Company expected to achieve $100 million in annual expense savings as a
result of ongoing Inmarsat integration
CARLSBAD, Calif., Nov. 2, 2023
/PRNewswire/ -- Viasat Inc. (NASDAQ: VSAT), a global
communications company, today announced that it has reached an
important milestone in its integration program following the
acquisition of Inmarsat. As part of its ongoing strategy to
streamline operations and to better serve its growing customer
base, Viasat has completed a rationalization of roles in its global
business, to achieve both operational and cost efficiencies.
"Since we completed the acquisition of Inmarsat, our focus has
been on accelerating our leading role in global mobile satellite
communications by converging our technologies and organizational
structures to deliver enhanced products and services to our
customers. We will continue working to better unify our
go-to-market approach, and maximize operational and capital
productivity," said Guru Gowrappan, president of Viasat.
As a result of the role rationalization, Viasat will reduce its
global workforce by approximately 800 roles, or about 10%, spread
across the business in terms of geographies and divisions. This
move is expected to result in annualized run-rate operating expense
cost savings of approximately $100
million beginning primarily in FY2025. Separately, this
reduction will also contribute to the attainment of the Company's
FY2025 capital expenditure target of $1.4
billion to $1.5 billion,
including capitalized interest. The Company will incur charges of
approximately $45 million to achieve
these synergies, which will be incurred predominantly in the second
half of FY2024.
"The changes we are announcing today are consistent with our
goals to focus our spending toward our biggest growth opportunities
and position Viasat for long-term success, while expanding margins
and profitability," said Guru. "At the same time, the decision to
reduce our workforce is a very difficult one, and not something we
take lightly. We would like to express our gratitude to our
departing colleagues for their dedication, hard work, and
contributions, which have been integral to Viasat's success story,"
continued Guru.
Viasat confirmed that today's actions enable the company to
focus ongoing investments in space and ground technologies and
assets that support customers' needs and the company's growth
targets for revenue and AEBITDA in FY2024, FY2025, and beyond
through increasing emphasis on global mobility across commercial
and government markets. The cost reductions support improvements in
operating results and reductions in capital spending that are
consistent with previously announced plans to reduce debt and
leverage and generate free cash flow by the first half of
CY2025.
The Company emphasized that following these actions, Viasat
continues to operate with a global footprint, with a majority of
its employees continuing to be located in the United States and the UK.
Further details are expected to be shared at Viasat's Q2
earnings on November 8, 2023.
Forward-Looking Statements
This press release contains forward-looking statements that are
subject to the safe harbors created under the Securities Act of
1933 and the Securities Exchange Act of 1934. Forward-looking
statements include, among others, statements that refer to
anticipated cost savings and realization of synergies and the
timing thereof, the proposed workforce reduction and the amount and
timing of associated costs, and expectations for future
performance, reductions in capital and operating expenses, free
cash flow generation, profitability, growth and results of
operations. Readers are cautioned that actual results could differ
materially and adversely from those expressed in any
forward-looking statements. Factors that could cause actual results
to differ include: risks associated with the construction, launch
and operation of satellites, including the effect of any anomaly,
operational failure or degradation in satellite performance; the
ability of Viasat to successfully integrate Inmarsat operations,
technologies and employees following the closing of the Inmarsat
acquisition; the ability to realize anticipated benefits and
synergies of the Inmarsat acquisition, including the expectation of
enhancements to Viasat's products and services, greater revenue or
growth opportunities, operating efficiencies and cost savings; the
ability to ensure continued performance and market growth of
Viasat's business; changes in the global business environment and
economic conditions; the availability and cost of credit; Viasat's
ability to successfully develop, introduce and sell new
technologies, products and services; Viasat's reliance on a limited
number of third parties to manufacture and supply its products; the
risk of litigation or regulatory actions; Viasat's level of
indebtedness and ability to comply with applicable debt covenants;
and other factors affecting the communications industry generally.
In addition, please refer to the risk factors contained in Viasat's
SEC filings available at www.sec.gov, including Viasat's most
recent Annual Report on Form 10-K and Quarterly Reports on Form
10-Q. Readers are cautioned not to place undue reliance on any
forward-looking statements, which speak only as of the date on
which they are made. Viasat undertakes no obligation to update or
revise any forward-looking statements for any reason.
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SOURCE Viasat, Inc.