Q4 2025 Viasat Inc Earnings Call

Please standby your program is about to begin my name as friends and I will be your conference facilitator of this afternoon. At this time I would like to welcome everyone to Viasat fourth quarter and fiscal year 2025 earnings results Conference call. All lines have been placed on mute to prevent any <unk>.

Franz: Please stand by, your program is about to begin. My name is Franz and I will be your conference facilitator this afternoon. At this time, I would like to welcome everyone to ViaSat's fourth quarter and fiscal year 2025 earnings results conference call.

Franz: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be question and answer session.

Oh nice.

Speaker Change: After the Speakers' remarks, there will be question and answer session I would now like to turn the call over to MS. Lisa Curran, Vice President of Investor Relations. Ms. Curran you may begin your conference.

Lisa Curran: I would now like to turn the call over to Ms. Lisa Curran, Vice President of Investor Relations. Ms. Curran, you may begin your conference.

France: Thanks, France, we will present certain non-GAAP financial measures on today's call information required by the SEC relating to these non-GAAP financial measures is available in our Q4 fiscal year 2025 shareholder letter and today's conference call slides that are available on the investor.

Lisa Curran: Thanks, France. We will present certain non-GAAP financial measures on today's call. Information required by the SEC relating to these non-GAAP financial measures is available in our Q4 Fiscal Year 2025 shareholder letter and today's conference call slides that are available on the Investor Relations section of our website. During the presentation, we will describe certain of the more significant factors that impacted year-over-year performance.

Speaker Change: Our relations section of our website.

Speaker Change: During the presentation, we will describe certain of the more significant factors that impacted year over year performance. We will also make forward looking statements within the meaning of the federal Securities laws.

Lisa Curran: We will also make forward-looking statements within the meaning of the Federal Securities Law, including statements regarding events or developments that we expect or anticipate will or may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties and actual results might differ materially from any forward-looking statements that we make today. Information regarding these factors that may cause actual results to differ materially from forward-looking statements is available in our SEC filings and annual report on Form 10-K. These forward-looking statements speak only as of the date they are made and we do not assume any obligation to update any forward-looking statements.

Speaker Change: Certain statements regarding events or developments that we expect or anticipate will or may occur in the future. These forward looking statements are subject to a number of risks and uncertainties and actual results might differ materially from any forward looking statements that we make today.

Speaker Change: Information regarding these factors that may cause actual results to differ materially from these forward looking statements is available in our SEC filings and annual report on Form 10-K. These forward looking statements speak only as of the date. They are made and we do not assume any obligation to update any forward looking statements with that I'll turn it over to Mark King.

Mark Stankberg: With that, I will turn it over to Mark Stankberg, Chairman and CEO. Good afternoon and thanks for joining us today. With me, along with Lisa, we have Garrett Chase, our Chief Financial Officer, and Shawn Duffy, our Chief Accounting Officer. As always, we encourage reading the shareholder letter and referencing the slides we posted on our website earlier this afternoon for more detail.

Mark King: Chairman and CEO.

Mark King: Good afternoon, and thanks for joining us today.

Speaker Change: Me, along with Lisa Hey, Gary Chase, our Chief Financial Officer, and Shawn Duffy, our Chief Accounting Officer.

Speaker Change: As always we encourage reading the shareholder letter and referencing the slides we posted on our website earlier this afternoon for more details.

Mark Stankberg: Our fiscal 2025 was a pivotal year, creating the foundation for multi-year accelerated growth and sustained cash flow through increased earnings and decreasing capital intensity. We're pleased with our operational performance and very appreciative of the accomplishments of our team towards our strategic goals that we set for the year. We met or beat our guidance metrics, achieved record new contract awards growth, made significant progress on our capital structure, integrated the first ViaSat 3 Flight 1 into our global network, demonstrating the expected benefits to user experience and network efficiency. We completed critical milestones on our satellite roadmap, earned an inspiring reception to the new multi-orbit Nexus Wave maritime broadband service, introduced several network optimization innovations, delivering substantial efficiency and user experience gains.

Speaker Change: Our fiscal 2025 was a pivotal year, creating the foundation for multi year accelerated growth and sustained cash flow through increased earnings and decreasing capital intensity. We're pleased with our operational performance and very appreciative of the accomplishments of our team towards our strategic goals that we set for the year.

Speaker Change: We met or beat our guidance metrics achieved record new contract awards growth made significant progress on our capital structure integrated the first.

Speaker Change: Three one into our global network, demonstrating the expected benefits to user experience and network efficiency, we completed critical milestones.

Speaker Change: Road map earned an inspiring reception to the new multi orbit Nexus ways Maritime broadband service introduced several network optimization innovations delivering substantial efficiency and user experience gains.

Mark Stankberg: We reached new win-win third-party network agreements, including using Leo capacity to reduce latency for all mobility users, while also enhancing capital efficiency. And we made organizational changes to further improve speed, agility, and greater structural optionality. We enhanced financial transparency with new reporting segments and accompanying disclosures. We're also bringing major innovations to our unique and valuable spectrum rights in the mobile satellite services market segment at LBAN and the new MSS service capabilities they enable for our customers. Working with the Mobile Satellite Services Association, or MSSA, we're laying the foundation for an open architecture standards-based ecosystem for non-terrestrial networks, or NTN, extensions to the 5G and 6G networks of the future.

Speaker Change: We reached new win win third party network agreements, including using Leo capacity to reduce latency for our mobility users.

Speaker Change: So enhancing capital efficiency, and we made organizational changes to further improve speed agility and greater structural optionality.

We enhanced financial transparency with new reporting segments and accompanying disclosures.

Speaker Change: We're also bringing major innovations to our unique and valuable spectrum rights in the mobile satellite services market segment.

Speaker Change: And the new <unk>.

Speaker Change: Our service capabilities.

Speaker Change: They enable for our customers working with the mobile satellite Services Association, where MSA, we're laying the foundation for open architecture standards based ecosystem for noninterest real networks MTN extensions to the <unk> and <unk> networks of the future.

Mark Stankberg: Existing and emerging 3GPP standards foster interoperability for consumer mobile devices between terrestrial and a single individual satellite network. The MSSA's framework builds on those standards, enabling choice, scale, and substantially lower costs by creating an approach to NTN interoperability with and among all of the participating space networks. That approach, as adopted by space and terrestrial ecosystem participants, means mobile phones, cars, drones, and virtually any standards-compliant device can use a much more cost-effective aggregation-coordinated satellite spectrum globally versus depending on a single capricious constellation.

Speaker Change: Existing and emerging <unk>.

Speaker Change: <unk> standards faster interoperability for consumer mobile devices between terrestrial and a single individual satellite network.

Speaker Change: The Msas framework built on those standards, enabling choice scale and substantially lower costs by creating an approach to MTN interoperability with end demand.

Speaker Change: Participating space networks that approach has adapted by space and terrestrial ecosystem participants.

Speaker Change: <unk> mobile phones.

Speaker Change: As drones and virtually any standards compliant advice.

Speaker Change: And use a much more cost effective aggregation coordinated satellite spectrum globally versus depending on a single capricious constellation.

Speaker Change: <unk> is focused on three major L band business objectives.

Mark Stankberg: ViaSat is focused on three major LBAN business objectives. First, is substantially reducing capital and operating costs for mobile satellite services, non-terrestrial network, open architecture, and standards-based space systems. Second, supporting, transitioning, and evolving our critical government, maritime, and aeronautical safety services to the enhanced capabilities they'll need in the fully connected, autonomous, unmanned AI future by leveraging those next generation space assets. Third, transitioning our nascent global direct-to-device NTN business from the existing narrowband Internet of Things emergency and messaging standards to the emerging 5G new radio services market as new chips and devices enter and penetrate the market over the next few years.

Speaker Change: The substantially reducing capital and operating costs for mobile satellite services non terrestrial network open architecture and standards based space systems.

Speaker Change: Supporting transitioning and above a critical government maritime and aeronautical safety services.

Speaker Change: To the enhanced capabilities that will need in the fully connected autonomous unmanned AI future.

Speaker Change: Those next generation space assets.

Speaker Change: Third transitioning our Nathan global direct to device MTM business from the existing narrow band Internet of things emergency.

Speaker Change: Emergency and messaging standards to the emerging.

Speaker Change: <unk>, New radio services market as new chips and devices enter and penetrate the market over the next few years.

Gary: I can give a little color on a few key important topics before Gary goes into more detail on the financial and operational results.

Mark Stankberg: I can give a little color on a few key important topics before Gary goes into more detail on the financial and operational results. Of course, one of our highest priorities is getting ViaSat-3 Flights 2 and 3 into service, and we've been maintaining status on our satellite roadmap. For Flight 2, the critical path has been corrective actions and testing the reflectors and integrating with the rest of the spacecraft. We are still planning to shift the spacecraft to the launch site this summer. We've adjusted the in-service date in the roadmap to better reflect various potential schedule uncertainties after we ship it.

Gary: Of course, one of our highest priorities is getting past that three <unk>, two and three into service and we've been maintaining status on a satellite roadmap.

Gary: Tied to the critical path has been corrective actions and testing the reflectors and integrating with the rest of the spacecraft.

Gary: Still planning to ship the spacecraft to the mine site. This summer.

Gary: We've adjusted the in service date in the roadmap to better reflect various potential schedule uncertainties. After we ship it.

Yes, three scheduled critical path goes through antenna sub system integration.

Mark Stankberg: The F3's scheduled critical path goes through antenna subsystem integration, but that uses a different manufacturer design, not requiring corrective action. Our ViaSat-3 Flight 1 usage has been scaling steadily, and we have really good results there. Even with the antenna anomaly, we have almost 2,000 planes that are served by that ViaSat-3 Flight 1 satellite. tens of thousands of cumulative clients and hundreds more every day. We commissioned a survey to compare our service on Hawaii routes to what that satellite is serving, in particular, so we could benchmark user experience against the LEO competition. The results are very favorable and shown on page 10 of our online slide.

Gary: But that gives us a different manufacturer and designed not required corrective actions.

Gary: Our viasat three one usage has been scaling steadily and we have really good results there.

Gary: Even with the antenna anomaly.

Gary: Almost 2000 planes that are served by that.

Gary: <unk> III satellite tens of thousands of accumulated.

Gary: And hundreds more everyday.

Gary: We commissioned a survey to compare our service on Hawaii routes, which is what that satellite is serving in particular, so we can benchmark user experience against the competition. The results are very favorable and shown on page 10 of our online sites.

Mark Stankberg: They support our view that competition is primarily about delivering measurably reliable and consistent free Wi-Fi while also providing single interface for airlines to help manage, monetize, and integrate all the passenger entertainment and connectivity services. We've been a leader in innovating, delivering, and measuring those services and are increasingly confident that the combination of our existing and planned satellite fleet with our third-party partners will compete very well in our target market. Of course, we can still improve by judiciously integrating more LEO networks to both further optimize latency-sensitive traffic and improve economics while meeting industry-leading service quality and reliability metrics.

Gary: They support our view that competition is primarily about delivering measurably reliable and consistent free Wi Fi.

Gary: Also providing a single interface for airlines.

Manage monetize and integrate all of that passenger entertainment.

Gary: Connectivity services.

Gary: We've been a leader in innovating delivering and measuring those services and are increasingly confident that the combination of our existing and planned satellite fleet with our third party partners will compete very well in our target.

Gary: Of course, we can still improve by judiciously integrating or Leo networks to both further optimize latency sensitive traffic and improved economics.

Gary: Meeting industry, leading service quality and reliability metrics.

Mark Stankberg: Nexus Wave. The Mokyo-Urban Airtime Service is already off to a good start. Terms of our Telestat Lightspeed blended with our existing and forthcoming owned and third party fleets and our existing and planned user terminals and network capabilities.

Gary: Nexus wave.

Multi orbit Maritime service is already off to a good start.

Gary: Terms of Telesat Lightspeed agreement.

Gary: Blended with our existing and forthcoming owned and third party fleets and our existing and planned user terminals and network capabilities can.

Mark Stankberg: can improve user experiences and extend market access for all our mobility customers, enhance our competitive position, and reduce capital intensity.

Can improve user experiences and extend market access for all of our mobility customers enhance our competitive position and reduce capital intensity.

Gary: Finally, we can't comment much on an ongoing court proceedings related to the Lugano bankruptcy as you may know bucardo voluntarily dismiss its lawsuit against Inmarsat when faced with our motion to dismiss.

Mark Stankberg: Finally, we can't comment much on ongoing court proceedings related to the Lugato bankruptcy. As you may know, Lugato voluntarily dismissed its lawsuit against Inmarsat when faced with our motion to dismiss. While Lugato subsequently re-filed a similar case in New York, our position remains that Lugato's case has no legal merit and is replete with unfounded allegations of fact that are directly contradicted by Lugato's sworn statements to other courts, including the bankruptcy court. We'll continue to vigorously pursue our claims in the bankruptcy and defend against Legato's meritless lawsuit. Until then, any future cash payments from Legato have been excluded from our financial outlook, and they remain as upside.

