt in our unaudited condensed consolidated balance sheet. See Note 10, “Interest Costs,” for additional information.

The 2022 Senior Secured Notes are the senior secured indebtedness of the Issuers and are:

•

effectively senior to all of the Issuers’ existing and future senior unsecured indebtedness and the Issuers’ indebtedness secured on a junior priority basis by the same collateral securing the 2022 Senior Secured Notes, if any, in each case to the extent of the value of the collateral securing the 2022 Senior Secured Notes;

•

effectively senior in right of payment to all of the Issuers’ future indebtedness that is subordinated in right of payment to the 2022 Senior Secured Notes;

•

effectively equal in right of payment with the Issuers’ existing and future (i) unsecured indebtedness that is not subordinated in right of payment to the 2022 Senior Secured Notes and (ii) indebtedness secured on a junior priority basis by the same collateral securing the 2022 Senior Secured Notes, if any, in each case to the extent of any insufficiency in the collateral securing the 2022 Senior Secured Notes;

•

structurally senior to all of our existing and future indebtedness, including our Convertible Notes (as defined below); and

•

structurally subordinated to all of the indebtedness and other liabilities of any non-Guarantors (other than the Issuers).

The 2022 Senior Secured Notes are guaranteed, on a senior secured basis, by us and all of GIH’s existing and future domestic restricted subsidiaries (other than the Co-Issuer), subject to certain exceptions. The Issuers’ obligations under the 2022 Senior Secured Notes are not guaranteed by Gogo International Holdings LLC, a subsidiary of ours that holds no material assets other than equity interests in our foreign subsidiaries. Each guarantee is a senior secured obligation of such Guarantor and is:

•

effectively senior to all of such Guarantor’s existing and future senior unsecured indebtedness and such Guarantor’s indebtedness secured on a junior priority basis by the same collateral, if any, securing the guarantee of such Guarantor, in each case to the extent of the value of the collateral securing such guarantee;

•

effectively senior in right of payment to all of such Guarantor’s future indebtedness that is subordinated in right of payment to such Guarantor’s guarantee;

•

effectively equal in right of payment with all of such Guarantor’s existing and future (i) unsecured indebtedness that is not subordinated in right of payment to such Guarantor’s guarantee, and (ii) indebtedness secured on a junior priority basis by the same collateral, if any, securing the guarantee of such Guarantor, in each case to the extent of any insufficiency in the collateral securing such guarantee; and

•

structurally subordinated to all indebtedness and other liabilities of any non-Guarantor subsidiary of such Guarantor (excluding, in the case of our guarantee, the Issuers).

The 2022 Senior Secured Notes and the related guarantees are secured by first-priority liens, subject to permitted liens, on substantially all of the Issuers’ and the Guarantors’ assets, except for certain excluded assets, including pledged equity interests of the Issuers and all of our existing and future domestic restricted subsidiaries guaranteeing the 2022 Senior Secured Notes.

The security interests in certain collateral may be released without the consent of holders of the 2022 Senior Secured Notes, if such collateral is disposed of in a transaction that complies with the Indenture and related security agreements. In addition, under certain circumstances, we and the Guarantors have the right to transfer certain intellectual property assets that on the Issue Date constitute collateral securing the 2022 Senior Secured Notes or the guarantees to a restricted subsidiary organized under the laws of Switzerland, resulting in the release of such collateral without consent of the holders of the 2022 Senior Secured Notes.

On or after July 1, 2019, the Issuers may, at their option, at any time or from time to time, redeem any of the 2022 Senior Secured Notes in whole or in part. The 2022 Senior Secured Notes will be redeemable at the following redemption prices (expressed in percentages of principal amount), plus accrued and unpaid interest, if any, to (but not including) the redemption date (subject to the right of holders of record on the relevant regular record date on or prior to the redemption date to receive interest due on an interest payment date), if redeemed during the twelve-month period commencing on July 1 of the following years:

	Redemption
Year	Price
2019		106.250	%
2020		103.125	%
2021 and thereafter		100.000	%

In addition, at any time prior to July 1, 2019, the Issuers may redeem up to 35% of the aggregate principal amount of the 2022 Senior Secured Notes with the proceeds of certain equity offerings at a redemption price of 112.500% of the principal amount redeemed, plus accrued and unpaid interest, if any, to (but not including) the date of redemption;

provided, however

that 2022 Senior Secured Notes representing at least 65% of the principal amount of the 2022 Senior Secured Notes remain outstanding immediately after each such redemption.

The Issuers may redeem the 2022 Senior Secured Notes, in whole or in part, at any time prior to July 1, 2019, at a redemption price equal to 100% of the principal amount of the 2022 Senior Secured Notes redeemed plus the make-whole premium set forth in the Indenture as of, and accrued and unpaid interest, if any, to (but not including) the applicable redemption date.

The Indenture contains covenants that, among other things, limit the ability of the Issuers and the Subsidiary Guarantors and, in certain circumstances, our ability, to: incur additional indebtedness; pay dividends, redeem stock or make other distributions; make investments; create restrictions on the ability of our restricted subsidiaries to pay dividends to the Issuers or make other intercompany transfers; create liens; transfer or sell assets; merge or consolidate; and enter into certain transactions with the Issuers’ affiliates, including us. Most of these covenants will cease to apply if, and for as long as, the 2022 Senior Secured Notes have investment grade ratings from both Moody’s Investment Services, Inc. and Standard & Poor’s.

If we or the Issuers undergo specific types of change of control prior to July 1, 2022, GIH is required to make an offer to repurchase for cash all of the 2022 Senior Secured Notes at a repurchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to (but not including) the payment date.

The Indenture provides for events of default, which, if any of them occur, would permit or require the principal, premium, if any, and interest on all of the then outstanding 2022 Senior Secured Notes issued under the Indenture to be due and payable immediately. As of March 31, 2019, no event of default had occurred.

On April 15, 2019, the Issuers elected to call for redemption in full all $690.0

million aggregate principal amount outstanding of the 2022 Senior Secured Notes in accordance with the terms of the Indenture (the “Redemption”). The Redemption was conditioned, among other things, upon the incurrence of indebtedness in connection with the offering of the 2024 Senior Secured Notes (as defined below) or from one or more other sources, in an amount satisfactory to the Issuers. On April 25, 2019, the Issuers irrevocably deposited or caused to be irrevocably deposited with the Trustee, solely for the benefit of the holders of the 2022 Senior Secured Notes, cash in an amount sufficient to pay principal, premium and accrued interest on the 2022 Senior Secured Notes to, but not including, the date of redemption and all other sums payable under the Indenture. The Trustee executed and delivered, among other documents, an acknowledgement of satisfaction, discharge and release, dated as of April 25, 2019, with respect to the satisfaction and discharge of the 2022 Senior Secured Notes. The 2022 Senior Secured Notes will be redeemed on May 15, 2019 at a redemption price equal to

100% of the principal amount of the 2022 Senior Secured Notes to be redeemed plus a make-whole premium and accrued and unpaid interest to, but not including, the redemption date.

2024 Senior Secured Notes

- On April 25, 2019, the Issuers issued $905 million aggregate principal amount of 9.875%

senior secured notes due 2024 (the “Initial Notes”) under an indenture, dated as of April 25, 2019, among the Issuers, us, as guarantor, certain subsidiaries of GIH, as guarantors (the “2024 Subsidiary Guarantors” and, together with us, the “2024 Guarantors”), and U.S. Bank National Association, as trustee (the “Trustee”) and collateral agent (the “Base Indenture”). On May 3, 2019, the Issuers, the 2024 Guarantors and the Trustee entered into the first supplemental indenture (the “First Supplemental Indenture” and together with the Base Indenture, the “2024 Indenture”) to increase the amount of indebtedness under Credit Facilities (as defined in the 2024 Indenture) that may be incurred by GIH or its subsidiaries acting as 2024 Guarantors by $20 million in aggregate principal amount. On May 7, 2019, the Issuers issued an additional $20 million aggregate principal amount of their 9.875% senior secured notes due 2024 (the “Additional Notes”). We refer to the Initial Notes and the Additional Notes collectively as the “2024 Senior Secured Notes”. The 2024 Senior Secured Notes are guaranteed on a senior secured basis by Gogo Inc. and all of GIH’s existing and future restricted subsidiaries (other than the Co-Issuer), subject to certain exceptions. The 2024 Senior Secured Notes and the related guarantees are secured by first-priority liens (subject to certain exceptions) on substantially all of the Issuers’ and the 2024 Guarantors’ assets, including pledged equity interests of the Issuers and all of GIH’s existing and future restricted subsidiaries guaranteeing the 2024 Senior Secured Notes, except for certain excluded assets and subject to permitted liens.

The 2024 Senior Secured Notes will mature on

May 1, 2024

. The 2024 Senior Secured Notes bear interest at a rate of 9.875% per year, payable

semiannually

in arrears on May 1 and November 1 of each year, beginning on November 1, 2019.

The

Issuers used a portion of the net proceeds from the issuance of the Initial Notes to fund the redemption of all of the outstanding 2022 Senior Secured Notes. The Issuers intend to use the remaining net proceeds from the issuance of the Initial Notes for general corporate purposes, including the repurchase, retirement or repayment of the 2020 Convertible Notes (as defined below). The Issuers intend to use the net proceeds from the issuance of the Additional Notes for general corporate purposes.

Convertible Notes

2022 Convertible Notes

On November 21, 2018, we issued $215.0 million aggregate principal amount of 6.00% Convertible Senior Notes due 2022 (the “2022 Convertible Notes”) in private offerings to qualified institutional buyers, including pursuant to Rule 144A under the Securities Act, and in concurrent private placements. We granted an option to the initial purchasers to purchase up to an additional $32.3 million aggregate principal amount of 2022 Convertible Notes to cover over-allotments, of which $22.8 million was subsequently exercised during December 2018, resulting in a total issuance of $237.8 million aggregate principal amount of 2022 Convertible Notes. The 2022 Convertible Notes mature on May 15, 2022, unless earlier repurchased or converted into shares of our common stock under certain circumstances described below. Upon maturity, we have the option to settle our obligation through cash, shares of common stock, or a combination of cash and shares of common stock. We pay interest on the 2022 Convertible Notes semi-annually in arrears on May 15 and November 15 of each year. Interest payments begin on May 15, 2019.

The $237.8 million of proceeds received from the issuance of the 2022 Convertible Notes was initially allocated between long-term debt (the liability component) at $188.7 million and additional paid-in capital (the equity component) at $49.1 million, within the consolidated balance sheet. The fair value of the liability component was measured using rates determined for similar debt instruments without a conversion feature. The carrying amount of the equity component, representing the conversion option, was determined by deducting the fair value of the liability component from the aggregate face value of the 2022 Convertible Notes. If we or the note holders elect not to settle the debt through conversion, we must settle the 2022 Convertible Notes at face value. Therefore, the liability component will be accreted up to the face value of the 2022 Convertible Notes, which will result in additional non-cash interest expense being recognized in the unaudited condensed consolidated statements of operations through the 2022 Convertible Notes maturity date (see Note 10, “Interest Costs,” for additional information). The effective interest rate on the 2022 Convertible Notes, including accretion of the notes to par and debt issuance cost amortization, was approximately 13.6%. The equity component will not be remeasured as long as it continues to meet the conditions for equity classification.

