Gogo Inc. shares jumped 6% in premarket trade Tuesday, after the provider of broadband services for airlines raised its long-term financial goals. Chicago-based Gogo said it now expects revenue to grow at a compounded annual growth rate of approximately 15% from 2020 to 2025, up from a previous target of at least 10% set on its fourth-quarter earnings call. The company expects to generate free cash flow of about $125 million in 2023, following the deployment of its Gogo 5G network in 2022, followed by about $200 million in 2025, up from a prior target of more than $100 million in 2023. “Growth in private air travel continues to expand, fueling what we expect will be sustained growth in demand for inflight connectivity as customers seek to replicate their home and office connectivity in the air,” said Oakleigh Thorne, chairman and CEO of Gogo. “That has driven record equipment sales at Gogo and is expected to generate growth in high-margin service revenue through our 2025 planning horizon.”
Shares have gained about 25% in the year to date, while the S&P 500 has gained 18%. Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
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