SEC Form 10-Q filed by Iridium Communications Inc

10/23/25 7:02:00 AM ET

Telecommunications Equipment

Telecommunications

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irdm-20250930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 001-33963

Iridium Communications Inc.

(Exact name of registrant as specified in its charter)


Delaware						26-1344998
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

1750 Tysons Boulevard, Suite 1400, McLean, VA 22102

(Address of principal executive offices, including zip code)

703-287-7400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, $0.001 par value

IRDM

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

Accelerated Filer

Non-Accelerated Filer

Smaller Reporting Company

Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

The number of shares of the registrant’s common stock, par value $0.001 per share, outstanding as of October 16, 2025 was 104,745,684.

IRIDIUM COMMUNICATIONS INC.

TABLE OF CONTENTS

Item No.

Page

Part I. Financial Information

ITEM 1.

Financial Statements:

Condensed Consolidated Balance Sheets

Condensed Consolidated Statements of Operations and Comprehensive Income

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Condensed Consolidated Statements of Cash Flows

Notes to Condensed Consolidated Financial Statements

ITEM 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

ITEM 3.

Quantitative and Qualitative Disclosures About Market Risk

ITEM 4.

Controls and Procedures

Part II. Other Information

ITEM 1.

Legal Proceedings

ITEM 1A.

Risk Factors

ITEM 2.

Unregistered Sales of Equity Securities and Use of Proceeds

ITEM 3.

Defaults Upon Senior Securities

ITEM 4.

Mine Safety Disclosures

ITEM 5.

Other Information

ITEM 6.

Exhibits

Signatures

PART I.

Iridium Communications Inc.

Condensed Consolidated Balance Sheets

(In thousands, except per share data)


	September 30, 2025		December 31, 2024
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	88,533	$	93,526
Accounts receivable, net	94,494		98,803
Inventory	76,187		81,283
Prepaid expenses and other current assets	16,748		19,118
Total current assets	275,962		292,730
Property and equipment, net	1,993,124		2,080,544
Equity method investments	40,351		42,516
Other assets	57,756		66,618
Intangible assets, net	87,915		90,877
Goodwill	98,942		98,186
Total assets	$	2,554,050	$	2,671,471
Liabilities and stockholders’ equity
Current liabilities:
Short-term secured debt	$	—	$	33,118
Accounts payable	13,152		19,715
Accrued expenses and other current liabilities	48,571		64,811
Deferred revenue	41,526		51,570
Total current liabilities	103,249		169,214
Long-term secured debt, net	1,809,843		1,757,767
Deferred income tax liabilities, net	125,792		114,140
Deferred revenue, net of current portion	35,425		38,259
Other long-term liabilities	29,244		15,454
Total liabilities	2,103,553		2,094,834
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.001 par value, 300,000 shares authorized, 104,736 and 110,357 shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively	105		110
Additional paid-in capital	889,398		964,348
Accumulated deficit	(443,419)		(406,092)
Accumulated other comprehensive income, net of tax	4,413		18,271
Total stockholders’ equity	450,497		576,637
Total liabilities and stockholders’ equity	$	2,554,050	$	2,671,471

See notes to unaudited condensed consolidated financial statements.

Iridium Communications Inc.

Condensed Consolidated Statements of Operations and Comprehensive Income

(In thousands, except per share amounts)

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Revenue:
Services	$	165,243	$	159,855	$	475,105	$	460,899
Subscriber equipment	21,507		22,169		64,083		69,819
Engineering and support services	40,185		30,747		119,531		86,973
Total revenue	226,935		212,771		658,719		617,691

Operating expenses:
Cost of services (exclusive of depreciation and amortization)	50,762		43,848		153,152		129,761
Cost of subscriber equipment	12,661		12,769		36,830		40,595
Research and development	4,944		6,189		14,640		19,899
Selling, general and administrative	35,508		43,953		115,887		127,487
Depreciation and amortization	52,975		51,160		157,479		151,680
Total operating expenses	156,850		157,919		477,988		469,422
Operating income	70,085		54,852		180,731		148,269
Other expense, net:
Interest expense, net	(22,593)		(24,246)		(67,169)		(68,706)

Other income (expense), net	372		312		(2,184)		(291)
Total other expense, net	(22,221)		(23,934)		(69,353)		(68,997)
Income before income taxes and gain (loss) on equity method investments	47,864		30,918		111,378		79,272
Income tax expense	(10,003)		(6,005)		(19,629)		(18,501)
Gain (loss) on equity method investments	(734)		(467)		(2,242)		15,664
Net income	$	37,127	$	24,446	$	89,507	$	76,435
Weighted average shares outstanding - basic	106,095		117,449		108,160		120,390
Weighted average shares outstanding - diluted	106,476		118,111		108,846		121,261
Net income per share - basic	$	0.35	$	0.21	$	0.83	$	0.63
Net income per share - diluted	$	0.35	$	0.21	$	0.82	$	0.63
Comprehensive income:
Net income	$	37,127	$	24,446	$	89,507	$	76,435
Foreign currency translation adjustments	(315)		(288)		2,933		(1,011)
Unrealized loss on cash flow hedges, net of tax (see Note 6)	(4,575)		(19,401)		(16,791)		(17,518)
Comprehensive income	$	32,237	$	4,757	$	75,649	$	57,906

See notes to unaudited condensed consolidated financial statements.

Iridium Communications Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

(In thousands, except per share amounts)

(Unaudited)


	Three Months Ended September 30, 2025											Three Months Ended September 30, 2024
	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Stockholders’ Equity		Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Stockholders’ Equity

	Shares	Amount										Shares	Amount
Balances at beginning of period	106,393	$	106	$	910,880	$	(446,674)	$	9,303	$	473,615	118,518	$	119	$	1,043,691	$	(292,178)	$	35,067	$	786,699
Stock-based compensation	—	—		14,652		—		—		14,652		—	—		19,035		—		—		19,035
Stock options exercised and awards vested	380	1		223		—		—		224		443	—		266		—		—		266
Stock withheld to cover employee taxes	(131)	—		(3,541)		—		—		(3,541)		(27)	—		(706)		—		—		(706)
Repurchases and retirements of common stock	(1,906)	(2)		(16,558)		(33,872)		—		(50,432)		(4,688)	(5)		(42,059)		(87,739)		—		(129,803)
Dividends	—	—		(16,258)		—		—		(16,258)		—	—		(16,491)		—		—		(16,491)
Cumulative translation adjustments	—	—		—		—		(315)		(315)		—	—		—		—		(288)		(288)
Unrealized loss on cash flow hedges, net of tax	—	—		—		—		(4,575)		(4,575)		—	—		—		—		(19,401)		(19,401)
Net income	—	—		—		37,127		—		37,127		—	—		—		24,446		—		24,446
Balances at end of period	104,736	$	105	$	889,398	$	(443,419)	$	4,413	$	450,497	114,246	$	114	$	1,003,736	$	(355,471)	$	15,378	$	663,757


	Nine Months Ended September 30, 2025											Nine Months Ended September 30, 2024
	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Stockholders’ Equity		Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Stockholders’ Equity

	Shares	Amount										Shares	Amount
Balances at beginning of period	110,357	$	110	$	964,348	$	(406,092)	$	18,271	$	576,637	122,776	$	123	$	1,089,466	$	(235,397)	$	33,907	$	888,099
Stock-based compensation	—	—		48,250		—		—		48,250		—	—		54,561		—		—		54,561
Stock options exercised and awards vested	1,800	2		1,064		—		—		1,066		1,495	1		2,871		—		—		2,872
Stock withheld to cover employee taxes	(588)	—		(17,100)		—		—		(17,100)		(175)	—		(5,130)		—		—		(5,130)
Repurchases and retirements of common stock	(6,833)	(7)		(59,664)		(126,834)		—		(186,505)		(9,850)	(10)		(88,085)		(196,509)		—		(284,604)
Dividends	—	—		(47,500)		—		—		(47,500)		—	—		(49,947)		—		—		(49,947)
Cumulative translation adjustments	—	—		—		—		2,933		2,933		—	—		—		—		(1,011)		(1,011)
Unrealized loss on cash flow hedges, net of tax	—	—		—		—		(16,791)		(16,791)		—	—		—		—		(17,518)		(17,518)
Net income	—	—		—		89,507		—		89,507		—	—		—		76,435		—		76,435
Balances at end of period	104,736	$	105	$	889,398	$	(443,419)	$	4,413	$	450,497	114,246	$	114	$	1,003,736	$	(355,471)	$	15,378	$	663,757

See notes to unaudited condensed consolidated financial statements.

Iridium Communications Inc.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)


	Nine Months Ended September 30,
	2025		2024
Cash flows from operating activities:
Net income	$	89,507	$	76,435
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes	15,782		14,676
Depreciation and amortization	157,479		151,680
Stock-based compensation (net of amounts capitalized)	43,992		51,026
Amortization of deferred financing fees	2,080		1,826
(Gain) loss on equity method investments	2,242		(15,664)
All other items, net	616		688
Changes in operating assets and liabilities:
Accounts receivable	4,813		(3,724)
Inventory	5,342		8,758
Prepaid expenses and other current assets	2,940		115
Other assets	5,172		11,036
Accounts payable	(6,038)		(26,760)
Accrued expenses and other current liabilities	(14,035)		(2,344)

Deferred revenue	(14,345)		3,697
Other long-term liabilities	(4,069)		(279)
Net cash provided by operating activities	291,478		271,166

Cash flows from investing activities:
Capital expenditures	(66,791)		(45,622)
Acquisition of Satelles, Inc., net of cash acquired	—		(110,713)


Net cash used in investing activities	(66,791)		(156,335)

Cash flows from financing activities:

Borrowings under the Term Loan	—		419,783
Payments on the Term Loan	(33,024)		(109,629)
Borrowings under the Revolving Credit Facility	50,000		50,000
Payments on the Revolving Credit Facility	—		(50,000)
Repurchases of common stock	(186,505)		(284,603)
Payment of deferred financing fees	—		(345)
Proceeds from exercise of stock options	1,066		2,872
Tax payment upon settlement of stock awards	(17,100)		(5,130)
Payment of common stock dividends	(46,865)		(49,103)
Net cash used in financing activities	(232,428)		(26,155)

Effect of exchange rate changes on cash and cash equivalents, and restricted cash	2,748		(958)
Net increase (decrease) in cash and cash equivalents, and restricted cash	(4,993)		87,718
Cash, cash equivalents, and restricted cash, beginning of period	93,526		71,870
Cash, cash equivalents, and restricted cash, end of period	$	88,533	$	159,588

Supplemental cash flow information:
Interest paid, net of amounts capitalized	$	68,199	$	73,354
Income taxes paid, net	$	5,479	$	3,566

Supplemental disclosure of non-cash investing and financing activities:
Property and equipment received but not paid	$	9,118	$	7,919
Dividends accrued on common stock	$	3,170	$	2,175
Capitalized stock-based compensation	$	4,258	$	3,536

See notes to unaudited condensed consolidated financial statements.

Iridium Communications Inc.

