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Iridium Falls 22% on Q2 Earnings Miss & Lowered View, Revenues Up Y/Y
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Key Takeaways
IRDM reported Q2 EPS of $0.20, down from $0.27, due to last year's one-time $19.8M gain not recurring.
Q2 revenue grew 8% to $216.9M, beating estimates, led by gains in service, equipment and engineering.
IRDM cut 2025 service revenue growth view to 3-5% amid subscriber losses and PNT revenue delay.
Iridium Communications ((IRDM - Free Report) ) reported earnings per share (EPS) of 20 cents for the second quarter of 2025, missing the Zacks Consensus Estimate by 13%. The bottom line compared unfavorably with the prior-year quarter's figure of 27 cents. The downtick reflects the absence of a one-time $19.8 million gain recorded last year related to the acquisition of Satelles, Inc.
Quarterly revenues came in at $216.9 million, up 8% year over year, driven by increasing strength across service revenues and equipment sales and engineering/support. The figure beat the consensus mark by 1%. As Iridium expands its next-gen services like D2D and PNT, and further capitalizes on strategic defense and commercial opportunities, it remains a strong contender in the global satellite communication landscape.
Total Service revenues rose 2% year over year to $155.6 million. Strong recurring revenues from an expanding subscriber base resulted in the upside. Service revenues contributed 72% to total revenues in the second quarter. Our estimate for the metric was $162.4 million.
Iridium’s commercial service segment continues to be the backbone of the company’s business, accounting for 59% of total revenues in the quarter. The metric rose 2% to $128.8 million, driven by strong IoT performance. Strength in voice and data and IoT amid soft results from commercial broadband contributed to the segment’s top-line performance. Government service revenues inched up 1% to $26.8 million, attributed to a contractual rate increase under its EMSS agreement with the U.S. Space Force.
Iridium Communications Inc Price, Consensus and EPS Surprise
Our estimate for total commercial service and government service revenues was pegged at $135.7 million and $26.8 million, respectively.
Subscriber Equipment sales declined 15% to $19.5 million, in line with company expectations, and are projected to remain flat for the full year. We projected the figure to be $24.1 million.
Engineering and support revenues surged 62% to $41.9 million, primarily due to increased U.S. government activity. This segment is also expected to grow through 2025, signaling ongoing demand for Iridium’s advanced satellite expertise.
Following the announcement, IRDM’s shares tumbled 22.09% in trading and closed the session at $25.26 on July 24, 2025. In the past year, shares have declined 13.1% against the Zacks Satellite and Communication industry's growth of 36.7%.
Image Source: Zacks Investment Research
Other Details
Total operating expenses were $166.6 million compared with $157.4 million in the prior-year quarter, primarily due to higher cost of services.
Operational EBITDA (OEBITDA) increased 6% year over year to $121.3 million, reflecting strength in recurring service and engineering and support revenues.
Operating income came in at $50.3 million compared with $43.6 million reported in the year-ago quarter.
As of June 30, the company had 2,483,000 billable subscribers, up 3% from 2,413,000 at the end of the prior-year quarter. The year-over-year rise was backed by strength in commercial IoT.
Liquidity
As of June 30, total cash, cash equivalents and marketable securities were $79.3 million, with $1.8 billion of net debt. Capital expenditures were $20.7 million in the quarter under review.
In the second quarter, Iridium repurchased 2.6 million shares for $65 million. Since the program’s inception in 2021, it has retired 34.8 million shares for $1.2 billion. As of June 30, 2025, $295.3 million remained available under the current authorization, which runs through 2027.
Updated 2025 Outlook: Trim in Service Revenues
While the company maintained its long-term outlook, it lowered its full-year 2025 service revenue growth guidance from 5%-7% to 3%-5%. The decrease is mainly due to three factors — the transition of maritime broadband to a companion service, voice subscriber losses related to canceled USAID funding noted in the first quarter and a delay in PNT revenues, now expected in 2026.
However, it continues to forecast OEBITDA at $490 million to $500 million, up from $470.6 million in 2024.
SAP SE ((SAP - Free Report) ) reported second-quarter 2025 non-IFRS earnings of €1.50 ($1.70) per share, climbing 37% from the year-ago quarter’s levels. The Zacks Consensus Estimate was pegged at $1.63.
In the past year, SAP’s stock has soared 34%.
America Movil, S.A.B. de C.V. ((AMX - Free Report) ) reported net income per ADR of 38 cents for the second quarter 2025 against a net loss per ADR of 2 cents reported in the prior-year quarter. The earnings figure, however, missed the Zacks Consensus Estimate of 49 cents.
Shares of AMX have gained 8.5% in the past year.
BlackBerry Limited ((BB - Free Report) ) reported first-quarter fiscal 2026 non-GAAP EPS of 2 cents. The figure beat the company’s estimate of a loss of 1 cent to breakeven. In the year-ago quarter, it reported a non-GAAP loss of 2 cents. The Zacks Consensus Estimate was pegged at breakeven.
