gogo-10q_20210331.htm
false 0001537054 Q1 --12-31 P2Y P2Y3M18D P8Y us-gaap:AccruedLiabilitiesMember us-gaap:AccruedLiabilitiesMember 0001537054 2021-01-01 2021-03-31 0001537054 us-gaap:CommonStockMember 2021-01-01 2021-03-31 0001537054 us-gaap:PreferredStockMember 2021-01-01 2021-03-31 xbrli:shares 0001537054 2021-04-30 iso4217:USD 0001537054 2021-03-31 0001537054 2020-12-31 iso4217:USD xbrli:shares 0001537054 us-gaap:ServiceMember 2021-01-01 2021-03-31 0001537054 us-gaap:ServiceMember 2020-01-01 2020-03-31 0001537054 us-gaap:ProductMember 2021-01-01 2021-03-31 0001537054 us-gaap:ProductMember 2020-01-01 2020-03-31 0001537054 2020-01-01 2020-03-31 0001537054 2019-12-31 0001537054 2020-03-31 0001537054 us-gaap:CommonStockMember 2020-12-31 0001537054 us-gaap:AdditionalPaidInCapitalMember 2020-12-31 0001537054 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-12-31 0001537054 us-gaap:RetainedEarningsMember 2020-12-31 0001537054 us-gaap:TreasuryStockMember 2020-12-31 0001537054 us-gaap:RetainedEarningsMember 2021-01-01 2021-03-31 0001537054 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-01-01 2021-03-31 0001537054 us-gaap:AdditionalPaidInCapitalMember 2021-01-01 2021-03-31 0001537054 us-gaap:AdditionalPaidInCapitalMember srt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember 2021-03-31 0001537054 us-gaap:RetainedEarningsMember srt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember 2021-03-31 0001537054 srt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember 2021-03-31 0001537054 us-gaap:CommonStockMember 2021-03-31 0001537054 us-gaap:AdditionalPaidInCapitalMember 2021-03-31 0001537054 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-03-31 0001537054 us-gaap:RetainedEarningsMember 2021-03-31 0001537054 us-gaap:TreasuryStockMember 2021-03-31 0001537054 us-gaap:CommonStockMember 2019-12-31 0001537054 us-gaap:AdditionalPaidInCapitalMember 2019-12-31 0001537054 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-12-31 0001537054 us-gaap:RetainedEarningsMember 2019-12-31 0001537054 us-gaap:RetainedEarningsMember 2020-01-01 2020-03-31 0001537054 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-01-01 2020-03-31 0001537054 us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-03-31 0001537054 us-gaap:CommonStockMember 2020-01-01 2020-03-31 0001537054 us-gaap:TreasuryStockMember 2020-01-01 2020-03-31 0001537054 srt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember us-gaap:RetainedEarningsMember 2020-03-31 0001537054 srt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember 2020-03-31 0001537054 us-gaap:CommonStockMember 2020-03-31 0001537054 us-gaap:AdditionalPaidInCapitalMember 2020-03-31 0001537054 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-03-31 0001537054 us-gaap:RetainedEarningsMember 2020-03-31 0001537054 us-gaap:TreasuryStockMember 2020-03-31 0001537054 us-gaap:SegmentDiscontinuedOperationsMember 2021-01-01 2021-03-31 0001537054 2020-12-01 2020-12-01 gogo:ClassOfCommonStock 0001537054 2020-01-01 2020-12-31 0001537054 gogo:CostOfServiceRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:CostOfEquipmentRevenueMember 2020-01-01 2020-03-31 0001537054 2021-02-01 2021-02-28 0001537054 2021-02-28 0001537054 gogo:CostOfServiceRevenueMember us-gaap:DiscontinuedOperationsHeldforsaleMember 2020-01-01 2020-03-31 0001537054 gogo:EngineeringDesignAndDevelopmentMember us-gaap:DiscontinuedOperationsHeldforsaleMember 2020-01-01 2020-03-31 0001537054 us-gaap:SellingAndMarketingExpenseMember us-gaap:DiscontinuedOperationsHeldforsaleMember 2020-01-01 2020-03-31 0001537054 us-gaap:GeneralAndAdministrativeExpenseMember us-gaap:DiscontinuedOperationsHeldforsaleMember 2021-01-01 2021-03-31 0001537054 us-gaap:GeneralAndAdministrativeExpenseMember us-gaap:DiscontinuedOperationsHeldforsaleMember 2020-01-01 2020-03-31 0001537054 us-gaap:DiscontinuedOperationsHeldforsaleMember 2021-01-01 