10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the Quarterly Period Ended September 30, 2022

OR

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

Commission File Number 001-33963  

Iridium Communications Inc.

(Exact name of registrant as specified in its charter)

DE	26-1344998
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1750 Tysons Boulevard, Suite 1400, McLean, VA 22102

(Address of principal executive offices, including zip code)

703-287-7400

(Registrant’s telephone number, including area code)

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

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock, $0.001 par value	IRDM	The Nasdaq Stock Market LLC
		(Nasdaq Global Select Market)

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  x    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  x    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	x	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  x

The number of shares of the registrant’s common stock, par value $0.001 per share, outstanding as of October 13, 2022 was 125,642,535.

IRIDIUM COMMUNICATIONS INC.

TABLE OF CONTENTS

Item No.		Page
Part I. Financial Information
	Financial Statements:
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Operations and Comprehensive Income	4
	Condensed Consolidated Statements of Changes in Stockholders’ Equity	5
	Condensed Consolidated Statements of Cash Flows	6
	Notes to Condensed Consolidated Financial Statements	7
ITEM  2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
ITEM  3.	Quantitative and Qualitative Disclosures About Market Risk	28
ITEM  4.	Controls and Procedures	28
Part II. Other Information
ITEM  1.	Legal Proceedings	29
ITEM  1A.	Risk Factors	29
ITEM  2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
ITEM  3.	Defaults Upon Senior Securities	29
ITEM  4.	Mine Safety Disclosures	29
ITEM  5.	Other Information	29
ITEM  6.	Exhibits	30
	Signatures	31

2

PART I.

Iridium Communications Inc.

Condensed Consolidated Balance Sheets

(In thousands, except per share data)

	September 30, 2022		December 31, 2021
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	218,762	$	320,913
Accounts receivable, net	86,847		63,410
Inventory	39,222		29,044
Prepaid expenses and other current assets	13,395		11,043
Total current assets	358,226		424,410
Property and equipment, net	2,480,296		2,662,336
Other assets	181,235		50,050
Intangible assets, net	42,835		43,999
Total assets	$	3,062,592	$	3,180,795
Liabilities and stockholders’ equity
Current liabilities:
Short-term secured debt	$	16,500	$	16,500
Accounts payable	28,448		16,196
Accrued expenses and other current liabilities	46,066		48,122
Deferred revenue	35,822		28,018
Total current liabilities	126,836		108,836
Long-term secured debt, net	1,572,526		1,581,516
Deferred income tax liabilities, net	154,196		134,279
Deferred revenue, net of current portion	46,605		48,070
Other long-term liabilities	17,332		20,147
Total liabilities	1,917,495		1,892,848
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.001 par value, 300,000 shares authorized, 125,759 and 131,342 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	126		131
Additional paid-in capital	1,125,700		1,154,058
Retained earnings (accumulated deficit)	(37,763)		140,810
Accumulated other comprehensive income (loss), net of tax	57,034		(7,052)
Total stockholders’ equity	1,145,097		1,287,947
Total liabilities and stockholders’ equity	$	3,062,592	$	3,180,795

See notes to unaudited condensed consolidated financial statements.

3

Iridium Communications Inc.

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenue:
Services	$	138,977	$	127,774	$	397,947	$	365,247
Subscriber equipment	27,959		26,898		95,462		72,607
Engineering and support services	17,124		7,487		33,789		20,759
Total revenue	184,060		162,159		527,198		458,613
Operating expenses:
Cost of services (exclusive of depreciation and amortization)	34,378		25,186		83,796		71,784
Cost of subscriber equipment	18,406		15,544		60,382		41,243
Research and development	4,865		2,815		10,470		8,156
Selling, general and administrative	32,140		25,897		86,905		72,524
Depreciation and amortization	76,397		77,688		227,739		229,266
Total operating expenses	166,186		147,130		469,292		422,973
Operating income	17,874		15,029		57,906		35,640
Other expense, net:
Interest expense, net	(17,632)		(17,614)		(46,989)		(58,013)
Loss on extinguishment of debt	—		(879)		—		(879)
Other expense, net	(146)		(81)		(374)		(225)
Total other expense, net	(17,778)		(18,574)		(47,363)		(59,117)
Income (loss) before income taxes	96		(3,545)		10,543		(23,477)
Income tax benefit (expense)	2,053		1,460		(1,013)		20,042
Net income (loss)	$	2,149	$	(2,085)	$	9,530	$	(3,435)
Weighted average shares outstanding - basic	127,697		132,869		128,800		133,763
Weighted average shares outstanding - diluted	129,075		132,869		130,284		133,763
Net income (loss) attributable to common stockholders per share - basic and diluted	$	0.02	$	(0.02)	$	0.07	$	(0.03)
Comprehensive income:
Net income (loss)	$	2,149	$	(2,085)	$	9,530	$	(3,435)
Foreign currency translation adjustments	(366)		(592)		115		(171)
Unrealized gain on cash flow hedges, net of tax (see Note 6)	25,537		3,040		63,971		7,122
Comprehensive income	$	27,320	$	363	$	73,616	$	3,516

See notes to unaudited condensed consolidated financial statements.

4

Iridium Communications Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended September 30, 2022											Three Months Ended September 30, 2021
				Additional Paid-In Capital		Accumulated Other Comprehensive Income		Retained Earnings (Accumulated Deficit)		Total Stockholders' Equity					Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Total Stockholders' Equity
	Common Stock											Common Stock
	Shares	Amount										Shares	Amount
Balances at beginning of period	127,179	$	127	$	1,128,103	$	31,863	$	21,011	$	1,181,104	131,928	$	132	$	1,146,160	$	(12,677)	$	180,563	$	1,314,178
Stock-based compensation	—	—		15,573		—		—		15,573		—	—		8,150		—		—		8,150
Stock options exercised and awards vested	344	—		1,903		—		—		1,903		348	—		2,378		—		—		2,378
Stock withheld to cover employee taxes	(13)	—		(574)		—		—		(574)		(16)	—		(650)		—		—		(650)
Repurchases and retirements of common stock	(1,751)	(1)		(19,305)		—		(60,923)		(80,229)		(72)	—		(624)		—		(2,014)		(2,638)
Cumulative translation adjustments	—	—		—		(366)		—		(366)		—	—		—		(592)		—		(592)
Unrealized gain on cash flow hedges, net of tax	—	—		—		25,537		—		25,537		—	—		—		3,040		—		3,040
Net income (loss)	—	—		—		—		2,149		2,149		—	—		—		—		(2,085)		(2,085)
Balances at end of period	125,759	$	126	$	1,125,700	$	57,034	$	(37,763)	$	1,145,097	132,188	$	132	$	1,155,414	$	(10,229)	$	176,464	$	1,321,781

	Nine Months Ended September 30, 2022											Nine Months Ended September 30, 2021
				Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings (Accumulated Deficit)		Total Stockholders' Equity					Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Total Stockholders' Equity
	Common Stock											Common Stock
	Shares	Amount										Shares	Amount
Balances at beginning of period	131,342	$	131	$	1,154,058	$	(7,052)	$	140,810	$	1,287,947	134,056	$	134	$	1,160,570	$	(17,180)	$	275,915	$	1,419,439
Stock-based compensation	—	—		34,952		—		—		34,952		—	—		22,129		—		—		22,129
Stock options exercised and awards vested	1,080	1		2,572		—		—		2,573		1,626	1		7,192		—		—		7,193
Stock withheld to cover employee taxes	(117)	—		(4,598)		—		—		(4,598)		(131)	—		(5,390)		—		—		(5,390)
Repurchases and retirements of common stock	(6,546)	(6)		(61,284)		—		(188,103)		(249,393)		(3,363)	(3)		(29,087)		—		(96,016)		(125,106)
Cumulative translation adjustments	—	—		—		115		—		115		—	—		—		(171)		—		(171)
Unrealized gain on cash flow hedge, net of tax	—	—		—		63,971		—		63,971		—	—		—		7,122		—		7,122
Net income (loss)	—	—		—		—		9,530		9,530		—	—		—		—		(3,435)		(3,435)
Balances at end of period	125,759	$	126	$	1,125,700	$	57,034	$	(37,763)	$	1,145,097	132,188	$	132	$	1,155,414	$	(10,229)	$	176,464	$	1,321,781

See notes to unaudited condensed consolidated financial statements.

5

Iridium Communications Inc.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

	Nine Months Ended September 30,
	2022		2021
Cash flows from operating activities:
Net income (loss)	$	9,530	(3,435)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Deferred income taxes	(286)		(20,521)
Depreciation and amortization	227,739		229,266
Loss on extinguishment of debt	—		879
Stock-based compensation (net of amounts capitalized)	31,626		20,087
Amortization of deferred financing fees	3,488		3,025
All other items, net	450		(525)
Changes in operating assets and liabilities:
Accounts receivable	(23,109)		(8,702)
Inventory	(9,642)		9,408
Prepaid expenses and other current assets	(1,860)		(309)
Other assets	1,989		2,538
Accounts payable	13,071		(5,050)
Accrued expenses and other current liabilities	(711)		(2,386)
Interest payable	113		(69)
Deferred revenue	4,870		(8,312)
Other long-term liabilities	(2,810)		(2,757)
Net cash provided by operating activities	254,458		213,137
Cash flows from investing activities:
Capital expenditures	(44,756)		(28,016)
Investment in Aireon (see Note 12)	(50,000)		—
Purchases of other investments	—		(1,128)
Maturities of marketable securities	—		5,400
Net cash used in investing activities	(94,756)		(23,744)
Cash flows from financing activities:
Borrowings under the Term Loan	—		179,285
Payments on the Term Loan	(12,375)		(191,660)
Repurchases of common stock	(249,393)		(125,106)
Payment of deferred financing fees	—		(4,053)
Proceeds from exercise of stock options	2,573		7,193
Tax payment upon settlement of stock awards	(4,598)		(5,390)
Net cash used in financing activities	(263,793)		(139,731)
Effect of exchange rate changes on cash and cash equivalents, and restricted cash	1,940		164
Net increase (decrease) in cash and cash equivalents, and restricted cash	(102,151)		49,826
Cash, cash equivalents, and restricted cash, beginning of period	320,913		237,178
Cash, cash equivalents, and restricted cash, end of period	$	218,762	$	287,004
Supplemental cash flow information:
Interest paid, net of amounts capitalized	$	45,236	$	56,985
Income taxes paid, net	$	1,332	$	1,304
Supplemental disclosure of non-cash investing and financing activities:
Property and equipment received but not paid	$	4,282	$	4,941
Capitalized amortization of deferred financing costs	$	105	$	90
Capitalized stock-based compensation	$	3,326	$	2,042

See notes to unaudited condensed consolidated financial statements.

6

Iridium Communications Inc.

Notes to Condensed Consolidated Financial Statements

1. Basis of Presentation and Principles of Consolidation

Iridium Communications Inc. (the “Company”) has prepared its condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The Company's operations are primarily conducted through, and its operating assets are owned by, its principal operating subsidiary, Iridium Satellite LLC, Iridium Satellite's immediate parent, Iridium Holdings LLC, and their respective subsidiaries. The accompanying condensed consolidated financial statements include the accounts of (i) the Company, (ii) its wholly owned subsidiaries, and (iii) all less than wholly owned subsidiaries that the Company controls. All material intercompany transactions and balances have been eliminated.

In the opinion of management, the condensed consolidated financial statements reflect all normal recurring adjustments that the Company considers necessary for the fair presentation of its results of operations and cash flows for the interim periods covered, and of the financial position of the Company at the date of the interim condensed consolidated balance sheet. The operating results for interim periods are not necessarily indicative of the operating results for the entire year. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to instructions, rules and regulations prescribed by the U.S. Securities and Exchange Commission (“SEC”). These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2021, as filed with the SEC on February 17, 2022.

2. Significant Accounting Policies

Adopted and Recently Issued Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). The guidance provides optional expedients and exceptions for contracts, hedging relationships, and other transactions that reference London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued. ASU 2020-04 was further amended in January 2021 when the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”), which clarified the applicability of certain provisions. Both ASU 2020-04 and ASU 2021-01 are currently effective prospectively for all entities through December 31, 2022, when the reference rate replacement activity is expected to have been completed. The guidance in ASU 2020-04 and ASU 2021-01 is optional and may be elected over time as reference rate reform activities occur. During 2021, the Company elected to apply the optional expedient for hedge accounting specifically to the interest rate cap agreement (the "Cap") executed in July 2021 (see Note 6). This allowed the Company to assume that the index upon which future interest payments on the hedged portion of the Term Loan (see Note 5) will be based matches the index on the Cap. Adoption of this practical expedient had no impact on the Company's condensed consolidated financial statements upon adoption. The Company has not yet adopted any other expedients and will continue to evaluate the impact this standard may have on its consolidated financial statements.

Effective June 30, 2022, the Company adopted FASB ASU 2017-11, Earnings per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features (“ASU 2017-11”). Part I of ASU 2017-11 simplified the accounting for certain financial instruments with down round features, a provision in an equity-linked financial instrument (or embedded feature) that provides a downward adjustment of the current exercise price based on the price of future equity offerings. The Company also adopted FASB ASU 2020-06, Debt - Debt with Conversion and Other Options and Derivatives and Hedging (“ASU 2020-06”). ASU 2020-06 simplified the accounting for convertible debt instruments and convertible preferred stock by reducing the number of accounting models and limiting the number of embedded conversion features separately recognized from the primary contract. As a result of these adoptions, the Company was permitted to exclude the down-round feature of its investment in Aireon LLC (“Aireon”) from the consideration of whether the instrument is indexed to the entity's own stock (see Note 12).

Fair Value Measurements

The Company evaluates assets and liabilities subject to fair value measurements on a recurring and non-recurring basis to determine the appropriate level to classify them for each reporting period. This determination requires significant judgments to be made by management of the Company. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

7

The fair value hierarchy consists of the following tiers:

•Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

•Level 2, defined as observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

•Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying values of the following financial instruments approximated their fair values as of September 30, 2022 and December 31, 2021: (1) cash and cash equivalents, (2) prepaid expenses and other current assets, (3) accounts receivable, (4) accounts payable, and (5) accrued expenses and other current liabilities. Fair values approximate their carrying values because of their short-term nature. The Level 2 cash equivalents may include money market funds, commercial paper and short-term U.S. agency securities. The Company also classifies its derivative financial instruments as Level 2. The Company did not hold any Level 3 assets as of September 30, 2022 or December 31, 2021.

The fair values of the Company’s Level 2 estimates are based upon certain market assumptions and information available to the Company. In determining fair value, the Company uses a market approach utilizing valuation models that incorporate observable inputs such as interest rates, bond yields and quoted prices for similar assets.

Leases

For new leases, the Company will determine if an arrangement is or contains a lease at inception. Leases are included as (1) right-of-use (“ROU”) assets within other assets, and (2) ROU liabilities within accrued expenses and other liabilities and are included within other long-term liabilities on the Company’s condensed consolidated balance sheets.

ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Certain leases contain variable contractual obligations as a result of future base rate escalations which are estimated based on observed trends and included within the measurement of present value. The Company’s leases do not provide an implicit rate. The Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The ROU assets also include any lease payments made and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For certain leases, such as teleport network facilities, the Company elected the practical expedient to combine lease and non-lease components as a single lease component. Taxes assessed on leases in which the Company is either a lessor or lessee are excluded from contract consideration and variable payments when measuring new lease contracts or remeasuring existing lease contracts.

Inventory

Inventory consists primarily of finished goods and raw materials from third-party manufacturers. The Company outsources manufacturing of subscriber equipment to a third-party manufacturer and purchases accessories from third-party suppliers. The Company’s cost of inventory includes an allocation of overhead, including payroll and payroll-related costs of employees directly involved in bringing inventory to its existing condition, and freight. Inventories are valued using the average cost method and are carried at the lower of cost or net realizable value.

The Company has a manufacturing agreement with Benchmark Electronics Inc. (“Benchmark”) to manufacture most of its subscriber equipment. Pursuant to the agreement, the Company may be required to purchase excess materials at cost plus a contractual markup if the materials are not used in production within the periods specified in the agreement. Benchmark will then repurchase such materials from the Company at the same price paid by the Company, as required for the production of the subscriber equipment.

The following table summarizes the Company's inventory balances:

	September 30, 2022		December 31, 2021
	(In thousands)
Finished goods	$	13,375	$	18,395
Raw materials	26,910		11,850
Inventory valuation reserve	(1,063)		(1,201)
Total	$	39,222	$	29,044

8

Commitments

Launch and Related Services

In 2022, the Company entered into agreements with Space Exploration Technology Corp. and Thales Alenia Space France for launch and related services, to launch up to five of the Company's ground spare satellites. The Company expects costs related to this launch to total approximately $40.0 million. As of September 30, 2022, the Company had made aggregate payments of $8.2 million related to these services, which were capitalized as construction in progress within property and equipment, net in the accompanying condensed consolidated balance sheets. The Company currently expects the launch to occur in mid-2023.

Derivative Financial Instruments

The Company uses derivatives (interest rate swap, swaption and cap) to manage its exposure to fluctuating interest rate risk on variable rate debt. Its derivatives are measured at fair value and are recorded on the condensed consolidated balance sheets within other current liabilities and other assets. When the Company’s derivatives are designated as cash flow hedges, the effective portion of the changes in fair value of the derivatives are recorded in accumulated other comprehensive income (loss) within the Company’s condensed consolidated balance sheets and subsequently recognized in earnings when the hedged items impact earnings. Any ineffective portion of a derivative's change in fair value will be recognized in earnings in the same period in which the hedged interest payments affect earnings. Within the condensed consolidated statements of operations and comprehensive income, the gains and losses related to cash flow hedges are recognized within interest income (expense), net, as this is the same financial statement line item used for any gains or losses associated with the hedged items. Cash flows from hedging activities are included in operating activities within the Company’s condensed consolidated statements of cash flows, which is the same category as the item being hedged. See Note 6 for further information.

3. Cash and Cash Equivalents

Cash and Cash Equivalents

The following table presents the Company’s cash and cash equivalents balances:

	September 30, 2022		December 31, 2021		Recurring Fair Value Measurement
	(In thousands)
Cash and cash equivalents:
Cash	$	18,660	$	28,496
Money market funds	200,102		292,417		Level 2
Total cash and cash equivalents	$	218,762	$	320,913

4. Leases

Lessor Arrangements

Operating leases in which the Company is a lessor consist primarily of hosting agreements with Aireon (see Note 12) and L3Harris Technologies, Inc. (“L3Harris”) for space on the Company’s satellites. These agreements provide for a fee that will be recognized over the life of the satellites, currently estimated to be approximately 12.5 years. Lease income related to these agreements was $5.4 million for each of the three months ended September 30, 2022 and 2021, and $16.1 million for each of the nine months ended September 30, 2022 and 2021. Lease income is recorded as hosted payload and other data service revenue within service revenue on the Company’s condensed consolidated statements of operations and comprehensive income.

