The company undertakes no obligation to publicly update for looking statements to reflect subsequent events or circumstances.
Further information on these factors and other factors that could affect the lives, Financial results is included in the company's filings with the Securities and Exchange Commission.
In addition, on today's call management will refer to certain non-gaap Financial measures.
These non-gaap measures should be considered supplemental to corresponding Gap figures.
With that. I would like to turn the call over to galot CEO. Mr. ADI Sia, please go ahead. AI.
Thank you, Sanji and good day everyone. Thank you for joining us today to discuss gilad's Force quarter and full year 2025 results.
I'm pleased to report that we close both the quarter and the year with strong performance.
The fourth quarter kept a very solid 2025, reflecting consistent execution across our commercial, defense, and Peru businesses, as well as continued strategic Pro progress.
2025 was the year of significant acceleration of our revenue growth. First quarter revenue reached $137 million, up 75% year-over-year, and full-year revenue rose to $451.7 million, up 48%, with 6% year-over-year organic growth.
Adjusted EBITDA also saw significant growth in the fourth quarter, reaching $18.2 million, 50% above the same quarter last year. For the full year, adjusted EBITDA hit $53.2 million, a 26% growth year-over-year.
Over 2025 was a good and successful year for the company. Now on to the Business Review, I will start with the defense.
Military forces are increasing their dependence on resilient satellite connectivity to support Mobility, real time, intelligence and operations in contempt, contested environments.
This shift favor suppliers with proven scalable systems, strong to back records and the ability to leverage commercial technology to the defense Market. All of which are attributes of gilad Defense.
Gilad defense is gaining steady demand, from long-term, defense programs, ongoing upgrades and consistent start on spending giving the business clear visibility into future growth.
This stress and Gilat border defense, portfolio, and supports companies. Ability to capture a larger share of growing markets that values the capabilities we provide.
In 2025 our defense, business delivered, strong year-over-year, growth in New Orleans of bookings expanding customer engagement and our addressable Market.
We achieved a record year for Gilat, with defense sales driven by increased demand from U.S. and allied defense customers for our supportable, high-performance satcom solutions.
This system continued to gain traction as defense organization prioritized, flexibility rapid deployment and resilient connectivity, across diverse operational environments.
Twitter transportable ground terminal supporting new real-time intelligence and situational awareness in remote or contested environments.
Our transportable platform, provide fast, deployment resilient and reliable operation. Also in the fourth quarter, we saw continued Traction in Israel, securing significant orders across our Defence portfolio, and expanding the deployment of our Solutions in the region.
Our decision to shift more resources into Gila defense.
Expand the sales team and increase R&D investment are now clearly strengthening Gap position in the defense Market. Our defense pipeline remains strong supported by sustained Global demand for secure resilient circum solution.
Turning to our Commercial Business, demand for advanced IFC continues to accelerate, fueled by free Wi-Fi and growing passenger expectations for high-bandwidth applications.
And increasing adoption of mgso and multi orbit, architectures across the aviation ecosystem, this strength aligned directly with gilad's strength.
And long-term strategy, our Commercial Business delivered a strong fourth quarter and solid 2025, reflecting continuing, continued wins, growing customer adoptions, and consistent performance across our key programs.
It started like operator was accelerating investment in Next Generation networks. Our platform continued to be selected for the scalability, flexibility and ability to support multi orbit Mobility driven services.
Sky for Remain the central world drivers throughout the year. During the fourth quarter, we received the $42 million order from a leading global satellite operator for our multi-orbit platform, primarily supporting IFC services.
During the fourth quarter, we added 2 new skies for customers in Asia Pacific.
We continue to expand deployments with leading satellite operators, as they invest in flexible, software-defined ground networks.
These awards reinforced Sky Force's role as a core platform for large-scale, next-generation satellite networks.
We also strengthen our presence in Asia-Pacific with the Sky Edge platform order for approximately $11 million from a leading regional satellite operator to provide services over a VHDL satellite supporting multiple commercial applications.
In addition, we received more than 16 million dollar in orders for gilad's. Waste in Gateway, Solid State, power amplifiers to support Leo constellations highlighting, growing traction, for our shop Solutions as Leo. Networks, move from deployment into operational phases.
Airlines and system integrators have expanded adoption of our IFC technology for next-generation aircraft connectivity. During the fourth quarter, we received a $7 million order for Gilat's Wavestream AeroStream box. These units will be deployed as part of next-generation IFC solutions to be installed on commercial aircraft.
Stellar blue is now fully integrated into gilas operations and we are benefiting from Cross company. Synergies, gilas, blue plays a key role in our RFC leadership position with enhanced offering the drive further growth for ISSA in the IFC sector.
Production is ramping up and doing the quarter. We delivered approximately 190 Terminals and we expect increased deliveries with improved margins in the coming quarters.
As we end, we have a significant backlog that will be delivered in 2026 and beyond, based mostly on orders received during 2025 to date—more than 420. Aircraft are online with our ISATerminal and cumulatively over 1 million passengers are being served each week with our modems and ESA solutions.
Continuing this progress, we received a multi-million dollar order for our side, when the Easter terminal, for a large global avionic company. Underscoring, the advantage of our high performance, lightweight, low profile configuration that is comp compatible with both Geo and Leo satellite constellations.
Overall, our commercial pipeline remains strong as operators. Transition to multi orbit, architectures to support additional Services position as well.
For continued growth into 2026.
Moving to Peru, Gilat Peru delivered exceptional results, during the closing of more than $85 million in agreements from PAIN for the upgrade of four regional networks. These, in other words, clearly reinforced Gilat Peru's role as a key technology and solution partner for large-scale national connectivity initiatives.
Public Wi-Fi, hotspot.
And high speed connectivity to public institutions such as schools, Health Centers, and police stations.
Looking ahead, we see this progress. Continuing, we expect additional large RFPs and follow-on orders during 2026.
Positioning Peru, as an important contributor to Galax long-term growth in large National digital inclusion programs.
Our backlog is growing, with a strong, healthy, and diverse pipeline of opportunities in each of our divisions. As such, we expect another year of topline and profit growth. We expect 2026 revenues to be between $500 and $520 million.
We expected just an EV that to be between 61 and 66 million.
to summarize 2025 was a strong year for gilat marked by a good fourth quarter record performance in key, segments, meaningful customer wins and significantly, strengthened balance sheet,
We are entering 2026 with a strong momentum and cost the company in defense. We will focus on driving Revenue growth throughout Business Development, R&D investment and portfolio expansion. Further strengthening our position
We intend to pursue opportunities in government and Sovereign, Comm communication programs worldwide in commercial. We will continue to drive adoption of our IFC product portfolio, and expand our offering for Next Generation. Aircraft aircraft connectivity further. Strengthening our leadership position in IFC. We will also focus on expanding our skies for customer base.
In Peru, we plan to expand our footprint. By participating in new, digital inclusion initiatives and network expansion projects building on our proven execution and local presence.
Is accelerating its competitive advantage throughout continued. Technology leadership in multi orbit connectivity and development of advanced 5G and Tien capabilities.
measures and acquisition will be a key strategic focus with primarily emphasis on defense related capabilities, that complement our existing strengths
Gilad entered 2026, with a strong balance sheet and with additional 100 million Equity placement. In the fourth quarter, bringing total Capital rates in 2025 to 166 million,
Operator: The earnings press release was issued earlier today, and if anyone has not yet received a copy, I invite you to visit the company's website, www.gilat.com, where you'll find the release in the investor relations section. Before turning the call over to management, I would like to remind everyone that some statements made during this conference call contain forward-looking statements based on current expectations. Actual results could differ materially from those projected as a result of various risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include uncertain global economic conditions, reductions in revenues from key customers, delays or reductions in US and foreign military spending, acceptance of the company's products on a global basis, and disruptions or delays in the company's supply of raw materials and components due to business conditions, global conflicts, weather, or other factors not under its control.
Operator: The earnings press release was issued earlier today, and if anyone has not yet received a copy, I invite you to visit the company's website, www.gilat.com, where you'll find the release in the investor relations section. Before turning the call over to management, I would like to remind everyone that some statements made during this conference call contain forward-looking statements based on current expectations. Actual results could differ materially from those projected as a result of various risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include uncertain global economic conditions, reductions in revenues from key customers, delays or reductions in US and foreign military spending, acceptance of the company's products on a global basis, and disruptions or delays in the company's supply of raw materials and components due to business conditions, global conflicts, weather, or other factors not under its control.
And build on the Milestone achieved this year.
I would like to thank our employees for their commitment and performance.
And our customers and partners for their continued trust. And with that, I will hand over the call to Gil. Asia for Gil, please go ahead. Thank you. Good morning and good afternoon to everyone. Before I dive into the numbers, I would like to remind everyone that our financial results are presented both on GAAP and non-GAAP basis.
I will now walk through our financial highlights for the fourth quarter of 2025. As mentioned, we delivered a strong quarter.
And year demonstrating continued execution, across our strategic priorities and building momentum into 2026 in terms of our financial results. Revenues for the fourth quarter were were 137 million representing a 75% growth compared with 78.1 million. If you, for 2424 importantly, our organic growth quarter of a quarter was 28%,
Operator: The company cautions investors to not place undue reliance on forward-looking statements, which reflect the company's analysis only as of today's date. The company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances. Further information on these factors and other factors that could affect Gilat's financial results is included in the company's filings with the Securities and Exchange Commission. In addition, on today's call, management will refer to certain non-GAAP financial measures that management considers to be useful and differ from GAAP. These non-GAAP measures should be considered supplemental to corresponding GAAP figures. With that, I would like to turn the call over to Gilat CEO, Mr. Adi Sfadia. Please go ahead, Adi.
