Eutelsat Shares Gain on Strategic Connectivity Deal

Eutelsat FR0010221234

A new partnership in Africa has provided a positive start to the year for Eutelsat's equity, demonstrating a tangible application for its OneWeb low-Earth orbit (LEO) constellation. The collaboration in Gabun, focused on mobility services, addresses a segment where investors have previously harbored significant doubts. The key question now is whether this initiative can evolve into a sustainable growth driver for the company's LEO operations.

Trading on Euronext Paris last Friday saw Eutelsat shares close at €1.786, marking a single-day advance of 4.69%. This performance represented a clear recovery from the session's lows around €1.69. Notably, trading volume exceeded 2.4 million shares, suggesting heightened interest from institutional participants. The company's market capitalization once again crossed the €2 billion threshold. Following considerable volatility in late 2025, this upward move is being viewed as an early signal of stabilization for the current quarter.

This positive price action is closely tied to a recently strengthened balance sheet. In December 2025, Eutelsat concluded a rights issue that raised approximately €670 million. The capital increase was aimed at reducing corporate debt while securing funds for the next-generation Gen-2 satellite fleet.

Concurrently, the company received a boost from credit rating agencies. Early in December, Moody's upgraded Eutelsat's corporate family rating to Ba3 with a stable outlook. This adjustment helped alleviate previously dominant bankruptcy concerns, which had weighed heavily on the share price throughout much of the past year.

Gabun Partnership: A Concrete LEO Use Case

The company has announced the launch of a collaborative venture in Gabun. Together with telecommunications provider Airtel Gabon, Eutelsat will leverage its OneWeb LEO network to deliver broadband internet connectivity to passenger trains.

This project forms part of a national digital infrastructure initiative led by Gabun's Ministry of Digital Economy and Transport. Implementation will be carried out in cooperation with SETRAG, the operator of the Transgabon Railway.

Key details of the agreement include:

• Technology: Deployment of the low-latency OneWeb LEO satellite constellation.
• Application: Providing internet access for rail transport, particularly in topographically challenging regions with limited terrestrial infrastructure.
• Partners: Airtel Gabon serves as the telecom partner, with SETRAG as the rail operator.
• Strategic Importance: The project demonstrates the practical, commercial viability of LEO services within the business-to-business mobility sector.

This partnership provides a concrete example of LEO connectivity beyond stationary internet provision. In the context of the OneWeb merger, it serves as a significant signal to the market, as the monetization strategy for the LEO fleet has long been viewed as an uncertainty.

Strategic Implications and Outlook

Eutelsat's stock is currently benefiting from a combination of operational progress in its LEO division and an improved capital structure. While the financial scale of the Gabun contract is limited, it proves that the integration of OneWeb is translating into real-world projects.

Operationally, this venture signals technological maturity in the high-growth "Connectivity on the Move" field. The recent share price appreciation suggests investors may be adopting a more constructive view—provided Eutelsat can secure further contracts of this nature to substantiate the scalability of its LEO business model.