Notes to Condensed Consolidated Financial Statements

1. Basis of Presentation and Principles of Consolidation

Iridium Communications Inc. (the “Company”) prepared its condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The Company’s operations are primarily conducted through, and its operating assets are owned by, its principal operating subsidiary, Iridium Satellite LLC, Iridium Satellite LLC’s immediate parent, Iridium Holdings LLC, and their respective subsidiaries. The accompanying condensed consolidated financial statements include the accounts of (i) the Company, (ii) its wholly owned subsidiaries, and (iii) all less than wholly owned subsidiaries that the Company controls. All material intercompany transactions and balances have been eliminated.

In the opinion of management, the condensed consolidated financial statements reflect all normal recurring adjustments that the Company considers necessary for the fair presentation of its results of operations and cash flows for the interim periods covered, and of the financial position of the Company at the date of the interim condensed consolidated balance sheet. The operating results for interim periods are not necessarily indicative of the operating results for the entire year. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to instructions, rules and regulations prescribed by the U.S. Securities and Exchange Commission (“SEC”). These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2024, as filed with the SEC on February 13, 2025.

2. Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates and assumptions, including those related to revenue recognition, the useful lives and recoverability of long-lived and intangible assets, goodwill, income taxes, stock-based compensation, the incremental borrowing rate for its leases, and contingencies, among others. The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that it believes are reasonable, including assumptions as to future events. These estimates form the basis for making judgments about the carrying values of assets and liabilities and recorded revenues and expenses. Actual results could differ materially from those estimates.

Fair Value Measurements

The Company evaluates assets and liabilities subject to fair value measurements on a recurring and non-recurring basis to determine the appropriate level to classify them for each reporting period. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

The fair value hierarchy consists of the following tiers:

•Level 1, defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

•Level 2, defined as observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

•Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The fair value estimates are based upon certain market assumptions and information available to the Company. The carrying values of the following financial instruments approximated their fair values as of September 30, 2025 and December 31, 2024: (1) cash and cash equivalents, (2) prepaid expenses and other current assets, (3) accounts receivable, (4) accounts payable, and (5) accrued expenses and other current liabilities. Fair values approximate their carrying values because of their short-term nature. The Level 2 cash equivalents include money market funds, commercial paper and short-term U.S. agency securities. The Company also classifies its derivative financial instruments as Level 2. In determining fair value of Level 2 assets, the Company uses a market approach utilizing valuation models that incorporate observable inputs such as interest rates, bond yields and quoted prices for similar assets. The Company did not hold any Level 3 assets as of September 30, 2025 or December 31, 2024.

Leases

For new leases, the Company will determine if an arrangement is or contains a lease at inception. Leases are included as (1) right-of-use (“ROU”) assets within other assets and (2) ROU liabilities within accrued expenses and other liabilities and are included within other long-term liabilities on the Company’s condensed consolidated balance sheets.

ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Certain leases contain variable contractual obligations as a result of future base rate escalations which are estimated based on observed trends and included within the measurement of present value. The Company’s leases do not provide an implicit rate. The Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The ROU asset also includes any lease payments made and excludes lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For certain leases, such as teleport network facilities, the Company elects the practical expedient to combine lease and non-lease components as a single lease component. Taxes assessed on leases in which the Company is either a lessor or lessee are excluded from contract consideration and variable payments when measuring new lease contracts or remeasuring existing lease contracts.

Inventory

Inventory consists primarily of finished goods and raw materials from third-party manufacturers. The Company outsources manufacturing of subscriber equipment to a third-party manufacturer and purchases accessories from third-party suppliers. The Company’s cost of inventory includes an allocation of overhead, including payroll and payroll-related costs of employees directly involved in bringing inventory to its existing condition, and freight. Inventories are valued using the average cost method and are carried at the lower of cost or net realizable value.

The Company has a manufacturing agreement with Benchmark Electronics Inc. (“Benchmark”) to manufacture most of its subscriber equipment. Pursuant to the agreement, the Company may be required to purchase excess materials at cost plus a contractual markup if the materials are not used in production within the periods specified in the agreement. Benchmark will then repurchase such materials from the Company at the same price paid by the Company, as required for the production of the subscriber equipment.

The following table summarizes the Company’s inventory balances:


	September 30, 2025		December 31, 2024
	(In thousands)
Finished goods	$	53,354	$	52,496
Raw materials	23,701		29,605
Inventory valuation reserve	(868)		(818)
Total	$	76,187	$	81,283

Derivative Financial Instruments

The Company uses derivatives to manage its exposure to fluctuating interest rate risk on variable rate debt. Its derivatives are measured at fair value and are recorded on the condensed consolidated balance sheets within other assets and other current liabilities. When the Company’s derivatives are designated as cash flow hedges, the effective portion of the changes in fair value of the derivatives are recorded in accumulated other comprehensive income within the Company’s condensed consolidated balance sheets and subsequently recognized in earnings when the hedged items impact earnings. Any ineffective portion of a derivative’s change in fair value will be recognized in earnings in the same period in which the hedged interest payments affect earnings. Within the condensed consolidated statements of operations and comprehensive income, the gains and losses related to cash flow hedges are recognized within interest income (expense), net, as this is the same financial statement line item used for any gains or losses associated with the hedged items. Cash flows from hedging activities are included in operating activities within the Company’s condensed consolidated statements of cash flows, which is the same category as the item being hedged. See Note 6 for further information.

Business Combinations and Goodwill

The purchase price for business combinations is allocated to the assets acquired, including tangible and intangible assets, and assumed liabilities, where applicable, based on their respective fair values at the acquisition date. Acquisition-related costs are expensed as incurred. Goodwill is recorded when the cost of an acquired entity exceeds the amounts assigned to the assets acquired and liabilities assumed. The net assets and results of operations of an acquired entity are included in the Company’s consolidated financial statements from the acquisition date. Goodwill is not amortized but is tested for impairment annually or upon the occurrence of certain events.

Other Intangible Assets

The Company’s other intangible assets that have finite lives (customer relationships, patents and other intellectual property) are amortized over their useful lives and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If any such indicators are present, the Company tests for recoverability by comparing the carrying amount of the asset to the net undiscounted cash flows expected to be generated from the asset.

A portion of the Company’s other intangible assets are spectrum, regulatory authorizations, and trade names, which are indefinite-lived. The Company reevaluates the useful life determination for these assets each reporting period to determine whether events and circumstances continue to support an indefinite useful life. Indefinite-lived intangible assets are not amortized and are instead tested for impairment annually, or upon the occurrence of certain events.

3. Cash and Cash Equivalents

The following table presents the Company’s cash and cash equivalents:


	September 30, 2025		December 31, 2024		Recurring Fair Value Measurement
	(In thousands)
Cash and cash equivalents:
Cash	$	28,132	$	16,913
Money market funds	60,401		76,613		Level 2

Total cash and cash equivalents	$	88,533	$	93,526

4. Intangible Assets and Goodwill

Intangible Assets

The following tables present identifiable intangible assets:


	September 30, 2025
	Useful Life	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
	(In thousands)
Indefinite life intangible assets:
Trade names	Indefinite	$	21,195	$	—	$	21,195
Spectrum and licenses	Indefinite	14,030		—		14,030
Total		35,225		—		35,225
Definite life intangible assets:
Intellectual property	20 years	16,439		(11,745)		4,694
Patents	14 - 20 years	587		(239)		348
Customer relationships	12 years	57,000		(9,352)		47,648
Total		74,026		(21,336)		52,690
Total intangible assets		$	109,251	$	(21,336)	$	87,915


	December 31, 2024
	Useful Life	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
	(In thousands)
Indefinite life intangible assets:
Trade names	Indefinite	$	21,195	$	—	$	21,195
Spectrum and licenses	Indefinite	14,030		—		14,030
Total		35,225		—		35,225
Definite life intangible assets:
Intellectual property	20 years	16,439		(11,420)		5,019
Patents	14 - 20 years	587		(209)		378
Customer relationships	12 years	57,000		(6,745)		50,255
Total		74,026		(18,374)		55,652
Total intangible assets		$	109,251	$	(18,374)	$	90,877

Amortization expense was $1.0 million and $2.4 million for the three months ended September 30, 2025 and September 30, 2024, respectively, and $3.0 million and $4.9 million for the nine months ended September 30, 2025 and September 30, 2024, respectively.

Goodwill

As of September 30, 2025 and December 31, 2024, the Company’s goodwill balance was $98.9 million and $98.2 million, respectively. The goodwill balance was a result of the acquisition of Satelles, Inc.

5. Debt

Term Loan and Revolving Facility

Pursuant to a credit agreement (as amended to date, the “Credit Agreement”), the Company previously entered into a term loan totaling $1,500.0 million (as so amended and restated, the “Term Loan”), issued at a price equal to 99.75% of its face value, and an accompanying $100.0 million revolving loan (the “Revolving Facility”). The maturity dates of the Term Loan and Revolving Facility are in September 2030 and September 2028, respectively. During the year ended December 31, 2024, the Company borrowed an additional $325.0 million under its Term Loan, comprised of $125.0 million on March 25, 2024, issued at a price equal to 99.875% of its face value, and $200.0 million on July 30, 2024, issued at 99.0% of its face value. The additional amounts borrowed are fungible with the original $1,500.0 million and have the same maturity date, interest rate and other terms.

The proceeds from the March 2024 Term Loan were used for the acquisition of Satelles, Inc. on April 1, 2024. In April 2024, the Company drew down $50.0 million on its Revolving Facility for general corporate purposes, including the funding of repurchases of its common stock. This amount was repaid with the expansion of the Term Loan in July 2024, and there were no amounts outstanding under the Revolving Facility as of December 31, 2024. The remaining proceeds from the July 2024 Term Loan were used for general corporate purposes, including repurchases of common stock. In March and April 2025, the Company drew down $20.0 million and $30.0 million on its Revolving Facility, respectively, for general corporate purposes, all of which remained outstanding as of September 30, 2025.

The Term Loan has been repriced on multiple occasions, most recently in June 2024, and currently bears interest at an annual rate equal to the Secured Overnight Financing Rate (“SOFR”) plus 2.25%, with a 0.75% SOFR floor. The Company typically selects a one-month interest period, with the result that interest is calculated using one-month SOFR. Interest is paid monthly on the last business day of the month. Principal payments, payable quarterly, are equal to approximately $18.3 million per annum (one percent of the full principal amount of the Term Loan following the additional Term Loan amounts borrowed in 2024), with the remaining principal due upon maturity. As noted below, no quarterly principal payment was made for the quarter ended September 30, 2025 as a result of the excess cash flow payment made in May 2025.

The Revolving Facility matures in September 2028 and bears interest at an annual rate of SOFR plus 2.5% (but without a SOFR floor) if and as drawn, with no original issue discount, and a commitment fee of 0.5% per year on the undrawn amount, which is reduced to 0.375% if the Company has a consolidated first lien net leverage ratio (as defined in the Credit Agreement) of less than 3.5 to 1.