Operator: The company cautions investors to not place undue reliance on forward-looking statements, which reflect the company's analysis only as of today's date. The company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances. Further information on these factors and other factors that could affect Gilat's financial results is included in the company's filings with the Securities and Exchange Commission. In addition, on today's call, management will refer to certain non-GAAP financial measures that management considers to be useful and differ from GAAP. These non-GAAP measures should be considered supplemental to corresponding GAAP figures. With that, I would like to turn the call over to Gilat CEO, Mr. Adi Sfadia. Please go ahead, Adi.
So the full year revenues totaled 451.7 million reflecting 48% growth from 305.4 million in 2024. The growth for primarily driven by the in-flight connectivity vertical.
In terms of the revenue breakdown by segment.
Q4 2025 revenues for the Commercial segment were $75.1 million, compared with $37 million in the same quarter last year. The 103% growth was primarily driven by the in-flight connectivity vertical, mainly reflecting the contributions from Stella Blue.
Q4 '25 revenues for the Defense segment were $33.3 million, 14% higher than $29.4 million in the same quarter last year.
Adi Sfadia: Thank you, Sanjay, and good day, everyone. Thank you for joining us today to discuss Gilat's fourth quarter and full year 2025 results. I am pleased to report that we closed both the quarter and the year with strong performance. The fourth quarter capped a very solid 2025, reflecting consistent execution across our commercial, defense, and Peru businesses, as well as continued strategic progress. 2025 was a year of significant acceleration of our revenue growth. Fourth quarter revenue reached $137 million, up 75% year-over-year, and full year revenue rose to $451.7 million, up 48% with 6% year-over-year organic growth. Adjusted EBITDA also saw significant growth, with the fourth quarter reaching $18.2 million, 50% above the same quarter last year. The full year adjusted EBITDA hit $53.2 million, 26% growth year-over-year. Overall, 2025 was a good and successful year for the company.
Adi Sfadia: Thank you, Sanjay, and good day, everyone. Thank you for joining us today to discuss Gilat's fourth quarter and full year 2025 results. I am pleased to report that we closed both the quarter and the year with strong performance. The fourth quarter capped a very solid 2025, reflecting consistent execution across our commercial, defense, and Peru businesses, as well as continued strategic progress. 2025 was a year of significant acceleration of our revenue growth. Fourth quarter revenue reached $137 million, up 75% year-over-year, and full year revenue rose to $451.7 million, up 48% with 6% year-over-year organic growth. Adjusted EBITDA also saw significant growth, with the fourth quarter reaching $18.2 million, 50% above the same quarter last year. The full year adjusted EBITDA hit $53.2 million, 26% growth year-over-year. Overall, 2025 was a good and successful year for the company.
Q4 25 Revenue revenues for the Peru. Segment were 28.5 million compared with 1 111.8 million in Q4 2424. The increase was driven primarily by higher revenues related to new upgrade projects in 4 of the 6 regions in which we operate.
Our Gap growth margin in q425 was 28% compared with 40% in Q4 2424. The decrease is primarily at 3 at attributable to lower margins. It's still a blue as production ramps up, as well as an additional 2.9 Million. Dollars of amortization of purchased intangibles expenses related to the acquisition.
Gaap operating expenses in q425 were 25.3 million compared with 18.3 million in Q4 24. The increase was primarily driven by the consolidation of star blue expenses, amortization of acquired, intangible assets and stock-based compensation, mainly related to acquisitions
As a result Gap operating income in q425 was 13 million compared with gaap operating income of 12.8 million in Q4 24.
Adi Sfadia: Now on to the business review. I will start with the defense. Military forces are increasing their dependence on resilient satellite connectivity to support mobility, real-time intelligence, and operations in contested environments. This shift favors suppliers with proven scalable systems, strong track records, and the ability to leverage commercial technology to the defense market, all of which are attributes of Gilat Defense. Gilat Defense is gaining steady demand from long-term defense programs, ongoing upgrades, and consistent SATCOM spending, giving the business clear visibility into future growth. This strengthens Gilat's broader defense portfolio and supports companies' ability to capture a larger share of growing markets that value the capabilities we provide. In 2025, our defense business delivered strong year-over-year growth in new order bookings, expanding customer engagement, and our addressable market. We achieved the record year for Gilat Defense sales, driven by increased demand from US.
Adi Sfadia: Now on to the business review. I will start with the defense. Military forces are increasing their dependence on resilient satellite connectivity to support mobility, real-time intelligence, and operations in contested environments. This shift favors suppliers with proven scalable systems, strong track records, and the ability to leverage commercial technology to the defense market, all of which are attributes of Gilat Defense. Gilat Defense is gaining steady demand from long-term defense programs, ongoing upgrades, and consistent SATCOM spending, giving the business clear visibility into future growth. This strengthens Gilat's broader defense portfolio and supports companies' ability to capture a larger share of growing markets that value the capabilities we provide. In 2025, our defense business delivered strong year-over-year growth in new order bookings, expanding customer engagement, and our addressable market. We achieved the record year for Gilat Defense sales, driven by increased demand from US.
Gaap net income, in q425, was 8.88 million or a diluted income per share of 13 cents. Compared with gaap, net income of 11.8 million or diluted income per share of 21 cents in Q4 2424, the decrease in net income. Mainly reflects reflects higher financing costs associated with the loan taken to finance, Stella Blue acquisition together with higher tax expenses during the quarter.
Moving to non-gaap results are non-gaap growth margin in Q4 255 was 31% compared with 40% in Q4 24, non Gap. Operating expenses in q425 were 26.6 million compared with 21.9 million in Q4 2424. The increase was primarily driven by the consolidation of Stellar blue operating expenses.
Adi Sfadia: Allied defense customers for transportable, high-performance SATCOM solutions. This system continued to gain traction as defense organizations prioritized flexibility, rapid deployment, and resilient connectivity across diverse operational environments. The Q4 marked two important milestones for the business. First, we expanded into a new market segment, Earth observation, with an approximately $10 million order for a direct downlink solution. This system enabled rapid acquisition of satellite imagery and data directly from space to a transportable ground terminal, supporting near-real-time intelligence and situational awareness in remote or contested environments. Our transportable platform provides fast deployment, resilient, and reliable operations. Also, in the Q4, we saw continued traction in Israel, securing significant orders across our defense portfolio and expanding the deployment of our solutions in the region.
Adi Sfadia: Allied defense customers for transportable, high-performance SATCOM solutions. This system continued to gain traction as defense organizations prioritized flexibility, rapid deployment, and resilient connectivity across diverse operational environments. The Q4 marked two important milestones for the business. First, we expanded into a new market segment, Earth observation, with an approximately $10 million order for a direct downlink solution. This system enabled rapid acquisition of satellite imagery and data directly from space to a transportable ground terminal, supporting near-real-time intelligence and situational awareness in remote or contested environments. Our transportable platform provides fast deployment, resilient, and reliable operations. Also, in the Q4, we saw continued traction in Israel, securing significant orders across our defense portfolio and expanding the deployment of our solutions in the region.
Non Gap. Operating income in Q4. 25 was 15.2 million compared with 9.7 million in Q4 24 and non gaap. Net income in Q4, 25 was 13.4 million for a diluted income per share of 20 cents compared with a net income of 8.5 million for income per share of 15 cents in Q4 24.
The adjusted EBITDA in Q4 2025 was $18.2 million, a 50% increase compared with an adjusted EBITDA of $12.1 million in Q4 2024.
for the full year, adjusted DBA was 53.2 Million 26%, increase compared with an adjusted DBA of 42.2 million in 2024
Moving to the balance sheet and cash flow.
Adi Sfadia: Our decision to shift more resources into Gilat Defense, expand the sales team, and increase R&D investment are now clearly strengthening Gilat's position in the defense market. Our defense pipeline remains strong, supported by sustained global demand for secure, resilient SATCOM solutions. Turning to our commercial business, demand for advanced IFC continues to accelerate, fueled by free Wi-Fi, growing passenger expectations for high-bandwidth applications, and increasing adoption of NGSO and multi-orbit architectures across the aviation ecosystem. This strength aligns directly with Gilat's strength and long-term strategy. Our commercial business delivered a strong fourth quarter and solid 2025, reflecting continued wins, growing customer adoption, and consistent performance across our key programs. As satellite operators accelerate investment in next-generation networks, our platform continues to be selected for the scalability, flexibility, and ability to support multi-orbit mobility-driven services. SkyEdge IV remained a central growth driver throughout the year.
Adi Sfadia: Our decision to shift more resources into Gilat Defense, expand the sales team, and increase R&D investment are now clearly strengthening Gilat's position in the defense market. Our defense pipeline remains strong, supported by sustained global demand for secure, resilient SATCOM solutions. Turning to our commercial business, demand for advanced IFC continues to accelerate, fueled by free Wi-Fi, growing passenger expectations for high-bandwidth applications, and increasing adoption of NGSO and multi-orbit architectures across the aviation ecosystem. This strength aligns directly with Gilat's strength and long-term strategy. Our commercial business delivered a strong fourth quarter and solid 2025, reflecting continued wins, growing customer adoption, and consistent performance across our key programs. As satellite operators accelerate investment in next-generation networks, our platform continues to be selected for the scalability, flexibility, and ability to support multi-orbit mobility-driven services. SkyEdge IV remained a central growth driver throughout the year.
