Spok Holdings Reports $137.7M Revenue for Fiscal Year 2024, Wireless Revenue Declines

Spok Holdings, Inc. reported a total revenue of $137.7 million for the fiscal year ending December 31, 2024, reflecting a slight decrease of 1% compared to $139 million in 2023. The company's wireless revenue, which includes messaging services, decreased by 3.2% to $73.5 million, while software revenue increased by 1.7% to $64.1 million. The decline in wireless revenue is attributed to a continued decrease in the number of units in service, which fell from approximately 765,000 to 720,000. Despite this, the average revenue per user (ARPU) increased to $7.97 from $7.71, partially offsetting the revenue decline.

In terms of profitability, Spok's net income for 2024 was $15 million, down 4.5% from $15.7 million in the previous year. Operating income also decreased by 10.7% to $19 million, influenced by rising operating expenses, which totaled $118.7 million, an increase of 10.8% from 2023. The increase in expenses was primarily driven by higher costs associated with professional services personnel and research and development efforts aimed at enhancing software solutions.

Strategically, Spok has focused on optimizing its existing business lines, particularly the Spok Care Connect suite and wireless services, following a restructuring plan initiated in February 2022. The company discontinued its Spok Go product line to streamline operations and reduce costs. Additionally, Spok has been investing in the development of its GenA pager, which features advanced encryption and a high-resolution display, aiming to mitigate the decline in wireless revenue by offering differentiated products.

Operationally, Spok's workforce increased to 410 full-time equivalent employees, up from 384 in 2023, reflecting the company's efforts to align staffing levels with its operational needs. The number of active transmitters decreased to 3,048, down from 3,215, as part of the company's network rationalization strategy aimed at improving efficiency and reducing costs. Looking ahead, Spok anticipates continued challenges in its wireless segment due to market competition and technological advancements, but remains committed to enhancing its software offerings and maintaining cash flow generation to support shareholder returns through dividends. The company declared a quarterly dividend of $0.3125 per share, expected to be paid in March 2025.