Aireon has made payments to the Company pursuant to its hosting agreement, and the Company expects Aireon will continue to do so. L3Harris has prepaid all amounts owed to the Company pursuant to its hosting arrangement. The following table presents future income with respect to the Company’s operating leases in which it is the lessor existing at September 30, 2022, exclusive of the $16.1 million recognized during the nine months ended September 30, 2022, by year and in the aggregate:

Year Ending December 31,	Amount
	(In thousands)
2022	$	5,361
2023	21,445
2024	21,445
2025	21,445
2026	21,445
Thereafter	77,462
Total lease income	$	168,603

9

5. Debt

Term Loan and Revolving Facility

In November 2019 and February 2020, pursuant to a loan agreement (as amended to date, the “Credit Agreement”), the Company entered into a term loan totaling $1,650.0 million in aggregate principal amount with Deutsche Bank AG (the “Term Loan”) and an accompanying $100.0 million revolving loan (the “Revolving Facility”). The Term Loan was repriced on multiple occasions and now bears interest at an annual rate of one-month LIBOR plus 2.50%, with a 0.75% LIBOR floor. The maturity date of the Term Loan is in November 2026. The interest rate on the Revolving Facility is LIBOR plus 3.75%, with no LIBOR floor, and the Revolving Facility has a maturity date in November 2024. Principal payments, payable quarterly, equal $16.5 million per annum (one percent of the full principal amount of the Term Loan), with the remaining principal due upon maturity.

As of September 30, 2022 and December 31, 2021, the Company reported an aggregate of $1,608.8 million and $1,621.1 million in borrowings under the Term Loan, respectively. These amounts do not include $19.8 million and $23.1 million of net unamortized deferred financing costs as of September 30, 2022 and December 31, 2021, respectively. The net principal balance in borrowings in the accompanying condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021 amounted to $1,589.0 million and $1,598.0 million, respectively. As of September 30, 2022 and December 31, 2021, based upon over-the-counter bid levels (Level 2 - market approach), the fair value of the borrowings under the Term Loan was $1,568.5 million and $1,622.1 million, respectively. The Company had not borrowed under the Revolving Facility as of September 30, 2022 and December 31, 2021.

The Credit Agreement restricts the Company’s ability to incur liens, engage in mergers or asset sales, pay dividends, repay subordinated indebtedness, incur indebtedness, make investments and loans, and engage in other transactions as specified in the Credit Agreement. The Credit Agreement provides for specified exceptions, including baskets measured as a percentage of trailing twelve months of earnings before interest, taxes, depreciation and amortization (“EBITDA” as defined in the Credit Agreement) and unlimited exceptions based on achievement and maintenance of specified leverage ratios, for, among other things, incurring indebtedness and liens and making investments, restricted payments for dividends and share repurchases, and payments of subordinated indebtedness. The Credit Agreement also contains a mandatory prepayment sweep mechanism with respect to a portion of the Company’s excess cash flow (as defined in the Credit Agreement), which is phased out based on achievement and maintenance of specified leverage ratios. As of December 31, 2021, the Company was below the specified leverage ratio, and a mandatory prepayment sweep was therefore not required with respect to 2021 cash flows.

The Credit Agreement contains no financial maintenance covenants with respect to the Term Loan. With respect to the Revolving Facility, the Credit Agreement requires the Company to maintain a consolidated first lien net leverage ratio (as defined in the Credit Agreement) of no greater than 6.25 to 1 if more than 35% of the Revolving Facility has been drawn. The Credit Agreement contains other customary representations and warranties, affirmative and negative covenants, and events of default. The Company was in compliance with all covenants as of September 30, 2022.

Interest on Debt

Total interest incurred includes amortization of deferred financing fees and capitalized interest. The following table presents the interest and amortization of deferred financing fees related to the Term Loan:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Total interest incurred	$	19,844	$	18,462	$	51,076	$	61,018
Amortization of deferred financing fees	$	1,211	$	1,148	$	3,593	$	3,115
Capitalized interest	$	725	$	438	$	1,589	$	1,795

As of September 30, 2022 and December 31, 2021, accrued interest on the Term Loan was $0.2 million and $0.1 million, respectively.

6. Derivative Financial Instruments

The Company is exposed to interest rate fluctuations related to its Term Loan. The Company has reduced its exposure to fluctuations in the cash flows associated with changes in the variable interest rate by entering into offsetting positions through the use of interest rate cap and swap contracts which result in recognizing a maximum fixed interest rate for a portion of the Term Loan. These instruments reduce the negative impact of increases in the variable rate over the term of the derivative contracts. These contracts are not used for trading or other speculative purposes. Historically, the Company has not incurred, and does not expect to incur in the future, any losses as a result of counterparty default.

Hedge effectiveness of interest rate swap and cap contracts is based on a long-haul hypothetical derivative methodology and includes all changes in value. The Company formally assesses, both at the hedge’s inception and on an ongoing quarterly basis,

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whether the designated derivative instruments are highly effective in offsetting changes in the cash flows of the hedged items. When the hedging instrument is sold, expires, is terminated, is exercised, no longer qualifies for hedge accounting, is de-designated, or is no longer probable, hedge accounting is discontinued prospectively.

Interest Rate Swap and Swaption

The Company previously entered into a long-term interest rate swap (“Swap”) to mitigate variability in forecasted interest payments on a portion of the Company’s borrowings under the Term Loan. The Swap expired in November 2021. Under the Swap, on the last business day of each month, the Company received variable interest payments based on one-month LIBOR from the counterparty. The Company paid a fixed rate of 1.565% per annum on the Swap.

The Company also entered into an interest rate swaption agreement (“Swaption”), for which the Company paid a fixed annual rate of 0.50%. At inception, the Swap and Swaption were designated as cash flow hedges for hedge accounting. The unrealized changes in market value were recorded in accumulated other comprehensive income (loss) and any remaining balance will be reclassified into earnings during the period in which the hedged transaction affects earnings. Due to the changes made to the Term Loan as a result of the July 2021 repricing, at that time the Company elected to de-designate the Swap as a cash flow hedge. Accordingly, as the related interest payments were still probable, the accumulated balance within other comprehensive income (loss) as of the de-designation date was amortized into earnings through the November 2021 expiration date.

The Company sold the Swaption in May 2021 for $0.7 million. The Company continued to pay the fixed annual rate for the Swaption through the term of the Swaption, which expired in November 2021.

Interest Rate Cap

In July 2021, the Company entered into the Cap that began in December 2021, following the expiration of the Swap. The Company entered into the Cap in order to manage its exposure to interest rate movements on a portion of the Term Loan through the maturity of the Term Loan in November 2026. The Cap provides the Company with the right to receive payment if one-month LIBOR exceeds 1.5%. As of December 2021, the Company began paying a fixed monthly premium based on an annual rate of 0.31% for the Cap. The Cap carried a notional amount of $1,000.0 million as of September 30, 2022 and December 31, 2021.

The Cap is designed to mirror the terms of the Term Loan and to offset the cash flows being hedged. The Company designated the Cap as a cash flow hedge of the variability of the LIBOR-based interest payments on the Term Loan. The effective portion of the Cap's change in fair value will be recorded in accumulated other comprehensive income (loss). Any ineffective portion of the Cap's change in fair value will be recorded in current earnings as interest expense.

Fair Value of Derivative Instruments

As of September 30, 2022 and December 31, 2021, the Company had an asset balance of $99.9 million and $19.7 million, respectively, for the fair value of the Cap and a liability balance of $11.7 million and $14.8 million, respectively, for the fair value of the Cap premium. Both the Cap and the Cap premium are recorded net within other assets.

During the three and nine months ended September 30, 2022, the Company collectively incurred $0.8 million and $2.5 million, respectively, in interest expense for the Swaption and Cap. This interest expense was reduced by $1.8 million for both the three and nine months ended September 30, 2022, for payments received related to the Cap. During the three and nine months ended September 30, 2021, the Company collectively incurred $1.8 million and $6.6 million, respectively, in net interest expense for the Swap and Swaption.

Gains and losses resulting from fair value adjustments to the Cap are recorded within accumulated other comprehensive income (loss) within the Company’s condensed consolidated balance sheets and reclassified to interest expense on the dates that interest payments become due. Cash flows related to the derivative contracts are included in cash flows from operating activities on the condensed consolidated statements of cash flows. Over the next 12 months, the Company expects any gains or losses for cash flow hedges amortized from accumulated other comprehensive income (loss) into earnings to have an immaterial impact on the Company’s consolidated financial statements.

The following table presents the amount of unrealized gain or loss and related tax impact associated with the derivative instruments that the Company recorded in its condensed consolidated statements of operations and comprehensive income:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Unrealized gain, net of tax	$	25,537	$	3,040	$	63,971	$	7,122
Tax expense	$	7,740	$	1,010	$	19,392	$	2,222

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7. Stock-Based Compensation

In May 2019, the Company’s stockholders approved the amendment and restatement of the Company’s 2015 Equity Incentive Plan (as so amended and restated, the “Amended 2015 Plan”). As of September 30, 2022, the remaining aggregate number of shares of the Company’s common stock available for future grants under the Amended 2015 Plan was 8,009,551. The Amended 2015 Plan provides for the grant of stock-based awards, including nonqualified stock options, incentive stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights and other equity securities to employees, consultants and non-employee directors of the Company and its affiliated entities. The number of shares of common stock available for issuance under the Amended 2015 Plan is reduced by (i) one share for each share of common stock issued pursuant to an appreciation award, such as a stock option or stock appreciation right with an exercise or strike price of at least 100% of the fair market value of the underlying common stock on the date of grant, and (ii) 1.8 shares for each share of common stock issued pursuant to any stock award that is not an appreciation award, also known as a “full value award.” The Amended 2015 Plan allows the Company to utilize a broad array of equity incentives and performance cash incentives in order to secure and retain the services of its employees, directors and consultants, and to provide long-term incentives that align the interests of its employees, directors and consultants with the interests of the Company’s stockholders. The Company accounts for stock-based compensation at fair value.

Stock Option Awards

The stock option awards granted to employees generally (i) have a term of ten years, (ii) vest over four years with 25% vesting after the first year of service and the remainder vesting ratably on a quarterly basis thereafter, (iii) are contingent upon employment on the vesting date, and (iv) have an exercise price equal to the fair market value of the underlying shares at the date of grant. The fair value of stock options is determined at the grant date using the Black-Scholes option pricing model.

The Company historically granted stock options to newly hired and promoted employees but now exclusively utilizes RSUs. The Company did not grant any stock options during the three and nine months ended September 30, 2022 or 2021.

Option Summary

A summary of the activity of the Company's stock options is as follows:

	Shares	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
	(In thousands, except years and per share data)
Options outstanding at December 31, 2021	1,681	$	9.35	3.28	$	53,698
Exercised	(314)	7.78			$	11,244
Forfeited	(2)	14.24
Options outstanding at September 30, 2022	1,365	$	9.70	2.81	$	47,312
Options exercisable at September 30, 2022	1,345	$	9.52	2.76	$	46,855
Options exercisable and expected to vest at September 30, 2022	1,365	$	9.70	2.81	$	47,310

	Shares	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
	(In thousands, except years and per share data)
Options outstanding at December 31, 2020	2,554	$	9.10	3.94	$	77,182
Cancelled or expired	(1)	7.78
Exercised	(844)	8.46			$	31,171
Forfeited	(11)	15.45
Options outstanding at September 30, 2021	1,698	$	9.38	3.54	$	51,755
Options exercisable at September 30, 2021	1,592	$	8.73	3.31	$	49,552
Options exercisable and expected to vest at September 30, 2021	1,698	$	9.37	3.54	$	51,732

Restricted Stock Units

The RSUs granted to employees for service generally vest over four years, with 25% vesting on the first anniversary of the grant date and the remainder vesting ratably on a quarterly basis thereafter, subject to continued employment. Some RSUs granted to employees for performance vest upon the completion of defined performance goals, subject to continued

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employment. The RSUs granted to non-employee members of the board of directors generally vest in full on the first anniversary of the grant date. The RSUs granted to non-employee consultants generally vest 50% on the first anniversary of the grant date, with the remaining 50% vesting quarterly thereafter through the second anniversary of the grant date. The Company’s RSUs are classified as equity awards because the RSUs will be settled in the Company’s common stock upon vesting. The fair value of the RSUs is determined at the grant date based on the closing price of the Company's common stock on the date of grant. The related compensation expense is recognized over the service period, or shorter periods based on the retirement eligibility of certain grantees, and is based on the grant date fair value of the Company’s common stock and the number of shares expected to vest. The fair value of the awards is not remeasured at the end of each reporting period. The RSUs do not carry voting rights until they are vested, and shares are issued upon settlement in accordance with the terms of the award.

RSU Summary

The following tables summarize the Company’s RSU activity:

	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2021	2,550	$	25.80
Granted	1,491	40.02
Forfeited	(127)	31.85
Released	(766)	32.73
Outstanding at September 30, 2022	3,148	$	30.60
Vested and unreleased at September 30, 2022 (1)	885

	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2020	2,664	$	18.96
Granted	843	41.67
Forfeited	(90)	28.41
Released	(782)	21.22
Outstanding at September 30, 2021	2,635	$	25.23
Vested and unreleased at September 30, 2021 (1)	860

(1)     These RSUs were granted to the Company's board of directors as a part of their compensation for board and committee service, as detailed below, and had vested but had not yet settled, meaning that the underlying shares of common stock had not been issued and released pursuant to the terms of the applicable compensation program.

Service-Based RSUs

The majority of the annual compensation the Company provides to non-employee members of its board of directors is paid in the form of RSUs. In addition, some members of the Company’s board of directors may elect to receive the remainder of their annual compensation, or a portion thereof, in the form of RSUs. An aggregate amount of approximately 57,000 and 39,000 service-based RSUs were granted to the Company’s non-employee members of the board of directors as a result of these payments and elections during the nine months ended September 30, 2022 and 2021, respectively, with an estimated grant date fair value of $2.2 million and $1.6 million, respectively.

During the nine months ended September 30, 2022 and 2021, the Company granted approximately 1,012,000 and 461,000 service-based RSUs, respectively, to its employees, with an estimated aggregate grant date fair value of $41.0 million and $19.2 million, respectively.

During the nine months ended September 30, 2022 and 2021, the Company granted approximately 7,000 and 2,000 service-based RSUs, respectively, to non-employee consultants, with an estimated aggregate grant date fair value of $0.3 million and $0.1 million, respectively.

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Performance-Based RSUs

In March 2022 and 2021, the Company granted approximately 248,000 and 228,000 annual incentive, performance-based RSUs, respectively, to the Company’s executives and employees (the “Bonus RSUs”), with an estimated grant date fair value of $9.7 million and $9.5 million, respectively. Vesting of the Bonus RSUs is and was dependent upon the Company’s achievement of defined performance goals over the respective fiscal year. The Company records stock-based compensation expense related to performance-based RSUs when it is considered probable that the performance conditions will be met. Management believes it is probable that substantially all of the 2022 Bonus RSUs will vest. The level of achievement, if any, of performance goals will be determined by the compensation committee of the Company’s board of directors and, if such goals are achieved, the 2022 Bonus RSUs will vest, subject to continued employment, in March 2023. All of the 2021 Bonus RSUs vested in March 2022 upon the determination of the level of achievement of the performance goals.

Additionally, in March 2022 and 2021, the Company granted approximately 167,000 and 110,000 long-term, performance-based RSUs, respectively, to the Company’s executives (the “Executive RSUs”). The estimated aggregate grant date fair value of the Executive RSUs for the 2022 and 2021 grants was $6.5 million and $4.6 million, respectively. Vesting of the Executive RSUs is dependent upon the Company’s achievement of defined performance goals over a two-year period. The vesting of Executive RSUs will ultimately range from 0% to 150% of the number of shares underlying the Executive RSUs granted based on the level of achievement of the performance goals. If the Company achieves the performance goals, 50% of the number of Executive RSUs earned based on performance will vest on the second anniversary of the grant date, and the remaining 50% will vest on the third anniversary of the grant date, in each case subject to the executive’s continued service as of the vesting date, which may be accelerated based on the retirement eligibility of certain grantees. During March 2022, approximately 50,000 shares underlying performance-based RSUs granted to the Company’s executives in 2020 were forfeited as a result of performance metrics not being fully achieved. During March 2021, the Company awarded approximately 3,000 additional shares related to performance-based RSUs granted in 2019 to the Company's executives for over-achievement of performance targets.

8. Equity Transactions

Preferred Stock

The Company is authorized to issue 2.0 million shares of preferred stock with a par value of $0.0001 per share. The Company previously issued 1.5 million shares of preferred stock, all of which have converted to common stock. The remaining 0.5 million authorized shares of preferred stock remain undesignated and unissued as of September 30, 2022 and December 31, 2021. As of September 30, 2022 and December 31, 2021, there were no outstanding shares of preferred stock.

Share Repurchases and Retirement

In February 2021, the Company implemented a stock repurchase program for up to $300.0 million of its common stock through December 31, 2022. In March 2022, the Company expanded the repurchase program to include up to an additional $300.0 million of its common stock through December 31, 2023. This timeframe can be extended or shortened by the board of directors. Repurchases may be made from time to time on the open market at prevailing prices or in negotiated transactions off the market. All shares are immediately retired upon repurchase in accordance with the board-approved policy. When treasury shares are retired, the Company’s policy is to allocate the excess of the repurchase price over the par value of shares acquired first, to additional paid-in capital, and then to retained earnings. The portion to be allocated to additional paid-in capital is calculated by applying a percentage, determined by dividing the number of shares to be retired by the number of shares outstanding, to the balance of additional paid-in capital as of the date of retirement.

The Company repurchased and subsequently retired 1.8 million and 6.5 million shares of its common stock during the three and nine months ended September 30, 2022, respectively, for a total purchase price of $76.5 million and $245.7 million, respectively. In addition, in September 2022, the Company repurchased 0.1 million shares for approximately $3.7 million, which were not settled and retired until October 2022. As such, these shares are recorded as treasury stock as of September 30, 2022. The Company repurchased and subsequently retired 0.1 million and 3.4 million shares of its common stock during the three and nine months ended September 30, 2021, respectively, for a total purchase price of $2.6 million and $125.1 million, respectively. As of September 30, 2022, $187.2 million remained available and authorized for repurchase under the stock repurchase program approved in March 2022.

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9. Revenue

The following table summarizes the Company’s services revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Commercial services revenue:
Voice and data	$	50,256	$	45,737	$	143,621	$	130,444
IoT data	33,786		30,040		92,857		82,018
Broadband	13,589		11,461		37,200		31,531
Hosted payload and other data	14,846		14,649		44,769		43,867
Total commercial services revenue	112,477		101,887		318,447		287,860
Government services revenue	26,500		25,887		79,500		77,387
Total services revenue	$	138,977	$	127,774	$	397,947	$	365,247

The following table summarizes the Company’s engineering and support services revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Commercial	$	1,783	$	1,249	$	4,280	$	2,978
Government	15,341		6,238		29,509		17,781
Total engineering and support services revenue	$	17,124	$	7,487	$	33,789	$	20,759

Approximately 30% and 34% of the Company's accounts receivable balance at September 30, 2022 and December 31, 2021, respectively, was due from prime contracts or subcontracts with agencies of the U.S. government.

The Company's contracts with customers generally do not contain performance obligations with terms in excess of one year. As such, the Company does not disclose details related to the value of performance obligations that are unsatisfied as of the end of the reporting period. The total value of any performance obligations that extend beyond one year is immaterial to the financial statements.

