Rendering of a BlackSky satellite. Photo: BlackSky

While BlackSky has lowered its full-year outlook for 2025, citing the “near term volatility” of the U.S. government budget process, CEO Brian O’Toole told investors on Thursday that BlackSky believes “the long term opportunities with the U.S. government remain strong.” 

Last month, BlackSky filed an update to its full-year outlook, cutting its growth forecast in half. BlackSky lowered revenue guidance from between $125 million and $142 million to between $105 million and $130 million. At the midpoint, that would represent 15% year-over-year growth, down from expected 31% year-over-year growth at the midpoint of previous guidance. 

This comes after the Fiscal Year 2026 budget request for the National Reconnaissance Office reportedly made significant reductions to the Electro-Optical Commercial Layer (EOCL) program that BlackSky is one of three providers on. O’Toole was one of a group of remote sensing CEOs that has called out the potential cuts as undermining national security in a letter to Congress. 

BlackSky has factored near-term U.S. government reductions into its guidance.  

“We’re seeing the effects of the current budget process and anticipated Continuing Resolution,” O’Toole told investors in BlackSky’s Q2 results call on Thursday. “We [have] good visibility into a number of our contracts and opportunities, and looked at a number of those scenarios, and factored that into our guidance.” 

In terms of the NRO contract, O’Toole said it’s “still very much a dynamic situation” in the Congressional markup process, and will play out over the coming months. 

In June, BlackSky won a $24 million order on the National Geospatial-Intelligence Agency (NGA) Luno A contract, which O’Toole said he believes is the largest single award to any provider on the Luno contract vehicle. 

BlackSky has been emphasizing international demand amid U.S. government contract uncertainty and noted that 85% of its funded backlog of over $350 million is from international customers. 

Yet O’Toole was positive about long-term prospects for working with the U.S. government. 

“We believe the long-term opportunities with the U.S. government remain strong as BlackSky’s capabilities are aligned to the Administration’s agenda of increased national defense leadership in space and the use of cost-effective commercial solutions for government programs,” he said. “New commercial acquisition strategies in the Space Force and emerging opportunities for programs like Golden Dome offer long-term opportunities for BlackSky, which we believe we are well-positioned to capitalize on with our portfolio of Gen-3 satellites and manufacturing, AI, and real-time software capabilities.” 

BlackSky reported $22.2 million in revenue in the second quarter of 2025, down 11% year-over-year. But leadership noted there was a large contract award in the first quarter of this year that pulled revenue from the second quarter.

For the first half of 2025, BlackSky reported 51.7 million in revenue — a 5% increase year-over-year.

Adjusted EBITDA for the second quarter of 2025 was a loss of $2.8 million, compared to an adjusted EBITDA of $2.1 million for the second quarter of 2024. The year-over-year decrease of $4.9 million was primarily due to overhead expenses related to the recently acquired LeoStella operations and from lower professional and engineering revenues.