2021-03-31 0001537054 us-gaap:DiscontinuedOperationsHeldforsaleMember 2020-01-01 2020-03-31 0001537054 gogo:AccountingStandardsUpdate202006Member 2021-01-01 0001537054 gogo:AccountingStandardsUpdate202006Member gogo:DifferenceBetweenGuidanceInEffectBeforeAndAfterAscThreeTwoSixMember 2021-01-01 0001537054 gogo:ConnectivityAndEntertainmentServiceRevenuesMember 2021-03-31 0001537054 gogo:FutureEquipmentRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:ConnectivityMember gogo:CostOfServiceRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:ConnectivityMember gogo:CostOfServiceRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:EntertainmentAndOtherMember gogo:CostOfServiceRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:EntertainmentAndOtherMember gogo:CostOfServiceRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:CostOfServiceRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:CostOfServiceRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:ATGMember gogo:CostOfEquipmentRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:ATGMember gogo:CostOfEquipmentRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:SatelliteMember gogo:CostOfEquipmentRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:SatelliteMember gogo:CostOfEquipmentRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:OtherProductOrServiceMember gogo:CostOfEquipmentRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:OtherProductOrServiceMember gogo:CostOfEquipmentRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:CostOfEquipmentRevenueMember 2021-01-01 2021-03-31 0001537054 gogo:CostOfEquipmentRevenueMember 2020-01-01 2020-03-31 0001537054 gogo:AircraftOwnerOperatorMember 2021-01-01 2021-03-31 0001537054 gogo:AircraftOwnerOperatorMember 2020-01-01 2020-03-31 0001537054 gogo:OEMAndAftermarketDealerMember 2021-01-01 2021-03-31 0001537054 gogo:OEMAndAftermarketDealerMember 2020-01-01 2020-03-31 0001537054 us-gaap:AccountingStandardsUpdate201409Member 2021-03-31 0001537054 us-gaap:AccountingStandardsUpdate201409Member 2020-12-31 0001537054 gogo:AirlineMember 2021-03-31 0001537054 gogo:AirlineMember 2020-12-31 gogo:Customer xbrli:pure 0001537054 us-gaap:SalesRevenueNetMember 2021-01-01 2021-03-31 0001537054 us-gaap:SalesRevenueNetMember 2020-01-01 2020-03-31 0001537054 us-gaap:AccountsReceivableMember 2021-01-01 2021-03-31 0001537054 us-gaap:AccountsReceivableMember 2020-01-01 2020-12-31 0001537054 us-gaap:OfficeEquipmentMember 2021-03-31 0001537054 us-gaap:OfficeEquipmentMember 2020-12-31 0001537054 us-gaap:LeaseholdImprovementsMember 2021-03-31 0001537054 us-gaap:LeaseholdImprovementsMember 2020-12-31 0001537054 gogo:NetworkEquipmentMember 2021-03-31 0001537054 gogo:NetworkEquipmentMember 2020-12-31 0001537054 us-gaap:ComputerSoftwareIntangibleAssetMember 2021-01-01 2021-03-31 0001537054 us-gaap:OtherIntangibleAssetsMember 2021-01-01 2021-03-31 0001537054 us-gaap:ComputerSoftwareIntangibleAssetMember 2021-03-31 0001537054 us-gaap:OtherIntangibleAssetsMember 2021-03-31 0001537054 us-gaap:CustomerRelationshipsMember 2021-03-31 0001537054 gogo:OemAndDealerRelationshipsMember 2021-03-31 0001537054 us-gaap:ComputerSoftwareIntangibleAssetMember 2020-12-31 0001537054 us-gaap:OtherIntangibleAssetsMember 2020-12-31 0001537054 us-gaap:CustomerRelationshipsMember 2020-12-31 0001537054 gogo:OemAndDealerRelationshipsMember 2020-12-31 0001537054 gogo:FccLicenseMember 2021-03-31 0001537054 gogo:FccLicenseMember 2020-12-31 0001537054 srt:MinimumMember 2021-01-01 2021-03-31 0001537054 srt:MaximumMember 2021-01-01 2021-03-31 0001537054 gogo:TwoThousandAndTwentyFourSeniorSecuredNotesMemberMember 2021-03-31 0001537054 gogo:TwoThousandAndTwentyFourSeniorSecuredNotesMemberMember 2020-12-31 0001537054 gogo:TwoThousandAndTwentyTwoConvertibleNotesMember 2021-03-31 0001537054 gogo:TwoThousandAndTwentyTwoConvertibleNotesMember 2020-12-31 0001537054 