Good day, and welcome to the Iridium Communications first quarter 2023 earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the Star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press Star then one on a touch-tone phone. To withdraw your question, please press Star then two. Please note, this event is being recorded. I would now like to turn the Conference over to Ken Levy, Vice President, Investor Relations. Please go ahead. Thanks, Betsy. Good morning, and welcome to Iridium's first quarter 2023 earnings call. Joining me on this morning's call are our CEO, Matt Desch, and our CFO, Tom Fitzpatrick. Today's call will begin with a discussion of our first quarter results, followed by Q&A. I trust you've had the opportunity to review this morning's earnings release, which is available on the investor relations section of Iridium's website. Before I turn things over to Matt, I'd like to caution all participants that our call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical fact and include statements about our future expectations, plans, and prospects. Such forward-looking statements are based upon our current beliefs and expectations and are subject to risks which could cause actual results to differ from forward-looking statements. Such risks are more fully discussed in our filings with the Securities and Exchange Commission. Our remarks today should be considered in light of such risks. Any forward-looking statements represent our views only as of today, and while we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our views or expectations change. During the call, we'll also be referring to certain non-GAAP financial measures, including operational EBITDA, pro forma free cash flow, free cash flow yield, and free cash flow conversion. These non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles. Please refer to today's earnings release and the investor relations section of our website for further explanation of these non-GAAP financial measures and reconciliation to the most directly comparable GAAP measures. With that, let me turn things over to Matt. Thanks, Ken. Good morning, everyone. As you can see, we're off to a great start in 2023. We're continuing to experience the momentum that's been building over the last few years as we take full advantage of our second-generation network. Subscribers, service revenues, equipment, and engineering services all remain strong. We're really hitting on all cylinders, and this continues to generate meaningful growth in our pro forma free cash flow, as well as in value for our partners and user ecosystem. All this reinforces our expectations for another strong year of sales and growth in partnerships and subscribers. On a personal front, it's been a busy few months since our last call with increased travel for industry events, investor conferences, and getting out again to interact with new and existing partners. It's been particularly satisfying to see Iridium's profile raised at these conferences as we are directly in the middle of conversations on key topics shaping the satellite industry, like direct-to-satellite services for smartphones, the ascendancy of LEO networks, in particular for governments of all kinds of proliferated services, and the increased penetration of satellite connectivity in maritime, aviation, and other industry segments. It also made me happy to hear so many established satellite operators acknowledge what Iridium has known for decades. There are natural advantages to operating in low-Earth orbit, and the ability to connect small mobile assets is an important distinction for us that has global utility. For those who have followed Iridium's story over the last five or six years, this is likely not a revelation. We have been focused on IoT and commercial applications that leverage our very unique network. The emerging opportunities on which satellite sector is now focused are a great fit with Iridium's constellation, architecture, and operational strength. In fact, this is what our network was built for. While a lot of industry focus has been on the new direct-to-device market, Iridium continues to lead the way to connect people wherever they are and to the personal devices they use the most. For example, Iridium has more than three-quarters of a million ruggedized personal satellite communicators on our network, and that number is expected to continue to grow significantly in 2023. These consumer-oriented devices allow users to navigate routes, share a location, send and receive texts, and even secure emergency services via SOS. These small, lightweight devices have become a mainstay of outdoor enthusiasts, remote workers, government users, and safety response organizations in recent years, allowing Iridium to drive a compound annual revenue growth of more than 45% from this growing customer segment since 2017. ARPU from these users are relatively low today, but we expect some to adopt our faster Iridium Certus IoT technologies to drive additional utility and higher ARPUs in our commercial IoT business line in 2024 and beyond. We've also had a great reception for our new Iridium GO! exec that we had introduced in the first quarter with over 4,000 in orders booked already. That device expands our Iridium GO! line of satellite hotspot devices to connect with smartphones and tablets to provide a richer data connection when on the move and in remote environments. Best of all, our partners are seeing strong market interest, which underscores longer-term demand for the Iridium GO line of services. Success here should also drive higher ARPUs for our voice and data business in the coming years. We believe the consumer-oriented satellite segment represents a meaningful growth opportunity for Iridium, confirmed by the growing number of devices on our network. The value of providing highly mobile data services on a global basis is indisputable. We expect to add to this growth by supporting new satellite-directed device capabilities that are being introduced later this year. We're excited about our new partnership with Qualcomm Technologies announced in the first quarter, as well as the introduction of their Snapdragon satellite processor incorporating Iridium technology. This chip will integrate Iridium two-way messaging and SOS services into next-generation Android smartphones. A half dozen smartphone OEMs have already announced they will include Snapdragon Satellite in their phones, and we are working with Qualcomm to