As of September 30, 2025 and December 31, 2024, the Company reported an aggregate of $1,774.7 million and $1,807.7 million in borrowings under the Term Loan, respectively. These amounts do not include $14.9 million and $16.9 million of net unamortized deferred financing costs as of September 30, 2025 and December 31, 2024, respectively. The

net principal balance in borrowings in the accompanying consolidated balance sheets as of September 30, 2025 and December 31, 2024 amounted to $1,759.8 million and $1,790.9 million, respectively. As of September 30, 2025 and December 31, 2024, based upon recent trading prices (Level 2 - market approach), the fair value of the Company’s borrowings under the Term Loan was $1,683.8 million and $1,802.1 million, respectively.

The Credit Agreement restricts the Company’s ability to incur liens, engage in mergers or asset sales, pay dividends, repay subordinated indebtedness, incur indebtedness, make investments and loans, and engage in other transactions as specified in the Credit Agreement. The Credit Agreement provides for specified exceptions, including baskets measured as a percentage of trailing twelve months of earnings before interest, taxes, depreciation and amortization (“EBITDA”), and unlimited exceptions in the case of incurring indebtedness and liens and making investments, dividend payments, and payments of subordinated indebtedness, based on achievement and maintenance of specified leverage ratios. The Credit Agreement also contains an annual mandatory prepayment sweep mechanism with respect to a portion of the Company’s excess cash flow (as defined in the Credit Agreement) in the event the Company’s net leverage ratio rises above 3.5 to 1. The Company’s mandatory excess cash flow prepayment, as specified in the Credit Agreement, was $28.5 million as of December 31, 2024. This amount was paid in May 2025. As a result, no quarterly principal payment was required for the quarter ended September 30, 2025, and no quarterly principal payment will be required for the remainder of 2025 or the first three quarters of 2026. The Credit Agreement permits repayment, prepayment and repricing transactions.

The Credit Agreement contains no financial maintenance covenants with respect to the Term Loan. With respect to the Revolving Facility, the Credit Agreement requires the Company to maintain a consolidated first lien net leverage ratio (as defined in the Credit Agreement) of no greater than 6.25 to 1 if more than 35% of the Revolving Facility has been drawn, or subject to letter of credit exposure. As of September 30, 2025, the aggregate exposure under the Revolving Facility was above 35% and the Company was in compliance with all covenants. The Credit Agreement contains other customary representations and warranties, affirmative and negative covenants, and events of default.

Interest on Debt

Total interest incurred includes amortization of deferred financing fees and capitalized interest. The Company incurred third-party financing costs of $2.2 million in connection with the expansion of the Term Loan in July 2024, $1.9 million related to the repricing of the Term Loan in June 2024 and $1.6 million in connection with the expansion of the Term Loan in March 2024, materially all of which was expensed at that time. The amounts expensed are included within interest expense on the condensed consolidated statements of operations and comprehensive income. There were no such expenses in 2025. The following table presents the interest and amortization of deferred financing fees related to the Term Loan:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
	(In thousands)				(In thousands)
Total interest incurred	$	24,955	$	27,797	$	73,954	$	77,101
Amortization of deferred financing fees	$	739	$	657	$	2,175	$	1,918
Capitalized interest	$	1,108	$	1,272	$	3,174	$	3,460

At each of September 30, 2025 and December 31, 2024, accrued interest on the Term Loan was $0.3 million.

6. Derivative Financial Instruments

The Company is exposed to interest rate fluctuations related to the Term Loan. The Company has reduced its exposure to fluctuations in the cash flows associated with changes in the variable interest rate by entering into offsetting positions through the use of interest rate hedges. This will reduce the negative impact of increases in the variable rate over the term of the derivative contracts. These contracts are not used for trading or other speculative purposes. Historically, the Company has not incurred, and does not expect to incur in the future, any losses as a result of counterparty default.

Interest Rate Cap

In July 2021, the Company entered into an interest rate cap contract (the “Cap”), which had an effective date of December 2021. The Cap manages the Company’s exposure to interest rate movements on a portion of the Term Loan through November 2026. The Cap, as modified to date, currently provides the Company with the right to receive payment from the counterparty if one-month SOFR exceeds 1.436%. The Company pays a fixed monthly premium based on an annual rate of 0.31% for the Cap. The Cap carried a notional amount of $1.0 billion as of September 30, 2025 and December 31, 2024.

The Cap, which was not affected by the expansion of the Term Loan in July 2024 and March 2024 or the repricing of the Term Loan in June 2024, is designed to mirror the terms of the Term Loan and to offset the cash flows being hedged. The Company designated the Cap as a cash flow hedge of the variability of the SOFR-based interest payments on the Term Loan. The effective portion of the Cap’s change in fair value is recorded in accumulated other comprehensive income. Any ineffective portion of the Cap’s change in fair value will be recorded in current earnings as interest expense.

Fair Value of Derivative Instruments

As of September 30, 2025 and December 31, 2024, the Company had an asset balance of $23.1 million and $47.3 million, respectively, for the fair value of the Cap and a liability balance of $3.4 million and $5.6 million, respectively, for the fair value of the Cap premium. Both the Cap and the Cap premium are recorded net within other assets on the condensed consolidated balance sheet.

During each of the three months ended September 30, 2025 and 2024, the Company incurred $0.8 million in interest expense for the Cap premium, and during each of the nine months ended September 30, 2025 and 2024, the Company incurred $2.5 million in interest expense for the Cap premium. Interest expense was reduced by $7.4 million and $9.8 million for the three months ended September 30, 2025 and 2024, respectively, and $21.9 million and $29.5 million for the nine months ended September 30, 2025 and 2024, respectively, for payments received related to the Cap.

Gains and losses resulting from fair value adjustments to the Cap are recorded within accumulated other comprehensive income within the Company’s condensed consolidated balance sheets and reclassified to interest expense on the dates that interest payments become due. Cash flows related to the derivative contracts are included in cash flows from operating activities on the condensed consolidated statements of cash flows. Over the next 12 months, the Company expects any gains or losses for cash flow hedges amortized from accumulated other comprehensive income into earnings to have an immaterial impact on the Company’s consolidated financial statements.

The following table presents the amount of unrealized gain or loss and related tax impact associated with the derivative instruments that the Company recorded in its condensed consolidated statements of operations and comprehensive income:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
	(In thousands)				(In thousands)
Unrealized loss, net of tax	$	(4,575)	$	(19,401)	$	(16,791)	$	(17,518)
Tax benefit	$	1,377	$	5,957	$	5,061	$	5,094

7. Equity Transactions

Preferred Stock

The Company is authorized to issue 2.0 million shares of preferred stock with a par value of $0.0001 per share. The Company previously issued 1.5 million shares of preferred stock, all of which have converted to common stock. The remaining 0.5 million authorized shares of preferred stock remained undesignated and unissued as of September 30, 2025 and December 31, 2024. As of September 30, 2025 and December 31, 2024, there were no outstanding shares of preferred stock, as all previously designated and issued preferred stock was converted into common stock in prior periods.

Dividends

Stockholders are entitled to receive, when and if declared by the Company’s Board of Directors from time to time, dividends and other distributions in cash, stock or property from the Company’s assets or funds legally and contractually available for such purposes. The Company paid dividends of $0.14 per share of common stock for each of the three months ended March 31 and June 30, 2025, and a dividend of $0.15 per share of common stock for the three months ended September 30, 2025, resulting in total payments to stockholders of $46.9 million for the nine months ended September 30, 2025. Dividend payments for the nine months ended September 30, 2024 totaled $49.1 million. The Company’s liability related to dividends on common shares underlying unvested restricted stock units (“RSUs”) was $3.2 million and $2.5 million as of September 30, 2025 and December 31, 2024, respectively.

Share Repurchase Program

Since February 2021, the Company’s Board of Directors has authorized the repurchase of up to $1,500.0 million of the Company’s common stock, including the most recent approval in September 2024 of $500.0 million through December 31, 2027. This timeframe can be extended or shortened by the Board of Directors. Repurchases may be made from time to time on the open market at prevailing prices or in negotiated transactions off the market. The Company records share repurchases at cost, which includes broker commissions and related excise taxes. All shares are immediately retired upon repurchase in accordance with the board-approved policy. When treasury shares are retired, the Company’s policy is to allocate the excess of the repurchase price over the par value of shares acquired first, to additional paid-in capital, and then to retained earnings/accumulated deficit. The portion to be allocated to additional paid-in capital is calculated by applying a percentage, determined by dividing the number of shares to be retired by the number of shares outstanding, to the balance of additional paid-in capital as of the date of retirement.

During the three and nine months ended September 30, 2025, the Company repurchased and subsequently retired 1.9 million and 6.8 million shares of its common stock, respectively, for a total purchase price of $50.0 million and $185.0 million,

respectively. During the three and nine months ended September 30, 2024, the Company repurchased and subsequently retired 4.7 million and 9.8 million shares of its common stock, respectively, for a total purchase price of $129.0 million and $282.3 million, respectively. During the three and nine months ended September 30, 2025, the Company incurred $0.4 million and $1.5 million, respectively, of related taxes, which are not included in the total purchase price. Similarly, during the three and nine months ended September 30, 2024, the Company incurred $1.2 million and $2.7 million, respectively, of related taxes, which are not included in the total purchase price. In addition, in September 2024, the Company purchased 21,000 shares for $0.7 million, which were settled and retired in October 2024.

As of September 30, 2025, $245.3 million remained available and authorized for repurchase under this program.

8. Revenue

The following table summarizes the Company’s services revenue:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
	(In thousands)				(In thousands)
Commercial services revenue:
Voice and data	$	59,930	$	57,693	$	172,682	$	169,125
IoT data	46,707		43,695		135,303		124,759
Broadband	12,970		15,549		38,570		42,719
Hosted payload and other data	18,726		16,372		48,140		44,750
Total commercial services revenue	138,333		133,309		394,695		381,353
Government services revenue	26,910		26,546		80,410		79,546
Total services revenue	$	165,243	$	159,855	$	475,105	$	460,899

The following table summarizes the Company’s engineering and support services revenue:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
	(In thousands)				(In thousands)
Commercial	$	1,852	$	1,731	$	5,893	$	4,404
Government	38,333		29,016		113,638		82,569
Total engineering and support services revenue	$	40,185	$	30,747	$	119,531	$	86,973

Approximately 37% and 51% of the Company’s accounts receivable balance at September 30, 2025 and December 31, 2024, respectively, were due from prime contracts or subcontracts with agencies of the U.S. government.

The Company’s contracts with customers generally do not contain performance obligations with terms in excess of one year. As such, the Company does not disclose details related to the value of performance obligations that are unsatisfied as of the end of the reporting period. The total value of any performance obligations that extend beyond one year is immaterial to the financial statements.

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and deferred revenue (contract liabilities) on the condensed consolidated balance sheets. The Company bills amounts under its agreed-upon contractual terms at periodic intervals (for services), upon shipment (for equipment), or upon achievement of contractual milestones or as work progresses (for engineering and support services). Billing may occur subsequent to revenue recognition, resulting in unbilled accounts receivable (contract assets). The Company may also receive payments from customers before revenue is recognized, resulting in deferred revenue (contract liabilities). The Company recognized revenue that was previously recorded as deferred revenue in the amounts of $15.4 million and $12.0 million for the three months ended September 30, 2025 and 2024, respectively, and $45.5 million and $26.4 million for the nine months ended September 30, 2025 and 2024, respectively.

