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Investing.com -- Iridium Communications Inc. (NASDAQ:IRDM) shares tumbled 19.7% after the satellite communications provider reported second-quarter earnings that fell short of analyst expectations, despite posting better-than-expected revenue.
The company reported earnings per share of $0.20 for the second quarter of 2025, missing the analyst consensus of $0.24 by $0.04. Revenue came in at $216.9 million, slightly above the consensus estimate of $214.01 million and up 8% compared to the same period last year. The earnings miss appears to have triggered the significant stock selloff despite the revenue beat.
Iridium also lowered its full-year 2025 service revenue growth guidance to between 3% and 5%, down from its previous forecast of 5% to 7%. The company maintained its outlook for Operational EBITDA between $490 million and $500 million.
"We’re making great progress on our direct-to-device service with testing now underway and are also finding exciting, innovative applications for our new PNT service," said Matt Desch, CEO of Iridium. "I’m pleased that the Board approved an increase to our September quarterly dividend. This 5% increase for the full year demonstrates our confidence in Iridium’s long-term prospects and continued growth."
Service revenue, which represents 72% of total revenue, grew 2% YoY to $155.6 million. Commercial service revenue increased 2% to $128.8 million, with commercial IoT data revenue rising 8% YoY to $44.8 million. Total (EPA:TTEF) billable subscribers grew 3% YoY to 2,483,000, led by growth in commercial IoT.
Engineering and support revenue surged 62% to $41.9 million, primarily due to increasing activity with the U.S. government. Equipment revenue declined 15% to $19.5 million compared to the prior-year quarter.
The company ended the quarter with a cash balance of $79.3 million and net leverage of 3.6 times trailing twelve months OEBITDA. Iridium’s board declared a quarterly dividend of $0.15 per share for the third quarter, representing a full-year increase of 5.5%.
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