further expand this list. We're excited about the application of Iridium's network for direct-to-device and the potential upside to our growth projections it will create. We also see additional opportunities in the automotive industry as well as for applications in the government sector, and expect to eventually be relevant in other mainstream consumer devices like computers and tablets. Satellite direct-to-device is an example of a technology convergence going on today between satellite and the traditional terrestrial world, but interest appears to be growing, and I think the opportunities for satellite solutions are endless. We had already seen a lot of convergence within industrial IoT, where many of our partners' satellite IoT applications are deployed with cellular connections as well, expect we'll see even more of this in the future. We believe Iridium's unique constellation is an ideal platform for this convergence, best of all, this sector opportunity is incremental to our core business growth, it's not a material driver of the strong service revenue growth we're forecasting today. In our other business areas like maritime, broadband, aviation, and land mobile, we continue to benefit from strong demand and strategic opportunities. You can see proof of this in our first quarter performance. We continue to take share in the maritime broadband space, where our revenue grew 17% year-over-year in the first quarter and are receiving positive channel feedback that keeps us optimistic about the future. We're hearing from our maritime partners that Starlink is disrupting the traditional VSAT market. While they aren't making much margins on this product, most are starting to deploy Starlink when requested by their customers. While interesting, this trend has little effect right now on our market expectations. As with other VSAT solutions, these partners are deploying Iridium as a companion service with Starlink, and of course, are also deploying this for their GMDSS requirements, as well as vessel monitoring solutions on fishing vessels, anti-piracy and citadel solutions for crew safety, and other diverse applications in maritime. We estimate that an Iridium terminal of some kind is installed on 4 out of 5 SOLAS class vessels at sea today and calculate that Iridium is now installed in some kind of solution on about 250,000 ships of all kinds around the world, and that number is still growing. We also feel very good about the opportunities we're seeing in the aviation market, both in fixed wing and rotorcraft. We are already installed on nearly 70,000 aircraft of all types today, including commercial, business aircraft, helicopters, as well as other general aviation aircraft. That doesn't count all the pilots who take us along as a portable solution for their safety or to take with them when they land. In the aviation market, we're starting to see a transition or expansion from our traditional narrowband voice safety data and IoT services to Iridium Certus midband for faster speeds and new services. We expect to also see Iridium Certus Broadband start to deploy on larger aircraft now that the first 2 antenna systems from partners have been certified. We're expecting additional certifications in 2023 of other partners' antennas, as well as the first Supplemental Type Certificates where the FAA approves these terminals onto specific aircraft types. We've been waiting for this kind of progress for a long time and look forward to the tailwind it can provide for our aviation revenues, which should build into 2024 and beyond. Of course, I also want to highlight our strong land mobile performance. The ARPU was up year-over-year and demand trends continued for equipment and service as we implemented some targeted pricing actions after holding access and airtime pricing stable for several years. Subscriber growth is still strong, though not quite at the level of 2022, which was an unusual year with the incremental demand we experienced from the Ukrainian conflict, as well as the handset shortages experienced by our competitors. We feel good about the durability of our voice business now believe the continued growth for Push-to-Talk and Iridium GO! exec services will help to generate high single-digit growth on average for at least the next few years. Overall, our business environment continues to be robust demand for all of our primary business lines remains strong. As you can see, we logged another record quarter for equipment sales, with orders for handheld devices remaining above trend. Based on feedback from our partners, the supply chain and fulfillment issues experienced by our competitors on handsets have continued into 2023. We still have our own supply chain issues affecting delivery intervals, but we see them mostly abating by mid-year, allowing us to build back our inventories to traditional levels. You'll also note that our engineering and service revenues are up substantially in 2023 on the growing work we're doing for the Space Development Agency in building the ground components of their next-generation network. That's a strategic effort for us, and it's going very well, even expanding beyond the initial award into new work. As we've said before, margins on this business is low compared to our service revenues, but along with other work for commercial and government customers, it is an important enhancement to our relationships and will further our capabilities. Tom will provide additional color on our first quarter results, but I would like to acknowledge the important historical milestone we made on March 30th with the payment of our first-ever dividend. We believe paying a dividend is a smart way to generate returns for shareholders in addition to our ongoing share repurchase program, which was also very active in the first quarter. Together, these shareholder-friendly programs underscore the confidence that we have in our business moving forward and the strength of our enterprise to generate free cash flow. I hope you've had the chance to review our latest environmental, social, and governance report, which was published in March. In it, we highlight our priorities for ESG and speak to our corporate values and culture. I believe our activity in this area demonstrates our commitment to being a good corporate steward on what I would call real ESG matters without sacrificing on business performance or business opportunities. In fact, our support for the communities in which we operate enhances our position with our employees and new hires, and has been welcomed by our partner ecosystem as we demonstrate values that align with their business priorities and interests. You'll notice in this year's report some enhancements to our disclosures, which we hope will allow investors to better appreciate with more detail the factors around our social stewardship, priorities, and impact. As we celebrate this year, the 25th anniversary year of Iridium's initial service launched in 1998, we continue to believe that Iridium is positioned better than at any other time in our history, both for the evolving opportunities in the satellite industry and with our ability to fund growth and reward shareholders. 