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and deferred revenue (contract liabilities) on the condensed consolidated balance sheets. The Company bills amounts under its agreed-upon contractual terms at periodic intervals (for services), upon shipment (for equipment), or upon achievement of contractual milestones or as work progresses (for engineering and support services). Billing may occur subsequent to revenue recognition, resulting in unbilled accounts receivable (contract assets). The Company may also receive payments from customers before revenue is recognized, resulting in deferred revenue (contract liabilities). The Company recognized revenue that was previously recorded as deferred revenue in the amounts of $5.5 million and $10.6 million for the three months ended September 30, 2022 and 2021, respectively, and $21.1 million and $32.4 million during the nine months ended September 30, 2022 and 2021. The Company has also recorded costs of obtaining contracts expected to be recovered in prepaid expenses and other current assets (contract assets or commissions), that are not separately disclosed on the condensed consolidated balance sheets. The commissions are recognized over the estimated usage period. The following table presents contract assets not separately disclosed:

	September 30, 2022		December 31, 2021
	(In thousands)
Contract Assets:
Commissions	$	1,471	$	1,190
Other contract costs	$	2,330	$	2,558
Unbilled receivables	$	14,693	$	10,752

10. Income Taxes

Income before income taxes was $0.1 million and $10.5 million for the three and nine months ended September 30, 2022, respectively, while the income tax benefit was $2.1 million for the three months ended September 30, 2022 and the income tax expense was $1.0 million for the nine months ended September 30, 2022. The effective tax rate for the three and nine months ended September 30, 2022, differed from the federal statutory rate of 21% primarily due to U.S. tax credits, a discrete tax benefit associated with stock compensation and a discrete tax benefit from the U.S. provision-to-return adjustment in the

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current period, partially offset by tax expense associated with nondeductible executive compensation and non-creditable foreign taxes.

Loss before income taxes was $3.5 million and $23.5 million for the three and nine months ended September 30, 2021, respectively, while the income tax benefit was $1.5 million and $20.0 million for the three and nine months ended September 30, 2021, respectively. The effective tax rate for the three-month period ended September 30, 2021, differed from the federal statutory rate of 21% primarily due to the net impact of a discrete tax benefit associated with the stock compensation tax deduction and the decrease to the prior year valuation allowance for state net operating losses, offset by a discrete state tax expense associated with state apportionment changes. The effective tax rate for the nine-month period ended September 30, 2021, differed from the federal statutory rate of 21% primarily due to the net impact of the discrete state tax benefit associated with state apportionment changes, a stock compensation tax deduction and the Company's U.S. tax credits.

11. Net Income (Loss) Per Share

The Company calculates basic net income (loss) per share by dividing net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. In periods of net income, diluted net income per share takes into account the effect of potential dilutive common shares when the effect is dilutive. Potentially dilutive common shares include (i) shares of common stock issuable upon exercise of outstanding stock options and (ii) contingently issuable RSUs that are convertible into shares of common stock upon achievement of certain service and performance requirements. The effect of potentially dilutive common shares is computed using the treasury stock method. The RSUs granted to members of the Company’s board of directors contain non-forfeitable rights to dividends and therefore are considered to be participating securities in periods of net income. The income attributable to the RSUs was immaterial for the periods presented, and as a result, the calculation of basic and diluted net income per share excludes net income attributable to the unvested RSUs granted to the Company’s board of directors from the numerator and excludes the impact of the unvested RSUs granted to the Company’s board of directors from the denominator.

The following table summarizes the computations of basic and diluted net income (loss) per share:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands, except per share data)
Numerator:
Net income (loss) - basic and diluted	$	2,149	$	(2,085)	9,530		(3,435)
Denominator:
Weighted average common shares - basic	127,697		132,869		128,800		133,763
Dilutive effect of stock options	921		—		974		—
Dilutive effect of RSUs	457		—		510		—
Weighted average common shares - diluted	129,075		132,869		130,284		133,763
Net income (loss) per share - basic and diluted	$	0.02	$	(0.02)	$	0.07	$	(0.03)

Due to the Company’s net loss position for the three and nine months ended September 30, 2021, all potential common stock equivalents were anti-dilutive and therefore excluded from the calculation of diluted net loss per share. The following table presents the incremental number of shares underlying stock options and RSUs outstanding with anti-dilutive effects:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
	(In thousands)		(In thousands)
Performance-based RSUs	—	49	—	101
Service-based RSUs	—	404	—	547
Stock options	—	1,130	—	1,236

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12. Related Party Transactions

Aireon LLC and Aireon Holdings LLC

The Company's satellite constellation hosts the Aireon® system, which provides a global air traffic surveillance service through a series of automatic dependent surveillance-broadcast (“ADS-B”) receivers. The Company formed Aireon in 2011, with subsequent investments from the air navigation service providers (“ANSPs”) of Canada, Italy, Denmark, Ireland and the United Kingdom, to develop and market this service. The Company and other Aireon investors hold their interests in Aireon through the Amended and Restated Aireon Holdings LLC agreement (the “Aireon Holdings LLC Agreement”). Aireon Holdings LLC holds 100% of the membership interests in Aireon, which is the operating entity.

In June 2022, the Company entered into a subscription agreement with Aireon and invested $50 million in exchange for a 6% preferred interest. The Company's investment in Aireon is accounted for as an equity method investment. The carrying value of the Company's investment in Aireon was $50 million as of September 30, 2022. The original investments by the Company were previously written down to a carrying value of zero.

As of September 30, 2022 and December 31, 2021, the Company's fully diluted ownership stake in Aireon Holdings was approximately 39.5% and 35.7%, respectively, and is subject to redemption provisions contained in the Aireon Holdings LLC Agreement.

Aireon has contracted to pay the Company a fee to host the ADS-B receivers on its constellation, as well as fees for power and data services in connection with the delivery of the air traffic surveillance data. Pursuant to an agreement with Aireon (the “Hosting Agreement”), Aireon will pay the Company fees of $200.0 million to host the ADS-B receivers, of which $70.5 million had been paid as of September 30, 2022, as well as power fees of up to approximately $3.7 million per year. Aireon also pays data services fees of $19.8 million per year for the delivery of the air traffic surveillance data under a data transmission services agreement. Pursuant to ASU 2016-02, the Company considers the Hosting Agreement an operating lease. The Company recognized $4.0 million of hosting fee revenue for each of the three months ended September 30, 2022 and 2021 and $12.0 million for each of the nine months ended September 30, 2022 and 2021. Aireon receivables under the Hosting Agreement totaled $3.6 million as of September 30, 2022. There were no such receivables as of December 31, 2021. The Company recorded power and data service revenue from Aireon of $5.9 million for each of the three months ended September 30, 2022 and 2021 and $17.6 million for each of the nine months ended September 30, 2022 and 2021.

Under two services agreements, the Company also provides Aireon with administrative services and support services, the fees for which are paid monthly. Aireon receivables due to the Company under these two agreements totaled $2.1 million and $2.2 million as of September 30, 2022 and December 31, 2021, respectively.

The Company and the other Aireon investors have agreed to participate pro-rata, based on their fully diluted ownership stakes, in funding an investor bridge loan to Aireon. The Company’s maximum funding commitment for the bridge loan is $10.7 million. No bridge loan amounts were outstanding as of September 30, 2022 or December 31, 2021.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

You should read the following discussion along with our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed on February 17, 2022 with the Securities and Exchange Commission, or the SEC, as well as our condensed consolidated financial statements included in this Form 10-Q.

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking statements include those that express plans, anticipation, intent, contingencies, goals, targets or future development or otherwise are not statements of historical fact. Without limiting the foregoing, the words “believe,” “anticipate,” “plan,” “expect,” “intend” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on our current expectations and projections about future events, and they are subject to risks and uncertainties, known and unknown, that could cause actual results and developments to differ materially from those expressed or implied in such statements. The important factors described under the caption “Risk Factors” in this report and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed on February 17, 2022, could cause actual results to differ materially from those indicated by forward-looking statements made herein. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview of Our Business

We are engaged primarily in providing mobile voice and data communications services using a constellation of orbiting satellites. We are the only commercial provider of communications services offering true global coverage, connecting people, organizations and assets to and from anywhere, in real time. Our low-earth orbit (LEO), L-band network provides reliable, weather-resilient communications services to regions of the world where terrestrial wireless or wireline networks do not exist or are limited, including remote land areas, open ocean, airways, the polar regions, and regions where the telecommunications infrastructure has been affected by political conflicts or natural disasters.

We provide voice and data communications services to businesses, the U.S. and foreign governments, non-governmental organizations and consumers via our satellite network, which has an architecture of 66 operational satellites with in-orbit and ground spares and related ground infrastructure. We utilize an interlinked mesh architecture to route traffic across the satellite constellation using radio frequency crosslinks between satellites. This unique architecture minimizes the need for ground facilities to support the constellation, which facilitates the global reach of our services and allows us to offer services in countries and regions where we have no physical presence.

We sell our products and services to commercial end-users through a wholesale distribution network, encompassing approximately 110 service providers, approximately 290 value-added resellers, or VARs, and approximately 90 value-added manufacturers, or VAMs, which create and sell technology that uses the Iridium® network either directly to the end user or indirectly through other service providers, VARs or dealers. These distributors often integrate our products and services with other complementary hardware and software and have developed a broad suite of applications using our products and services to target specific lines of business. We expect that demand for our services will increase as more applications are developed and deployed that utilize our technology.

At September 30, 2022, we had approximately 1,973,000 billable subscribers worldwide, representing an increase of 17% from approximately 1,690,000 billable subscribers at September 30, 2021. We have a diverse customer base, with end users in the following lines of business: land mobile, maritime, aviation, Internet of Things, or IoT, hosted payloads and other data services and the U.S. government.

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Material Trends and Uncertainties

Our industry and customer base have historically grown as a result of:

•demand for remote and reliable mobile communications services;

•a growing number of new products and services and related applications;

•a broad wholesale distribution network with access to diverse and geographically dispersed niche markets;

•increased demand for communications services by disaster and relief agencies, and emergency first responders;

•improved data transmission speeds for mobile satellite service offerings;

•regulatory mandates requiring the use of mobile satellite services;

•a general reduction in prices of mobile satellite services and subscriber equipment; and

•geographic market expansion through the ability to offer our services in additional countries.

Nonetheless, we face a number of challenges and uncertainties in operating our business, including:

•our ability to maintain the health, capacity, control and level of service of our satellites;

•our ability to develop and launch new and innovative products and services;

•changes in general economic, business and industry conditions, including the effects of currency exchange rates;

•our reliance on a single primary commercial gateway and a primary satellite network operations center;

•competition from other mobile satellite service providers and, to a lesser extent, from the expansion of terrestrial-based cellular phone systems and related pricing pressures;

•market acceptance of our products;

•regulatory requirements in existing and new geographic markets;

•challenges associated with global operations, including as a result of conflicts in or affecting markets in which we operate;

•rapid and significant technological changes in the telecommunications industry;

•our ability to generate sufficient internal cash flows to repay our debt;

•reliance on our wholesale distribution network to market and sell our products, services and applications effectively;

•reliance on a global supply chain, including single-source suppliers for the manufacture of most of our subscriber equipment and for some of the components required in the manufacture of our end-user subscriber equipment and our ability to purchase component parts that are periodically subject to shortages resulting from surges in demand, natural disasters or other events, including the COVID-19 pandemic; and

•reliance on a few significant customers, particularly agencies of the U.S. government, for a substantial portion of our revenue, as a result of which the loss or decline in business with any of these customers may negatively impact our revenue and collectability of related accounts receivable.

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Comparison of Our Results of Operations for the Three Months Ended September 30, 2022 and 2021

	Three Months Ended September 30,								Change
	2022		% of Total Revenue		2021		% of Total Revenue
($ in thousands)									Dollars		Percent
Revenue:
Services	$	138,977	76	%	$	127,774	78	%	$	11,203	9	%
Subscriber equipment	27,959		15	%	26,898		17	%	1,061		4	%
Engineering and support services	17,124		9	%	7,487		5	%	9,637		129	%
Total revenue	184,060		100	%	162,159		100	%	21,901		14	%
Operating expenses:
Cost of services (exclusive of depreciation
and amortization)	34,378		19	%	25,186		16	%	9,192		36	%
Cost of subscriber equipment	18,406		10	%	15,544		10	%	2,862		18	%
Research and development	4,865		3	%	2,815		2	%	2,050		73	%
Selling, general and administrative	32,140		16	%	25,897		16	%	6,243		24	%
Depreciation and amortization	76,397		42	%	77,688		47	%	(1,291)		(2)	%
Total operating expenses	166,186		90	%	147,130		91	%	19,056		13	%
Operating income	17,874		10	%	15,029		9	%	2,845		19	%
Other expense:
Interest expense, net	(17,632)		(10)	%	(17,614)		(10)	%	(18)		—	%
Loss on extinguishment of debt	—		—	%	(879)		(1)	%	879		(100)	%
Other expense, net	(146)		—	%	(81)		—	%	(65)		80	%
Total other expense, net	(17,778)		(10)	%	(18,574)		(11)	%	796		(4)	%
Income (loss) before income taxes	96		—	%	(3,545)		(2)	%	3,641		(103)	%
Income tax benefit	2,053		1	%	1,460		1	%	593		41	%
Net income (loss)	$	2,149	1	%	$	(2,085)	(1)	%	$	4,234	(203)	%

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Revenue

Commercial Service Revenue 

	Three Months Ended September 30,
	2022					2021					Change
	Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers	ARPU
	(Revenue in millions and subscribers in thousands)
Commercial services:
Voice and data	$	50.3	401	$	42	$	45.7	372	$	41	$	4.6	29	$	1
IoT data	33.8		1,412	8.24		30.0		1,156	8.93		3.8		256	(0.69)
Broadband (3)	13.6		14.7	315		11.5		13.0	299		2.1		1.7	16
Hosted payload and other data	14.8		N/A			14.7		N/A			0.1		N/A
Total commercial services	$	112.5	1,828			$	101.9	1,541			$	10.6	287

(1)Billable subscriber numbers shown are at the end of the respective period.

(2)Average monthly revenue per unit, or ARPU, is calculated by dividing revenue in the respective period by the average of the number of billable subscribers at the beginning of the period and the number of billable subscribers at the end of the period and then dividing the result by the number of months in the period. Billable subscriber and ARPU data is not applicable for hosted payload and other data service revenue items.

(3)Commercial broadband service consists of Iridium OpenPort® and Iridium Certus® broadband services.

For the three months ended September 30, 2022, total commercial services revenue increased $10.6 million, or 10%, from the prior year period primarily as a result of increases in voice and data, IoT and broadband. These increases were driven primarily by increases in billable subscribers across all commercial service lines. Commercial voice and data revenue increased $4.6 million, or 10%, for the three months ended September 30, 2022, compared to the same period of the prior year, primarily due to an increase in volume across all postpaid and prepaid voice and data services. Commercial IoT revenue increased $3.8 million, or 12%, for the three months ended September 30, 2022, compared to the same period of the prior year, driven by a 22% increase in IoT billable subscribers primarily due to continued strength in consumer personal communications devices. The effect on revenue of increased subscribers was partially offset by an 8% reduction in IoT ARPU, primarily due to the shifting mix of subscribers using lower ARPU plans, including the increased proportion of personal communications subscribers. Commercial broadband revenue increased $2.1 million, or 19%, for the three months ended September 30, 2022, compared to the prior year period, due to the increase in broadband billable subscribers and an increase in ARPU associated with the increase in the mix of subscribers utilizing higher ARPU Iridium Certus broadband plans. Hosted payload and other service revenue remained relatively flat compared to the prior year period.

Government Service Revenue 

	Three Months Ended September 30,
	2022			2021			Change
	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers
	(Revenue in millions and subscribers in thousands)
Government services	$	26.5	145	$	25.9	149	$	0.6	(4)

(1)Billable subscriber numbers shown 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 contract, or the 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. The annual rate under the EMSS Contract increased from $103.0 million to $106.0 million during the third quarter of 2021, which caused the increase in revenue of $0.6 million compared to the prior year period.

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Subscriber Equipment Revenue

Subscriber equipment revenue increased by $1.1 million, or 4%, for the three months ended September 30, 2022, compared to the prior year period, primarily due to an increase in the volume of IoT device sales.

Engineering and Support Service Revenue

	Three Months Ended September 30,
	2022		2021		Change
	(In millions)
Commercial engineering and support services	$	1.8	$	1.3	$	0.5
Government engineering and support services	15.3		6.2		9.1
Total engineering and support services	$	17.1	$	7.5	$	9.6

Engineering and support service revenue increased by $9.6 million, or 129%, for the three months ended September 30, 2022, compared to the prior year period, primarily due to increased work under certain government contracts, primarily the contract awarded by the Space Development Agency, or the SDA. Based on the SDA contract, we expect engineering and support service revenue, as well as associated expenses, to be higher than prior years for the remainder of 2022 and in coming years.

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 $9.2 million, or 36%, for the three months ended September 30, 2022 from the prior year period, primarily as a result of the increase in work under certain government engineering contracts, as noted above.

Cost of Subscriber Equipment

Cost of subscriber equipment includes the direct costs of equipment sold, which consist of manufacturing costs, allocation of overhead, and warranty costs.

Cost of subscriber equipment increased by $2.9 million, or 18%, for the three months ended September 30, 2022, compared to the prior year period primarily due to an increase in volume of IoT device sales, as noted above. The percentage increase of subscriber equipment costs exceeded the percentage increase in subscriber equipment revenue primarily due to an increase in inventory component costs.

Research and Development

Research and development expenses increased by $2.1 million, or 73%, for the three months ended September 30, 2022, compared to the prior year period based on increased spending on device-related features for our network.

Selling, General and Administrative

Selling, general and administrative expenses that are not directly attributable to the sale of services or products include sales and marketing costs, as well as employee-related expenses (such as salaries, wages, and benefits), legal, finance, information technology, facilities, billing and customer care expenses.

Selling, general and administrative expenses increased by $6.2 million, or 24%, for the three months ended September 30, 2022, compared to the prior year period, primarily due to higher management incentive, including equity compensation costs, and increased marketing and travel expenses incurred in the current year quarter as compared to the prior year quarter. We expect selling, general and administrative expense to increase by approximately 20% in 2022 primarily related to stock compensation costs.

Depreciation and Amortization

Depreciation and amortization expense remained relatively flat compared to the prior year period. We anticipate depreciation and amortization expense to remain relatively consistent from quarter to quarter based on our anticipated capital expenditures.

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Other Expense

Interest Expense, Net

Interest expense, net was relatively flat at $17.6 million for the three months ended September 30, 2022, compared to the prior year period. Interest expense increased based on the change in LIBOR, net of the hedging activity, offset by a decrease in third-party financing costs in connection with the repricings in 2021 that did not recur in 2022.

Loss on Extinguishment of Debt

Loss on extinguishment of debt was $0.9 million for the three months ended September 30, 2021. During July 2021, we repriced our Term Loan and wrote off unamortized debt issuance costs related to several lenders who did not participate in the repricing and whose portions of the Term Loan were replaced by new or existing lenders. There was no extinguishment of debt during the current year period.

Income Taxes

For the three months ended September 30, 2022, our income tax benefit was $2.1 million, compared to $1.5 million for the prior year period. The increase in income tax benefit is primarily related to the net impact of (i) pre-tax book income in the current period compared to pre-tax book loss in the prior year period, (ii) a discrete tax benefit associated with the U.S. provision-to-return adjustment in the current period compared to a discrete tax expense in the prior year period, and (iii) an increased stock compensation tax benefit.

Net Income (Loss)

Net income was $2.1 million for the three months ended September 30, 2022, compared to net loss of $2.1 million for the prior year period. The change was primarily the result of the $2.8 million increase in operating income.