The Company has also recorded costs of obtaining contracts expected to be recovered in prepaid expenses and other current assets (contract assets or commissions), that are not separately disclosed on the condensed consolidated balance sheets. The commissions are recognized over the estimated usage period. The following table presents contract assets not separately disclosed:


	September 30, 2025		December 31, 2024
	(In thousands)
Contract Assets:
Commissions	$	1,323	$	1,058
Other contract costs	$	1,669	$	1,798

9. Leases

Operating leases in which the Company is a lessor consist primarily of hosting agreements with Aireon LLC (“Aireon”) (see Note 12) and L3Harris Technologies, Inc. (“L3Harris”) for space on the Company’s satellites. These agreements provide for a fee that will be recognized over the estimated useful lives of the satellites, currently estimated to be approximately 17.5 years from their respective in-service dates. Lease income related to these agreements was $3.1 million for each of the three months ended September 30, 2025 and 2024, and $9.3 million for each of the nine months ended September 30, 2025 and 2024. Lease income is recorded as hosted payload and other data service revenue within service revenue on the Company’s condensed consolidated statements of operations and comprehensive income.

Aireon has made payments to the Company pursuant to its hosting agreement (the “Aireon Hosting Agreement”), and the Company expects Aireon will continue to do so. L3Harris has prepaid all amounts owed to the Company pursuant to its hosting arrangement. The following table presents future income with respect to the Company’s operating leases in which it is the lessor existing at September 30, 2025, exclusive of the $9.3 million recognized during the nine months ended September 30, 2025, by year and in the aggregate:


Year Ending December 31,	Amount
	(In thousands)
2025	$	3,098
2026	12,391
2027	12,391
2028	12,391
2029	12,391
Thereafter	70,084
Total lease income	$	122,746

10. Stock-Based Compensation

In May 2025, the Company’s stockholders approved the amendment and restatement of the Company’s 2015 Equity Incentive Plan (as so amended and restated, the “Amended 2015 Plan”). As of September 30, 2025, the remaining aggregate number of shares available for future grants under the Amended 2015 Plan was 9,357,497. The Amended 2015 Plan provides for the grant of stock-based awards, including nonqualified stock options, incentive stock options, restricted stock, RSUs, stock appreciation rights and other equity securities to employees, consultants and non-employee directors of the Company and its affiliated entities. The number of shares of common stock available for issuance under the Amended 2015 Plan is reduced by (i) one share for each share of common stock issued pursuant to an appreciation award, such as a stock option or stock appreciation right with an exercise or strike price of at least 100% of the fair market value of the underlying common stock on the date of grant, and (ii) 1.8 shares for each share of common stock issued pursuant to any stock award that is not an appreciation award, also known as a “full value award.” The Amended 2015 Plan allows the Company to utilize a broad array of equity incentives and performance cash incentives in order to secure and retain the services of its employees, directors and consultants, and to provide long-term incentives that align the interests of its employees, directors and consultants with the interests of the Company’s stockholders. The Company accounts for stock-based compensation at fair value.

Restricted Stock Units

Beginning in 2024, the RSUs granted to employees for service vest over three years, with 34% vesting on the first anniversary of the grant date and the remainder vesting ratably on a quarterly basis thereafter, subject to continued employment. RSUs granted prior to March 2024 generally vest over four years, with 25% vesting on the first anniversary of the grant date and the remainder vesting ratably on a quarterly basis thereafter, subject to continued employment. Some RSUs granted to employees for performance vest upon the completion of defined performance goals, subject to continued employment. The RSUs granted to non-employee members of the Board of Directors generally vest in full on the first anniversary of the grant date. The RSUs

granted to non-employee consultants generally vest 50% on the first anniversary of the grant date, with the remaining 50% vesting quarterly thereafter through the second anniversary of the grant date.

The Company’s RSUs are classified as equity awards because the RSUs will be settled in the Company’s common stock upon vesting. The fair value of the RSUs is determined at the grant date based on the closing price of the Company’s common stock on the date of grant. The related compensation expense is recognized over the service period, or shorter periods based on the retirement eligibility of the grantees, and is based on the grant date fair value of the Company’s common stock and the number of shares expected to vest. The fair value of the awards is not remeasured at the end of each reporting period. RSUs do not carry voting rights until they are vested, although certain unvested RSUs are entitled to accrue dividend equivalent rights, and shares (including additional shares issuable upon satisfaction of any accrued dividend equivalent rights) are issued upon settlement in accordance with the terms of the award.

RSU Summary

The following tables summarize the Company’s RSU activity:


	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2024	3,870	$	32.56
Granted	2,163	30.89
Forfeited	(188)	37.20
Released	(1,690)	35.09
Outstanding at September 30, 2025	4,155	$	30.45
Vested and unreleased at September 30, 2025 (1)	560


	Shares Underlying RSUs	Weighted- Average Grant Date Fair Value Per RSU
	(In thousands)
Outstanding at December 31, 2023	2,795	$	40.24
Granted	2,497	30.07
Forfeited	(83)	38.24
Released	(1,197)	43.69
Outstanding at September 30, 2024	4,012	$	32.92
Vested and unreleased at September 30, 2024 (1)	525

(1) These RSUs were granted to the Company’s Board of Directors as a part of their compensation for board and committee service and had vested but had not yet settled, meaning that the underlying shares of common stock had not been issued and released.

Service-Based RSUs

The majority of the annual compensation the Company provides to non-employee members of its Board of Directors is paid in the form of RSUs. Some members of the Company’s Board of Directors may elect to receive the remainder of their annual compensation, or a portion thereof, in the form of RSUs. An aggregate amount of approximately 81,000 and 57,000 service-based RSUs were granted to the non-employee members of the Company’s Board of Directors as a result of these payments and elections during the nine months ended September 30, 2025 and 2024, respectively, with an estimated grant date fair value of $2.4 million and $1.9 million, respectively.

During the nine months ended September 30, 2025 and 2024, the Company granted approximately 1,272,000 and 1,579,000 service-based RSUs, respectively, to its employees, with an estimated aggregate grant date fair value of $38.9 million and $46.5 million, respectively.

Performance-Based RSUs

In March 2025 and 2024, the Company granted approximately 534,000 and 461,000 annual incentive, performance-based RSUs, respectively, to the Company’s executives and employees (the “Bonus RSUs”), with an estimated grant date fair value of $16.9 million and $13.7 million, respectively. Vesting of the Bonus RSUs is dependent upon the Company’s achievement of

defined performance goals over the respective fiscal year. The Company records stock-based compensation expense related to performance-based RSUs when it is considered probable that the performance conditions will be met. Substantially all of the Bonus RSUs granted in March 2024 vested in March 2025 upon the determination of the level of achievement of the performance goals. Management believes it is probable that substantially all of the Bonus RSUs granted in March 2025 will vest. The level of achievement, if any, of performance goals will be determined by the compensation committee of the Company’s Board of Directors and, if such goals are achieved, the 2025 Bonus RSUs will vest, subject to continued employment, in March 2026.

Additionally, in March 2025 and 2024, the Company granted approximately 269,000 and 303,000 long-term, performance-based RSUs, respectively, to the Company’s executives (the “Executive RSUs”), with an estimated aggregate grant date fair value of $8.5 million and $9.0 million, respectively. Vesting of the Executive RSUs is dependent upon the Company’s achievement of defined performance goals over a two-year period. The vesting of the Executive RSUs granted in each of March 2025 and 2024 will range from 0% to 200% of the number of shares underlying the Executive RSUs granted, in each case based on the level of achievement of the performance goals. If the Company achieves the performance goals, 50% of the number of Executive RSUs earned based on performance will vest on the second anniversary of the grant date, and the remaining 50% will vest on the third anniversary of the grant date, in each case subject to the executive’s continued service as of the vesting date, which may be accelerated based on the retirement eligibility of the grantees. During March 2025, approximately 23,000 shares underlying Executive RSUs granted in March 2023 were forfeited as a result of performance targets not being fully achieved for the performance period ended December 31, 2024. During March 2024, the Company awarded approximately 83,000 additional shares related to Executive RSUs granted in March 2022 as a result of over-achievement of performance targets for the performance period ended December 31, 2023.

11. Income Taxes

Income before income taxes and loss on equity method investments was $47.9 million and $111.4 million for the three and nine months ended September 30, 2025, respectively, while the income tax expense was $10.0 million and $19.6 million, respectively. The effective tax rate was 20.9% and 17.6% for the three and nine months ended September 30, 2025, respectively, which differed from the federal statutory rate of 21%, primarily due to a tax benefit from the deduction for foreign derived intangible income and U.S. tax credits, partially offset by discrete tax expense associated with stock compensation and nondeductible executive compensation.

Income before income taxes and loss on equity method investments was $30.9 million and $79.3 million for the three and nine months ended September 30, 2024, respectively, while the income tax expense was $6.0 million and $18.5 million, respectively. The effective tax rate was 19.4% and 23.3% for the three and nine months ended September 30, 2024, respectively, which differed from the federal statutory rate of 21%, primarily due to the discrete tax expense associated with stock compensation and nondeductible executive compensation, which was partially offset by the deduction for foreign derived intangible income.

12. Related Party Transactions

Aireon LLC and Aireon Holdings LLC

The Company’s satellite constellation hosts the Aireon® system. The Aireon system was developed by Aireon LLC, which the Company formed in 2011 and which received subsequent investments from several air navigation service providers (“ANSPs”) to provide a global air traffic surveillance service through a series of automatic dependent surveillance-broadcast (“ADS-B”) receivers on the Company’s satellites. Aireon has contracted to offer this service to ANSPs, which use the service to provide improved air traffic control services over the oceans, as well as polar and remote regions. Aireon also markets its data and services to airlines and other commercial users. The Company and the other Aireon investors hold their interests in Aireon Holdings LLC (“Aireon Holdings”) through an amended and restated LLC agreement (the “Aireon Holdings LLC Agreement”). Aireon Holdings holds 100% of the membership interests in Aireon LLC, which is the operating entity.

In June 2022, the Company entered into a subscription agreement with Aireon Holdings and invested $50.0 million in exchange for an approximately 6% preferred membership interest. The Company’s investment in Aireon Holdings is accounted for as an equity method investment. The carrying value of the Company’s investment in Aireon was $39.1 million and $41.5 million as of September 30, 2025 and December 31, 2024, respectively. The investments by the Company prior to June 2022 had previously been written down to a carrying value of zero.

At each of September 30, 2025 and December 31, 2024, the Company’s fully diluted ownership stake in Aireon Holdings was approximately 39.5%, which is subject to partial future redemption under provisions contained in the Aireon Holdings LLC Agreement.

