• Record quarterly revenue of $53.7 million exceeded guidance and increased 31.5% year-over-year
  • Signed 34 DAS carrier contracts through the first nine months of 2017
  • Raising full year 2017 guidance

LOS ANGELES, Nov. 02, 2017 (GLOBE NEWSWIRE) -- Boingo Wireless (NASDAQ:WIFI), the leading distributed antenna system (DAS) and Wi-Fi provider that serves carriers, consumers and advertisers worldwide, today announced the Company's financial results for the third quarter ended September 30, 2017.

Third Quarter 2017 Financial Highlights
  • Revenue of $53.7 million increased 31.5% compared to $40.8 million in the third quarter of 2016. Growth was driven by strength in wholesale Wi-Fi, military and DAS.  
    • Wholesale Wi-Fi revenue of $8.3 million increased 41.1% compared to $5.9 million in the third quarter of 2016. 
    • Military revenue of $13.9 million increased 37.6% compared to $10.1 million in the third quarter of 2016. 
    • DAS revenue of $21.8 million increased 36.3% compared to $16.0 million in the third quarter of 2016. DAS revenue for the quarter was comprised of $16.1 million of build-out project revenue and $5.7 million of access fee revenue. 
  • Net loss attributable to common stockholders was $(3.5) million, or $(0.09) per diluted share, compared to a net loss of $(5.7) million, or $(0.15) per diluted share, in the third quarter of 2016. 
  • Adjusted EBITDA of $19.8 million increased 71.1% compared to $11.6 million in the third quarter of 2016. Adjusted EBITDA, which is a non-GAAP financial measure, is defined below and is reconciled to net loss attributable to common stockholders, the most comparable measure under GAAP, in the schedule entitled "Reconciliation of Net Loss Attributable to Common Stockholders to Adjusted EBITDA."   
  • Net cash provided by operating activities was $20.1 million compared to $37.9 million in the third quarter of 2016. 
  • Free cash flow was a negative $2.7 million compared to $10.1 million in the third quarter of 2016. Free cash flow, which is a non-GAAP financial measure, is defined below and is reconciled to net cash provided by operating activities, the most comparable measure under GAAP, in the schedule entitled "Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flows."

               Business Highlights
  • The Company signed 12 long-term carrier leasing agreements in the quarter, bringing the total to 34 carrier leasing contracts for the first nine months of 2017. As of September 30, 2017, there were 22,200 DAS nodes live with another 11,000 nodes in backlog. 
  • The Company launched carrier offload services on 13 military bases with plans to deploy the majority of its 58 domestic bases live with the Boingo Broadband service by year end. 
  • The Company announced it is in active discussions with multiple carriers to deploy small cell networks on military bases.

Management Commentary

"After a strong first half of the year, we reported another record quarter, and as a result, we are updating and raising our full year guidance," commented David Hagan, Chief Executive Officer of Boingo Wireless. "We extended our streak of double-digit revenue growth to 12 consecutive quarters and year-over-year adjusted EBITDA margin expansion to nine consecutive quarters. This growth is the result of consistent execution against our strategic plan to leverage explosive mobile data growth by obtaining long-term wireless rights at large venues, deploying DAS, Wi-Fi and small cell networks at those venues and monetizing the networks with Boingo's unique mix of products and services."

Mr. Hagan continued, "We are extremely pleased with our third quarter financial results which point to the strength of our overall business and the products and services driving the results. We believe Boingo is the largest provider of indoor DAS networks in the world and that both carrier offload and small cells will play an important role in boosting carrier coverage on military bases. It is exciting to see this become a reality."

Business Outlook

Boingo Wireless is raising its guidance for the full year ending December 31, 2017 as follows:
  • Revenue is expected to be in the range of $199.0 million to $203.0 million.
  • Net loss attributable to common stockholders is expected to be in the range of $(26.0) million to $(23.0) million, or a net loss of $(0.66) to $(0.58) per diluted share.
  • Adjusted EBITDA is expected to be in the range of $65.0 million to $68.0 million.

                                                                                                                                                                         Conference Call Information

Members of Boingo Wireless' management will host a conference call to discuss its third quarter 2017 financial results beginning at 4:30 p.m. ET (1:30 p.m. PT), today, November 2, 2017. To participate in the conference call, investors from the U.S. and Canada should dial (877) 407-9716 and enter the passcode: 13671090 ten minutes prior to the scheduled start time. International callers should dial +1 (201) 493-6779 and enter the same passcode. The conference call will be broadcast live over the Internet in the Investor Relations section of the Company's website at http://investors.boingo.com. In addition, a supplement reflecting the Company's key business metrics will be made available in the Investor Relations section of the Company's website. The supplement and webcast will be archived online upon completion of the conference call.

