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VSAT beats Q1 fiscal 2027 earnings estimates despite lower revenues and a year-over-year sales decline.
Viasat reported higher contract awards, a 19% backlog increase, and lower interest expense, narrowing losses.
Viasat expects mid-single-digit revenue growth and about $180 million in free cash flow for fiscal 2027.
Viasat, Inc. (VSAT - Free Report) reported mixed first-quarter fiscal 2027 results, wherein the top line missed the Zacks Consensus Estimate but the bottom line beat the same.
The company reported a year-over-year revenue decline, reflecting ongoing headwinds in portions of its legacy commercial services portfolio and lower IP licensing revenues. However, its bottom line improved as reduced interest expense, driven by continued debt repayment, outweighed the impact of lower revenues.
Net Income
Viasat reported a net loss of $51.7 million or a loss of 38 cents per share compared with a net loss of $56.4 million or a loss of 43 cents per share in the prior-year quarter. The narrower loss was due to lower interest expense during the quarter.
Excluding non-recurring items, Viasat reported non-GAAP net income of $24.5 million or 17 cents per share compared with $23.1 million or 17 cents per share in the prior-year period. The bottom line beat the Zacks Consensus Estimate of 10 cents.
Revenues declined to $1.16 billion from $1.17 billion. The figure missed the consensus estimate of $1.2 billion. Product revenues were $324.1 million, down from $344.7 million in the year-ago quarter. Net sales from Service increased to $832.4 million from $826.4 million a year ago.
Revenues from the Communication Services segment were $825.1 million, down from $827.4 million in the prior-year quarter. The marginal revenue decline reflected lower contributions from residential fixed broadband and maritime services, which offset continued growth in aviation and government Satellite Communications. The segment’s adjusted EBITDA decreased to $311.3 million from $321.5 million.
Revenues from the Defense and Advanced Technologies (DAT) segment were $331.5 million, down 4% year over year, primarily due to weaker contributions from Advanced Technologies & Other and Space and Mission Systems, despite strong Tactical Networking growth. Adjusted EBITDA decreased to $69.9 million from $86.9 million in the year-ago quarter.
Other Details
In the June quarter, Viasat reported an operating income of $47.3 million compared with $46.7 million in the prior-year quarter. Adjusted EBITDA was $381.1 million, down from $408.5 million in the year-ago quarter. The net contract awards increased to $1.3 billion from $1.18 billion a year ago, while the backlog increased 19% year over year to $4.22 billion.
Cash Flow & Liquidity
During the first quarter of fiscal 2027, Viasat generated an operating cash flow of $260.6 million compared with $258.5 million in the prior-year period. As of June 30, 2026, the company had $1.74 billion in cash and cash equivalents, with a net debt of $4.83 billion.
Outlook
For fiscal 2027, management expects mid-single-digit revenue growth and flat to slightly up adjusted EBITDA year over year. Viasat anticipates the Communication Services segment’s low single-digit year-over-year revenue performance, due to continued growth in aviation services, offset by a decline in FS&O. DAT revenue growth is anticipated to be in the mid-teens, primarily driven by strong growth in information security and cyber defense, as well as space and mission systems and tactical networking.
Capital expenditure is expected to be between $950 million and $1 billion (including approximately $250-$300 million for Inmarsat-related capital expenditures). The company’s operating cash flow is expected to be flat year over year, and the free cash flow is anticipated to be approximately $180 million (excluding the benefit of the Ligado lump sum payments, as they are non-recurring).
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 18. The Zacks Consensus Estimate for earnings is pegged at $2.46 per share, suggesting growth of 43.02% from the year-ago reported figure.
Keysight has a long-term earnings growth expectation of 19.44%. The company delivered an average earnings surprise of 9.46% in the last four reported quarters.
Analog Devices, Inc. (ADI - Free Report) is set to release third-quarter fiscal 2026 earnings Aug. 19. The Zacks Consensus Estimate for earnings is pegged at $3.33 per share, implying growth of 62.44% from the year-ago reported figure.
Analog Devices has a long-term earnings growth expectation of 31.04%. The company delivered an average earnings surprise of 5.48% in the last four reported quarters.
Applied Materials, Inc. (AMAT - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 13. The Zacks Consensus Estimate for earnings is pegged at $3.36 per share, suggesting growth of 35.48% from the year-ago reported figure.
Applied Materials has a long-term earnings growth expectation of 32.44%. The company delivered an average earnings surprise of 6.06% in the last four reported quarters.
