Eutelsat Revenue Dips in First Quarter of FY 2023-24

Eutelsat’s headquarters in Paris. Photo: Eutelsat

Eutelsat Communications operating vertical revenues in the first quarter of the operator’s 2023-24 fiscal year were down 2.4% compared to the same time last year on a like-for-like basis. Eutelsat reported financial results on Thursday, also reporting Konnect VHTS satellite that launched more than a year ago entered service. 

Konnect VHTS will provide fixed, mobile and government connectivity across Europe, North Africa and the Middle East. The satellite has Ka-band capacity of 500 Gbps, and is the largest Geostationary Orbit (GEO) satellite to date in Europe. Eutelsat reported it has firm commitments for the satellite totaling 450 million euros ($474 million). 

Among Eutelsat’s operating verticals, Video revenue was down during the quarter 9.5% year-over-year. Government Services revenue was flat and Fixed Connectivity took a slight dip, down 2.6% year-over-year. Despite the dip in Fixed Connectivity revenue, Eutelsat still expects double-digit growth for this segment in the fiscal year. 

Mobile Connectivity had standout growth and revenues of 35 million euros ($37 million), were up 44% year-over-year. Eutelsat said Mobile Connectivity’s growth was due to commercializing the final beam of the Quantum satellite for a maritime mobility client, and the 10B satellite’s entry into service. Eutelsat recently secured a deal with Marlink for capacity on the 10B satellite. 

For the full year, Mobile Connectivity is expected to see double-digit growth driven by strong demand for both GEO and Low-Earth Orbit (LEO) connectivity solutions, now that Eutelsat has acquired OneWeb. 

Eutelsat’s backlog stands at 3.4 billion euros ($3.6 billion) at the end of September, broadly stable from the end of June. Video is a decreasing portion of the backlog and now accounts for 57% of Eutelsat’s backlog, versus 63% a year ago. 

The company reported strong commercial momentum at OneWeb with a backlog close to $1 billion euros ($1.05 billion), up 66% year-on-year. 

“The constellation is already generating revenues across several verticals, such as data in Alaska, where OneWeb provides connectivity solutions for remote business sites, as well as community Wi-Fi. It is on track to reach global coverage by the end of the year,” Eutelsat CFO Christophe Caudrelier told investors on Thursday. 

Caudrelier gave some insight into the second generation of OneWeb, saying the first generation of satellites is expected to last until at least 2027. The company still expects the second constellation to be launched by 2027, he said. Eutelsat has not yet announced a manufacturer for the second generation. 

The Eutelsat Group financial objectives, including OneWeb, replace Eutelsat’s previous financial objectives. The group expects revenue to grow at a double-digit revenue CAGR over the medium to long-term, reaching 1.32 billion euros to 1.42 billion euros in fiscal year 2024, reaching 2 billion euros in fiscal year 2027.