Legato subsequently re filed a similar case in New York, our position remains that <unk> case has no legal merit and is replete with unfounded allegations of fact that are directly contradicted by legato is sworn statements to other courts, including the bankruptcy court.

Gary: We will continue to vigorously pursue our claims and the bankruptcy and defend against the <unk> lawsuit.

Gary: Until then any future cash payments from Lucado had been excluded from our financial outlook and they remain as upside.

Gary: We exited fiscal 2025 stronger than when we entered as you can see by our healthy backlog growing operating cash flow moderating capital expenses and continued awards growth in key businesses.

Mark Stankberg: We exit fiscal 2025 stronger than when we entered, as you can see by our healthy backlog, growing operating cash flow, moderating capital expenses, and continued awards growth in key businesses. We believe that growth is durable. It's supported by market proof points in our company earnings presentation, including American Airlines selecting us to scale to free Wi-Fi, several very successful free Wi-Fi domestic trials. New Global Airline Awards and third-party survey data showing ViaSat-3 delivering world-class passenger in-flight Wi-Fi experience and satisfaction on ViaSat-3 Flight 1 flights between Hawaii and the U.S.

Gary: And we believe that growth is durable.

Gary: Courted by market proof points in our company earnings presentation <unk>.

Gary: <unk> American airlines selecting us the scale to free Wi Fi several very successful free Wi Fi domestic trials.

Gary: New Global airline Awards and third Party survey data showing viasat three delivering world class passenger in flight Wi Fi experience and satisfaction on Viasat three one flights between Hawaii and the U S.

Gary: Looking ahead, we know success in fiscal 2026 is more than just hitting numbers, it's about accelerating growth and securing our future.

Mark Stankberg: Looking ahead, we know success in fiscal 2026 is more than just getting numbers. It's about accelerating growth and securing our future. We've got a comprehensive plan for reducing capital intensity. Generating sustainable, compelling, operating in free cash flow, reinforcing our competitive positions, unlocking portfolio value, and driving returns and shareholder value.

Gary: Kind of a comprehensive plan for reducing capital intensity.

Gary: Generating sustainable compelling operating and free cash flow reinforcing our competitive positions unlocking portfolio value and driving returns and shareholder value.

Mark Stankberg: As we wrap up Fiscal 25, Fiscal 26 is a year to position for growth. We know there will be challenges, but we're playing to win.

Gary: As we wrap up fiscal 'twenty five fiscal 'twenty six of the year to position for growth, we know there'll be challenges, but we are playing to win.

Garrett Chase: So now Gary will go into more depth on financial and operating risk. Thank you, Mark. Good afternoon, everyone. I'm joining us on the call. Before I start, let me thank the ViaSat team for the hard work that created solid results for the year. Thank you for delivering for our customers and Let me start by recapping our top financial priorities. First, build our franchise's earnings power and customer lifetime value, which leads to sustained and growing free cash flow. That's a function of profitable growth and disciplined investment in our future. Sustained free cash flow then allows us to reduce the leverage that's pressuring our debt equity price.

Gary: So now Gary will go into more depth on our financial and operating results.

Gary: Thank you Mark and good afternoon, everyone joining us on the call before I start let me. Thank the <unk> team for the hard work that created solid results for the year. Thank you for delivering for our customers announce let me start by recapping, our top financial priorities first build our franchises earnings power and customer lifetime.

Gary: Which leads to sustained and growing free cash flow, that's a function of profitable growth and disciplined investment our future.

Gary: Sustained free cash flow that allows us to reduce the leverage that's pressuring our debt equity prices paying down debt is our top priority for capital allocation now let me briefly recap the fourth quarter and fiscal 'twenty five results. The team delivered solid results for the quarter and the year and met our full year plan.

Garrett Chase: Paying down debt is our top priority for capital allocation.

Garrett Chase: Now let me briefly recap the fourth quarter and fiscal 25 results. The team delivered solid results for the quarter and the year and met our four-year plan. In the fourth quarter, we delivered revenue of $1.15 billion GATT net income of $246 million loss and adjusted EBITDA of $375 million for a 32.7% adjusted EBITDA margin. Adjusted EBITDA included a $6 million foreign exchange loss and $18 million of non-cash write-offs. Excluding these items, margins would have been about two points higher. The charges resulted primarily from efficiencies integrating the ViaSat and InMarsat networks and helped reduce cap spending in the years ahead.

Gary: In the fourth quarter, we delivered revenue of $1. One 5 billion GAAP net income of $246 million loss and adjusted EBITDA of $375 million for a 32, 7% adjusted EBITDA margin.

Gary: Adjusted EBITDA included a $6 million foreign exchange loss and $18 million of noncash write offs. Excluding these items margins would have been about two points higher.

Speaker Change: The charges resulted primarily from efficiencies integrating the bias at Newmar sat networks and helped reduce cap spending in the years ahead. Mark noted are pushed to take further advantage of such opportunities and I'll speak to their future impacts in my remarks on the outlook.

Garrett Chase: Mark noted our push to take further advantage of such opportunities and I'll speak to their future impacts in my remarks on the outlook. We also produced about $50 million of free cash flow, our biggest focus. With solid double-digit growth in operating cash flow and lower CapEx than our last guidance with no impact on next year's expected spend. In the last two quarters, we've reduced combined fiscal 25 and 26 CapEx by close to $300 million. Awards were solid at $1.2 billion, including European Space Agency's Moonlight Program, expanded scope with Etihad Airways, and multiple Nexus Wave awards as highlights.

Speaker Change: We also produced about $50 million of free cash flow, our biggest focus with solid double digit growth in operating cash flow and lower capex in our last guidance with no impact on next year is expected to spend in the last two quarters, we've reduced combined fiscal 'twenty five 'twenty six capex by close to $300 million.

Speaker Change: Awards were solid at $1 2 billion, including European space agencies, Moonlight program expanded scope of that Hot Airways and multiple Nexus wave of warrants as highlights we took $160 million write down in our communication services segment related to the exited certain EMEA Brown network assets and related contracts as we continued integration of leg.

Garrett Chase: We took a $160 million write-down in our communications services segment related to the exit of certain EMEA ground network assets and related contracts as we continued integration of legacy networks. In communications services, revenue declined 4%, primarily driven by the decline in fixed services and other end product revenue, partially offset by strength in governments.com and aviation service revenue. Our commercial aviation business showed continued growth in a quarter, with in-service aircraft of 4,030, up 10%, despite slower deliveries, and backlog of 1,600, up 18%. That backlog underpins our growth outlook for this business over the next few years.

Speaker Change: <unk> networks.

Speaker Change: And communication services revenue declined 4%, primarily driven by the decline in fixed services and other and product revenue, partially offset by strength in government Satcom and aviation service revenue or.

Speaker Change: Our commercial aviation Asian business showed continued growth in the quarter than service aircrafts are 4030 up 10% despite slower deliveries backlog of 1600 up 18% and backlog underpins our growth outlook for this business over the next few years.

Garrett Chase: Business aviation and service aircraft were more than 2,000, up 12% year-over-year. Maritime revenue was down 8% as we expected to trough in the fourth quarter. We're making progress scaling Nexus Wave installs and ended the quarter with more than 100 shifts in active service and orders for nearly 500 more. In governments.com, we have revenue growth of 16%. Our US fixed broadband revenue continued to be challenged with capacity constraints. Fixed services and other revenue is down 19% year over year. Our debt business continues to enjoy great momentum with revenue up 11% for the quarter and 17% for the year, including the $95 million one-time revenue impact of last year's legal settlement.

Speaker Change: This aviation in service aircraft, where more than 2000 up 12% year over year.

Speaker Change: <unk> revenue was down 8% as we expected to trough in the fourth quarter, we're making progress scaling nexus ways installs and ended the quarter with more than 100 ships in active service and orders for nearly 500 more.

Speaker Change: And government Satcom, we have revenue growth of 16% our U S. Fixed broadband revenue continued to be challenged with capacity constraints fixed services and other revenue was down 19% year over year.

Speaker Change: That business continues to enjoy great momentum with revenue up 11% for the quarter and 17% for the year, excluding the $95 million one time revenue impacts of last year's legal settlement.

Garrett Chase: Our InfoSec and cyber business is the largest franchise in our debt segment. Fourth quarter product revenue is $97 million up 8%. Awards more than doubled driven by favorable secular trends, product cycles, and white space product.

Speaker Change: <unk> cyber business is the largest franchise in our data segment fourth quarter product revenue was $97 million up 8% awards more than doubled driven by favorable secular trends product cycles, and white space product launches for fiscal year 'twenty five we delivered revenue of $4 5 billion, a GAAP net loss of 575 million.

Garrett Chase: For fiscal year 25, we delivered revenue of $4.5 billion, a gap net loss of $575 million, adjusted EBITDA of $1.55 billion for a 34.2% adjusted EBITDA margin. Adjusted EBITDA grew 4% over the $1,488,000,000 prior year base referenced in the supplemental information section of our investor website. Growth of 4% in the face of almost $200 million of revenue declines in our fixed services and other business areas, a testament to the diversity and resiliency of our overall business portfolio. Turning to our fiscal 26 outlook, we expect modest revenue growth with flattish adjusted EBITDA, which we expect will be plus or minus 1% from the $1,547,000,000 delivered in fiscal 25.

Speaker Change: Adjusted EBITDA of $1 $5 5 billion for a 34, 2% adjusted EBITDA margin adjusted EBITA grew 4% over the billion 488 million prior year base referenced in the supplemental information section of our Investor website.

Speaker Change: Growth of 4% in the face of almost $200 million of revenue declines in our fixed services and other business area is a testament to the diversity and resiliency of our overall business portfolio.

Speaker Change: Turning to our fiscal 'twenty six outlook, we expect modest revenue growth with flattish adjusted EBITDA, which we expect will be plus or minus 1% from the $1.547 billion delivered in fiscal 'twenty five.

Garrett Chase: To put more context around Flattish, let me delineate some of the items we'll be overcoming this year. We'll incur about $60 million of additional third-party bandwidth expense versus the prior year to meet customer needs in the present and future. We'll face $30 million of additional operating costs, $80 million in total, to ready our ViaSat 3 ground network for the service entry of Flight Secure and 3. Recall as well that Fiscal 25 benefited from very high and lucrative Prelisware royalty revenues, and we do not expect these revenues to continue at the rates we realized in Fiscal 25.

Speaker Change: To put more context around flattish, let me delineate some of the items, we'll be overcoming this year, we will incur about $60 million of additional third party bandwidth expense versus the prior year to meet customer needs in the present and future will face $30 million of additional operating cost $80 million in total to ready our viasat three ground network for the service entry in place.

Speaker Change: <unk> three <unk>.

Speaker Change: Recall as well that fiscal 'twenty five benefited from very high end lucrative palace, where royalty revenues and we do not expect these revenues to continue at the rates, we realized in fiscal 'twenty five.

Garrett Chase: Offsetting these items are growth in our Aviation, Government, SATCOM, and DAT franchises, along with about $40 million reduced operating costs from our Fiscal 25 Voluntary Retirement Program. While we continue to expect top-line growth, double-digit cash flow growth, and free cash flow inflection, our adjusted EBITDA guidance is slightly reduced from prior, and the reason is that Fiscal 26 has begun with headwinds in our aviation business, from continued OEM delivery delays, and increases in aircraft out of service as our customer space declines in traffic flow. Our annualized exposure to current tariffs is relatively minor at $25 million, but we've already been affected by a portion of that amount.

Speaker Change: Offsetting these items our growth in our aviation government Satcom, and DAP franchises, along with about $40 million reduced operating costs from our fiscal 'twenty five voluntary retirement program.

Speaker Change: While we continue to expect top line growth double digit op cash flow growth and free cash flow inflection our adjusted EBITDA guidance is slightly reduced from prior and the reason is that fiscal 'twenty six has begun with headwinds in our aviation business from continued OEM delivery delays and increases in aircraft out of service as our customers faced declines in profit.

Speaker Change: Yes.

Speaker Change: Our annualized exposure to current tariffs was relatively minor at $25 million.

We've already been affected by a portion of that amount, where we fall in the guidance range will depend largely on how the remainder of the year progresses on these macro fronts.

Garrett Chase: Where we fall in the guidance range will depend largely on how the remainder of the year progresses on these macro fronts. Regardless of how much or little impact we face from the macro headwinds, we expect to deliver on some critical outcomes that help our fiscal 26 results, but more importantly, position us for higher growth levels in the years ahead. Meaningful growth in our capacity with the launches of flights two and three of our ViaSat-3 constellation and targeted integration of third party capacity. Continued growth in our AviationGovernments.com and DAS franchises. A return to growth in our maritime business.

Speaker Change: Regardless of how much or little impact we face on the macro headwinds, we expect to deliver on some critical outcomes that help our fiscal <unk> results.