us-gaap:SeniorNotesMember 2019-04-25 0001537054 us-gaap:SeniorNotesMember 2019-04-11 2019-04-25 0001537054 us-gaap:SeniorNotesMember 2020-11-09 0001537054 gogo:NinePointEightSevenFiveSeniorSecuredNotesDueOn2024Member gogo:MayTwoThousandAndNineteenAdditionalNotesMember 2019-05-07 0001537054 us-gaap:SeniorNotesMember 2020-11-13 0001537054 us-gaap:SeniorNotesMember 2020-10-30 2020-11-13 0001537054 us-gaap:SeniorNotesMember gogo:MayTwoThousandAndNineteenAdditionalNotesMember 2020-10-30 2020-11-13 0001537054 us-gaap:SeniorNotesMember gogo:NovemberTwoThousandAndTwentyAdditionalNotesMember 2020-10-30 2020-11-13 0001537054 us-gaap:SeniorNotesMember 2021-03-31 0001537054 us-gaap:SeniorNotesMember 2021-01-01 2021-03-31 0001537054 us-gaap:SeniorNotesMember 2020-12-31 0001537054 gogo:TwoThousandTwentyConvertibleNotesMember gogo:LossOnExtinguishmentOfDebtMember 2021-01-01 2021-03-31 0001537054 gogo:TwoThousandTwentyConvertibleNotesMember gogo:LossOnExtinguishmentOfDebtMember 2021-03-31 0001537054 gogo:NinePointEightSevenFiveSeniorSecuredNotesDueOn2024Member gogo:MayTwoThousandAndNineteenAdditionalNotesMember 2021-03-31 0001537054 gogo:NinePointEightSevenFiveSeniorSecuredNotesDueOn2024Member 2021-01-01 2021-03-31 0001537054 gogo:NinePointEightSevenFiveSeniorSecuredNotesDueOn2024Member 2020-01-01 2020-03-31 0001537054 gogo:NinePointEightSevenFiveSeniorSecuredNotesDueOn2024Member 2021-03-31 0001537054 gogo:NinePointEightSevenFiveSeniorSecuredNotesDueOn2024Member 2020-12-31 0001537054 us-gaap:DebtInstrumentRedemptionPeriodOneMember gogo:TwoThousandAndTwentyFourSeniorSecuredNotesMemberMember 2021-01-01 2021-03-31 0001537054 us-gaap:DebtInstrumentRedemptionPeriodTwoMember gogo:TwoThousandAndTwentyFourSeniorSecuredNotesMemberMember 2021-01-01 2021-03-31 0001537054 us-gaap:DebtInstrumentRedemptionPeriodThreeMember gogo:TwoThousandAndTwentyFourSeniorSecuredNotesMemberMember 2021-01-01 2021-03-31 0001537054 gogo:TwelvePointFiveZeroZeroSeniorSecuredNotesDue2022Member gogo:ConditionOneMember 2021-01-01 2021-03-31 0001537054 us-gaap:SeniorNotesMember gogo:ConditionOneMember 2021-01-01 2021-03-31 0001537054 us-gaap:SeniorNotesMember gogo:ConditionOneMember 2020-01-01 2020-12-31 0001537054 gogo:NinePointEightSevenFiveSeniorSecuredNotesDueOn2024Member gogo:ConditionTwoMember 2021-01-01 2021-03-31 0001537054 gogo:AblCreditFacilityMember gogo:JpMorganChaseBankNaMember 2019-08-26 0001537054 gogo:AblCreditFacilityMember gogo:JpMorganChaseBankNaMember srt:MaximumMember 2021-03-31 0001537054 2019-07-27 2019-08-26 0001537054 srt:MinimumMember us-gaap:LondonInterbankOfferedRateLIBORMember 2019-07-27 2019-08-26 0001537054 srt:MaximumMember us-gaap:LondonInterbankOfferedRateLIBORMember 2019-07-27 2019-08-26 0001537054 srt:MinimumMember us-gaap:BaseRateMember 2019-07-27 2019-08-26 0001537054 srt:MaximumMember us-gaap:BaseRateMember 2019-07-27 2019-08-26 0001537054 gogo:AblCreditFacilityMember srt:MinimumMember 2019-07-27 2019-08-26 0001537054 gogo:AblCreditFacilityMember srt:MaximumMember 2019-07-27 2019-08-26 0001537054 gogo:AblCreditFacilityMember 2020-09-30 0001537054 gogo:AblCreditFacilityMember 2019-08-26 0001537054 us-gaap:LineOfCreditMember us-gaap:SubsequentEventMember 2021-04-30 0001537054 us-gaap:LineOfCreditMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember us-gaap:SubsequentEventMember 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 gogo:TermLoanAndRevolvingCreditFacilityMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 gogo:TermLoanAndRevolvingCreditFacilityMember srt:MinimumMember us-gaap:LondonInterbankOfferedRateLIBORMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 gogo:TermLoanAndRevolvingCreditFacilityMember srt:MinimumMember us-gaap:BaseRateMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember srt:MinimumMember us-gaap:LondonInterbankOfferedRateLIBORMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember srt:MaximumMember us-gaap:LondonInterbankOfferedRateLIBORMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember srt:MinimumMember us-gaap:BaseRateMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember srt:MaximumMember us-gaap:BaseRateMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember srt:MinimumMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:RevolvingCreditFacilityMember srt:MaximumMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:LineOfCreditMember gogo:TermLoanAndRevolvingCreditFacilityMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 2021-04-01 2021-04-30 0001537054 us-gaap:LineOfCreditMember gogo:TermLoanAndRevolvingCreditFacilityMember us-gaap:SubsequentEventMember 2021-04-30 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:InstitutionalBuyersMember 2018-11-21 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember 2018-11-21 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember 2018-11-07 2018-11-21 0001537054 gogo:TwoThousandAndTwentyTwoConvertibleNotesMember 2021-01-01 2021-03-31 0001537054 gogo:TwoThousandAndTwentyTwoConvertibleNotesMember 2020-01-01 2020-12-31 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:IssuanceCostsMember 2018-11-07 2018-11-21 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:IssuanceCostsMember 2018-11-21 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember 2021-01-01 2021-03-31 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember 2020-01-01 2020-03-31 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember 2021-03-31 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember 2020-12-31 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:March2021ExchangeAgreementsMember 2021-01-01 2021-03-31 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:April2021ExchangeAgreementMember us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:April2021ExchangeAgreementMember us-gaap:SubsequentEventMember 2021-04-30 0001537054 gogo:March2021ExchangeAgreementsMember 2021-01-01 2021-03-31 0001537054 2018-11-21 gogo:Tradingday 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:StockPriceConditionMember 2018-11-07 2018-11-21 0001537054 gogo:SixPointZeroZeroPercentConvertibleSeniorNotesMember gogo:NotesPriceConditionMember 2018-11-07 2018-11-21 0001537054 gogo:TwoThousandAndTwentyConvertibleSeniorNotesMember 2015-03-02 2015-03-03 0001537054 gogo:ConvertibleNotesMember 2015-03-02 2015-03-03 0001537054 gogo:TwoThousandAndTwentyConvertibleSeniorNotesMember 2019-12-11 2019-12-11 0001537054 gogo:TwoThousandAndTwentyConvertibleSeniorNotesMember 2020-03-30 2020-03-31 0001537054 2020-03-30 2020-03-31 0001537054 us-gaap:SubsequentEventMember 2021-04-01 2021-04-30 0001537054 us-gaap:LetterOfCreditMember 2021-03-31 0001537054 us-gaap:LetterOfCreditMember 2020-12-31 0001537054 us-gaap:SoftwareAndSoftwareDevelopmentCostsMember 2021-01-01 2021-03-31 0001537054 us-gaap:SoftwareAndSoftwareDevelopmentCostsMember 2020-01-01 2020-03-31 0001537054 gogo:LinksmartLitigationMember 2021-01-01 2021-03-31 0001537054 gogo:SecuritiesLitigationMember 2021-01-01 2021-03-31 0001537054 gogo:DerivativeLitigationMember 2021-01-01 2021-03-31 0001537054 gogo:EmployeeStockPurchasePlanMember 2021-01-01 2021-03-31 0001537054 us-gaap:RestrictedStockUnitsRSUMember 2021-01-01 2021-03-31 0001537054 gogo:DeferredStockUnitsMember 2021-01-01 2021-03-31 0001537054 us-gaap:RestrictedStockMember 2021-01-01 2021-03-31 0001537054 gogo:EngineeringDesignAndDevelopmentMember 2021-01-01 2021-03-31 0001537054 gogo:EngineeringDesignAndDevelopmentMember 2020-01-01 2020-03-31 0001537054 us-gaap:SellingAndMarketingExpenseMember 2021-01-01 2021-03-31 0001537054 us-gaap:SellingAndMarketingExpenseMember 2020-01-01 2020-03-31 0001537054 us-gaap:GeneralAndAdministrativeExpenseMember 2021-01-01 2021-03-31 0001537054 us-gaap:GeneralAndAdministrativeExpenseMember 2020-01-01 2020-03-31