2023 will be another great year for us with new product rollouts and more exciting announcements. I look forward to keeping you abreast of our progress. I'll turn it over to Tom for a review of our financials. Tom? Thanks, Matt. Good morning, everyone. I'd like to start my re-remarks by summarizing our key financial metrics for the first quarter and providing some color on the trends we're seeing in our major business lines. I'll recap the 2023 guidance, which we reaffirmed this morning and close with a review of our liquidity position and capital structure. Iridium continued to execute well, generating total revenue of $205.3 million in the first quarter, up 22% from the prior year's quarter. Operational EBITDA was $111.9 million in the first quarter. This was an 8% increase from last year's quarter and driven by increasing engineering and support revenue, growth in service revenue, and another record quarter of equipment sales. On the commercial side of our business, service revenue was up 13% this quarter to $112.8 million. This increase was broad-based and reflected continued strength in voice, IoT, and broadband, as Matt mentioned. Voice and data revenue rose 17% from last year's comparable quarter to $52.4 million. The increase was largely driven by higher ARPU related to targeted price changes adopted in the first quarter. We also benefited from strong growth in our Push-to-Talk and Iridium GO services. As Matt noted, the increase in access charges was our first price action in commercial voice since 2018. We expect to be durable, keeping ARPUs in the mid-40s and providing a growth tailwind to voice and data this year. To date, we've been pleased with how the new pricing has been received by the market. It hasn't meaningfully affected net subscriber additions, demonstrating the value that end users see in our services. Commercial IoT revenue totaled $32 million in the first quarter, up 12% from the prior-year quarter. We continue to see ongoing demand for personal satellite communications, an area in which our partners continue to invest in their retail-focused products. While these subscribers generate lower ARPU than our traditional industrial IoT users, they remain a very attractive contributor to our service revenue growth in light of the minimal comparative network resources they consume. As a result, IoT ARPU was $7.22 this quarter, compared to $7.78 in the prior-year period. We believe this consumer-oriented sector will remain a strong driver of revenue and subscribers and believe that the integration of new Iridium Certus technologies into these products will increase data usage and potentially ARPU too. Revenue in commercial broadband grew 17% from the year-ago period to $13.4 million. Supporting this growth was an increase in ARPU, driven by a mix shift among maritime subscribers to Iridium Certus from our legacy Iridium OpenPort service, as well as market share gains driven by Iridium Certus 200 and 700 services. Broadband remains an important component of our long-term growth, we continue to expect it will drive double-digit revenue and subscriber growth in 2023. During the quarter, we added 52,000 net new commercial subscribers with the gain predominantly by IoT. Commercial IoT data subscribers now represent 79% of billable commercial subscribers, up from 76% in the year-ago period. We estimate that consumer-oriented plans now account for about half of our 1.5 million commercial IoT users. Hosting and other data services revenue was $15 million this quarter, in line with last year's comparable quarter. Government service revenue was also stable in the first quarter at $26.5 million, reflecting the terms of our EMSS contract with the U.S. government. Subscriber equipment, which has remained at record levels over the last year, grew 24% in the first quarter as demand for hardware supporting our commercial business lines remains robust. Equipment sales were $41.7 million in the first quarter compared to $33.7 million in the prior year period. Engineering and support revenue was $24.2 million in the first quarter as compared to $8.4 million in the prior year period. The rise in activity reflects new government work for the Space Development Agency, a contract that we won last year, as well as incremental development revenue from our commercial relationships. While we continue to forecast year-over-year growth in engineering in 2023, revenue will fluctuate from quarter to quarter based upon execution and milestone achievements. Our first quarter results, as well as the trends we are seeing into April, allow us to affirm our full year guidance on service revenue and EBITDA. In support of this outlook, I want to highlight a few items that may be relevant to your models and the cadence of Iridium's growth this year. We remain comfortable with our outlook for service revenue growth between 9% and 11% in 2023, in part due to continued strong net activations and revenue growth across all of our commercial business lines. As I mentioned earlier, the price actions for commercial voice will serve as a tailwind this year. Given the positive effect of this higher ARPU and considering other favorable trends in this business, we now expect that annual growth in commercial voice and data will average in the high single digits between 2023 and 2025. Revenue from our EMSS contract with the U.S. government will remain steady at $26.5 million per quarter in 2023. There is no increase in the contractual fee schedule this year. The next step-up will occur in 2024. Equipment sales set another record this quarter as demand for our satellite handsets in all our products remains elevated. Based upon current partner orders, we continue to believe that hardware sales in 2023 will be in line or even possibly exceed 2022's