As of March 31, 2019 and December 31, 2018, the outstanding principal on the 2022 Convertible Notes was $237.8 million and $237.8 million, respectively, the unamortized debt discount was $44.7 million and $47.7 million, respectively, and the net carrying amount of the liability component was $193.0 million and $190.1 million, respectively.

We incurred approximately $8.1 million of issuance costs related to the issuance of the 2022 Convertible Notes, of which $6.4 million and $1.7 million were recorded to deferred financing costs and additional paid-in capital, respectively, in proportion to the allocation of the proceeds of the 2022 Convertible Notes. The $6.4 million recorded as deferred financing costs on our consolidated balance sheet is being amortized over the term of the 2022 Convertible Notes using the effective interest method. Total amortization expense of the deferred financing costs was $0.4 million for the three month period ended March 31, 2019. Amortization expense is included in interest expense in the unaudited condensed consolidated statements of operations. As of March 31, 2019 and December 31, 2018, the balance of unamortized deferred financing costs related to the 2022 Convertible Notes was $5.8 million and $6.2 million, respectively, and is included as a reduction to long-term debt in our consolidated balance sheets. See Note 10, “Interest Costs,” for additional information.

The 2022 Convertible Notes had an initial conversion rate of 166.6667 common shares per $1,000 principal amount of 2022 Convertible Notes, which is equivalent to an initial conversion price of approximately $6.00 per share of our common stock. Upon conversion, we currently expect to deliver cash up to the principal amount of the 2022 Convertible Notes then outstanding. With respect to any conversion value in excess of the principal amount, we currently expect to deliver shares of our common stock. We may elect to deliver cash in lieu of all or a portion of such shares. The shares of common stock subject to conversion are excluded from diluted earnings per share calculations under the if-converted method as their impact is anti-dilutive.

Holders may convert the 2022 Convertible Notes, at their option, in multiples of $1,000 principal amount at any time prior to January 15, 2022, but only in the following circumstances:

•

during any fiscal quarter beginning after the fiscal quarter ended December 31, 2018, if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during the last 30 consecutive trading days of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price of the 2022 Convertible Notes on each applicable trading day;

•

during the five business day period following any five consecutive trading day period in which the trading price for the 2022 Convertible Notes is less than 98% of the product of the last reported sale price of our common stock and the conversion rate for the 2022 Convertible Notes on each such trading day; or

•

upon the occurrence of specified corporate events.

None of the above events allowing for conversion prior to January 15, 2022 occurred during the three month period ended March 31, 2019 or the year ended December 31, 2018. Regardless of whether any of the foregoing circumstances occurs, a holder may convert its 2022 Convertible Notes, in multiples of $1,000 principal amount, at any time on or after January 15, 2022 until the second scheduled trading day immediately preceding May 15, 2022.

In addition, if we undergo a fundamental change (as defined in the indenture governing the 2022 Convertible Notes), holders may, subject to certain conditions, require us to repurchase their 2022 Convertible Notes for cash at a price equal to 100% of the principal amount of the 2022 Convertible Notes to be purchased, plus any accrued and unpaid interest. In addition, following a make-whole fundamental change, we will increase the conversion rate in certain circumstances for a holder who elects to convert its notes in connection with such make-whole fundamental change.

2020 Convertible Notes

On March 3, 2015, we issued $340.0 million aggregate principal amount of 3.75% Convertible Senior Notes due 2020 (the “2020 Convertible Notes”) in a private offering to qualified institutional buyers, pursuant to Rule 144A under the Securities Act. We granted an option to the initial purchasers to purchase up to an additional $60.0 million aggregate principal amount of 2020 Convertible Notes to cover over-allotments, of which $21.9 million was subsequently exercised during March 2015, resulting in a total issuance of $361.9 million aggregate principal amount of 2020 Convertible Notes. The 2020 Convertible Notes mature on March 1, 2020, unless earlier repurchased or converted into shares of our common stock under certain circumstances described below. Upon maturity, we have the option to settle our obligation through cash, shares of common stock, or a combination of cash and shares of common stock. We pay interest on the 2020 Convertible Notes

semi-annually

in arrears on March 1 and September 1 of each year. Interest payments began on September 1, 2015. During November 2018, we repurchased $199.9 million of outstanding principal amount of the 2020 Convertible Notes. As a result of the repurchase, the carrying value of the 2020 Convertible Notes was accreted up $17.9 million to face value.

The $361.9 million of proceeds received from the issuance of the 2020 Convertible Notes was initially allocated between long-term debt (the liability component) at $261.9 million and additional paid-in capital (the equity component) at $100.0 million, within the consolidated balance sheet. The fair value of the liability component was measured using rates determined for similar debt instruments without a conversion feature. The carrying amount of the equity component, representing the conversion option, was determined by deducting the fair value of the liability component from the aggregate face value of the 2020 Convertible Notes. If we or the note holders elect not to settle the debt through conversion, we must settle the 2020 Convertible Notes at face value. Therefore, the liability component will be accreted up to the face value of the 2020 Convertible Notes, which will result in additional non-cash interest expense being recognized in the unaudited condensed consolidated statements of operations through the 2020 Convertible Notes maturity date (see Note 10, “Interest Costs,” for additional information). The effective interest rate on the 2020 Convertible Notes, including accretion of the notes to par and debt issuance cost amortization, was approximately 11.5%. The equity component will not be remeasured as long as it continues to meet the conditions for equity classification.

As of March 31, 2019 and December 31, 2018, the outstanding principal on the 2020 Convertible Notes was $162.0 million and $162.0 million, respectively, the unamortized debt discount was $10.2 million and $12.8 million, respectively, and the net carrying amount of the liability component was $151.8 million and $149.2 million, respectively.

We incurred approximately $10.4 million of issuance costs related to the issuance of the 2020 Convertible Notes, of which $7.5 million and $2.9 million were recorded to deferred financing costs and additional paid-in capital, respectively, in proportion to the allocation of the proceeds of the 2020 Convertible Notes. The $7.5 million recorded as deferred financing costs on our consolidated balance sheet is being amortized over the term of the 2020 Convertible Notes using the effective interest method. Total amortization expense of the deferred financing costs was $0.2 million and $0.4 million, respectively, for the three month periods ended March 31, 2019 and 2018. Amortization expense is included in interest expense in the unaudited condensed consolidated statements of operations. As of March 31, 2019 and December 31, 2018, the balance of unamortized deferred financing costs related to the 2020 Convertible Notes was $0.7 million and $0.9 million, respectively, and is included as a reduction to long-term debt in our consolidated balance sheets. See Note 10, “Interest Costs,” for additional information.

The 2020 Convertible Notes had an initial conversion rate of 41.9274 common shares per $1,000 principal amount of 2020 Convertible Notes, which is equivalent to an initial conversion price of approximately $23.85 per share of our common stock. Upon conversion, we currently expect to deliver cash up to the principal amount of the 2020 Convertible Notes then outstanding. With respect to any conversion value in excess of the principal amount, we currently expect to deliver shares of our common stock. We may elect to deliver cash in lieu of all or a portion of such shares. The shares of common stock subject to conversion are excluded from diluted earnings per share calculations under the if-converted method as their impact is anti-dilutive.

Holders may convert the 2020 Convertible Notes, at their option, in multiples of $1,000 principal amount at any time prior to December 1, 2019, but only in the following circumstances:

•

during any fiscal quarter beginning after the fiscal quarter ended June 30, 2015, if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during the last 30 consecutive trading days of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price of the 2020 Convertible Notes on each applicable trading day;

•

during the five business day period following any five consecutive trading day period in which the trading price for the 2020 Convertible Notes is less than 98% of the product of the last reported sale price of our common stock and the conversion rate for the 2020 Convertible Notes on each such trading day; or

•

upon the occurrence of specified corporate events.

None of the above events allowing for conversion prior to December 1, 2019 occurred during the three month period ended March 31, 2019 or the year ended December 31, 2018. Regardless of whether any of the foregoing circumstances occurs, a holder may convert its 2020 Convertible Notes, in multiples of $1,000 principal amount, at any time on or after December 1, 2019 until maturity.

In addition, if we undergo a fundamental change (as defined in the indenture governing the 2020 Convertible Notes), holders may, subject to certain conditions, require us to repurchase their 2020 Convertible Notes for cash at a price equal to 100% of the principal amount of the 2020 Convertible Notes to be purchased, plus any accrued and unpaid interest. In addition, if specific corporate events occur prior to the maturity date, we will increase the conversion rate for a holder who elects to convert its 2020 Convertible Notes in connection with such a corporate event in certain circumstances.

On April 18, 2019, we commenced a cash tender offer (the “Tender Offer”) to purchase any and all of the outstanding 2020 Convertible Notes for an amount equal to $1,000 per $1,000 principal amount of 2020 Convertible Notes purchased, plus accrued and unpaid interest from the last interest payment date on the 2020 Convertible Notes to, but not including, the date of payment for the 2020 Convertible Notes accepted in the Tender Offer. The Tender Offer will expire at 11:59 p.m., Eastern time, on May 15, 2019, or any other date and time to which we extend such Tender Offer, unless earlier terminated. We expect to finance the payment of the purchase price for any 2020 Convertible Notes validly tendered in the Tender Offer and accepted for purchase by us with the proceeds we received from the issuance of the 2024 Senior Secured Notes and cash on hand. The Tender Offer is not conditioned upon a minimum amount of 2020 Convertible Notes being tendered and we cannot assure that the Tender Offer will be subscribed for in any amount.

Forward Transactions

In connection with the issuance of the 2020 Convertible Notes, we paid approximately $140 million to enter into prepaid forward stock repurchase transactions (the “Forward Transactions”) with certain financial institutions (the “Forward Counterparties”), pursuant to which we purchased approximately 7.2 million shares of common stock for settlement on or around the

March 1, 2020

maturity date for the 2020 Convertible Notes, subject to the ability of each Forward Counterparty to elect to settle all or a portion of its Forward Transactions early. In the future, we may request that any Forward Counterparty modify the settlement terms of its Forward Transaction to provide that, in lieu of the delivery of the applicable number of shares of our common stock to us to settle a portion of its Forward Transaction in accordance with its terms, such Forward Counterparty would pay to us the net proceeds from the sale by such Forward Counterparty (or its affiliate) of a corresponding number of shares of our common stock in a registered offering (which may include block sales, sales on the NASDAQ Global Select Market, sales in the over-the-counter market, sales pursuant to negotiated transactions or otherwise, at market prices prevailing at the time of sale or at negotiated prices). Any such sales could potentially decrease (or reduce the size of any increase in) the market price of our common stock. The Forward Counterparties are not required to effect any such settlement in cash in lieu of delivery of shares of our common stock and, if we request for any Forward Counterparty to effect any such settlement, it will be entered into in the discretion of the applicable Forward Counterparty on such terms as we may agree with such Forward Counterparty at the time. As a result of the Forward Transactions, total shareholders’ equity within our consolidated balance sheet was reduced by approximately $140 million. Approximately 7.2 million shares of common stock that will be effectively repurchased through the Forward Transactions are treated as retired shares for basic and diluted EPS purposes although they remain legally outstanding.

Restricted Cash

- Our restricted cash balances were $7.0 million and $7.0 million, respectively, as of March 31, 2019 and December 31, 2018 and primarily consist of letters of credit. Certain of the letters of credit require us to maintain restricted cash accounts in a similar amount, and are issued for the benefit of the landlords at our current office locations in Chicago, IL, Bensenville, IL and Broomfield, CO.

