Iridium Communications Inc at Raymond James TMT and Consumer Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Ric Prentiss - Raymond James - Analyst : And when we think about Iridium, what makes Iridium unique or special? It's a neighborhood, I guess, but what makes you guys unique in the neighborhood?

Question: Ric Prentiss - Raymond James - Analyst : Yeah, one of the questions we get is there's a lot of buzz about direct-to-device, that getting satellite connectivity into smartphones. Apple has it in the iPhone 14, 15, 16. You've got SpaceX Starlink, Musk doing stuff with T-Mobile. You've got AT&T and others working with ASTS, Globalstar, who's here later this week is doing stuff with some L-band as well. ViaSat talks about doing stuff with L-band, maybe S-band. It's complicated and confusing but help us understand where you guys are playing in the direct-to-device space planning. And why does somebody want to use a Garmin device longer term if their cell phone is going to have it?

Question: Ric Prentiss - Raymond James - Analyst : Okay. Makes sense. One of the other dynamics is SpaceX Starlink. Kind of a little bit of a boogeyman out there. Everyone is trying to figure out what they're going to do and how they're going to do it. Talk a little bit about specifically that competitor. I know a lot of investors have looked at the election and thinking, well, isn't the probability of Elon Musk getting favorable treatment in this administration, a strong probability. So how do you view them as competitors? And what might change with an administration that would affect you guys?

Question: Ric Prentiss - Raymond James - Analyst : And why is that?

Question: Ric Prentiss - Raymond James - Analyst : Yeah, On the voice and kind of the legacy voice and data, you guys have typically kept ARPUs kind of flattish. And then all of a sudden, there'll be a price increase. And then it will be flat again for a period of time. A lot of the other industries we deal with streaming services, cable bills, mobile bills seem to feel that they've got the ability to take pricing up more frequently, like say, annually versus saying, hey, let's hold it for five years maybe and then take it up. Walk us through your thought about why not do smaller incremental increases annually as opposed to kind of step functions?

Question: Ric Prentiss - Raymond James - Analyst : Okay. You mentioned first five years where we get it funded, get the Block-2 stuff out there to replace Block-1. Block-3. You increase the accounting life of Block-2. Maybe you'll increase the accounting life again at some point. Walk us through the thought process on what's the life of this current constellation? When do you really need to start thinking about the next generation?

Question: Ric Prentiss - Raymond James - Analyst : And then as far as thinking through what the next constellation cost would be, first generation, CapEx, operating losses, getting the whole company lifted up was like $6 billion probably.

Question: Ric Prentiss - Raymond James - Analyst : Second generation was more like $3 billion probably all in.

Question: Ric Prentiss - Raymond James - Analyst : How should we think about -- well, maybe we're still 10 years away from having to have something in service. How much do we think the goalpost might be on what that next generation might be, when do we think we might start seeing some of that CapEx come in? Just kind of a magnitude and timing. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 09, 2024 / 3:00PM, IRDM.OQ - Iridium Communications Inc at Raymond James TMT and Consumer Conference

Question: Ric Prentiss - Raymond James - Analyst : I'm glad to hear the payload options on the table. So a lot of people launching a lot of birds. You don't have to have your own birds. You're not wedded to the fact of we have to have our own birds.

Question: Ric Prentiss - Raymond James - Analyst : And there's people putting up birds up there and we can be.

Question: Ric Prentiss - Raymond James - Analyst : CapEx prior to then kind of $60 million in the short term because you've had some other stuff, if I remember right, maybe it averages a little lower.

Question: Ric Prentiss - Raymond James - Analyst : You mentioned that you're still feeling comfortable approaching $500 million of OEBITDA for '25.

Question: Ric Prentiss - Raymond James - Analyst : So a lot of free cash flow production because your taxes are de minimis still, like, through '28?

Question: Ric Prentiss - Raymond James - Analyst : What are you hearing from D.C. as far as tax legislation that might be beneficial to you guys? Anything?

Question: Ric Prentiss - Raymond James - Analyst : You guys have made an acquisition, Satelles, now Iridium Time and Location, if I remember right. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 09, 2024 / 3:00PM, IRDM.OQ - Iridium Communications Inc at Raymond James TMT and Consumer Conference

Question: Ric Prentiss - Raymond James - Analyst : Walk us through the logic on that? And then what other acquisitions might be out there? And how important are they to the $1 billion service revenue 2030?

Question: Ric Prentiss - Raymond James - Analyst : What's a newspaper?

Question: Ric Prentiss - Raymond James - Analyst : Great. I think we'll wrap it there and take it to the sessions everyone else has. Randy, do you want to throw a quick one? You got a minute. Unidentified Participant Yes, here we go. Can you just give us a snapshot of what the cash flows could be in '25, and you talked a little bit about the regulatory outlook, like this is the time that the FAA finally appraise you?

Question: Ric Prentiss - Raymond James - Analyst : Great. We'll wrap it there. Appreciate it. Everyone have a good conference.