Comparison of Our Results of Operations for the Nine Months Ended September 30, 2022 and 2021

	Nine Months Ended September 30,								Change
	2022		% of Total Revenue		2021		% of Total Revenue
($ in thousands)									Dollars		Percent
Revenue:
Services	$	397,947	76	%	$	365,247	79	%	$	32,700	9	%
Subscriber equipment	95,462		18	%	72,607		16	%	22,855		31	%
Engineering and support services	33,789		6	%	20,759		5	%	13,030		63	%
Total revenue	527,198		100	%	458,613		100	%	68,585		15	%
Operating expenses:
Cost of services (exclusive of depreciation
and amortization)	83,796		16	%	71,784		16	%	12,012		17	%
Cost of subscriber equipment	60,382		11	%	41,243		9	%	19,139		46	%
Research and development	10,470		2	%	8,156		2	%	2,314		28	%
Selling, general and administrative	86,905		17	%	72,524		16	%	14,381		20	%
Depreciation and amortization	227,739		43	%	229,266		49	%	(1,527)		(1)	%
Total operating expenses	469,292		89	%	422,973		92	%	46,319		11	%
Operating income	57,906		11	%	35,640		8	%	22,266		62	%
Other expense:
Interest expense, net	(46,989)		(9)	%	(58,013)		(13)	%	11,024		(19)	%
Loss on extinguishment of debt	—		—	%	(879)		—	%	879		(100)	%
Other expense, net	(374)		—	%	(225)		—	%	(149)		66	%
Total other expense, net	(47,363)		(9)	%	(59,117)		(13)	%	11,754		(20)	%
Income (loss) before income taxes	10,543		2	%	(23,477)		(5)	%	34,020		(145)	%
Income tax benefit (expense)	(1,013)		—	%	20,042		4	%	(21,055)		(105)	%
Net income (loss)	$	9,530	2	%	$	(3,435)	(1)	%	$	12,965	(377)	%

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Revenue

Commercial Service Revenue 

	Nine Months Ended September 30,
	2022					2021					Change
	Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers	ARPU
	(Revenue in millions and subscribers in thousands)
Commercial services:
Voice and data	$	143.6	401	$	41	$	130.4	372	$	40	$	13.2	29	$	1
IoT data	92.8		1,412	7.92		82.0		1,156	8.60		10.8		256	(0.68)
Broadband (3)	37.2		14.7	297		31.5		13	284		5.7		1.7	13
Hosted payload and other data	44.8		N/A			43.9		N/A			0.9		N/A
Total commercial services	$	318.4	1,828			$	287.8	1,541			$	30.6	287

(1)Billable subscriber numbers shown are at the end of the respective period.

(2)Average monthly revenue per unit, or ARPU, is calculated by dividing revenue in the respective period by the average of the number of billable subscribers at the beginning of the period and the number of billable subscribers at the end of the period and then dividing the result by the number of months in the period. Billable subscriber and ARPU data is not applicable for hosted payload and other data service revenue items.

(3)Commercial broadband service consists of Iridium OpenPort and Iridium Certus broadband services.

For the nine months ended September 30, 2022, total commercial services revenue increased $30.6 million, or 11%, from the prior year period primarily as a result of increases in voice and data, IoT and broadband mainly driven by increases in billable subscribers. Commercial voice and data revenue increased $13.2 million, or 10%, from the prior year period primarily due to an increase in volume across all voice and data services. Commercial IoT revenue increased $10.8 million, or 13%, for the nine months ended September 30, 2022, compared to the prior year period, driven by a 22% increase in IoT billable subscribers primarily due to continued strength in personal communications devices. The subscriber increase effect on revenue was partially offset by a 8% reduction in IoT ARPU, primarily due to the shifting mix of subscribers using lower ARPU plans, including the increased proportion of personal communication subscribers. Commercial broadband revenue increased $5.7 million, or 18%, for the nine months ended September 30, 2022, compared to the prior year period, due to the increase in broadband billable subscribers and an increase in ARPU associated with the increase in the mix of subscribers utilizing higher ARPU Iridium Certus broadband plans.

Government Service Revenue 

	Nine Months Ended September 30,
	2022			2021			Change
	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers
	(Revenue in millions and subscribers in thousands)
Government services	$	79.5	145	$	77.4	149	$	2.1	(4)

(1)Billable subscriber numbers shown 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 contract, or the 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. The annual rate under the EMSS Contract increased from $103.0 million to $106.0 million during the third quarter of 2021, which caused the increase of $2.1 million compared to the prior year period.

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Subscriber Equipment Revenue

Subscriber equipment revenue increased by $22.9 million, or 31%, for the nine months ended September 30, 2022, compared to the prior year period, primarily due to an increase in the volume of all device sales.

Engineering and Support Service Revenue

	Nine Months Ended September 30,
	2022		2021		Change
	(In millions)
Commercial engineering and support services	$	4.3	$	3.0	$	1.3
Government engineering and support services	29.5		17.8		11.7
Total engineering and support services	$	33.8	$	20.8	$	13.0

Engineering and support service revenue increased $13.0 million, or 63%, for the nine months ended September 30, 2022 compared to the prior year period primarily due to increased work under certain government projects, including the SDA contract noted above. Based on the SDA contract, we expect engineering and support service revenue, as well as associated expenses, to be generally higher than prior years for the remainder of 2022 and in coming years.

Operating Expenses

Cost of Services (exclusive of depreciation and amortization)

Cost of services (exclusive of depreciation and amortization) increased by $12.0 million, or 17%, for the nine months ended September 30, 2022 from the prior year period, primarily as a result of an increase in work under certain government engineering contracts, as noted above, and higher satellite operation costs.

Cost of Subscriber Equipment

Cost of subscriber equipment increased by $19.1 million, or 46%, for the nine months ended September 30, 2022 compared to the prior year period primarily due to an increase in volume of all device sales, as noted above. The percentage increase of subscriber equipment costs exceeded the percentage increase in subscriber equipment revenue primarily due increased inventory component costs and a change in mix.

Research and Development

Research and development expenses increased by $2.3 million, or 28%, for the nine months ended September 30, 2022 compared to the prior year period based on increased spending on device-related features for our network.

Selling, General and Administrative

Selling, general and administrative expenses increased by $14.4 million, or 20%, for the nine months ended September 30, 2022 compared to the prior year period, primarily due to higher management incentive, including equity compensation costs and increased marketing and travel expenses incurred in the current year period as compared to the prior year period. We expect selling, general and administrative expense to increase by approximately 20% in 2022 primarily related to stock compensation costs.

Depreciation and Amortization

Depreciation and amortization expense remained relatively flat compared to the prior year period. We anticipate depreciation and amortization expense to remain relatively consistent from quarter to quarter based on our anticipated capital expenditures.

Other Expense

Interest Expense, Net

Interest expense, net decreased $11.0 million for the nine months ended September 30, 2022 compared to the prior year period. The decrease resulted primarily from decreases in the interest rate on our Term Loan as a result of the repricings in January 2021 and July 2021. As the repricing events occurred in 2021, third-party financing costs decreased $3.6 million in the current year.

Loss on Extinguishment of Debt

Loss on extinguishment of debt was $0.9 million for the nine months ended September 30, 2021. During July 2021, we repriced our Term Loan, and wrote off unamortized debt issuance costs related to several lenders who did not participate in the repricing and whose portions of the Term Loan were replaced by new or existing lenders. There was no extinguishment of debt during the current year period.

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Income Taxes

For the nine months ended September 30, 2022, our income tax expense was $1.0 million, compared to income tax benefit of $20.0 million for the prior year period. The increase in income tax expense is primarily related to the net impact of (i) pre-tax book income in the current period compared to pre-tax book loss in the prior year period, (ii) the net impact of a discrete state tax benefit associated with a state apportionment change in the prior year period, (iii) a decreased stock compensation tax benefit, and (iv) a discrete tax benefit associated with the U.S. provision-to-return adjustment in the current period compared to a discrete tax expense in the prior year period.

Net Income (Loss)

Net income was $9.5 million for the nine months ended September 30, 2022, compared to net loss of $3.4 million for the prior year period. The change primarily resulted from the $22.3 million increase in operating income, as well as the $11.0 million decrease in interest expense, net. These changes were offset by the $21.1 million increase in income tax expense as described above.

Liquidity and Capital Resources

In November 2019 and February 2020, we borrowed a total of $1,650.0 million in aggregate principal amount under a term loan with Deutsche Bank AG, or the Term Loan, with an accompanying $100.0 million revolving loan available to us, or the Revolving Facility. Both facilities are under a credit agreement with the lenders, or the Credit Agreement. As repriced to date, the Term Loan bears interest at an annual rate of LIBOR plus 2.50%, with a 0.75% LIBOR floor. All other terms of the Term Loan remain the same as before the repricings, including maturity in November 2026. The interest rate on the Revolving Facility is LIBOR plus 3.75% with no LIBOR floor, and the Revolving Facility has a maturity date in November 2024. See Note 5 to our condensed consolidated financial statements included in this report for further discussion of the Term Loan and Revolving Facility.

As of September 30, 2022, we reported an aggregate balance of $1,608.8 million in borrowings under the Term Loan, before $19.8 million of net deferred financing costs, for a net principal balance of $1,589.0 million outstanding in our condensed consolidated balance sheet. We have not drawn on our Revolving Facility.

Our Term Loan contains no financial maintenance covenants. With respect to the Revolving Facility, we are required to maintain a consolidated first lien net leverage ratio of no greater than 6.25 to 1 if more than 35% of the Revolving Facility has been drawn. The Credit Agreement contains other customary representations and warranties, affirmative and negative covenants, and events of default. We were in compliance with all covenants under the Credit Agreement as of September 30, 2022.

The Credit Agreement restricts our ability to incur liens, engage in mergers or asset sales, pay dividends, repay subordinated indebtedness, incur indebtedness, make investments and loans, and engage in other transactions as specified in the Credit Agreement. The Credit Agreement provides for specified exceptions, including baskets measured as a percentage of trailing twelve months of earnings before interest, taxes, depreciation and amortization, or EBITDA (as defined in the Credit Agreement), and unlimited exceptions based on achievement and maintenance of specified leverage ratios, for, among other things, incurring indebtedness and liens and making investments, restricted payments for dividends and share repurchases, and payments of subordinated indebtedness. The Credit Agreement permits repayment, prepayment, and repricing transactions. The Credit Agreement also contains a mandatory prepayment sweep mechanism with respect to a portion of our excess cash flow (as defined in the Credit Agreement), which is phased out based on achievement and maintenance of specified leverage ratios. As of December 31, 2021, our leverage ratio was below the specified level, and we were not required to make a mandatory prepayment with respect to 2021 cash flows.

We entered into an interest rate cap agreement, or the Cap, that began in December 2021. The Cap manages our exposure to interest rate movements on a portion of our Term Loan. The Cap provides the right to receive payment if one-month LIBOR exceeds 1.5%. Under the Cap, we pay a fixed monthly premium at an annual rate of 0.31%. The Cap carried a notional amount of $1,000.0 million as of September 30, 2022. The Cap is designed to mirror the terms of the Term Loan and to offset the cash flows being hedged. We designated the Cap as a cash flow hedge of the variability of the LIBOR-based interest payments on the Term Loan. The effective portion of the Cap's change in fair value will be recorded in accumulated other comprehensive income (loss) and will be reclassified into earnings during the period in which the hedged transaction affects earnings. See Note 6 to our condensed consolidated financial statements included in this report for further discussion of the Cap and our prior derivative financial instruments.

As of September 30, 2022, we had entered into non-cancelable purchase obligations of approximately $63.4 million for inventory purchases with Benchmark Electronics, Inc., our primary third-party vendor. Our purchase obligations, all of which are due during 2022, increased by $31.4 million from December 31, 2021 due to increased demand and recovery from supply-chain constraints experienced during 2021.

As of September 30, 2022, our total cash and cash equivalents balance was $218.8 million, down from $320.9 million as of December 31, 2021, principally as a result of the $249.4 million in repurchases of our common stock and $94.8 million of

26

investing activities during the nine months ended September 30, 2022, offset by internally generated cash flows. We also had $100.0 million of borrowing availability under our Revolving Facility. In addition to the Revolving Facility, our principal sources of liquidity are internally generated cash flows. Other than the purchase obligation noted above, our principal liquidity requirements over the next twelve months are primarily (i) required principal and interest on the Term Loan, which we expect to be $16.5 million and, based on the current interest rate, approximately $70.0 million, respectively, (ii) capital expenditures of approximately $75.0 million, depending on costs in connection with the potential launch of ground spare satellites, and (iii) working capital. In our discretion, we may also make share repurchases under the share repurchase program described in Note 8 to the financial statements included in this report, although we have no obligation to do so.

We believe our liquidity sources will provide sufficient funds for us to meet our liquidity requirements for at least the next 12 months.

Our material long-term cash requirement is the repayment of the remaining principal amount under the Term Loan upon its maturity in 2026, which is expected to be $1,555.1 million. We expect to refinance this amount at or prior to maturity.

Cash Flows

The following table summarizes our cash flows:

	Nine Months Ended September 30,
	2022		2021		Change
	(In thousands)
Cash provided by operating activities	$	254,458	$	213,137	$	41,321
Cash used in investing activities	$	(94,756)	$	(23,744)	$	(71,012)
Cash used in financing activities	$	(263,793)	$	(139,731)	$	(124,062)

Cash Flows Provided by Operating Activities

Net cash provided by operating activities for the nine months ended September 30, 2022 increased $41.3 million from the prior year period. Net income (loss), as adjusted for non-cash activities, improved by $43.8 million over the prior year, as a result of improved profitability and an increase in non-cash activities. This was offset by a decrease in working capital of approximately $2.5 million. Cash flows from working capital decreased primarily related to an increase in raw material inventory as we experienced component shortages which are awaiting production. Working capital also decreased because of an increase in accounts receivable due to increased sales across all revenue types. These changes in working capital were offset by changes in deferred revenue related to timing of scheduled payments from Aireon and accounts payable related to the increase in work under certain government projects.

Cash Flows Used in Investing Activities

Net cash used in investing activities for the nine months ended September 30, 2022 increased by $71.0 million as compared to the prior year period due to the $50.0 million investment in Aireon (see Note 12) and increased capital expenditures. We continue to expect our capital expenditures to average approximately $40.0 million per year until 2029, exclusive of any costs we may incur to launch our ground spares.

Cash Flows Used in Financing Activities

Net cash used in financing activities for the nine months ended September 30, 2022 increased by $124.1 million compared to the prior year period primarily due to an increase in cash used for the repurchases of our common stock in 2022 as compared to 2021 (see Note 8).

Seasonality

Our results of operations have been subject to seasonal usage changes for commercial customers, and our results will be affected by similar seasonality going forward. March through October are typically the peak months for commercial voice services revenue and related subscriber equipment sales. U.S. government revenue and commercial IoT revenue have been less subject to seasonal usage changes.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations is based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP. The preparation of these financial statements requires the use of estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, useful lives of property and equipment, long-lived assets and other intangible assets, deferred financing costs, income taxes, stock-based compensation, and other estimates. We base our estimates on historical experience and on various other assumptions that we believe to be

27

reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. There have been no changes to our critical accounting policies and estimates from those described in our Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on February 17, 2022.

Recent Accounting Pronouncements

Refer to Note 2 to our condensed consolidated financial statements for a full description of recent accounting pronouncements and recently adopted pronouncements.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

We had an outstanding aggregate balance of $1,608.8 million under the Term Loan as of September 30, 2022. Our Cap began in December 2021, which manages our exposure to interest rate movements on a portion of our Term Loan. The Cap provides the right to receive payment if one-month LIBOR exceeds 1.5%. For the portion of the Term Loan not covered under our hedging arrangements, we pay interest at an annual rate equal to the London Interbank Offered Rate, or LIBOR, plus 2.5%, with a 0.75% LIBOR floor. Accordingly, we have been and continue to be subject to interest rate fluctuations. In July, the one-month LIBOR has increased to over the level of the Cap. As a result of the interest rate rising from the LIBOR floor to the level of the Cap, we expect our annual interest expense to increase by approximately $12.0 million, or approximately $3.0 million per quarter. For every LIBOR increase of 25 basis points above the level of the Cap, we expect our annual interest expense to increase by an additional $1.5 million related to the unhedged portion of the Term Loan.

We have not borrowed under our Revolving Facility. Accordingly, although the Revolving Facility bears interest at LIBOR plus 3.75%, without a LIBOR floor, if and as drawn, we are not currently exposed to fluctuations in interest rates with respect to our Revolving Facility.

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, as well as accounts receivable. We maintain our cash and cash equivalents with financial institutions with high credit ratings and at times maintain the balance of our deposits in excess of federally insured limits. A significant portion of our cash is held in a money market fund invested in U.S. treasuries, agency mortgage-backed securities and/or U.S. government-guaranteed debt. Accounts receivable are due from both domestic and international customers. We perform credit evaluations of our customers’ financial condition and record reserves to provide for estimated credit losses. Accounts payable are owed to both domestic and international vendors.

ITEM 4.    CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our chief executive officer, who is our principal executive officer, and our chief financial officer, who is our principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, as of the end of the period covered by this report. In evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. In addition, the design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a control system, misstatements due to error or fraud may occur and not be detected.

Based on this evaluation, our chief executive officer and our chief financial officer concluded that our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms, and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting

During the quarter ended September 30, 2022, there were no changes in our internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

28

PART II.

OTHER INFORMATION 

ITEM 1.    LEGAL PROCEEDINGS.

There are no material pending legal proceedings, other than ordinary routine litigation incidental to our business.

ITEM 1A.     RISK FACTORS.

Our business is subject to risks and events that, if they occur, could adversely affect our financial condition and results of operations and the trading price of our securities. In addition to the other information set forth in this quarterly report on Form 10-Q, you should carefully consider the factors described in “Part I, Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission on February 17, 2022, as supplemented by the following updated risk factor.

Our Russian operations have been and may continue to be affected by Russia's invasion of Ukraine and related sanctions imposed in response, and we may in the future choose or be required to further limit or shut down those operations entirely.

We provide satellite communications services in Russia through two local subsidiaries employing 34 people and authorized Russian service providers, using a dedicated gateway in Russia. In 2021, revenue from our operations in Russia represented approximately 2.3% of our total revenue, including approximately 2.5% of our total service revenue and 2.4% of our equipment revenue. As a result of Russia's invasion of Ukraine in February 2022, we have ceased shipment of equipment to Russia, as well as making other adjustments to our operations in light of U.S. and international sanctions. Further, our sales in Russia are conducted in rubles and then translated to U.S. dollars in our financial results. The value of the ruble has fluctuated substantially since the invasion, which may affect our reported revenues. As a result of these factors, we expect revenue from our operations in Russia to be variable and difficult to predict.

In addition, we may in the future choose or be required to further limit or cease operations in Russia entirely, in which case we will no longer receive any revenue from those operations. We could also incur significant expenses as a result of the process of shutting down operations in Russia.

ITEM 2.     UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Issuer Purchases of Equity Securities

Period	(a) Total number of shares purchased	(b) Average price paid per share	(c) Total number of shares purchased as part of publicly announced plans or programs	(d) Maximum dollar value) of shares that may yet be purchased under the plans or programs
July 1-31	337,137	$38.72	337,137	$254.4 million
August 1-31	334,917	$45.19	334,917	$239.3 million
September 1-30	1,162,160	$44.76	1,162,160	$187.2 million
Total	1,834,214	$43.73	1,834,214	—

In February 2021, our board of directors approved the repurchase of up to $300.0 million of our common stock through December 31, 2022. In April 2022, the original February 2021 authorization was exhausted. In March 2022, our board of directors approved the repurchase of up to an additional $300.0 million of our common stock through December 31, 2023. All shares listed above were purchased under these authorizations in open market transactions.