Leases

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Leases

11.

Leases

Operating and Financing Leases

—

We identify whether a contract contains a lease at contract inception. For leases subsequent to adoption of ASC 842, lease liabilities are calculated using a discount rate based on our incremental borrowing rate at lease commencement. We have operating lease agreements for certain facilities and equipment as well as tower space and base stations. Certain tower space leases have renewal option terms that have been deemed to be reasonably certain to be exercised. These renewal options extend a lease up to 20 years. We recognize operating lease expense on a straight-line basis over the lease term. As of March 31, 2019, there are no significant leases which have not commenced.

The following is a summary of our lease expense included in the unaudited condensed consolidated statements of operations

(in thousands)

	For the Three
	Months Ended
	March 31, 2019
Operating lease cost	$	4,918
Financing lease cost
Amortization of leased assets		205
Interest on lease liabilities		11
Total lease cost	$	5,134

Other information regarding our leases is as follows

(in thousands, except lease terms and discount rates)

	For the Three
	Months Ended
	March 31, 2019
Supplemental cash flow information
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows used in operating leases	$	6,117
Operating cash flows used in financing leases		11
Financing cash flows used in financing leases		125
Right-of-use assets obtained in exchange for lease obligations:
Operating leases		279
Weighted average remaining lease term
Operating leases		9 years
Financing leases		1 year
Weighted average discount rate
Operating leases		10.3	%
Financing leases		8.7	%

Annual future minimum lease payments as of March 31, 2019

(in thousands)

	Operating			Financing
	Leases			Leases
Years ending December 31,
2019 (period from April 1 to December 31)	$	16,966		$	550
2020		21,192			206
2021		20,870			—
2022		19,441			—
2023		15,606			—
Thereafter		76,900			—
Total future minimum lease payments		170,975			756
Less: Amount representing interest		(59,520	)		(28	)
Present value of net minimum lease payments	$	111,455		$	728
Reported as of March 31, 2019
Accrued liabilities	$	11,585		$	584
Non-current operating lease liabilities		99,870			—
Other non-current liabilities		—			144
Total lease liabilities	$	111,455		$	728

As of December 31, 2018, annual future minimum obligations for operating leases for each of the next five years and thereafter, were as follows (

in thousands

	Operating Leases
Years ending December 31,
2019	$	21,902
2020	$	19,867
2021	$	19,742
2022	$	18,420
2023	$	14,826
Thereafter	$	78,100

Arrangements with Commercial Airlines

— Pursuant to contractual agreements with our airline partners, we place our equipment on commercial aircraft operated by the airlines for the purpose of delivering our service to passengers on the aircraft. There are currently two types of commercial airline arrangements: turnkey and airline-directed.

Under the turnkey model, we account for equipment transactions as operating leases of space for our equipment on the aircraft. We may be responsible for the costs of installing and/or deinstalling the equipment. Under the turnkey model, the equipment transactions involve the transfer of legal title but do not meet sales recognition for accounting purposes because the risks and rewards of ownership are not fully transferred due to our continuing involvement with the equipment, the length of the term of our agreements with the airlines, and restrictions in the agreements regarding the airlines’ use of the equipment. Under the turnkey model, we refer to the airline as a “partner.”

Under the turnkey model, the assets are recorded as airborne equipment on our unaudited condensed consolidated balance sheets, as noted in Note 6, “Composition of Certain Balance Sheet Accounts.” Any upfront equipment payments are accounted for as lease incentives and recorded as deferred airborne lease incentives on our unaudited condensed consolidated balance sheets and are recognized as a reduction of the cost of service revenue on a straight-line basis over the term of the agreement with the airline. We recognized $9.0 million and $7.6 million, respectively, for the three month periods ended March 31, 2019 and 2018 as a reduction to our cost of service revenue in our unaudited condensed consolidated statements of operations. As of March 31, 2019, deferred airborne lease incentives of $22.7 million and $131.7 million, respectively, are included in current and non-current liabilities in our unaudited condensed consolidated balance sheet. As of December 31, 2018, deferred airborne lease incentives of $24.1 million and $129.1 million, respectively, are included in current and non-current liabilities in our unaudited condensed consolidated balance sheet. The decrease in our deferred airborne lease incentives and the amortization of the deferred airborne lease incentives relate to the accounting impact of the transition of one of our airline agreements to the airline-directed model. See Note 1, “Basis of Presentation,” for additional information.

Under the turnkey model, the revenue share paid to our airline partners represents operating lease payments. They are deemed to be contingent rental payments, as the payments due to each airline are based on a percentage of our CA-NA and CA-ROW service revenue generated from that airline’s passengers, which is unknown until realized. Therefore, we cannot estimate the lease payments due to an airline at the commencement of our contract with such airline. This rental expense is included in cost of service revenue and is partially offset by the amortization of the deferred airborne lease incentives discussed above. Such rental expenses totaled a net charge of $3.7 million and $6.4 million, respectively, for the three month periods ended March 31, 2019 and 2018. The decrease in rental expense was due to the transition of one of our airline agreements to the airline-directed model. See Note 1, “Basis of Presentation,” for additional information.

Commitments and Contingencies

3 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

12.

Commitments and Contingencies

Contractual Commitments

- We have agreements with vendors to provide us with transponder and teleport satellite services. These agreements vary in length and amount and as of March 31, 2019 commit us to purchase transponder and teleport satellite services totaling approximately $77.3 million in 2019 (April 1 through December 31), $95.2 million in 2020, $81.3 million in 2021, $67.6 million in 2022, $58.8 million in 2023 and $159.0 million thereafter.

We have agreements with various vendors under which we have remaining commitments to purchase satellite-based systems, certifications and development services. Such commitments will become payable as we receive the equipment or certifications, or as development services are provided.

A contract with one of our airline customers required us to provide the airline customer with a cash rebate of $1.8 million in June 2018, which has not yet been paid.

Damages and Penalties -

We have entered into a number of agreements with our airline partners that require us to provide a credit or pay penalties or liquidated damages to our airline partners if we are delayed in delivering our equipment, unable to install our equipment on aircraft by specified timelines or fail to comply with service level commitments. The maximum amount of future credits or payments we could be required to make under these agreements is uncertain because the amount of future credits or payments is based on certain variable inputs.

Indemnifications and Guarantees

- In accordance with Delaware law, we indemnify our officers and directors for certain events or occurrences while the officer or director is, or was, serving at our request in such capacity. The maximum potential amount of future payments we could be required to make under this indemnification is uncertain and may be unlimited, depending upon circumstances. However, our Directors’ and Officers’ insurance does provide coverage for certain of these losses.

In the ordinary course of business we may occasionally enter into agreements pursuant to which we may be obligated to pay for the failure of the performance of others, such as the use of corporate credit cards issued to employees. Based on historical experience, we believe that the risk of sustaining any material loss related to such guarantees is remote.

We have entered into a number of agreements, including our agreements with commercial airlines, pursuant to which we indemnify the other party for losses and expenses suffered or incurred in connection with any patent, copyright, or trademark infringement or misappropriation claim asserted by a third party with respect to our equipment or services. The maximum potential amount of future payments we could be required to make under these indemnification agreements is uncertain and is typically not limited by the terms of the agreements.

Linksmart Litigation

- On

April 20, 2018

, Linksmart Wireless Technology, LLC filed suit against us and eight of our airline partners in the U.S. District Court for the Central District of California alleging that our redirection server and login portal infringe a patent owned by the plaintiff. We are required under our contracts with these airlines to indemnify them for defense costs and any liabilities resulting from the suit. The Court has stayed the suits against our airline customers pending resolution of the suit against Gogo. Linksmart has also filed suit against other defendants asserting the same patent. One of these defendants has filed an inter parties review against the asserted patent and must meet a certain threshold to continue. Linksmart sought to stay the suit against Gogo until the earlier of (i) a decision by the U.S. Patent and Trade Office that the threshold for review has not been met and that the review may not continue or (ii) if the review continues, its resolution. We agreed and the court has granted our request to stay our case until the first to occur of such events. Cases against the other defendants have also been stayed pending the inter parties review. The outcome of the inter parties review and this matter overall is inherently uncertain. No amounts have been accrued for any potential losses under this matter, as we cannot reasonably predict the outcome of the litigation or any potential losses.

Securities Litigation

- On

June 27, 2018

a purported stockholder of the Company filed a putative class action lawsuit in the United States District Court for the Northern District of Illinois, Eastern Division styled Pierrelouis v. Gogo Inc., naming the Company, its former Chief Executive Officer and Chief Financial Officer and its current Chief Financial Officer and President, Commercial Aviation as defendants purportedly on behalf of all purchasers of our securities from February 27, 2017 through May 4, 2018. The complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder, alleging misrepresentations or omissions by us purporting to relate to our 2Ku antenna’s reliability and installation and remediation costs. The plaintiffs seek to recover from us and the individual defendants an unspecified amount of damages. In December 2018 the plaintiffs filed an amended complaint and in February 2019, we filed a motion to dismiss such amended complaint. In April 2019 the plaintiffs filed a response to our motion. We intend to file a reply in May 2019 at which time the motion will be submitted to the Court for a ruling. We believe that the claims are without merit and intend to defend them vigorously. In accordance with Delaware law, we will indemnify the individual named defendants for their defense costs and any damages they incur in connection with the suit. We have filed a claim with the issuer of our Directors’ and Officers’ insurance policy with respect to this suit. No amounts have been accrued for any potential losses under this matter, as we cannot reasonably predict the outcome of the litigation or any potential losses.

Derivative Litigation

- On

September 25, 2018

and September 26, 2018, two purported stockholders of the Company filed substantively identical derivative lawsuits in the United States District Court for the Northern District of Illinois, Eastern Division, styled Nanduri v. Gogo Inc. and Hutsenpiller v. Gogo Inc., respectively. Both lawsuits were purportedly brought derivatively on behalf of us and name us as a nominal defendant and name as defendants each member of the Company’s Board of Directors, its former Chief Executive Officer and Chief Financial Officer and its current Chief Executive Officer, Chief Financial Officer and President, Commercial Aviation. The complaints assert claims under Section 14(a) of the Securities Exchange Act of 1934, breach of fiduciary duty, unjust enrichment, and waste of corporate assets, and allege misrepresentations or omissions by us purporting to relate to our 2Ku antenna’s reliability and installation and remediation costs, as well as allegedly excessive bonuses, stock options, and other compensation paid to current Officers and Directors and excessive severance paid to former Officers. The two lawsuits were consolidated and are stayed pending the Court’s ruling on the motion to dismiss in the class action suit. We believe that the claims are without merit and intend to defend them vigorously. The plaintiffs seek to recover, on our behalf, an unspecified amount of damages from the individual defendants. We have filed a claim with the issuer of our Directors’ and Officers’ insurance policy with respect to these suits. No amounts have been accrued for any potential costs under this matter, as we cannot reasonably predict the outcome of the litigation or any potential costs.

Fair Value of Financial Assets and Liabilities

3 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value of Financial Assets and Liabilities

13.