Liquidity position in September and December 2025. The company completed Capital raises totaling, 166 million from leading, institutional and accredited investors in Israel. In December 25. We also repay and outstanding 60 million dollars loan that has originally financed the acquisition of Stella Blue in the fourth quarter of 25. We used about 6.3 million dollars of cash on operating activities. And on the full year basis, we generated approximately 21 million dollar of operating cash flow in 2025.
As a result, as of December 31st, 2025, total cash, cash equivalents, restricted cash, and short-term deposits were $185.4 million, or approximately $183.4 million net of loans, compared with $95.6 million as of September 30th, 2025.
PSO which exclude receivables and revenue of our terrestrial Network construction projects in Peru where 88 days.
Our shareholders Equity as of December 31st, 255 totaled, 500 million, dollars, compared with 391 million dollars on September 30th, 255 results, and earnings.
Adi Sfadia: During the fourth quarter, we received a $42 million order from a leading global satellite operator for our multi-orbit platform, primarily supporting IFC services. During the fourth quarter, we added 2 new SkyEdge IV customers in Asia Pacific. We continue to expand deployments with leading satellite operators as they invest in flexible, software-defined ground networks. These awards reinforce SkyEdge IV's role as a core platform for large-scale, next-generation satellite networks. We also strengthen our presence in Asia Pacific with a SkyEdge IV platform order for approximately $11 million from a leading regional satellite operator to provide services over VHTS satellites, supporting multiple commercial applications. In addition, we received more than $16 million in orders for Gilat's Wavestream Gateway solid-state power amplifiers to support LEO constellations, highlighting growing traction for our solutions as LEO networks move from deployment into operational phases. Airlines and system integrators expanded their adoption of our IFC technology for next-generation aircraft connectivity.
Adi Sfadia: During the fourth quarter, we received a $42 million order from a leading global satellite operator for our multi-orbit platform, primarily supporting IFC services. During the fourth quarter, we added 2 new SkyEdge IV customers in Asia Pacific. We continue to expand deployments with leading satellite operators as they invest in flexible, software-defined ground networks. These awards reinforce SkyEdge IV's role as a core platform for large-scale, next-generation satellite networks. We also strengthen our presence in Asia Pacific with a SkyEdge IV platform order for approximately $11 million from a leading regional satellite operator to provide services over VHTS satellites, supporting multiple commercial applications. In addition, we received more than $16 million in orders for Gilat's Wavestream Gateway solid-state power amplifiers to support LEO constellations, highlighting growing traction for our solutions as LEO networks move from deployment into operational phases. Airlines and system integrators expanded their adoption of our IFC technology for next-generation aircraft connectivity.
we expect 2026 commercial segment, revenues of between 315 to 335 million 16% growth at the midpoint
Decent segment revenue of between 115 to 113 million, 30 million at 22% growth at the midpoint and revenue of Peru segment of between 60 to 65 million and 11%, decrease at the midpoint due to lower construction Revenue in 2026 and shift to operation. There is compared to 25.
That concludes my financial review. I would now like to open the call for questions.
Operator. Please go ahead.
Thank you, ladies and gentlemen. At this time, we will begin the question and answer section. If you dial your name, please press star 1
If you've connected via Zoom, please use the raise hand button located at the bottom of your screen.
Adi Sfadia: During the fourth quarter, we received a $7 million order for Gilat's Wavestream AeroStream BUCs. These units will be deployed as part of next-generation IFC solutions to be installed on commercial aircraft. Stellar Blu is now fully integrated into Gilat's operations, and we are benefiting from cross-company synergies. Gilat's Stellar Blu plays a key role in our IFC leadership position, with enhanced offerings that drive further growth for ESA in the IFC sector. Production is ramping up, and during the quarter, we delivered approximately 190 terminals, and we expect increased deliveries with improved margins in the coming quarters. As of year-end, we have a significant backlog that will be delivered in 2026 and beyond, based mostly on orders received during 2025. To date, more than 420 aircraft are online with our ESA terminal, and cumulatively, over 1 million passengers are being served each week with our modems and ESA solutions.
Adi Sfadia: During the fourth quarter, we received a $7 million order for Gilat's Wavestream AeroStream BUCs. These units will be deployed as part of next-generation IFC solutions to be installed on commercial aircraft. Stellar Blu is now fully integrated into Gilat's operations, and we are benefiting from cross-company synergies. Gilat's Stellar Blu plays a key role in our IFC leadership position, with enhanced offerings that drive further growth for ESA in the IFC sector. Production is ramping up, and during the quarter, we delivered approximately 190 terminals, and we expect increased deliveries with improved margins in the coming quarters. As of year-end, we have a significant backlog that will be delivered in 2026 and beyond, based mostly on orders received during 2025. To date, more than 420 aircraft are online with our ESA terminal, and cumulatively, over 1 million passengers are being served each week with our modems and ESA solutions.
Your questions will be pulled in the ordinary field.
Please stand by while we pull for your questions.
The first question is from Ryan Kuhn of medium and Company. Please go ahead.
Thanks, appreciate the question. Uh, nice, nice.
Guys. Um,
Takes been going on.
With, uh, the US budget process and how you're thinking about this year, maybe can you update us on your visibility as it relates to the defense market, both in the US and any, uh, international traction you might have? Thank you. All right, Ryan, um,
On the visibility of the defense. Uh, generally, when we are entering a year, we have, uh, uh—
between 50 to 60% um, uh,
Adi Sfadia: Continuing this progress, we received a multi-million dollar order for our Sidewinder ESA terminal from a large global avionics company, underscoring the advantage of our high-performance, lightweight, low-profile configuration that is compatible with both GEO and LEO satellite constellations. Overall, our commercial pipeline remains strong as operators transition to multi-orbit architectures to support additional services, positioning us well for continued growth into 2026. Moving to Peru, Gilat Peru delivered exceptional results during the year, closing more than $85 million in agreements from PRONATEL for the upgrade of four regional networks. These awards clearly reinforce Gilat's Peru role as a key technology and solution partner for large-scale national connectivity initiatives. These projects, which are progressing ahead of schedule, are advancing Peru's digital inclusion objectives by enabling public Wi-Fi hotspots and high-speed connectivity to public institutions such as schools, health centers, and police stations. Looking ahead, we see this progress continuing.
Adi Sfadia: Continuing this progress, we received a multi-million dollar order for our Sidewinder ESA terminal from a large global avionics company, underscoring the advantage of our high-performance, lightweight, low-profile configuration that is compatible with both GEO and LEO satellite constellations. Overall, our commercial pipeline remains strong as operators transition to multi-orbit architectures to support additional services, positioning us well for continued growth into 2026. Moving to Peru, Gilat Peru delivered exceptional results during the year, closing more than $85 million in agreements from PRONATEL for the upgrade of four regional networks. These awards clearly reinforce Gilat's Peru role as a key technology and solution partner for large-scale national connectivity initiatives. These projects, which are progressing ahead of schedule, are advancing Peru's digital inclusion objectives by enabling public Wi-Fi hotspots and high-speed connectivity to public institutions such as schools, health centers, and police stations. Looking ahead, we see this progress continuing.
Of the revenues are already in backlog uh, from the guidance. Uh, so we have a relatively good visibility. We have some large project that we are working on that uh can secure the year, uh, during the first half of the year. Um,
We don't see any effect of the recent shutdown in the US administration. We see increased budget and a lot of traction, both in the US, in Israel, and in Europe. Uh, um, when the defense organization requires satellite connectivity,
so, maybe shifting gears to to IFC a bit,
Can you update us on your, uh, your road map there, for, for line fit? I know you've been looking forward to that and maybe an update on the competitive landscape in IFC.
Sure. So um,
Adi Sfadia: We expect additional large RFPs and follow-on orders during 2026, positioning Peru as an important contributor to Gilat's long-term growth in large national digital inclusion programs. Our backlog is growing, with a strong, healthy, and diverse pipeline of opportunities in each of our divisions. As such, we expect another year of top-line and profit growth. We expect 2026 revenues to be between $500 and $520 million. We expect Adjusted EBITDA to be between $61 and $66 million. To summarize, 2025 was a strong year for Gilat, marked by a good fourth quarter, record performance in key segments, meaningful customer wins, and significantly strengthened balance sheet. We are entering 2026 with a strong momentum across the company. In defense, we will focus on driving revenue growth throughout business development, R&D investment, and portfolio expansion, further strengthening our position. We intend to pursue opportunities in government and sovereign communication programs worldwide.
Adi Sfadia: We expect additional large RFPs and follow-on orders during 2026, positioning Peru as an important contributor to Gilat's long-term growth in large national digital inclusion programs. Our backlog is growing, with a strong, healthy, and diverse pipeline of opportunities in each of our divisions. As such, we expect another year of top-line and profit growth. We expect 2026 revenues to be between $500 and $520 million. We expect Adjusted EBITDA to be between $61 and $66 million. To summarize, 2025 was a strong year for Gilat, marked by a good fourth quarter, record performance in key segments, meaningful customer wins, and significantly strengthened balance sheet. We are entering 2026 with a strong momentum across the company. In defense, we will focus on driving revenue growth throughout business development, R&D investment, and portfolio expansion, further strengthening our position. We intend to pursue opportunities in government and sovereign communication programs worldwide.
