Updated Jan. 11, 2019 at 2:05 p.m. Eastern with the correct manufacturer for Iridium’s first-generation satellites.

WASHINGTON — Iridium Communications had what Chief Financial Officer Thomas Fitzpatrick called its “best quarterly revenue growth in company history,” logging $135 million for April, May and June, an increase of 21 percent over the same time last year.

With seven of eight launches completed for Iridium Next, its $3 billion second-generation constellation, Iridium is poised to begin a 10-year “capex holiday,” CEO Matt Desch said during a call with investors, projecting a reduction to $35 million in annual spending after the final launch.

McLean, Virginia-based Iridium spent $132 million in capital expenditures the past three months, most of it on Iridium Next.

Higher than expected sales of satellite phones and other equipment boosted revenue, along with the beginning of hosting fees from aircraft tracking startup Aireon, whose sensors are attached to the Iridium Next fleet.

Iridium executives did not give a date for the final Iridium Next launch, which like all the others will use a SpaceX Falcon 9 rocket, but reiterated that Iridium is on track to complete the full constellation of 75 in-orbit satellites this year.

“We are getting close to arriving at what some of you have heard me call the land of milk and honey, that valley beyond the mountain we’ve been scaling which will reward all our hard work,” Desch said July 31. “We are not taking victory laps yet, but our business is very strong and our prospects have never looked better.”

Desch said 80 percent of Iridium’s telecom traffic is traveling over Next satellites, of which 65 are in orbit. The newest 10 satellites, launched July 25 from Vandenberg Air Force Base in California, will start operation over the course of August and early September, he said.

The full Iridium Next constellation consists of 66 operational satellites, nine orbiting spares and six ground spares. European manufacturer Thales Alenia Space built the satellites, integrating them at Northrop Grumman Innovation Systems’ Gilbert, Arizona facility.

Iridium’s first-generation constellation from Motorola and Lockheed Martin has been in service for around 20 years, roughly triple its design life. As Iridium continues to gradually deorbit the older spacecraft, Desch said the new Next satellites provide a solid base on which to grow for the next decade.

“I know the history of other satellite operators regarding capex holidays isn’t so good, but our motivations are very different,” he said. “Our network is very flexible, and our new satellites have been designed to support the growth and market opportunities we see in the future.”

One of the biggest such opportunities is the growing inclusion of sensors and other devices beyond phones and computers on the internet, often referred to as the Internet of Things.

“We are riding a bow wave of the internet of people becoming the Internet of Things,” Fitzpatrick said, noting that Iridium’s legacy voice and data business, though slow-growing, remains “highly defensible” from the company’s incumbent position.

“That’s why we’re putting up subscriber gains of 25 percent, and we don’t think there is an end in sight, at least if you read reports about the Internet of Things and its proliferation,” he said.

Iridium subscribers totaled 1,047,000 at the end of June, up 15 percent year over year, with commercial IoT subscribers counting for 576,000, up 25 percent from the same time in 2017.

Fitzpatrick said Iridium has raised prices for some subscription plans that reflect the improved throughput and service quality of Iridium Next.

One revenue stream Iridium is still working to confirm is what will follow a five-year, $400 million contract with the U.S. Defense Information Systems Agency that expires in October. Desch said he anticipates DISA will choose a six month contract extension, allowing for more time to negotiate a follow-on contract.

Desch declined to describe pricing for the new contract Iridium is working on, but hinted that Iridium is pitching Certus, its new higher throughput broadband offering, to the government in addition to traditional services of secure voice, push to talk, and IoT narrowband connectivity. He said Certus should launch this year, and that Iridium projects $100 million in annual revenue from those products by the end of 2021.

“Longer term our strategy is to encourage more partners to embed Iridium Certus core IP directly into their solutions,” he said. “We’ve been working over the last few years to attract larger companies to license our core chipsets and reference designs to build their own customized transceivers and integrate Iridium more deeply into their product portfolios.”

Desch estimated the L-band broadband communications market, where Iridium competes alongside London-based Inmarsat, Thuraya of the UAE, and, to a lesser extent, Globalstar of Covington, Louisiana, to be worth more than $700 million annually.