Speaker Change: More importantly position us for higher growth levels in the years ahead meaningful growth in our capacity with the launches of slides two and three of our Viasat three constellation and targeted integration of third party capacity continued growth in our aviation and government Satcom and DAP franchises, a return to growth in our maritime business and.

Garrett Chase: And a bottoming out of our fixed services franchise with capacity ViaSat-3 Flight 2 is expected to bring. We've started the year facing risks to our EBITDA outlook, but our confidence in achieving sustained free cash flow generation by the second half remains high. The business momentum we create during the year, combined with reduced capital requirements following the launch of ViaSat III, position us for meaningful free cash flow growth in the years beyond Fiscal 26. During Fiscal 26, we'll maintain our focus on capital efficiency and reducing the capital intensity of our business model. and have confidence our CapEx for the year will be about $1.3 billion, inclusive of $250 million for the completion of the ViaSat-3 constellation.

Speaker Change: A bottoming out of our fixed services franchise with capacity Viasat three slide two is expected to bring.

Speaker Change: We started the year facing risks to our EBITDA outlook, but our confidence in achieving sustained free cash flow generation by the second half remains high the business momentum we create during the year combined with reduced capital requirements. Following the launch of Viasat three position us for meaningful free cash flow growth in the years beyond fiscal 'twenty three.

Speaker Change: Fiscal 'twenty six we will maintain our focus on capital efficiency and reducing the capital intensity of our business model.

Speaker Change: And have confidence our capex for the year will be about $1 3 billion inclusive of $250 million for the completion of the Viasat three constellation.

Speaker Change: Our cash focus hasn't been limited to EBITDA and Capex fiscal 'twenty five we generated more than $900 million of operating cash flow more than 30% growth from fiscal 'twenty four.

Garrett Chase: Our cash focus hasn't been limited to EBITDA and CapEx. Fiscal 25, we generated more than $900 million of operating cash flow, more than 30% growth since Fiscal 24. Our teams are sharpening their focus on key elements of our working capital, and when combined with less severance and restructuring related charges, we expect operating cash flow growth to again be solidly in the double digits during fiscal 26. The additional steps we're taking to streamline our organization and take better advantage of integration and other portfolio opportunities will make us more nimble and competitive while driving growth and expanding margins.

Our teams are sharpening our focus on key elements of our working capital and when combined with less severance and restructuring related charges. We expect operating cash flow growth to again be solidly in the double digits during fiscal 'twenty six.

Speaker Change: The additional steps, we're taking to streamline our organization and take better advantage of integration and other portfolio opportunities will make us more nimble and competitive while driving growth and expanding margins.

Garrett Chase: Our focus for this process will be in accessing more network synergies to better share capacity that will reduce future capex, better leveraging our combined scale to drive sourcing and non-labor savings, rationalizing our spend with third-party staffing contractors, and simplifying our work processes so we can operate with high velocity, take advantage of normal attrition rates to boost operating leverage. The fiscal 26 impact will be negligible, but we see the sum of these opportunities boosting margins by an incremental 200 basis points or more over a three-year horizon.

Speaker Change: Our focus for this process will be in accessing more network synergy is to better share capacity that will reduce future capex better leveraging our combined scale to drive sourcing and non labor savings rationalizing our spend with third party staffing contractors and simplifying our work processes. So we can operate with high velocity take advantage of normal attrition rates.

Speaker Change: Boost operating leverage for fiscal 'twenty, six impact will be negligible, but we see the some of these opportunities boosting margins by an incremental 200 basis points or more over a three year horizon.

Garrett Chase: Now, let me add a little flavor on how we see our businesses developing through the year. We expect Fiscal 26 will see continued growth in both our aviation sub-segments, despite the macro headwinds noted. The team's been working to deliver improving customer experiences in the integration of third-party capacity through the year to support even higher service levels as our demand continues to grow. We continue to develop OMARA, our next-generation IFC multi-network solution and multi-orbit roadmap that will deliver the best customer experiences for the future. OMARA will leverage the unique experiences and economics that a blend of LEO and GEO capacity can deliver, including network redundancy and guaranteed quality of experience, flexible business models, and industry-leading digital offerings.

Speaker Change: Now, let me add a little flavor on how we see our businesses developing through the year, we expect fiscal 'twenty six we'll see continued growth in both our aviation sub segments. Despite the macro headwinds noted.

Speaker Change: The teams are working to deliver improving customer experiences and the integration of third party capacity through the year to support even higher service levels as our demand continues to grow.

Speaker Change: We continue to develop Amara, our next generation IFC multi network solution and multi orbit roadmap that will deliver the best customer experiences for the future.

Speaker Change: Laura will leverage the unique experiences and economics that a blend of Leo and Geo capacity can deliver including network redundancy and guaranteed quality of experience flexible business models and industry, leading digital offerings.

Speaker Change: As Mark mentioned, we signed a multiyear agreement with Telesat Leo capacity and we're hard at work developing a proprietary electronically steered antenna terminal viasat era that will seamlessly integrate capacity from multiple bands and orbitz to deliver superior experiences and government satcom, we should see sustained higher levels of activity in <unk>.

Garrett Chase: As Mark mentioned, we signed a multi-year agreement with Telesat for LEO capacity and we're hard at work developing a proprietary, electronically-steered antenna terminal, ViaSat-ERA, that will seamlessly integrate capacity from multiple bands and orbits to deliver superior experience. In government SAT comps, we should see sustained higher levels of activity and margin expansion on a higher margin business mix, including the use of the valuable steerable beams we have on our GX fleet. While much of our business is in backlog for fiscal 26, recent new awards and renewals are encouraging the future. Nexus Wave product performance has been strong and the services are performing well.

<unk> expansion on our higher margin business mix, including the use of the valuable <unk> beams, we have on our <unk>, while much of our business is in backlog for fiscal 2000, and recent new awards and renewals are encouraging the future.

Speaker Change: Next wave product performance has been strong and the services are performing well I'm proud of the marathon team for their work in developing a multi <unk> solution that will meet growing customer needs for the future.

Garrett Chase: I'm proud of the Maritime team for their work in developing a multi-orbit solution that will meet growing customer needs for the future. We plan to increase the rate of installations and expect to drive slight sequential growth in Maritime revenue in the first quarter of fiscal 26. Year-over-year growth is expected late in the fiscal year. In Fixed Broadband, Flight 2 will be pivotal to turning the tide, but we're not waiting. In advance, we're testing new offerings and targeting areas where we have available capacity, which is helping to stabilize gross ads and reduce churn. Continued subscriber pressure is expected in Fiscal 26, but with Flight 2's service entry, we expect this business to stabilize by year-end with an ability to grow beyond the year.

Speaker Change: We plan to increase the rate of installations and expect to drive slight sequential growth in maritime revenue in the first quarter of fiscal 2000 year over year growth is expected late in the fiscal year.

Speaker Change: In fixed broadband flight will be pivotal to turning the tide, but we're not waiting in advance we're testing new offerings and targeting areas, where we have available capacity, which is helping to stabilize gross adds and reduce churn continued subscriber pressure is expected in fiscal 'twenty six but we'll fight to service center, we expect this business to stabilize by <unk>.

Speaker Change: Year end with an ability to grow beyond the year.

Garrett Chase: In GAP, we expect another year, double-digit growth in revenues driven by information security and space mission. We're competing for the next generation encryption market, where we'll leverage our current capabilities along with new technologies to provide high assurance encryption from the tactical edge and cloud connectivity while looking to expand into space. During Fiscal 26, we expect growth in our InfoSec and cyber business to meaningfully outpace overall DAT segment revenue growth. We expect more normalized levels of royalty revenues at TrellisWare and Fiscal 26, and as a result, DAP adjusted EBITDA growth we expect will be less than revenue growth.

Speaker Change: And GAAP, we expect another year double digit growth in revenues driven by information security and space in mission systems.

Speaker Change: Competing for the next generation encryption market, where we will leverage our current capabilities along with new technologies to provide high assurance encryption from the tactical edge and cloud connectivity, while looking to expand into space during fiscal 'twenty six we expect growth in our <unk> cyber business to meaningfully outpace overall that segment revenue growth.

Speaker Change: We expect more normalized levels of royalty revenues at <unk> were in fiscal 'twenty and as a result, GAAP adjusted EBITDA growth, we expect will be less than revenue growth absent the <unk> impact that margins would be improving.

Garrett Chase: Absent the TrellisWare impact, DAP margins would be improving.

Garrett Chase: I'll turn now to how we're thinking about addressing our debt. Our two-step plan is to begin using available cash to redeem near-term maturity, and then to leverage the momentum we built during Fiscal 26 to address our longer-term debt structure. Any potential proceeds from our strategic review or legato will be prioritized for debt repayment, which may accelerate our process. At quarter end, we carried available cash of $1.6 billion at the consolidated level. We've begun using that liquidity to early redeem some of our outstanding debt. Following quarter end, we redeemed the remainder of our 25 notes for $443 million.

Speaker Change: I'll turn now to how we're thinking about addressing our debt. Our two step plan is to begin using available cash to redeem near term maturities and then the leverage the momentum we built during fiscal 'twenty six to address our longer term debt structure any potential proceeds from our strategic review, our legato will be prioritized for debt repayment, which may accelerate our process at.

Speaker Change: Quarter end, we carried available cash of $1 6 billion at the consolidated level, we've begun using that liquidity to early redeem some of our outstanding debt.

Speaker Change: Following quarter end, we redeemed the remainder of our 25 notes for $443 million during.

Garrett Chase: During fiscal 26, with confidence in sustained cash flow generation by year end, we expect to pay down the remainder of the MRSAT term loan fee of about $300 million from available cash. With the business momentum we expect to build in Fiscal 26, we'll be well positioned to grow our earnings and free cash flow in the years ahead. As we exit the fiscal year, we'll begin work to address our longer-term maturities and expect to have a variety of compelling options to do so.

Speaker Change: During fiscal 'twenty sex with confidence in sustained cash flow generation by year end, we expect to pay down the remainder of the Mr's at term loan b of about $300 million from available cash.

Speaker Change: With the business momentum, we expect to build in fiscal 'twenty, six will be well positioned to grow earnings and free cash flow in the years ahead as we exit the fiscal year will begin work to address our longer term maturities and expect to have a variety of compelling options to do so as we get closer to the end of the fiscal year, we will provide some additional direction as to our objectives and antenna.

Garrett Chase: As we get closer to the end of the fiscal year, we'll provide some additional direction as to our objectives and intent. As part of managing through this transitory period of elevated capital spending, primarily within the ViaSat silo, and as we approach sustained free cash flow, we expect to upstream approximately $400 to $500 million of cash from our InMarsat debt silo up to the ViaSat level. We want to be transparent about the total quantum expected, but this process should play out over time, beginning most likely in the next quarter or so.

Speaker Change: As part of managing through this transitory period of elevated capital spending primarily within the Viasat silo and as we approach sustained free cash flow, we expect upstream approximately $400 million to $500 million of cash from our inmarsat that silo up to the bias that level, we want to be transparent about the total quantum expected that this process should.

Speaker Change: Play out over time, beginning most likely in the next quarter or so.

Garrett Chase: In conclusion, I hope you now understand why I'm so excited for the opportunities ahead of us in Fiscal 26. Key outcomes for the year will be modest revenue growth, flattish adjusted EBITDA, and free cash flow inflection later in the year. But those outcomes mask a much more meaningful transformation in our business. We look to emerge from Fiscal 26 with substantially more capacity to deliver for our customers in the years ahead. We expect continued growth in key parts of our business and trends in some of the areas that have been weighing on near-term results to bottom or return to growth.

Speaker Change: In conclusion I hope you now understand why I'm. So excited for the opportunities ahead of us in fiscal 'twenty.

Speaker Change: Key outcomes for the year will be modest revenue growth flattish flattish adjusted EBITDA and free cash flow inflection later in the year, but those outcomes mask a much more meaningful transformation in our business, we look to emerge from fiscal 'twenty six with substantially more capacity to deliver for our customers in the years ahead, we expect continued growth in key part.

Speaker Change: <unk> of our business and trends in some of the areas that have been weighing on near term results to bottom or returned to growth the positioning of our franchises for sustained and profitable growth in combination with easing capital requirements. Following the launch of Viasat three.

Garrett Chase: The positioning of our franchises for sustained and profitable growth, in combination with easing capital requirements following the launch of ViaSat-3, lead us to expect rising free cash flow in the years ahead. Against that backdrop, we'll look to begin refinancing and optimizing our debt structure for the future. I'm excited to be part of the ViaSat team as we work to realize all our opportunities in fiscal 26.

Speaker Change: Lead us to expect rising free cash flow in the years ahead.

Speaker Change: Against that backdrop, we will look to begin refinancing and optimizing our debt structure for the future I.

Speaker Change: I am excited to be part of the <unk> team as we work to realize all our opportunities in fiscal 'twenty six.