ITEM 3.     DEFAULTS UPON SENIOR SECURITIES.

None. 

ITEM 4.     MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5.     OTHER INFORMATION.

None.

29

ITEM 6.     EXHIBITS.

The following list of exhibits includes exhibits submitted with this Form 10-Q as filed with the Securities and Exchange Commission.

Exhibit	Description
31.1	Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to section 302 of The Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to section 302 of The Sarbanes-Oxley Act of 2002.
32.1**	Certifications of Principal Executive Officer and Principal Financial Officer pursuant to Rules 13a-14(b) and 15d-14(b) promulgated under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to section 906 of The Sarbanes-Oxley Act of 2002.
101	The following financial information from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, filed with the Securities and Exchange Commission on October 20, 2022, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets at September 30, 2022 and December 31, 2021; (ii) Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2022 and 2021; (iii) Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and nine months ended September 30, 2022 and 2021; (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021; and (iv) Notes to Condensed Consolidated Financial Statements.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

** These certifications are being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

30

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

IRIDIUM COMMUNICATIONS INC.
By:	/s/ Thomas J. Fitzpatrick
	Thomas J. Fitzpatrick
	Chief Financial Officer (as duly authorized officer and as principal financial officer of the registrant)

 Date: October 20, 2022

31

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002

I, Matthew J. Desch, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Iridium Communications Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 20, 2022	/s/ Matthew J. Desch
	Matthew J. Desch
	Chief Executive Officer (principal executive officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002

I, Thomas J. Fitzpatrick, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Iridium Communications Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 20, 2022	/s/ Thomas J. Fitzpatrick
	Thomas J. Fitzpatrick
	Chief Financial Officer (principal financial officer)

EX-32.1

Exhibit 32.1

CERTIFICATIONS OF

PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the Chief Executive Officer and the Chief Financial Officer of Iridium Communications Inc. (the “Company”) each hereby certifies that, to the best of his knowledge:

1. The Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, to which this Certification is attached as Exhibit 32.1 (the “Quarterly Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Quarterly Report fairly presents, in all material respects, the financial condition of the Company at the end of the period covered by the Quarterly Report and results of operations of the Company for the periods covered in the financial statements in the Quarterly Report.

Dated:  October 20, 2022

/s/ Matthew J. Desch	/s/ Thomas J. Fitzpatrick
Matthew J. Desch	Thomas J. Fitzpatrick
Chief Executive Officer	Chief Financial Officer

This certification accompanies the Quarterly Report and shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

XML

Document And Entity Information - $ / shares	9 Months Ended
	Sep. 30, 2022	Oct. 13, 2022	Dec. 31, 2021
Document Information [Line Items]
Entity Registrant Name	Iridium Communications Inc.
Entity Central Index Key	0001418819
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Trading Symbol	IRDM
Entity Current Reporting Status	Yes
Document Quarterly Report	true
Document Type	10-Q
Amendment Flag	false
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Document Period End Date	Sep. 30, 2022
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2022
Entity Address, Address Line One	1750 Tysons Boulevard
Entity Address, City or Town	McLean
Entity Address, State or Province	VA
Entity Address, Postal Zip Code	22102
Document Transition Report	false
City Area Code	703
Local Phone Number	703-287-7400
Entity File Number	001-33963
Entity Incorporation, State or Country Code	DE
Entity Interactive Data Current	Yes
Title of 12(b) Security	Common Stock, $0.001 par value
Common Stock, Par or Stated Value Per Share	$ 0.001		$ 0.001
Entity Common Stock, Shares Outstanding (in shares)		125,642,535
Entity Tax Identification Number	26-1344998
NASDAQ/NGS (GLOBAL SELECT MARKET) [Member]
Document Information [Line Items]
Security Exchange Name	NASDAQ

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 218,762	$ 320,913
Accounts receivable, net	86,847	63,410
Inventory	39,222	29,044
Prepaid expenses and other current assets	13,395	11,043
Total current assets	358,226	424,410
Property and equipment, net	2,480,296	2,662,336
Other assets	181,235	50,050
Intangible assets, net	42,835	43,999
Total assets	3,062,592	3,180,795
Current liabilities:
Short-term secured debt	16,500	16,500
Accounts payable	28,448	16,196
Accrued expenses and other current liabilities	46,066	48,122
Deferred revenue	35,822	28,018
Total current liabilities	126,836	108,836
Long-term secured debt, net	1,572,526	1,581,516
Deferred income tax liabilities, net	154,196	134,279
Deferred revenue, net of current portion	46,605	48,070
Other long-term liabilities	17,332	20,147
Total liabilities	1,917,495	1,892,848
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.001 par value, 300,000 shares authorized, 125,759 and 131,342 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	126	131
Additional paid-in capital	1,125,700	1,154,058
Retained earnings (accumulated deficit)	(37,763)	140,810
Accumulated other comprehensive income (loss), net of tax	57,034	(7,052)
Total stockholders’ equity	1,145,097	1,287,947
Total liabilities and stockholders’ equity	$ 3,062,592	$ 3,180,795

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
Common Stock, Par or Stated Value Per Share	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	300,000,000	300,000,000
Common stock, shares issued (in shares)	125,759,000	131,342,000
Common stock, shares outstanding (in shares)	125,759,000	131,342,000

XML

Condensed Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenue:
Total revenue	$ 184,060	$ 162,159	$ 527,198	$ 458,613
Operating expenses:
Research and development	4,865	2,815	10,470	8,156
Selling, general and administrative	32,140	25,897	86,905	72,524
Depreciation and amortization	76,397	77,688	227,739	229,266
Total operating expenses	166,186	147,130	469,292	422,973
Operating income	17,874	15,029	57,906	35,640
Other expense, net:
Interest expense, net	(17,632)	(17,614)	(46,989)	(58,013)
Loss on extinguishment of debt	0	(879)	0	(879)
Other expense, net	(146)	(81)	(374)	(225)
Total other expense, net	(17,778)	(18,574)	(47,363)	(59,117)
Income (loss) before income taxes	96	(3,545)	10,543	(23,477)
Income tax benefit (expense)	2,053	1,460	(1,013)	20,042
Net income (loss)	$ 2,149	$ (2,085)	$ 9,530	$ (3,435)
Weighted Average Number of Shares Outstanding, Basic	127,697	132,869	128,800	133,763
Weighted Average Number of Shares Outstanding, Diluted	129,075	132,869	130,284	133,763
Earnings Per Share, Basic and Diluted	$ 0.02	$ (0.02)	$ 0.07	$ (0.03)
Comprehensive income:
Net income (loss)	$ 2,149	$ (2,085)	$ 9,530	$ (3,435)
Foreign currency translation adjustments	(366)	(592)	115	(171)
Unrealized Gain on Cash Flow Hedging, net of tax	25,537	3,040	63,971	7,122
Comprehensive income	$ 27,320	$ 363	$ 73,616	$ 3,516
Earnings Per Share, Diluted	$ 0.04	$ 0.03	$ 0.06	$ (0.01)
Services
Revenue:
Total revenue	$ 138,977	$ 127,774	$ 397,947	$ 365,247
Operating expenses:
Cost of Goods and Services Sold	34,378	25,186	83,796	71,784
Subscriber equipment
Revenue:
Total revenue	27,959	26,898	95,462	72,607
Operating expenses:
Cost of Goods and Services Sold	18,406	15,544	60,382	41,243
Engineering and support services
Revenue:
Total revenue	$ 17,124	$ 7,487	$ 33,789	$ 20,759

XML

Consolidated Statements of Changes in Stockholders' Equity Statement - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock, Shares [Member]	Common Stock, Amount	Additional Paid-in Capital [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]
Beginning Balance (in shares) at Dec. 31, 2020		134,056
Beginning Balance at Dec. 31, 2020	$ 1,419,439		$ 134	$ 1,160,570	$ (17,180)	$ 275,915
Stock-based compensation	22,129			22,129
Stock options exercised and awards vested (in shares)		1,626
Stock options exercised and awards vested	7,193		1	7,192
Stock withheld to cover employee taxes (in shares)		(131)
Stock withheld to cover employee taxes	(5,390)			(5,390)
Repurchases and retirements of common stock (in shares)		(3,363)
Repurchases and retirements of common stock	(125,106)		(3)	(29,087)		(96,016)
Cumulative translation adjustment	(171)				(171)
Unrealized Gain on Cash Flow Hedging, net of tax	7,122				7,122
Net income (loss)	(3,435)					(3,435)
Ending Balance (in shares) at Sep. 30, 2021		132,188
Ending Balance at Sep. 30, 2021	1,321,781		132	1,155,414	(10,229)	176,464
Beginning Balance (in shares) at Jun. 30, 2021		131,928
Beginning Balance at Jun. 30, 2021	1,314,178		132	1,146,160	(12,677)	180,563
Stock-based compensation	8,150			8,150
Stock options exercised and awards vested (in shares)		348
Stock options exercised and awards vested	2,378		0	2,378
Stock withheld to cover employee taxes (in shares)		(16)
Stock withheld to cover employee taxes	(650)			(650)
Repurchases and retirements of common stock (in shares)		(72)
Repurchases and retirements of common stock	(2,638)		0	(624)		(2,014)
Cumulative translation adjustment	(592)				(592)
Unrealized Gain on Cash Flow Hedging, net of tax	3,040				3,040
Net income (loss)	(2,085)					(2,085)
Ending Balance (in shares) at Sep. 30, 2021		132,188
Ending Balance at Sep. 30, 2021	1,321,781		132	1,155,414	(10,229)	176,464
Beginning Balance (in shares) at Dec. 31, 2021		131,342
Beginning Balance at Dec. 31, 2021	1,287,947		131	1,154,058	(7,052)	140,810
Stock-based compensation	34,952			34,952
Stock options exercised and awards vested (in shares)		1,080
Stock options exercised and awards vested	2,573		1	2,572
Stock withheld to cover employee taxes (in shares)		(117)
Stock withheld to cover employee taxes	(4,598)			(4,598)
Repurchases and retirements of common stock (in shares)		(6,546)
Repurchases and retirements of common stock	(249,393)		(6)	(61,284)		(188,103)
Cumulative translation adjustment	115				115
Unrealized Gain on Cash Flow Hedging, net of tax	63,971				63,971
Net income (loss)	9,530					9,530
Ending Balance (in shares) at Sep. 30, 2022		125,759
Ending Balance at Sep. 30, 2022	1,145,097		126	1,125,700	57,034	(37,763)
Beginning Balance (in shares) at Jun. 30, 2022		127,179
Beginning Balance at Jun. 30, 2022	1,181,104		127	1,128,103	31,863	21,011
Stock-based compensation	15,573			15,573
Stock options exercised and awards vested (in shares)		344
Stock options exercised and awards vested	1,903		0	1,903
Stock withheld to cover employee taxes (in shares)		(13)
Stock withheld to cover employee taxes	(574)			(574)
Repurchases and retirements of common stock (in shares)		(1,751)
Repurchases and retirements of common stock	(80,229)		(1)	(19,305)		(60,923)
Cumulative translation adjustment	(366)				(366)
Unrealized Gain on Cash Flow Hedging, net of tax	25,537				25,537
Net income (loss)	2,149					2,149
Ending Balance (in shares) at Sep. 30, 2022		125,759
Ending Balance at Sep. 30, 2022	$ 1,145,097		$ 126	$ 1,125,700	$ 57,034	$ (37,763)

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash flows from operating activities:
Net income (loss)	$ 9,530	$ (3,435)
Deferred income taxes	(286)	(20,521)
Depreciation and amortization	227,739	229,266
Stock-based compensation (net of amounts capitalized)	31,626	20,087
Amortization of deferred financing fees	3,488	3,025
All other items, net	450	(525)
Accounts receivable	(23,109)	(8,702)
Inventory	(9,642)	9,408
Prepaid expenses and other current assets	(1,860)	(309)
Other assets	1,989	2,538
Accounts payable	13,071	(5,050)
Accrued expenses and other current liabilities	(711)	(2,386)
Interest Payable	113	(69)
Deferred revenue	4,870	(8,312)
Other long-term liabilities	(2,810)	(2,757)
Net cash provided by operating activities	254,458	213,137
Cash flows from investing activities:
Capital expenditures	(44,756)	(28,016)
Payments to Acquire Equity Method Investments	(50,000)	0
Purchases of other investments	0	(1,128)
Maturities of marketable securities	0	5,400
Net cash used in investing activities	(94,756)	(23,744)
Cash flows from financing activities:
Payments on the Term Loan	(12,375)	(191,660)
Repurchases of common stock	(249,393)	(125,106)
Payments of Debt Issuance Costs	0	(4,053)
Proceeds from exercise of stock options	2,573	7,193
Tax payment upon settlement of stock awards	4,598	5,390
Net cash used in financing activities	(263,793)	(139,731)
Effect of Exchange Rate on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	1,940	164
Net increase (decrease) in cash and cash equivalents, and restricted cash	(102,151)	49,826
Cash, cash equivalents, and restricted cash, beginning of period	320,913	237,178
Cash, cash equivalents, and restricted cash, end of period	218,762	287,004
Supplemental cash flow information:
Interest paid, net of amounts capitalized	45,236	56,985
Income taxes paid, net	1,332	1,304
Supplemental disclosure of non-cash investing activities:
Property and equipment received but not paid	4,282	4,941
Capitalized amortization of deferred financing costs	105	90
Capitalized stock-based compensation	3,326	2,042
Borrowings under the Term Loan	$ 0	$ 179,285

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Basis of Presentation and Principles of Consolidation

9 Months Ended

Sep. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

Iridium Communications Inc. (the “Company”) has prepared its condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The Company's operations are primarily conducted through, and its operating assets are owned by, its principal operating subsidiary, Iridium Satellite LLC, Iridium Satellite's immediate parent, Iridium Holdings LLC, and their respective subsidiaries. The accompanying condensed consolidated financial statements include the accounts of (i) the Company, (ii) its wholly owned subsidiaries, and (iii) all less than wholly owned subsidiaries that the Company controls. All material intercompany transactions and balances have been eliminated.

In the opinion of management, the condensed consolidated financial statements reflect all normal recurring adjustments that the Company considers necessary for the fair presentation of its results of operations and cash flows for the interim periods covered, and of the financial position of the Company at the date of the interim condensed consolidated balance sheet. The operating results for interim periods are not necessarily indicative of the operating results for the entire year. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to instructions, rules and regulations prescribed by the U.S. Securities and Exchange Commission (“SEC”). These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2021, as filed with the SEC on February 17, 2022.

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Significant Accounting Policies

9 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

Significant Accounting Policies

Significant Accounting Policies

Adopted and Recently Issued Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). The guidance provides optional expedients and exceptions for contracts, hedging relationships, and other transactions that reference London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued. ASU 2020-04 was further amended in January 2021 when the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”), which clarified the applicability of certain provisions. Both ASU 2020-04 and ASU 2021-01 are currently effective prospectively for all entities through December 31, 2022, when the reference rate replacement activity is expected to have been completed. The guidance in ASU 2020-04 and ASU 2021-01 is optional and may be elected over time as reference rate reform activities occur. During 2021, the Company elected to apply the optional expedient for hedge accounting specifically to the interest rate cap agreement (the "Cap") executed in July 2021 (see Note 6). This allowed the Company to assume that the index upon which future interest payments on the hedged portion of the Term Loan (see Note 5) will be based matches the index on the Cap. Adoption of this practical expedient had no impact on the Company's condensed consolidated financial statements upon adoption. The Company has not yet adopted any other expedients and will continue to evaluate the impact this standard may have on its consolidated financial statements.

Effective June 30, 2022, the Company adopted FASB ASU 2017-11, Earnings per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features (“ASU 2017-11”). Part I of ASU 2017-11 simplified the accounting for certain financial instruments with down round features, a provision in an equity-linked financial instrument (or embedded feature) that provides a downward adjustment of the current exercise price based on the price of future equity offerings. The Company also adopted FASB ASU 2020-06, Debt - Debt with Conversion and Other Options and Derivatives and Hedging (“ASU 2020-06”). ASU 2020-06 simplified the accounting for convertible debt instruments and convertible preferred stock by reducing the number of accounting models and limiting the number of embedded conversion features separately recognized from the primary contract. As a result of these adoptions, the Company was permitted to exclude the down-round feature of its investment in Aireon LLC (“Aireon”) from the consideration of whether the instrument is indexed to the entity's own stock (see Note 12).

Fair Value Measurements

The Company evaluates assets and liabilities subject to fair value measurements on a recurring and non-recurring basis to determine the appropriate level to classify them for each reporting period. This determination requires significant judgments to be made by management of the Company. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

The fair value hierarchy consists of the following tiers:

•Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

•Level 2, defined as observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

•Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying values of the following financial instruments approximated their fair values as of September 30, 2022 and December 31, 2021: (1) cash and cash equivalents, (2) prepaid expenses and other current assets, (3) accounts receivable, (4) accounts payable, and (5) accrued expenses and other current liabilities. Fair values approximate their carrying values because of their short-term nature. The Level 2 cash equivalents may include money market funds, commercial paper and short-term U.S. agency securities. The Company also classifies its derivative financial instruments as Level 2. The Company did not hold any Level 3 assets as of September 30, 2022 or December 31, 2021.

The fair values of the Company’s Level 2 estimates are based upon certain market assumptions and information available to the Company. In determining fair value, the Company uses a market approach utilizing valuation models that incorporate observable inputs such as interest rates, bond yields and quoted prices for similar assets.

Leases

For new leases, the Company will determine if an arrangement is or contains a lease at inception. Leases are included as (1) right-of-use (“ROU”) assets within other assets, and (2) ROU liabilities within accrued expenses and other liabilities and are included within other long-term liabilities on the Company’s condensed consolidated balance sheets.

ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Certain leases contain variable contractual obligations as a result of future base rate escalations which are estimated based on observed trends and included within the measurement of present value. The Company’s leases do not provide an implicit rate. The Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The ROU assets also include any lease payments made and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For certain leases, such as teleport network facilities, the Company elected the practical expedient to combine lease and non-lease components as a single lease component. Taxes assessed on leases in which the Company is either a lessor or lessee are excluded from contract consideration and variable payments when measuring new lease contracts or remeasuring existing lease contracts.

Inventory

Inventory consists primarily of finished goods and raw materials from third-party manufacturers. The Company outsources manufacturing of subscriber equipment to a third-party manufacturer and purchases accessories from third-party suppliers. The Company’s cost of inventory includes an allocation of overhead, including payroll and payroll-related costs of employees directly involved in bringing inventory to its existing condition, and freight. Inventories are valued using the average cost method and are carried at the lower of cost or net realizable value.

The Company has a manufacturing agreement with Benchmark Electronics Inc. (“Benchmark”) to manufacture most of its subscriber equipment. Pursuant to the agreement, the Company may be required to purchase excess materials at cost plus a contractual markup if the materials are not used in production within the periods specified in the agreement. Benchmark will then repurchase such materials from the Company at the same price paid by the Company, as required for the production of the subscriber equipment.

The following table summarizes the Company's inventory balances:

	September 30, 2022		December 31, 2021
	(In thousands)
Finished goods	$	13,375	$	18,395
Raw materials	26,910		11,850
Inventory valuation reserve	(1,063)		(1,201)
Total	$	39,222	$	29,044

Commitments

Launch and Related Services

In 2022, the Company entered into agreements with Space Exploration Technology Corp. and Thales Alenia Space France for launch and related services, to launch up to five of the Company's ground spare satellites. The Company expects costs related to this launch to total approximately $40.0 million. As of September 30, 2022, the Company had made aggregate payments of $8.2 million related to these services, which were capitalized as construction in progress within property and equipment, net in the accompanying condensed consolidated balance sheets. The Company currently expects the launch to occur in mid-2023.