Fair Value of Financial Assets and Liabilities

A three-tier fair value hierarchy has been established which prioritizes the inputs used in measuring fair value. These tiers include:

•

Level 1

- defined as observable inputs such as quoted prices in active markets;

•

Level 2

- defined as observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

•

Level 3

- defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

Long-Term Debt:

Our financial assets and liabilities that are disclosed but not measured at fair value include the 2022 Senior Secured Notes, the 2022 Convertible Notes and the 2020 Convertible Notes, which are reflected on the unaudited condensed consolidated balance sheet at cost. The fair value measurements are classified as Level 2 within the fair value hierarchy since they are based on quoted market prices of our instruments in markets that are not active. We estimated the fair value of the 2022 Senior Secured Notes, 2022 Convertible Notes and 2020 Convertible Notes by calculating the upfront cash payment a market participant would require to assume these obligations. The upfront cash payment used in the calculations of fair value on our March 31, 2019 unaudited condensed consolidated balance sheet, excluding any issuance costs, is the amount that a market participant would be willing to lend at March 31, 2019 to an entity with a credit rating similar to ours and achieve sufficient cash inflows to cover the scheduled cash outflows under the 2022 Senior Secured Notes, the 2022 Convertible Notes and the 2020 Convertible Notes. The calculated fair value of our 2022 Convertible Notes and 2020 Convertible Notes is correlated to our stock price and as a result, significant changes to our stock price could have a significant impact on their calculated fair values.

The fair value and carrying value of long-term debt as of March 31, 2019 and December 31, 2018 were as follows

(in thousands)

	March 31, 2019					December 31, 2018
	Fair Value (1)		Carrying Value			Fair Value (1)		Carrying Value
2022 Senior Secured Notes	$	745,000	$	701,910	(2)	$	737,000	$	702,670	(2)
2022 Convertible Notes		236,000		193,012	(3)		216,000		190,083	(3)
2020 Convertible Notes		157,000		151,800	(4)		150,000		149,195	(4)

(1)

Fair value amounts are rounded to the nearest million.

(2)

Carrying value of the 2022 Senior Secured Notes includes unamortized debt premium and Consent Fees of $11.9 million and $12.7 million, respectively, as of March 31, 2019 and December 31, 2018. See Note 9, “Long-Term Debt and Other Liabilities,” for further information.

(3)

Carrying value of the 2022 Convertible Notes excludes unamortized debt discount of $44.7 million and $47.7 million, respectively, as of March 31, 2019 and December 31, 2018. See Note 9, “Long-Term Debt and Other Liabilities,” for further information.

(4)

Carrying value of the 2020 Convertible Notes excludes unamortized debt discount of $10.2 million and $12.8 million, respectively, as of March 31, 2019 and December 31, 2018. See Note 9, “Long-Term Debt and Other Liabilities,” for further information.

We have held-to-maturity financial instruments where carrying value approximates fair value. There were no fair value adjustments to these financial instruments during the three month periods ended March 31, 2019 and 2018.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Income Tax

3 Months Ended

Mar. 31, 2019

Income Tax Disclosure [Abstract]

Income Tax

14.

Income Tax

The effective income tax rates for the three month periods ended March 31, 2019 and 2018 were (1.2%) and 12.0%, respectively. For the three month period ended March 31, 2019, our income tax expense was not significant primarily due to the recording of a valuation allowance against our net deferred tax assets. An income tax benefit was recorded for the three month period ended March 31, 2018 resulting from a reduction in our valuation allowance of approximately $4.0 million due to the application of provisions of H.R. 1, commonly known as the Tax Cuts and Jobs Act (“U.S. Tax Reform”), to our evaluation of our deferred tax assets.

We are subject to income taxation in the United States, various states within the United States, Canada, Switzerland, Japan, Mexico, Brazil, Singapore, the United Kingdom, Hong Kong, Australia, China, India, France, Germany and the Netherlands. With few exceptions, as of March 31, 2019, we are no longer subject to U.S. federal, state, local or foreign examinations by tax authorities for years before 2015.

We record penalties and interest relating to uncertain tax positions in the income tax provision line item in the unaudited condensed consolidated statement of operations. No penalties or interest related to uncertain tax positions were recorded for the three month periods ended March 31, 2019 and 2018. As of March 31, 2019 and December 31, 2018, we did not have a liability recorded for interest or potential penalties.

We do not expect a change in the unrecognized tax benefits within the next 12 months.

Business Segments and Major Customers

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Business Segments and Major Customers

15.

Business Segments and Major Customers

We operate our business through three operating segments: Commercial Aviation North America, or “CA-NA,” Commercial Aviation Rest of World, or “CA-ROW,” and Business Aviation, or “BA.” See Note 1, “Basis of Presentation,” for further information regarding our segments.

The accounting policies of the operating segments are the same as those described in Note 2, “Summary of Significant Accounting Policies,” in our 2018 10-K. Intercompany transactions between segments are excluded as they are not included in management’s performance review of the segments. For the three month periods ended March 31, 2019 and 2018, our foreign revenue accounted for less than 15% of our consolidated revenue. We do not segregate assets between segments for internal reporting. Therefore, asset-related information has not been presented. Additionally, assets outside of the United States totaled less than 15% of our unaudited condensed consolidated assets as of March 31, 2019 and December 31, 2018, respectively. For our airborne assets, we consider only those assets installed in aircraft associated with international commercial airline partners to be owned outside of the United States.

Management evaluates performance and allocates resources to each segment based on segment profit (loss), which is calculated internally as net income (loss) attributable to common stock before interest expense, interest income, income taxes, depreciation and amortization, certain non-cash items (including amortization of deferred airborne lease incentives, stock-based compensation expense, amortization of STC costs and the accounting impact of the transition to the airline-directed model) and other income (expense). Segment profit (loss) is a measure of performance reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and evaluating segment performance. In addition, segment profit (loss) is included herein in conformity with ASC 280-10,

Segment Reporting

. Management believes that segment profit (loss) provides useful information for analyzing and evaluating the underlying operating results of each segment. However, segment profit (loss) should not be considered in isolation or as a substitute for net income (loss) attributable to common stock or other measures of financial performance prepared in accordance with GAAP. Additionally, our computation of segment profit (loss) may not be comparable to other similarly titled measures computed by other companies.

Information regarding our reportable segments is as follows (

in thousands

	For the Three Months Ended
	March 31, 2019
	CA-NA		CA-ROW			BA		Total
Service revenue	$	92,027	$	19,772		$	53,213	$	165,012
Equipment revenue		4,042		13,159			17,336		34,537
Total revenue	$	96,069	$	32,931		$	70,549	$	199,549
Segment profit (loss)	$	23,542	$	(19,149	)	$	33,498	$	37,891

	For the Three Months Ended
	March 31, 2018
	CA-NA		CA-ROW			BA		Total
Service revenue	$	88,783	$	14,245		$	47,650	$	150,678
Equipment revenue (1)		55,038		4,924			21,185		81,147
Total revenue	$	143,821	$	19,169		$	68,835	$	231,825
Segment profit (loss)	$	1,656	$	(22,605	)	$	32,323	$	11,374

(1)

CA-NA equipment revenue for the three month period ended March 31, 2018 includes the accounting impact of the transition of one of our airline partners to the airline-directed model. See Note 1, “Basis of Presentation,” for additional information.

A reconciliation of segment profit (loss) to the relevant consolidated amounts is as follows (

in thousands

	For the Three Months
	Ended March 31,
	2019			2018
CA-NA segment profit	$	23,542		$	1,656
CA-ROW segment loss		(19,149	)		(22,605	)
BA segment profit		33,498			32,323
Total segment profit		37,891			11,374
Interest income		1,149			1,076
Interest expense		(32,554	)		(30,554	)
Depreciation and amortization		(30,749	)		(35,919	)
Transition to airline-directed model		—			19,302
Amortization of deferred airborne lease incentives (1)		8,953			7,630
Amortization of STC costs		(320	)		(172	)
Stock-based compensation expense		(4,327	)		(4,386	)
Other income		3,365			505
Loss before income taxes	$	(16,592	)	$	(31,144	)

(1)

Amortization of deferred airborne lease incentive relates to our CA-NA and CA-ROW segments. See Note 11, “Leases,” for further information.

Major Customers and Airline Partnerships

— Under the turnkey model, we refer to the airline as a “partner”, and under the airline-directed model, we refer to the airline as a “customer.”

Revenue earned from passengers on aircraft operated by Delta Air Lines accounted for approximately 29% and 20% of consolidated revenue, respectively, for the three month periods

ended March 31, 2019 and 2018. Delta Air Lines accounted for approximately 11% of consolidated accounts receivable as of March 31, 2019 and December 31, 2018.

During the three month periods ended March 31, 2019 and 2018, American Airlines accounted for approximately 10% and 36% of consolidated revenue, respectively. Revenue earned from American Airlines for the three month period ended March 31, 2018 included $45.4 million of equipment revenue recognized due to the airline’s transition to the airline-directed model in January 2018. See Note 1, “Basis of Presentation,” for additional information. American Airlines accounted for approximately

11% of consolidated accounts receivable as of December 31, 2018.

Employee Retirement and Postretirement Benefits

3 Months Ended

Mar. 31, 2019

Text Block [Abstract]

Employee Retirement and Postretirement Benefits

16. Employee Retirement and Postretirement Benefits

Stock-Based Compensation —

As of March 31, 2019, we maintained three stock-based employee compensation plans (“Stock Plans”). See Note 11, “Stock-Baaed Compensation,” in our 2018 10-K for further information regarding these plans. Most of our equity grants are awarded on an annual basis.

For the three month period ended March 31, 2019, options to purchase 1,302,928 shares of common stock (of which 148,500 are options that contain a market condition and

50,000

contain a performance condition, in addition to the time-based vesting requirements) were granted, no options to purchase shares of common stock were exercised, options to purchase 111,963 (of which 111,963 options contain a market condition) shares of common stock were forfeited, and options to purchase 5,225 shares of common stock expired.

For the three month period ended March 31, 2019, 1,946,799 Restricted Stock Units (“RSUs”) (of which 86,000 are RSUs that contain a market condition and 50,000 contain a performance condition, in addition to the time-based vesting requirements) were granted, 207,188 RSUs vested and 107,027 RSUs (of which 29,904 contained a market condition) were forfeited.

For the three month period ended March 31, 2019, 36,145 restricted shares vested. These shares are deemed issued as of the date of grant, but not outstanding until they vest.

For the three month period ended March 31, 2019, 53,448 Deferred Stock Units were granted and vested.

For the three month period ended March 31, 2019, 75,253 shares of common stock were issued under the employee stock purchase plan.

The following is a summary of our stock-based compensation expense by operating expense line in the unaudited condensed consolidated statements of operations

(in thousands)

	For the Three Months
	Ended March 31,
	2019		2018
Cost of service revenue	$	428	$	434
Cost of equipment revenue		71		54
Engineering, design and development		774		910
Sales and marketing		970		1,082
General and administrative		2,084		1,906
Total stock-based compensation expense	$	4,327	$	4,386

401(k) Plan

— Under our 401(k) plan, all employees who are eligible to participate are entitled to make tax-deferred contributions, subject to Internal Revenue Service limitations. We match 100% of the employee’s first 4% of contributions made, subject to annual limitations. Our matching contributions were $1.2 million and $1.2 million, respectively, during the three month periods ended March 31, 2019 and 2018.

Research and Development Costs

3 Months Ended

Mar. 31, 2019

Research and Development [Abstract]

Research and Development Costs

17.

