Eutelsat Communications: Third Quarter and Nine-Month 2024-25 Revenues

 

Eutelsat Communications reports revenues for the Third Quarter and Nine Months ended 31 March 2025.

Christophe Caudrelier, Chief Financial Officer of Eutelsat said: “Third Quarter and Nine Month 2024-25 revenues were in line with our expectations and enable us to confirm our financial outlook for the Full Year. Double-digit growth in our Connectivity business unit was once again driven by LEO‑enabled solutions, as we continue to address the growing demand for our low orbit capacity.”

THIRD QUARTER REVENUES³

Total revenues for the Third Quarter stood at €300.0 million, at the same level as a year earlier on a reported basis, and down by 1.9% like-for-like.

Revenues of the four Operating Verticals (i.e., excluding ‘Other Revenues’) stood at €300.6 million. They were down 2.2% on a like-for-like basis. Quarter‑on‑quarter, revenues of the four Operating Verticals were down 3.1% like-for-like.

Note: Unless otherwise stated, all variations indicated hereunder are on a like-for-like basis, ie, at constant currency and perimeter.

Video (50% of revenues)

Third Quarter Video revenues amounted to €151.7 million, down 6.4% year-on-year, in line with the broader market trend. On a quarter-on-quarter basis, revenues were down 4.8% reflecting the linearisation of revenue recognition on certain contracts in Q2.

On the commercial front, Eutelsat renewed a video capacity agreement with its long-standing partner ATSS in the MENA region. Eutelsat also expended its services for Professional Video, committing significant new resources at the flagship HOTBIRD constellation at 13°East. Elsewhere, Eutelsat renewed its partnership with UAE-based content-distribution specialist, BHS, for satellite contribution services across the Middle East and North Africa, extending capacity leased on EUTELSAT 21B and EUTELSAT 70B.

Eutelsat is implementing EU Regulation 269/2014 concerning the denial of resources to Russian entities, which, since March 2025 is being applied to selected media groups by the French regulator, ARCOM. Following the recent removal of two channels, STS and Kanal 5, belonging to JSC National Media Group, Eutelsat is in the process of removing further channels controlled by this company, as well as those controlled by VGTRK, from Eutelsat capacity.

At this stage, the impact on the Group’s revenues of the removal of these channels is estimated at c.€16m euros on an annualised basis, and a similar amount at the EBITDA level, prior to any mitigation measures. Due to the timing, this action has a very limited impact on Eutelsat’s objectives for FY 2024‑25.

As a reminder, Eutelsat’s financial objectives exclude the impact of sanctions imposed on Russian customers by external authorities.

Connectivity (50% of revenues)

Total Connectivity revenues for the Third Quarter stood at €148.9 million up 2.7%² year‑on‑year, and down by 1.3% quarter-on-quarter.

Fixed Connectivity

Third Quarter Fixed Connectivity revenues stood at €59.7 million, up 0.8% year-on-year. They mainly reflected on the one hand, the continued growth of LEO-enabled connectivity solutions, and, on the other, the more challenging conditions for GEO-enabled consumer broadband in Europe, and notably by the cessation of revenue recognition from a specific customer on the KONNECT-VHTS satellite.

Quarter-on-quarter, revenues were down 7.3%, reflecting a one-off impact from catch up revenues from a LEO customer in Q2, as well as the above-mentioned cessation of revenue recognition from a GEO customer.

On the commercial front, the transfer of EUTELSAT KONNECT capacity to the African market has been completed. Take-up of the additional capacity has been dynamic, notably with a multi-year partnership with Orange Africa and Middle East for connectivity in Africa and the Middle East. Elsewhere, Eutelsat and InterSAT inked a new multi-year agreement for Ku capacity on EUTELSAT 7C for the delivery of fixed data services over Central and Eastern Africa, and renewed their existing capacity contract on EUTELSAT 70B. The two companies are in discussions aimed at adding LEO capacity for East Africa.

