Abstract
Iridium will release its fourth-quarter 2025 results on February 12, 2026, Pre-Market, and investors are focusing on whether sequential momentum in profit can carry into the new year as service demand and equipment cycles shape mix.
Market Forecast
Consensus compiled from recent previews points to Iridium’s fourth-quarter 2025 revenue of $0.22 billion, gross profit margin near 72.05%, net profit margin around 16.36%, and adjusted EPS of $0.24, with year-over-year growth of 6.85% for revenue, 46.87% for adjusted EPS, and 9.08% for EBIT; revenue and EPS are in US dollars. The company’s mix continues to be led by Services at $0.17 billion, followed by Engineering and Support Services at $0.04 billion and User Equipment at $0.02 billion, with Services expected to be resilient on recurring access fees and wholesale contracts. The most promising segment remains Services, which contributes $0.17 billion and benefits from expanding IoT connections and aviation/land-mobile usage, with steady year-over-year growth implied by guidance.
Last Quarter Review
Iridium’s third-quarter 2025 results showed revenue of $0.23 billion, a gross margin of 72.05%, GAAP net profit attributable to the parent company of $0.04 billion, a net profit margin of 16.36%, and adjusted EPS of $0.35, with year-over-year growth in EPS of 66.67% and EBIT of 27.77%. The quarter’s net profit rose 69.00% sequentially, underscoring operating leverage as higher-margin services sustained mix despite softer equipment shipments. Main business highlights included Services revenue of $0.17 billion, Engineering and Support Services revenue of $0.04 billion, and User Equipment revenue of $0.02 billion, reflecting a portfolio anchored in recurring service revenues.
Current Quarter Outlook
Main Services Business
Iridium’s Services portfolio is the anchor for quarterly performance because it delivers recurring subscription and access revenues across commercial, government, aviation, maritime, and land-mobile customers. With the last quarter’s Services revenue at $0.17 billion and gross margin profile supported by network scale, the company’s margin stability into the fourth quarter hinges on churn containment and net-add growth in IoT and broadband. Contract renewals and government traffic typically provide seasonal steadiness, while commercial usage patterns can introduce modest variability; however, management’s prior commentary and the forecasted year-over-year increase in EPS to $0.24 suggest that Services mix should support earnings resilience. Pricing discipline and service tier upgrades are likely to contribute to gross margin preservation near 72.05%, and the associated net profit margin near 16.36% implies continued operating efficiency if equipment contributions do not dilate costs disproportionately.
User Equipment Cycle
Equipment shipments can be volatile quarter to quarter, but they carry strategic importance because device proliferation drives future service attach. The prior quarter’s equipment revenue of $0.02 billion sits well within historical ranges and reflects demand for handsets, satellite phones, and IoT terminals tied to enterprise and public sector deployments. For the fourth quarter, any production timing or channel inventory normalization will influence revenue recognition and mix, yet the EBIT forecast of $55.53 million points to healthy profitability even if equipment is flat to modestly lower. The market will watch closely whether newer device platforms and partner-led solutions produce incremental unit volumes that seed 2026 service growth, with minimal discount pressure and improved component availability supporting margin consistency.
Engineering and Support Services
Engineering and Support Services at $0.04 billion offer both integration revenue and technical services for complex customer implementations, including bespoke solutions for government and enterprise accounts. This segment’s contribution is smaller than Services but can provide useful top-line ballast and support long-term relationships that ultimately expand recurring service contracts. In the fourth quarter, project timing and milestone completions will dictate revenue pacing; the forecasted revenue increase of 6.85% year over year suggests a normal cadence rather than an outsized project wave. Investors will look for commentary on the backlog and pipeline conversion, as steady execution in this area tends to improve the predictability of future Services additions.
Stock Price Drivers This Quarter
The stock’s performance into and after the print will be influenced by how close reported results align with the EPS estimate of $0.24 and revenue of $0.22 billion, as well as management’s commentary on 2026 net adds and churn in IoT and broadband. Mix quality matters: an outcome with Services carrying revenue and margin while equipment remains controlled generally supports consensus assumptions for gross margin near 72.05%. Guidance on government contracts, aviation safety services, and wholesale partnerships can reset expectations on sustainability of the net profit margin around 16.36%. Any updates on capital intensity, constellation maintenance, or launch schedules will also factor into free cash flow visibility and investor sentiment.
Analyst Opinions
Across recent notes, the majority of analysts are constructive, anticipating year-over-year growth in revenue of 6.85% and adjusted EPS of 46.87% for the fourth quarter, with views anchored in durable Services momentum and contained equipment variability. Analysts cite improving IoT connection counts and expanding aviation/maritime demand as drivers of steady top-line and margin outcomes, with EBIT estimated at $55.53 million and an expectation of continued efficiency. The bullish cohort emphasizes Iridium’s recurring revenue base and operating leverage demonstrated by the prior quarter’s 69.00% sequential net profit growth, arguing that the setup is favorable so long as Services remain the dominant share of the mix and equipment cycles do not surprise negatively.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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