Company: IRDM
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0001628280-25-005302
Chunk: 104

Company: Iridium Communications Inc.
Filing Date: 2025-02-13
Form: 10-K
Item: Item 7
Chunk 104
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 are at the end of the respective period.

We provide airtime and airtime support to U.S. government and other authorized customers pursuant to our Enhanced Mobile Satellite Services, or EMSS, contract. Under the terms of this agreement, which we entered into in September 2019, authorized customers utilize specified Iridium airtime services provided through the U.S. government’s dedicated gateway. The fee is not based on subscribers or usage, allowing an unlimited number of users access to these services. Revenue for the year ended December 31, 2024 rose slightly reflecting a contractual step up in the EMSS contract on September 15, 2024.

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Subscriber Equipment Revenue

Subscriber equipment revenue decreased $13.7 million, or 13%, to $91.4 million for the year ended December 31, 2024 compared to the prior year, primarily due to a decrease in the volume of handset sales, offset in part by an increase in Short Burst Data sales. The overall decrease was is in line with our previously announced expectations, as we returned to more normal levels after the supply chain disruptions due to the pandemic. We expect equipment revenue in 2025 to be in line with 2024. 

Engineering and Support Service Revenue

 Year Ended December 31,  20242023Change (In millions)Commercial$7.3 $11.0 $(3.7)Government117.0 90.1 26.9 Total$124.3 $101.1 $23.2 

Engineering and support service revenue increased by $23.2 million, or 23%, for the year ended December 31, 2024 compared to the prior year primarily due to the increased work under certain government projects, predominantly the contract awarded by the Space Development Agency, or the SDA, offset in part by decreases in commercial engineering projects. We expect engineering and support service revenue to be higher in 2025 than in 2024.

Operating Expenses

Cost of Services (exclusive of depreciation and amortization)

Cost of services (exclusive of depreciation and amortization) includes the cost of network engineering and operations staff, including contractors, software maintenance, product support services, and cost of services for government and commercial engineering and support service revenue.

Cost of services (exclusive of depreciation and amortization) increased by $19.4 million, or 12%, for the year ended December 31, 2024 compared to the prior year, primarily as a result of increased work under