Viasat (VSAT) Q2 2025 earnings summary

Executive summary

• Q2 FY2025 results exceeded expectations, driven by strong performance in defense, advanced technologies, aviation connectivity, and government satcom, with robust IP licensing in tactical networking.

• Record new contract awards reached up to $1.3 billion, led by defense and advanced technologies, particularly in cybersecurity, ground systems, and space and mission systems, with backlog at $3.75 billion.

• Net loss attributable to Viasat, Inc. improved to $137.6 million from $767 million a year ago, which included a significant impairment charge.

• Ongoing strategic initiatives include strengthening the capital structure, reducing capital intensity, leveraging satellite capacity, and maximizing value from the business portfolio.

• The Inmarsat Acquisition continues to contribute to service revenue growth, particularly in the communication services segment.

Financial highlights

• Q2 FY2025 revenue was $1.13 billion, down 1% year-over-year, with aviation and government satcom growth offsetting declines in fixed broadband and maritime.

• Adjusted EBITDA was $375 million, down 6% year-over-year; margin was 33%.

• Net loss improved to $137.6 million, or $(1.07) per share, compared to $(6.16) per share last year.

• Capital expenditures declined 37% year-over-year to $229 million, mainly due to lower satellite spending.

• Operating cash flow for the first six months was $390.3 million, up from $322.6 million year-over-year.

Outlook and guidance

• Fiscal 2025 outlook is maintained: revenue expected to be flat to slightly up year-over-year, with mid-single-digit adjusted EBITDA growth and improved capex guidance of $1.3–$1.4 billion.

• Communications Services revenue is expected to be slightly down, while DAT revenue is projected to grow low-teens percent.

• Fiscal 2026 is expected to see year-over-year revenue and adjusted EBITDA growth, with cash flow through FY26 remaining net neutral.