Satellite Manufacturers Report Mixed Results for the Third Quarter
Earnings were a mixed bag for satellite manufacturers this quarter, and more than one company blamed few satellite orders for their lackluster bottom lines. Read on for some quick summaries of how manufacturers fared in the third quarter of 2017.
Orbital ATK’s third quarter results came in above analyst estimates with total revenue of $1.2 billion. Revenue came in 16.5 percent higher than the same period last year, primarily due to improved sales across all three of the company’s segments.
In its space systems group specifically, Orbital ATK reported sales of $314 million, up 26 percent year-over-year. Notably, Northrop Grumman announced in September that it will acquire Orbital ATK for a total of $9.2 billion. The two companies expect to close the deal during the first half of 2018.
Although Airbus reported a 2 percent increase in total revenue to 14.2 billion euros ($16.4 billion) from the same period last year, much of that was driven by the company’s commercial aircraft division. Airbus Defence and Space, on the other hand, saw a drop in revenue to 2.1 billion euros ($2.4 billion) compared to 2.2 billion euros ($2.5 billion) in the same period last year. Airbus pointed the finger at “the slow telecommunications satellite market” for the revenue dip.
Boeing fared similarly to Airbus; although Chief Executive Officer (CEO) Dennis Muilenberg said the company delivered a record 202 commercial airplanes during the quarter, its defense, space and security unit saw a 5 percent decline in revenue to $5.4 billion from the same period last year. The company’s biggest win during the quarter was a contract to build seven Medium Earth Orbit (MEO) satellites for operator SES.
Currently, the company’s defense, space and security unit has a backlog valued at $46 billion. Boeing also raised its full-year 2017 outlook, increasing cash flow guidance to $12.5 billion.
For the first nine months of the year, order intake for Thales’ aerospace division plummeted 18 percent to 3.04 million euros ($3.5 billion). Sales did see a slight 4.4 percent increase, with one major contract signed in the second quarter to build a Very High Throughput Satellite (V-HTS) for operator Inmarsat, as well as a contract in Q1 for another telecommuniations satellite for an undisclosed customer.
Nonetheless, Thales noted that “sales of tubes and imaging systems remained impacted by the weakening global satellite market.”