Faces. So, it it take it, it takes some time and probably will drag us to next year. Uh, but this is based on initial expectations. So, we, we didn't expect revenues from Airbus line fit in 2026, um, competitive landscape state, state, give or take the same. Um, there are a lot of traction, um, both SCS and Panasonic have a decent Awards. Not everything is published yet. So we, we do see their forecasts and we do expect some large orders, uh, coming in, in the first, uh, half of the Year. Hopefully, this quarter. Um,
as I said, in my script, most of the, uh, guidance is already covered with existing backlogs that we have that we received mostly in 2025. So, all the orders that we expect to get doing um, 26, uh, probably will be recognized in revenues in 2027.
Adi Sfadia: In commercial, we will continue to drive adoption of our IFC product portfolio and expand our offering for next-generation aircraft connectivity, further strengthening our leadership position in IFC. We will also focus on expanding our SkyEdge IV customer base. In Peru, we plan to expand our footprint by participating in new digital inclusion initiatives and network expansion projects, building on our proven execution and local presence. Gilat is accelerating its competitive advantage through continued technology leadership in multi-orbit connectivity and development of advanced 5G NTN capabilities. Mergers and acquisitions will be a key strategic focus, with primary emphasis on defense-related capabilities that complement our existing strengths. Gilat entered 2026 with a strong balance sheet and with additional $100 million equity placement in Q4, bringing total capital raised in 2025 to $166 million. This investment enhances our ability to pursue strategic opportunities and build on the milestone achieved this year.
Adi Sfadia: In commercial, we will continue to drive adoption of our IFC product portfolio and expand our offering for next-generation aircraft connectivity, further strengthening our leadership position in IFC. We will also focus on expanding our SkyEdge IV customer base. In Peru, we plan to expand our footprint by participating in new digital inclusion initiatives and network expansion projects, building on our proven execution and local presence. Gilat is accelerating its competitive advantage through continued technology leadership in multi-orbit connectivity and development of advanced 5G NTN capabilities. Mergers and acquisitions will be a key strategic focus, with primary emphasis on defense-related capabilities that complement our existing strengths. Gilat entered 2026 with a strong balance sheet and with additional $100 million equity placement in Q4, bringing total capital raised in 2025 to $166 million. This investment enhances our ability to pursue strategic opportunities and build on the milestone achieved this year.
That's terrific. Thanks maybe. Just touching on Peru. I know that business can be a bit lumpy, uh, another and take care have an election plan coming up. Can you maybe talk to the kind of uh, Cadence that you expect the Peru um, business to unfold this year? Sure. So, in Peru last, um, doing last doing 2025, we got a word of upgrading for regional.
networks that we, uh, maintain, we are in discussion with the government to, uh,
Upgrade the remaining 2.
Networks. Uh, we believe it will be able to close it before, uh, the election in the second quarter. In parallel, there are a lot of
Internal discussion in Peru of very large RFPs for internet connectivity, and both the restaurant and satellite in Peru. Um, so we expect to participate in those RFPs. A lot of traction in Peru. Uh, we don't believe that the election will cancel any of those RFPs. Uh, probably will see most of the RFPs during the, um, first quarter and during the fourth quarter of the—
You're really helpful. Thanks, all. I'll get back in the queue. Thank you, Ryan.
Adi Sfadia: I would like to thank our employees for their commitment and performance, and our customers and partners for their continued trust. With that, I will hand over the call to Gil, our CFO. Gil, please go ahead.
Adi Sfadia: I would like to thank our employees for their commitment and performance, and our customers and partners for their continued trust. With that, I will hand over the call to Gil, our CFO. Gil, please go ahead.
The next question is from Sir gauge of Freedom broker. Please go ahead.
Gil Benyamini: Thank you, Adi. Good morning and good afternoon to everyone. Before I dive into the numbers, I would like to remind everyone that our financial results are presented both on GAAP and non-GAAP basis. I will now walk through our financial highlights for the fourth quarter of 2025. As Adi mentioned, we delivered a strong quarter and year, demonstrating continued execution across our strategic priorities and building momentum into 2026. In terms of our financial results, revenues for the fourth quarter were $137 million, representing a 75% growth compared with $78.1 million in Q4, 2024. Importantly, our organic growth quarter-over-quarter was 28%. For the full year, revenues totaled $451.7 million, reflecting 48% growth from $305.4 million in 2024. The growth was primarily driven by the in-flight connectivity vertical.
Gil Benyamini: Thank you, Adi. Good morning and good afternoon to everyone. Before I dive into the numbers, I would like to remind everyone that our financial results are presented both on GAAP and non-GAAP basis. I will now walk through our financial highlights for the fourth quarter of 2025. As Adi mentioned, we delivered a strong quarter and year, demonstrating continued execution across our strategic priorities and building momentum into 2026. In terms of our financial results, revenues for the fourth quarter were $137 million, representing a 75% growth compared with $78.1 million in Q4, 2024. Importantly, our organic growth quarter-over-quarter was 28%. For the full year, revenues totaled $451.7 million, reflecting 48% growth from $305.4 million in 2024. The growth was primarily driven by the in-flight connectivity vertical.
Good morning gentlemen. So, uh, you provide pretty positive guidance for defense, and you mentioned new area, tips and operations in Earth, observation solution. Um, but could you put some colors on these contracts and its margin profile? Could it be as a significant driver for, uh, defense revenues this year?
And do you expect defense order acceleration in either Q1 compared to Q4? Thank you.
Hi. So
Gil Benyamini: In terms of the revenue breakdown by segment, Q4 2025 revenues for the commercial segment were $75.1 million compared with $37 million in the same quarter last year. The 103% growth was primarily driven by the in-flight connectivity vertical, mainly reflecting the contribution from Stellar Blu. Q4 2025 revenues for the defense segment were $33.3 million, 14% higher than $29.4 million in the same quarter last year. Q4 2025 revenues for the Peru segment were $28.5 million compared with $11.8 million in Q4 2024. The increase was driven primarily by higher revenues related to new upgrade projects in four of the six regions in which we operate. Our GAAP gross margin in Q4 2025 was 28% compared with 40% in Q4 2024.
Gil Benyamini: In terms of the revenue breakdown by segment, Q4 2025 revenues for the commercial segment were $75.1 million compared with $37 million in the same quarter last year. The 103% growth was primarily driven by the in-flight connectivity vertical, mainly reflecting the contribution from Stellar Blu. Q4 2025 revenues for the defense segment were $33.3 million, 14% higher than $29.4 million in the same quarter last year. Q4 2025 revenues for the Peru segment were $28.5 million compared with $11.8 million in Q4 2024. The increase was driven primarily by higher revenues related to new upgrade projects in four of the six regions in which we operate. Our GAAP gross margin in Q4 2025 was 28% compared with 40% in Q4 2024.
I'll start with the general comment on the defense. Uh we show in revenues relatively small growth here over here, this is mainly due to the previous shutdown of the US Administration that caused some delays in orders. We didn't lose any deal but because some of the revenues are recognized based on projects progress. And if that all the arrive late, uh, we are unable to recognize Revenue, so we'll see it in 20206. We did see very nice, uh, more than 35% year-over-year growth in orders, getting in. Um, as for the health observation, it's typically has the same margin profile that we see. On those kind of uh, of these which is um, give or take the average of uh, of gilat uh, between I would say 30 to 40%.
Great. Thank you. That's all from me.
The next question is from Louie. De Palma of William. Blair, please go ahead.
Great. Um, Adi and Gil, good afternoon.
Hi Louie. Hi Louie. How are you?
Excellent. I'm following the
private placement. What areas of m&a are you targeting?
Gil Benyamini: The decrease is primarily attributable to lower margins at Stellar Blu as production ramps up, as well as an additional $2.9 million of amortization of purchased intangible expenses related to the acquisition. GAAP operating expenses in Q4 2025 were $25.3 million compared with $18.3 million in Q4 2024. The increase was primarily driven by the consolidation of Stellar Blu expenses, amortization of acquired intangible assets, and stock-based compensation, mainly related to acquisitions. As a result, GAAP operating income in Q4 2025 was $13 million compared with GAAP operating income of $12.8 million in Q4 2024. GAAP net income in Q4 2025 was $8.8 million, or a diluted income per share of $0.13 compared with GAAP net income of $11.8 million, or diluted income per share of $0.21 in Q4 2024.
Gil Benyamini: The decrease is primarily attributable to lower margins at Stellar Blu as production ramps up, as well as an additional $2.9 million of amortization of purchased intangible expenses related to the acquisition. GAAP operating expenses in Q4 2025 were $25.3 million compared with $18.3 million in Q4 2024. The increase was primarily driven by the consolidation of Stellar Blu expenses, amortization of acquired intangible assets, and stock-based compensation, mainly related to acquisitions. As a result, GAAP operating income in Q4 2025 was $13 million compared with GAAP operating income of $12.8 million in Q4 2024. GAAP net income in Q4 2025 was $8.8 million, or a diluted income per share of $0.13 compared with GAAP net income of $11.8 million, or diluted income per share of $0.21 in Q4 2024.
Increase our Market presence.