record level. On the expense side of the ledger, we continue to forecast higher costs related to stock-based compensation and new employee hires as we upgrade and retool business systems. These dynamics resulted in a 48% increase in SG&A in the first quarter, which we expect to moderate in the balance of the year. You recall that SG&A grew over the course of 2022, with first half expenses at $54.8 million and second half expenses at $68.7 million. Accordingly, we expect the second half of 2023 to be much more in line with 2022 expenses and continue to forecast that full year 2023 expenses will be up by about 20%. R&D will also run higher in 2023 as our team supports a number of new products coming to market. We feel very good about the broad-based growth we are seeing across our businesses and believe that the incremental expenses we will have in 2023 are appropriate and necessary as our business continues to grow. Taken together, these trends allow us to reiterate our forecast for service revenue growth between 9% and 11% and Operational EBITDA between $455 million and $465 million this year. Moving to our capital position. As of March 31st, Iridium had a cash and cash equivalents balance of $126.6 million. Iridium's robust cash flow is one of the reasons that our board continues to support our share repurchase program and initiated a quarterly dividend program. As Matt noted, Iridium's board initiated a quarterly dividend in December 2022, and on March 30, we paid a dividend of $0.13 per share. Iridium's dividend program will allow for the return of approximately $65 million of cash to common holders in 2023 and reflects our confidence in our business opportunities and strong free cash flow generation. In the first quarter of 2023, Iridium also purchased approximately 900,000 shares of common stock at an average price of $59.84, for a total of $53.1 million. Since the end of the quarter, we've bought back an additional 500,000 shares for a total of $29.4 million, leaving us with $97.1 million of capacity outstanding on our share repurchase program. We will continue to execute on our buyback program, balancing our objective for deleveraging with the desire to maximize return on investment. In the first quarter, we also increased our investment in Satelles by $10 million as they raised additional capital to expand their commercial business. Satelles' satellite time and location service continues to have relevance to commercial partners and governments who seek a complement to GPS and other GNSS services, which are susceptible to interference and spoofing. Satelles' offering leverages Iridium satellite constellation to protect critical national infrastructure and assured PNT solutions, and we remain very optimistic about their unique offering and business opportunities. Iridium's net leverage was 3.2 times of EBITDA at the end of the first quarter. This was down from 3.5 times a year earlier, even when factoring in our share repurchase and dividend activity during the first quarter. Our long-term target for net leverage continues to be between 2.5 and 3.5 times of EBITDA at the end of 2023, inclusive of quarterly dividends and giving effect to all outstanding share buybacks authorized by our board. Capital expenditures in the first quarter were $22.9 million, including one-time spending of approximately $11 million related to this year's planned launch of spare satellites. As we noted on our fourth quarter call in February, we expect annual capital expenditures over the forecasted 10-year CapEx holiday period to average between $50 million and $60 million. Excluding launch-related costs, 2023's capital expenditures should fall in line with this long-term forecast. Turning to our pro forma free cash flow. We use the midpoint of our 2023 EBITDA guidance and back off $75 million in net interest, approximately $75 million CapEx for this year and $14 million in working capital, inclusive of the appropriate hosted payload adjustment. We're projecting pro forma free cash flow of almost $300 million. These metrics represent a conversion rate of EBITDA to free cash flow of 64% in 2023 and a yield of approximately 4%. A more detailed description of these cash flow metrics, along with the reconciliation to GAAP measures, is available in our supplemental presentation under Events on our investor relations website. In closing, Iridium continues to benefit from our robust operating environment and strong demand for our equipment and services. We plan to return capital to our shareholders, fund new projects, make strategic investments, and are looking forward to the launch of five ground spares next month. We think this quarter is a good reflection of the Iridium game plan, generating strong operating results, returning capital to shareholders, and making strategic investments that position us for future growth. With that, I'll turn things back to the operator for the Q&A. We will now begin the Q&A session. To ask a question, you may press star, then 1 on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. The first question comes from Ric Prentiss with Raymond James. Please go ahead. Thanks. Good morning, everyone. Hey, Ric. Hey. Obviously a strong start to the year. Have a couple of questions. Obviously, one of the bigger areas that people are trying to focus on is the direct-to-device opportunity. Can you help us understand? I know you've said there's not gonna be much meaningful impact on the service revenue side this year from direct-to-device, but have we seen some direct-to-device already showing up? It seems like the engineering and support levels that got reported might have already had some in there. Just trying to gauge, when will you break out kind of direct-to-device as a category, and have we already seen some to date? Yeah, if you look at our Q, Ric, we say that, the commercial engineering and support increase is principally, directed device or Qualcomm relationship. Okay. Makes sense. How long should that development fee kind of concept continue? Is that something that can run for several more quarters of this year? Does it run into next year? We'll see. We don't expect it currently, but we'll see. There's opportunities for additional, but time will tell. Sure. Okay. The royalties start kicking in. Will that go into that same line item, commercial engineering and support? Yeah. The vast majority is gonna be in service revenues. Initially, it'll be in hosted payload and other, and then when it gets