Viasat Earnings 2020-06-30

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

vsat-10q_20200630.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020.

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number (000-21767)

VIASAT, INC.

(Exact name of registrant as specified in its charter)

Delaware

33-0174996

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

6155 El Camino Real

Carlsbad, California 92009

(760) 476-2200

(Address of principal executive offices and telephone number)

Securities registered pursuant to Section 12(b) of the Act:

(Title of Each Class)		(Trading Symbol)		(Name of Each Exchange on which Registered)
Common Stock, par value $0.0001 per share		VSAT		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the registrant’s common stock, $0.0001 par value, as of July 24, 2020 was 67,501,560.

VIASAT, INC.

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)		3
Condensed Consolidated Balance Sheets		3
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)		4
Condensed Consolidated Statements of Cash Flows		5
Condensed Consolidated Statements of Equity		6
Notes to the Condensed Consolidated Financial Statements		7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		32
Item 3. Quantitative and Qualitative Disclosures About Market Risk		52
Item 4. Controls and Procedures		53
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		53
Item 1A. Risk Factors		53
Item 6. Exhibits		54
Signatures		55

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

VIASAT, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	As of June 30, 2020			As of March 31, 2020
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	232,418		$	304,309
Accounts receivable, net		270,436			330,698
Inventories		312,686			294,416
Prepaid expenses and other current assets		105,985			116,281
Total current assets		921,525			1,045,704

Property, equipment and satellites, net		2,715,822			2,586,735
Operating lease right-of-use assets		304,975			308,441
Other acquired intangible assets, net		13,041			14,439
Goodwill		121,285			121,197
Other assets		827,726			807,352
Total assets	$	4,904,374		$	4,883,868
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	175,955		$	183,601
Accrued and other liabilities		359,762			391,190
Current portion of long-term debt		29,470			29,788
Total current liabilities		565,187			604,579

Senior notes		1,680,902			1,285,497
Other long-term debt		134,636			536,166
Non-current operating lease liabilities		281,937			286,550
Other liabilities		142,529			120,934
Total liabilities		2,805,191			2,833,726
Commitments and contingencies (Note 9)
Equity:
Viasat, Inc. stockholders’ equity
Common stock		6			6
Paid-in capital		1,846,827			1,788,456
Retained earnings		232,984			245,373
Accumulated other comprehensive loss		(6,851	)		(6,048	)
Total Viasat, Inc. stockholders’ equity		2,072,966			2,027,787
Noncontrolling interest in subsidiary		26,217			22,355
Total equity		2,099,183			2,050,142
Total liabilities and equity	$	4,904,374		$	4,883,868

See accompanying notes to the condensed consolidated financial statements.

VIASAT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

	Three Months Ended
	June 30, 2020			June 30, 2019
	(In thousands, except per share data)
Revenues:
Product revenues	$	250,634		$	263,615
Service revenues		279,854			273,422
Total revenues		530,488			537,037
Operating expenses:
Cost of product revenues		187,892			196,940
Cost of service revenues		197,677			187,519
Selling, general and administrative		121,039			125,132
Independent research and development		27,636			33,474
Amortization of acquired intangible assets		1,558			2,037
Loss from operations		(5,314	)		(8,065	)
Other income (expense):
Interest income		232			925
Interest expense		(9,524	)		(11,174	)
Loss before income taxes		(14,606	)		(18,314	)
Benefit from income taxes		5,748			7,210
Equity in income of unconsolidated affiliate, net		331			1,367
Net loss		(8,527	)		(9,737	)
Less: net income attributable to noncontrolling interest, net of tax		3,862			1,731
Net loss attributable to Viasat, Inc.	$	(12,389	)	$	(11,468	)
Basic net loss per share attributable to Viasat, Inc. common stockholders	$	(0.20	)	$	(0.19	)
Diluted net loss per share attributable to Viasat, Inc. common stockholders	$	(0.20	)	$	(0.19	)
Shares used in computing basic net loss per share		62,511			60,917
Shares used in computing diluted net loss per share		62,511			60,917
Comprehensive income (loss):
Net loss	$	(8,527	)	$	(9,737	)
Other comprehensive income (loss), net of tax:
Unrealized gain on hedging, net of tax		—			45
Foreign currency translation adjustments, net of tax		(803	)		(2,284	)
Other comprehensive loss, net of tax		(803	)		(2,239	)
Comprehensive loss		(9,330	)		(11,976	)
Less: comprehensive income attributable to noncontrolling interest, net of tax		3,862			1,731
Comprehensive loss attributable to Viasat, Inc.	$	(13,192	)	$	(13,707	)

See accompanying notes to the condensed consolidated financial statements.