Use of Non-GAAP Financial Measures

To supplement Boingo Wireless' financial statements presented on a GAAP basis, Boingo Wireless provides Adjusted EBITDA and free cash flow as supplemental measures of its performance.

The Company defines Adjusted EBITDA as net loss attributable to common stockholders plus depreciation and amortization of property and equipment, stock-based compensation expense, amortization of intangible assets, income tax expense, interest and other expense, net, non-controlling interests, and excludes charges or gains that are nonrecurring, infrequent, or unusual. Boingo Wireless believes Adjusted EBITDA is useful to investors in evaluating its operating performance. Boingo's management uses Adjusted EBITDA in conjunction with accounting principles generally accepted in the United States, or GAAP, and other operating performance measures as part of its overall assessment of the Company's performance for planning purposes, including the preparation of its annual operating budget, to evaluate the effectiveness of its business strategies and to communicate with its board of directors concerning its financial performance. Adjusted EBITDA should not be considered as an alternative financial measure to net loss attributable to common stockholders, which is the most directly comparable financial measure calculated in accordance with GAAP, or any other measure of financial performance calculated in accordance with GAAP. Adjusted EBITDA for 2017 excludes settlement expense related to a claim from one of the Company's venue partners and Adjusted EBITDA for 2016 excludes charges related to the Company's contested proxy election for the 2016 annual meeting of stockholders because they represent non-recurring charges and are not indicative of the underlying performance of the Company's business operations.

The Company defines free cash flow as net cash provided by operating activities, less purchases of property and equipment. Boingo Wireless believes that free cash flow provides investors with additional useful information to measure operating liquidity because it reflects the amount of cash generated by the Company's operations after the purchases of property and equipment that can be used for strategic opportunities. Free cash flow should not be considered as an alternative financial measure to net cash provided by operating activities, which is the most directly comparable financial measure calculated in accordance with GAAP, or any other measure of financial performance calculated in accordance with GAAP.

About Boingo Wireless

Boingo Wireless, Inc. (NASDAQ:WIFI) helps the world stay connected. Our vast footprint of DAS, Wi-Fi and small cells reaches more than a billion people annually, making Boingo one of the largest providers of indoor wireless networks. You'll find Boingo connecting people at airports, stadiums, military bases, convention centers, and commercial properties. To learn more about the Boingo story, visit www.boingo.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains "forward-looking statements" that involves risks, uncertainties and assumptions. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects" and similar references to future periods. These forward-looking statements include the quotations from management in this press release, as well as any statements regarding Boingo's strategic plans, future guidance and future growth opportunities. Forward-looking statements are based on the Company's current expectations and assumptions regarding its business, the economy and other future conditions. Since forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. The Company's actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the Company's ability to maintain its existing relationships and establish new relationships with venue partners, its ability to complete build-outs and sign venue contracts, its ability to maintain revenue growth and achieve profitability, its ability to execute on its strategic and business plans, its ability to successfully compete with new technologies and adapt to changes in the wireless industry, as well as other risks and uncertainties described more fully in documents filed with or furnished to the Securities and Exchange Commission (SEC), including Boingo's Form 10-K for the year ended December 31, 2016 filed with the SEC on March 13, 2017, Form 10-Q for the quarter ended March 31, 2017 filed with the SEC on May 8, 2017 and Form 10-Q for the quarter ended June 30, 2017 filed with the SEC on August 4, 2017, which the Company incorporates by reference into this press release. Any forward-looking statement made by Boingo in this press release speaks only as of the date on which it is made. Factors or events that could cause the Company's actual results to differ may emerge from time to time, and it is not possible for Boingo to predict all of them. Boingo undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Boingo, Boingo Wireless, the Boingo Wireless Logo and Don't Just Go. Boingo. are registered trademarks of Boingo Wireless, Inc. All other trademarks are the properties of their respective owners.

Boingo Wireless, Inc. Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share amounts)
    Three Months Ended September 30,     Nine Months Ended September 30,  
    2017     2016     2017     2016  
                         
Revenue   $ 53,655     $ 40,796     $ 147,021     $ 114,370  
Costs and operating expenses:                        
Network access   24,143     17,982     64,655     49,575  
Network operations   11,625     10,698     34,556     31,566  
Development and technology   6,817     5,394     19,814     16,014  
Selling and marketing   5,201     4,553     15,188     14,103  
General and administrative   8,006     6,701     27,372     22,553  
Amortization of intangible assets   852     855     2,673     2,582  
Total costs and operating expenses   56,644     46,183     164,258     136,393  
Loss from operations   (2,989 )   (5,387 )   (17,237 )   (22,023 )
Interest and other expense, net   (84 )   (117 )   (126 )   (299 )
Loss before income taxes   (3,073 )   (5,504 )   (17,363 )   (22,322 )
Income tax expense   167     95     507     457  
Net loss   (3,240 )   (5,599 )   (17,870 )   (22,779 )
Net income attributable to non-controlling interests   210     110     477     180  
Net loss attributable to common stockholders   $ (3,450 )   $ (5,709 )   $ (18,347 )   $ (22,959 )
                         