Both in the us but we are also focusing on, on on Europe, there is a lot of business in Europe. A lot of budget specially, uh, because of the Russian Ukraine war and conflict between the Trump Administration and the European. Uh,
Countries, so they want to control their own destiny and they're increasing their investment in defense. We also see a lot of traction in secure satellite communication, so we are targeting companies over there as well. Our main focus is to bring businesses, not just to buy technology.
and, uh, we will continue to, uh,
look for, uh,
Gil Benyamini: The decrease in net income mainly reflects higher financing costs associated with a loan taken to finance Stellar Blu acquisition, together with higher tax expenses during the quarter. Moving to non-GAAP results, our non-GAAP gross margin in Q4 2025 was 31% compared with 40% in Q4 2024. Non-GAAP operating expenses in Q4 2025 were $26.6 million compared with $21.9 million in Q4 2024. The increase was primarily driven by the consolidation of Stellar Blu operating expenses. Non-GAAP operating income in Q4 2025 was $15.2 million compared with $9.7 million in Q4 2024. Non-GAAP net income in Q4 2025 was $13.4 million, or a diluted income per share of $0.20 compared with a net income of $8.5 million, or income per share of $0.15 in Q4 2024. The Adjusted EBITDA in Q4 2025 was $18.2 million, a 50% increase compared with an Adjusted EBITDA of $12.1 million in Q4 2024.
Gil Benyamini: The decrease in net income mainly reflects higher financing costs associated with a loan taken to finance Stellar Blu acquisition, together with higher tax expenses during the quarter. Moving to non-GAAP results, our non-GAAP gross margin in Q4 2025 was 31% compared with 40% in Q4 2024. Non-GAAP operating expenses in Q4 2025 were $26.6 million compared with $21.9 million in Q4 2024. The increase was primarily driven by the consolidation of Stellar Blu operating expenses. Non-GAAP operating income in Q4 2025 was $15.2 million compared with $9.7 million in Q4 2024. Non-GAAP net income in Q4 2025 was $13.4 million, or a diluted income per share of $0.20 compared with a net income of $8.5 million, or income per share of $0.15 in Q4 2024. The Adjusted EBITDA in Q4 2025 was $18.2 million, a 50% increase compared with an Adjusted EBITDA of $12.1 million in Q4 2024.
companies with great potential. Uh,
It's something that can be, um,
significant to the company's Revenue so it could be with revenues of, uh, 50 million, and above, or maybe 100 million and above
And um it should be a creative as soon as possible. It's not that we are not. We will not buy a, a company that needs the turnaround and we know how to do that. We did that in data path. We bought a company with less than 400 million in revenues and uh close to uh, break even
And now it's almost double the revenues. Uh, we also looking to expand our addressable Market in adjacent Market.
For example, um radar Solutions, electronic warfare and things like that. Um, but it will be
Uh um, something that we are considering we are doing internal work to Define exactly where we want to focus. Uh, but also we might be opportunistic here.
Gil Benyamini: For the full year, Adjusted EBITDA was $53.2 million, a 26% increase compared with an Adjusted EBITDA of $42.2 million in 2024. Moving to the balance sheet and cash flow. Over the past several quarters, we significantly strengthened our balance sheet and liquidity position. In September and December 2025, the company completed capital raises totaling $166 million from leading institutional, and accredited investors in Israel. In December 2025, we also repaid an outstanding $60 million loan that had originally financed the acquisition of Stellar Blu. In the fourth quarter of 2025, we used about $6.3 million of cash on operating activities. On the full-year basis, we generated approximately $21 million of operating cash flow in 2025.
Gil Benyamini: For the full year, Adjusted EBITDA was $53.2 million, a 26% increase compared with an Adjusted EBITDA of $42.2 million in 2024. Moving to the balance sheet and cash flow. Over the past several quarters, we significantly strengthened our balance sheet and liquidity position. In September and December 2025, the company completed capital raises totaling $166 million from leading institutional, and accredited investors in Israel. In December 2025, we also repaid an outstanding $60 million loan that had originally financed the acquisition of Stellar Blu. In the fourth quarter of 2025, we used about $6.3 million of cash on operating activities. On the full-year basis, we generated approximately $21 million of operating cash flow in 2025.
Uh, in addition, uh, we invested in the past in a startup with unique technology company called process. And we will continue to look for Unique Technologies, either? The minority investment or taking control, but it's not something that is going to, uh, change the
Overall, um, uh, financials of the company.
Great. Um, and and secondly, um
Did the Stellar blue attain the the second milestone related to the 120 million dollars in in new backlog? By the end of December?
So, no, they didn't attend the, the internet Milestone, they achieved around slightly above half of it, uh, very large order that we are expecting to get slipped into 201 26. Um,
Gil Benyamini: As a result, as of 31 December 2025, total cash, cash equivalents, restricted cash, and short-term deposits were $185.4 million, or approximately $183.4 million net of loans, compared with $95.6 million as of 30 September 2025. DSOs, which exclude receivables and revenue of our terrestrial network construction projects in Peru, were 88 days. Our shareholders' equity as of 31 December 2025 totaled $500 million compared with $391 million on 30 September 2025, resulting mainly from the capital raise and earnings. Looking ahead, reflecting our strong backlog and our visibility into 2026, we expect 2026 revenues of between $500 and $520 million, representing 13% growth year-over-year at the midpoint. We expect an Adjusted EBITDA of between $61 and $66 million, with 19% growth at the midpoint. We expect 2026 commercial segment revenues of between $315 to $335 million, with 16% growth at the midpoint.
Gil Benyamini: As a result, as of 31 December 2025, total cash, cash equivalents, restricted cash, and short-term deposits were $185.4 million, or approximately $183.4 million net of loans, compared with $95.6 million as of 30 September 2025. DSOs, which exclude receivables and revenue of our terrestrial network construction projects in Peru, were 88 days. Our shareholders' equity as of 31 December 2025 totaled $500 million compared with $391 million on 30 September 2025, resulting mainly from the capital raise and earnings. Looking ahead, reflecting our strong backlog and our visibility into 2026, we expect 2026 revenues of between $500 and $520 million, representing 13% growth year-over-year at the midpoint. We expect an Adjusted EBITDA of between $61 and $66 million, with 19% growth at the midpoint. We expect 2026 commercial segment revenues of between $315 to $335 million, with 16% growth at the midpoint.
Uh, we know that uh, it's, you know, it's it's being processed. We expect to get it if not by the end of this quarter. So early next quarter, uh, it's not affecting our revenues for 2026 because uh, revenues for 2026 are already in the backlog. There is a 9 to 12 month, lead time on the main components of the terminal. So, uh, we are pretty close for 2026. We can affect it here and there, but not the materially, um, the order that we are expecting, should be delivered, mainly in 2027. And since, uh, we need to deliver it based on customer needs, uh, if it will arrive today or with in 2 months, it's not really a, a big issue from our perspective.
I would like to emphasize it from our perspective. Uh, both the risk of delivery and the risk of new business is mitigated. We see the uh, very good acceptance of the antennas in the market. A very good quality, the
Gil Benyamini: Defense segment revenues of between $115 to $130 million, with 22% growth at the midpoint. Revenue of Peru segment of between $60 to $65 million, with an 11% decrease at the midpoint due to lower construction revenue in 2026 and shift to operation base compared to 2025. That concludes my financial review. I would now like to open the call for questions. Operator, please go ahead.
Gil Benyamini: Defense segment revenues of between $115 to $130 million, with 22% growth at the midpoint. Revenue of Peru segment of between $60 to $65 million, with an 11% decrease at the midpoint due to lower construction revenue in 2026 and shift to operation base compared to 2025. That concludes my financial review. I would now like to open the call for questions. Operator, please go ahead.
Avail availability of more than 95% more than 420. Aircraft are connected and, uh, more than 500, uh, delivered in 2025. So we we know for a fact that the, the risk that he wanted to mitigate our mitigated. And we do expect to see a future growth.
And what was Stellar Blues Revenue in 2025, and, and what is the general projection for growth in in 2026?
Operator: Thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. If dialing in, please press star one. If you've connected via Zoom, please use the raise hand button located at the bottom of your screen. Your questions will be pulled in the order they are received. Please stand by while we pull for your questions. The first question is from Ryan Koontz of Needham & Company. Please go ahead.
Operator: Thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. If dialing in, please press star one. If you've connected via Zoom, please use the raise hand button located at the bottom of your screen. Your questions will be pulled in the order they are received. Please stand by while we pull for your questions. The first question is from Ryan Koontz of Needham & Company. Please go ahead.
So when you spell 25 or about 127 million dollars, within the range that we gave between 1:20 to 1:50 million dollars? Um, today, Stella Blue is in 2026, uh, closely integrated,
With gilat with gilat business. So it's hard to uh,
To break the P&L, we do expect that, from a revenue perspective, to see double-digit growth in unit deliveries.
Ryan Koontz: Great. Thanks. Appreciate the question. Nice, nice quarter, guys. On the defense side, given kind of some of the puts and takes been going on with the US budget process and how you're thinking about this year, maybe can you update us on your visibility as it relates to the defense market, both in the US and any international traction you might have? Thank you.
Ryan Koontz: Great. Thanks. Appreciate the question. Nice, nice quarter, guys. On the defense side, given kind of some of the puts and takes been going on with the US budget process and how you're thinking about this year, maybe can you update us on your visibility as it relates to the defense market, both in the US and any international traction you might have? Thank you.
well and and 1 final 1 um did you um previously indicate that you made progress with Airbus or the inclusion of of Sidewinder into its
Online fit program.