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

 

(Mark One):

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

 

For the quarterly period ended March 31, 2021

 

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

 

For the transition period from __________ to __________

 

 

Commission File Number: 001-35975

 

 

Gogo Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

 

27-1650905

(State or other jurisdiction of

Incorporation or Organization)

 

(I.R.S. Employer

Identification No.)

 

 

111 North Canal St., Suite 1400

Chicago, IL 60606

(Address of principal executive offices)

Telephone Number (303301-3271

(Registrant’s telephone number, including area code)

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Class

 

Trading Symbol

 

Name of Each Exchange on Which Registered

Common stock, par value $0.0001 per share

 

GOGO

 

NASDAQ Global Select Market

Preferred Stock Purchase Rights

 

GOGO

 

NASDAQ Global Select Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes   No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

Non-accelerated filer

 

 

Smaller reporting company

 

 

 

 

 

Emerging growth company

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

As of April 30, 2021, 109,609,821 shares of $0.0001 par value common stock were outstanding.

 


 


 

Gogo Inc.

 

INDEX

 

 

 

Page

Part I.

Financial Information

 

Item 1.

Financial Statements

2

 

Unaudited Condensed Consolidated Balance Sheets

2

 

Unaudited Condensed Consolidated Statements of Operations

3

 

Unaudited Condensed Consolidated Statements of Comprehensive Loss

4

 

Unaudited Condensed Consolidated Statements of Cash Flows

5

 

Unaudited Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

6

 

Notes to Unaudited Condensed Consolidated Financial Statements

8

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

30

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

41

Item 4.

Controls and Procedures

41

 

 

 

Part II.

Other Information

 

Item 1.

Legal Proceedings

42

Item 1A.

Risk Factors

43

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

48

Item 3.

Defaults Upon Senior Securities

48

Item 4.

Mine Safety Disclosures

48

Item 5.

Other Information

48

Item 6.

Exhibits

49

Signatures

50

 

 

 

1


 

 

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Gogo Inc. and Subsidiaries

Unaudited Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

 

 

 

March 31,

 

 

December 31,

 

 

 

2021

 

 

2020

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

455,152

 

 

$

435,345

 

Accounts receivable, net of allowances of $813 and $1,044, respectively

 

 

36,232

 

 

 

39,833

 

Inventories

 

 

28,560

 

 

 

28,114

 

Prepaid expenses and other current assets

 

 

9,625

 

 

 

8,934

 

Total current assets

 

 

529,569

 

 

 

512,226

 

Non-current assets:

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

61,519

 

 

 

63,493

 

Intangible assets, net

 

 

51,128

 

 

 

52,693

 

Operating lease right-of-use assets

 

 

32,473

 

 

 

33,690

 

Other non-current assets, net of allowances of $375 and $375, respectively

 

 

13,043

 

 

 

11,486

 