Government Services

Third Quarter Government Services revenues stood at €49.5 million, up 10.2% year-on-year. This mainly reflected the growth of LEO-enabled solutions revenues as well as increased demand from non‑US governments. Quarter-on-quarter, revenues were down 4.2%, notably due to slowdown in GEO activities.

The Spring 2025 renewal campaign with US Department of Defense resulted in an estimated renewal rate of less than 50%, below the high rates of previous quarters. It reflects the change in the new presidential administration’s geographic prioritization for the defense department, with the additional context of efforts to cut government spending overall. In particular, it embarks the non-renewal of a single sizable contract. Excluding this one-off, the renewal rate would have been c. 70%.

Mobile Connectivity

Third Quarter Mobile Connectivity revenues stood at €39.7 million, down 2.7% year-on-year, reflecting lower GEO revenues, partly offset by growing demand for LEO-based solutions. Quarter-on-quarter, revenues were up 14.3% underpinned by ramp-up on LEO.

On the commercial front, Eutelsat confirmed the traction of LEO-enabled services for commercial and business aviation, with over 100 certified antenna installations already completed, out of a backlog close to 1,000 aircraft, and the first aircraft now in service. In addition to its GEO offering, Eutelsat is delivering multi-orbit connectivity through key partners such as Intelsat, Hughes, Panasonic and Gogo. Air Canada became the first airline to deploy the multi-orbit GEO/LEO service, through Intelsat.

Separately, Eutelsat signed a multi-year, multi-million-dollar extension to its capacity agreement with Panasonic on EUTELSAT 10B, and the deployment of KONNECT VHTS capacity for the mobility market is also progressing well, notably with a new multi-year, multi-million-dollar agreement with Türksat for Ka-band services. Both showcase the ongoing pertinence of state-of-the-art GEO capacity to deliver high-quality, cost-effective in-flight connectivity services.

Other Revenues

‘Other Revenues’ amounted to -€0.7 million in the Third Quarter versus €0.5 million a year earlier and €3.3 million in the Second Quarter. They included a negative €3.1 million impact from hedging operations compared to a negative impact of €1.1 million last year and a positive impact of €0.3 million in the Second Quarter.

BACKLOG

The backlog stood at €3.6 billion as of 31 March 2025 versus €3.9 billion a year ago, and €3.7 billion at end-December 2024, reflecting its natural erosion, especially in the Video segment, in the absence of major renewals.

It was equivalent to 3.0 times FY 2024 revenues, with Connectivity representing 57%.

Note: The backlog represents future revenues from capacity or service agreements and can include contracts for satellites under procurement. Managed services are not included in the backlog.

NINE MONTH REVENUES

Revenues for the first Nine Months of FY 2024-25 stood at €906.2 million, up by 3.7% on a reported basis and by 2.2% at constant currency and perimeter.

Revenues of the four Operating Verticals (excluding ‘Other Revenues’) were up 1.8% on a like-for-like basis, excluding a positive currency effect of €5.0m.

OUTLOOK

On the back of the performance of the first Nine Months, we confirm our objectives for the Full Year 2024-25 of Operating Vertical Revenues around the same level as FY 2024⁵ and adjusted EBITDA margin slightly below the level of FY 2024⁶ .

Elsewhere, gross capital expenditure in FY 2024-25 remains expected in a range of €500-600 millions.

Eutelsat also continues to target leverage of c.3x in the medium term.

Note: This outlook is based on the nominal deployment plan. It assumes no further material deterioration of revenues generated from Russian customers

CORPORATE GOVERNANCE

On May 5^th, Eutelsat announced the appointment of Jean-François Fallacher as its new CEO. The appointment was decided at a Board Meeting held on May 4th, 2025, upon the recommendation of the Nomination and Governance Committee, and will be effective on June 1st, 2025. Jean-François Fallacher replaces Eva Berneke who has led the group since 2022.