big enough, we'll likely break it out. Royalties would go into hosted payload and other, then maybe break it out. Okay. Obviously, a lot of people are watching IoT ARPU as well. You've called out that you've seen obviously the mix change, but maybe service can help. How should we think about the current ARPUs in that personal communication area? Is that kind of mid-single digits? As we think of direct-to-device, it feels like that service might be priced a little bit underneath it, given what that will bring to the market. Is that fair thinking? If I follow that last part of your question, Ric, you said what is priced underneath the market? The current personal communication devices, should we think that's kind of a mid-single-digit ARPU? As we think of directed device coming online, is that something that would be a ARPU below kind of personal communication device ARPU? Yeah. It would be below, you're right roughly in terms of what personal communications ARPUs are, maybe, just slightly below mid-level, single digits. Yeah, it would definitely be below that level. Okay. But obviously- Last one for me. The volume can be a lot higher, you know, so that obviously would be part of it. Yeah. Exactly. Price times quantity could be a lot of quantities. The last one for me, appreciate all the questions. The pacing in the quarter of stock buyback ramped up significantly in March. Sounds like you've done a good bit in April. How should we think about how you look at that shareholder return equation and putting money to work on the stock buyback? What's the lever that says, "Okay, now it's time to put more of the free cash flow production into the buybacks"? Our algorithm is we wanna return to where we think an appropriate return to where we think intrinsic value is, and we execute on the buybacks when we think the return is appropriate, Ric. Okay, great. Appreciate all the answers. Everyone do well. Okay. Thanks, Ric. The next question comes from Landon Park with Morgan Stanley. Please go ahead. Great. Good morning, everyone. Thanks for taking the questions. I wanted to dig in on the voice and data segment. That's obviously been a pretty surprising source of upside over the last, you know, year or two here. You know, can you maybe disaggregate that high single-digit growth target that you're laying out and maybe just delve a little bit more into what gives you the confidence that the current trends can continue out a couple of years, and even if we potentially have to lap or, you know, comp against this Ukraine benefit reversing at some point? Just on that, maybe if you could size what you think that Ukraine benefit has been and how you're thinking about that moving forward? Well, maybe Tom can talk to the Ukrainian benefit, which I think in the biggest scheme is kind of small overall. We have, for the last several years, seen strong demand for our handsets. There is a competitive dynamic there. It appears, you know, we've definitely sort of outlasted everyone, and our services seem to be appreciated more than anyone else's and have a, you know, a very strong position in the market that we've been appreciating for a while. You know, as you can see, we've finally sort of announced a price increase this year. It's a price increase, by the way, we've been planning for a long time. I know there were a number of questions in previous calls over our ability to do that, and we certainly felt it was an appropriate time after not having done that for, you know, a good 4 or 5 years. Market seemed to not be affected very much in terms of that. They still the demand for our devices continues to remain high, and our partners have told us that they see long-term demand and are, you know, almost working in a very high way with us versus anybody else at this point. All those things in addition to new technology, things like Iridium GO! exec, things like Push-to-Talk, all those are now giving us, you know, kind of the visibility for the next couple of years in which Tom described through 2025 a high single-digit growth rate. You know, yes, that's a big difference. You know, that's on the average, of course. That is, you know, a big difference from sort of where we thought 5 to 10 years ago. We thought this was clearly a strong, steady, you know, low single-digit kind of grower. I think that the market dynamics and demand and technology have all given us a lot of confidence now that that that is not gonna be that for the next couple of years. I would just amplify Matt's remarks. In 2023, if you just do the math on where the ARPU that I've indicated is gonna be, you know, we're gonna be a solid double-digit grower in 2023. You know, the guide is intended to have you think about 2024 and 2025. You put the 3 together, the average annual rate we think is gonna be high single digits. That takes into account all of the dynamics that Matt referenced. We think we're this segment is more growthy than it had been for a decade. Then we said that when we observed the results last year, and we think that GO! and Push-to-Talk or that is an ongoing benefit that changes the complexion of this segment. There are competitive dynamics that are hard to predict really. What we're observing in our handset sales, et cetera, give us confidence to put that guide out of the average high single digit growth between 2023 and 2025, Landon. By the way, Landon, I also would say that, you know, we've already seen the reversal of sort of the Ukrainian situation. I mean, that was a strong bump in the first quarter of last year. We're not seeing that this year, and so all of our guidance is really relevant to sort of a, you know, a reversal of that already. Well, you're lapping it, but has it come out of the base, I guess is, was more the question? No, it hasn't. I wouldn't say it's come out of the base. We didn't see the adds. If you look at commercial voice and data net adds in the first quarter, look at it for the past five years, last year's first quarter jumps off the page. Clearly we got a bump in adds last year. That's not come out, but you didn't get the, you know, the activation occurred and they're still being used, but there's no bump in activation. Just to the extent that it could reverse it, yeah, actually reverse out at some point, are you able to talk about the magnitude? No. Just on the ARPU, I just wanted to. I might have missed your comment. Can you clarify the size of the pricing action? Yeah. We've said that ARPUs are going to be in the