Under the agreements with Aireon, Aireon will pay the Company fees of $200.0 million to host the ADS-B receivers, of which $118.5 million had been paid as of September 30, 2025. These fees are recognized over the estimated useful life of the satellites, which is expected to result in revenue of approximately $9.3 million per year. The Company recognized $2.3 million and $6.9 million of hosting fee revenue under the Aireon Hosting Agreement for each of the three and nine months ended September 30, 2025 and 2024, respectively.

Additionally, Aireon pays power and data services fees of approximately $23.5 million per year, in the aggregate for the delivery of air traffic surveillance data over the Iridium® system. The Company recorded $5.9 million of power and data service fee revenue from Aireon for each of the three months ended September 30, 2025 and 2024, and $17.6 million for each of the nine months ended September 30, 2025 and 2024. Receivables due from Aireon for power and data services totaled $2.0 million as of each of September 30, 2025 and December 31, 2024.

Under two services agreements, the Company also provides Aireon with administrative services and support services, the fees for which are paid monthly. Aireon receivables due to the Company under these two agreements totaled $0.5 million and $1.7 million at each of September 30, 2025 and December 31, 2024.

The Company and the other Aireon investors have agreed to participate pro rata, based on their fully diluted ownership stakes, in funding an investor bridge loan to Aireon. The Company’s maximum funding commitment for the bridge loan is $11.9 million. No bridge loan amounts were outstanding as of September 30, 2025 or December 31, 2024.

13. Net Income Per Share

The Company calculates basic net income per share by dividing net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. In periods of net income, diluted net income per share takes into account the effect of potential dilutive common shares when the effect is dilutive. Potentially dilutive common shares include (i) shares of common stock issuable upon exercise of outstanding stock options and (ii) contingently issuable RSUs that are convertible into shares of common stock upon achievement of certain service and performance requirements. The effect of potentially dilutive common shares is computed using the treasury stock method.

The following table summarizes the computations of basic and diluted net income per share:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
	(In thousands, except per share data)
Numerator:
Net income - basic and diluted	$	37,127	$	24,446	89,507		76,435



Denominator:
Weighted average common shares — basic	106,095		117,449		108,160		120,390
Dilutive effect of stock options	77		181		95		240
Dilutive effect of RSUs	304		481		591		631
Weighted average common shares — diluted	106,476		118,111		108,846		121,261

Net income per share - basic	$	0.35	$	0.21	$	0.83	$	0.63
Net income per share - diluted	$	0.35	$	0.21	$	0.82	$	0.63


ITEM 2.			MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

You should read the following discussion along with our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on February 13, 2025 with the Securities and Exchange Commission, or the SEC, as well as our condensed consolidated financial statements included in this Form 10-Q.

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking statements include those that express plans, anticipation, intent, contingencies, strategies, goals, targets or future developments, market trends, expected competition or otherwise are not statements of historical fact. Without limiting the foregoing, the words “believe,” “anticipate,” “plan,” “expect,” “intend” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on our current expectations and projections about future events, and they are subject to risks and uncertainties, known and unknown, that could cause actual results and developments to differ materially from those expressed or implied in such statements. The important factors described under the caption “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on February 13, 2025, as updated and supplemented by this Form 10-Q, could cause actual results to differ materially from those indicated by forward-looking statements made herein. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview of Our Business

We are engaged primarily in providing mobile voice and data communications services using a constellation of orbiting satellites. We are the only commercial provider of communications services offering true global coverage, connecting people, organizations and assets to and from anywhere, in real time. Our low-earth orbit, L-band satellite network provides reliable, weather-resilient communications services to regions of the world where terrestrial wireless or wireline networks do not exist or are limited, including remote land areas, open ocean, airways, the polar regions and regions where the telecommunications infrastructure has been affected by political conflicts or natural disasters.

We provide voice and data communications services to businesses, U.S. and foreign governments, non-governmental organizations and consumers via our satellite network, which has an architecture of 66 operational satellites with in-orbit spares and related ground infrastructure. We utilize an interlinked mesh architecture to route traffic across the satellite constellation using radio frequency crosslinks between satellites. This unique architecture minimizes the need for ground facilities to support the constellation, which facilitates the global reach of our services and allows us to offer services in countries and regions where we have no physical presence.

In the second quarter of 2024, we acquired Satelles, Inc., or Satelles, a provider of highly secure, satellite-based position, navigation and timing (PNT) services that complement and protect GPS and other Global Navigation Satellite System, or GNSS, reliant systems. Time synchronization and location data play an important role in the global economy, particularly for major industries supported by critical infrastructure, such as financial services, telecommunications, cyber-security and transportation. We believe the acquisition of Satelles’s business could generate substantial growth in our service revenue, as well as incremental equipment and engineering services revenue over the coming years from both government and commercial customers.

We sell our products and services to commercial end-users through a wholesale distribution network, encompassing approximately 120 service providers, 310 value-added resellers (VARs), and 85 value-added manufacturers (VAMs), which either sell directly to the end user or indirectly through other service providers, VARs or dealers. These distributors often integrate our products and services with other complementary hardware and software and have developed a broad suite of applications using our products and services targeting specific lines of business.

At September 30, 2025, we had approximately 2,542,000 billable subscribers worldwide, an increase of 60,000, or 2%, from approximately 2,482,000 billable subscribers as of September 30, 2024. We have a diverse customer base, with end users in land mobile, Internet of Things, or IoT, maritime, aviation and government.

Recent Developments

As a result of expected increased competition, including from Space Exploration Technologies Corp.’s (“SpaceX”) recently announced plans to develop a global direct-to-device satellite system enabled by its pending acquisition of 50MHz of S-band spectrum rights and licenses from EchoStar Corporation, we intend to build on our existing market strengths, with increased focus on areas of our business in which we can deliver specialized, differentiated services that are not easily duplicated. In addition to these specialized services, we will also evaluate potential acquisitions, including to expand or augment our service offerings to support new revenue streams that would not compete directly with new direct-to-device services.

Material Trends and Uncertainties

Our industry and customer base have historically grown as a result of:

•demand for remote and reliable mobile communications services;

•a growing number of new products and services and related applications;

•a broad wholesale distribution network with access to diverse and geographically dispersed niche markets;

•increased demand for communications services by disaster and relief agencies, and emergency first responders;

•improved data transmission speeds for mobile satellite service offerings;

•regulatory mandates requiring the use of mobile satellite services;

•a general reduction in prices of mobile satellite services and subscriber equipment; and

•geographic market expansion through the ability to offer our services in additional countries.

Nonetheless, we face a number of challenges and uncertainties in operating our business, including:

•our ability to maintain the health, capacity, control and level of service of our satellites;

•our ability to develop and launch new and innovative products and services;

•changes in general economic, business and industry conditions, including the effects of currency exchange rates;

•our reliance on a single primary commercial gateway and a primary satellite network operations center;

•increased competition or potential competition from other satellite service providers, including SpaceX following its recently announced plans to acquire a significant amount of spectrum enabling global direct-to-device services, and, to a lesser extent, from the expansion of terrestrial-based cellular phone systems and related pricing pressures;

•market acceptance of our products;

•regulatory requirements in existing and new geographic markets;

•challenges associated with global operations, including as a result of conflicts in or affecting markets in which we operate;

•rapid and significant technological changes in the telecommunications industry, including announced plans for global, satellite direct-to-device broadband services;

•our ability to generate sufficient internal cash flows to repay our debt;

•reliance on our wholesale distribution network to market and sell our products, services and applications effectively;

•reliance on a global supply chain, including single-source suppliers for the manufacture of most of our subscriber equipment and for some of the components required in the manufacture of our end-user subscriber equipment and our ability to purchase component parts that are periodically subject to shortages resulting from surges in demand, natural disasters or other events, including global pandemics and the imposition of tariffs; and

•reliance on a few significant customers, particularly agencies of the U.S. government, for a substantial portion of our revenue, as a result of which the loss or decline in business with any of these customers may negatively impact our revenue and collectability of related accounts receivable, including as a result of an extended government shutdown or the use of continuing resolutions.

Comparison of Our Results of Operations for the Three Months Ended September 30, 2025 and 2024


	Three Months Ended September 30,								Change
	2025		% of Total Revenue		2024		% of Total Revenue
($ in thousands)									Dollars		Percent
Revenue:
Services	$	165,243	73	%	$	159,855	75	%	$	5,388	3	%
Subscriber equipment	21,507		9	%	22,169		10	%	(662)		(3)	%
Engineering and support services	40,185		18	%	30,747		15	%	9,438		31	%
Total revenue	226,935		100	%	212,771		100	%	14,164		7	%

Operating expenses:
Cost of services (exclusive of depreciation
and amortization)	50,762		22	%	43,848		21	%	6,914		16	%
Cost of subscriber equipment	12,661		6	%	12,769		6	%	(108)		(1)	%
Research and development	4,944		2	%	6,189		3	%	(1,245)		(20)	%
Selling, general and administrative	35,508		16	%	43,953		21	%	(8,445)		(19)	%
Depreciation and amortization	52,975		23	%	51,160		23	%	1,815		4	%
Total operating expenses	156,850		69	%	157,919		74	%	(1,069)		(1)	%
Operating income	70,085		31	%	54,852		26	%	15,233		28	%

Other expense:
Interest expense, net	(22,593)		(10)	%	(24,246)		(11)	%	1,653		(7)	%

Other income, net	372		—	%	312		—	%	60		19	%
Total other expense, net	(22,221)		(10)	%	(23,934)		(11)	%	1,713		(7)	%
Income before income taxes and loss on equity method investments	47,864		21	%	30,918		15	%	16,946		55	%
Income tax expense	(10,003)		(4)	%	(6,005)		(3)	%	(3,998)		67	%
Loss on equity method investments	(734)		—	%	(467)		—	%	(267)		57	%
Net income	$	37,127	17	%	$	24,446	12	%	$	12,681	52	%

Revenue

Commercial Service Revenue


	Three Months Ended September 30,
	2025					2024					Change
	Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers	ARPU
	(Revenue in millions and subscribers in thousands)
Commercial services:
Voice and data	$	59.9	411	$	48	$	57.7	422	$	46	$	2.2	(11)	$	2
IoT data	46.7		1,991	7.95		43.7		1,902	7.79		3.0		89	0.16
Broadband (3)	13.0		16.3	265		15.5		16.7	309		(2.5)		(0.4)	(44)
Hosted payload and other data	18.7		N/A			16.4		N/A			2.3		N/A
Total commercial services	$	138.3	2,418			$	133.3	2,341			$	5.0	77

(1)Billable subscriber numbers shown are at the end of the respective period.

(2)Average monthly revenue per unit, or ARPU, is calculated by dividing revenue in the respective period by the average of the number of billable subscribers at the beginning of the period and the number of billable subscribers at the end of the period and then dividing the result by the number of months in the period. Billable subscriber and ARPU data is not applicable for hosted payload and other data service revenue items.

(3)Commercial broadband service consists of Iridium OpenPort® and Iridium Certus® broadband services.