VIASAT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Three Months Ended
	June 30, 2020			June 30, 2019
	(In thousands)
Cash flows from operating activities:
Net loss	$	(8,527	)	$	(9,737	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation		77,760			68,802
Amortization of intangible assets		14,842			15,210
Stock-based compensation expense		20,942			21,227
Loss on disposition of fixed assets		6,689			13,134
Other non-cash adjustments		(4,428	)		(5,367	)
Increase (decrease) in cash resulting from changes in operating assets and liabilities:
Accounts receivable		55,440			(5,472	)
Inventories		(18,118	)		(29,252	)
Other assets		17,946			(13,595	)
Accounts payable		(10,037	)		(3,869	)
Accrued liabilities		(4,903	)		(8,000	)
Other liabilities		9,301			3,383
Net cash provided by operating activities		156,907			46,464
Cash flows from investing activities:
Purchase of property, equipment and satellites		(208,722	)		(166,115	)
Cash paid for patents, licenses and other assets		(20,540	)		(21,936	)
Proceeds from insurance claims on ViaSat-2 satellite		—			2,277
Net cash used in investing activities		(229,262	)		(185,774	)
Cash flows from financing activities:
Proceeds from debt borrowings		400,000			—
Payments of debt borrowings		(402,697	)		(11,821	)
Payment of debt issuance costs		(3,790	)		(2,479	)
Proceeds from issuance of common stock under equity plans		9,206			24,377
Purchase of common stock in treasury (immediately retired) related to tax withholdings for stock-based compensation		(401	)		(2,328	)
Other financing activities		(2,178	)		(255	)
Net cash provided by financing activities		140			7,494
Effect of exchange rate changes on cash		324			(2	)
Net decrease in cash and cash equivalents		(71,891	)		(131,818	)
Cash and cash equivalents at beginning of period		304,309			261,701
Cash and cash equivalents at end of period	$	232,418		$	129,883

See accompanying notes to the condensed consolidated financial statements.

VIASAT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(UNAUDITED)

	Viasat, Inc. Stockholders
	Common Stock
	Number of Shares Issued		Amount		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interest in Subsidiary		Total
	(In thousands, except share data)
For the Three Months Ended June 30, 2020
Balance at March 31, 2020		62,147,140	$	6	$	1,788,456		$	245,373		$	(6,048	)	$	22,355	$	2,050,142
Issuance of stock under Employee Stock Purchase Plan		282,269		—		9,206			—			—			—		9,206
Stock-based compensation		—		—		24,160			—			—			—		24,160
Shares issued in settlement of certain accrued employee compensation liabilities		580,846		—		25,406			—			—			—		25,406
RSU awards vesting, net of shares withheld for taxes which have been retired		15,746		—		(401	)		—			—			—		(401	)
Net (loss) income		—		—		—			(12,389	)		—			3,862		(8,527	)
Other comprehensive loss, net of tax		—		—		—			—			(803	)		—		(803	)
Balance at June 30, 2020		63,026,001	$	6	$	1,846,827		$	232,984		$	(6,851	)	$	26,217	$	2,099,183

For the Three Months Ended June 30, 2019
Balance at March 31, 2019		60,550,093	$	6	$	1,656,819		$	245,585		$	5,338		$	8,330	$	1,916,078
Exercise of stock options		259,125		—		16,071			—			—			—		16,071
Issuance of stock under Employee Stock Purchase Plan		165,770		—		8,306			—			—			—		8,306
Stock-based compensation		—		—		24,312			—			—			—		24,312
Shares issued in settlement of certain accrued employee compensation liabilities		255,615		—		22,829			—			—			—		22,829
RSU awards vesting, net of shares withheld for taxes which have been retired		46,330		—		(2,328	)		—			—			—		(2,328	)
Net (loss) income		—		—		—			(11,468	)		—			1,731		(9,737	)
Other comprehensive loss, net of tax		—		—		—			—			(2,239	)		—		(2,239	)
Balance at June 30, 2019		61,276,933	$	6	$	1,726,009		$	234,117		$	3,099		$	10,061	$	1,973,292

See accompanying notes to the condensed consolidated financial statements.