mid-$40s. Okay. That's $4 high than running. That's durable, notwithstanding, you know, Ukrainian reversal. Okay. The magnitude of what that would look like reversing out or... Well, the number of devices in Ukraine still, you know, incrementally, those all were turned off immediately, would be, I mean, less than 1% of our base. Okay. Significantly, probably less than a percent of our base. That's not really driving our results at all at this point. Understood. That's very helpful. Then, just two more, if I could. Your primary geo competitor, you know, has had an outage recently in the APAC region. You talked about the value of, you know, LEO and proliferated the LEO design up top. Can you talk about if you think there might be some sort of competitive impact of that outage? I don't know if you've heard anything. It's obviously a fluid situation. Anything you can comment there? We haven't heard anything more than anyone else publicly has. Obviously, they've made public statements about that. There has been probably a focus in the Asia Pacific region after that happening a couple of times there on our services. It may have a positive impact, you know, going forward. I think it highlights the difference in our architectures. You know, we haven't had any kind of satellite outages, but if we did, you know, satellites move around the planet in a LEO so quickly it would never have, you know, this kind of impact on any region that would have really literally minutes at any one point on Earth, you know, during the day. We obviously have a lot of spare satellites and more coming even next month. I think our brand is resiliency and quality and high level of service and we'll continue to focus on that and perhaps there'll be benefits there. Great. Just one last one on direct-to-device. The royalty payments associated with the future unit sales, is that? Do we expect that to be something below, like, $0.50 per unit, or are you able to provide any color there in terms of what that will look like on a per unit basis? Yeah. We really aren't exposing our contracts at this point yet. You know, we don't even have the first units in service. That will happen in the coming months. You know, I think sometime in the future, you'll hear more about that. You know, really trying to give you a range or something would be really inappropriate at this time. That would just be too much information, really, at this point. Understood. Thanks for taking all the questions. Yeah. Thanks, Landon. The next question comes from Hamed Khorsand with BWS Financial. Please go ahead. Good morning. Could you first talk about, you know, your comments about the, you know, the different vertical tangents that you're looking at, auto, you know, particularly, is that happening now or is that just conversation? Where does that stand from a revenue opportunity for you? We're working the details and planning and, you know, and discussions and, you know, given that the technology work is, you know, largely complete at this point because it's, the integration has been in and tested and has been integrated into smartphones, it wouldn't take long, essentially, to implement the technology into automotive. What's different about automotive, though, is those design cycles for, you know, for cars are quite long. I don't know how long it would take, you know, for, you know, Snapdragon Satellite to enter in the automotive space, but I doubt that it will impact revenues nearly as fast as the smartphone industry, just on how that kind of design work happens. I think that's a few years away. You know, we're just giving a highlight to sort of upside to this technology integration, and the fact that we have selected such a strong and strategic partner here, that we're working with, who has broad-based capabilities in other industries as well. Okay. My other question was on the IoT side, the number of additions this quarter was I think approximately like 38,000, which is, you know, it seems like it's slowing down. Is that purely because of, you know, consumer, you know, spending changes, or is that, you know, partners delaying new product introductions? No, we. That's just seasonality. You know, the first quarter's slower. First and fourth are slower, second and third are stronger. I don't think your numbers are right. I think, I think it's more like, net billable subscriber adds were 53,000 in 2023 versus, you know, 50,000 last year. It's actually, you know, up a bit. You know, each quarter it's hard to validate, you know, within a few thousand exactly how many there'll be. We have so many different partners and so many different segments. I don't think you can read much into, you know, first quarter results either way, you know. Okay. Thank you. Yeah. Thanks, Hamed. Next question comes from Louie DiPalma with William Blair. Please go ahead. Matt, Tom, and Ken, good morning. Thank you. Good morning. Morning, Louie. For Matt and Tom, at the Barcelona Conference, Qualcomm announced that it will make Snapdragon Satellite available for, I believe, mid-tier Snapdragon 4 devices in addition to the previously announced Snapdragon 8 high-end premium devices. Last quarter, you provided a TAM estimate of around 80 million-100 million phones a year. I was wondering, how is that impacted with the potential inclusion of Snapdragon 4 devices that may incorporate the satellite feature? Well, I mean, From what we understand, there's a lot more of those mid-tier Snapdragon devices being shipped to satellite phone manufacturers than there are high-end ones that we've already sort of described. The opportunity is quite large. It will just depend on how many phone manufacturers decide to, you know, adopt the technology. Our hope would be high because it's not, you know, incrementally a lot to necessarily do that. I think most of the focus really on late 2023 and 2024 introductions will be at the high end, but I do see long term that that will expand, you know. Great. Thanks, Matt. Are you able to say if the royalty rate for the mid-tier Snapdragon 4 devices is lower than the royalty rate for the premium Snapdragon 8 devices, or is that still in negotiations? It's totally premature to talk about either relative levels or actual levels of royalties of any sort at this point, Louie. Sorry. No problem. That's completely understandable. For Tom. Tom, you referenced higher R&D this year, I think for, like, new devices. Is that R&D to support the Qualcomm partnership, such that our Iridium software