Derivative Financial Instruments

The Company uses derivatives (interest rate swap, swaption and cap) to manage its exposure to fluctuating interest rate risk on variable rate debt. Its derivatives are measured at fair value and are recorded on the condensed consolidated balance sheets within other current liabilities and other assets. When the Company’s derivatives are designated as cash flow hedges, the effective portion of the changes in fair value of the derivatives are recorded in accumulated other comprehensive income (loss) within the Company’s condensed consolidated balance sheets and subsequently recognized in earnings when the hedged items impact earnings. Any ineffective portion of a derivative's change in fair value will be recognized in earnings in the same period in which the hedged interest payments affect earnings. Within the condensed consolidated statements of operations and comprehensive income, the gains and losses related to cash flow hedges are recognized within interest income (expense), net, as this is the same financial statement line item used for any gains or losses associated with the hedged items. Cash flows from hedging activities are included in operating activities within the Company’s condensed consolidated statements of cash flows, which is the same category as the item being hedged. See Note 6 for further information.

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Cash and Cash Equivalents, Restricted Cash and Marketable Securities

9 Months Ended

Sep. 30, 2022

Cash and Cash Equivalents [Abstract]

Cash and Cash Equivalents, Restricted Cash and Marketable Securities

Cash and Cash Equivalents

Cash and Cash Equivalents

The following table presents the Company’s cash and cash equivalents balances:

	September 30, 2022		December 31, 2021		Recurring Fair Value Measurement
	(In thousands)
Cash and cash equivalents:
Cash	$	18,660	$	28,496
Money market funds	200,102		292,417		Level 2
Total cash and cash equivalents	$	218,762	$	320,913

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Leases

9 Months Ended

Sep. 30, 2022

Leases [Abstract]

Lessor, Operating Leases [Text Block]

Leases

Lessor Arrangements

Operating leases in which the Company is a lessor consist primarily of hosting agreements with Aireon (see Note 12) and L3Harris Technologies, Inc. (“L3Harris”) for space on the Company’s satellites. These agreements provide for a fee that will be recognized over the life of the satellites, currently estimated to be approximately 12.5 years. Lease income related to these agreements was $5.4 million for each of the three months ended September 30, 2022 and 2021, and $16.1 million for each of the nine months ended September 30, 2022 and 2021. Lease income is recorded as hosted payload and other data service revenue within service revenue on the Company’s condensed consolidated statements of operations and comprehensive income.

Aireon has made payments to the Company pursuant to its hosting agreement, and the Company expects Aireon will continue to do so. L3Harris has prepaid all amounts owed to the Company pursuant to its hosting arrangement. The following table presents future income with respect to the Company’s operating leases in which it is the lessor existing at September 30, 2022, exclusive of the $16.1 million recognized during the nine months ended September 30, 2022, by year and in the aggregate:

Year Ending December 31,	Amount
	(In thousands)
2022	$	5,361
2023	21,445
2024	21,445
2025	21,445
2026	21,445
Thereafter	77,462
Total lease income	$	168,603

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Debt

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Debt

Debt

Term Loan and Revolving Facility

In November 2019 and February 2020, pursuant to a loan agreement (as amended to date, the “Credit Agreement”), the Company entered into a term loan totaling $1,650.0 million in aggregate principal amount with Deutsche Bank AG (the “Term Loan”) and an accompanying $100.0 million revolving loan (the “Revolving Facility”). The Term Loan was repriced on multiple occasions and now bears interest at an annual rate of one-month LIBOR plus 2.50%, with a 0.75% LIBOR floor. The maturity date of the Term Loan is in November 2026. The interest rate on the Revolving Facility is LIBOR plus 3.75%, with no LIBOR floor, and the Revolving Facility has a maturity date in November 2024. Principal payments, payable quarterly, equal $16.5 million per annum (one percent of the full principal amount of the Term Loan), with the remaining principal due upon maturity.

As of September 30, 2022 and December 31, 2021, the Company reported an aggregate of $1,608.8 million and $1,621.1 million in borrowings under the Term Loan, respectively. These amounts do not include $19.8 million and $23.1 million of net unamortized deferred financing costs as of September 30, 2022 and December 31, 2021, respectively. The net principal balance in borrowings in the accompanying condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021 amounted to $1,589.0 million and $1,598.0 million, respectively. As of September 30, 2022 and December 31, 2021, based upon over-the-counter bid levels (Level 2 - market approach), the fair value of the borrowings under the Term Loan was $1,568.5 million and $1,622.1 million, respectively. The Company had not borrowed under the Revolving Facility as of September 30, 2022 and December 31, 2021.

The Credit Agreement restricts the Company’s ability to incur liens, engage in mergers or asset sales, pay dividends, repay subordinated indebtedness, incur indebtedness, make investments and loans, and engage in other transactions as specified in the Credit Agreement. The Credit Agreement provides for specified exceptions, including baskets measured as a percentage of trailing twelve months of earnings before interest, taxes, depreciation and amortization (“EBITDA” as defined in the Credit Agreement) and unlimited exceptions based on achievement and maintenance of specified leverage ratios, for, among other things, incurring indebtedness and liens and making investments, restricted payments for dividends and share repurchases, and payments of subordinated indebtedness. The Credit Agreement also contains a mandatory prepayment sweep mechanism with respect to a portion of the Company’s excess cash flow (as defined in the Credit Agreement), which is phased out based on achievement and maintenance of specified leverage ratios. As of December 31, 2021, the Company was below the specified leverage ratio, and a mandatory prepayment sweep was therefore not required with respect to 2021 cash flows.

The Credit Agreement contains no financial maintenance covenants with respect to the Term Loan. With respect to the Revolving Facility, the Credit Agreement requires the Company to maintain a consolidated first lien net leverage ratio (as defined in the Credit Agreement) of no greater than 6.25 to 1 if more than 35% of the Revolving Facility has been drawn. The Credit Agreement contains other customary representations and warranties, affirmative and negative covenants, and events of default. The Company was in compliance with all covenants as of September 30, 2022.

Interest on Debt

Total interest incurred includes amortization of deferred financing fees and capitalized interest. The following table presents the interest and amortization of deferred financing fees related to the Term Loan:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Total interest incurred	$	19,844	$	18,462	$	51,076	$	61,018
Amortization of deferred financing fees	$	1,211	$	1,148	$	3,593	$	3,115
Capitalized interest	$	725	$	438	$	1,589	$	1,795

As of September 30, 2022 and December 31, 2021, accrued interest on the Term Loan was $0.2 million and $0.1 million, respectively.

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Derivatives

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Derivative Financial Instruments

The Company is exposed to interest rate fluctuations related to its Term Loan. The Company has reduced its exposure to fluctuations in the cash flows associated with changes in the variable interest rate by entering into offsetting positions through the use of interest rate cap and swap contracts which result in recognizing a maximum fixed interest rate for a portion of the Term Loan. These instruments reduce the negative impact of increases in the variable rate over the term of the derivative contracts. These contracts are not used for trading or other speculative purposes. Historically, the Company has not incurred, and does not expect to incur in the future, any losses as a result of counterparty default.

Hedge effectiveness of interest rate swap and cap contracts is based on a long-haul hypothetical derivative methodology and includes all changes in value. The Company formally assesses, both at the hedge’s inception and on an ongoing quarterly basis,

whether the designated derivative instruments are highly effective in offsetting changes in the cash flows of the hedged items. When the hedging instrument is sold, expires, is terminated, is exercised, no longer qualifies for hedge accounting, is de-designated, or is no longer probable, hedge accounting is discontinued prospectively.

Interest Rate Swap and Swaption

The Company previously entered into a long-term interest rate swap (“Swap”) to mitigate variability in forecasted interest payments on a portion of the Company’s borrowings under the Term Loan. The Swap expired in November 2021. Under the Swap, on the last business day of each month, the Company received variable interest payments based on one-month LIBOR from the counterparty. The Company paid a fixed rate of 1.565% per annum on the Swap.

The Company also entered into an interest rate swaption agreement (“Swaption”), for which the Company paid a fixed annual rate of 0.50%. At inception, the Swap and Swaption were designated as cash flow hedges for hedge accounting. The unrealized changes in market value were recorded in accumulated other comprehensive income (loss) and any remaining balance will be reclassified into earnings during the period in which the hedged transaction affects earnings. Due to the changes made to the Term Loan as a result of the July 2021 repricing, at that time the Company elected to de-designate the Swap as a cash flow hedge. Accordingly, as the related interest payments were still probable, the accumulated balance within other comprehensive income (loss) as of the de-designation date was amortized into earnings through the November 2021 expiration date.

The Company sold the Swaption in May 2021 for $0.7 million. The Company continued to pay the fixed annual rate for the Swaption through the term of the Swaption, which expired in November 2021.

Interest Rate Cap

In July 2021, the Company entered into the Cap that began in December 2021, following the expiration of the Swap. The Company entered into the Cap in order to manage its exposure to interest rate movements on a portion of the Term Loan through the maturity of the Term Loan in November 2026. The Cap provides the Company with the right to receive payment if one-month LIBOR exceeds 1.5%. As of December 2021, the Company began paying a fixed monthly premium based on an annual rate of 0.31% for the Cap. The Cap carried a notional amount of $1,000.0 million as of September 30, 2022 and December 31, 2021.

The Cap is designed to mirror the terms of the Term Loan and to offset the cash flows being hedged. The Company designated the Cap as a cash flow hedge of the variability of the LIBOR-based interest payments on the Term Loan. The effective portion of the Cap's change in fair value will be recorded in accumulated other comprehensive income (loss). Any ineffective portion of the Cap's change in fair value will be recorded in current earnings as interest expense.

Fair Value of Derivative Instruments

As of September 30, 2022 and December 31, 2021, the Company had an asset balance of $99.9 million and $19.7 million, respectively, for the fair value of the Cap and a liability balance of $11.7 million and $14.8 million, respectively, for the fair value of the Cap premium. Both the Cap and the Cap premium are recorded net within other assets.

During the three and nine months ended September 30, 2022, the Company collectively incurred $0.8 million and $2.5 million, respectively, in interest expense for the Swaption and Cap. This interest expense was reduced by $1.8 million for both the three and nine months ended September 30, 2022, for payments received related to the Cap. During the three and nine months ended September 30, 2021, the Company collectively incurred $1.8 million and $6.6 million, respectively, in net interest expense for the Swap and Swaption.

Gains and losses resulting from fair value adjustments to the Cap are recorded within accumulated other comprehensive income (loss) within the Company’s condensed consolidated balance sheets and reclassified to interest expense on the dates that interest payments become due. Cash flows related to the derivative contracts are included in cash flows from operating activities on the condensed consolidated statements of cash flows. Over the next 12 months, the Company expects any gains or losses for cash flow hedges amortized from accumulated other comprehensive income (loss) into earnings to have an immaterial impact on the Company’s consolidated financial statements.

The following table presents the amount of unrealized gain or loss and related tax impact associated with the derivative instruments that the Company recorded in its condensed consolidated statements of operations and comprehensive income:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Unrealized gain, net of tax	$	25,537	$	3,040	$	63,971	$	7,122
Tax expense	$	7,740	$	1,010	$	19,392	$	2,222

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Stock-Based Compensation

9 Months Ended

Sep. 30, 2022

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock-Based Compensation

In May 2019, the Company’s stockholders approved the amendment and restatement of the Company’s 2015 Equity Incentive Plan (as so amended and restated, the “Amended 2015 Plan”). As of September 30, 2022, the remaining aggregate number of shares of the Company’s common stock available for future grants under the Amended 2015 Plan was 8,009,551. The Amended 2015 Plan provides for the grant of stock-based awards, including nonqualified stock options, incentive stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights and other equity securities to employees, consultants and non-employee directors of the Company and its affiliated entities. The number of shares of common stock available for issuance under the Amended 2015 Plan is reduced by (i) one share for each share of common stock issued pursuant to an appreciation award, such as a stock option or stock appreciation right with an exercise or strike price of at least 100% of the fair market value of the underlying common stock on the date of grant, and (ii) 1.8 shares for each share of common stock issued pursuant to any stock award that is not an appreciation award, also known as a “full value award.” The Amended 2015 Plan allows the Company to utilize a broad array of equity incentives and performance cash incentives in order to secure and retain the services of its employees, directors and consultants, and to provide long-term incentives that align the interests of its employees, directors and consultants with the interests of the Company’s stockholders. The Company accounts for stock-based compensation at fair value.

Stock Option Awards

The stock option awards granted to employees generally (i) have a term of ten years, (ii) vest over four years with 25% vesting after the first year of service and the remainder vesting ratably on a quarterly basis thereafter, (iii) are contingent upon employment on the vesting date, and (iv) have an exercise price equal to the fair market value of the underlying shares at the date of grant. The fair value of stock options is determined at the grant date using the Black-Scholes option pricing model.

The Company historically granted stock options to newly hired and promoted employees but now exclusively utilizes RSUs. The Company did not grant any stock options during the three and nine months ended September 30, 2022 or 2021.

Option Summary

A summary of the activity of the Company's stock options is as follows:

	Shares	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
	(In thousands, except years and per share data)
Options outstanding at December 31, 2021	1,681	$	9.35	3.28	$	53,698
Exercised	(314)	7.78			$	11,244
Forfeited	(2)	14.24
Options outstanding at September 30, 2022	1,365	$	9.70	2.81	$	47,312
Options exercisable at September 30, 2022	1,345	$	9.52	2.76	$	46,855
Options exercisable and expected to vest at September 30, 2022	1,365	$	9.70	2.81	$	47,310

	Shares	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
	(In thousands, except years and per share data)
Options outstanding at December 31, 2020	2,554	$	9.10	3.94	$	77,182
Cancelled or expired	(1)	7.78
Exercised	(844)	8.46			$	31,171
Forfeited	(11)	15.45
Options outstanding at September 30, 2021	1,698	$	9.38	3.54	$	51,755
Options exercisable at September 30, 2021	1,592	$	8.73	3.31	$	49,552
Options exercisable and expected to vest at September 30, 2021	1,698	$	9.37	3.54	$	51,732

Restricted Stock Units

The RSUs granted to employees for service generally vest over four years, with 25% vesting on the first anniversary of the grant date and the remainder vesting ratably on a quarterly basis thereafter, subject to continued employment. Some RSUs granted to employees for performance vest upon the completion of defined performance goals, subject to continued

employment. The RSUs granted to non-employee members of the board of directors generally vest in full on the first anniversary of the grant date. The RSUs granted to non-employee consultants generally vest 50% on the first anniversary of the grant date, with the remaining 50% vesting quarterly thereafter through the second anniversary of the grant date. The Company’s RSUs are classified as equity awards because the RSUs will be settled in the Company’s common stock upon vesting. The fair value of the RSUs is determined at the grant date based on the closing price of the Company's common stock on the date of grant. The related compensation expense is recognized over the service period, or shorter periods based on the retirement eligibility of certain grantees, and is based on the grant date fair value of the Company’s common stock and the number of shares expected to vest. The fair value of the awards is not remeasured at the end of each reporting period. The RSUs do not carry voting rights until they are vested, and shares are issued upon settlement in accordance with the terms of the award.

RSU Summary

The following tables summarize the Company’s RSU activity:

	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2021	2,550	$	25.80
Granted	1,491	40.02
Forfeited	(127)	31.85
Released	(766)	32.73
Outstanding at September 30, 2022	3,148	$	30.60
Vested and unreleased at September 30, 2022 (1)	885

	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2020	2,664	$	18.96
Granted	843	41.67
Forfeited	(90)	28.41
Released	(782)	21.22
Outstanding at September 30, 2021	2,635	$	25.23
Vested and unreleased at September 30, 2021 (1)	860

(1)     These RSUs were granted to the Company's board of directors as a part of their compensation for board and committee service, as detailed below, and had vested but had not yet settled, meaning that the underlying shares of common stock had not been issued and released pursuant to the terms of the applicable compensation program.

Service-Based RSUs

The majority of the annual compensation the Company provides to non-employee members of its board of directors is paid in the form of RSUs. In addition, some members of the Company’s board of directors may elect to receive the remainder of their annual compensation, or a portion thereof, in the form of RSUs. An aggregate amount of approximately 57,000 and 39,000 service-based RSUs were granted to the Company’s non-employee members of the board of directors as a result of these payments and elections during the nine months ended September 30, 2022 and 2021, respectively, with an estimated grant date fair value of $2.2 million and $1.6 million, respectively.

During the nine months ended September 30, 2022 and 2021, the Company granted approximately 1,012,000 and 461,000 service-based RSUs, respectively, to its employees, with an estimated aggregate grant date fair value of $41.0 million and $19.2 million, respectively.

During the nine months ended September 30, 2022 and 2021, the Company granted approximately 7,000 and 2,000 service-based RSUs, respectively, to non-employee consultants, with an estimated aggregate grant date fair value of $0.3 million and $0.1 million, respectively.

Performance-Based RSUs

In March 2022 and 2021, the Company granted approximately 248,000 and 228,000 annual incentive, performance-based RSUs, respectively, to the Company’s executives and employees (the “Bonus RSUs”), with an estimated grant date fair value of $9.7 million and $9.5 million, respectively. Vesting of the Bonus RSUs is and was dependent upon the Company’s achievement of defined performance goals over the respective fiscal year. The Company records stock-based compensation expense related to performance-based RSUs when it is considered probable that the performance conditions will be met. Management believes it is probable that substantially all of the 2022 Bonus RSUs will vest. The level of achievement, if any, of performance goals will be determined by the compensation committee of the Company’s board of directors and, if such goals are achieved, the 2022 Bonus RSUs will vest, subject to continued employment, in March 2023. All of the 2021 Bonus RSUs vested in March 2022 upon the determination of the level of achievement of the performance goals.

Additionally, in March 2022 and 2021, the Company granted approximately 167,000 and 110,000 long-term, performance-based RSUs, respectively, to the Company’s executives (the “Executive RSUs”). The estimated aggregate grant date fair value of the Executive RSUs for the 2022 and 2021 grants was $6.5 million and $4.6 million, respectively. Vesting of the Executive RSUs is dependent upon the Company’s achievement of defined performance goals over a two-year period. The vesting of Executive RSUs will ultimately range from 0% to 150% of the number of shares underlying the Executive RSUs granted based on the level of achievement of the performance goals. If the Company achieves the performance goals, 50% of the number of Executive RSUs earned based on performance will vest on the second anniversary of the grant date, and the remaining 50% will vest on the third anniversary of the grant date, in each case subject to the executive’s continued service as of the vesting date, which may be accelerated based on the retirement eligibility of certain grantees. During March 2022, approximately 50,000 shares underlying performance-based RSUs granted to the Company’s executives in 2020 were forfeited as a result of performance metrics not being fully achieved. During March 2021, the Company awarded approximately 3,000 additional shares related to performance-based RSUs granted in 2019 to the Company's executives for over-achievement of performance targets.

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Equity Transactions

9 Months Ended

Sep. 30, 2022

Stockholders' Equity Note [Abstract]

Equity Transactions

Equity Transactions

Preferred Stock

The Company is authorized to issue 2.0 million shares of preferred stock with a par value of $0.0001 per share. The Company previously issued 1.5 million shares of preferred stock, all of which have converted to common stock. The remaining 0.5 million authorized shares of preferred stock remain undesignated and unissued as of September 30, 2022 and December 31, 2021. As of September 30, 2022 and December 31, 2021, there were no outstanding shares of preferred stock.

