Boingo Wireless Supported By Military, Forecast Reduced At Credit Suisse

In a report published Friday, Credit Suisse analysts maintained an Outperform rating on

, with a price target of $9. Boingo Wireless reported its 1Q15 results ahead of the guidance. The company announced revenue and adjusted EBITDA of $29.4 million and $3.2 million, higher than its guidance of $26.5-$28.5 million and $1-$2.5 million, respectively. "Boingo reported a top and bottom line beat as military revenue drove the upside to guidance and CS estimates adding 12k new military subscribers in 1Q15 and 7k beds came online. The military revenue outperformance resulted in higher gross margin on positive mix," the analysts mentioned. Boingo currently offers its Wi-Fi services to 137k beds and expects another ~100k beds to come online in FY15. The company guided to 2Q15 revenue and adjusted EBITDA of $30.5-$32.5 million and $5-$6.5 million, respectively, while reiterating its FY15 revenue and adjusted EBITDA guidance of $134m-$140m and $27m-$30m, respectively. Boingo's advertising revenues declined y/y from a tough comp in 1Q14. "We expect more meaningful contribution from carrier offload in FY15 and beyond as Boingo is now in-market with 40 million handsets and Boingo access points. Consistent with the results, we have moderated our trajectory for Advertising Revenue while increasing the decay rate for the retail subscription business on a go-forward basis," the analysts stated. The adjusted EBIDA estimate for 2015 has been reduced from $27.8 million to $27.2 million.