Research and Development Costs

Expenditures for research and development are charged to expense as incurred and totaled $14.1 million and $19.2 million, respectively, during the three month periods ended March 31, 2019 and 2018. Research and development costs are reported as a component of engineering, design and development expenses in our unaudited condensed consolidated statements of operations.

Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Basis of Presentation

The Business

Basis of Presentation

We have one class of common stock outstanding as of March 31, 2019 and December 31, 2018.

Reclassifications

Transition to airline-directed model

Transition of airline models

cluded within accrued liabilities. See Note 8, “Warranties,” for additional information. This transition from the turnkey model to the airline-directed model occurred on January 4, 2018 and

the total financial statement effect on our unaudited condensed consolidated balance sheet and unaudited condensed consolidated statement of operations was as follows (

in thousands

	Increase (decrease)
Unaudited condensed consolidated balance sheet
Prepaid expense and other current assets	$	6,603
Property and equipment, net		(32,716	)
Other non-current assets		18,783
Accrued liabilities		2,000
Current deferred airborne lease incentive		(13,592	)
Non-current deferred airborne lease incentive		(17,289	)
Unaudited condensed consolidated statement of operations
Equipment revenue		45,396
Cost of equipment revenue		23,845

As of January 1, 2019,

one airline transitioned from the airline-directed model to the turnkey model. As a result of such transition,

46.8

Use of Estimates

Revenue Recognition (Tables)

3 Months Ended

Mar. 31, 2019

Summary of Revenue Disaggregated by Category

The following table presents our revenue disaggregated by category

(in thousands)

	For the Three Months Ended
	March 31, 2019
	CA-NA		CA-ROW		BA		Total
Service revenue
Connectivity	$	79,818	$	18,854	$	52,685	$	151,357
Entertainment, CAS and other		12,209		918		528		13,655
Total service revenue	$	92,027	$	19,772	$	53,213	$	165,012
Equipment revenue
ATG	$	2,872	$	—	$	11,335	$	14,207
Satellite		630		13,159		5,235		19,024
Other		540		—		766		1,306
Total equipment revenue	$	4,042	$	13,159	$	17,336	$	34,537
Customer type
Airline passenger and aircraft owner/operator	$	54,349	$	5,851	$	53,213	$	113,413
Airline, OEM and aftermarket dealer		30,913		25,491		17,336		73,740
Third party		10,807		1,589		—		12,396
Total revenue	$	96,069	$	32,931	$	70,549	$	199,549

	For the Three Months Ended
	March 31, 2018
	CA-NA		CA-ROW		BA		Total
Service revenue
Connectivity	$	82,040	$	13,649	$	47,392	$	143,081
Entertainment, CAS and other		6,743		596		258		7,597
Total service revenue	$	88,783	$	14,245	$	47,650	$	150,678
Equipment revenue
ATG (1)	$	44,762	$	—	$	15,421	$	60,183
Satellite (1)		10,276		4,924		4,258		19,458
Other		—		—		1,506		1,506
Total equipment revenue	$	55,038	$	4,924	$	21,185	$	81,147
Customer type
Airline passenger and aircraft owner/operator	$	52,924	$	4,729	$	47,650	$	105,303
Airline, OEM and aftermarket dealer (2)		77,426		12,694		21,185		111,305
Third party		13,471		1,746		—		15,217
Total revenue	$	143,821	$	19,169	$	68,835	$	231,825

Net Loss Per Share (Tables)

3 Months Ended

Mar. 31, 2019

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

in thousands, except per share amounts

	For the Three Months
	Ended March 31,
	2019			2018
Net loss	$	(16,799	)	$	(27,419	)
Less: Participation rights of the Forward Transactions		—			—
Undistributed losses	$	(16,799	)	$	(27,419	)
Weighted-average common shares outstanding-basic and diluted		80,446			79,696
Net loss attributable to common stock per share-basic and diluted	$	(0.21	)	$	(0.34	)

Inventories (Tables)

3 Months Ended

Mar. 31, 2019

Inventory Disclosure [Abstract]

Components of Inventories

Inventories as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Work-in-process component parts	$	29,043	$	30,340
Finished goods (1)		118,311		162,705
Total inventory	$	147,354	$	193,045

(1)	The change between March 31, 2019 and December 31, 2018 primarily relates to the accounting impact of one of our airline partner agreements transitioning to the turnkey model (see Note 1, “Basis of Presentation,” for additional information).

Composition of Certain Balance Sheet Accounts (Tables)

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Contract assets	$	10,852	$	10,423
Prepaid satellite services		7,170		7,755
Restricted cash		1,535		1,535
Other		12,583		14,982
Total prepaid expenses and other current assets	$	32,140	$	34,695

Property and Equipment

Property and equipment as of March 31, 2019 and December 31, 2018 were as follows (

in thousands


	March 31,			December 31,
	2019			2018
Office equipment, furniture, fixtures and other	$	52,637		$	52,320
Leasehold improvements		44,839			44,838
Airborne equipment (1)		715,055			642,151
Network equipment		210,044			205,463
		1,022,575			944,772
Accumulated depreciation		(457,090	)		(432,905	)
Total property and equipment, net	$	565,485		$	511,867

(1)	The change between March 31, 2019 and December 31, 2018 primarily relates to the accounting impact of one of our airline partner agreements transitioning to the turnkey model (see Note 1, “Basis of Presentation,” for additional information).

Schedule of Other Non-Current Assets

Other non-current assets as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Contract assets	$	55,536	$	49,517
Deferred STC costs		16,289		16,453
Restricted cash		5,426		5,426
Other		9,082		12,816
Total other non-current assets	$	86,333	$	84,212

Accrued Liabilities

Accrued liabilities as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Employee compensation and benefits	$	13,437	$	19,463
Airborne equipment and installation costs		17,625		25,119
Airline related accrued liabilities		41,609		45,077
Accrued interest		27,180		46,694
Accrued satellite network costs		14,989		19,557
Warranty reserve		11,750		12,291
Operating leases (1)		11,585		—
Other		44,892		44,910
Total accrued liabilities	$	183,067	$	213,111

(1)

The change between

March 31, 2019 and December 31, 2018 is due to the adoption of ASC 842. See Note 2, “Recent Accounting Pronouncements,” for additional information.

Other Non-Current Liabilities

Other non-current liabilities as of March 31, 2019 and December 31, 2018 were as follows (

in thousands

	March 31,		December 31,
	2019		2018
Deferred revenue	$	24,709	$	21,482
Deferred rent (1)		—		35,897
Asset retirement obligations		9,945		9,696
Deferred tax liabilities		2,206		2,162
Other		10,696		10,954
Total other non-current liabilities	$	47,556	$	80,191

(1)

The change between

March 31, 2019 and December 31, 2018 is due to the adoption of ASC 842. See Note 2, “Recent Accounting Pronouncements,” for additional information.

Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets, Other than Goodwill

Our intangible assets, other than goodwill, as of March 31, 2019 and December 31, 2018 were as follows (

in thousands, except for weighted average remaining useful life

	Weighted
	Average		As of March 31, 2019							As of December 31, 2018
	Remaining		Gross					Net		Gross					Net
	Useful Life		Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying
	(in years)		Amount		Amortization			Amount		Amount		Amortization			Amount
Amortized intangible assets:
Software		2.7	$	169,306	$	(121,933	)	$	47,373	$	164,580	$	(116,873	)	$	47,707
Service customer relationship		1.1		8,081		(7,058	)		1,023		8,081		(6,804	)		1,277
Other intangible assets		7.8		3,000		(1,411	)		1,589		3,000		(1,396	)		1,604
OEM and dealer relationships				6,724		(6,724	)		—		6,724		(6,724	)		—
Total amortized intangible assets				187,111		(137,126	)		49,985		182,385		(131,797	)		50,588
Unamortized intangible assets:
FCC Licenses				32,283		—			32,283		32,283		—			32,283
Total intangible assets			$	219,394	$	(137,126	)	$	82,268	$	214,668	$	(131,797	)	$	82,871

Summary of Amortization Expenses

Amortization expense for each of the next five years and thereafter is estimated to be as follows (

in thousands

	Amortization
Years ending December 31,	Expense
2019 (period from April 1 to December 31)	$	16,775
2020	$	15,915
2021	$	11,061
2022	$	4,230
2023	$	1,090
Thereafter	$	914

Long-Term Debt and Other Liabilities (Tables)

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

Long-term debt as of March 31, 2019 and December 31, 2018 was as follows (

in thousands

	March 31,			December 31,
	2019			2018
2022 Senior Secured Notes	$	701,910		$	702,670
2022 Convertible Notes		193,012			190,083
2020 Convertible Notes		151,800			149,195
Total debt		1,046,722			1,041,948
Less deferred financing costs		(16,363	)		(17,055	)
Total long-term debt	$	1,030,359		$	1,024,893

Summary of Redemption Prices Plus Accrued and Unpaid Interest

The 2022 Senior Secured Notes will be redeemable at the following redemption prices (expressed in percentages of principal amount), plus accrued and unpaid interest, if any, to (but not including) the redemption date (subject to the right of holders of record on the relevant regular record date on or prior to the redemption date to receive interest due on an interest payment date), if redeemed during the twelve-month period commencing on July 1 of the following years:

	Redemption
Year	Price
2019		106.250	%
2020		103.125	%
2021 and thereafter		100.000	%

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=114775744&loc=d3e28541-108399

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21506-112644

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=114775744&loc=d3e28551-108399

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21521-112644

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21538-112644

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=114775985&loc=d3e28878-108400

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21475-112644

+ Details

Leases (Tables)

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Lease expense included in the unaudited condensed consolidated statements of operations

The following is a summary of our lease expense included in the unaudited condensed consolidated statements of operations

(in thousands)

	For the Three
	Months Ended
	March 31, 2019
Operating lease cost	$	4,918
Financing lease cost
Amortization of leased assets		205
Interest on lease liabilities		11
Total lease cost	$	5,134

Schedule Includes Other information About Leases

Other information regarding our leases is as follows

(in thousands, except lease terms and discount rates)

	For the Three
	Months Ended
	March 31, 2019
Supplemental cash flow information
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows used in operating leases	$	6,117
Operating cash flows used in financing leases		11
Financing cash flows used in financing leases		125
Right-of-use assets obtained in exchange for lease obligations:
Operating leases		279
Weighted average remaining lease term
Operating leases		9 years
Financing leases		1 year
Weighted average discount rate
Operating leases		10.3	%
Financing leases		8.7	%

Annual future minimum lease payments

Annual future minimum lease payments as of March 31, 2019

(in thousands)

	Operating			Financing
	Leases			Leases
Years ending December 31,
2019 (period from April 1 to December 31)	$	16,966		$	550
2020		21,192			206
2021		20,870			—
2022		19,441			—
2023		15,606			—
Thereafter		76,900			—
Total future minimum lease payments		170,975			756
Less: Amount representing interest		(59,520	)		(28	)
Present value of net minimum lease payments	$	111,455		$	728
Reported as of March 31, 2019
Accrued liabilities	$	11,585		$	584
Non-current operating lease liabilities		99,870			—
Other non-current liabilities		—			144
Total lease liabilities	$	111,455		$	728

As of December 31, 2018, annual future minimum obligations for operating leases for each of the next five years and thereafter, were as follows (

in thousands

	Operating Leases
Years ending December 31,
2019	$	21,902
2020	$	19,867
2021	$	19,742
2022	$	18,420
2023	$	14,826
Thereafter	$	78,100

Fair Value of Financial Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Summary of Fair Value and Carrying Value of Long-Term Debt

The fair value and carrying value of long-term debt as of March 31, 2019 and December 31, 2018 were as follows

(in thousands)

	March 31, 2019					December 31, 2018
	Fair Value (1)		Carrying Value			Fair Value (1)		Carrying Value
2022 Senior Secured Notes	$	745,000	$	701,910	(2)	$	737,000	$	702,670	(2)
2022 Convertible Notes		236,000		193,012	(3)		216,000		190,083	(3)
2020 Convertible Notes		157,000		151,800	(4)		150,000		149,195	(4)

(1)

Fair value amounts are rounded to the nearest million.

