Eutelsat’s Strategic Shift Gains Traction Amid Mixed Financial Results

Eutelsat FR0010221234

The satellite operator Eutelsat is navigating a pivotal strategic transformation. Its recent half-year financial report for 2025/26, filed with French regulators, reveals a company in transition, where a burgeoning new segment is beginning to counterbalance legacy challenges, albeit with a near-term cost to profitability.

For the first half of its fiscal year, Eutelsat’s reported revenue declined by 2.4% to €592 million. On a constant-currency basis, however, overall business remained stable. The underlying story is one of a significant shift in revenue composition, driven by divergent performances across its divisions.

The standout growth came from the Low Earth Orbit (LEO) segment, which includes its OneWeb activities. Revenue there surged by an impressive 59.7% to €111 million. This dynamic growth means the LEO business now contributes approximately one-fifth of the group’s total revenue. This strategic success, however, has pressured overall margins. The company’s adjusted EBITDA fell to €308 million, with the corresponding margin contracting by 3.4 percentage points to 52.1%. Management attributed this margin compression to sanction-related losses in its traditional video business and the initial operational costs associated with launching its new satellite constellation.

A Fortified Balance Sheet for Future Investment

Beyond the operational metrics, Eutelsat has made substantial progress in strengthening its financial foundation. A capital increase of over €1.5 billion, coupled with secured financing from export credit agencies, led to credit rating upgrades from both Moody's and Fitch. This reinforced balance sheet is critical for funding the company’s ambitious investment roadmap. To keep the OneWeb constellation technologically competitive, Eutelsat has already secured the procurement of an additional 440 LEO satellites.

CEO Jean-François Fallacher expressed confidence in the full-year outlook, which the company has reaffirmed. The current strategic focus is squarely on converting the robust revenue growth in the LEO segment into sustainable profitability, even as continued investment in the satellite fleet proceeds.

While the core satellite video business shows signs of stagnation, the LEO division is emerging as the anticipated engine for future expansion. The half-year results demonstrate that Eutelsat’s restructuring is indeed producing effects, though the path to renewed financial momentum involves navigating the costs of this ambitious repositioning.

@ boerse-global.de | FR0010221234 EUTELSAT’S