Net loss per share attributable to common stockholders:                              
Basic   $ (0.09 )   $ (0.15 )   $ (0.46 )   $ (0.61 )
Diluted   $ (0.09 )   $ (0.15 )   $ (0.46 )   $ (0.61 )
                         
Weighted average shares used in computing net loss per share attributable to common stockholders:                        
Basic   40,336     38,189     39,468     37,897  
Diluted   40,336     38,189     39,468     37,897  
                         

Boingo Wireless, Inc. Condensed Consolidated Balance Sheets (Unaudited) (In thousands, except per share amounts)

    September 30, 2017     December 31, 2016  
Assets            
Current assets:            
Cash and cash equivalents   $ 21,634     $ 19,485  
Accounts receivable, net   39,102     42,978  
Prepaid expenses and other current assets   6,722     5,344  
Total current assets   67,458     67,807  
Property and equipment, net   261,010     250,765  
Goodwill   42,403     42,403  
Intangible assets, net   11,094     13,783  
Other assets   6,580     6,223  
Total assets   $ 388,545     $ 380,981  
             
Liabilities and stockholders' equity            
Current liabilities:            
Accounts payable   $ 14,614     $ 15,516  
Accrued expenses and other liabilities   35,660     27,723  
Deferred revenue   78,575     50,869  
Current portion of long-term debt   875     1,094  
Current portion of capital leases and notes payable   4,349     3,993  
Total current liabilities   134,073     99,195  
Deferred revenue, net of current portion   138,910     152,719  
Long-term debt   5,219     15,875  
Long-term portion of capital leases and notes payable   3,560     4,612  
Deferred tax liabilities   3,513     3,208  
Other liabilities   6,500     6,826  
Total liabilities   291,775     282,435  
             
Commitments and contingencies            
             
Stockholders' equity:              
Preferred stock, $0.0001 par value; 5,000 shares authorized; no shares issued and outstanding        
Common stock, $0.0001 par value; 100,000 shares authorized; 40,788 and 38,562 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively   4     4  
Additional paid-in capital   227,454     211,275  
Accumulated deficit   (130,948 )   (112,601 )
Accumulated other comprehensive loss   (812 )   (870 )
Total common stockholders' equity   95,698     97,808  
Non-controlling interests   1,072     738  
Total stockholders' equity   96,770     98,546  
Total liabilities and stockholders' equity   $ 388,545     $ 380,981  
 

Boingo Wireless, Inc. Condensed Consolidated Statements of Cash Flows  (Unaudited) (In thousands)

    Nine Months Ended September 30,  
    2017     2016  
Cash flows from operating activities            
Net loss   $ (17,870 )   $ (22,779 )
Adjustments to reconcile net loss including non-controlling interests to net cash provided by operating activities:            
Depreciation and amortization of property and equipment   49,244     34,801  
Amortization of intangible assets   2,673     2,582  
Bad debt expense (recovery)   88     (47 )
Other   51      
Impairment loss and loss on disposal of fixed assets, net   442       49  
Stock-based compensation   11,016     9,690  
Change in deferred income taxes   305     324  
Changes in operating assets and liabilities:            
Accounts receivable   3,804     (462 )
Prepaid expenses and other assets   (1,816 )   (2,182 )
Accounts payable   (1,330 )   3,464  
Accrued expenses and other liabilities   6,920     4,018  
Deferred revenue   13,897     64,140  
Net cash provided by operating activities   67,424     93,598  
Cash flows from investing activities            
Purchases of property and equipment   (54,691 )   (92,045 )
Payments for asset acquisition   (1,150 )    
Net cash used in investing activities   (55,841 )   (92,045 )
Cash flows from financing activities            
Proceeds from credit facility       5,000  
Principal payments on credit facility   (10,875 )   (5,656 )
Proceeds from exercise of stock options   7,993     1,981  
Debt issuance costs       (124 )
Payments of capital leases and notes payable   (2,952 )   (1,889 )
Payments of withholding tax on net issuance of restricted stock units   (3,480 )   (2,112 )
Payments to non-controlling interests   (125 )   (286 )
Net cash used in financing activities   (9,439 )   (3,086 )
Effect of exchange rates on cash   5     15  
Net increase (decrease) in cash and cash equivalents   2,149     (1,518 )
Cash and cash equivalents at beginning of period   19,485     14,718  
Cash and cash equivalents at end of period   $ 21,634     $ 13,200  
Supplemental disclosure of non-cash investing and financing activities            
Property and equipment costs in accounts payable, accrued expenses and other liabilities   $ 19,438     $ 19,367  
Purchase of equipment and prepaid maintenance services under capital financing arrangements   $ 2,141     $ 4,560  
                 

