Eutelsat Communications don release im full year results, and tings no too bright. Di company stock don chop serious knock, falling about 28% for three months, and e close at €2.04 on di day of di release. Expectations bin dey low, but di real story na di size of losses and di expensive move to low Earth orbit capacity.
Revenue for di year bin reach about €1.236 billion, but Eutelsat still report loss of €457 million. Di adjusted EBITDA margin na 51.2%. Di market now need to decide weda dat margin and di LEO growth fit justify di ongoing cash and balance sheet strain. Eutelsat dey trade as bargain, but losses dey mount and dilution dey bite.
Bulls dey argue say Eutelsat fit turn LEO into growth engine wey government demand go drive. Di latest results show concrete milestones. LEO revenue reach about €297 million, wey now be roughly 25% of group revenue, wit strong contributions across Fixed, Mobile and Government connectivity. Di GEO to LEO mix shift dey progress beyond plan on paper.
Di bullish story also depend on sovereign contracts and backlog quality. Eutelsat hit important markers. Di French CENTAURE contract under di NEXUS framework bring firm revenue of €138 million over di first 4 years, wit potential to reach €350 million over 8 years. Leadership for di EU IRIS² programme and a €3.4 billion backlog, where Connectivity now dey at 61%, support di view say government and enterprise customers dey start to commit real volume to LEO platform.
But di core worry na say OneWeb integration and LEO expansion go keep cash flow under strain while legacy Video dey erode. Dis results no dismiss dat concern. Group revenue roughly flat, and Video fall 13.1% to €519 million. Di drag from older business dey clear. LEO revenue of €297 million and backlog of €3.4 billion help, but dem no yet big enough to offset loss of €457 million and 3.2 percentage point squeeze for adjusted EBITDA margin to 51.2%.
Bears dey warn about heavy capex cycle. Management confirm about €4 billion capex for FY26 to FY29, and guide to about €1.2 billion in FY27 alone. Di recent €5 billion refinancing and equity raise reduce immediate funding risk, but dem also show how capital hungry dis transition still be.