Adi Sfadia: Hi, Ryan. On the visibility to the defense, generally, when we are entering a year, we have between 50% to 60% of the revenues are already in backlog from the guidance. So we have a relatively good visibility. We have some large projects that we are working on that can secure the year during the first half of the year. We don't see any effect of the recent shutdown in the US administration. We see increased budget and a lot of traction both in the US, in Israel, and in Europe when defense organizations require satellite connectivity.
Adi Sfadia: Hi, Ryan. On the visibility to the defense, generally, when we are entering a year, we have between 50% to 60% of the revenues are already in backlog from the guidance. So we have a relatively good visibility. We have some large projects that we are working on that can secure the year during the first half of the year. We don't see any effect of the recent shutdown in the US administration. We see increased budget and a lot of traction both in the US, in Israel, and in Europe when defense organizations require satellite connectivity.
So we do have an agreement together with the Cs to bring the side window to be line fit. And um, with Airbus SCS will be able to uh, install the
tell me now within Airbus premises, it's not yet part of the official Airbus plan of HBC Plus
Great. Now that is, um,
Still seems fairly positive. Thanks. I agree. Thank you. Lou, see you soon.
The next question is from Chris cruelty of quality space. Please go ahead.
Ryan Koontz: That's great. Thanks. Maybe shifting gears to IFC a bit. Can you update us on your roadmap there for linefit? I know you've been looking forward to that and maybe an update on the competitive landscape in IFC.
Ryan Koontz: That's great. Thanks. Maybe shifting gears to IFC a bit. Can you update us on your roadmap there for linefit? I know you've been looking forward to that and maybe an update on the competitive landscape in IFC.
Adi Sfadia: Sure. So on the linefit, as we said in the past calls, we are progressing with Boeing linefit. We expect to pass certification during the first half of the year and start delivering in Q3. So it seems promising and on track. With Airbus, we are in initial phases, so it takes some time and probably will drag us to next year. But this is based on initial expectations. So we didn't expect revenues from Airbus linefit in 2026. Competitive landscape stayed, give or take, the same. There are a lot of traction. Both SES and Panasonic have decent awards. Not everything is published yet. So we do see their forecast, and we do expect some large orders coming in in the first half of the year, hopefully this quarter.
Adi Sfadia: Sure. So on the linefit, as we said in the past calls, we are progressing with Boeing linefit. We expect to pass certification during the first half of the year and start delivering in Q3. So it seems promising and on track. With Airbus, we are in initial phases, so it takes some time and probably will drag us to next year. But this is based on initial expectations. So we didn't expect revenues from Airbus linefit in 2026. Competitive landscape stayed, give or take, the same. There are a lot of traction. Both SES and Panasonic have decent awards. Not everything is published yet. So we do see their forecast, and we do expect some large orders coming in in the first half of the year, hopefully this quarter.
I just want to follow up a little bit on Stellar pool. I think the other, uh, the next set of Milestones, they were targeting was with a large strategic contracts. I think those are separate from the large order just mentioned, which is more of a, a commercial customer. Can you give us an update on, you know, how they're progressing on some of those strategic orders? If you are a bit disconnected, can you repeat the question, please?
Uh, the question was, whether you've made any progress with Stellar blue on some of the Strategic opportunities that they're pursuing.
Um, with the one company that we cannot name yet, um, it's—
Adi Sfadia: As I said in my script, most of the guidance is already covered with existing backlogs that we have that we received mostly in 2025. So all the orders that we expect to get during 2026 probably will be recognized in revenues in 2027.
Adi Sfadia: As I said in my script, most of the guidance is already covered with existing backlogs that we have that we received mostly in 2025. So all the orders that we expect to get during 2026 probably will be recognized in revenues in 2027.
It's it's progressing. Well, I don't know if we'll be able to close everything by the end of the Milestone, which is, uh, by June. But it seems promising. Um, we are progressing. I want to remind you, that it's not just signing the agreement. It has some, uh, technical, uh, condition as well. It need to come with a minimum order of the commitment of the, at least 35 million with the gross profit which is significant. Uh almost double the gross profit that the original uh units booked had and uh come with a
relatively significant down payment.
Um, the pro the, you know, the discussion with the customer, uh, seems like, um, applying to those conditions, but it's still in early stages. Uh, so I cannot comment if it will be closed or not.
Ryan Koontz: That's terrific. Thanks. Maybe just touching on Peru, I know that business can be a bit lumpy, and I think they have an election plan coming up. Can you maybe talk to the kind of cadence that you expect the Peru business to unfold this year?
Ryan Koontz: That's terrific. Thanks. Maybe just touching on Peru, I know that business can be a bit lumpy, and I think they have an election plan coming up. Can you maybe talk to the kind of cadence that you expect the Peru business to unfold this year?
Understand, and with those products, require significant change.
It is a manufacturing order design, and where do you currently stand in the production rate?
Adi Sfadia: Sure. So in Peru, during 2025, we got the word of upgrading 4 regional networks that we maintain. We are in discussion with the government to upgrade the remaining 2 networks. We believe that we'll be able to close it before the election in Q2. In parallel, there are a lot of internal discussion in Peru of very large RFPs for internet connectivity, both terrestrial and satellite, in Peru. So we expect to participate in those RFPs. A lot of traction in Peru. We don't believe that the election will cancel any of those RFPs. Probably we'll see most of the RFPs during Q1 and during Q4 of the year.
Adi Sfadia: Sure. So in Peru, during 2025, we got the word of upgrading 4 regional networks that we maintain. We are in discussion with the government to upgrade the remaining 2 networks. We believe that we'll be able to close it before the election in Q2. In parallel, there are a lot of internal discussion in Peru of very large RFPs for internet connectivity, both terrestrial and satellite, in Peru. So we expect to participate in those RFPs. A lot of traction in Peru. We don't believe that the election will cancel any of those RFPs. Probably we'll see most of the RFPs during Q1 and during Q4 of the year.
but so those you know future products might require a significant design a lot of our products and a lot of our design changes are
Approved relatively quick, because Stella Blue expertise is with those certifications, um, and, uh, working based on qualification by similarity. Um, but in some of the cases, we are offering a different variation of the terminal. Uh,
With a cheaper design, it really depends on the customer.
in terms of production, um,
We said at the beginning of the year that we expect to reach 60 to 70 units per month. So, we reached this, um,
Uh, run rate. Uh, during the fourth quarter, we delivered 190
Ryan Koontz: Really helpful. Thanks. I'll get back in the queue.
Ryan Koontz: Really helpful. Thanks. I'll get back in the queue.
Adi Sfadia: Thank you, Ryan.
Adi Sfadia: Thank you, Ryan.
Operator: The next question is from Sergey Glinyanov of Freedom Finance Global. Please go ahead.
Operator: The next question is from Sergey Glinyanov of Freedom Finance Global. Please go ahead.
relatively small capital investment, but right now uh this production rate is give or take uh in line with customer expectations for deliveries
um,
Sergey Glinyanov: Good morning, gentlemen. So you provided pretty positive guidance for defense. And you mentioned a new area to expand operations in Earth observation solution. But could you put some colors on these contracts and its margin profile? Could it be a significant driver for defense revenue this year? And do you expect defense order acceleration in Q1 compared to Q4? Thank you.
Sergey Glinyanov: Good morning, gentlemen. So you provided pretty positive guidance for defense. And you mentioned a new area to expand operations in Earth observation solution. But could you put some colors on these contracts and its margin profile? Could it be a significant driver for defense revenue this year? And do you expect defense order acceleration in Q1 compared to Q4? Thank you.
doing the year we delivered more than 500 units.
In Q4 it was a record quarter in terms of the delivery.
Understood, and should we expect the delivery to be relatively, um, even across the year, or is there a seasonal pattern to that?
No. Um
We expected to be.
Adi Sfadia: Hi, Sergey. So I'll start with a general comment on the defense. We saw in revenues a relatively small growth year-over-year. This is mainly due to the previous shutdown of the US administration that caused some delays in orders. We didn't lose any deal, but because some of the revenues are recognized based on project progress, and if the order arrived late, we are unable to recognize revenue. So we'll see it in 2026. We did see very nice, more than 35% year-over-year growth in orders getting in. As for the Earth observation, it typically has the same margin profile that we see on those kinds of deals, which is give or take the average of Gilat between, I would say, 30% to 40%.
Adi Sfadia: Hi, Sergey. So I'll start with a general comment on the defense. We saw in revenues a relatively small growth year-over-year. This is mainly due to the previous shutdown of the US administration that caused some delays in orders. We didn't lose any deal, but because some of the revenues are recognized based on project progress, and if the order arrived late, we are unable to recognize revenue. So we'll see it in 2026. We did see very nice, more than 35% year-over-year growth in orders getting in. As for the Earth observation, it typically has the same margin profile that we see on those kinds of deals, which is give or take the average of Gilat between, I would say, 30% to 40%.
The year, of course, it can be a small changes between the quarters, but we expect a expected to be linear.
Understanding and staying on high FC. Uh do you have an update on the? Um let's say ESR 2030 terminal. Um I think that was supposed to be
Uh, targeting early this year for delivery is that still on track and maybe more broadly? What are your involving thoughts on? What is The Sweet Spot of the the flat panel antenna Market? Both in terms of, uh, your, you know, fans or from a single being doing where where you take to do product Direction. Yep.