For the three months ended September 30, 2025, total commercial services revenue increased $5.0 million, or 4%, from the prior year period primarily as a result of increases in IoT data, voice and data and hosted payload and other data services. Commercial IoT revenue increased $3.0 million, or 7%, for the three months ended September 30, 2025, compared to the same period of the prior year, driven by a 5% increase in billable subscribers and an increase in a contract with a large customer that was executed in the first quarter of 2024. Hosted payload and other data service revenue increased $2.3 million, or 14%, compared to the prior year period, primarily due to increases in PNT revenue. Commercial voice and data revenue increased $2.2 million, or 4%, for the three months ended September 30, 2025, compared to the same period of the prior year, primarily due to increased ARPU from price increases implemented during the quarter. Voice and data revenue growth is expected to continue through the remainder of 2025 as a result of the implementation of previously announced price actions. The increases in commercial services were partially offset by a decrease in commercial broadband revenue of $2.5 million, or 17%, for the three months ended September 30, 2025, compared to the prior year period. The prior year period includes non-recurring revenue recognition of $1.4 million, representing 9% of the year-over-year revenue decline. ARPU was $265 in the third quarter of 2025, as compared to $309 in the prior year period, primarily as a result of the non-recurring revenue recognized in the prior year period, as well as the increased prevalence of usage of our service as a companion service in the current year period. We expect the shift to companion services to continue at the historical pace through at least the remainder of 2025.

Government Service Revenue


	Three Months Ended September 30,
	2025			2024			Change
	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers
	(Revenue in millions and subscribers in thousands)
Government services	$	26.9	124	$	26.5	141	$	0.4	(17)

(1)Billable subscriber numbers shown are at the end of the respective period.

We provide airtime and airtime support to U.S. government and other authorized customers pursuant to our Enhanced Mobile Satellite Services (EMSS) contract. Under the terms of this agreement, which we entered into in September 2019, authorized customers utilize specified Iridium airtime services provided through the U.S. government’s dedicated gateway. The fee is not based on subscribers or usage, allowing an unlimited number of users access to these services. For the three months ended September 30, 2025, revenue increased slightly, reflecting the annual rate increases in the EMSS contract from $106.0 million to $107.0 million on September 15, 2024 and from $107.0 million to $110.5 million on September 15, 2025.

Subscriber Equipment Revenue

Subscriber equipment revenue decreased by $0.7 million, or 3%, for the three months ended September 30, 2025, compared to the prior year period, primarily as a result of a decrease in volume of handset sales, offset in part by an increase in volume of Short Burst Data® device sales.

Engineering and Support Service Revenue


	Three Months Ended September 30,
	2025		2024		Change
	(In millions)
Commercial engineering and support services	$	1.9	$	1.7	$	0.2
Government engineering and support services	38.3		29.0		9.3
Total engineering and support services	$	40.2	$	30.7	$	9.5

Engineering and support service revenue increased by $9.5 million, or 31%, for the three months ended September 30, 2025, compared to the prior year period, primarily due to increased work under certain government contracts, predominantly the contract with the Space Development Agency, or the SDA.

Operating Expenses

Cost of Services (exclusive of depreciation and amortization)

Cost of services (exclusive of depreciation and amortization) includes the cost of network engineering and operations staff, including contractors, software maintenance, product support services and cost of services for government and commercial engineering and support service revenue.

Cost of services (exclusive of depreciation and amortization) increased by $6.9 million, or 16%, for the three months ended September 30, 2025 from the prior year period, primarily as a result of the increase in work under certain government projects, including the SDA contract, as noted above.

Cost of Subscriber Equipment

Cost of subscriber equipment includes the direct costs of equipment sold, which consist of manufacturing costs, allocation of overhead, and warranty costs.

Cost of subscriber equipment decreased by $0.1 million, or 1%, for the three months ended September 30, 2025, compared to the prior year period, primarily due to the net decrease in volume of device sales, as noted above.

Research and Development

Research and development expenses decreased by $1.2 million, or 20%, for the three months ended September 30, 2025, compared to the prior year period based on decreased spending on device-related features for our network.

Selling, General and Administrative

Selling, general and administrative expenses that are not directly attributable to the sale of services or products include sales and marketing costs, as well as employee-related expenses (such as salaries, wages, and benefits), legal, finance, information technology, facilities, billing and customer care expenses.

Selling, general and administrative expenses decreased by $8.4 million, or 19%, for the three months ended September 30, 2025, compared to the prior year period, primarily due to decreases in equity compensation costs and a decrease professional fees, including stock appreciation rights in the current year resulting from a decrease in our stock valuation between the years.

Depreciation and Amortization

Depreciation and amortization expense increased by $1.8 million, or 4%, for the quarter ended September 30, 2025, compared to the prior year period, due to increased depreciation resulting from on-orbit spares launched in the second quarter of 2023 being subsequently placed into service and beginning to be depreciated.

Other Income (Expense), net

Interest Expense, Net

Interest expense, net decreased $1.7 million, or 7%, for the three months ended September 30, 2025, compared to the prior year quarter primarily reflecting the fees paid in the prior year that were incurred in connection with our increased Term Loan in the third quarter of 2024 that did not recur in 2025.

Other Expense, net

Other expense, net, was $0.4 million for the three months ended September 30, 2025, compared to $0.3 million for the prior year period, primarily as the result of changes in foreign currency exchange rates.

Income Tax Expense

For the three months ended September 30, 2025, our income tax expense was $10.0 million, compared to $6.0 million for the prior year period. The increase in income tax expense is primarily related to increased pre-tax book income in 2025 compared to 2024 and increased tax expense associated with stock compensation and nondeductible executive compensation.

Loss on Equity Method Investments

For the three months ended September 30, 2025, our loss on equity method investments was $0.7 million compared to a loss of $0.5 million in the prior year period.

Net Income

Net income was $37.1 million for the three months ended September 30, 2025, compared to $24.4 million for the prior year period. The $12.7 million improvement in net income was primarily the result of the increases in engineering and support services revenue and commercial services revenue and decreasing operating expenses, as described above.

Comparison of Our Results of Operations for the Nine Months Ended September 30, 2025 and 2024


	Nine Months Ended September 30,								Change
	2025		% of Total Revenue		2024		% of Total Revenue
($ in thousands)									Dollars		Percent
Revenue:
Services	$	475,105	72	%	$	460,899	75	%	$	14,206	3	%
Subscriber equipment	64,083		10	%	69,819		11	%	(5,736)		(8)	%
Engineering and support services	119,531		18	%	86,973		14	%	32,558		37	%
Total revenue	658,719		100	%	617,691		100	%	41,028		7	%

Operating expenses:
Cost of services (exclusive of depreciation
and amortization)	153,152		23	%	129,761		21	%	23,391		18	%
Cost of subscriber equipment	36,830		6	%	40,595		7	%	(3,765)		(9)	%
Research and development	14,640		2	%	19,899		3	%	(5,259)		(26)	%
Selling, general and administrative	115,887		18	%	127,487		21	%	(11,600)		(9)	%
Depreciation and amortization	157,479		24	%	151,680		24	%	5,799		4	%
Total operating expenses	477,988		73	%	469,422		76	%	8,566		2	%
Operating income	180,731		27	%	148,269		24	%	32,462		22	%

Other expense:
Interest expense, net	(67,169)		(10)	%	(68,706)		(11)	%	1,537		(2)	%

Other expense, net	(2,184)		—	%	(291)		—	%	(1,893)		651	%
Total other expense, net	(69,353)		(10)	%	(68,997)		(11)	%	(356)		1	%
Income before income taxes and gain (loss) on equity method investments	111,378		17	%	79,272		13	%	32,106		41	%
Income tax expense	(19,629)		(3)	%	(18,501)		(3)	%	(1,128)		6	%
Gain (loss) on equity method investments	(2,242)		—	%	15,664		3	%	(17,906)		(114)	%
Net income	$	89,507	14	%	$	76,435	13	%	$	13,072	17	%

Revenue

Commercial Service Revenue


	Nine Months Ended September 30,
	2025					2024					Change
	Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers (1)	ARPU (2)		Revenue		Billable Subscribers	ARPU
	(Revenue in millions and subscribers in thousands)
Commercial services:
Voice and data	$	172.7	411	$	46	$	169.1	422	$	45	$	3.6	(11)	$	1
IoT data	135.3		1,991	7.75		124.8		1,902	7.68		10.5		89	0.07
Broadband (3)	38.6		16.3	261		42.7		16.7	284		(4.1)		(0.4)	(23)
Hosted payload and other data	48.1		N/A			44.8		N/A			3.3		N/A
Total commercial services	$	394.7	2,418			$	381.4	2,341			$	13.3	77

(1)Billable subscriber numbers shown are at the end of the respective period.

(2)ARPU is calculated by dividing revenue in the respective period by the average of the number of billable subscribers at the beginning of the period and the number of billable subscribers at the end of the period and then dividing the result by the number of months in the period. Billable subscriber and ARPU data is not applicable for hosted payload and other data service revenue items.

(3)Commercial broadband service consists of Iridium OpenPort and Iridium Certus broadband services.

For the nine months ended September 30, 2025, total commercial services revenue increased $13.3 million, or 3%, from the prior year period primarily driven by increases in IoT data, voice and data and hosted payload and other data services revenue. Commercial IoT revenue increased $10.5 million, or 8%, for the nine months ended September 30, 2025, compared to the prior year period, driven by a 5% increase in IoT billable subscribers and an increase in a contract with a large customer that was executed in the first quarter of 2024. Commercial voice and data revenue increased $3.6 million, or 2%, from the prior year period, primarily due to increased ARPU from price increases implemented during the year. Voice and data revenue growth is expected to continue through the remainder of 2025 as a result of the implementation of the previously announced price actions. Hosted payload and other data service revenue increased $3.3 million, or 7%, compared to the prior year period, primarily due to increases in PNT revenue, partially offset by other data service contracts. Commercial broadband revenue decreased $4.1 million, or 10%, for the nine months ended September 30, 2025, compared to the prior year period, primarily due to a decrease in ARPU reflecting the increased prevalence of usage of our service as a companion service in the current year period and non-recurring revenue recognition of $1.4 million in the prior year period. We expect the shift to companion services to continue at the historical pace through at least the remainder of 2025.

Government Service Revenue


	Nine Months Ended September 30,
	2025			2024			Change
	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers (1)	Revenue		Billable Subscribers
	(Revenue in millions and subscribers in thousands)
Government services	$	80.4	124	$	79.5	141	$	0.9	(17)

(1)Billable subscriber numbers shown are at the end of the respective period.

We provide airtime and airtime support to the U.S. government and other authorized customers pursuant to our EMSS contract. Under the terms of this agreement, which we entered into in September 2019, authorized customers utilize specified Iridium airtime services provided through the U.S. government’s dedicated gateway. The fee is not based on subscribers or usage, allowing an unlimited number of users access to these services. For the nine months ended September 30, 2025, revenue increased slightly, reflecting contractual step ups in the EMSS contract in September 2024 and 2025, as described above.