(2)

(3)

(4)

Business Segments and Major Customers (Tables)

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Summary of Reportable Segments

Information regarding our reportable segments is as follows (

in thousands

	For the Three Months Ended
	March 31, 2019
	CA-NA		CA-ROW			BA		Total
Service revenue	$	92,027	$	19,772		$	53,213	$	165,012
Equipment revenue		4,042		13,159			17,336		34,537
Total revenue	$	96,069	$	32,931		$	70,549	$	199,549
Segment profit (loss)	$	23,542	$	(19,149	)	$	33,498	$	37,891

	For the Three Months Ended
	March 31, 2018
	CA-NA		CA-ROW			BA		Total
Service revenue	$	88,783	$	14,245		$	47,650	$	150,678
Equipment revenue (1)		55,038		4,924			21,185		81,147
Total revenue	$	143,821	$	19,169		$	68,835	$	231,825
Segment profit (loss)	$	1,656	$	(22,605	)	$	32,323	$	11,374

(1)

Reconciliation of Segment Profit (loss)

A reconciliation of segment profit (loss) to the relevant consolidated amounts is as follows (

in thousands

	For the Three Months
	Ended March 31,
	2019			2018
CA-NA segment profit	$	23,542		$	1,656
CA-ROW segment loss		(19,149	)		(22,605	)
BA segment profit		33,498			32,323
Total segment profit		37,891			11,374
Interest income		1,149			1,076
Interest expense		(32,554	)		(30,554	)
Depreciation and amortization		(30,749	)		(35,919	)
Transition to airline-directed model		—			19,302
Amortization of deferred airborne lease incentives (1)		8,953			7,630
Amortization of STC costs		(320	)		(172	)
Stock-based compensation expense		(4,327	)		(4,386	)
Other income		3,365			505
Loss before income taxes	$	(16,592	)	$	(31,144	)

(1)

Amortization of deferred airborne lease incentive relates to our CA-NA and CA-ROW segments. See Note 11, “Leases,” for further information.

Employee Retirement and Postretirement Benefits (Tables)

3 Months Ended

Mar. 31, 2019

Text Block [Abstract]

Summary of Stock-Based Compensation Expense by Operating Expense

The following is a summary of our stock-based compensation expense by operating expense line in the unaudited condensed consolidated statements of operations

(in thousands)

	For the Three Months
	Ended March 31,
	2019		2018
Cost of service revenue	$	428	$	434
Cost of equipment revenue		71		54
Engineering, design and development		774		910
Sales and marketing		970		1,082
General and administrative		2,084		1,906
Total stock-based compensation expense	$	4,327	$	4,386

Basis of Presentation - Additional Information (Detail) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2019 USD ($) Segment ClassOfCommonStock	Dec. 31, 2018 USD ($) ClassOfCommonStock	Jan. 01, 2019 USD ($)
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Property, Plant and Equipment, Net	$ 565,485	$ 511,867
Number Of Classes Of Common Stock Outstanding \| ClassOfCommonStock	1	1
Number of Operating Segments \| Segment	3
Contract with Customer, Asset, Net	$ 2,578
Prepaid Expense, Current	7,170	$ 7,755
Current Financing Lease Liabilities [Member] \| Previously Reported [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Accrued Liabilities	652
SEC Schedule, 12-09, Reserve, Warranty [Member] \| Previously Reported [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Accrued Liabilities	442
Short-term Contract with Customer [Member] \| Previously Reported [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Prepaid Expense, Current	967
Other Assets, Current	$ 1,611
Air Line Inventory [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Property, Plant and Equipment, Net			$ 46,800

Basis of Presentation - Summary of Financial Effects Due to Transition of Agreements (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Prepaid expense and other current assets	$ 32,140		$ 34,695
Property and equipment, net	(565,485)		(511,867)
Other non-current assets	86,333		84,212
Accrued liabilities	183,067		213,111
Current deferred airborne lease incentive	22,726		24,145
Non-current deferred airborne lease incentive	131,743		$ 129,086
Equipment revenue	199,549	$ 231,825
Cost of equipment revenue	29,731	$ 52,293
Transition Agreements To Airline-directed Model [Member]
Prepaid expense and other current assets	6,603
Property and equipment, net	(32,716)
Other non-current assets	18,783
Accrued liabilities	2,000
Current deferred airborne lease incentive	(13,592)
Non-current deferred airborne lease incentive	(17,289)
Equipment revenue	45,396
Cost of equipment revenue	$ 23,845

Recent Accounting Pronouncements - Summary of Adoption Impact of ASC 842 on Unaudited Condensed Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Assets
Operating lease right-of-use assets	$ 70,129
Liabilities
Accrued liabilities	183,067		213,111
Non-current operating lease liabilities	99,870
Other non-current liabilities	47,556		80,191
Equity
Accumulated deficit	(1,248,566)		$ (1,228,674)
Accounting Standards Update 2016-02 [Member]
Assets
Operating lease right-of-use assets		$ 72,188
Liabilities
Accrued liabilities		221,478
Non-current operating lease liabilities		102,440
Other non-current liabilities		44,013
Equity
Accumulated deficit		$ (1,231,767)
Difference between Guidance in Effect Before and after Topic 606 and ASC 34040 [Member] \| Accounting Standards Update 2016-02 [Member]
Assets
Operating lease right-of-use assets	72,188
Liabilities
Accrued liabilities	9,019
Non-current operating lease liabilities	102,440
Other non-current liabilities	(36,178)
Equity
Accumulated deficit	$ (3,093)

Revenue Recognition - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Revenue from Contracts with Customers [Line Items]
Transaction price allocated to remaining performance obligations	$ 831,000
Service revenue occurring period	1 year
Future equipment revenue recognition period	Next one to three years
Contract assets, current and non-current	$ 2,578
Future Equipment Revenue [Member]
Revenue from Contracts with Customers [Line Items]
Equipment revenue	114,000
Connectivity and Entertainment Service Revenues [Member]
Revenue from Contracts with Customers [Line Items]
Transaction price allocated to remaining performance obligations	717,000
Airline [Member]
Revenue from Contracts with Customers [Line Items]
Contract assets, current and non-current	66,400		$ 59,900
Accounting Standards Update 2014-09 [Member]
Revenue from Contracts with Customers [Line Items]
Deferred revenue, current and non-current	62,300		60,100
Deferred STC costs	16,300		$ 16,500
Accounting Standards Update 2014-09 [Member] \| Engineering, Design and Development [Member]
Revenue from Contracts with Customers [Line Items]
Deferred STC costs recognized	$ 300	$ 200

Revenue Recognition - Summary of Revenue Disaggregated by Category (Parenthetical) (Detail) $ in Millions	3 Months Ended
	Mar. 31, 2019 USD ($) Segment
Disaggregation of Revenue [Line Items]
Number of operating segments \| Segment	3
ATG [Member] \| CA-NA [Member]
Disaggregation of Revenue [Line Items]
Equipment revenue	$ 43.4
Satellite [Member] \| CA-NA [Member]
Disaggregation of Revenue [Line Items]
Equipment revenue	2.0
Airline, OEM and Aftermarket Dealer [Member] \| Product [Member] \| Transition Agreements To Airline-directed Model [Member] \| CA-NA [Member]
Disaggregation of Revenue [Line Items]
Equipment revenue	45.4
Airline Partners [Member] \| Product [Member] \| Transition Agreements To Airline-directed Model [Member] \| CA-NA [Member]
Disaggregation of Revenue [Line Items]
Equipment revenue	$ 45.4

Net Loss Per Share - Computation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Earnings Per Share [Abstract]
Net loss	$ (16,799)	$ (27,419)
Less: Participation rights of the Forward Transactions
Undistributed losses	$ (16,799)	$ (27,419)
Weighted-average common shares outstanding-basic and diluted	80,446	79,696
Net loss attributable to common stock per share-basic and diluted	$ (0.21)	$ (0.34)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Inventories - Components of Inventories (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Work-in-process component parts	$ 29,043	$ 30,340
Finished goods	118,311	162,705
Total inventory	$ 147,354	$ 193,045

Composition of Certain Balance Sheet Accounts - Schedule of Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Prepaid Expense and Other Assets [Abstract]
Contract assets	$ 10,852	$ 10,423
Prepaid satellite services	7,170	7,755
Restricted cash	1,535	1,535
Other	12,583	14,982
Total prepaid expenses and other current assets	$ 32,140	$ 34,695

Composition of Certain Balance Sheet Accounts - Property and Equipment (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,022,575	$ 944,772
Accumulated depreciation	(457,090)	(432,905)
Total property and equipment, net	565,485	511,867
Office Equipment, Furniture, Fixtures and Other [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	52,637	52,320
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	44,839	44,838
Airborne Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	715,055	642,151
Network Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 210,044	$ 205,463

Composition of Certain Balance Sheet Accounts - Schedule of Other Non-Current Assets (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Other Assets, Noncurrent [Abstract]
Contract assets	$ 55,536	$ 49,517
Deferred STC costs	16,289	16,453
Restricted cash	5,426	5,426
Other	9,082	12,816
Total other non-current assets	$ 86,333	$ 84,212

Composition of Certain Balance Sheet Accounts - Accrued Liabilities (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Accrued Liabilities, Current [Abstract]
Employee compensation and benefits	$ 13,437	$ 19,463
Airborne equipment and installation costs	17,625	25,119
Airline related accrued liabilities	41,609	45,077
Accrued interest	27,180	46,694
Accrued satellite network costs	14,989	19,557
Warranty reserve	11,750	12,291
Operating leases	11,585
Other	44,892	44,910
Total accrued liabilities	$ 183,067	$ 213,111

Composition of Certain Balance Sheet Accounts - Other Non-Current Liabilities (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Other Liabilities, Noncurrent [Abstract]
Deferred revenue	$ 24,709	$ 21,482
Deferred rent		35,897
Asset retirement obligations	9,945	9,696
Deferred tax liabilities	2,206	2,162
Other	10,696	10,954
Total other non-current liabilities	$ 47,556	$ 80,191

Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 0.6		$ 0.6
Amortization expense	$ 5.3	$ 7.6