Total non-current assets

 

 

158,163

 

 

 

161,362

 

Total assets

 

$

687,732

 

 

$

673,588

 

Liabilities and stockholders’ deficit

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

11,322

 

 

$

11,013

 

Accrued liabilities

 

 

94,134

 

 

 

83,009

 

Deferred revenue

 

 

3,759

 

 

 

3,113

 

Current portion of long-term debt

 

 

-

 

 

 

341,000

 

Total current liabilities

 

 

109,215

 

 

 

438,135

 

Non-current liabilities:

 

 

 

 

 

 

 

 

Long-term debt

 

 

1,163,822

 

 

 

827,968

 

Non-current operating lease liabilities

 

 

36,354

 

 

 

38,018

 

Other non-current liabilities

 

 

9,844

 

 

 

10,581

 

Total non-current liabilities

 

 

1,210,020

 

 

 

876,567

 

Total liabilities

 

 

1,319,235

 

 

 

1,314,702

 

Commitments and contingencies (Note 13)

 

 

 

 

 

 

-

 

Stockholders’ deficit

 

 

 

 

 

 

 

 

Common stock, par value $0.0001 per share; 500,000,000 shares authorized at March 31, 2021 and December 31, 2020; 97,158,550 and 91,086,191 shares issued at March 31, 2021 and December 31, 2020, respectively; and 92,071,085 and 85,990,499 shares outstanding at March 31, 2021 and December 31, 2020, respectively

 

 

9

 

 

 

9

 

Additional paid-in capital

 

 

1,080,305

 

 

 

1,088,590

 

Accumulated other comprehensive loss

 

 

(912

)

 

 

(1,013

)

Treasury stock, at cost

 

 

(98,857

)

 

 

(98,857

)

Accumulated deficit

 

 

(1,612,048

)

 

 

(1,629,843

)

Total stockholders’ deficit

 

 

(631,503

)

 

 

(641,114

)

Total liabilities and stockholders’ deficit

 

$

687,732

 

 

$

673,588

 

 

See the Notes to Unaudited Condensed Consolidated Financial Statements

2


 

Gogo Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

 

 

 

For the Three Months

 

 

 

Ended March 31,

 

 

 

2021

 

 

2020

 

Revenue:

 

 

 

 

 

 

 

 

Service revenue

 

$

59,355

 

 

$

57,726

 

Equipment revenue

 

 

14,514

 

 

 

13,201

 

Total revenue

 

 

73,869

 

 

 

70,927

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Cost of service revenue (exclusive of items shown below)

 

 

14,095

 

 

 

11,007

 

Cost of equipment revenue (exclusive of items shown below)

 

 

8,282

 

 

 

8,511

 

Engineering, design and development

 

 

5,493

 

 

 

7,357

 

Sales and marketing

 

 

3,729

 

 

 

4,450

 

General and administrative

 

 

10,373

 

 

 

14,706

 

Depreciation and amortization

 

 

4,117

 

 

 

3,579

 

Total operating expenses

 

 

46,089

 

 

 

49,610

 

Operating income

 

 

27,780

 

 

 

21,317

 

 

 

 

 

 

 

 

 

 

Other (income) expense:

 

 

 

 

 

 

 

 

Interest income

 

 

(57

)

 

 

(578

)

Interest expense

 

 

29,294

 

 

 

31,143

 

Loss on settlement of convertible notes

 

 

4,397

 

 

 

-

 

Other income

 

 

(5

)

 

 

(1

)

Total other expense

 

 

33,629

 

 

 

30,564

 

 

 

 

 

 

 

 

 

 

Loss from continuing operations before income taxes

 

 

(5,849

)

 

 

(9,247

)

Income tax provision

 

 

35

 

 

 

141

 

Net loss from continuing operations

 

 

(5,884

)

 

 

(9,388

)

Net loss from discontinued operations, net of tax

 

 

(1,801

)

 

 

(75,390

)

Net loss

 

$

(7,685

)

 

$

(84,778

)

 

 

 

 

 

 

 

 

 

Net loss attributable to common stock per share – basic and diluted:

 

 

 

 

 

 

 

 

Net loss from continuing operations

 

$

(0.07

)

 

$

(0.12

)

Net loss from discontinued operations

 

 