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Viasat Q1 Earnings Beat Estimates Despite Lower Y/Y Revenues
Key Takeaways
Viasat, Inc. (VSAT - Free Report) reported mixed first-quarter fiscal 2027 results, wherein the top line missed the Zacks Consensus Estimate but the bottom line beat the same.
The company reported a year-over-year revenue decline, reflecting ongoing headwinds in portions of its legacy commercial services portfolio and lower IP licensing revenues. However, its bottom line improved as reduced interest expense, driven by continued debt repayment, outweighed the impact of lower revenues.
Net Income
Viasat reported a net loss of $51.7 million or a loss of 38 cents per share compared with a net loss of $56.4 million or a loss of 43 cents per share in the prior-year quarter. The narrower loss was due to lower interest expense during the quarter.
Excluding non-recurring items, Viasat reported non-GAAP net income of $24.5 million or 17 cents per share compared with $23.1 million or 17 cents per share in the prior-year period. The bottom line beat the Zacks Consensus Estimate of 10 cents.
Viasat Inc. Price, Consensus and EPS Surprise
Viasat Inc. price-consensus-eps-surprise-chart | Viasat Inc. Quote
Revenues
Revenues declined to $1.16 billion from $1.17 billion. The figure missed the consensus estimate of $1.2 billion. Product revenues were $324.1 million, down from $344.7 million in the year-ago quarter. Net sales from Service increased to $832.4 million from $826.4 million a year ago.
Revenues from the Communication Services segment were $825.1 million, down from $827.4 million in the prior-year quarter. The marginal revenue decline reflected lower contributions from residential fixed broadband and maritime services, which offset continued growth in aviation and government Satellite Communications. The segment’s adjusted EBITDA decreased to $311.3 million from $321.5 million.
Revenues from the Defense and Advanced Technologies (DAT) segment were $331.5 million, down 4% year over year, primarily due to weaker contributions from Advanced Technologies & Other and Space and Mission Systems, despite strong Tactical Networking growth. Adjusted EBITDA decreased to $69.9 million from $86.9 million in the year-ago quarter.
Other Details
In the June quarter, Viasat reported an operating income of $47.3 million compared with $46.7 million in the prior-year quarter. Adjusted EBITDA was $381.1 million, down from $408.5 million in the year-ago quarter. The net contract awards increased to $1.3 billion from $1.18 billion a year ago, while the backlog increased 19% year over year to $4.22 billion.
Cash Flow & Liquidity
During the first quarter of fiscal 2027, Viasat generated an operating cash flow of $260.6 million compared with $258.5 million in the prior-year period. As of June 30, 2026, the company had $1.74 billion in cash and cash equivalents, with a net debt of $4.83 billion.
Outlook
For fiscal 2027, management expects mid-single-digit revenue growth and flat to slightly up adjusted EBITDA year over year. Viasat anticipates the Communication Services segment’s low single-digit year-over-year revenue performance, due to continued growth in aviation services, offset by a decline in FS&O. DAT revenue growth is anticipated to be in the mid-teens, primarily driven by strong growth in information security and cyber defense, as well as space and mission systems and tactical networking.
Capital expenditure is expected to be between $950 million and $1 billion (including approximately $250-$300 million for Inmarsat-related capital expenditures). The company’s operating cash flow is expected to be flat year over year, and the free cash flow is anticipated to be approximately $180 million (excluding the benefit of the Ligado lump sum payments, as they are non-recurring).
VSAT’s Zacks Rank
Viasat currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 18. The Zacks Consensus Estimate for earnings is pegged at $2.46 per share, suggesting growth of 43.02% from the year-ago reported figure.
Keysight has a long-term earnings growth expectation of 19.44%. The company delivered an average earnings surprise of 9.46% in the last four reported quarters.
Analog Devices, Inc. (ADI - Free Report) is set to release third-quarter fiscal 2026 earnings Aug. 19. The Zacks Consensus Estimate for earnings is pegged at $3.33 per share, implying growth of 62.44% from the year-ago reported figure.
Analog Devices has a long-term earnings growth expectation of 31.04%. The company delivered an average earnings surprise of 5.48% in the last four reported quarters.
Applied Materials, Inc. (AMAT - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 13. The Zacks Consensus Estimate for earnings is pegged at $3.36 per share, suggesting growth of 35.48% from the year-ago reported figure.
Applied Materials has a long-term earnings growth expectation of 32.44%. The company delivered an average earnings surprise of 6.06% in the last four reported quarters.