Price	75.27	EPS	-0
Shares	63	P/E	-670
MCap	4,724	P/FCF	16
Net Debt	1,411	EBIT	31
TEV	6,135	TEV/EBIT	196
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-06-30	Filed 2020-08-07
10-K	2020-03-31	Filed 2020-05-29
10-Q	2019-12-31	Filed 2020-02-10
10-Q	2019-09-30	Filed 2019-11-12
10-Q	2019-06-30	Filed 2019-08-09
10-K	2019-03-31	Filed 2019-05-29
10-Q	2018-12-31	Filed 2019-02-11
10-Q	2018-09-30	Filed 2018-11-07
10-Q	2018-06-30	Filed 2018-08-09
10-K	2018-03-31	Filed 2018-05-30
10-Q	2017-12-31	Filed 2018-02-09
10-Q	2017-09-30	Filed 2017-11-09
10-Q	2017-06-30	Filed 2017-08-09
10-K	2017-03-31	Filed 2017-05-25
10-Q	2016-12-31	Filed 2017-02-09
10-Q	2016-09-30	Filed 2016-11-09
10-Q	2016-06-30	Filed 2016-08-09
10-K	2016-03-31	Filed 2016-05-26
10-Q	2015-12-31	Filed 2016-02-09
10-Q	2015-09-30	Filed 2015-11-09
10-Q	2015-06-30	Filed 2015-08-10
10-K	2015-04-03	Filed 2015-05-26
10-Q	2015-01-02	Filed 2015-02-11
10-Q	2014-10-03	Filed 2014-11-12
10-Q	2014-07-04	Filed 2014-08-13
10-K	2014-04-04	Filed 2014-05-27
10-Q	2014-01-03	Filed 2014-02-12
10-Q	2013-10-04	Filed 2013-11-13
10-Q	2013-06-28	Filed 2013-08-07
10-K	2013-03-29	Filed 2013-05-24
10-Q	2012-12-28	Filed 2013-02-06
10-Q	2012-09-28	Filed 2012-11-07
10-Q	2012-06-29	Filed 2012-08-08
10-K	2012-03-30	Filed 2012-05-25
10-Q	2011-12-30	Filed 2012-02-08
10-Q	2011-09-30	Filed 2011-11-09
10-Q	2011-07-01	Filed 2011-08-10
10-K	2011-04-01	Filed 2011-05-27
10-Q	2010-12-31	Filed 2011-02-09
10-Q	2010-10-01	Filed 2010-11-10
10-Q	2010-07-02	Filed 2010-08-11
10-K	2010-04-02	Filed 2010-06-01
10-Q	2010-01-01	Filed 2010-02-10

8-K	2020-09-03	Officers, Shareholder Vote, Exhibits
8-K	2020-08-06	Earnings, Exhibits
8-K	2020-07-23	Sale of Shares, Regulation FD, Exhibits
8-K	2020-06-24
8-K	2020-06-17
8-K	2020-06-17
8-K	2020-05-26
8-K	2020-03-19
8-K	2020-02-06
8-K	2020-02-03
8-K	2019-11-25
8-K	2019-11-07
8-K	2019-09-04
8-K	2019-08-08
8-K	2019-05-23
8-K	2019-03-27
8-K	2019-03-20
8-K	2019-03-19
8-K	2019-02-28
8-K	2019-02-07
8-K	2019-01-18
8-K	2018-11-01
8-K	2018-10-03
8-K	2018-09-06
8-K	2018-08-09
8-K	2018-07-17
8-K	2018-05-24
8-K	2018-02-08
8-K	2018-01-08

EX-31.1	vsat-ex311_8.htm
EX-31.2	vsat-ex312_7.htm
EX-32.1	vsat-ex321_6.htm

VSAT 10Q Quarterly Report

Viasat Earnings 2020-06-30