Share Repurchases and Retirement

In February 2021, the Company implemented a stock repurchase program for up to $300.0 million of its common stock through December 31, 2022. In March 2022, the Company expanded the repurchase program to include up to an additional $300.0 million of its common stock through December 31, 2023. This timeframe can be extended or shortened by the board of directors. Repurchases may be made from time to time on the open market at prevailing prices or in negotiated transactions off the market. All shares are immediately retired upon repurchase in accordance with the board-approved policy. When treasury shares are retired, the Company’s policy is to allocate the excess of the repurchase price over the par value of shares acquired first, to additional paid-in capital, and then to retained earnings. The portion to be allocated to additional paid-in capital is calculated by applying a percentage, determined by dividing the number of shares to be retired by the number of shares outstanding, to the balance of additional paid-in capital as of the date of retirement.

The Company repurchased and subsequently retired 1.8 million and 6.5 million shares of its common stock during the three and nine months ended September 30, 2022, respectively, for a total purchase price of $76.5 million and $245.7 million, respectively. In addition, in September 2022, the Company repurchased 0.1 million shares for approximately $3.7 million, which were not settled and retired until October 2022. As such, these shares are recorded as treasury stock as of September 30, 2022. The Company repurchased and subsequently retired 0.1 million and 3.4 million shares of its common stock during the three and nine months ended September 30, 2021, respectively, for a total purchase price of $2.6 million and $125.1 million, respectively. As of September 30, 2022, $187.2 million remained available and authorized for repurchase under the stock repurchase program approved in March 2022.

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Revenue

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

The following table summarizes the Company’s services revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Commercial services revenue:
Voice and data	$	50,256	$	45,737	$	143,621	$	130,444
IoT data	33,786		30,040		92,857		82,018
Broadband	13,589		11,461		37,200		31,531
Hosted payload and other data	14,846		14,649		44,769		43,867
Total commercial services revenue	112,477		101,887		318,447		287,860
Government services revenue	26,500		25,887		79,500		77,387
Total services revenue	$	138,977	$	127,774	$	397,947	$	365,247

The following table summarizes the Company’s engineering and support services revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Commercial	$	1,783	$	1,249	$	4,280	$	2,978
Government	15,341		6,238		29,509		17,781
Total engineering and support services revenue	$	17,124	$	7,487	$	33,789	$	20,759

Approximately 30% and 34% of the Company's accounts receivable balance at September 30, 2022 and December 31, 2021, respectively, was due from prime contracts or subcontracts with agencies of the U.S. government.

The Company's contracts with customers generally do not contain performance obligations with terms in excess of one year. As such, the Company does not disclose details related to the value of performance obligations that are unsatisfied as of the end of the reporting period. The total value of any performance obligations that extend beyond one year is immaterial to the financial statements.

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and deferred revenue (contract liabilities) on the condensed consolidated balance sheets. The Company bills amounts under its agreed-upon contractual terms at periodic intervals (for services), upon shipment (for equipment), or upon achievement of contractual milestones or as work progresses (for engineering and support services). Billing may occur subsequent to revenue recognition, resulting in unbilled accounts receivable (contract assets). The Company may also receive payments from customers before revenue is recognized, resulting in deferred revenue (contract liabilities). The Company recognized revenue that was previously recorded as deferred revenue in the amounts of $5.5 million and $10.6 million for the three months ended September 30, 2022 and 2021, respectively, and $21.1 million and $32.4 million during the nine months ended September 30, 2022 and 2021. The Company has also recorded costs of obtaining contracts expected to be recovered in prepaid expenses and other current assets (contract assets or commissions), that are not separately disclosed on the condensed consolidated balance sheets. The commissions are recognized over the estimated usage period. The following table presents contract assets not separately disclosed:

	September 30, 2022		December 31, 2021
	(In thousands)
Contract Assets:
Commissions	$	1,471	$	1,190
Other contract costs	$	2,330	$	2,558
Unbilled receivables	$	14,693	$	10,752

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Income Taxes

9 Months Ended

Sep. 30, 2022

Income Tax Disclosure [Abstract]

Income Tax Disclosure

Income TaxesIncome before income taxes was $0.1 million and $10.5 million for the three and nine months ended September 30, 2022, respectively, while the income tax benefit was $2.1 million for the three months ended September 30, 2022 and the income tax expense was $1.0 million for the nine months ended September 30, 2022. The effective tax rate for the three and nine months ended September 30, 2022, differed from the federal statutory rate of 21% primarily due to U.S. tax credits, a discrete tax benefit associated with stock compensation and a discrete tax benefit from the U.S. provision-to-return adjustment in the

current period, partially offset by tax expense associated with nondeductible executive compensation and non-creditable foreign taxes.

Loss before income taxes was $3.5 million and $23.5 million for the three and nine months ended September 30, 2021, respectively, while the income tax benefit was $1.5 million and $20.0 million for the three and nine months ended September 30, 2021, respectively. The effective tax rate for the three-month period ended September 30, 2021, differed from the federal statutory rate of 21% primarily due to the net impact of a discrete tax benefit associated with the stock compensation tax deduction and the decrease to the prior year valuation allowance for state net operating losses, offset by a discrete state tax expense associated with state apportionment changes. The effective tax rate for the nine-month period ended September 30, 2021, differed from the federal statutory rate of 21% primarily due to the net impact of the discrete state tax benefit associated with state apportionment changes, a stock compensation tax deduction and the Company's U.S. tax credits.

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Net Income (Loss) Per Share

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Net Income (Loss) Per Share

Net Income (Loss) Per Share

The Company calculates basic net income (loss) per share by dividing net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. In periods of net income, diluted net income per share takes into account the effect of potential dilutive common shares when the effect is dilutive. Potentially dilutive common shares include (i) shares of common stock issuable upon exercise of outstanding stock options and (ii) contingently issuable RSUs that are convertible into shares of common stock upon achievement of certain service and performance requirements. The effect of potentially dilutive common shares is computed using the treasury stock method. The RSUs granted to members of the Company’s board of directors contain non-forfeitable rights to dividends and therefore are considered to be participating securities in periods of net income. The income attributable to the RSUs was immaterial for the periods presented, and as a result, the calculation of basic and diluted net income per share excludes net income attributable to the unvested RSUs granted to the Company’s board of directors from the numerator and excludes the impact of the unvested RSUs granted to the Company’s board of directors from the denominator.

The following table summarizes the computations of basic and diluted net income (loss) per share:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands, except per share data)
Numerator:
Net income (loss) - basic and diluted	$	2,149	$	(2,085)	9,530		(3,435)
Denominator:
Weighted average common shares - basic	127,697		132,869		128,800		133,763
Dilutive effect of stock options	921		—		974		—
Dilutive effect of RSUs	457		—		510		—
Weighted average common shares - diluted	129,075		132,869		130,284		133,763
Net income (loss) per share - basic and diluted	$	0.02	$	(0.02)	$	0.07	$	(0.03)

Due to the Company’s net loss position for the three and nine months ended September 30, 2021, all potential common stock equivalents were anti-dilutive and therefore excluded from the calculation of diluted net loss per share. The following table presents the incremental number of shares underlying stock options and RSUs outstanding with anti-dilutive effects:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
	(In thousands)		(In thousands)
Performance-based RSUs	—	49	—	101
Service-based RSUs	—	404	—	547
Stock options	—	1,130	—	1,236

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Related Party Transactions

9 Months Ended

Sep. 30, 2021

Related Party Transactions [Abstract]

Related Party Transactions Disclosure

Related Party Transactions

Aireon LLC and Aireon Holdings LLC

The Company's satellite constellation hosts the Aireon® system, which provides a global air traffic surveillance service through a series of automatic dependent surveillance-broadcast (“ADS-B”) receivers. The Company formed Aireon in 2011, with subsequent investments from the air navigation service providers (“ANSPs”) of Canada, Italy, Denmark, Ireland and the United Kingdom, to develop and market this service. The Company and other Aireon investors hold their interests in Aireon through the Amended and Restated Aireon Holdings LLC agreement (the “Aireon Holdings LLC Agreement”). Aireon Holdings LLC holds 100% of the membership interests in Aireon, which is the operating entity.

In June 2022, the Company entered into a subscription agreement with Aireon and invested $50 million in exchange for a 6% preferred interest. The Company's investment in Aireon is accounted for as an equity method investment. The carrying value of the Company's investment in Aireon was $50 million as of September 30, 2022. The original investments by the Company were previously written down to a carrying value of zero.

As of September 30, 2022 and December 31, 2021, the Company's fully diluted ownership stake in Aireon Holdings was approximately 39.5% and 35.7%, respectively, and is subject to redemption provisions contained in the Aireon Holdings LLC Agreement.

Aireon has contracted to pay the Company a fee to host the ADS-B receivers on its constellation, as well as fees for power and data services in connection with the delivery of the air traffic surveillance data. Pursuant to an agreement with Aireon (the “Hosting Agreement”), Aireon will pay the Company fees of $200.0 million to host the ADS-B receivers, of which $70.5 million had been paid as of September 30, 2022, as well as power fees of up to approximately $3.7 million per year. Aireon also pays data services fees of $19.8 million per year for the delivery of the air traffic surveillance data under a data transmission services agreement. Pursuant to ASU 2016-02, the Company considers the Hosting Agreement an operating lease. The Company recognized $4.0 million of hosting fee revenue for each of the three months ended September 30, 2022 and 2021 and $12.0 million for each of the nine months ended September 30, 2022 and 2021. Aireon receivables under the Hosting Agreement totaled $3.6 million as of September 30, 2022. There were no such receivables as of December 31, 2021. The Company recorded power and data service revenue from Aireon of $5.9 million for each of the three months ended September 30, 2022 and 2021 and $17.6 million for each of the nine months ended September 30, 2022 and 2021.

Under two services agreements, the Company also provides Aireon with administrative services and support services, the fees for which are paid monthly. Aireon receivables due to the Company under these two agreements totaled $2.1 million and $2.2 million as of September 30, 2022 and December 31, 2021, respectively.

The Company and the other Aireon investors have agreed to participate pro-rata, based on their fully diluted ownership stakes, in funding an investor bridge loan to Aireon. The Company’s maximum funding commitment for the bridge loan is $10.7 million. No bridge loan amounts were outstanding as of September 30, 2022 or December 31, 2021.

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Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

New Accounting Pronouncements, Policy [Policy Text Block]

Adopted and Recently Issued Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). The guidance provides optional expedients and exceptions for contracts, hedging relationships, and other transactions that reference London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued. ASU 2020-04 was further amended in January 2021 when the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”), which clarified the applicability of certain provisions. Both ASU 2020-04 and ASU 2021-01 are currently effective prospectively for all entities through December 31, 2022, when the reference rate replacement activity is expected to have been completed. The guidance in ASU 2020-04 and ASU 2021-01 is optional and may be elected over time as reference rate reform activities occur. During 2021, the Company elected to apply the optional expedient for hedge accounting specifically to the interest rate cap agreement (the "Cap") executed in July 2021 (see Note 6). This allowed the Company to assume that the index upon which future interest payments on the hedged portion of the Term Loan (see Note 5) will be based matches the index on the Cap. Adoption of this practical expedient had no impact on the Company's condensed consolidated financial statements upon adoption. The Company has not yet adopted any other expedients and will continue to evaluate the impact this standard may have on its consolidated financial statements.

Effective June 30, 2022, the Company adopted FASB ASU 2017-11, Earnings per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features (“ASU 2017-11”). Part I of ASU 2017-11 simplified the accounting for certain financial instruments with down round features, a provision in an equity-linked financial instrument (or embedded feature) that provides a downward adjustment of the current exercise price based on the price of future equity offerings. The Company also adopted FASB ASU 2020-06, Debt - Debt with Conversion and Other Options and Derivatives and Hedging (“ASU 2020-06”). ASU 2020-06 simplified the accounting for convertible debt instruments and convertible preferred stock by reducing the number of accounting models and limiting the number of embedded conversion features separately recognized from the primary contract. As a result of these adoptions, the Company was permitted to exclude the down-round feature of its investment in Aireon LLC (“Aireon”) from the consideration of whether the instrument is indexed to the entity's own stock (see Note 12).

Fair Value Measurement, Policy [Policy Text Block]

Fair Value Measurements

The Company evaluates assets and liabilities subject to fair value measurements on a recurring and non-recurring basis to determine the appropriate level to classify them for each reporting period. This determination requires significant judgments to be made by management of the Company. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

The fair value hierarchy consists of the following tiers:

•Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

•Level 2, defined as observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

•Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying values of the following financial instruments approximated their fair values as of September 30, 2022 and December 31, 2021: (1) cash and cash equivalents, (2) prepaid expenses and other current assets, (3) accounts receivable, (4) accounts payable, and (5) accrued expenses and other current liabilities. Fair values approximate their carrying values because of their short-term nature. The Level 2 cash equivalents may include money market funds, commercial paper and short-term U.S. agency securities. The Company also classifies its derivative financial instruments as Level 2. The Company did not hold any Level 3 assets as of September 30, 2022 or December 31, 2021.

The fair values of the Company’s Level 2 estimates are based upon certain market assumptions and information available to the Company. In determining fair value, the Company uses a market approach utilizing valuation models that incorporate observable inputs such as interest rates, bond yields and quoted prices for similar assets.

Lessee, Leases [Policy Text Block]

Leases

For new leases, the Company will determine if an arrangement is or contains a lease at inception. Leases are included as (1) right-of-use (“ROU”) assets within other assets, and (2) ROU liabilities within accrued expenses and other liabilities and are included within other long-term liabilities on the Company’s condensed consolidated balance sheets.

ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Certain leases contain variable contractual obligations as a result of future base rate escalations which are estimated based on observed trends and included within the measurement of present value. The Company’s leases do not provide an implicit rate. The Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The ROU assets also include any lease payments made and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For certain leases, such as teleport network facilities, the Company elected the practical expedient to combine lease and non-lease components as a single lease component. Taxes assessed on leases in which the Company is either a lessor or lessee are excluded from contract consideration and variable payments when measuring new lease contracts or remeasuring existing lease contracts.

Inventory, Policy [Policy Text Block]

Inventory

Inventory consists primarily of finished goods and raw materials from third-party manufacturers. The Company outsources manufacturing of subscriber equipment to a third-party manufacturer and purchases accessories from third-party suppliers. The Company’s cost of inventory includes an allocation of overhead, including payroll and payroll-related costs of employees directly involved in bringing inventory to its existing condition, and freight. Inventories are valued using the average cost method and are carried at the lower of cost or net realizable value.

The Company has a manufacturing agreement with Benchmark Electronics Inc. (“Benchmark”) to manufacture most of its subscriber equipment. Pursuant to the agreement, the Company may be required to purchase excess materials at cost plus a contractual markup if the materials are not used in production within the periods specified in the agreement. Benchmark will then repurchase such materials from the Company at the same price paid by the Company, as required for the production of the subscriber equipment.

Commitments and Contingencies, Policy

Commitments

Launch and Related Services

In 2022, the Company entered into agreements with Space Exploration Technology Corp. and Thales Alenia Space France for launch and related services, to launch up to five of the Company's ground spare satellites. The Company expects costs related to this launch to total approximately $40.0 million. As of September 30, 2022, the Company had made aggregate payments of $8.2 million related to these services, which were capitalized as construction in progress within property and equipment, net in the accompanying condensed consolidated balance sheets. The Company currently expects the launch to occur in mid-2023.

Derivatives, Policy [Policy Text Block]

Derivative Financial Instruments

The Company uses derivatives (interest rate swap, swaption and cap) to manage its exposure to fluctuating interest rate risk on variable rate debt. Its derivatives are measured at fair value and are recorded on the condensed consolidated balance sheets within other current liabilities and other assets. When the Company’s derivatives are designated as cash flow hedges, the effective portion of the changes in fair value of the derivatives are recorded in accumulated other comprehensive income (loss) within the Company’s condensed consolidated balance sheets and subsequently recognized in earnings when the hedged items impact earnings. Any ineffective portion of a derivative's change in fair value will be recognized in earnings in the same period in which the hedged interest payments affect earnings. Within the condensed consolidated statements of operations and comprehensive income, the gains and losses related to cash flow hedges are recognized within interest income (expense), net, as this is the same financial statement line item used for any gains or losses associated with the hedged items. Cash flows from hedging activities are included in operating activities within the Company’s condensed consolidated statements of cash flows, which is the same category as the item being hedged. See Note 6 for further information.

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Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

Schedule of Inventory, Current

The following table summarizes the Company's inventory balances:

	September 30, 2022		December 31, 2021
	(In thousands)
Finished goods	$	13,375	$	18,395
Raw materials	26,910		11,850
Inventory valuation reserve	(1,063)		(1,201)
Total	$	39,222	$	29,044

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Cash and Cash Equivalents, Restricted Cash and Marketable Securities (Tables)

9 Months Ended

Sep. 30, 2022

Cash and Cash Equivalents [Abstract]

Summary of Company's Cash and Cash Equivalents

The following table presents the Company’s cash and cash equivalents balances:

	September 30, 2022		December 31, 2021		Recurring Fair Value Measurement
	(In thousands)
Cash and cash equivalents:
Cash	$	18,660	$	28,496
Money market funds	200,102		292,417		Level 2
Total cash and cash equivalents	$	218,762	$	320,913

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Leases (Tables)

9 Months Ended

Sep. 30, 2022

Leases [Abstract]

Operating Lease, Lease Income [Table Text Block]

The following table presents future income with respect to the Company’s operating leases in which it is the lessor existing at September 30, 2022, exclusive of the $16.1 million recognized during the nine months ended September 30, 2022, by year and in the aggregate:

Year Ending December 31,	Amount
	(In thousands)
2022	$	5,361
2023	21,445
2024	21,445
2025	21,445
2026	21,445
Thereafter	77,462
Total lease income	$	168,603

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Debt (Tables)

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Interest incurred

The following table presents the interest and amortization of deferred financing fees related to the Term Loan:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Total interest incurred	$	19,844	$	18,462	$	51,076	$	61,018
Amortization of deferred financing fees	$	1,211	$	1,148	$	3,593	$	3,115
Capitalized interest	$	725	$	438	$	1,589	$	1,795

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Derivative Instruments and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments, Gain (Loss)

The following table presents the amount of unrealized gain or loss and related tax impact associated with the derivative instruments that the Company recorded in its condensed consolidated statements of operations and comprehensive income:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Unrealized gain, net of tax	$	25,537	$	3,040	$	63,971	$	7,122
Tax expense	$	7,740	$	1,010	$	19,392	$	2,222

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Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2022

Sep. 30, 2021

Share-Based Payment Arrangement [Abstract]

Share-based Payment Arrangement, Option, Activity

Option Summary

A summary of the activity of the Company's stock options is as follows:

	Shares	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
	(In thousands, except years and per share data)
Options outstanding at December 31, 2021	1,681	$	9.35	3.28	$	53,698
Exercised	(314)	7.78			$	11,244
Forfeited	(2)	14.24
Options outstanding at September 30, 2022	1,365	$	9.70	2.81	$	47,312
Options exercisable at September 30, 2022	1,345	$	9.52	2.76	$	46,855
Options exercisable and expected to vest at September 30, 2022	1,365	$	9.70	2.81	$	47,310

