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Investing.com -- Eutelsat stock jumped nearly 5% after it reported stronger-than-expected annual earnings on Tuesday, supported by rising demand for its satellite internet services from government and enterprise clients.
Revenue from video, connectivity, and government services totaled €1.23 billion for the year ended June 30, a 0.8% increase from the previous year and slightly ahead of the €1.21 billion forecast in a company-compiled analyst consensus.
Revenue from its low Earth orbit (LEO) satellite operations surged 84.1% year-on-year to €187 million, with stronger government service demand driven by operations in Ukraine and growing interest from non-U.S. governments, notably Taiwan.
For the fourth quarter alone, revenues in Eutelsat’s operating verticals reached €326 million, roughly 5% above consensus estimates. Organic revenue declined 2.1% year-on-year, a slight improvement from the 2.2% drop in the previous quarter, though the video segment remained under pressure.
Full-year EBITDA stood at €676 million, ahead of the €625 million expected by analysts.
Looking ahead, Eutelsat expects LEO revenue to grow by 50% next year. While this will help offset losses in its legacy geostationary satellite segment, it won’t fully compensate yet.
The company reported a net loss of €1.1 billion for the fiscal year, largely due to impairments linked to its GEO assets.
Morgan Stanley (NYSE:MS) analysts said Eutelsat shares "are highly volatile, but up >30% year-to-date on the back of greater European defence spending and recent capital increase announcement."