Shares of Gogo (GOGO 2.21%) have flown higher today, up by 12% as of 1 p.m. EDT, after the company announced a significant operational milestone. The in-flight internet provider said that it has completed installation of its AVANCE L5 system on 1,000 business jets.
Gogo has achieved the milestone less than three years after the very first L5 installation. The company is also approaching 450 installations of its AVANCE L3 offering, bringing total installations on business jets to approximately 1,500. AVANCE L5 provides 4G network speeds while AVANCE L3 offers 3G speeds.
"We couldn't have achieved this milestone without the great partnerships we've built over more than 25 years with the market-leading business jet manufacturers, our dealers, and charter and fractional operators," Sergio Aguirre, president of Gogo's business aviation segment, said in a statement. "Even during the COVID-19 pandemic that has had such a dramatic impact on all of aviation, we continued to see a healthy demand from the market for our AVANCE systems."
Gogo is in the process of trying to sell its commercial in-flight business, which has been hit particularly hard, as airline travel has been decimated during the COVID-19 pandemic. The company's commercial aviation (CA) business has been losing money ($37.2 million last quarter) while the business aviation (BA) segment has held up relatively better. Revenue declines in the BA business have not been as dramatic and the division generated segment profits of $27.2 million last quarter.
With Gogo pursuing a CA sale, investors are encouraged that the company is executing well on the BA front, which would be the only remaining segment if a sale is completed.