Intangible Assets - Schedule of Intangible Assets, Other than Goodwill (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Intangible Assets Net Excluding Goodwill [Line Items]
Total intangible assets, Gross Carrying Amount	$ 219,394	$ 214,668
Amortized intangible assets, Gross Carrying Amount	187,111	182,385
Amortized intangible assets, Accumulated Amortization	(137,126)	(131,797)
Amortized intangible assets, Net Carrying Amount	49,985	50,588
Total intangible assets, Net Carrying Amount	82,268	82,871
FCC Licenses [Member]
Intangible Assets Net Excluding Goodwill [Line Items]
Total unamortized intangible assets, Gross Carrying Amount	32,283	32,283
Total unamortized intangible assets, Net Carrying Amount	$ 32,283	32,283
Software [Member]
Intangible Assets Net Excluding Goodwill [Line Items]
Weighted Average Remaining Useful Life (in years)	2 years 8 months 12 days
Amortized intangible assets, Gross Carrying Amount	$ 169,306	164,580
Amortized intangible assets, Accumulated Amortization	(121,933)	(116,873)
Amortized intangible assets, Net Carrying Amount	47,373	47,707
OEM and Dealer Relationships [Member]
Intangible Assets Net Excluding Goodwill [Line Items]
Amortized intangible assets, Gross Carrying Amount	6,724	6,724
Amortized intangible assets, Accumulated Amortization	$ (6,724)	(6,724)
Service Customer Relationships [Member]
Intangible Assets Net Excluding Goodwill [Line Items]
Weighted Average Remaining Useful Life (in years)	1 year 1 month 6 days
Amortized intangible assets, Gross Carrying Amount	$ 8,081	8,081
Amortized intangible assets, Accumulated Amortization	(7,058)	(6,804)
Amortized intangible assets, Net Carrying Amount	$ 1,023	1,277
Other Intangible Assets [Member]
Intangible Assets Net Excluding Goodwill [Line Items]
Weighted Average Remaining Useful Life (in years)	7 years 9 months 18 days
Amortized intangible assets, Gross Carrying Amount	$ 3,000	3,000
Amortized intangible assets, Accumulated Amortization	(1,411)	(1,396)
Amortized intangible assets, Net Carrying Amount	$ 1,589	$ 1,604

Intangible Assets - Summary of Amortization Expenses (Detail) $ in Thousands	Mar. 31, 2019 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2019 (period from April 1 to December 31)	$ 16,775
2020	15,915
2021	11,061
2022	4,230
2023	1,090
Thereafter	$ 914

Warranties - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Guarantor Obligations [Line Items]
Warranty reserve balance	$ 11,750	$ 12,291
Maximum [Member]
Guarantor Obligations [Line Items]
Warranty term	10 years
Minimum [Member]
Guarantor Obligations [Line Items]
Warranty term	2 years

Long-Term Debt and Other Liabilities - Additional Information (Detail) $ / shares in Units, shares in Millions				1 Months Ended								3 Months Ended		12 Months Ended
	Jan. 03, 2017 USD ($)	Jun. 14, 2016 USD ($)	Mar. 03, 2015 USD ($) $ / shares shares	Apr. 25, 2019 USD ($)	Apr. 18, 2019 USD ($)	Apr. 15, 2019 USD ($)	Nov. 30, 2018 USD ($)	Nov. 21, 2018 USD ($) $ / shares	Sep. 25, 2017 USD ($)	Sep. 20, 2017 USD ($)	Mar. 31, 2015 shares	Mar. 31, 2019 USD ($) Tradingday shares	Mar. 31, 2018 USD ($) shares	Dec. 31, 2018 USD ($)	May 07, 2019 USD ($)	May 03, 2019 USD ($)	Sep. 19, 2017 USD ($)
Debt Instrument [Line Items]
Total debt												$ 1,046,722,000		$ 1,041,948,000
Amortization of deferred financing costs												1,249,000	$ 1,035,000
Additional paid-in-capital												$ 967,727,000		963,458,000
Forward stock repurchase transactions amount			$ 140,000,000
Forward stock repurchase transaction, shares \| shares												7.2	7.2
Letters of Credit [Member]
Debt Instrument [Line Items]
Restricted cash												$ 7,000,000		7,000,000
Convertible Notes [Member]
Debt Instrument [Line Items]
Forward stock repurchase transaction, shares \| shares			7.2
Forward stock repurchase transaction, settlement date			Mar. 01, 2020
12.500% Senior Secured Notes Due 2022 [Member]
Debt Instrument [Line Items]
Aggregate principal amount		$ 525,000,000										$ 690,000,000		690,000,000
Interest rate		12.50%										12.50%
Unamortized debt premium and consent fees												$ 11,900,000		12,700,000
Total debt												$ 701,900,000		702,700,000
Interest rate payable term												semi-annually
Loan origination fees												$ 11,400,000
Amortization of deferred financing costs												800,000	$ 600,000
Debt issuance costs												9,300,000		10,000,000
Debt Instrument, Face Amount		$ 525,000,000										$ 690,000,000		690,000,000
12.500% Senior Secured Notes Due 2022 [Member] \| Subsequent Event [Member]
Debt Instrument [Line Items]
Debt instrument redemption price, percentage						100.00%
Debt Instrument, Repurchased Face Amount						$ 690,000,000
12.500% Senior Secured Notes Due 2022 [Member] \| Condition One [Member]
Debt Instrument [Line Items]
Debt instrument redemption price percentage of principal amount redeemed												35.00%
Debt instrument redemption price, percentage												112.50%
Outstanding redemption percentage												65.00%
12.500% Senior Secured Notes Due 2022 [Member] \| Condition Two [Member]
Debt Instrument [Line Items]
Debt instrument redemption price, percentage		100.00%
12.500% Senior Secured Notes Due 2022 [Member] \| Condition Three [Member]
Debt Instrument [Line Items]
Debt instrument redemption price, percentage		101.00%
12.500% Senior Secured Notes Due 2022 [Member] \| Additional Notes [Member] \| January Two Thousand And Seventeen Additional Notes [Member]
Debt Instrument [Line Items]
Aggregate principal amount	$ 65,000,000
Interest rate	12.50%
Issue price as percentage of face value	108.00%
Proceeds from issuance of debt	$ 70,200,000
Loan origination fees												$ 2,000,000
Debt Instrument, Face Amount	$ 65,000,000
12.500% Senior Secured Notes Due 2022 [Member] \| Additional Notes [Member] \| September Two Thousand And Seventeen Additional Notes [Member]
Debt Instrument [Line Items]
Aggregate principal amount									$ 100,000,000
Interest rate									12.50%
Issue price as percentage of face value									113.00%
Proceeds from issuance of debt									$ 113,000,000
Accrued interest received									2,900,000
Loan origination fees												2,500,000
Debt Instrument, Face Amount									$ 100,000,000
12.500% Senior Secured Notes Due 2022 [Member] \| Supplemental Indenture [Member]
Debt Instrument [Line Items]
Aggregate principal amount										$ 175,000,000							$ 75,000,000
Increase in debt amount										100,000,000
Additional secured indebtedness										50,000,000
Additional dividends										15,000,000
Consent fees paid										1,400,000		1,400,000
Debt Instrument, Face Amount										$ 175,000,000							$ 75,000,000
3.75% Convertible Senior Notes [Member]
Debt Instrument [Line Items]
Aggregate principal amount			$ 361,900,000
Interest rate			3.75%
Interest rate payable term			semi-annually
Amortization of deferred financing costs												200,000	400,000
Debt issuance costs												700,000		900,000
Debt instrument redemption price, percentage			100.00%
Option granted to initial purchasers			$ 60,000,000
Additional paid-in-capital			100,000,000
Convertible Notes, carrying amount of liability component			261,900,000									$ 151,800,000		149,195,000
Effective interest rate on convertible notes												11.50%
Proceeds received from the issuance of the convertible notes			$ 361,900,000									$ 162,000,000		162,000,000
Convertible Notes, unamortized discount												10,200,000		12,800,000
Conversion rate			41.9274
Principal amount			$ 1,000									$ 1,000	1,000
Conversion price \| $ / shares			$ 23.85
Multiples of principal amount			$ 1,000
Forward stock repurchase transactions amount			140,000,000
Forward stock repurchase transaction, shares \| shares											7.2
Repayment of convertible notes							$ 199,900,000
Increase in convertale notes							$ 17,900,000
Debt Instrument, Face Amount			361,900,000
3.75% Convertible Senior Notes [Member] \| Subsequent Event [Member]
Debt Instrument [Line Items]
Debt Instrument Redemption Price					$ 1,000
Debt Instrument Principal Redemption					$ 1,000
3.75% Convertible Senior Notes [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Percentage of common share price over conversion price for conversion												130.00%
Common stock price trading days \| Tradingday												20
Common stock price consecutive trading days \| Tradingday												30
3.75% Convertible Senior Notes [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Debt instrument redemption price, percentage												98.00%
Common stock price trading days \| Tradingday												5
Common stock price consecutive trading days \| Tradingday												5
3.75% Convertible Senior Notes [Member] \| Issuance Costs [Member]
Debt Instrument [Line Items]
Loan origination fees												$ 10,400,000
Additional paid-in-capital												2,900,000
Issuance cost recorded to deferred financing costs												$ 7,500,000
3.75% Convertible Senior Notes [Member] \| Institutional Buyers [Member]
Debt Instrument [Line Items]
Aggregate principal amount			340,000,000
Principal amount of Convertible Notes, subsequently exercised			21,900,000
Debt Instrument, Face Amount			$ 340,000,000
6.00% Convertible Senior Notes [Member]
Debt Instrument [Line Items]
Aggregate principal amount								$ 237,800,000
Interest rate								6.00%
Interest rate payable term												Semi-annually
Amortization of deferred financing costs												$ 400,000
Debt issuance costs												5,800,000		6,200,000
Debt instrument redemption price, percentage								100.00%
Option granted to initial purchasers								$ 32,300,000
Principal amount of Convertible Notes, subsequently exercised								22,800,000
Additional paid-in-capital								49,100,000
Convertible Notes, carrying amount of liability component								$ 188,700,000				193,000,000		190,100,000
Effective interest rate on convertible notes								13.60%
Proceeds received from the issuance of the convertible notes								$ 237,800,000
Convertible Notes, unamortized discount												44,700,000		47,700,000
Conversion rate								166.6667
Principal amount								$ 1,000				1,000	$ 1,000
Conversion price \| $ / shares								$ 6.00
Multiples of principal amount								$ 1,000
Outstanding principal balance paid												$ 237,800,000		$ 237,800,000
Debt Instrument, Face Amount								237,800,000
6.00% Convertible Senior Notes [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Percentage of common share price over conversion price for conversion												130.00%
Common stock price trading days \| Tradingday												20
Common stock price consecutive trading days \| Tradingday												30
6.00% Convertible Senior Notes [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Debt instrument redemption price, percentage												98.00%
Common stock price trading days \| Tradingday												5
Common stock price consecutive trading days \| Tradingday												5
6.00% Convertible Senior Notes [Member] \| Issuance Costs [Member]
Debt Instrument [Line Items]
Loan origination fees								8,100,000
Additional paid-in-capital								1,700,000
Issuance cost recorded to deferred financing costs								6,400,000
6.00% Convertible Senior Notes [Member] \| Institutional Buyers [Member]
Debt Instrument [Line Items]
Aggregate principal amount								215,000,000
Debt Instrument, Face Amount								$ 215,000,000
9.875% Senior secured Notes Due On 2024 [Member] \| Subsequent Event [Member]
Debt Instrument [Line Items]
Aggregate principal amount				$ 905,000,000
Interest rate				9.875%
Maturity date				May 01, 2024
Debt Instrument, Interest Rate Terms				semiannually
Debt Instrument, Face Amount				$ 905,000,000
9.875% Senior secured Notes Due On 2024 [Member] \| May Two Thousand And Nineteen Additional Notes [Member]
Debt Instrument [Line Items]
Aggregate principal amount															$ 20,000,000
Guarantee obligations maximum exposure																$ 20,000,000
Debt Instrument, Face Amount															$ 20,000,000

