News and notes from Gogo's recent quarterly report.

Gogo reported another quarterly loss. Photo: Gogo. 

Gogo reported another quarterly loss. Photo: Gogo. 

Gogo, which provides internet for American, Delta, Alaska and other airlines, released its first quarter earnings on Friday. It reported a loss of $24.1 million, which means Gogo still has not turned a quarterly profit since its 2013 IPO.

Gogo has three business units, one for what it calls business aviation (mostly private jets), one for its airline business in North America and one for its airline business elsewhere.

Gogo says its business aviation and North America segments make money, while the rest-of-the-world business has lagged. Part of the reason, Gogo has said, is because it is still investing outside of the U.S. as it tries to win new customers. (British Airways parent IAG signed up this week.)

I suspect most readers use Gogo in North America, so I thought I would compile some interesting facts about the U.S. and Canadian business here. The data comes from Gogo's quarterly report. 

  • Gogo's 'take rate' - the percentage of people on each plane who bought the service - decreased in the first three months of 2016. A year ago, 7.2% of passengers bought Gogo internet. Now, that percentage is only 6.5%.

  • Why did the average 'take rate' decrease? Gogo says airlines have been adding its systems on regional jets, and on those smaller planes, fewer people buy WiFi. 

  • Gogo is making more money off of fewer customers. In the first three months of the year, it said it made an average of $13.05 per session, up from $11.73 in the same period last year. 

  • In North America, Gogo had 2,500 commercial airplanes outfitted with its systems at the end of the first quarter. This is 300 more than it had a the same time last year. 

  • Gogo's North America customers have the right to terminate the service for at least two reasons. 

    • Several airlines may "...terminate the contract if the percentage of passengers using connectivity on such airline’s flights falls below certain negotiated thresholds." (Gogo did not say what this threshold is.)

    • Delta, American and others may cancel contracts if "...another company provides an alternate connectivity service that is a material improvement," so long as Gogo is "unable to match the competitive offer in terms of price, technology and schedule." (American has already exercised this right on a contract for about 200 aircraft. But Gogo says it has approached American about upgrading the carrier's service so it does not switch to a competitor. It is waiting on American's decision.