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Investing.com -- Gogo (NASDAQ:GOGO) stock rose 8% in pre-open trading Wednesday after the company announced a significant milestone in its 5G network development, confirming the first successful end-to-end call using its next-generation technology.
The call, which took place on June 16, validates that the Gogo 5G chip developed by GCT Semiconductor (NYSE:GCTS) is fully functional and ready to move through final integration phases. This represents a critical step toward delivering 5G air-to-ground connectivity to North American business aviation operators by year-end.
GCT Semiconductor delivered the microchip to Airspan, Gogo’s 5G partner, in May. The successful integration of the chip into hardware and software allowed for the configuration and support of the end-to-end call in a laboratory setting, confirming the technology is ready for the next phase of testing.
"We expect Gogo shares to trade higher today after the company announced that a significant milestone in its 5G network development had been achieved," said William Blair analyst Louie DiPalma, who maintains an Outperform rating on the stock.
The company has already received Federal Aviation Administration approval to produce its AVANCE LX5 Line Replaceable Unit and has invested in a network of 170 5G towers covering the U.S. and parts of Canada. More than 300 aircraft are currently pre-provisioned for Gogo’s 5G connectivity.
Gogo CEO Chris Moore called the successful chip validation "a major achievement" and expressed confidence in delivering 5G connectivity to customers by the end of the year.
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