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MCLEAN, Va. - On Thursday, Iridium Communications Inc. (NASDAQ:IRDM) reported third-quarter results that exceeded analyst expectations, as the satellite communications provider updated its full-year service revenue growth outlook.
The company’s shares fell 2.70% in pre-market trading following the results.
The company reported third-quarter earnings of $0.35 per share, significantly beating the analyst consensus of $0.26. Revenue reached $226.9 million, surpassing expectations of $220.77 million and representing a 7% increase YoY. Service revenue, which accounts for 73% of total revenue, grew 3% to $165.2 million compared to the same period last year.
Operational EBITDA for the quarter rose 10% YoY to $136.6 million, while total billable subscribers increased 2% YoY to 2.542 million, led by growth in commercial IoT subscribers.
Despite these positive results, Iridium updated its full-year 2025 outlook, tightening service revenue growth expectations to approximately 3%, down from its previous guidance of 3-5%. However, the company slightly raised its OEBITDA guidance to between $495 million and $500 million, from the previous range of $490-500 million.
"We continue to execute with discipline, focusing efforts on growth markets where our unique network delivers a competitive advantage, specifically in government, regulated industries, and critical infrastructure," said Matt Desch, CEO of Iridium. "Our continued strong cash flow supported the increase in our quarterly dividend, equivalent to a 5% increase for the full year."
The company maintained its quarterly dividend of $0.15 per share but announced it has paused its share repurchase program to invest in strategic growth initiatives and continue deleveraging its balance sheet. Iridium ended the quarter with gross term loan debt of $1.8 billion and a net leverage ratio of 3.5 times trailing twelve months OEBITDA.
Commercial service revenue increased 4% to $138.3 million, while government service revenue grew 1% to $26.9 million. Equipment revenue declined 3% to $21.5 million, and the company expects equipment sales to be modestly lower for full-year 2025 compared to 2024.
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