Franz: And with that operator, I'll turn the call back to you to begin the Q&A. Thank you.

Speaker Change: And with that operator, I will turn the call back to you to begin the Q&A.

Speaker Change: Thank you we will now begin the question and answer session. At this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad, we will just pause for a moment to compile the Q&A roster.

Franz: We will now begin the question and answer session. At this time, I would like to remind everyone in order to ask a question, press star, then the number one on your telephone keypad. We will just pause for a moment to compile the Q&A roster.

Speaker Change: Your first question comes from the line of Sebastiana Petti with Jpmorgan. Your line is open.

Sebastiano Petti: Your first question comes from the line of Sebastiano Petti with JP Morgan. Your line is open. Hi, thank you for taking the question. And thanks for all the color there at a segment level. Super helpful. I was wondering if you could update us.

Sebastiana Petti: Hi, Thank you for taking the question and thanks for all the color there at a segment level Super helpful. I was wondering if you could update us I don't know if you touched upon it in your prepared remarks, but any update on the process. The strategic review process for the defense and advanced technologies segment.

Mark Stankberg: I don't know if you touched upon in your prepared remarks, but any update on the process, the strategic review process for the defense and advanced technology segment. I think that's something you guys have alluded to in subsequent quarters. Wanted to know if any update there, how you guys are thinking about that. Is that process still ongoing? Perhaps any update on timing? would be super helpful.

Sebastiana Petti: I think thats something that you guys have alluded to in the subsequent quarters wanted to know if any.

Sebastiana Petti: Any update there on how you guys are thinking about that is thats process still ongoing.

Sebastiana Petti: Perhaps any update on timing.

Sebastiana Petti: So it would be Super helpful. And then I guess just in regards to the satellite launch for <unk> I guess, what gives you confidence to early 2026 at this point.

Mark Stankberg: And then I guess just in regards to the satellite launch for F2, I guess what gives you confidence that early 2026 at this point, and is part of the software, perhaps EBITDA, you did touch upon getting additional ground network costs in as part of the software EBITDA guide than previously anticipated a function of just having to wear more of those ground network costs before getting kind of any revenue benefits from there. That would be super helpful if you can comment. Thank Okay, sure. Thanks.

And.

Sebastiana Petti: As part of the software, perhaps EBITDA you did touch upon getting additional ground network cost and it's part of the softer EBITDA guide than previous anticipate and previously anticipated a function of just having to where more of those ground network costs before getting kind of any revenue benefits in there that would be super helpful. Thank.

Sebastiana Petti: Thank you.

Sebastiana Petti: Okay sure.

Mark Stankberg: I'll take your questions in order. On the defense and strategic review that is still underway, things, you know, the way I put it is that business is doing really well, so we're constantly assessing. What we think the value of each part of those businesses are relative to what our expectations are of their future cash flows, and I think they're evolving favorably. We are also at the same time looking at ways in which some of the things that fall out of that evaluation that are things that we can do to enhance their value and their competitiveness, we're doing those at the same time.

Sebastiana Petti: Sure. Thanks.

Sebastiana Petti: Ill take your questions in order.

Sebastiana Petti: Fence and strategic review.

Sebastiana Petti: That is still underway.

Sebastiana Petti: Thanks.

Sebastiana Petti: The.

Sebastiana Petti: But it is that business is doing really well so we are constantly.

Sebastiana Petti: Assessing.

Sebastiana Petti: What the what we think the value of that of each part of those businesses are relative to what are our expectations are of their future cash flows.

And.

Sebastiana Petti: They are evolving favorably we are also at the same time.

Looking at ways in which some of the things that fall out of that evaluation.

Sebastiana Petti: Things that we can do to enhance their value and their competitiveness. We're doing those at the same time.

Mark Stankberg: But the review is still underway, and I think you should just look for us to make any statements if there's any material change in how we're thinking about that. Second part on Flight 2 schedule, remember a lot of what's been going on over the last couple of years has really been about understanding the source of the anomaly and the corrective action process. That's where a lot of the uncertainty has been. We're reaching the conclusion of that. That entire reflector subassembly will be delivered to the spacecraft prime fairly soon and then it's a lot more straightforward and we're going through processes that we already did on Flight 1 in terms of spacecraft integration.

Sebastiana Petti: The review still.

Sebastiana Petti: Underway and.

Speaker Change: I think you should just look for us to make any statements if theres any material change in how are we thinking about that.

Sebastiana Petti: Second part.

Speaker Change: Quite to schedule.

Speaker Change: A lot of what's been going on over the last couple of years has really been about understanding the source of the anomaly and the corrective action process, that's where a lot of the uncertainty has been we're reaching that drew the conclusion that the.

Speaker Change: That entire receptor sub assemblies.

Speaker Change: Delivered to the spacecraft prime fairly soon and then there is a lot more straightforward.

Speaker Change: And we're going through processes that we already did on five one turns a spacecraft integration.

Mark Stankberg: We're still on track to deliver the complete satellite to the launch site this summer as we expected before. Well, you know, right now.

Speaker Change: We're still on track to deliver.

Speaker Change: Satellite completed satellites to the launch site this summer as we expected before.

Speaker Change: And.

Speaker Change: Well right now.

Mark Stankberg: Our focus having been on delivering the satellite, we're also looking at What the activities will be post-delivery, there's a variety of activities in there, some of which, you know, are kind of beyond our control, so we felt it was prudent just to update investors and let them know that there was some probability that it could fall into early Outlook as a result of that.

With our focus having been on delivering the satellite.

Speaker Change: Also looking at.

Speaker Change: What what the activities will be post delivery.

Speaker Change: Theres a variety of activities there are some liquids.

Speaker Change: Beyond our control. So we felt it was prudent just to update investors and let them know that there is some.

Speaker Change: Some probability that it could fall into early.

Speaker Change: Calendar 'twenty six.

Speaker Change: We would remind you of is that part of the reason that we use satellite in service in the in.

Speaker Change: In our roadmap is that's really what defines what it how it is going to affect.

Speaker Change: Our financial outlook.

Speaker Change: There's really no material change to our financial outlook.

Speaker Change: Outlook as a result of that.

Garrett Chase: That's it for the third point on the EBITDA.

Gary: For the third point on the EBITDA, but Gary.

Garrett Chase: Gary, can you address that one? Yeah, we'd actually previewed that I think a quarter prior, so there's no impact from the ground network boss you were referencing, that was...

Speaker Change: Yes.

Speaker Change: We had actually reviewed that number I think the quarter. Prior so there's no impact from the ground network Pos youre referencing that was not a driver in the guidance.

Speaker Change: Yes.

Garrett Chase: Thanks, everybody.

Speaker Change: Right.

Speaker Change: Your next question comes from.

Rick Prentiss: Your next question comes from the left. comes from the line of Rick Prentiss with Raymond James. Your line is open. Thanks. Good afternoon, everybody. A couple questions, can you hear me okay? Yep. Okay, great.

Speaker Change: Comes from the line of Ric Prentiss with Raymond James Your line is open.

Speaker Change: Thanks, Good afternoon everybody.

Speaker Change: Couple questions can you hear me okay.

Speaker Change: Yes.

Speaker Change: Okay great.

Garrett Chase: First question, obviously, you can't talk a lot about Legato, but is there some timeline you can at least actually kind of lay out for us of what we should be watching on the timeline of Legato? Is there any way to put some goalposts around what the magnitude might be? And I think, Gary, you mentioned if there were proceeds, it would most likely go towards delevering. Then I've got a follow-up. Oh, okay. You know, we are we are Participating in a litigation, you know, one of the main things that we would refer investors to, and analysts as well, is just to look through the public record.

Speaker Change: Great.

Speaker Change: First question, obviously, you can't talk a lot about legato, but is there. Some timeline you can at least fashion, we kind of lay out for us of what we should be watching on the timeline of legato is there any way to put some goalposts around what the magnitude might be and I think Gary you mentioned.

Speaker Change: This award proceedings, most likely go towards Delevering and I've got a follow up.

Speaker Change: Okay.

Speaker Change: We are.

Speaker Change: Here's a painting litigation.

Speaker Change: One of the main things that we would.

Speaker Change: Refer investors to and then Hersh.

Speaker Change: Well, it's just the two.

Speaker Change: Through the public record and its in the docket and you can get a little bit of a sense of how things are progressing.

Garrett Chase: It's in the docket, and you can get a little bit of sense of how things are progressing. Just in terms of, you know, what, what's at stake, and what, you know, is upside for us is, it's also part of the public record that you have, you know, that the amount of cash that we're owed is in excess of $500 million. And that, according to the bankruptcy plan, the entity intends to consummate the transaction that that's based on. So those are the things that we're working towards. But it's hard. It's very difficult for us to comment any further than that at this point.

Speaker Change: Just in terms of what what's at stake and what.

Speaker Change: Upside for us as it is also part of the public record that.

Speaker Change: Yes.

Speaker Change: The amount of cash that where it is in excess of $500 million.

Speaker Change: And that according to the bankruptcy plan B.

Speaker Change: Yes.

Speaker Change: Entity intends to consummate the transaction.

Speaker Change: That's based on so those are the things that we're working towards.

Speaker Change: It's hard.

Speaker Change: Very difficult for us to comment any further to that at this point.

Garrett Chase: And anything as far as magnitude? Well, the main the main thing I say is just, you know, I think the thing to keep in mind is what's what the amount that we're owed, which is a matter of public record. So that's That's something to, you know, it's just a way to frame the problem. Yeah. Okay. Yeah. Thanks. And Gary, you mentioned proceeds might go to de-levering.

Speaker Change: And anything as far as magnitude.

Speaker Change: But the main thing I'd say is just I think the thing to keep in mind as well.

Speaker Change: The amount that were owed which is about.

Speaker Change: It's a matter of public record so.

Speaker Change: Something too.

It's just the way to frame the problem.

Speaker Change: Yes.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Thanks, Nick.

Nick: Yeah, and Gary you mentioned proceeds might go to Delevering is there kind of a target zone of where you'd like to see leverage to get to over the next couple of years given legato given potential.

Garrett Chase: Is there kind of a target zone of where you'd like to see leverage get to over the next couple of years, given legato, given potential unlocking a portfolio value? Well, yeah, let's start with lower, which is what we're working on urgently. You know, I think we've done the research on this. And I think as is consistent with a lot of asset intensive businesses, when you when you get to around three times, that's where two things start to happen. You know, that's where first of all, your cost of debt capital starts to flatten out and where equity value is maximized.

Speaker Change: The portfolio value.

Speaker Change: Well, yeah, let's start with lower which is what we're working on urgent.

Speaker Change: I think we've done the research on this and I think as is consistent with a lot of asset intensive businesses. When you when you get to around three times, that's where two things start to happen.

Speaker Change: That's where our first of all your cost of debt capital starts to flatten out and where equity value is maximized.

Garrett Chase: So clearly, that is a an initial resting point, we're working at least to get there. And I think once once we get there, you know, we'll, we'll see what what we want to do next. What you see from us, though, is, you know, again, we're acting today, we're not necessarily trying to be scientific about it, we're working as hard as we can to drive free cash flow, which is the best way for us to get there.

Speaker Change: So clearly that is an.

Speaker Change: An initial resting point, we're working at least to get there.

Speaker Change: Once we get there we'll see what what.

Speaker Change: We want to do next what Youll see from US, though is again, we are acting today, we're not necessarily trying to be scientific about it we're working as hard as we can to drive free cash flow, which is the best way for us to get there.

Speaker Change: Okay and last one for me obviously the airlines are looking at solutions for inflight connectivity, particularly free Wi Fi.

Mark Stankberg: Okay, last one for me. Obviously, airlines are looking at solutions for in-flight connectivity, particularly free Wi-Fi. We've been hearing from some of the airlines that the ViaSat solution for the narrowbody is really good, Starlink isn't as well, but there's some debate on the widebody. Have you been hearing anything similar from the airline customers of where Starlink might have a solution that they feel is more competitive in a widebody versus narrowbody? But just kind of update a little bit there. I know you posted something with the presentation today, but it's something we've just been hearing from airlines is narrowbody versus widebody and LEO versus GEO.

Speaker Change: Are you hearing from some of the.

Speaker Change: Airlines.

Speaker Change: The <unk> solution for the narrow body is really good sterling isn't as well, but there is some debate on the wide body have you heard anything similar from the airline customers of where sterling might have a solution that they feel is more competitive.

Speaker Change: Mid body versus narrow body, but just kind of update a little bit there I know you've posted something with a presentation day, but it's something we've just been hearing from airlines is narrow body versus wide body and layout versus June.

Mark Stankberg: The, okay, so that's a good question. We, you know, one of the things that we have really been emphasizing with our airline customers are quantitative metrics of performance for all their flights. And those metrics, you know, can vary depending on routes and they can vary depending on, or think of it as, big thing with wide bodies is the number of people on board which leads to the number of users. So, we, you know, we've been pretty focused, and actually we re-record and we can sort those metrics multiple ways, by route, by fleet type, and by wide body versus narrow body.

