Iridium said its net loss for the quarter was $505 million, or $3.45 a share. In the year-ago period, the company posted a net loss of $205 million, or $1.45 a share. Analysts surveyed by First Call projected a loss of $3.17 per share.
For the quarter, the company said revenue was $1.45 million. The $180 million loss and the net loss for the first-quarter were in line with the company's projections, spokesman Leo Mondele said in a conference call to analysts and reporters.
The company said in a statement that it had approximately 10,294 subscribers on the Iridium system, including 7,188 satellite customers, 1,031 cellular customers, and 2,075 satellite paging customers.
The first company to offer global satellite phone services said efforts to attract enough customers in the quarter were hindered by several factors, such as limited availability of some handset models and products in many markets, and delays in the overall distribution due to a weak sales team. With Motorola now shipping most of the company's accessories, production is now "adequate," although a number of distribution and importation issues continue to constrain product availability in many markets, according to Iridium.
As previously reported, the company said last week that its CEO Ed Staiano resigned under pressure from the company. Staiano left due to disagreements on strategy with the board of directors, according to the company and analysts. In March, financial chief Roy Grant had announced his plans to resign by April 16, the company said. Grant had resigned for "personal reasons," but Iridium had said it expects to name a replacement before his departure.
The company, which created an executive team headed by interim CEO John Richardson, will continue cost cutting efforts in areas of operation maintenance contracts, financing costs, and operating expenses, the company said in a conference call.
Although the company said it is disappointed in first-quarter results, it did say it is still confident that there's substantial demand for satellite phones and confirmed the company's move to revamp its packaging and marketing strategies as well as adjust services and pricing.
"We're focusing on getting the sales going," said Mondele. He added, "Our immediate financing issue is to renegotiate with our bank by the end of May."
Although Mondele wouldn't elaborate on further projections regarding production and subscriber base figures for the year end, he did say that based on the lessons learned from the first quarter, the company needs to be more careful of projections. He added, "But, we're obviously trying to bring subscriber equipment in customer hands as soon as possible as we go through this period of significant transition."
Mondele also mentioned that Motorola, which is the company's largest single shareholder, is gearing up the sales and marketing areas for the company and has organized a direct sales effort conducted by a group of Motorola sales people.
Shares of Iridium edged up 0.43 to 16.43 in early trading.