• Revenue: $6.6 million in Q2 2024, up from $6.5 million in Q2 2023.

• Average Revenue Per User (ARPU): $1,200 in Q2 2024, an 8.7% increase from $1,104 in Q2 2023.

• Adjusted EBITDA: $0.9 million in Q2 2024, an 88% increase from $0.5 million in Q2 2023.

• Net Loss: $3.2 million in Q2 2024, a 25% decrease from $4 million in Q2 2023.

• Customer Churn: 1% in Q2 2024, down from 1.2% in Q2 2023.

• Cash Flow from Operations: $0.8 million generated in Q2 2024, compared to a $1.2 million outflow in Q2 2023.

• Cash and Cash Equivalents: $3.6 million at the end of Q2 2024.

• Warning! GuruFocus has detected 6 Warning Signs with TSX:TGO.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Revenue, ARPU, and gross margin have increased, contributing to adjusted EBITDA growth.

• The company has generated a cumulative positive cash flow from operations of $4.2 million over the past four quarters.

• Churn bookings are significantly lower due to effective churn strategy initiatives.

• ISED's announcement ensures TeraGo retains and renews its millimeter wave spectrum licenses, providing certainty for future operations.

• Adjusted EBITDA increased by 88% compared to the same period last year, indicating improved profitability.

Negative Points

• Net loss for Q2 2024 was $3.2 million, despite improvements, indicating ongoing financial challenges.

• Higher interest costs on the debt facility partially offset the benefits of reduced operating expenses.

• Total revenue growth was modest, increasing only slightly from $6.5 million to $6.6 million year-over-year.

• The company still faces challenges in accelerating revenue growth despite strategic initiatives.

• Cash and cash equivalents at the end of Q2 2024 were $3.6 million, which may limit flexibility for future investments.

Q & A Highlights

Q: Can you elaborate on the impact of ISED's spectrum decision on TERAGO's future plans? A: Daniel Vucinic, President and CEO, explained that ISED's decision to allow TERAGO to retain and renew its millimeter wave spectrum licenses provides certainty and clarity. This enables TERAGO to continue driving competition, innovation, and increased investments in next-generation wireless connectivity offerings for Canadian businesses.

Q: How has the company's financial performance improved over the past year? A: Rajneesh Sapra, CFO, highlighted that TERAGO's adjusted EBITDA increased by 88% to $0.9 million in Q2 2024 compared to $0.5 million in Q2 2023. The company also reduced its net loss by 25% to $3.2 million, driven by optimized cost structures and efficient business operations.