Speaker Change: Yep.

Speaker Change: Okay. So that's a good question one of the things that we've really been emphasizing with our airline customers are quantitative metrics of performance.

Speaker Change: For all of their flights.

Speaker Change: Those metrics can vary depending on routes and they can vary depending on.

Speaker Change: Think of it as we'll pick thing with wide bodies as the number of people onboard which leads to the number of users. So.

Speaker Change: We've been pretty focused.

Speaker Change: And we've actually we.

Speaker Change: We record and we can sort those metrics.

Speaker Change: Arrays by route by fleet type and by wide body versus narrow body. So.

Mark Stankberg: So, I think it's a fair question. I tell you our data is such right now that for wide bodies and narrow bodies our performance is very. Okay, narrow bodies, a little bit easier. But the, if you look at the thresholds that, you know, our most knowledgeable customers have set, we're, we're meeting those thresholds for both types of planes. The other thing that I bring up here, and we talked a little bit about, well, we mentioned some of the survey results that we got for our ViaSat-3 Flight 1. And one of the really good things about that ViaSat-3 architecture is that we have beams that follow each plane individually.

Speaker Change: I think that I think it's a fair question I would tell you our data as such right now that for wide bodies narrow bodies are performance is very close okay narrow bodies, a little bit easier.

Speaker Change: If you look at the threshold Scott.

Speaker Change: Our most knowledgeable customers have set.

Speaker Change: We're meeting those thresholds for both types of planes.

Other thing.

Speaker Change: Bring up here and talk a little bit about we mentioned some of the <unk>.

Speaker Change: Survey results that we got or.

Speaker Change: Our viasat three one.

Speaker Change: One of the one of the really good things about Viasat three architecture is that we we have beams that follow each plane individually.

Mark Stankberg: So the amount of bandwidth that we can put into those beams is certainly sufficient to serve the largest wide bodies with free offering. So that's, you know, we've given, we have some of our global customers that are already flying on ViaSat-3 with wide bodies. They're seeing those results. I can tell you the customers that we're working with are very pleased with our results with ViaSat-3. One of the points that we like to make is that not all gigabits or not all terabits are the same. Those, you get lots of points for the gigabits that happen to be right over the, or right on, the planes that are being served.

Speaker Change: So the amount of bandwidth that we can put into those beams is there is certainly sufficient to sort of.

Speaker Change: The largest wide bodies with a free offering.

Speaker Change: So thats.

Speaker Change: Given.

Speaker Change: We have some of our.

Speaker Change: Global customers that are already flying on Viasat three with wide bodies. They are seeing those results I can tell you the.

Speaker Change: <unk> that we're working with.

Speaker Change: Very pleased with our results with Viasat three.

Speaker Change: One of the points that we like to make is that not all gigabit sort of not all terabytes.

Speaker Change: Or are the same.

You get lots of points for the gigabit centers happen to be right over the right on the planes that are being served that's the whole point of what we're doing with our new satellites.

Mark Stankberg: That's the whole point of what we're doing with our new satellite. Great.

Mark King: Alright Thats helpful. Thanks, Mark.

Mark Stankberg: That's helpful.

Mark Stankberg: Thanks, Mark. You're next.

Speaker Change: Thanks, Greg.

Speaker Change: Your next question comes from the line of Edison you with Deutsche Bank. Your line is open.

Edison Yu: Your next question comes from the line of Edison Yu with Deutsche Bank. Your line is open. Hey, thank you. First question, Mark, maybe a longer term one, you mentioned in the prepared remarks, you are, you know, playing to wit. And I'm wondering, what exactly does that really mean? If we think about, you know, two, three, four years from now, what ViaSat? Is that, you know, purely financial? Is it, you know, maybe getting back some of these, you know, market share? And I see maritime, what is that look exactly to you winning? Well, the big thing that we're looking for is growth, right?

Edison: Hey, Thank you.

Speaker Change: First question for Mark maybe a longer term one you mentioned in the prepared remarks, you are playing to win.

Speaker Change: And I'm wondering what exactly does that really mean, if we think about 234 years from now.

Speaker Change: It looks like is that purely financial is it.

Speaker Change: Maybe getting back some of these market share.

Speaker Change: And IFC Maritime what is that look exactly to you winning.

Speaker Change: Well.

Speaker Change: Big thing that we're looking forward is growth right.

Mark Stankberg: We're looking, winning is growth. Okay, for us. I think that The markets that we're focused on still have a lot of growth in them. We've had very... You think about how that, you know, that's part of what we're talking about measuring the Hawaii route. This is interesting because as we bring more bandwidth... to market. You know, we will have lots of bandwidth to apply to our customers in these mobility markets. That's our main emphasis, which includes government, aviation, maritime, and we expect to extend that into land mobile. And then, so then the big, you know, the way the competition actually plays out is once you're in an environment where you have unlimited free Wi-Fi for your customers, really the main issue then is who runs out of bandwidth.

Speaker Change: Winning is growth okay for us I think that.

Speaker Change: The markets that we're focused on and still have a lot of growth in them.

Speaker Change: We've had.

Speaker Change: Barry.

Speaker Change: Strong market shares in both commercial aviation and maritime.

Speaker Change: A tough benchmark benchmarks to try to.

Speaker Change: To improve on as those markets grow.

Speaker Change: We're really focused on growth I think will do well in market share, but the big thing I think the big thing there.

Speaker Change: We'd like to communicate is it's becoming more and more evident that this is really an economic competition right that we can deliver the levels of service that people want.

Speaker Change: Think about how that.

Speaker Change: That's part of what we're talking about measuring the Hawaii routes.

Speaker Change: Which is interesting because as we bring more bandwidth to.

Speaker Change: The market.

Speaker Change: We will have lots of bandwidth to apply to our customers.

Speaker Change: In these mobility markets.

Speaker Change: Our main emphasis which includes government aviation maritime and we expect to extend that into land mobile and then so then the big one.

Speaker Change: Wave of competition actually plays out.

Speaker Change: Once you're in an environment.

Speaker Change: Where you have.

Speaker Change: Unlimited free Wi Fi for your customers really good the main issue than it is who runs out of bandwidth.

Mark Stankberg: You just don't, you don't, as long as you don't run out of bandwidth, customers are really happy. So one of the things that we have emphasized for quite a few years is understanding what those geographic and temporal patterns are of demand. And that's what we're, that's what we're intending to serve. That's going to let us compete really effectively. The other part of it is, you know, once you know. What kind of the market pricing is in these markets, whether it's like per boarded passenger, per ship, you can work backwards and figure out what it takes to be able to serve those price points at a And so that's one of the things that we've been really focused on as well is having sufficient bandwidth every place and being able to be able to blend our own bandwidth with third-party bandwidth, match the utilization between supply and demand, and compete.

Just as.

Speaker Change: As long as you don't run out of bandwidth customers are really happy.

Speaker Change: One of the things that we have emphasized for quite a few years is understanding what those geographic and Tim floral patterns are of demand.

Speaker Change: And that's what we're that's what we're intending to serve that is going to let us compete really effectively the other part of it as well.

Speaker Change: Once you know.

Speaker Change: What kind of market pricing is in these markets, whether it's like per boarded passenger per ship.

Speaker Change: Can work backwards and figure out what it takes to be able to serve those price points at a profit.

Speaker Change: So that's one of the things that we've been really focused on as well as having sufficient bandwidth every place.

Speaker Change: And being able to.

Speaker Change: The blend our own bandwidth with third party bandwidth matched the utilization between supply and demand.

Mark Stankberg: So that's part of the playing to win. So the last part of it that is, I think, really important is one of the distinctions in the way we do free for airlines versus the way some others do is that we give the airlines discretion about how to do that. We provide all the platforms that really give them control over the experience. So you'll see as an example in the quote that we have for American Airlines, they want to be able to provide those incentives to their best customers, right? And the airlines get advantages by having those customers be members of their frequent flyer program, for instance.

Speaker Change: So that's part of the playing to win the vast part of it.

Speaker Change: That is I think really important as well.

Speaker Change: One of the distinctions.

Speaker Change: <unk>.

Speaker Change: The way, we do free for airlines versus the way some others do is that we give the airlines discretion about how to do that we provide all of the platforms that really give them control over the experience and so you'll see it as an example in the <unk>.

Speaker Change: Note that we have for American Airlines.

Speaker Change: They want to be able to provide those incentives to their best customers. The airlines get advantages by having those customers be members of the frequent flyer program and so we give them the tools to manage other communication.

Mark Stankberg: So we give them the tools to manage all their communication and their connectivity and their entertainment in a way that basically monetize them and to come out with a better overall economic solution in an environment where the passengers still get free Wi-Fi. So those are – and that's really an example of non-price value. It's right. That's a way that we're really helping the airlines do that. We have very similar strategies in the way we work with our maritime customers.

Speaker Change: They're they're connectivity in their entertainment in a way that helps them.

That basically monetize them and to come out with a better overall economic solution in an environment, where the passengers still get through Wi Fi. So those are that's.

Speaker Change: Really an example.

Speaker Change: Non price value is right. That's the way that we're really helping the airlines.

Speaker Change: Do that.

Speaker Change: We have very similar strategies.

Speaker Change: And the way, we work with our maritime customers and government.

Mark Stankberg: But I know it's a long answer, but I just wanted to give you a sense of what it means for us to win and that we feel we have a path to being able to do that as we complete some of the items that we've been working on for quite a while.

Speaker Change: I know, it's a long answer but.

Speaker Change: I just wanted to give you a sense of book.

Speaker Change: What it means for us to win and that we feel we have a path to being able to do that as we complete some of that.

Speaker Change: Items that we've been working on for quite a while.

Speaker Change: Understood I appreciate the.

Mark Stankberg: I appreciate the comprehensive response. Follow up on the on the L band. Obviously, you know, you have a lot of it. And, you know, you've articulated earlier on your on your desire to get more involved in an amazing way D to D. But I think you would probably agree that the providers or the D2D people trying to do D2D to competitors is already pretty crowded. And many of them have much lower cost of capital, while at the same time, spectrum is very scary. So, what kind of conditions would you need to see to maybe try to monetize the actual spectrum itself, as opposed to trying to utilize it for a service?

Speaker Change: The comprehensive response.

Speaker Change: A follow up on the on the L band.

Speaker Change: You have a.

Speaker Change: A lot of it and you've articulated earlier on your on your desire to get more involved in an even way DDD.

Speaker Change: But I think.

Speaker Change: We agree that that the providers or the <unk> people are trying to do in data competitors is already pretty crowded and many of them have much lower cost of capital.

Speaker Change: While at the same time spectrum.

It's a very scarce.

Speaker Change: So what kind of conditions would you need to see to maybe try to monetize actual spectrum itself.

Speaker Change: As opposed to trying to utilize it for service.

Speaker Change: Okay. So there's a lot of it.

Mark Stankberg: Okay, so there's a lot in there. Here's what we'd say. One is, from our perspective, one of the good, good things is we have a pretty significant existing business space in L band with mobile satellites. One of the, you know, I think one of, I think it's becoming more clear that having licensed satellite spectrum is really valuable. And it's, it's kind of, it's essential in performing the public safety missions that we do. Right now, lots of emphasis on aeronautical safety. That's one of our important missions. More and more emphasis on maritime safety, certainly national security applications.

Speaker Change: What we would say one is from.

Speaker Change: From our perspective, one of the good good things is we have a pretty significant existing business base bandwidth mobile satellite services one of the I think one of them.

Speaker Change: I think it's becoming more clear that having license satellite spectrum is really valuable.

Speaker Change: It's essential and performing.

Speaker Change: Public safety.

Missions that we do in Europe, but right now lots of emphasis on aeronautical safety is one of our important mission more and more emphasis on maritime safety certainly national security applications all of those things benefit from.

Mark Stankberg: All those things benefit from, from licensed satellite spectrum. It's also clear that there can be crossover benefits into, into these D to D markets with that as well. But one of the points I want to make is that because of the public service obligations that we have, or the public interest obligations that we have, which we take seriously, you know, being able to evolve those to, you know, to what their future requirements is, we think is important. We're undertaking that. I think it's, it's a, It's a good foundation from which to expand our markets into into the other ones in terms of how you differentiate going to market.

Speaker Change: From license satellite spectrum. Its also clear that there can be crossover benefits into into these DVD markets with that as well.

Speaker Change: One of the points that I'd make is that because of the public service obligations that we have.

Speaker Change: The public interest obligations that we have which we take seriously.

Speaker Change: Able to evolve those too.

What their future requirements as we think is important we're undertaking that I think it said.

Speaker Change: It's a good foundation from which to expand our markets into into the us.

Speaker Change: Other ones in terms of.

Speaker Change: How you differentiate going to market and one of the main points that we've made.