Long-Term Debt and Other Liabilities - Schedule of Long-Term Debt (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018	Mar. 03, 2015
Debt Instrument [Line Items]
Total debt	$ 1,046,722	$ 1,041,948
Less deferred financing costs	(16,363)	(17,055)
Total long-term debt	1,030,359	1,024,893
12.500% Senior Secured Notes Due 2022 [Member]
Debt Instrument [Line Items]
Senior Secured Notes	701,910	702,670
Total debt	701,900	702,700
2022 Convertible Notes [Member]
Debt Instrument [Line Items]
Convertible Notes	193,012	190,083
2020 Convertible Notes [Member]
Debt Instrument [Line Items]
Convertible Notes	$ 151,800	$ 149,195	$ 261,900

Long-Term Debt and Other Liabilities - Summary of Redemption Prices Plus Accrued and Unpaid Interest (Detail) - 12.500% Senior Secured Notes Due 2022 [Member]	3 Months Ended
	Mar. 31, 2019
2019 [Member]
Debt Instrument, Redemption [Line Items]
Debt instrument redemption price, percentage	106.25%
2020 [Member]
Debt Instrument, Redemption [Line Items]
Debt instrument redemption price, percentage	103.125%
2021 and Thereafter [Member]
Debt Instrument, Redemption [Line Items]
Debt instrument redemption price, percentage	100.00%

Interest Costs - Summary of Interest Costs (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Schedule Of Interest [Line Items]
Interest costs charged to expense	$ 26,531	$ 24,980
Amortization of deferred financing costs	1,249	1,035
Accretion of debt discount on Convertible Notes	5,534	5,224
Amortization of debt premium on Senior Secured Notes	(760)	(685)
Interest expense	32,554	30,554
Total interest costs	32,683	30,598
Property and Equipment [Member]
Schedule Of Interest [Line Items]
Interest costs capitalized	4	12
Software [Member]
Schedule Of Interest [Line Items]
Interest costs capitalized	$ 125	$ 32

Leases - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Leases [Line Items]
Amortization of deferred airborne lease incentives	$ 8,953	$ 7,630
Deferred airborne lease incentives included in current liabilities	22,726		$ 24,145
Deferred airborne lease incentives included in non-current liabilities	131,743		$ 129,086
Revenue share expense, net of amortization of deferred airborne lease incentives	$ 3,700	$ 6,400
Lessee operating lease option to extend	20 years

Leases - summary of our lease expense (Detail) $ in Thousands	3 Months Ended
	Mar. 31, 2019 USD ($)
Operating lease cost	$ 4,918
Finance lease cost
Amortization of leased assets	205
Interest on lease liabilities	11
Total lease cost	$ 5,134

Leases - Other information regarding our leases (Detail) $ in Thousands	3 Months Ended
	Mar. 31, 2019 USD ($)
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows used in operating leases	$ 6,117
Operating cash flows used in financing leases	11
Financing cash flows used in financing leases	125
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$ 279
Weighted average remaining lease term
Operating leases	9 years
Financing leases	1 year
Weighted average discount rate
Operating leases	10.30%
Financing leases	8.70%

Leases - Annual Future Minimum Obligations for Operating Leases Other than Arrangements with Commercial Airline Partners (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Operating Leases
2019 (period from April 1 to December 31)	$ 16,966	$ 21,902
2020	21,192	19,867
2021	20,870	19,742
2022	19,441	18,420
2023	15,606	14,826
Thereafter	76,900	78,100
Total future minimum lease payments	170,975
Less: Amount representing interest	(59,520)
Present value of net minimum lease payments	111,455
Accrued liabilities	11,585
Non-current operating lease liabilities	99,870
Total lease liabilities	111,455
Financing Leases
2019 (period from April 1 to December 31)	550
2020	206
Total future minimum lease payments	756
Less: Amount representing interest	(28)
Present value of net minimum lease payments	728
Accrued liabilities	584
Other non-current liabilities	144
Total lease liabilities	$ 728

Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	Jun. 30, 2018	Mar. 31, 2019
Loss Contingencies [Line Items]
2019 (April 1 through December 31)		$ 77.3
2020		95.2
2021		81.3
2022		67.6
2023		58.8
Thereafter		$ 159.0
Contingent annual cash rebate	$ 1.8
Linksmart Litigation [Member]
Loss Contingencies [Line Items]
Litigation filing date		April 20, 2018
Securities Litigation [Member]
Loss Contingencies [Line Items]
Litigation filing date		June 27, 2018
Derivative Litigation [Member]
Loss Contingencies [Line Items]
Litigation filing date		September 25, 2018 and September 26, 2018

Fair Value of Financial Assets and Liabilities - Summary of Fair Value and Carrying Value of Long-Term Debt (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018	Mar. 03, 2015
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total debt	$ 1,046,722	$ 1,041,948
2022 Senior Secured Notes [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value of Long Term Debt	745,000	737,000
Total debt	701,910	702,670
2022 Convertible Notes [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value of Convertible Notes	236,000	216,000
Carrying Value of Convertible Notes	193,012	190,083
2020 Convertible Notes [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value of Convertible Notes	157,000	150,000
Carrying Value of Convertible Notes	$ 151,800	$ 149,195	$ 261,900

Fair Value of Financial Assets and Liabilities - Summary of Fair Value and Carrying Value of Long-Term Debt (Parenthetical) (Detail) - USD ($) $ in Millions	Mar. 31, 2019	Dec. 31, 2018
2022 Senior Secured Notes [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Unamortized debt premium and consent fees	$ 11.9	$ 12.7
6% Convertible Senior Notes [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt Instrument, Unamortized Discount	44.7	47.7
3.75% Convertible Senior Notes [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt Instrument, Unamortized Discount	$ 10.2	$ 12.8

Income Tax - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Tax Credit Carryforward [Line Items]
Effective income tax rate	(1.20%)	12.00%
Reduction in our valuation allowance due to tax reform	$ 4.0
Interest or penalties related to uncertain tax positions	0.0	$ 0.0
Liabilities for interest and potential penalties	0.0		$ 0.0
Increase (decrease) in unrecognized tax benefits	$ 0.0

Business Segments and Major Customers - Additional Information (Detail)	3 Months Ended		12 Months Ended
	Mar. 31, 2019 Segment Customer Partner	Mar. 31, 2018 Customer Partner	Dec. 31, 2018
Segment Reporting Information [Line Items]
Number of operating segments \| Segment	3
Revenue [Member]
Segment Reporting Information [Line Items]
Number of customers meeting concentration risk threshold	0	0
Revenue [Member] \| Customer Concentration Risk [Member]
Segment Reporting Information [Line Items]
Percentage of benchmark	15.00%	15.00%
Revenue [Member] \| Customer Concentration Risk [Member] \| Delta Airline and American Airlines [Member]
Segment Reporting Information [Line Items]
Percentage of benchmark	29.00%	20.00%
Revenue [Member] \| Customer Concentration Risk [Member] \| American Airlines [Member]
Segment Reporting Information [Line Items]
Percentage of benchmark	10.00%	36.00%
Accounts Receivable [Member]
Segment Reporting Information [Line Items]
Number of customers meeting concentration risk threshold	1
Number of airline partners meeting concentration risk threshold \| Partner	1	1
Accounts Receivable [Member] \| Credit Concentration Risk [Member] \| American Airlines [Member]
Segment Reporting Information [Line Items]
Percentage of benchmark			11.00%
Accounts Receivable [Member] \| Credit Concentration Risk [Member] \| Delta Air Lines [Member]
Segment Reporting Information [Line Items]
Percentage of benchmark	11.00%		11.00%

Business Segments and Major Customers - Summary of Reportable Segments (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting Information [Line Items]
Total revenue	$ 199,549	$ 231,825
Segment profit (loss)	37,891	11,374
Service [Member]
Segment Reporting Information [Line Items]
Total revenue	165,012	150,678
Product [Member]
Segment Reporting Information [Line Items]
Total revenue	34,537	81,147
CA-NA [Member]
Segment Reporting Information [Line Items]
Total revenue	96,069	143,821
Segment profit (loss)	23,542	1,656
CA-NA [Member] \| Service [Member]
Segment Reporting Information [Line Items]
Total revenue	92,027	88,783
CA-NA [Member] \| Product [Member]
Segment Reporting Information [Line Items]
Total revenue	4,042	55,038
CA-ROW [Member]
Segment Reporting Information [Line Items]
Total revenue	32,931	19,169
Segment profit (loss)	(19,149)	(22,605)
CA-ROW [Member] \| Service [Member]
Segment Reporting Information [Line Items]
Total revenue	19,772	14,245
CA-ROW [Member] \| Product [Member]
Segment Reporting Information [Line Items]
Total revenue	13,159	4,924
BA [Member]
Segment Reporting Information [Line Items]
Total revenue	70,549	68,835
Segment profit (loss)	33,498	32,323
BA [Member] \| Service [Member]
Segment Reporting Information [Line Items]
Total revenue	53,213	47,650
BA [Member] \| Product [Member]
Segment Reporting Information [Line Items]
Total revenue	$ 17,336	$ 21,185

Business Segments and Major Customers - Reconciliation of Segment Profit (loss) (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Segment profit (loss)	$ 37,891	$ 11,374
Interest income	1,149	1,076
Interest expense	(32,554)	(30,554)
Depreciation and amortization	(30,749)	(35,919)
Transition to airline-directed model		19,302
Amortization of deferred airborne lease incentives	8,953	7,630
Amortization of STC costs	(320)	(172)
Stock compensation expense	(4,327)	(4,386)
Other income	3,365	505
Loss before income taxes	(16,592)	(31,144)
CA-NA [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Segment profit (loss)	23,542	1,656
CA-ROW [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Segment profit (loss)	(19,149)	(22,605)
BA [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Segment profit (loss)	$ 33,498	$ 32,323

Employee Retirement and Postretirement Benefits - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Employee Contribution	100.00%
Percentage of employees contribution matched by the company	4.00%
Employer Contribution	$ 1.2	$ 1.2
Stock options, shares granted	1,302,928
Stock options exercised	111,963
Stock options, shares expired	5,225
Market Condition [Member]
Stock options, shares granted	148,500
Stock options exercised	111,963
Share units granted	86,000
Share units forfeited	29,904
Restricted Stock Units (RSUs) [Member]
Share units granted	1,946,799
Share units forfeited	107,027
Share units vested	207,188
Restricted Stock [Member]
Share units vested	36,145
Deferred Stock Units [Member]
Share units granted	53,448
Share units vested	53,448
Performance Condition [Member]
Stock options, shares granted	50,000
Share units granted	50,000
Employee Stock Purchase Plan [Member]
Common stock, shares issued under ESPP	75,253

Employee Retirement and Postretirement Benefits - Summary of Stock-Based Compensation Expense by Operating Expense (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 4,327	$ 4,386
Cost of Service Revenue [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	428	434
Cost of Equipment Revenue [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	71	54
Engineering, Design and Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	774	910
Sales and Marketing [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	970	1,082
General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 2,084	$ 1,906

Research and Development Costs - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Research and Development Expense	$ 14.1	$ 19.2

Fair Value of Financial Assets and Liabilities - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract]
Assets fair value adjustments	$ 0	$ 0