Viasat, Inc. Q3 FY2026 earnings call

Management Statement and Operational Highlights

• Recent Results and Accomplishments: FY '26 revenue and EBITDA consistent with expectations. Cash generation better than planned due to efficient cash conversion, strategic transactions, and spending efficiencies. ViaSat-3 Flight 2 launched, near completion, Flight 3 in final integration. Multi-orbit progress with maritime NexusWave growth. New defense tech in DAT and government SATCOM.
• Impacts and Outlook: ViaSat-3 Flight 2 and 3 expected to drive growth in mobility and fixed services. Multi-orbit investments in user terminals and LEO bandwidth. Strategic themes: capital allocation to unlock value, positioning in space and defense markets.
• Macro Market Factors: Global space economy growth, geopolitical and technology forces impacting space and ground infrastructure. ViaSat's position in state-of-the-art tech, policy solutions, and spectrum/orbital resources.

Segment Performance

• Communication Services: Awards were $671 million, down 11%. Revenue was $825 million, up 1%. Aviation revenue grew 15%, government SATCOM grew 4%, maritime revenue declined 3%, fixed services and other down 20%. Adjusted EBITDA was $319 million, down 3%.
• Defense & Advanced Technologies: Awards $300 million, down 8%. Revenue $332 million, up 9%. Infosec and cyber defense up 8%, tactical networking up 20%. Adjusted EBITDA $68 million, up 7%.

Guidance

• Fiscal '26 revenue expected low single digits, flat adjusted EBITDA. Free cash flow positive for '26, '27, and beyond. CapEx revised to $100 million to $200 million lower than prior guidance, with $40 million to continue into fiscal '27 from ViaSat-3 spend.
• Equatys venture ongoing, consistent with financial mantra of growing franchises, cash flow, and deleveraging.

Risks

• Uncertainties in macro market factors, including geopolitical, economic, and technology forces. Delays in satellite deployments or regulatory approvals. Competition in space and defense markets.

Question and Answer

Q: On Flight 2, 3 launches and service, and strategic review A: Flight 2 in May, Flight 3 with 2-month orbit raise. Strategic review considers Flight 2/3 success, macro conditions, delevering, and free cash flow Q: Data centers in space and AI with space A: Hinges on power generation and heat dissipation in space. ViaSat interested in related tech for communication satellites Q: Fast-growing segments and competitive advantages A: Broadband (Ka-band) and mobility markets, especially L-band with small terminals and D2D interoperability Q: IFC and Telesat Lightspeed Constellation A: Using GEO and LEO for maritime-like multi-orbit in aero, single antenna for LEO/GEO simultaneous operation Q: Revenue inflection for Comp Services after F2, F3 A: Expect growth in maritime, government services; residential to slow decline and then grow Q: Government assets evaluation and separation A: Evaluating capital structure, competitive position, and shareholder value Q: Quantum resistant cryptography and competition A: Good growth, competitive position improved due to urgency and market size Q: Space data centers and spectrum limitations A: Migration to higher RF bands, optical links possible for data centers Q: Micro/mini GEO satellites A: Developing smaller, cheaper satellites to drive down capital intensity and improve return on capital Q: Strategic review and defense prime IPO A: Interest in government equity investment and international opportunities Q: Revised CapEx outlook A: $40 million push to '27, rest efficiency-driven