Sergey Glinyanov: Great. Thank you. That's all from me.
Sergey Glinyanov: Great. Thank you. That's all from me.
Operator: The next question is from Louie DiPalma of William Blair. Please go ahead.
Operator: The next question is from Louie DiPalma of William Blair. Please go ahead.
So in terms of the ASR 2030, we passed qualifications and we expect to start delivering uh you know production units, probably second half of the year. It really depend when GoGo is ready to to to accept them. We know that GoGo is promoting the terminal and already have some uh, smaller work that they want to.
Louie DiPalma: Great. Adi and Gil, good afternoon.
Louie DiPalma: Great. Adi and Gil, good afternoon.
Gil Benyamini: Hi, Louis.
Gil Benyamini: Hi, Louis.
Adi Sfadia: Hi, Louie. How are you?
Adi Sfadia: Hi, Louie. How are you?
Louie DiPalma: Excellent. Following the private placement, what areas of M&A are you targeting?
Louie DiPalma: Excellent. Following the private placement, what areas of M&A are you targeting?
Adi Sfadia: That's a very good question. So first of all, we are not limiting ourselves to a specific segment, but our main focus is on the defense. On one hand, we want to increase our market presence both in the US, but we are also focusing on Europe. There is a lot of business in Europe, a lot of budgets, especially because of the Russian-Ukraine war and conflict between the Trump administration and European countries. So they want to control their own destiny, and they are increasing their investment in defense. And we see also a lot of traction in secure satellite communication. So we are targeting also companies over there. Our main focus is to bring businesses, not to buy technology. And we'll continue to look for companies with great potential. It's something that can be significant to the company's revenues.
Adi Sfadia: That's a very good question. So first of all, we are not limiting ourselves to a specific segment, but our main focus is on the defense. On one hand, we want to increase our market presence both in the US, but we are also focusing on Europe. There is a lot of business in Europe, a lot of budgets, especially because of the Russian-Ukraine war and conflict between the Trump administration and European countries. So they want to control their own destiny, and they are increasing their investment in defense. And we see also a lot of traction in secure satellite communication. So we are targeting also companies over there. Our main focus is to bring businesses, not to buy technology. And we'll continue to look for companies with great potential. It's something that can be significant to the company's revenues.
Install those, uh, antennas. So I think it's in on track for the year. Um, as, for future road map, um, the antenna currently doesn't support simultaneously. Dual beams, uh, the plans that the next generation of the product, uh, will support dual beam but uh, usually it comes with customer demand. So, uh, it's really what matter to the customer and, uh, first time to Market or he has the time for to wait for a new version of antenna with the dual beam capabilities.
Great. And uh I assume based upon the earlier um or the the delay, in the large order. Uh the backlog probably dipped below a thousand where do you expect it to finish out, say maybe by mid year and then here
Uh, it's uh, good question. You know what? We typically do not disclose the number of units that we have in backlog. Uh, I can say that the at the end we are give or take at the same level that we are at the beginning of the year, maybe slightly below. Uh, we do expect to finish the year with the
Best loss, that will cover us for at least 2,027 and Beyond.
Great. Thanks for the
Adi Sfadia: So it can be with revenues of $50 million and above or maybe $100 million and above. It should be accretive as soon as possible. It's not that we will not buy a company that needs a turnaround, and we know how to do that. We did that in Datapath. We bought a company with less than $40 million in revenues and close to break even. Now it's almost doubling their revenues. We're also looking to expand our addressable market in adjacent markets. For example, radar solutions, electronic warfare, and things like that. It will be something that we are considering. We are doing internal work to define exactly where we want to focus. We might also be opportunistic here. In addition, we invested in the past in a startup with unique technology, a company called CrossSense.
Adi Sfadia: So it can be with revenues of $50 million and above or maybe $100 million and above. It should be accretive as soon as possible. It's not that we will not buy a company that needs a turnaround, and we know how to do that. We did that in Datapath. We bought a company with less than $40 million in revenues and close to break even. Now it's almost doubling their revenues. We're also looking to expand our addressable market in adjacent markets. For example, radar solutions, electronic warfare, and things like that. It will be something that we are considering. We are doing internal work to define exactly where we want to focus. We might also be opportunistic here. In addition, we invested in the past in a startup with unique technology, a company called CrossSense.
Thank you, Chris.
The next question is, from DIA of Discovery group. Please go ahead.
Excellent year. Excellent quarter. Congratulations uh, my question is, uh, we haven't heard in a long time about high-speed ground transport, like a high-speed rail. Uh, there was a project on the way I think in China on that, uh, at any updates on on that, in that area.
um,
Indeed, I remember the project in China I think it was 10 years ago when I just arrived to to gilat. It was a promising back then uh but since then we didn't see a lot of traction. We do have here and there some terminals that we are selling for fast, trains around the world, but it's in um, limited numbers. Um and right now it's not our main focus.
Thank you.
Thank you, g.
Adi Sfadia: We'll continue to look for unique technologies, either a minority investment or taking control. But it's not something that's going to change the overall financials of the company.
Adi Sfadia: We'll continue to look for unique technologies, either a minority investment or taking control. But it's not something that's going to change the overall financials of the company.
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Louie DiPalma: Great. And secondly, did Stellar Blu attain the second milestone related to the $120 million in new backlog by the end of December?
Louie DiPalma: Great. And secondly, did Stellar Blu attain the second milestone related to the $120 million in new backlog by the end of December?
May I have further questions at this time. Mr. Bini, would you like to make a concluding statement?
Joining us.
Your time and attention. We hope to see you soon or speak with you in our next call. Thank you very much and have a great day.
Thank you, this.
Adi Sfadia: So no, they didn't attain the airnight milestone. They achieved slightly above half of it, a very large order that we are expecting to get slipped into 2026. We know that it's being processed. We expect to get it, if not by the end of this quarter, so early next quarter. It's not affecting our revenues for 2026 because revenues for 2026 are already in the backlog. There is a 9 to 12 months lead time on the main components of the terminal. So we are pretty close for 2026. We can affect it here and there, but not materially. The order that we are expecting should be delivered mainly in 2027. And since we need to deliver it based on customer needs, if it will arrive today or in two months, it's not really a big issue from our perspective.
Adi Sfadia: So no, they didn't attain the airnight milestone. They achieved slightly above half of it, a very large order that we are expecting to get slipped into 2026. We know that it's being processed. We expect to get it, if not by the end of this quarter, so early next quarter. It's not affecting our revenues for 2026 because revenues for 2026 are already in the backlog. There is a 9 to 12 months lead time on the main components of the terminal. So we are pretty close for 2026. We can affect it here and there, but not materially. The order that we are expecting should be delivered mainly in 2027. And since we need to deliver it based on customer needs, if it will arrive today or in two months, it's not really a big issue from our perspective.
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Adult conference call.
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Adi Sfadia: I would like to emphasize that from our perspective, both the risk of delivery and the risk of new business is mitigated. We see the very good acceptance of the antennas in the market, the very good quality, and the availability of more than 95%. More than 420 aircraft are connected and more than 500 delivered in 2025. So we know for a fact that the risks that we wanted to mitigate are mitigated, and we do expect to see future growth.
Adi Sfadia: I would like to emphasize that from our perspective, both the risk of delivery and the risk of new business is mitigated. We see the very good acceptance of the antennas in the market, the very good quality, and the availability of more than 95%. More than 420 aircraft are connected and more than 500 delivered in 2025. So we know for a fact that the risks that we wanted to mitigate are mitigated, and we do expect to see future growth.
Louie DiPalma: And what was Stellar Blu's revenue in 2025, and what is the general projection for growth in 2026?
Louie DiPalma: And what was Stellar Blu's revenue in 2025, and what is the general projection for growth in 2026?
Adi Sfadia: So revenues for 2025 were about $127 million within the range that we gave, between $120 to $150 million. Today, Stellar Blu is, in 2026, closely integrated with Gilat business. So it's hard to break the P&L. We do expect that from a revenue perspective, to see double-digit growth in unit deliveries.
Adi Sfadia: So revenues for 2025 were about $127 million within the range that we gave, between $120 to $150 million. Today, Stellar Blu is, in 2026, closely integrated with Gilat business. So it's hard to break the P&L. We do expect that from a revenue perspective, to see double-digit growth in unit deliveries.
Louie DiPalma: And one final one. Did you previously indicate that you made progress with Airbus for the inclusion of Sidewinder into its LineFit program?
Louie DiPalma: And one final one. Did you previously indicate that you made progress with Airbus for the inclusion of Sidewinder into its LineFit program?
Adi Sfadia: So we do have an agreement together with SES to bring the Sidewinder to be linefit. With Airbus, SES will be able to install the terminal within Airbus premises. It's not yet part of the official Airbus plan of HBC Plus.
Adi Sfadia: So we do have an agreement together with SES to bring the Sidewinder to be linefit. With Airbus, SES will be able to install the terminal within Airbus premises. It's not yet part of the official Airbus plan of HBC Plus.
Louie DiPalma: Great. Now, that still seems fairly positive. Thanks.
Louie DiPalma: Great. Now, that still seems fairly positive. Thanks.
Adi Sfadia: I agree. Thank you, Louie. See you soon.
Adi Sfadia: I agree. Thank you, Louie. See you soon.
Operator: The next question is from Chris Quilty of Quilty Space. Please go ahead.
Operator: The next question is from Chris Quilty of Quilty Space. Please go ahead.