developers and, like, radio frequency engineers, like, actually working on that, or is this higher R&D to support, like, other new devices, perhaps in the consumer, IoT sector? I would say other devices in the consumer sector and generally. Yeah. We feel there's a lot of opportunity right now for Iridium. You know, given our success and growth, you know, we have a long list of things that we wanna develop both in our, that require both work on the ground and the gateways, work in cloud, work in device work. You know, there's just a lot of opportunities. We've expanded our investment, you know, because we believe it's the right time to do that because we believe we can support it in our, in our growth projections here. Great. And Tom, did you also say, as it relates to the IoT ARPU, that there might actually be expansion going forward, or did I mishear that? No. We said that the service functionality should drive higher data usage, which would drive higher ARPUs, Louie. Okay. For those services, would that be for consumer devices- Yeah. Like, similar to the ZOLEO and-. Think of the Garmin device pushing pictures. That's higher usage. Yeah. That's higher ARPU. Okay. Yeah. Yeah. We know that there's been some adoption amongst our partners, and they have plans to introduce products in the future which would offer even more capabilities than we have today. I mean, obviously it'll take some time for that to affect overall ARPUs because those have to get in the market, and there's an awful lot of devices already given that we're soon to be pushing 1 million devices as well, you know, just that use more narrowband technology. But it's obviously a positive long wind on ARPU. But... Great. Thanks. That's it for me. Thanks, Louie. As a reminder, if you would like to ask a question, please press star then one to be joined into the question queue. This concludes our questions. It looks like we have a follow-up from Ric Prentiss from Raymond James. Please go ahead. Yeah. Thanks. I figure there's a few minutes left on a busy earnings day. Probably be remiss if we don't ask the recession question or economic condition question. Are you seeing any impact out there globally as far as what the macro market is, or it's just the demand for the product still just super strong? Well, I don't think we've seen any big impact whatsoever. You know, we just held our first partner conference in a number of years here in California a couple weeks ago. you know, I'd say the enthusiasm of our 500+ partners is as high as I've ever seen in the future. There was no wringing of hands in any specific market segment. You know, I keep looking for, you know, particularly things like the consumer-type segment to possibly, be affected in different places, and hard to see those trends yet. you know, I think we're being conservative overall here. I mean, we're not projecting out too far or anything just in case there are bigger effects. no, I- That's all for me. I don't think there's been much. you know, we have, we have history. I mean, 2008, 2009 wasn't a great time in the world, and we didn't see a lot of impact then. haven't, you know, we've kind of experienced, sort of regional market downturn. I think satellite services like Iridium's are very valuable services. They're ones that, you know, are critical to life, that sort of thing, and I don't think they're the first ones that would be cut in some sort of a recession. Okay. And last one, using up some more time. Tom, any thoughts on the balance sheet? Anything you can do on the debt level or anything you might do as far as thinking of your interest costs? Well, you know, we're, we have a billion-dollar cap on our, we're hedged with $1 billion. We paid down $100 million, we're, you know, we're diligent about it, Ric, we feel like we've contained our exposure to interest rates. I think by aboutline what we're gonna do, we're gonna continue to buy into shares, make strategic investments, pay the dividend. That's the game plan. Any update on Aireon as far as how that business is going? Still very positive. I mean, they're, they continue to grow. They're investing in their commercial data services business, and they're seeing traction there. You know, I believe that's a long-term opportunity. Actually, starting now that the air traffic has come back to more normal levels, that both is kind of increase their revenue levels, but also has started to get some other markets moving in terms of adopting their traffic control services. I would say mostly positives over there. Tom, you mentioned an investment by y'all into Satelles. I missed that number. What was the investment? $10 million, there. 1- 0? 1-0. Okay, great. Thanks everyone. Stay well. The next question is a follow-up from Landon Park with Morgan Stanley. Please go ahead. Thanks for taking the follow-up. I just wanted to ask about the service aviation products. I mean, now that those are coming into the market, I was wondering if maybe you could remind us of the TAM that you see there on the commercial plane front for the larger service products. I seem to remember pricing being quite, or at least pricing expectations at your Analyst Day were quite high, I think $600 plus. Is that still the right range to think about there? It's a little too early to, you know, project because they don't, you know, our partners sort of our commercial expectations for the service product line versus others. We know it should be higher, because it, you know, more data and more service through it. The initial applications are gonna be primarily in, for the broadband products, are gonna be in commercial airliners, which is high. Those things are always flying and especially as they move into safety services, I think you're gonna see those also, you know, continue to sort of push up ARPUs and potential on that front. You know, somewhat into some business aircraft and then a lot into rotorcraft. A lot of interest in the mid-band products in rotorcraft. Then in drones, that's still a very early market segment, but very positive in terms of just the activity and, you know, unmanned aerial vehicles. You know, we're at the really early stages of that. I'm really happy that we got 2 terminals and more coming. We're hearing about their wins with specific platforms and the STC that they're both getting and planning for this year. I think that's gonna build kind of, I wouldn't say fast, but I, you know, it's gonna take time, but I think we're gonna start seeing a