Telesat (TSAT) Q1 2025 earnings summary

Executive summary

• Strong Q1 performance in both GEO and LEO segments, with disciplined execution in GEO and significant commercial progress in LEO, including major multi-year agreements with Viasat, Orange, Space Norway, and ADN Telecom, supporting future LEO growth.

• LEO backlog is nearly CAD 1.1 billion, with expectations to surpass GEO backlog by year-end, driven by new deals and strong market momentum.

• Revenue for Q1 2025 was $117 million, down $25 million or 23.3% year-over-year; net loss was $51.5 million, nearly flat year-over-year, mainly due to positive FX variation offset by lower revenues and derivative losses tied to Lightspeed Financing.

Financial highlights

• Q1 2025 consolidated revenues were $117 million, down 23.3% year-over-year; adjusted EBITDA was $67.4 million (57.7% margin), down from $110.7 million (72.8% margin) in Q1 2024.

• Operating expenses increased by $6 million to $53 million, mainly due to Lightspeed headcount, higher legal/professional fees, and software costs.

• Interest expense decreased by $8 million to $56.7 million, reflecting lower debt balances and rates, offset by new Lightspeed Financing interest.

• Cash from operations was $139 million; quarter-end cash balance was $797 million.

• Amortization rose to $10.9 million due to a change in accounting for GEO orbital slots from indefinite to finite life assets.

Outlook and guidance

• 2025 full-year revenue guidance reiterated at $405–$425 million, assuming CAD/USD exchange rate of 1.42.

• Adjusted EBITDA expected between CAD 170–190 million; Lightspeed operating expenses (excluding share-based comp) projected at $110–$120 million, up from $72 million in 2024.

• Capital expenditures for 2025 expected at CAD 900 million–1.1 billion, almost entirely for Lightspeed.

• Cash, short-term investments, and available Lightspeed Financing are expected to cover operational and capital needs for at least the next 12 months.