KVH Industries, Inc. reported a decline in net sales for the third quarter of 2024, totaling $28.971 million, down 13% from $33.195 million in the same period of 2023. For the nine months ended September 30, 2024, net sales were $86.911 million, a decrease of 14% compared to $100.924 million in 2023. Service sales, which primarily come from satellite Internet airtime services, fell by 17% to $24.410 million for the quarter and by 15% to $74.100 million for the nine-month period. Conversely, product sales increased by 20% to $4.561 million in Q3 2024, driven by a rise in Starlink product sales.
Total costs and expenses for the third quarter of 2024 were $30.962 million, down from $38.345 million in 2023, resulting in a loss from operations of $(1.991) million, an improvement from $(5.150) million in the prior year. The net loss for Q3 2024 was $(1.199) million, compared to $(4.369) million in Q3 2023. For the nine months ended September 30, 2024, the net loss increased to $(6.738) million from $(3.229) million in 2023.
The company’s accumulated deficit worsened to $(8.442) million as of September 30, 2024, compared to $(1.704) million at the end of 2023. Total stockholders’ equity decreased to $142.698 million from $147.372 million over the same period. Cash and cash equivalents increased to $14.396 million from $11.294 million at the end of 2023.
KVH has made strategic moves, including a staged wind-down of its manufacturing operations announced in February 2024, due to reduced demand and increased competition. This restructuring led to the layoff of approximately 75 employees, or 20% of the workforce, and incurred severance charges of $2.9 million. The company also expanded its relationship with Starlink, prepaying $17 million for access to a large block of data, which is expected to enhance its service offerings.
The company’s financial performance reflects the challenges posed by increased competition, particularly from low Earth orbit (LEO) satellite service providers. Despite the decline in service sales, KVH's product sales growth indicates a shift in focus towards hardware offerings, including the recently launched Starlink terminals. The marine leisure business remains highly seasonal, with expectations of revenue declines in the latter half of the year.
About KVH INDUSTRIES INC \DE\
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