Telesat (TSAT) Q4 2025 earnings summary

Executive summary

• Achieved results ahead of adjusted EBITDA guidance for 2025, optimizing cost structure in a fixed-cost GEO business.

• Revenue declined 27% year-over-year to $418 million, mainly due to rate and capacity reductions by North American DTH and enterprise customers.

• Significant progress on the Lightspeed LEO network, with over $770 million invested in 2025 and first satellites launching end of 2026; full global service expected by end of Q1 2028, delayed by three months due to ASIC chip readiness.

• Lightspeed optimized for defense, dedicating 500 MHz (25%) of capacity to military Ka-band (Mil-Ka), with minimal cost and no schedule impact.

• Strong demand from government and defense sectors, with contracts and MOUs in place with Canada, the US, and Korea, including a U.S. Department of War contract.

Financial highlights

• 2025 revenue: $418 million; adjusted EBITDA: $213 million; cash on hand: $510 million.

• Q4 2025 revenue: $94 million; adjusted EBITDA: $40 million.

• Net loss for 2025: $530 million, up from $302 million in 2024, mainly due to lower revenue, goodwill impairment, and derivative liability increase.

• Interest expense for 2025: $218 million, down from $240 million in 2024 and $270 million in 2023.

• Capital expenditures in 2025: $708 million, mostly for Lightspeed, below guidance due to milestone payment deferral.

Outlook and guidance

• 2026 GEO revenue expected between $300–320 million, a decline of $90–110 million year-over-year.

• GEO adjusted EBITDA for 2026 projected at $210–230 million, excluding refinancing and non-recurring costs.

• LEO segment investment in 2026 expected at $1–1.2 billion, including OpEx, capitalized labor, and interest.

• Sufficient liquidity to meet obligations before Telesat Canada debt matures in December 2026.