Mark Stankberg: One of the main points that we've made, and I mean, I'd say one of the main points that we've learned in talking to mobile network operators, automotive manufacturers, all of the big users of what's likely to be a non-terrestrial network component to 5G, they want standards-based open architecture solutions so that they don't get locked into a single. And so one of the main things that we've been doing is basically to turn this into a competitive environment that's more than who has the most money at any instant in time. What we're really trying to do is address the customer's needs or desires for those open architecture standards-based solutions.

Speaker Change: I would say one of the main points that we've learned in talking to a mobile network operators automotive manufacturers all of the big users.

Speaker Change: What's likely to be.

Speaker Change: Non terrestrial network component to five G.

Speaker Change: <unk>.

Speaker Change: They want standards based open architecture solutions, so that they don't get locked into a single choice and so one of the main things that we've been doing is.

Speaker Change: Basically turning to center.

Speaker Change: Hey.

Speaker Change: <unk> environment, that's more than who has the most money at any instant aside what we're really trying to do is address the customers needs.

Our desire so those open architecture standards based solutions and Thats one of the cause of that.

Mark Stankberg: And that is the main reason we helped form the Mobile Satellite Services Association to create the standards that not only allow a terrestrial network to operate with a particular satellite network, but to do it with all of them, right? And that they can roam among all those, maintain that. So, you know, I think that the ingredients that we're bringing and I just want to add one more component we've talked about there, which has been very important in the terrestrial environment, I think is a big equalizer when it comes to the capital environment, is that of having shared infrastructure, which you see, like, just the way the terrestrial market evolved, is that each individual carrier in a nation doesn't have to fund all of the capital, all of the capital itself, that shared capital helps reduce capital intensity, and allows us to compete.

Speaker Change: It is the main reason, we helped form the mobile satellite services Association to create standards that not only of our terrestrial network.

Speaker Change: Right with a particular satellite network.

Speaker Change: To do it with all of that.

Rome, among all those maintain that choice. So I think that I think that the ingredients that we're bringing.

Speaker Change: I would just want to add one more component and we've talked about there which has been very important in the terrestrial environment I think it's a big equalizer when it comes to the capital.

Speaker Change: Environment is that.

Speaker Change: Having.

Speaker Change: Sure the infrastructure.

Just the way the terrestrial market evolve is that each individual carrier innovation doesn't have to fund all of the capital.

Speaker Change: All of the capital.

Speaker Change: Cells that shared capital helps reduce capital intensity and allows us to compete so what I'd say is victory ingredients, we talked about it is serving our interests through these.

Mark Stankberg: So what I'd say is big three ingredients we talked about is, is serving our public interest through these aeronautical maritime and national security requirements. helping to facilitate this open architecture standards-based environment and then reducing capital intensity through shared infrastructure. I think that we're getting really good feedback that that's a good message to some of the biggest users and customers for the D2D. Thank you very much. Thanks for the question.

Speaker Change: Aeronautical maritime and National security requirements.

Speaker Change: Helping to facilitate this open architecture standards based environment, and then reducing capital intensity through shared infrastructure.

I think that.

Speaker Change: We're getting really good feedback.

Speaker Change: Good message to some of the biggest users and customers.

Speaker Change: We'll put the <unk> environment.

Speaker Change: Thank you very much.

Speaker Change: Yes, thanks for the question.

Speaker Change: Your next question comes from the line of Ryan <unk> with Needham <unk> Company. Your line is open.

Matt: Your next question comes from the line of Ryan Koontz with Needham & Company. Your line is open. Hi, this is Matt on for Ryan. Thank you for the question. Your 2026 Outlook is calling for a double digit strong growth in both the information security and cyber defense and the space emission systems businesses. Could you maybe just provide some color on what the underlying growth drivers are for those particular business segments?

Speaker Change: Hi, This is Matt on for Ryan. Thank you for the question.

Speaker Change: Your 2026 outlook is calling for double digit strong growth in both the information security and cyber defense and the space emission systems businesses could you maybe just provide some color on what the underlying growth drivers are for those particular business segments.

Garrett Chase: Sure, the, you know, in the, let's see, you mentioned three, so space and mission systems, encryption, and, I'm sorry, what was the third one? Okay, yeah, so I'll address each of them. So the encryption business, you know, one of the... One of the ways that with the problems being framed is quantum resistant encryption, right? And that's sort of that's in that's contained within the US Department of Defense Next Generation Encryption Initiative. So, again, the big issue here is carrying over a very large installed base, mission-critical equipment, and migrating that to the next generation equipment through a refresh cycle.

Speaker Change: Sure.

Speaker Change: In the let's say you mentioned three.

Especially in this space and mission systems encryption.

Speaker Change: Sorry.

Speaker Change: Or what was the third one.

Yeah, Yeah, Okay, yeah. So.

Speaker Change: Each of them.

Speaker Change: Triptan business one of the.

Speaker Change: One of the ways that puts the problems being framed as quantum resistant infection.

Speaker Change: And that's sort of that's contained within the U S Department of Defense next generation encryption.

Speaker Change: Yeah.

Speaker Change: Initiatives.

Speaker Change: Again, the big issue here is carrying over a very large installed base mission critical equipment and migrating that to the to the nexgen.

Speaker Change: Next generation equipment through a refresh cycle, but one of the things that we've talked about and we're starting to see is.

Garrett Chase: But one of the things that we've talked about and we're starting to see is there is, you know, there's a use-by date or an expiration date for the current generation of equipment. So, there is right now a big focus on refreshing that base. I would say security issues that are associated with quantum computing. So there's a lot of emphasis on that. So that is a big driver. And then the other thing that is also a good tailwind for us and one where we've been quite successful is it's become quite evident that if you look at these very large constellations, that cybersecurity is, it is a single mode of failure that affects the entire constellation.

Speaker Change: There is there is a use BIOLASE use by date exploration date for the current generation of <unk>.

Speaker Change: So there is right now.

Speaker Change: A big focus on <unk>.

Speaker Change: Refreshingly that ace as quickly as possible because they are there is exposure.

Even.

Speaker Change: Okay.

Speaker Change: As we speak.

Speaker Change: I would say security issues that are associated with quantum computing.

Speaker Change: So theres a lot of emphasis on that so that's that is a big driver and then the other thing that is.

Speaker Change: Also a good tailwind for us and one where we've been quite successful.

Speaker Change: It's become quite evident that if you look at these very very large constellations that cyber security is it is a single mode of failure.

Speaker Change: The entire installation. So there is a big focus on cyber security for space and that is an area that we have very strong position.

Garrett Chase: So there is a big focus on cybersecurity for space. And that is an area that we have a very strong.

Garrett Chase: The second one on the space and mission systems, you know, there's a number of things, and you can see some of the programs we've been successful on in this is it's not just satellite services that people are looking for in space, but there's definitely needs for technology insertions. And so we've been really quite successful in, you know, some missions include replacing some of the NASA services for space relay. That's an area that we've gotten off to a good start. There's issues, there's initiatives on standardization of optical intersatellite links. We've been very successful in a number of situations with high bandwidth radio frequency intersatellite links.

Speaker Change: The second one on the space in mission systems.

Speaker Change: There's a number of things and you can see some of the programs we've been successful on it and this is the.

Speaker Change: It's not just satellite services that people are looking for space, but there is definitely needs for technology insertion and so we've been really quite successful in.

Speaker Change: Michigan submissions to replacing some of the NASA services or space <unk>, that's an area that we've gotten off to a good start there is issue there is.

Speaker Change: Initiatives on standardization optical inter satellite links we have been very successful in a number of situations with high bandwidth radiofrequency inner satellite links there is also.

Garrett Chase: There's also some specific missions that can't be served by, I'd say, more than your commercial dual use satellites. We've been successful in those areas as well.

Speaker Change: Some specific missions that cant be served by.

Speaker Change: I'd say more.

Speaker Change: Commercial dual use satellites, we've been successful in those areas as well one of the areas. We're pretty excited about on the international front is working with the European space Agency on the lunar.

Garrett Chase: One of the areas we're pretty excited about on the international front is working with the European Space Agency on the lunar, on lunar, you know, lunar relay communications applications as the Moonlight Program. And then there are also some unique opportunities for us and for other operators that we're participating with for national security applications of some of the bands that we can use for dual use applications, including L-band. So that's kind of run down to some of the drivers for us. Great, thank you for the color. That's it for me.

Speaker Change: On the lunar.

Speaker Change: We like communications applications Moonlight program and then there are also some unique opportunities for us and for others.

Speaker Change: Operators that were participating with for national security applications of some of the bands.

Speaker Change: We.

Speaker Change: That we can use our dual use applications, including L band.

Speaker Change: That's kind of rundown of some of the drivers for us.

Great. Thank you for the color that's it for me.

Thanks, Brian.

Unknown Executive: Your next question comes from the line of calling. Calling cancelled but Cantor Fitzgerald, your line is open. Hey, thanks for the question.

Speaker Change: Your next question comes from Colin.

Speaker Change: Colin Canfield with Cantor Fitzgerald Your line is open.

Speaker Change: Hey, Thanks for the question may be focusing on introduction of new geostationary satellites could you just kind of walk us through how we should think about the kind of revenue addition for viasat, three and <unk> III in 'twenty seven.

Unknown Executive: Maybe focusing on introduction of new geostationary satellites, can you just kind of walk us through how we should think about the kind of revenue addition of ViaSat 3, F2, and F3 and 27? And maybe just walk us through kind of how you think about the moving pieces of volume versus price and growth. And then just, again, walking that all back to the multi-year EBITDA margin expansion of 200 bps of margin. So it seems like if you think about like assuming a relatively flat volume versus price outcome and a little bit of EBITDA, it feels like low single digit is the right earnings growth number for 27.

Speaker Change: Maybe just walk us through kind of how you think about the moving pieces of volume versus pricing growth.

Speaker Change: And then again walking that all back to the multi year EBIT margin expansion of 200 bps of market. So it seems like if you think about right.

Speaker Change: Assuming a relatively flat volume versus price outcome, and a little bit of EBITDA. It feels like low single digit is the right earnings growth number for 'twenty, seven, but maybe walk us through kind of how you think about that.

Unknown Executive: But maybe walk us through kind of how you think about that.

Speaker Change: Okay.

Speaker Change: I think I'm going to address the question about the 200 basis points around.

Unknown Executive: I think I'm going to address the question about the 200 basis points around, you know, how we're thinking about it, you know, across a variety of things that we've seen, you know, we've had, you know, the conviction that we've got more to go, we've got more opportunity to go through the through the integration. And, you know, when you think about the magnitude of opportunities that we've got in front of us, the importance of the year, you know, in order to maximize those opportunities, we think we really need to move towards more clarity, simplicity, being nimble.

Speaker Change: How we're thinking about it.

Speaker Change: Across a variety of things that we've seen.

Speaker Change: We've had.

Speaker Change: The conviction that we've got more to go we've got more opportunity to go through the through the integration.

Speaker Change: And when you think about the magnitude of opportunities that we've got in front of us the importance of the year in order to maximize those opportunities. We think we really need to move towards more clarity simplicity being nimble.

Unknown Executive: And we've had, you know, in a couple instances, I mean, first, you saw some of the ways in which, you know, we're looking at, you know, managing integration to reduce capital needs for the future. We've also had some scrums internally on some tough problems that we've worked through. And it's led us to believe that, you know, can operate like that much more routinely. And we've engaged some outsiders to help us think through what the magnitude of opportunity would be. And we're really comfortable that, you know, across that two or three year time horizon, you know, we'll be able to achieve numbers that would have us, you know, would have us in that range in terms of additional margin.

Speaker Change: And we've had.

Speaker Change: A couple of instances I mean first you saw some of the ways in which.

Speaker Change: We're looking at.

Managing integration to reduce capital needs for the future. We've also had some scrums internally on some tough problems that we've worked through and it's led us to believe that we can operate like that much more routinely.

Speaker Change: We've engaged some outsiders to help us think through what the magnitude of opportunity would be and we're really comfortable that.

Speaker Change: Across that two or three year time horizon.

Speaker Change: We'll be able to achieve numbers that would have us.

Speaker Change: Would have us in that range in terms of additional margin contribution.

Speaker Change: Okay got it in terms of.

Mark Stankberg: And that's in terms of it. Just in terms of the ramp, One thing just to put in perspective is each of the Flight 2 and Flight 3, each alone have more bandwidth. more capacity than all of the rest of our existing fleet put together. So those are big increases in capacity for us. And then the really big things about those two satellites. There's really nothing else like them on the market in their ability to see, kind of each of them can see a third of the world and has the ability to put bandwidth right in the places where the demand is.

Speaker Change: Just in terms of the ramp.

Speaker Change: Sure.

Speaker Change: One thing just to put in perspective.

Speaker Change: Each of the.

Speaker Change: Two and slide three each alone have more bandwidth.

Speaker Change: More capacity than all of the rest of our existing fleet put together.