Subscriber Equipment Revenue

Subscriber equipment revenue decreased $5.7 million, or 8%, for the nine months ended September 30, 2025, compared to the prior year period, primarily due to a decrease in volume of handset and Short Burst Data device sales.

Engineering and Support Service Revenue


	Nine Months Ended September 30,
	2025		2024		Change
	(In millions)
Commercial engineering and support services	$	5.9	$	4.4	$	1.5
Government engineering and support services	113.6		82.6		31.0
Total engineering and support services	$	119.5	$	87.0	$	32.5

Engineering and support service revenue increased $32.5 million, or 37%, for the nine months ended September 30, 2025 compared to the prior year period primarily due to increased work under certain government projects, including the contract with the SDA.

Operating Expenses

Cost of Services (exclusive of depreciation and amortization)

Cost of services (exclusive of depreciation and amortization) increased by $23.4 million, or 18%, for the nine months ended September 30, 2025 from the prior year period, primarily as a result of an increase in work under certain government engineering contracts, including the SDA contract, as noted above.

Cost of Subscriber Equipment

Cost of subscriber equipment decreased $3.8 million, or 9%, for the nine months ended September 30, 2025, compared to the prior year period, which was in line with the change in equipment revenue for the same period, as noted above.

Research and Development

Research and development expenses decreased by $5.3 million, or 26%, for the nine months ended September 30, 2025 compared to the prior year period based on decreased spending on device-related features for our network.

Selling, General and Administrative

Selling, general and administrative expenses decreased by $11.6 million, or 9%, for the nine months ended September 30, 2025 compared to the prior year period, primarily due to lower equity compensation costs and in professional fees, offset in part by increased spend related to our channel partner conference held in March 2025.

Depreciation and Amortization

Depreciation and amortization expense increased by $5.8 million, or 4%, compared to the prior year period due to increased depreciation resulting from on-orbit spares launched in the second quarter of 2023 being placed into service in 2025 and beginning to be depreciated.

Other Expense

Interest Expense, Net

Interest expense, net decreased $1.5 million for the nine months ended September 30, 2025 compared to the prior year period. The decrease resulted primarily from a decrease in the average borrowing rate and the refinancing fees expensed in the prior year that did not recur in 2025, offset in part by the increase in the outstanding debt balance as compared to the prior year period.

Other Expense, net

Other expense, net, was $2.2 million for the nine months ended September 30, 2025, compared to $0.3 million for the prior year period, primarily as the result of changes in foreign currency exchange rates.

Income Tax Expense

For the nine months ended September 30, 2025, our income tax expense was $19.6 million, compared to $18.5 million for the prior year period. The increase in income tax expense is primarily related to increased pre-tax book income in 2025 compared to 2024, partially offset by decreased tax expense associated with stock compensation and nondeductible executive compensation.

Gain (Loss) on Equity Method Investments

For the nine months ended September 30, 2025, our loss on equity method investments was $2.2 million, compared to a gain of $15.7 million for the prior year period. The change is primarily the result of the acquisition of Satelles in 2024, upon which we recorded a $19.8 million gain on our previously held equity method investment, offset by the portion of losses recorded on other equity method investments.

Net Income

Net income was $89.5 million for the nine months ended September 30, 2025, compared to $76.4 million for the prior year period. The change primarily resulted from improved operating income in the current year, as a result of increases in engineering and support services revenue and commercial services revenue, as noted above, offset in part by the prior year gain on the Satelles acquisition.

Liquidity and Capital Resources

Our primary sources of liquidity are cash provided by operations, cash and cash equivalents and our Revolving Facility. These sources are expected to meet our short-term and long-term liquidity needs, including payments for (i) required principal and interest on the Term Loan, which we expect to be approximately $95.0 million in interest over the next 12 months, based on the current interest rate, (ii) capital expenditures of approximately $90.0 million in 2025, (iii) working capital, (iv) potential share repurchases, and (v) anticipated cash dividend payments to holders of our common stock.

As of September 30, 2025, our total cash and cash equivalents balance was $88.5 million, down from $93.5 million as of December 31, 2024. While we borrowed $50.0 million under the Revolving Facility during the nine months ended September 30, 2025, and generated cash flows from operations, we used cash of $186.5 million to repurchase shares of our common stock, $46.9 million to pay dividends, and $66.8 million for capital expenditures.

Term Loan and Revolving Facility

Pursuant to a credit agreement, as amended and restated to date, or the Credit Agreement, we previously entered into a term loan totaling $1,500.0 million, or the Term Loan, and an accompanying $100.0 million revolving loan, or the Revolving Facility. The maturity dates of the Term Loan and Revolving Facility are September 2030 and September 2028, respectively. We borrowed an additional $125.0 million under the Term Loan in March 2024 and $200.0 million in July 2024. The additional amounts borrowed are fungible with the original $1,500.0 million, and have the same maturity date, interest rate and other terms.

The March 2024 Term Loan borrowings were used to complete the acquisition of Satelles, Inc. on April 1, 2024. In April 2024, we drew $50.0 million under our Revolving Facility for general corporate purposes, including the funding of repurchases of our common stock. This amount was repaid with the expansion of the Term Loan in July 2024. The remaining proceeds of the Term Loan expansion in July 2024 were used for general corporate purposes, including share repurchases. In the first half of 2025, we drew $50.0 million under our Revolving Facility for general corporate purposes, which amount remained outstanding as of September 30, 2025.

The Term Loan has been repriced on several occasions, most recently in June 2024, and currently bears interest at an annual rate equal to the Secured Overnight Financing Rate, or SOFR, plus 2.25%, with a 0.75% SOFR floor. We typically select a one-month interest period, with the result that interest is calculated using one-month SOFR. Interest is paid monthly on the last business day of the month. Principal payments, payable quarterly, are equal to $18.3 million per annum (approximately one percent of the full principal amount of the Term Loan following the July 2024 increase), with the remaining principal due upon maturity.

As of September 30, 2025 and December 31, 2024, we reported an aggregate of $1,774.7 million and $1,807.7 million in borrowings under the Term Loan, respectively. These amounts do not include $14.9 million and $16.9 million of net unamortized deferred financing costs as of September 30, 2025 and December 31, 2024, respectively. The net principal balance in borrowings in the accompanying consolidated balance sheets as of September 30, 2025 and December 31, 2024 amounted to $1,759.8 million and $1,790.9 million, respectively. As of September 30, 2025 and December 31, 2024, the fair value of our borrowings under the Term Loan was $1,683.8 million and $1,802.1 million, respectively.

The Revolving Facility bears interest at an annual rate equal to SOFR plus 2.5% (but without a SOFR floor) if and as drawn, with no original issue discount, a commitment fee of 0.5% per year on the undrawn amount, which may be reduced to 0.375% if we have a consolidated first lien net leverage ratio (as defined in the Credit Agreement) of less than 3.5 to 1.

The Credit Agreement contains no financial maintenance covenants with respect to the Term Loan. With respect to the Revolving Facility, we are required to maintain a consolidated first lien net leverage ratio of no greater than 6.25 to 1 if more than 35% of the Revolving Facility has been drawn, or subject to letter of credit exposure. As of September 30, 2025, the aggregate exposure under the Revolving Facility was above 35% and we were in compliance with all covenants. The Credit Agreement contains other customary representations and warranties, affirmative and negative covenants, and events of default.

The Credit Agreement restricts our ability to incur liens, engage in mergers or asset sales, pay dividends, repay subordinated indebtedness, incur indebtedness, make investments and loans, and engage in other transactions as specified in the Credit Agreement. The Credit Agreement provides for specified exceptions, including baskets measured as a percentage of trailing twelve months of earnings before interest, taxes, depreciation and amortization, or EBITDA, and unlimited exceptions in the case of incurring indebtedness and liens and making investments, dividend payments, and payments of subordinated indebtedness, based on achievement and maintenance of specified leverage ratios. The Credit Agreement permits repayment, prepayment, and repricing transactions. The Credit Agreement also contains an annual mandatory prepayment sweep mechanism with respect to a portion of our excess cash flow (as defined in the Credit Agreement) in the event our net leverage ratio rises above 3.5 to 1. Our mandatory excess cash flow prepayment, as specified in the Credit Agreement, was $28.5 million as of December 31, 2024. This amount was paid in the second quarter of 2025 and applied to our required quarterly principal payments. As a result, no quarterly principal payment was required for the quarter ended September 30, 2025, and no quarterly principal payment will be required for the remainder of 2025 or the first three quarters of 2026. As such, we have no amounts classified as short-term secured debt on our condensed consolidated balance sheet as of September 30, 2025.

U.S. Government

A significant portion of our revenues and cash flow are derived from U.S. government contracts. During the quarter ended September 30, 2025, we did not experience delays in receiving payments from U.S. government agencies. However, the U.S. government began a shutdown on October 1, 2025. None of our contracts have been impacted as a result; however, an extended government shutdown could result in a delay or suspension of funding for our U.S. government contracts and disrupt our cash flows and delay new contract awards.

Contractual Obligations

As of September 30, 2025, we had non-cancelable purchase obligations of approximately $11.6 million for inventory purchases with Benchmark, our primary third-party equipment supplier. Our purchase obligations, all of which are due during the next twelve months, did not change materially from the end of 2024.

Our most significant contractual long-term cash requirement is the repayment of the remaining principal amount under the Term Loan upon its maturity in 2030, which is expected to be $1,702.8 million, and repayment of any outstanding Revolving Facility in 2028, which is currently $50.0 million. We expect to refinance the Term Loan at or prior to maturity.

Dividends

Total dividends paid during the nine months ended September 30, 2025 and September 30, 2024 were $46.9 million and $49.1 million, respectively. While we expect to continue paying regular cash dividends, any future dividends declared will be at the discretion of our Board of Directors and will depend, among other factors, upon our results of operations, financial condition and cash requirements, as well as such other factors that our Board of Directors deems relevant. Our Board of Directors increased the quarterly dividend to $0.15 per share in the third quarter of 2025.

Share Repurchases

During the quarter, we repurchased and subsequently retired 1.9 million shares of its common stock under our previously announced share repurchase program at a total purchase price of $50.0 million. As of September 30, 2025, $245.3 million remained available and authorized for repurchase under this program through December 31, 2027. We have paused share repurchases to increase financial flexibility and will continue to evaluate the amount and timing of share repurchases under our share repurchase program, considering, among other factors, general market conditions, capital allocation priorities, general business conditions and other investment opportunities. The repurchase program does not obligate us to repurchase any specific amount of common stock and may be modified, suspended, or discontinued at any time without notice at the discretion of our Board of Directors.

Cash Flows

The following table summarizes our cash flows:


	Nine Months Ended September 30,
	2025		2024		Change
	(In thousands)
Cash provided by operating activities	$	291,478	$	271,166	$	20,312
Cash used in investing activities	$	(66,791)	$	(156,335)	$	89,544
Cash used in financing activities	$	(232,428)	$	(26,155)	$	(206,273)

Cash Flows Provided by Operating Activities

Net cash provided by operating activities for the nine months ended September 30, 2025 increased by $20.3 million from the prior year period. The changes in operating cash relate to increased net income and a decrease in non-cash income from equity method investments as the prior year included a gain on the acquisition of Satelles. These changes were offset by a working capital decrease of approximately $10.7 million, primarily due to recognition of deferred revenue and the change in employee-related accruals, offset by higher cash inflows associated with timing of customer and vendor payments.