(0.02

)

 

 

(0.93

)

Net loss

 

$

(0.09

)

 

$

(1.05

)

 

 

 

 

 

 

 

 

 

Weighted average number of sharesbasic and diluted

 

 

84,649

 

 

 

81,205

 

 

See the Notes to Unaudited Condensed Consolidated Financial Statements

3


 

Gogo Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Comprehensive Loss

(in thousands)

 

 

 

 

For the Three Months

 

 

 

 

Ended March 31,

 

 

 

 

2021

 

 

 

2020

 

Net loss

 

$

(7,685

)

 

$

(84,778

)

Currency translation adjustments, net of tax

 

 

101

 

 

 

(2,871

)

Comprehensive loss

 

$

(7,584

)

 

$

(87,649

)

 

See the Notes to Unaudited Condensed Consolidated Financial Statements

4


 

Gogo Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Cash Flows

(in thousands)

 

 

 

For the Three Months

 

 

 

Ended March 31,

 

 

 

2021

 

 

2020

 

Operating activities from continuing operations:

 

 

 

 

 

 

 

 

Net loss

 

$

(5,884

)

 

$

(9,388

)

Adjustments to reconcile net loss to cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

4,117

 

 

 

3,579

 

(Gain) Loss on asset disposals, abandonments and write-downs

 

 

(100

)

 

 

74

 

Provision for expected credit losses

 

 

15

 

 

687

 

Deferred income taxes

 

 

95

 

 

 

45

 

Stock-based compensation expense

 

 

1,849

 

 

 

2,322

 

Amortization of deferred financing costs

 

 

1,703

 

 

 

1,419

 

Accretion and amortization of debt discount and premium

 

 

84

 

 

 

3,326

 

Loss on settlement of convertible notes

 

 

4,397

 

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

3,586

 

 

 

4,220

 

Inventories

 

 

(446

)

 

 

(2,196

)

Prepaid expenses and other current assets

 

 

(375

)

 

 

(3,872

)

Contract assets

 

 

(1,886

)

 

 

(2,558

)

Accounts payable

 

 

292

 

 

 

6,108

 

Accrued liabilities

 

 

(10,424

)

 

 

(6,882

)

Deferred revenue

 

 

646

 

 

 

308

 

Accrued interest

 

 

27,559

 

 

 

26,413

 

Other non-current assets and liabilities

 

 

(654

)

 

 

285

 

Net cash provided by operating activities from continuing operations

 

 

24,574

 

 

 

23,890

 

 

 

 

 

 

 

 

 

 

Investing activities from continuing operations:

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(360

)

 

 

(150

)

Acquisition of intangible assetscapitalized software

 

 

(342

)

 

 

(726

)

Net cash provided by (used in) investing activities from continuing operations

 

 

(702

)

 

 

(876

)

 

 

 

 

 

 

 

 

 

Financing activities from continuing operations:

 

 

 

 

 

 

 

 

Proceeds from credit facility draw

 

 

-

 

 

 

22,000

 

Repurchase of convertible notes

 

 

-

 

 

 

(2,498

)

Payment of debt issuance costs

 

 

(550

)

 

 

-

 

Payments on financing leases

 

 

(124

)

 

 

-

 

Stock-based compensation activity

 

 

(2,646

)

 

 

(397

)

Net cash provided by (used in) financing activities from continuing operations

 

 

(3,320

)

 

 

19,105

 

Cash flows from discontinued operations:

 

 

 

 

 

 

 

 

Cash provided by (used in) operating activities

 

 

(748

)

 

 

14,137

 

Cash used in investing activities

 

 

-

 

 

 

(14,345

)

Cash used in financing activities

 

 

-

 

 

 

(247

)

Net cash used in discontinued operations

 

 

(748

)

 

 

(455

)

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash

 

 

3

 

 

 

51

 

 

 

 

 

 

 

 

 

 

Increase in cash, cash equivalents and restricted cash

 

 

19,807

 

 

 

41,715

 

Cash, cash equivalents and restricted cash at beginning of period

 

 

435,870

 

 

 

177,675

 

Cash, cash equivalents and restricted cash at end of period

 

$

455,677

 

 

$

219,390

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash at end of period

 

$

455,677

 

 

$

219,390

 