Speaker Change: Those are big increases in capacity for us and then the really big things about those two satellites, there's really nothing else like them on the market and their ability to see kind of each of them can see a third of the world and has the ability to put bandwidth.

Speaker Change: In the places where they were.

Speaker Change: Are there what are the demand is so the way the way that will first of all two things right. One is how does demand growing we are winning more platforms and as you can see us as.

Mark Stankberg: So the way, you know, the way that we've grown, first of all, two things, right? I think one is, how is demand growing? We're winning more platforms. And as you can see is, as. things like aviation market goes free or in the maritime market brew use becomes the dominant use as opposed to operational use the amount of bandwidth required per platform is growing substantially and also what we are seeing is they were delivering a lot more service there's improved productivity from the customer's perspective but just like in the terrestrial world you're seeing average revenue per platform grow over that time right that's how we that's how we come out ahead but think of it as the the real competition is not so much who has the most total bandwidth, it's who has the most bandwidth in the right place at the right time.

Speaker Change: Things like aviation market goes free or in the maritime market through use becomes the dominant use as opposed to operational use.

Speaker Change: Out of bandwidth required for platform is growing substantially and.

Speaker Change: Also what we are seeing today, we're delivering service.

Speaker Change: Improved productivity from our customers' perspective.

Speaker Change: Just like in the terrestrial world Youre seeing.

Speaker Change: Average revenue per platform grow over that time right. That's how we that's how we come out ahead I think of it is.

Speaker Change: The real competition is not so much.

Speaker Change: Who has the most total bandwidth who has the most bandwidth in the right place at the right time.

Mark Stankberg: And you can see, you know what I mean? Look, everybody knows Starlink is the one that's trying to, you know, to lead these markets, but you just look at their, their own maps that they have on their website, and they'll tell you that they have bandwidth punches in a number of places. And some of those places are really important transportation hubs for maritime and for aviation. So the big thing for us is, you know, we're growing demand through more platforms, more bandwidth per platform, and then we have the flexibility to aim all that capacity right on the platforms that need it at the times that they need it.

Speaker Change: And you can see you know what I mean.

Speaker Change: Look everybody knows starlink, because when they are trying to.

Speaker Change: To lead these markets, but you just look at there.

Speaker Change: Our own maps that they have on their website and they'll tell you.

Speaker Change: They have bandwidth purchase in a number of places and some of those places are really important transportation hubs for maritime.

Speaker Change: For aviation.

Speaker Change: So the big thing for us.

Speaker Change: The growing demand through more platforms more bandwidth per platform and then we have the flexibility to aim all that capacity right on the platforms that needed at the times that they need it I think pretty simple formula.

Mark Stankberg: I think that's a pretty simple formula, but it's actually, I think it's a little differentiated in the market. Got it, got it. And let's appreciate that color.

Speaker Change: It's actually I think it's a little differentiation differentiated in the market.

Speaker Change: Got it got it I appreciate that color I just wanted to I just want to make sure we understand in terms of clarity.

Mark Stankberg: One thing I just want to make sure we understand in terms of clarity, so like in terms of contracted, so like we think of these coming online in 26, and in terms of the full kind of contracted revenue increments from F2 and F3, is there a fair way to think about the contracted additions of revenue growth versus base strain numbers? Yeah, so think of it as, well, we're not like, you know, the traditional satellite operators that usually would talk about, we're buying a new satellite, here's our backlog commitments, or the commitments we have on a transponder by transponder basis for this amount of You know, the way our business really works is what you want to look at is how many platforms we have, what the usage and revenue is per platform, and think of it as, as we bring more bandwidth to market, we're constantly growing the number of platforms, and as we go to, you know, as we get more applications per platform, those drive revenue per platform, and that's really the way in which we fill it up.

Speaker Change: In terms of contracted so like we think of these coming online in 'twenty six and in terms of the full kind of contracted revenue increments from <unk> II <unk> III is there a fair way to think about the contracted additions of revenue growth versus base case numbers.

Speaker Change: So think of it as well we're not like the traditional satellite operators that usually you would talk about it.

Speaker Change: Buying a new satellite here's our backlog commitments or the commitments, we have on a transponder by transponder basis for this amount of utilization.

Speaker Change: The way our business really works as what you want to look at is how.

Speaker Change: How many platforms, we have what the usage and revenue platform and think of it as as we bring more bandwidth to market. We're constantly growing the number of platforms and as we go to.

Speaker Change: We get more applications for platform those drive revenue per platform and that's really the way in which we fill it up. So we are think of it as what's really important is to look at those trend lines and clearly what you can see if there's one thing that should be evident.

Mark Stankberg: So we're, we are, think of it as what's really important is to look at those trend lines, and clearly what you can see, if there's one thing that should be evident, you know, from what Starlink's doing, is that when you decrease the unit cost of bandwidth, the market's grown very substantially, right? That's what that's, and that was our premise as well. So we've been a little bit handcuffed or handicapped as we're waiting for these satellites to come out, but that's really going to unlock that for us. We've been, I think we've been addressing it effectively in the meantime through adding third-party bandwidth.

Speaker Change: From what <unk> is doing is that we need to decrease the unit cost of bandwidth the market's grown very substantially right. That's what that's that was our premise as well so we've been a little bit handcuffed a.

Speaker Change: We're handicapped as we're waiting for the satellites to come out but.

Speaker Change: It's really going hard rock that for us we've been I think we've been addressing it effectively in the meantime through adding third party bandwidth.

Mark Stankberg: We're continuing to do that with both LEO and GEO bandwidth, but, you know, we've got a lot of that CapEx is behind us, right? That's what that's what the opportunity is, is that we're getting through this bolt in capex, but we're getting a lot of in And that's what's going to help drive the cash flow, the big part of what you're Gary's discussion about. That's what we're focused on. Got it, got it.

Speaker Change: To do that with both Leo and Geo bandwidth.

Speaker Change: We've got a lot of that Capex is behind us.

Speaker Change: So.

Speaker Change: That's what that's what the opportunity is is that we're getting through this both in capex, but we're getting a lot of inventory and that's what's going to help drive the cash flow. It's a big part of what you heard Gary's discussion about that's what we're focused on.

Speaker Change: Got it got it and just nobody said SaaS. The third question, maybe walk us through the free cash flow building blocks of 27. It seems like the fair way to think about just taking the numbers that you've given us if we assume like 30% of our CF growth.

Garrett Chase: And just, I never do, so that's the third question. Maybe walk us through the free cash flow building blocks for 27. It seems like the fair way to think about just taking the numbers that you've given us, if we assume like 30% of OCF growth, and the TAPx number you've given us, that gets us to maybe, you know, 100 to 200 million of burn in 26. And then with the tailwind, so the number you gave us on ViaSat 3 stepping down, so 250, and then some level of margins and working capital, maybe roughly 300 total.

Speaker Change: The Capex number you've given us I guess as to maybe $100 million to $200 million burn in 2006, and then with a tailwind. So the number you gave us on on Viasat, three stepping down to $2 50, and at some level of margins and working capital and maybe roughly 300 total so is it fair to assume that we could be looking at like a low single digit hundreds.

Garrett Chase: So is it fair to assume that we can be looking at like a low single digit, hundreds of millions of dollars opportunity for free cash flow in 27? By that math, not getting you to sign up for guidance, but just making sure our math is correct. Well, we're not necessarily going to validate your math or your guidance, but, you know, you clearly are educated on what some of the right building blocks are. You know, one of the things that we have been really focused on, and you've seen it in Mark's prepared remarks, in mine, it's about the magnitude of opportunity and the underlying meaning of what we're setting out to accomplish in fiscal 26 to position ourselves for a lot of some of those factors, you know, in terms of what they might look like on the EBITDA line.

Speaker Change: Millions of dollars opportunity for free cash flow in 2000.

Speaker Change: By that that's not going to get.

Speaker Change: Finally for guidance, but just making sure our math is correct.

Speaker Change: Well, we're not necessarily going to validate your math of awards.

Speaker Change: <unk>, but you clearly are educated on what some of the right building blocks are one of the things that we have been really focused on and you've seen it in Mark's prepared remarks in mind, it's about the magnitude of opportunity on the underlying meaning what we're setting out to accomplish in fiscal 'twenty six.

Speaker Change: To position ourselves for a lot of growth beyond that right. So I think you all know how to how to think through some of those factors.

Speaker Change: In terms of what they might look like on the EBITDA line as Mark just said, we're going to have a big lump of Capex.

Garrett Chase: As Mark just said, we're going to have a big lump of CapEx, you know, in ViaSat III behind us. And one of the things you've seen, you know, we didn't talk about it on this call, it was more of a focus last time, you know, the team here has had a tremendous amount of focus on CapEx even in the here and now, and, you know, we're all, you know, driving towards this goal of reducing the capital intensity of the business. It's resulted in almost 300 million less CapEx over the course of fiscal 25 and 26 from where we started, you know, several quarters ago.

Speaker Change: And Viasat three behind us.

Speaker Change: One of the things <unk> seen we Didnt talk about it on this call was more of a focus last time.

Speaker Change: The team here has had a tremendous amount of focus on capex, even in the here and now.

Speaker Change: And we're all.

Speaker Change: Driving towards this goal of reducing the capital intensity of the business. It's resulted in almost $300 million less capex over the course of fiscal 'twenty five and 'twenty six.

Speaker Change: From where we started several quarters ago, we're going to continue with that focus.

Garrett Chase: We're going to continue with that focus. The teams are getting trained on working capital. So, you know, the things that you're talking about are in line with the kinds of trends that we expect to see EBITDA growth, focus on things like networking capital, being really disciplined with our capital spending. Those are things that you should expect to continue to see. That's about it.

Speaker Change: Theyre getting trained on working capital so.

Speaker Change: The things that Youre talking about or are in line with the kinds of trends that we expect to see EBITDA growth focus on things like networking capital being really disciplined with our with our capital spending those are the things that you should expect to continue to see.

Speaker Change: Got it appreciate the color.

Garrett Chase: Appreciate the talk.

Louis Dipalma: Your next question comes from the line of Louis DiPalma with William Blair. Your line is open. Good afternoon.

Speaker Change: Your next question comes from the line of Louis Dipalma with William Blair. Your line is open.

Louis Dipalma: Good afternoon.

Garrett Chase: Following up on the prior question, based on What you conveyed with approximately $250 million in ViaSat-3 CapEx this year is $1 billion a good benchmark for fiscal 2027 CapEx and would that include $200 million of capitalized interest uh you know again we're not we're not going to give guidance on uh you know on on where we'll land in fiscal 27 just yet actually this year what your your numbers were you know we didn't have the 250 million of uh cap ex around the closure of the via sat 3 system that we'll have next in this current fiscal year fiscal 26 Spending was around $1 billion in total, and there was about $200 million of capitalized interest in that number.

Louis Dipalma: Following up on the prior.

Louis Dipalma: Question.

Louis Dipalma: Based on.

Louis Dipalma: What you conveyed with.

Louis Dipalma: Approximately $215 million in Viasat three Capex. This year is $1 billion a good benchmark for fiscal 2027, Capex and would that include $200 million of capitalized interest.

Louis Dipalma: Again, we're not we're not going against guidance on.

Louis Dipalma: On where we'll land in fiscal 'twenty seven just yet actually this year what your numbers were.

Louis Dipalma: Didn't have the $250 million.

Louis Dipalma: Capex around the closure of the Viasat three system that we will have next in this current fiscal year fiscal 'twenty six the spending was around $1 billion in total and there was about 200 million.

Louis Dipalma: Capitalized interest in that number.

Mark Stankberg: Bear in mind, the capitalized interest is is something that we do think will will trend down a bit, but you know, we still have satellites under construction. So that's not something that's going to disappear from the capital. Right, thanks.

Louis Dipalma: Bear in mind, the capitalized interest is something that we do think we'll trend down a bit but we still have satellites under construction. So thats not something thats kind of disappear from the capital line.

Louis Dipalma: Great. Thanks.

Mark Stankberg: And secondly, what provides confidence that maritime will inflect in late fiscal 26? Is there a continued upsell from your L band customers? And are you also taking share from like KU band maritime competitors? Okay, so the first thing was providing confidence is, we've been, you know, we went through beta trials, we've gone into production, we have a very attractive backlog, it's growing fast, even while the installation rates are growing on you know, on what we're calling Nexus Wave, which is a multi band. So right now, what we're really looking at, and it You know, we're still early days, but I'd say that the orders, the rate of which we've got orders, the size of the pipeline, the rate of installs, the existing backlog, all of those are pointing to kind of the sequence of events that we talked about last quarter, which is we should see net vessels stabilize and grow.

Louis Dipalma: And <unk>.

Speaker Change: Secondly, what provides confidence that maritime will inflect in late <unk>.

Speaker Change: Fiscal 'twenty six and their continued upsell from you R. L.

Speaker Change: L band.

Speaker Change: <unk> and are you also taking share from.

