Viasat Q4 Earnings Call Highlights

Key Points

• Viasat posted fiscal 2026 revenue of $4.6 billion, positive free cash flow of $597 million, and record backlog/new contract awards, while noting results were broadly in line with expectations despite government shutdown headwinds.
• The company’s fourth quarter showed strength in aviation, government SATCOM and defense technology: awards rose 9% to about $1.3 billion, backlog climbed 15% to roughly $4.1 billion, and DAT revenue increased 12% year over year.
• Looking ahead, Viasat expects mid-single-digit revenue growth in fiscal 2027, supported by ViaSat-3 launches and the Equitas shared infrastructure venture, while maintaining similar free cash flow levels excluding the Ligado payment.

Viasat NASDAQ: VSAT reported record backlog, modest revenue growth and positive free cash flow for fiscal 2026, while executives said the satellite communications company is positioning for growth from new satellite capacity, defense technology programs and a planned shared space infrastructure venture.

On the company’s fourth-quarter earnings call, Chairman and CEO Mark Dankberg said fiscal 2026 results were “largely consistent” with Viasat’s expectations despite headwinds from a U.S. government shutdown in the second half of the fiscal year. He highlighted record new contract awards and backlog, record revenue and adjusted EBITDA, and “nearly $600 million in free cash flow,” including a lump-sum Ligado payment.

Chief Financial Officer Gary Chase said Viasat generated fiscal 2026 revenue of $4.6 billion, a GAAP net loss of $34 million and adjusted EBITDA of $1.55 billion. Cash flow from operations was $1.6 billion, or $1.2 billion excluding the Ligado payment, while capital expenditures were just under $1 billion. Free cash flow was $597 million, or $177 million excluding the Ligado payment.

“From a cash flow point of view, our teams delivered in a big way,” Chase said, adding that Viasat produced positive free cash flow in each of the last five quarters.

Fourth-quarter awards and backlog rise

For the fiscal fourth quarter, Chase said awards were about $1.3 billion, up 9% from the prior-year period, led by communication services growth in maritime, government SATCOM and aviation. Backlog reached approximately $4.1 billion, up 15%, with double-digit growth in both communication services and defense and advanced technologies, or DAT.

Quarterly revenue was $1.2 billion, up about 2%, as 12% growth in DAT was partially offset by a 2% decline in communication services. Net income was $59 million, an improvement of $305 million, which Chase attributed mainly to a gain from the sale of Viasat’s equity investment in Navarino, lower general and administrative expense and lower interest expense. Adjusted EBITDA was $370 million, down 1%, reflecting incremental research and development spending and a higher-than-expected effect from the government shutdown.

Viasat completed the divestiture of its interest in Navarino in March, receiving gross proceeds of $203 million. Chase said net debt to trailing adjusted EBITDA improved to 3.1 times, and the company paid down $743 million of debt during the year while increasing available cash.

Segment trends show aviation and DAT strength

In communication services, quarterly awards increased 13% to $877 million, while revenue fell 2% to $810 million. Chase said aviation revenue rose 11%, with approximately 4,450 commercial aircraft in service at quarter-end, up 10% year over year, along with higher average revenue per aircraft. Viasat ended the quarter with a commercial aircraft unit backlog of 1,000.

Government SATCOM revenue grew 5%, supported by U.S. and international government demand. Government awards and backlog rose 18% year over year. Maritime revenue declined 1%, as vessels in service were down, though Chase said demand for NexusWave remained strong. Viasat ended the quarter with about 1,350 NexusWave vessels in service and 1,500 more in backlog.

Fixed services and other revenue declined 24% as U.S. fixed broadband subscribers continued to fall. Viasat ended the quarter with 130,000 subscribers and average revenue per user of $113.

In DAT, quarterly awards increased 2% to $403 million, driven by growth in information security and cyber defense. Revenue rose 12% to $361 million, including 24% growth in information security and cyber product revenue and 16% growth in space and mission systems. DAT adjusted EBITDA increased 20% to $83 million.

Fiscal 2027 outlook calls for mid-single-digit revenue growth

For fiscal 2027, Chase said Viasat expects revenue to grow in the mid-single digits, with low-single-digit growth in communication services and mid-teens growth in DAT. Adjusted EBITDA is expected to be flat to up slightly and weighted toward the back half of the year.

Chase said EBITDA comparisons will be affected by a declining contribution from an intellectual property settlement in advanced technologies and other business, along with the removal of Navarino EBITDA following the sale. Together, those items represent about a two-percentage-point headwind versus fiscal 2026.

Viasat expects reported capital expenditures of $950 million to $1 billion in fiscal 2027, including about $850 million of cash CapEx. The company expects free cash flow to be similar to fiscal 2026 levels excluding Ligado, or about $180 million.

Within communication services, Chase said aviation revenue should grow as average revenue per aircraft increases, though at a moderating rate. Maritime vessels are expected to decline modestly, but the NexusWave installed base is expected to grow significantly. Fixed broadband is expected to continue declining until ViaSat-3 enters service, after which Viasat expects stabilization. Government SATCOM is expected to grow again.

ViaSat-3 launches and Equitas plans remain central

Dankberg said Viasat successfully completed all deployments on ViaSat-3 Flight 2 after quarter-end, with service entry pending FCC authorization. ViaSat-3 Flight 3 launched successfully on April 29, with radiator and solar array deployments completed and orbit raising underway. Flight 3 is expected to cover the Asia-Pacific region, arrive on station in about a month and enter service in August or September.

Dankberg said the fleet expansion is expected to roughly triple bandwidth inventory and support growth in aviation, maritime, fixed services and government SATCOM.

Executives also discussed Equitas, a shared multi-tenant, multi-orbit L- and S-band infrastructure entity being formed with Space42. Dankberg described Equitas as similar to terrestrial shared tower infrastructure, allowing multiple spectrum holders to use common space and ground infrastructure. He said Viasat expects to participate as the initial technology prime contractor and is targeting services in 2029.

In response to analyst questions, Dankberg said Viasat is not contributing spectrum to Equitas but could use its spectrum through the infrastructure. He said the company expects to provide more details on Equitas after finalizing related agreements.

Defense opportunities and strategic review

Dankberg said Viasat recently received a follow-on award tied to the Protected Tactical SATCOM-Global program, or PTSG, for delivery of a small, low-cost, maneuverable dual-band geosynchronous orbit U.S. government tactical satellite. He described PTSG as an opportunity to expand Viasat’s role in government tactical space systems and services.

Asked about the strategic review of the DAT business and the potential for a spin-off, Dankberg said the core question is whether DAT is an “appreciating asset.” He said Viasat sees value in keeping dual-use technology and services together for now, particularly in areas such as PTSG, while retaining optionality.

Viasat also announced board additions during the call. Dankberg welcomed Shekar Ayyar and Jinhy Yoon, both of whom have been appointed to the company’s Board Strategic Review Committee. He also noted a cooperation agreement with Carronade Capital Management, saying Viasat believes the agreement is in the best interest of the company and its shareholders.

About Viasat NASDAQ: VSAT

Viasat, Inc NASDAQ: VSAT provides high‐capacity satellite broadband and wireless communications services to consumer, commercial and government customers worldwide. The company designs and operates satellite systems and network infrastructure to deliver secure, high-speed connectivity across remote and underserved regions, as well as managed networking solutions for enterprises and public sector agencies.

Viasat's product offerings include residential and enterprise satellite internet services, in-flight connectivity for commercial airlines and business jets, and secure networking platforms tailored to defense and intelligence users.

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