few thousand adds a year there, which will add to that, you know, roughly 70,000 aircraft installed with good or better ARPUs than we've seen before. The safety version of those products, which is where, which is what they're really looking for, come towards the end of this year and into next year, with flight trials and that sort of thing. That will also improve the business there in the aviation segment. Okay. Understood. Just one last one for maybe for you, Tom. On the operating leverage front, it's sort of limited this year because of, you know, the investments in the business and the SDA contract. Is that something that we should expect in 2024 and beyond to be more more in the cards for you guys in terms of expanding your EBITDA margins? The operating leverage is intact, right? If you look for the variable cost to produce an incremental minute of use, it's really kind of hard to find. The operating leverage is intact. I agree with you that SDA kind of, you know, because the SDA contract is so big, is relatively big and lower margin, it appears that there's, you know, that the EBITDA margin has decreased. That is not because the operating leverage isn't in the business. You know, it's the same fundamentals of the cost to produce an incremental minute are intact and we will continue to grow EBITDA as to our service business. As service revenues grow, EBITDA should grow. That's true of equipment too, I mean. Right. Lower margin, but has increased dramatically over the last two or three years. You know, this is all positive. It all falls to the bottom line and generates cash for us. It's a good thing. I mean, the 20% SG&A growth the last, you know, this year and last year, is that something that we should think will moderate a little bit at some point? Yeah. How should we think about the growth rate? That'll moderate over time. Okay. Understood. Thanks for taking the questions. Sure. The next question is a follow-up from Louie DiPalma with William Blair. Please go ahead. Hi, guys. I have a question in terms of why have your satellite phone competitors experienced major supply chain issues, but it doesn't seem to have really impacted you? You know, I have my own personal ideas about that. I'm not sure it's appropriate for me to describe, you know, a competitor's issues or problems. I think their businesses is smaller. I think they perhaps outsource more of their technology to others, and so they don't have quite the supply chain control over the situation that we do. I can only speak to the excellent work my team does. We've been doing this longer than anyone has. We have more breadth of experience, perhaps. I really think I more would rather focus on sort of the positives of what we've done. Right. It looked a little scary, I would say, you know, a year, a year and a half ago as we were hearing from supply chain partners that things that we were expecting to come in, parts that were, you know, had one week or three-month kind of interval suddenly got pushed out a year. You know, perhaps because of the importance of our products and the markets they serve, perhaps just the excellent relationships with the supply chain my team has, they really jumped on that fast and just worked at really hard. Maybe our volumes are higher and drives higher priorities from supply-suppliers than maybe others do. I think we're on top of it now. I think it's pretty much pretty much over from almost all products, certainly phones. Remember, during that whole time, in our case, I mean, we had the incremental challenge of higher demand. We were grabbing all the demand of others, was being poured onto us just at the time we were working through those challenges. That was an additional complexity we had to work with. I just owe it to the expertise and competency of my team more than anything else. I would just amplify that to Matt to say, like, our satellite phone business is highly strategic to us. We are not reluctant at all to invest in safety stock and support that business. It's unclear that our competitors feel the same way about their handset business as we feel about ours. Great. Thanks, Matt and Tom. Also earlier this year, you launched the Iridium GO! exec, which seems like a really exciting device. What has been the initial feedback of the GO! exec from your channel partners? Does the service revenue for that product, does that go in the commercial voice and data reporting segment, or does it go into the IoT reporting segment? Yeah, it goes into commercial voice and data. As far as reception, very high. You know, it's a unique product. There isn't anything sort of supplying that speed on a portable battery-powered basis that allows a smartphone or tablet to do more than just, you know, connect with just texting. I mean, it allows higher speed services. It allows email. I was using it myself, the other day on a long flight. You know, multiple voice lines. It's extremely flexible, has open interfaces, so we're seeing application providers start to adapt their products to it so that they can drive specific applications, which means they're gonna be selling the product as well. I think, you know, we announced today that there are 4,000 orders, which I thought was very, very positive for a very first, you know, fill the channels and people. We've even had some reorders already. I think it's a great introduction to that product. And it's kind of addictive. You know, once you find that kind of value, you kinda can't help but use it more. I'm imagine it will be a positive, you know, headwind for tailwind for our ARPUs, you know, in that general segment, even though it'll be quite small compared to all of our other revenues to begin with. It's a positive addition. Right. Sounds good. Thanks. Thanks, everyone. Thanks, Louie. This concludes our Q&A session. I would like to turn the Conference back over to management for any closing remarks. Yeah. Obviously, we'll see you again in July, but I'd remind you that we're scheduled at Investor Day in New York on September 21st. I hope you all can join us there because we are planning to provide, you know, more details about, you know, what makes us confident in our longer term projections and how we think our long-term model looks like and why we believe our growth projections are the way they are. Join us then. We'll look forward to seeing you. Thanks for joining us on this call. The Conference has now concluded. Thank you for attending today's presentation. You may now disconnect.