Speaker Change: <unk> band.

Speaker Change: <unk> competitors.

Speaker Change: Okay.

Speaker Change: First thing, what's providing confidence as we've been.

Speaker Change: We went through beta trials, we've gone into production, we have a very attractive backlog, it's growing fast even while the installation rates are growing.

Speaker Change: And what we're calling next wave, which is multi band one so right now.

Speaker Change: We're really looking at.

Speaker Change: We're still early days, but.

Speaker Change: I would tell you that the board.

Speaker Change: The rate of which we've got orders the size of the pipeline.

Speaker Change: The rate of installs the existing backlog all of those are pointing to kind of the sequence of events that we talked about last quarter, which is we should see that.

Speaker Change: Vessels stabilize and grow and we will see the revenue come from those vessels and we will get there.

Mark Stankberg: Then we'll see the revenue come from those vessels, and we'll get On the revenue side, one of the big things that we've talked about, I think everybody's talked about, is the increased usage on board ships going from not just operational but to crew use. So that's really driving, you know, think of it as an inflow of revenue into the maritime business, which Nexus Wave is really our first opportunity to capitalize and to provide that integrated service. So we're seeing good growth in revenue per ship given the service plan that our customers are adopting. So, I think now where that's coming from, it's pretty clear that, you know, conventional KU band isn't, doesn't have, just like in, just like in aviation, you're going to see as the demand for vessel increases, and then you look at the patterns about where those vessels aggregate, that's not, there's really not a lot of future in that we think.

Speaker Change: On the.

Speaker Change: On the revenue side, one of the big things that we've talked about.

I think everybody has talked about is the increased usage onboard ships going from not just operational but to cruise. So that's really driving.

Speaker Change: Think of it as an inflow of revenue into the maritime business, which Nexus wave is really our first opportunity to capitalize on Friday and to provide that integrated service. So we're seeing good growth in.

Speaker Change: Revenue per ship.

Speaker Change: Given the service plans that our customers are adopting.

Speaker Change: So I think where that's coming from it's pretty clear.

Speaker Change: Conventional ku band isn't doesn't.

Speaker Change: Just I can just like in aviation Youre going to see as the demand for vessel increases and then you look at the patterns about where those vessels aggregate that's not there's really not a lot of future and that we think and so we do think that that's.

Mark Stankberg: And so we do think that that, that You know, one of the ways in which we'll, we'll be able to compete really effectively. We, you know, we It's still complicated. I think the thing that that is really encouraging about what we're doing now is most of our growth is coming directly, you know, what in our direct sales to leads. And one of the good things there is it's really a way for us to be close to the customer and, you know, just understand what the pull-through is for the parts of our business that go through distribution.

Speaker Change: One of the ways in which we will be able to compete really effectively.

We.

Speaker Change: It's still complicated I think the thing that that is really encouraging about what we're doing now is most of our growth is coming directly.

Speaker Change: In our direct sales to fleets.

Speaker Change: And one of the good thing there is it really a way for us to be close to the customer and.

Speaker Change: Just understand what the pull through is for the port parts of our business that goes through distribution, but one of the things that we.

Mark Stankberg: So one of the things that we're working with is we're working with some of our indirect distributors to be able to have them understand what's going on and to be able to make win-win deals and have them come along with us. That's also on our list. That's another way I think that we're starting to see some progress and we'll see sustained. So we're talking about kind of going up sequentially in the first half, Q1, Q2, but we should get later in the year, we should start showing year-over-year revenue growth in maritime. I think that's gonna be a really good proof point for what we were talking about is how we can compete in these.

Speaker Change: Working with is we're working with some of our.

Speaker Change: Indirect distributors.

Speaker Change: To be able to have them understand what's going on and to be able to make win win deals and have them come along with US. That's also high on our list. That's another way I think that we're starting to see some progress and we will see sustained growth.

Speaker Change: So.

Speaker Change: We're talking about kind of going up sequentially in the first half.

Speaker Change: Two one Q2, but we should get later in the year, we should start showing year over year revenue growth in maritime I think that's going to be a really good proof point for what we're talking about is how we can compete.

Speaker Change: In these markets.

Mark Stankberg: Did that cover all of it, Jed? Definitely. Definitely, Mark.

Speaker Change: Does that cover.

Chad.

Mark King: Definitely definitely Mark and then one final one do you expect to play a role and in Golden Dome.

Mark Stankberg: And one final one. Do you expect to play a role in in Golden Dome? Yes. Yes, I think that, you know, I mean, the big thing there is the government is not going to outsource, they're not going to outsource everything that right there. At the end, there's going to be a very substantial pump. Transcripts provided by Transcription Outsourcing, LLC. Excellent. Thanks, everyone.

Speaker Change: Yes.

Speaker Change: Yes, I think that.

Speaker Change: The Big thing there is the government is not going to outsource they are not going to outsource everything is that right.

Speaker Change: At the end there is going to be a very substantial components across a whole range of technologies that includes cyber security sensor fusion.

Speaker Change: Cloud communications.

Speaker Change: There's going to be a lot of business across a number of disciplines of out of that going to be in technology services.

Speaker Change: Well positioned across those areas. So we're seeing opportunity there.

Speaker Change: Upfront thanks, everyone.

Speaker Change: Thanks, Greg.

Justin Lange: Our next question comes from the line of Justin Lange with Morgan Stanley, your line is. Hi, Mark and Gary. Thanks for taking the questions. I'll try to be quick here.

Speaker Change: Your next question comes from the line of Justin Langer with Morgan Stanley. Your line is open.

Justin Langer: Hi, Mark and Gary Thanks for taking my question. So I'll try to be quick here just one on government Satcom I think you mentioned good visibility from the backlog.

Garrett Chase: Just one on Government.com. I think you mentioned good visibility from the backlog. The business was a nice grower in 2025. And I guess the question is, do you see that growth sort of repeating here in 2026? Or should it taper a bit just given tougher comps? I'm just sort of curious how much of an offset Government.com is to communications services this year given some of the early aviation pressures you noted and the dynamics playing out in maritime and fixed broadband, which I think you outlined clearly. So, thanks. Yeah, we we we expect the growth to taper.

Justin Langer: This was a nice grower in 'twenty five and I guess the question is do you see that growth to repeating here in 2006 or should it taper a bit just given the tougher comp. So just sort of curious how much would offset.

Justin Langer: Our satcom is to communication services. This year given some of the early aviation pressures you noted in the dynamics playing out in maritime and fixed broadband, which I think you outlined clearly so thanks.

Justin Langer: Yes.

Justin Langer: We expect the growth to taper, but we do think it'll be up slightly so and sustain much higher levels of activity. This is.

Garrett Chase: But we do think it'll be up slightly. So and and at sustained much higher levels of activity. This is a you know, a nice margin part It'll be a big contribution. Okay, great.

Justin Langer: A nice margin part of the portfolio.

Justin Langer: It'll be a big contributor this year.

Okay, Great and then just a quick housekeeping, Gary maybe I missed it but can you mentioned leverage should pick up I think here modestly in 2016, you got flattish EBITDA and you've got the second half free cash flow question. So I guess, how should I square that with the.

Garrett Chase: And then just a quick housekeeping, Gary, maybe I missed it, but you mentioned leverage should tick up, I think, here modestly in 26, you got Flatash EBITDA, and you got the second half, free cash flow inflection. So I guess how should I square that with the sort of delevering priority you laid out? Well the de-levering is something that we've got to build. We do need to get through this year and achieve those outcomes that we described. We think once we get beyond this fiscal year and some of the impact of that ViaSat-3, CapEx, We'll be on a much different path in terms of the direction that we're heading over the course of this year We do think that amounts to a slight uptick in that, you know, EBITDA over or net debt over Great, thank you.

Justin Langer: Just sort of Delevering priority you laid out.

Justin Langer: Well the Delevering is something that we've got a bill we do need to get through this year and achieve those outcomes that we described we think once we get beyond this fiscal year and some of the impact of that.

Justin Langer: <unk> III capex.

Justin Langer: We'll be on a much different paths in terms of the direction that we're heading over the course of this year, we do think that amounts to a slight up tick in that EBITDA over net debt over EBITDA.

Justin Langer: Okay, great. Thank you.

Franz: Thank you. I'm not showing any further questions in the queue.

Justin Langer: Thank you I'm not showing any further questions in the queue.

Mark Stankberg: I would now like to turn the call over to Mark for closing remarks. Okay, thank you. So we've covered a lot of ground, got a lot of good questions.

Mark King: I would now like to turn the call over to Mark for closing remarks.

Mark King: Okay. Thank you.

Speaker Change: We've covered a lot of ground, we've got a lot of good questions.

Mark Stankberg: I think I'd just like to just kind of rattle off some of the main themes that we think are really important that we're trying to communicate this quarter. You know, one is we're making good progress. We're steady progress. We're on the Flight 2 and Flight 3 advice at 3. And we've got really good data that we think demonstrates the effectiveness of that architecture and the way that we use it on Flight 1, even though, you know, Flight 1 is certainly impaired, it demonstrates the way that we're going to use the satellites. So, you know, we're really looking at the security components and then being able to apply these principles that we described before in open architecture, standards-based, and, you know, the way that we're going to use it.

Mark King: I'd just like to.

Mark King: Rattle off some of the main themes.

Mark King: That we think are really important that we're trying to communicate this quarter one is.

Mark King: Making good progress.

Mark King: Steady progress.

Mark King: On the fight two in phase three advise at three.

Mark King: And we've got we've got really good data that we think demonstrates the effectiveness of that architecture and the way that we use it on flight one even though.

Mark King: One is certainly impaired.

Mark King: Demonstrates the way that we're going to use the satellites and I think it also helps demonstrate that not all gigabit. So they're all terabits or the same you only get points for that bandwidth that is in the place that you need it when you need it I think.

Mark King: These mobility markets is a really important thing to remember.

Mark King: We're seeing we're already seeing good results from that in aviation.

Mark King: We're having opportunities in government maritime we're off to a really good start on the multi orbit Nexus wave service L band.

Mark King: I think we're making progress starting in the DVD space, but really focused on these next generation safe.

Mark King: Safety services in aviation maritime into the National Security components, and then being able to apply these principles that we described before in open architecture standards based.

Mark Stankberg: The value of dedicated satellite spectrum, and then bringing that to market in ways that allow us to reduce capital intensity through multi-tenant shared infrastructure, same as what's happened in the terrestrials. So, that is one of the ways in which we're looking to make sure, you know, that we can continues to drive up cash flow through reduced capital intensity. We're pretty proud.

Mark King: The value of dedicated satellite spectrum.

Mark King: And then bringing that to market in.

Mark King: In ways that allow us to reduce capital intensity through multi tenant shared infrastructure same as whats happened in the in the terrestrial space.

Mark King: So that is one of the ways in which we're looking to make sure that we can continue to drive up cash flow through reduce capital intensity.

Mark King: Yes.

Mark King: We're pretty proud of those things are you know things are still in flux, but for FY 'twenty five we had record revenue record EBITDA record awards we.

Mark Stankberg: Things are still in flux, but for FY25, we had record revenue, record EBITDA, record awards. We see good opportunities for growth and operating cash flow. Gary's gone through a lot of detail on how we're going to use that to improve our capital structure. Even this year, we had two quarters of positive free cash flow. Next year, our objective is to exit the year with that sustained positive free cash flow.

Mark King: We see good opportunities for growth in operating cash flow.

Speaker Change: Yes, Gary has gone through a lot of detail on how we're going to use that to better.

Speaker Change: To improve our capital structure, even this year, we had two quarters of positive free cash flow next year. Our objective is to exit the year with just at sustained positive free cash flow.

Mark Stankberg: We've talked about a flattish FY26, it is there's some challenges in the macro environment. Mary spoke about impact of tariffs, also the issue about OEM deliveries and aviation, that's kind of a macro that we're that we're dealing with but we feel we're Well positioned for growth, we think it is becoming more clear that we can thrive and win in the market.

Speaker Change: We've talked about a flattish FY 'twenty six it is there is some challenges in the macro environment.

Spoke about impact of tariffs also the issue about OEM deliveries and aviation that's kind of a macro that we're that we're dealing with but we feel weird.

Speaker Change: Well positioned for growth, we think it is becoming more clear that we can thrive and win in the markets we're targeting.

Mark Stankberg: Last thing just want to say is, you know, there's a there's a lot of work, obviously, behind all things we're talking about. I want to thank all of our our employees and teams for the work that they're So thanks again for participating in our call. We'll speak again next.

Speaker Change: First thing to point to say is.

Speaker Change: There's a lot of work obviously behind us how things were talking about they wanted to think.

Speaker Change: All of our employees and teams for the work that they're doing.

Speaker Change: So thanks again for participating in our call and we'll speak again next quarter.

Franz: And ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Speaker Change: And ladies and gentlemen that concludes today's call. Thank you all for joining you may now disconnect.

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