HomeMarket NewsMicro Cap StocksApple Partner Globalstar Stock Is Falling After Q3 Performance - What's Going...

Apple Partner Globalstar Stock Is Falling After Q3 Performance – What’s Going On?

Actionable Trade Ideas

always free


Breaking Down Globalstar’s Q3 Performance

Globalstar, Inc (GSAT), the mobile satellite voice and data services provider, recently announced its financial results for the third quarter of FY23. Despite reporting impressive sales growth and beating consensus expectations, the company’s stock is currently experiencing a decline. So, what’s happening?

In Q3, Globalstar achieved a remarkable year-on-year sales growth of 53%, totaling $57.7 million. This surpassed the consensus expectation of $53.7 million and was fueled by an increase in service revenue.

The company also saw an improvement in its adjusted EBITDA, which reached $32 million in Q3, a significant 125% increase compared to the previous year. This growth can be attributed to the higher revenue generated during the quarter.

Interestingly, Globalstar managed to turn its operating income around, recording $2.0 million in Q3 compared to a loss of $186.6 million in the same period last year. This improvement can be credited to a non-cash impairment charge experienced in the year-ago period.

While there is still a net loss of $6.2 million in Q3, it is significantly lower compared to the net loss of $204.4 million reported a year ago. Globalstar continues to make progress in reducing its losses and is optimistic about future growth opportunities.

Positive Momentum and New Revenue Streams

Rebecca Clary, Chief Financial Officer of Globalstar, expressed satisfaction with the company’s performance and highlighted the momentum gained in their non-wholesale services, particularly with new initiatives in Commercial IoT (Internet of Things).

Furthermore, Globalstar’s CEO, Dr. Paul E. Jacobs, mentioned an exciting development in the form of the company’s new XCOMP technology. This technology enhances wireless performance, including spectral efficiency, and is expected to open up a whole new revenue category for Globalstar in the future.

Looking Ahead: Revised Outlook and Growth Potential

As for its outlook, Globalstar has revised its FY23 revenue expectations to a range of $215 million to $230 million, up from the previous estimate of $200 million to $230 million. This revised outlook reflects the company’s confidence in achieving stronger financial results.

Globalstar also maintains its forecast for an adjusted EBITDA margin of approximately 55% for FY23. This indicates that the company expects to achieve healthy profitability despite ongoing investments and expansion efforts.

However, despite these positive developments, Globalstar’s stock price has declined by 1.79% to $1.38 as of the last check on Thursday. The market response could be influenced by various factors, including broader market trends, investor sentiment, or concerns specific to the company.

In Summary

Globalstar’s Q3 performance showcased strong sales growth and improved financial metrics. The company’s ability to exceed consensus expectations and reduce losses demonstrates positive momentum for its business. With new initiatives in Commercial IoT and the introduction of XCOMP technology, Globalstar is positioning itself for future growth and revenue diversification.

While its revised revenue outlook and projected EBITDA margin indicate confidence in its potential, the recent decline in the company’s stock price suggests that further investigation may be required to understand the factors driving market sentiment. Monitoring Globalstar’s future developments and market trends will provide valuable insights for investors and traders interested in the company.

Swing Trading Ideas and Market Commentary

Need some new swing ideas? Get free weekly swing ideas and market commentary from Jonathan Bernstein here: Swing Trading.

Explore More

Weekly In-Depth Market Analysis and Actionable Trade Ideas

Get institutional-level analysis and trade ideas to take your trading to the next level, sign up for free and become apart of the community.