BB’s shares gained 59.7% in the past year.
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Iridium Falls 22% on Q2 Earnings Miss & Lowered View, Revenues Up Y/Y
Key Takeaways
Iridium Communications ((IRDM - Free Report) ) reported earnings per share (EPS) of 20 cents for the second quarter of 2025, missing the Zacks Consensus Estimate by 13%. The bottom line compared unfavorably with the prior-year quarter's figure of 27 cents. The downtick reflects the absence of a one-time $19.8 million gain recorded last year related to the acquisition of Satelles, Inc.
Quarterly revenues came in at $216.9 million, up 8% year over year, driven by increasing strength across service revenues and equipment sales and engineering/support. The figure beat the consensus mark by 1%. As Iridium expands its next-gen services like D2D and PNT, and further capitalizes on strategic defense and commercial opportunities, it remains a strong contender in the global satellite communication landscape.
Total Service revenues rose 2% year over year to $155.6 million. Strong recurring revenues from an expanding subscriber base resulted in the upside. Service revenues contributed 72% to total revenues in the second quarter. Our estimate for the metric was $162.4 million.
Iridium’s commercial service segment continues to be the backbone of the company’s business, accounting for 59% of total revenues in the quarter. The metric rose 2% to $128.8 million, driven by strong IoT performance. Strength in voice and data and IoT amid soft results from commercial broadband contributed to the segment’s top-line performance. Government service revenues inched up 1% to $26.8 million, attributed to a contractual rate increase under its EMSS agreement with the U.S. Space Force.
Iridium Communications Inc Price, Consensus and EPS Surprise
Iridium Communications Inc price-consensus-eps-surprise-chart | Iridium Communications Inc Quote
Our estimate for total commercial service and government service revenues was pegged at $135.7 million and $26.8 million, respectively.
Subscriber Equipment sales declined 15% to $19.5 million, in line with company expectations, and are projected to remain flat for the full year. We projected the figure to be $24.1 million.
Engineering and support revenues surged 62% to $41.9 million, primarily due to increased U.S. government activity. This segment is also expected to grow through 2025, signaling ongoing demand for Iridium’s advanced satellite expertise.
Following the announcement, IRDM’s shares tumbled 22.09% in trading and closed the session at $25.26 on July 24, 2025. In the past year, shares have declined 13.1% against the Zacks Satellite and Communication industry's growth of 36.7%.
Image Source: Zacks Investment Research
Other Details
Total operating expenses were $166.6 million compared with $157.4 million in the prior-year quarter, primarily due to higher cost of services.
Operational EBITDA (OEBITDA) increased 6% year over year to $121.3 million, reflecting strength in recurring service and engineering and support revenues.
Operating income came in at $50.3 million compared with $43.6 million reported in the year-ago quarter.
As of June 30, the company had 2,483,000 billable subscribers, up 3% from 2,413,000 at the end of the prior-year quarter. The year-over-year rise was backed by strength in commercial IoT.
Liquidity
As of June 30, total cash, cash equivalents and marketable securities were $79.3 million, with $1.8 billion of net debt. Capital expenditures were $20.7 million in the quarter under review.
In the second quarter, Iridium repurchased 2.6 million shares for $65 million. Since the program’s inception in 2021, it has retired 34.8 million shares for $1.2 billion. As of June 30, 2025, $295.3 million remained available under the current authorization, which runs through 2027.
Updated 2025 Outlook: Trim in Service Revenues
While the company maintained its long-term outlook, it lowered its full-year 2025 service revenue growth guidance from 5%-7% to 3%-5%. The decrease is mainly due to three factors — the transition of maritime broadband to a companion service, voice subscriber losses related to canceled USAID funding noted in the first quarter and a delay in PNT revenues, now expected in 2026.
However, it continues to forecast OEBITDA at $490 million to $500 million, up from $470.6 million in 2024.
IRDM’s Zacks Rank
Iridium currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Recent Performances of Other Firms
SAP SE ((SAP - Free Report) ) reported second-quarter 2025 non-IFRS earnings of €1.50 ($1.70) per share, climbing 37% from the year-ago quarter’s levels. The Zacks Consensus Estimate was pegged at $1.63.
In the past year, SAP’s stock has soared 34%.
America Movil, S.A.B. de C.V. ((AMX - Free Report) ) reported net income per ADR of 38 cents for the second quarter 2025 against a net loss per ADR of 2 cents reported in the prior-year quarter. The earnings figure, however, missed the Zacks Consensus Estimate of 49 cents.
Shares of AMX have gained 8.5% in the past year.
BlackBerry Limited ((BB - Free Report) ) reported first-quarter fiscal 2026 non-GAAP EPS of 2 cents. The figure beat the company’s estimate of a loss of 1 cent to breakeven. In the year-ago quarter, it reported a non-GAAP loss of 2 cents. The Zacks Consensus Estimate was pegged at breakeven.
BB’s shares gained 59.7% in the past year.