Cash Flows Used in Investing Activities

Net cash used in investing activities for the nine months ended September 30, 2025 decreased by $89.5 million as compared to the prior year period, primarily as a result of the Satelles acquisition during the prior year period, offset in part by an increase in capital expenditures compared to the prior year period.

Cash Flows Used in Financing Activities

Net cash used in financing activities for the nine months ended September 30, 2025 increased by $206.3 million compared to the prior year period. Expenditures in the current year are primarily related to share repurchases and the payment of dividends, while the prior year period included cash inflow related to the additional $325.0 million in borrowings under the Term Loan, offset in part by share repurchases and the payment of dividends.

U.S. Tax Regulation Update

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA permanently extends certain expiring provisions of the Tax Cuts and Jobs Act, modifies the international tax framework, and restores certain favorable business tax provisions, among other changes. The legislation has multiple effective dates, with certain provisions effective in 2025 and others to be implemented through 2027. We have incorporated the impact of the new legislation into our year-to-date effective tax rate and continue to assess the impact on our consolidated financial statements.

Seasonality

Our results of operations have been subject to seasonal usage changes for commercial customers, and we expect that our results will be affected by similar seasonality going forward. March through October are typically the peak months for commercial voice services revenue and related subscriber equipment sales. In December 2024, a large IoT customer began to phase out its annual retail pricing plans and subsequently revised them in 2025. As a result, that customer’s annual billable subscribers may move to monthly plans which has impacted the seasonality of subscribers and may further do so in the future. We expect revenue to remain unaffected due to the fixed-price nature of our contract with this customer for 2025. U.S. government revenue and commercial IoT revenue have been less subject to seasonal usage changes.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations is based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP. The preparation of these financial statements requires the use of estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, useful lives of property and equipment, long-lived assets and other intangible assets, deferred financing costs, income taxes, stock-based compensation, and other estimates. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. There have been no changes to our critical accounting policies and estimates from those described in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on February 13, 2025.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

We had an outstanding aggregate balance of $1,774.7 million under the Term Loan as of September 30, 2025. Under our Term Loan, we pay interest at an annual rate equal to SOFR, plus 2.25%, with a 0.75% SOFR floor. Accordingly, we have been and

continue to be subject to interest rate fluctuations. Our Cap manages our exposure to interest rate movements on a notional amount of $1.0 billion of our Term Loan. The Cap provides the right for us to receive payment from the counterparty if one-month SOFR exceeds 1.436%. The interest rate was above the level of the Cap during each of the nine months ended September 30, 2025 and 2024. For every SOFR increase of 25 basis points above the level of the Cap, we expect our annual interest expense to increase by an additional $1.9 million related to the unhedged portion of the Term Loan.

In the first half of 2025, we drew down $50.0 million on our Revolving Facility for general corporate purposes, which amount remained outstanding as of September 30, 2025. The Revolving Facility bears interest at SOFR plus 2.5%, without a SOFR floor. For every SOFR increase of 25 basis points, we expect our annual interest expense to increase by approximately $0.1 million related to the Revolving Facility.

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, as well as accounts receivable. We maintain our cash and cash equivalents with financial institutions with high credit ratings and maintain deposits in excess of federally insured limits. The majority of our cash is invested into a money market fund invested in U.S. treasuries, agency mortgage-backed securities and/or U.S. government-guaranteed debt. Accounts receivable are due from both domestic and international customers. We perform credit evaluations of our customers’ financial condition and record reserves to provide for estimated credit losses. Accounts payable are owed to both domestic and international vendors.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our chief executive officer, who is our principal executive officer, and our chief financial officer, who is our principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, as of the end of the period covered by this report. In evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. In addition, the design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a control system, misstatements due to error or fraud may occur and not be detected.

Based on this evaluation, our chief executive officer and our chief financial officer concluded that our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms, and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting

During the quarter ended September 30, 2025, there were no changes in our internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II.

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

There are no material pending legal proceedings, other than routine litigation incidental to our business.

ITEM 1A. RISK FACTORS.

Our business is subject to risks and events that, if they occur, could adversely affect our financial condition and results of operations and the trading price of our securities. In addition to the other information set forth in this quarterly report on Form 10-Q, you should carefully consider the factors described in “Part I, Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the Securities and Exchange Commission on February 13, 2025, as supplemented by the following.

We could lose market share and revenue as a result of increasing competition from companies in the wireless communications industry, including cellular and other satellite operators, and from the extension of land-based communications services.

We face intense competition in all of our markets, which could result in a loss of customers and lower revenue and make it more difficult for us to enter new markets. We compete primarily on the basis of coverage, quality, portability, and pricing of services and products.

The provision of satellite-based services and products is subject to downward price pressure when capacity exceeds demand or as a result of aggressive discounting by some operators under financial pressure to expand their respective market share. In addition, we may face competition from new competitors, new technologies, or new equipment, including new and proposed LEO constellations and satellite direct-to-device services. For example, in September 2025, SpaceX signed an agreement to acquire certain rights and licenses to an aggregate 50MHz of S-band spectrum, and announced plans to develop a global satellite direct-to-device service using the acquired spectrum. Although development of such a direct-to-device service using the acquired spectrum faces regulatory, technical and business hurdles, if successfully deployed, it could significantly increase competition to portions of our business. In addition, we may face competition for our services in the United States from service providers with ancillary terrestrial component, or ATC, authorities who are designing a satellite operating business and a terrestrial component around their spectrum holdings. Finally, some of our competitors have announced plans for the launch of additional satellites. As a result of competition, we may not be able to successfully retain our existing customers and attract new customers.

In addition to our satellite-based competitors, terrestrial voice and data service providers, both wireline and wireless, could further expand into rural and remote areas and provide the same general types of services and products that we provide through our satellite-based system. Although satellite communications services and terrestrial communications services are not entirely interchangeable, the two compete in some markets and for some services. Consumers generally perceive terrestrial wireless voice communication products and services as cheaper and more convenient than those that are satellite-based. Many of our terrestrial competitors have greater resources, wider name recognition and newer technologies than we do. In addition, industry consolidation could negatively affect our competitive position by increasing the scale or scope of our competitors, thereby making it more difficult for us to compete in various market segments.

Our agreements with U.S. government customers, particularly the DoD, which represent a significant portion of our revenue, are subject to termination and renewal.

The U.S. government, through a dedicated gateway owned and operated by the DoD, has been and continues to be, directly and indirectly, our largest customer, representing 27% and 25% of our revenue for the years ended December 31, 2024 and 2023, respectively. We provide the majority of our services to the U.S. government pursuant to our EMSS, SDA, and EMSS capabilities and security sustainment services (“ECS3”) contracts. We entered into these contracts in September 2019, May 2022, and March 2024, respectively. The EMSS contract continues through September 2026 with one six-month extension option exercisable at the election of the U.S. government; the SDA contract had a base term until January 2025, and we are currently in the first of up to five one-year options exercisable at the election of the U.S. government to extend the term; and the ECS3 contract had a base term through March 2025, and we are currently in the first of up to four one-year extension options exercisable at the election of the U.S. government. The U.S. government may terminate these agreements, in whole or in part, at any time for its convenience. Our relationship with the U.S. government is also subject to the overall U.S. government policies, budget and appropriation decisions and processes. U.S. government budget and policy decisions, including with respect to defense spending, are based on government priorities and objectives, which are subject to change and are driven by numerous factors, including administration changes, geopolitical events and macroeconomic conditions, and are beyond our control. If the U.S. government terminates any or all of these agreements, we would lose a significant portion of our revenue.

In addition to budget policy uncertainty, government shutdowns, the use of continuing resolutions, and the federal debt ceiling could adversely affect the funding for our U.S. government contracts or entering into new contracts, including renewals. For

example, if the current government shutdown, which began October 1, 2025, continues for an extended period of time, we could experience a delay or suspension of funding for our U.S. government contracts and delay on new contract awards, which could disrupt our cash flows.

Further, operational control of some of our contracts has been moved from the Defense Information Systems Agency to the U.S. Space Force. In connection with this operational shift, changes in internal pricing and cost recovery have resulted in reduced subscribers under the EMSS contract. Lower subscriber use may negatively affect our ability to negotiate a renewal of the EMSS contract on favorable terms in 2026, which could reduce our revenue from that contract.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Issuer Purchases of Equity Securities


Period	(a) Total number of shares purchased	(b) Average price paid per share	(c) Total number of shares purchased as part of publicly announced plans or programs	(d) Maximum dollar value of shares that may yet be purchased under the plans or programs
July 1-31	473,809	$31.65	473,809	$280.3 million
August 1-31	609,319	$24.61	609,319	$265.3 million
September 1-30	823,068	$24.29	823,068	$245.3 million
Total	1,906,196	$26.22	1,906,196	—

Since initiating share repurchases in February 2021, our Board of Directors has authorized the repurchase of up to $1,500.0 million of our common stock, including the September 2024 authorization to repurchase up to $500.00 million through December 31, 2027. All shares included in the table above were purchased under this authorization in open market transactions. Amounts in the table above do not include commissions incurred or excise taxes payable in connection with the repurchases.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

Insider trading arrangements and policies

During the three months ended September 30, 2025, none of our directors or officers (as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended) adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408 of Regulation S-K.

ITEM 6. EXHIBITS.

The following list of exhibits includes exhibits submitted with this Form 10-Q as filed with the Securities and Exchange Commission.


Exhibit						Description
31.1						Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to section 302 of The Sarbanes-Oxley Act of 2002.
31.2						Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to section 302 of The Sarbanes-Oxley Act of 2002.
32.1*						Certifications of Principal Executive Officer and Principal Financial Officer pursuant to Rules 13a-14(b) and 15d-14(b) promulgated under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to section 906 of The Sarbanes-Oxley Act of 2002.
101.INS						Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document).
101.SCH						Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Documents.
104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).





*			These certifications are being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			IRIDIUM COMMUNICATIONS INC.

			By:			/s/ Vincent J. O’Neill
						Vincent J. O’Neill
						Chief Financial Officer (as duly authorized officer and as principal financial officer of the registrant)

Date: October 23, 2025

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Date	Price Target	Rating	Analyst
9/11/2025	$26.00	Strong Buy → Outperform	Raymond James
9/9/2025	$16.00	Neutral → Sell	BWS Financial
5/5/2025	$34.00	Outperform	Oppenheimer
4/22/2025		Mkt Perform → Outperform	William Blair
1/24/2025	$40.00	Overweight	Cantor Fitzgerald
2/16/2024	$30.00	Buy → Neutral	BWS Financial
2/15/2024		Outperform → Mkt Perform	William Blair
9/18/2023	$57.00	Hold → Buy	Deutsche Bank

SEC Form 10-Q filed by Iridium Communications Inc

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