Chris Quilty: I just want to follow up a little bit on Stellar Blu. I think the other or the next set of milestones they were targeting were some of the large strategic contracts. I think those are separate from the large order you just mentioned, which is more of a commercial customer. Can you give us an update on how they're progressing on some of those strategic orders?
Chris Quilty: I just want to follow up a little bit on Stellar Blu. I think the other or the next set of milestones they were targeting were some of the large strategic contracts. I think those are separate from the large order you just mentioned, which is more of a commercial customer. Can you give us an update on how they're progressing on some of those strategic orders?
Adi Sfadia: Chris, you are a bit disconnected. Can you repeat the question, please?
Adi Sfadia: Chris, you are a bit disconnected. Can you repeat the question, please?
Chris Quilty: The question was whether you've made any progress with Stellar Blu on some of the strategic opportunities that they're pursuing.
Chris Quilty: The question was whether you've made any progress with Stellar Blu on some of the strategic opportunities that they're pursuing.
Adi Sfadia: Okay. So you are saying to the third airline, we are making some progress with one company that we cannot name yet. It's progressing well. I don't know if we'll be able to close everything by the end of the milestone, which is by June, but it seems promising. We are progressing. I want to remind you that it's not just signing the agreement. It has some technical condition as well. It needs to come with a minimum order commitment of at least $35 million with a gross profit, which is significant, almost double the gross profit that the original units booked had, and come with a relatively significant down payment. The discussion with the customer seems like applying to those conditions, but it's still in early stages. So I cannot comment if it will be closed or not.
Adi Sfadia: Okay. So you are saying to the third airline, we are making some progress with one company that we cannot name yet. It's progressing well. I don't know if we'll be able to close everything by the end of the milestone, which is by June, but it seems promising. We are progressing. I want to remind you that it's not just signing the agreement. It has some technical condition as well. It needs to come with a minimum order commitment of at least $35 million with a gross profit, which is significant, almost double the gross profit that the original units booked had, and come with a relatively significant down payment. The discussion with the customer seems like applying to those conditions, but it's still in early stages. So I cannot comment if it will be closed or not.
Chris Quilty: Understand. And would those products require significant changes in manufacturing or design? And where do you currently stand in the production rate?
Chris Quilty: Understand. And would those products require significant changes in manufacturing or design? And where do you currently stand in the production rate?
Adi Sfadia: So those future products might require significant design. A lot of our products and a lot of our design changes are approved relatively quick because Stellar Blu expertise is with those certifications and working based on qualification by similarity. But in some of the cases, we are offering a different variation of the terminal with a cheaper design. It really depends on the customer. In terms of production, we said at the beginning of the year that we expect to reach 60 to 70 units per month. So we reached this run rate. During the Q4, we delivered 190 full terminals, including on top of it. We delivered some spare parts. We can increase this production rate with relatively small capital investment. But right now, this production rate is give or take in line with customer expectations for deliveries. During the year, we delivered more than 500 units.
Adi Sfadia: So those future products might require significant design. A lot of our products and a lot of our design changes are approved relatively quick because Stellar Blu expertise is with those certifications and working based on qualification by similarity. But in some of the cases, we are offering a different variation of the terminal with a cheaper design. It really depends on the customer. In terms of production, we said at the beginning of the year that we expect to reach 60 to 70 units per month. So we reached this run rate. During the Q4, we delivered 190 full terminals, including on top of it. We delivered some spare parts. We can increase this production rate with relatively small capital investment. But right now, this production rate is give or take in line with customer expectations for deliveries. During the year, we delivered more than 500 units.
Adi Sfadia: In Q4, it was a record quarter in terms of deliveries.
Adi Sfadia: In Q4, it was a record quarter in terms of deliveries.
Chris Quilty: Understood. Should we expect the deliveries to be relatively even across the year, or is there a seasonal pattern to that?
Chris Quilty: Understood. Should we expect the deliveries to be relatively even across the year, or is there a seasonal pattern to that?
Adi Sfadia: No. In 2026, we expect it to be linear across the year. Of course, it can be small changes between the quarters, but we expect it to be linear.
Adi Sfadia: No. In 2026, we expect it to be linear across the year. Of course, it can be small changes between the quarters, but we expect it to be linear.
Chris Quilty: Understand. And staying on IFC, do you have an update on the, let's say, ESA 2030 terminal? I think that was supposed to be targeting early this year for delivery. Is that still on track? And maybe more broadly, what are your evolving thoughts on what is the sweet spot of the flat panel antenna market, both in terms of your fans or single beam, dual beam? Where are you taking it in the new product direction?
Chris Quilty: Understand. And staying on IFC, do you have an update on the, let's say, ESA 2030 terminal? I think that was supposed to be targeting early this year for delivery. Is that still on track? And maybe more broadly, what are your evolving thoughts on what is the sweet spot of the flat panel antenna market, both in terms of your fans or single beam, dual beam? Where are you taking it in the new product direction?
Adi Sfadia: So in terms of the ESA 2030, we passed qualifications, and we expect to start delivering production units probably second half of the year. It really depends when Gogo is ready to accept them. We know that Gogo is promoting the terminal and already have some small awards that they want to install those antennas. So I think it's on track for the year. As for future roadmap, the antenna currently doesn't support simultaneously dual beams. The plans that the next generation of the product will support dual beam. But usually, it comes with customer demand. So it's really what matters to the customer, fast time to market, or he has the time to wait for a new version of antenna with dual beam capabilities.
Adi Sfadia: So in terms of the ESA 2030, we passed qualifications, and we expect to start delivering production units probably second half of the year. It really depends when Gogo is ready to accept them. We know that Gogo is promoting the terminal and already have some small awards that they want to install those antennas. So I think it's on track for the year. As for future roadmap, the antenna currently doesn't support simultaneously dual beams. The plans that the next generation of the product will support dual beam. But usually, it comes with customer demand. So it's really what matters to the customer, fast time to market, or he has the time to wait for a new version of antenna with dual beam capabilities.
Chris Quilty: Great. I assume based on the earlier or the delay in the large order, the backlog probably dipped below 1,000. Where do you expect it to finish out, say, maybe by mid-year and end of year?
Chris Quilty: Great. I assume based on the earlier or the delay in the large order, the backlog probably dipped below 1,000. Where do you expect it to finish out, say, maybe by mid-year and end of year?
Adi Sfadia: It's a good question. We typically do not disclose the number of units that we have in backlog. I can say that at year-end, we are give or take at the same level that we were at the beginning of the year, maybe slightly below. We do expect to finish the year with backlogs that will cover us for at least 2027 and beyond.
Adi Sfadia: It's a good question. We typically do not disclose the number of units that we have in backlog. I can say that at year-end, we are give or take at the same level that we were at the beginning of the year, maybe slightly below. We do expect to finish the year with backlogs that will cover us for at least 2027 and beyond.
Chris Quilty: Great. Thanks for the guidance.
Chris Quilty: Great. Thanks for the guidance.
Adi Sfadia: Thank you, Chris.
Adi Sfadia: Thank you, Chris.
Operator: The next question is from Gunther Karger of Discovery Group. Please go ahead.
Operator: The next question is from Gunther Karger of Discovery Group. Please go ahead.
Gunther Karger: Yes. Thank you. Good morning. Excellent year. Excellent quarter. Congratulations. My question is, we haven't heard in a long time about high-speed ground transport like high-speed rail. There was a project underway, I think, in China on that. Any updates on that in that area?
Gunther Karger: Yes. Thank you. Good morning. Excellent year. Excellent quarter. Congratulations. My question is, we haven't heard in a long time about high-speed ground transport like high-speed rail. There was a project underway, I think, in China on that. Any updates on that in that area?
Adi Sfadia: Indeed, I remember the project in China. I think it was 10 years ago when I just arrived to Gilat. It was promising back then. But since then, we didn't see a lot of traction. We do have here and there some terminals that we are selling for fast trains around the world, but it's in limited numbers. And right now, it's not our main focus.
Adi Sfadia: Indeed, I remember the project in China. I think it was 10 years ago when I just arrived to Gilat. It was promising back then. But since then, we didn't see a lot of traction. We do have here and there some terminals that we are selling for fast trains around the world, but it's in limited numbers. And right now, it's not our main focus.
Gunther Karger: Thank you.
Gunther Karger: Thank you.
Adi Sfadia: Thank you, Gunther Karger.
Adi Sfadia: Thank you, Gunther Karger.
Operator: If there are any additional questions, please press star 1 or use the raise hand button. Please stand by when we pull for more questions. There are no further questions at this time. Mr. Benyamini, would you like to make a concluding statement?
Operator: If there are any additional questions, please press star 1 or use the raise hand button. Please stand by when we pull for more questions. There are no further questions at this time. Mr. Benyamini, would you like to make a concluding statement?
Gil Benyamini: Thank you. I want to thank you all for joining us on this call and for your time and attention. We hope to see you soon or speak with you in our next call. Thank you very much and have a great day.
Gil Benyamini: Thank you. I want to thank you all for joining us on this call and for your time and attention. We hope to see you soon or speak with you in our next call. Thank you very much and have a great day.
Operator: Thank you. This concludes Gilat's Q4 2025 results conference call. Thank you for your participation. You may go ahead and disconnect.
Operator: Thank you. This concludes Gilat's Q4 2025 results conference call. Thank you for your participation. You may go ahead and disconnect.