Boingo Wireless, Inc. Reconciliation of Net Loss Attributable to Common Stockholders to Adjusted EBITDA  (Unaudited) (In thousands)

    Three Months Ended September 30,       Nine Months Ended September 30,  
    2017     2016     2017     2016  
                         
Net loss attributable to common stockholders   $ (3,450 )   $ (5,709 )   $ (18,347 )   $ (22,959 )
Depreciation and amortization of property and equipment    18,245     13,093     49,244     34,801  
Stock-based compensation expense   3,684     3,006     11,016     9,690  
Amortization of intangible assets   852     855     2,673     2,582  
Income tax expense   167     95     507     457  
Interest and other expense, net   84     117     126     299  
Non-controlling interests   210     110     477     180  
Contested proxy election expense               1,440  
Settlement expense           2,807      
Adjusted EBITDA   $ 19,792     $ 11,567     $ 48,503     $ 26,490  
   

Boingo Wireless, Inc. Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flows  (Unaudited) (In thousands)

  Three Months Ended September 30,   Nine Months Ended September 30,
    2017       2016         2017       2016  
Net cash provided by operating activities $ 20,071     $ 37,931     $ 67,424     $ 93,598  
Purchases of property and equipment, net   (22,774 )     (27,788 )     (54,691 )     (92,045 )
Free cash flows $ (2,703 )   $ 10,143     $ 12,733     $ 1,553  
         

Boingo Wireless, Inc. Revenue Summary (Unaudited) (In thousands)

    Three Months Ended September 30,   Nine Months Ended September 30,  
    2017   2016   2017   2016  
Revenue:                  
DAS   $ 21,755   $ 15,959   $ 56,563   $ 40,957  
Military                     13,946   10,137   40,029   28,969  
Wholesale—Wi-Fi   8,307   5,888   22,438   16,031  
Retail   6,234   6,619   19,007   20,100  
Advertising and other   3,413   2,193   8,984   8,313  
Total revenue   $ 53,655   $ 40,796   $ 147,021   $ 114,370  
   

Boingo Wireless, Inc. Reconciliation of Net Loss Attributable to Common Stockholders to Adjusted EBITDA - Guidance  (Unaudited)                                                                                                 (In millions)                          

    Year Ended December 31, 2017  
    Low   High  
                       
Net loss attributable to common stockholders   $ (26.0 ) $ (23.0 )
Depreciation and amortization of property and equipment..   68.9  
Stock-based compensation expense   14.2  
Amortization of intangible assets   3.6  
Income tax expense and interest and other expense, net   0.8  
Non-controlling interests   0.7  
Settlement expense   2.8  
Adjusted EBITDA   $ 65.0   $ 68.0  
   

Boingo Wireless, Inc. Key Business Metrics (Unaudited) (In thousands)

    Three Months Ended September 30, Nine Months Ended September 30,
    2017   2016   2017   2016
Key business metrics:                
DAS nodes(1)               22.2   17.7   22.2   17.7
DAS nodes in backlog(2)   11.0   5.2   11.0   5.2
Subscribers—military(3)   133   86   133   86
Subscribers—retail(3)   194   185   194   185
Connects(4)   64,875   40,263   160,082   102,515
  1. This metric represents the number of active DAS nodes as of the end of the period. A DAS node is a single communications endpoint, typically an antenna, which transmits or receives radio frequency signals wirelessly. This measure is an indicator of the reach of the Company's DAS network.
  2. This metric represents the number of DAS nodes under contract but not yet active as of the end of the period.
  3. This metric represents the number of paying customers who are on a month-to-month subscription plan at a given period end.
  4. This metric shows how often individuals connect to the Company's global Wi-Fi network in a given period. The connects include retail and wholesale customers in both customer pay locations and customer free locations where Boingo is a paid service provider or receives revenue sponsorship or promotion fees. The Company counts each connect as a single connect regardless of how many times that individual accesses the network at a given venue during their 24 hour period. This measure is an indicator of paid activity throughout Boingo's network.

CONTACTS: PRESS: Lauren de la FuenteVice President, Marketing and Communications ldelafuente@boingo.com(310) 405-8517

INVESTORS: Kimberly Orlando and Ariel PapermasterADDO Investor Relations investors@boingo.com (310) 829-5400