Running hot in customers' hands: existing deployments are being used harder than they were sized for
The model's full reasoning — Q1 2016 call → NOWe need to determine if management describes that the company's product/service/capacity is already deployed and being used more intensively by existing customers than originally expected, with this heavier usage observable in current business. Scan the transcript for relevant statements. Michael Small mentions "2Ku is now in commercial service" and "2Ku awards now exceed 1000 aircraft." But that's about awards, not usage intensity. Norman Smagley discusses ARPA (average revenue per aircraft) and mentions "annualized ARPA of 134,000 was consistent with the prior year, but grew 15% year-over-year excluding aircraft we have added since the beginning of 2015, primarily regional jets and aircraft with new airline partners." That indicates same-aircraft ARPA growth, but is that about usage intensity? ARPA is revenue per aircraft, which could be driven by usage, but the context is about dilution from new aircraft. He says "We expect continued ARPA dilution over the next couple of quarters as we finish installing regional jets and launch new airline partners. The dilution from these aircraft will start to diminish as these new fleets become seasoned and as we begin to upgrade Delta planes to 2Ku. We expect ARPA growth to be modest in 2017 and accelerate in 2018 as we get more 2Ku aircraft online." That suggests ARPA growth is expected in future, not currently observed as a pattern of heavier usage. Michael Small says "we are making great progress on the increasing volume of STCs, completion of which will keep us on track to exceed our 75 2Ku installation target this year." That's about installations, not usage. He also says "All told we installed or upgraded more than 500 aircraft across commercial and business aviation this quarter, another Company record." That's about installs. He mentions "Gogo Biz 4G is now flying on our test lab and customers are beginning to provision their planes in preparation for 4G's commercial launch in 2017." That's future. He says "we are seeing tremendous ARPA growth in Business Aviation where the bandwidth is plenty for those size aircraft. And we are seeing 15% ARPA growth on the planes that have been in the network for a while." That is a direct statement about existing planes showing ARPA growth. But is that due to heavier usage? ARPA is revenue per aircraft, which could be from more usage or higher prices.
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TJX · Q2 2021 → YESThe question is about whether management describes that the company's product, service, capacity, or offering — already deployed with existing customers — is being used more intensively than originall...
WES · Q3 2018 → YESThe question is about whether management describes that the company's product, service, capacity, or offering — already deployed with existing customers — is being used more intensively than originall...
BCE · Q2 2017 → YESThe question is about whether management describes that the company's product, service, capacity, or offering — already deployed with existing customers — is being used more intensively than originall...