	Shares	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
	(In thousands, except years and per share data)
Options outstanding at December 31, 2020	2,554	$	9.10	3.94	$	77,182
Cancelled or expired	(1)	7.78
Exercised	(844)	8.46			$	31,171
Forfeited	(11)	15.45
Options outstanding at September 30, 2021	1,698	$	9.38	3.54	$	51,755
Options exercisable at September 30, 2021	1,592	$	8.73	3.31	$	49,552
Options exercisable and expected to vest at September 30, 2021	1,698	$	9.37	3.54	$	51,732

Share-based Payment Arrangement, Restricted Stock and Restricted Stock Unit, Activity

The following tables summarize the Company’s RSU activity:

	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2021	2,550	$	25.80
Granted	1,491	40.02
Forfeited	(127)	31.85
Released	(766)	32.73
Outstanding at September 30, 2022	3,148	$	30.60
Vested and unreleased at September 30, 2022 (1)	885

	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2020	2,664	$	18.96
Granted	843	41.67
Forfeited	(90)	28.41
Released	(782)	21.22
Outstanding at September 30, 2021	2,635	$	25.23
Vested and unreleased at September 30, 2021 (1)	860

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Revenue (Tables)

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Summary of Company's service revenue

The following table summarizes the Company’s services revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Commercial services revenue:
Voice and data	$	50,256	$	45,737	$	143,621	$	130,444
IoT data	33,786		30,040		92,857		82,018
Broadband	13,589		11,461		37,200		31,531
Hosted payload and other data	14,846		14,649		44,769		43,867
Total commercial services revenue	112,477		101,887		318,447		287,860
Government services revenue	26,500		25,887		79,500		77,387
Total services revenue	$	138,977	$	127,774	$	397,947	$	365,247

Summary of Company's Engineering and Support Services Revenue [Table Text Block]

The following table summarizes the Company’s engineering and support services revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands)				(In thousands)
Commercial	$	1,783	$	1,249	$	4,280	$	2,978
Government	15,341		6,238		29,509		17,781
Total engineering and support services revenue	$	17,124	$	7,487	$	33,789	$	20,759

Schedule of recognized contract costs

The following table presents contract assets not separately disclosed:

	September 30, 2022		December 31, 2021
	(In thousands)
Contract Assets:
Commissions	$	1,471	$	1,190
Other contract costs	$	2,330	$	2,558
Unbilled receivables	$	14,693	$	10,752

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Net Income (Loss) Per Share (Tables)

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Computations of Basic and Diluted Net Income Per Share

The following table summarizes the computations of basic and diluted net income (loss) per share:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In thousands, except per share data)
Numerator:
Net income (loss) - basic and diluted	$	2,149	$	(2,085)	9,530		(3,435)
Denominator:
Weighted average common shares - basic	127,697		132,869		128,800		133,763
Dilutive effect of stock options	921		—		974		—
Dilutive effect of RSUs	457		—		510		—
Weighted average common shares - diluted	129,075		132,869		130,284		133,763
Net income (loss) per share - basic and diluted	$	0.02	$	(0.02)	$	0.07	$	(0.03)

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]

The following table presents the incremental number of shares underlying stock options and RSUs outstanding with anti-dilutive effects:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
	(In thousands)		(In thousands)
Performance-based RSUs	—	49	—	101
Service-based RSUs	—	404	—	547
Stock options	—	1,130	—	1,236

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Significant Accounting Policies - Schedule of Inventory (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Finished goods	$ 13,375	$ 18,395
Raw materials	26,910	11,850
Inventory valuation reserve	(1,063)	(1,201)
Inventory	$ 39,222	$ 29,044

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Significant Accounting Policies (Details) $ in Millions	9 Months Ended
	Sep. 30, 2022 USD ($)
Accounting Policies [Abstract]
Launch Service Costs	$ 40

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Cash and Cash Equivalents, Restricted Cash and Marketable Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Cash and cash equivalents:
Total cash and cash equivalents	$ 218,762	$ 320,913
Cash
Cash and cash equivalents:
Cash	18,660	28,496
Money Market Funds | Fair Value, Inputs, Level 2 [Member]
Cash and cash equivalents:
Money market funds	$ 200,102	$ 292,417

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Leases (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Lessor, Lease, Description [Line Items]
Operating Lease, Lease Income	$ 5,400	$ 5,400	$ 16,100	$ 16,100
2022 (Remainder of Fiscal Year)	5,361		5,361
2023	21,445		21,445
2024	21,445		21,445
2025	21,445		21,445
2026	21,445		21,445
Thereafter	77,462		77,462
Total lease income	$ 168,603		$ 168,603
Next Generation Satellites
Lessor, Lease, Description [Line Items]
Property, Plant and Equipment, Useful Life			12 years 6 months

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Debt - Narrative (Details) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2022 USD ($) Rate	Sep. 30, 2022 USD ($) Rate	Dec. 31, 2021 USD ($)	Feb. 07, 2020 USD ($)	Nov. 04, 2019 USD ($) Rate
Line of Credit Facility [Line Items]
Debt Instrument, Periodic Payment, Principal		$ 16.5
Unamortized Deferred Financing Costs	$ 19.8	19.8	$ 23.1
Long-term Debt	1,589.0	1,589.0	1,598.0
Long-term Debt, Fair Value	1,568.5	1,568.5	1,622.1
Interest Payable	$ 0.2	$ 0.2	0.1
Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Long-term Debt, Gross					$ 100.0
Debt Instrument, Basis Spread on Variable Rate | Rate		3.75%
First Lien Net Leverage Ratio					6.25
Credit Facility Drawdown Floor for Application of First Lien Net Leverage Ratio | Rate					35.00%
Term Loan B (Original)
Line of Credit Facility [Line Items]
Long-term Debt, Gross				$ 1,650.0
Refinanced Term Loan B
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate | Rate	2.50%
Debt instrument face amount	$ 1,608.8	$ 1,608.8	$ 1,621.1
Interest Rate Floor [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate | Rate		0.00%
Interest Rate Floor [Member] | Refinanced Term Loan B
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate | Rate	0.75%

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Debt - Interest Incurred (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Debt Disclosure [Abstract]
Interest Costs Incurred	$ 19,844	$ 18,462	$ 51,076	$ 61,018
Amortization of Debt Issuance Costs and Discounts	1,211	1,148	3,593	3,115
Interest Costs Capitalized	$ 725	$ 438	$ 1,589	$ 1,795

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Derivatives (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		9 Months Ended
	May 31, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Interest Rate Swap [Line Items]
Derivative, Gain (Loss) on Derivative, Net		$ 0.8	$ 1.8	$ 2.5	$ 6.6
Derivative, Gain on Derivative		$ 1.8		$ 1.8
Interest Rate Swap [Member]
Interest Rate Swap [Line Items]
Derivative, Fixed Interest Rate						1.565%
Interest Rate Swaption [Member]
Interest Rate Swap [Line Items]
Derivative, Fixed Interest Rate						0.50%
Proceeds from sale of derivative	$ 0.7
Interest Rate Cap
Interest Rate Swap [Line Items]
Derivative, Fixed Interest Rate		0.31%		0.31%		0.31%
Derivative, Cap Interest Rate		1.50%		1.50%		1.50%
Derivative, Notional Amount		$ 1,000.0		$ 1,000.0		$ 1,000.0
Interest Rate Cash Flow Hedge Asset at Fair Value		99.9		99.9		19.7
Interest Rate Cash Flow Hedge Liability at Fair Value		$ 11.7		$ 11.7		$ 14.8

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Derivatives - Summary of Unrealized Gains and Losses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Unrealized gain, net of tax	$ 25,537	$ 3,040		$ 7,122
Tax expense	$ 7,740	$ 1,010	$ 19,392	$ 2,222

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Stock-Based Compensation Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Sep. 30, 2022	Sep. 30, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, number of shares available for grant (in shares)			8,009,551
Share-based compensation, reduction in shares available for issuance by shares issued pursuant to any appreciation award (in shares)			1
Share-based compensation, strike price as a percentage of the fair market value of the underlying stock on the date of grant			100.00%
Share-based compensation, reduction in shares available for issuance by shares issued pursuant to any stock award that is not an appreciation award (in shares)			1.8
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock Option Contractual Term			10 years	10 years
Share-based compensation, vesting period			4 years	4 years
Employee Stock Option | Vesting on first anniversary of grant date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			25.00%	25.00%
Employee Stock Option | Share-based Payment Arrangement, Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, grant date fair value of stock options			$ 0.0	$ 0.0
Share-based compensation, options granted (in shares)			0	0
Employee Stock Option | Share-based Payment Arrangement, Employee [Member] | Vesting on the last day of each calendar quarter
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			6.25%	6.25%
Service Based RSU
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted - restricted stock units			1,012,000	461,000
Share-based compensation, grant date fair value of stock options			$ 41.0	$ 19.2
Service Based RSU | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted - restricted stock units			57,000	39,000
Share-based compensation, grant date fair value of stock options			$ 2.2	$ 1.6
Restricted Stock Units (RSUs) [Member] | Vesting on the last day of each calendar quarter | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			150.00%	150.00%
Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Nonemployee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted - restricted stock units			7,000	2,000
Share-based compensation, grant date fair value of stock options			$ 0.3	$ 0.1
Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Nonemployee [Member] | Vesting on first anniversary of grant date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			50.00%	50.00%
Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Nonemployee [Member] | Vesting on the last day of each calendar quarter
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			12.50%	12.50%
Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting period			4 years	4 years
Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Employee [Member] | Vesting on first anniversary of grant date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			25.00%	25.00%
Restricted Stock Units (RSUs) [Member] | Share-based Payment Arrangement, Employee [Member] | Vesting on the last day of each calendar quarter
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			6.25%	6.25%
Restricted Stock Units (RSUs) [Member] | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share Based Compensation Arrangement By Share Based Payment Award Ratably Vest After			100.00%	100.00%
Restricted Stock Units (RSUs) [Member] | Director | Share-based Payment Arrangement, Nonemployee [Member] | Vesting on the last day of each calendar quarter
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			100.00%	100.00%
Performance Based RSU
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting period			1 year	1 year
Granted - restricted stock units			248,000	228,000
Share-based compensation, grant date fair value of stock options			$ 9.7	$ 9.5
Performance Based RSU | Executives
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting period			3 years	3 years
Granted - restricted stock units			167,000	110,000
Share-based compensation, grant date fair value of stock options			$ 6.5	$ 4.6
Share-based Compensation Arrangement by Share-based Payment Award, Award Performance Period			2 years	2 years
Share-based Compensation Arrangement by Share-based Payment Award, Other Share Increase (Decrease)	50,000	3,000
Performance Based RSU | Executives | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			0.00%	0.00%
Performance Based RSU | Executives | Vesting on first anniversary of grant date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			50.00%	50.00%
Performance Based RSU | Executives | Vesting on the last day of each calendar quarter
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, vesting percentage, year one			50.00%	50.00%
Outstanding Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted - restricted stock units			1,491,000	843,000

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Stock-Based Compensation Activity of Company's Common Stock Options (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended		12 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding
Options outstanding, beginning of period (in shares)	1,681	2,554	2,554
Cancelled or Expired (Shares)		(1)
Exercised (Shares)	(314)	(844)
Exercised (Dollar Value)	$ 11,244	$ 31,171
Forfeited (Shares)	(2)	(11)
Options outstanding, end of period (in shares)	1,365	1,698	1,681	2,554
Options exercisable, end of period (in shares)	1,345	1,592
Options exercisable and expected to vest, end of period (in shares)	1,365	1,698
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Options outstanding, beginning of period - weighted average exercise price per share	$ 9.35	$ 9.10	$ 9.10
Options cancelled or expired - weighted average exercise price per share		7.78
Options exercised - weighted average exercise price per share	7.78	8.46
Options forfeited - weighted average exercise price per share	14.24	15.45
Options outstanding, end of period - weighted average exercise price per share	9.70	9.38	$ 9.35	$ 9.10
Options exercisable, end of period - weighted average exercise price per share	9.52	8.73
Options exercisable, end of period - weighted average exercise price per share	$ 9.70	$ 9.37
Options outstanding, end of period - weighted average remaining contractual term (years)	2 years 9 months 21 days	3 years 6 months 14 days	3 years 3 months 10 days	3 years 11 months 8 days
Options exercisable, end of period - weighted average remaining contractual term (years)	2 years 9 months 3 days	3 years 3 months 21 days
Options exercisable and expected to vest, end of period - Weighted Average Remaining Contractual Term (Years)	2 years 9 months 21 days	3 years 6 months 14 days
Aggregate Intrinsic Value
Options outstanding, end of period - aggregate intrinsic value	$ 47,312	$ 51,755	$ 53,698	$ 77,182
Options exercisable, end of period - aggregate intrinsic value	46,855	49,552
Options exercisable and expected to vest, end of period - aggregate intrinsic value	$ 47,310	$ 51,732

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Stock-Based Compensation Outstanding RSUs (Details) - Outstanding Restricted Stock Units - $ / shares shares in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Shares Underlying RSUs
Outstanding - restricted stock units	2,550	2,664
Granted - restricted stock units	1,491	843
Forfeited - restricted stock units	(127)	(90)
Released - restricted stock units	(766)	(782)
Outstanding - restricted stock units	3,148	2,635
Vested and unreleased restricted stock units	885	860
Weighted- Average Grant Date Fair Value Per RSU
Outstanding - weighted average grant date fair value per RSU	$ 25.80	$ 18.96
Granted - weighted average grant date fair value per RSU	40.02	41.67
Forfeited - weighted average grant date fair value per RSU	31.85	28.41
Released - weighted average grant date fair value per RSU	32.73	21.22
Outstanding - weighted average grant date fair value per RSU	$ 30.60	$ 25.23

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Equity Transactions (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Mar. 03, 2022	Dec. 31, 2021	Feb. 05, 2021	Dec. 31, 2014
Class of Stock [Line Items]
Total Authorized Preferred Stock, Number	2,000,000		2,000,000
Preferred stock, par value (in dollars per share)	$ 0.0001		$ 0.0001
Preferred stock, shares issued (in shares)								1,500,000
Shares of preferred stock, undesignated and unissued (in shares)	500,000		500,000			500,000
Stock Repurchase Program, Authorized Amount					$ 300.0		$ 300.0
Treasury Stock, Shares, Retired	1,800,000	100,000	6,500,000	3,400,000
Treasury Stock, Retired, Cost Method, Amount	$ 76.5	$ 2.6	$ 245.7	$ 125.1
Treasury Stock, Shares	100,000		100,000
Treasury Stock, Value	$ 3.7		$ 3.7
Stock Repurchase Program, Remaining Authorized Repurchase Amount	$ 187.2		$ 187.2

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Revenue - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenue from Contract with Customer [Abstract]
Liability, revenue recognized	$ 5.5	$ 10.6	$ 21.1	$ 32.4
Accounts Receivable [Member] | Customer Concentration Risk | Prime Contracts with the US Government [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage			30.00%	34.00%

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Revenue - Summary of Service Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue	$ 184,060	$ 162,159	$ 527,198	$ 458,613
Voice and data
Disaggregation of Revenue [Line Items]
Revenue	50,256	45,737	143,621	130,444
IoT data
Disaggregation of Revenue [Line Items]
Revenue	33,786	30,040	92,857	82,018
Commercial Broadband Services [Member]
Disaggregation of Revenue [Line Items]
Revenue	13,589	11,461	37,200	31,531
Hosted payload and other data
Disaggregation of Revenue [Line Items]
Revenue	14,846	14,649	44,769	43,867
Services
Disaggregation of Revenue [Line Items]
Revenue	138,977	127,774	397,947	365,247
Services | Commercial
Disaggregation of Revenue [Line Items]
Revenue	112,477	101,887	318,447	287,860
Services | US Government [Member]
Disaggregation of Revenue [Line Items]
Revenue	26,500	25,887	79,500	77,387
Engineering and support services
Disaggregation of Revenue [Line Items]
Revenue	17,124	7,487	33,789	20,759
Engineering and support services | Commercial
Disaggregation of Revenue [Line Items]
Revenue	1,783	1,249	4,280	2,978
Engineering and support services | US Government [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 15,341	$ 6,238	$ 29,509	$ 17,781

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Revenue - Summary of Contract Costs (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Commissions
Capitalized Contract Cost [Line Items]
Contract Assets	$ 1,471	$ 1,190
Other contract costs
Capitalized Contract Cost [Line Items]
Contract Assets	2,330	2,558
Unbilled Revenues
Capitalized Contract Cost [Line Items]
Contract Assets	$ 14,693	$ 10,752

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Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Tax Disclosure [Abstract]
Income (loss) before income taxes	$ 96	$ (3,545)	$ 10,543	$ (23,477)
Income tax benefit (expense)	$ 2,053	$ 1,460	$ (1,013)	$ 20,042
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	21.00%	21.00%	21.00%	21.00%

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Net Income (Loss) Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Net income (loss) - diluted	$ 2,149	$ (2,085)	$ 9,530	$ (3,435)
Weighted Average Number of Shares Outstanding, Basic	127,697	132,869	128,800	133,763
Weighted Average Number of Shares Outstanding, Diluted	129,075	132,869	130,284	133,763
Earnings Per Share, Basic and Diluted	$ 0.02	$ (0.02)	$ 0.07	$ (0.03)
Employee Stock Option
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Dilutive Securities, Effect on Basic Earnings Per Share, Options and Restrictive Stock Units	921	0	974	0
Restricted Stock [Member]
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Dilutive Securities, Effect on Basic Earnings Per Share, Options and Restrictive Stock Units	457	0	510	0

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Net Income (Loss) Per Share - Anti-Dilutive Shares (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Performance Based RSU
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted earnings per share	0	49	0	101
Restricted Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted earnings per share	0	404	0	547
Employee Stock Option
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted earnings per share	0	1,130	0	1,236

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Related Party Transactions Related Party Transactions (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Related Party Transaction [Line Items]
Related Party Transaction, Due from (to) Related Party, Current	$ 3.6		$ 3.6
Nonconsolidated Investees, Other
Related Party Transaction [Line Items]
Ownership stake	39.50%		39.50%		35.70%
Aireon 2022 Preferred Equity Investment
Related Party Transaction [Line Items]
Payments for (Proceeds from) Investments			$ 50.0
Ownership stake	6.00%		6.00%
Equity Method Investments	$ 50.0		$ 50.0		$ 0.0
Aireon Investor Bridge Loan
Related Party Transaction [Line Items]
Investor Bridge Loan Commitment	10.7		10.7		10.7
Equity Method Investee | Hosting Agreement
Related Party Transaction [Line Items]
Revenue from related parties	4.0	$ 4.0	12.0	$ 12.0
Equity Method Investee | Service Agreements [Member]
Related Party Transaction [Line Items]
Revenue from related parties	5.9	$ 5.9	17.6
Equity Method Investee | Administrative and support agreement accounts receivable
Related Party Transaction [Line Items]
Related Party Transaction, Due from (to) Related Party	$ 2.1		2.1		$ 2.2
Aireon 2022 Preferred Equity Investment
Related Party Transaction [Line Items]
Payments for (Proceeds from) Investments				$ 17.6
Maximum [Member] | Equity Method Investee | Hosting Agreement
Related Party Transaction [Line Items]
Revenue from related parties			200.0
Maximum [Member] | Equity Method Investee | Power Agreement [Member]
Related Party Transaction [Line Items]
Revenue from related parties			3.7
Maximum [Member] | Equity Method Investee | Service Agreements [Member]
Related Party Transaction [Line Items]
Revenue from related parties			19.8
Minimum [Member] | Equity Method Investee | Hosting Agreement
Related Party Transaction [Line Items]
Revenue from related parties			$ 70.5