Less: current restricted cash

 

 

525

 

 

 

560

 

Less: non-current restricted cash

 

 

-

 

 

 

4,601

 

Cash and cash equivalents at end of period

 

$

455,152

 

 

$

214,229

 

 

 

 

 

 

 

 

 

 

Supplemental Cash Flow Information:

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

31

 

 

$

66

 

Cash paid for taxes

 

 

1

 

 

 

1

 

 

See the Notes to Unaudited Condensed Consolidated Financial Statements

 

 

 

5


 

 

Gogo Inc. and Subsidiaries

Unaudited Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

(in thousands, except share data)

 

 

 

 

For the Three Months Ended March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

 

Paid-In

 

 

 

Comprehensive

 

 

 

Accumulated

 

 

 

Treasury Stock

 

 

 

 

 

 

 

 

Shares

 

 

 

Par Value

 

 

 

Capital

 

 

 

Loss

 

 

 

Deficit

 

 

 

Shares

 

 

 

Amount

 

 

 

Total

 

Balance at January 1, 2021

 

 

85,990,499

 

 

$

9

 

 

$

1,088,590

 

 

$

(1,013

)

 

$

(1,629,843

)

 

 

5,077,400

 

 

$

(98,857

)

 

$

(641,114

)

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(7,685

)

 

 

-

 

 

 

-

 

 

 

(7,685

)

Currency translation adjustments, net of tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

101

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

101

 

Stock-based compensation expense

 

 

-

 

 

 

-

 

 

 

7,927

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

7,927

 

Issuance of common stock upon exercise of stock options

 

 

177,646

 

 

 

-

 

 

 

458

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

458

 

Issuance of common stock upon vesting of restricted stock units and restricted stock awards

 

 

602,826

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Tax withholding related to vesting of restricted stock units

 

 

-

 

 

 

-

 

 

 

(3,220

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,220

)

Issuance of common stock in connection with employee stock purchase plan

 

 

11,637

 

 

 

-

 

 

 

116

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

116

 

Settlement of convertible notes

 

 

5,288,477

 

 

 

-

 

 

 

33,857

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

33,857

 

Impact of the adoption of ASU 2020-06

 

 

-

 

 

 

-

 

 

 

(47,423

)

 

 

-

 

 

 

25,480

 

 

 

-

 

 

 

-

 

 

 

(21,943

)

Balance at March 31, 2021

 

 

92,071,085

 

 

$

9

 

 

$

1,080,305

 

 

$

(912

)

 

$

(1,612,048

)

 

 

5,077,400

 

 

$

(98,857

)

 

$

(631,503

)

 

6


 

 

 

 

 

For the Three Months Ended March 31, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Paid-In

 

 

Comprehensive

 

 

Accumulated

 

 

Treasury Stock

 

 

 

 

 

 

 

Shares

 

 

Par Value

 

 

Capital

 

 

Loss

 

 

Deficit

 

 

Shares

 

 

Amount

 

 

Total

 

Balance at January 1, 2020

 

 

88,240,877

 

 

$

9

 

 

$

979,499

 

 

$

(2,256

)

 

$

(1,376,142

)

 

 

-

 

 

$

-

 

 

$

(398,890

)

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(84,778

)

 

 

-

 

 

 

-

 

 

 

(84,778

)

Currency translation adjustments, net of tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,871

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,871

)

Stock-based compensation expense

 

 

-

 

 

 

-

 

 

 

3,995

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,995

 

Issuance of common stock upon vesting of restricted stock units and restricted stock awards

 

 

522,490

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Tax withholding related to vesting of restricted stock units

 

 

-

 

 

 

-

 

 

 

(682

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(682

)

Issuance of common stock in connection with employee stock purchase plan

 

 

87,681

 

 

 

-

 

 

 

285

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

285

 

Settlement of prepaid forward shares

 

 

(5,077,400

)

 

 

(1

)

 

 

98,858

 

 

 

-

 

 

 

-

 

 

 

5,077,400

 

 

 

(98,857

)

 

 

-

 

Impact of the adoption of ASU 2016-13

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(3,665

)

 

 

-

 

 

 

-

 

 

 

(3,665

)

Balance at March 31, 2020

 

 

83,773,648

 

 

$

8

 

 

$

1,081,955