H1 2026
Filed Aug 13, 2026H1 2026 consolidated revenue declined 25% to $167 million and adjusted EBITDA declined 55% to $57 million, while Telesat raised Telesat Lightspeed spending guidance following a $2.7 billion ESCP-P contract.
GEO revenue and adjusted EBITDA declined sharply, operating cash flow turned negative, and the company recorded a $710 million net loss. These pressures were accompanied by a $2.7 billion ESCP-P agreement, higher pro forma LEO backlog, and an expanded Lightspeed constellation plan.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Consolidated revenue, three months ended June 30, 2026other | $ 79,493 (in thousands of Canadian dollars) | – | decrease of 25% ($27 million) |
| Consolidated revenue, six months ended June 30, 2026other | $ 166,553 (in thousands of Canadian dollars) | – | decrease of 25% ($56 million) |
| Operating expenses, three months ended June 30, 2026other | $ (61,728 ) (in thousands of Canadian dollars) | – | – |
| Operating expenses, six months ended June 30, 2026other | $ (117,064 ) (in thousands of Canadian dollars) | – | – |
| Operating income, three months ended June 30, 2026other | $ (12,735 ) (in thousands of Canadian dollars) | – | – |
| Operating income, six months ended June 30, 2026other | $ (94,099 ) (in thousands of Canadian dollars) | – | – |
| Net income (loss), three months ended June 30, 2026other | $ (558,550 ) (in thousands of Canadian dollars) | – | – |
| Net income (loss), six months ended June 30, 2026other | $ (709,499 ) (in thousands of Canadian dollars) | – | – |
| Net income (loss) attributable to Telesat Corporation shareholders, three months ended June 30, 2026other | $ (165,782 ) (in thousands of Canadian dollars) | – | – |
| Net income (loss) attributable to Telesat Corporation shareholders, six months ended June 30, 2026other | $ (211,277 ) (in thousands of Canadian dollars) | – | – |
| Basic net income (loss) per common share attributable to Telesat Corporation shareholders, three months ended June 30, 2026other | $ (10.89 ) | – | – |
| Diluted net income (loss) per common share attributable to Telesat Corporation shareholders, three months ended June 30, 2026other | $ (10.89 ) | – | – |
| Basic net income (loss) per common share attributable to Telesat Corporation shareholders, six months ended June 30, 2026other | $ (14.16 ) | – | – |
| Diluted net income (loss) per common share attributable to Telesat Corporation shareholders, six months ended June 30, 2026other | $ (14.16 ) | – | – |
| Adjusted EBITDA, three months ended June 30, 2026non-GAAP | $ 22,093 (in thousands of Canadian dollars) | – | decrease of 62% ($37 million) |
| Adjusted EBITDA margin, three months ended June 30, 2026non-GAAP | 27.8 % | – | – |
| Adjusted EBITDA, six months ended June 30, 2026non-GAAP | $ 57,234 (in thousands of Canadian dollars) | – | decrease of 55% ($69 million) |
| Adjusted EBITDA margin, six months ended June 30, 2026non-GAAP | 34.4 % | – | – |
| Net cash (used in) generated from operating activities, six months ended June 30, 2026other | $ (71,868 ) (in thousands of Canadian dollars) | – | – |
| Net cash (used in) generated from investing activities, six months ended June 30, 2026other | $ (278,604 ) (in thousands of Canadian dollars) | – | – |
| Net cash (used in) generated from financing activities, six months ended June 30, 2026other | $ 212,950 (in thousands of Canadian dollars) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| GEO segment, three months ended June 30, 2026The decline was driven primarily by non-renewals of certain broadcast contracts in 2025 and, to a lesser extent, reductions in services for fixed broadband customers, partially offset by new contracts in the aviation vertical. | $78 million | – | 26% decline ($28 million) |
| GEO segment, six months ended June 30, 2026GEO adjusted EBITDA was $98 million, a 39% decline from the comparable period in 2025. Excluding expenses related to the Telesat GEO debt refinancing process, adjusted EBITDA was 30% lower and adjusted EBITDA margin was 73%. | $164 million | – | 26% decline ($57 million) |
2026 Financial Outlook outlook
- RevenueGEO revenue to be between $300 million and $320 million
- NoteGEO adjusted EBITDA to be between $210 million and $230 million, excluding non-recurring Telesat GEO debt refinancing costs
- NoteTotal spending on the Telesat Lightspeed program, including both expensed and capitalized costs, to be between $1.3 billion and $1.5 billion
- NoteTelesat Lightspeed spending forecast increased by $300 million from the prior range of $1.0 billion to $1.2 billion
- NoteAssumes an average foreign exchange rate of US$1=C$1.38
What drove it
- The $2.7 billion ESCP-P contract, including option periods, covers a 15-year period including option years and is expected to begin once Telesat Lightspeed enters commercial service.
- The ESCP-P contract includes milestone-based payments totaling $2.0 billion expected between Q3 2026 and Q4 2028. The payments will principally fund expansion of the Lightspeed constellation from 156 to 225 satellites.
- LEO backlog was $1.1 billion as of June 30, 2026; pro forma for the ESCP-P contract, LEO backlog would be $5.6 billion.
- GEO backlog was approximately $900 million as of June 30, 2026. Contract signings led to a sequential expansion of GEO backlog.
- Telesat is eligible to receive US$189 million in FCC Upper C-Band incentive payments, contingent upon meeting specified transition deadlines.
- Telesat Lightspeed spending was $337 million in the first six months of 2026, consisting of $40 million recorded as operating expense and $297 million as capital expenditure.
Concerns
- Consolidated revenue decreased 25% ($56 million) in the first six months of 2026 and GEO revenue decreased 26% ($57 million).
- First-half adjusted EBITDA decreased 55% ($69 million), while adjusted EBITDA margin was 34.4 % compared with 56.6 % in the prior year.
- The first-half net loss was primarily due to a loss on the change in fair value of Telesat Lightspeed Financing Warrants, a GEO goodwill impairment charge, lower adjusted EBITDA, and a foreign exchange loss associated with a weaker Canadian dollar on U.S. dollar-denominated debt.
- GEO satellite utilization was 60% at June 30, 2026, down approximately 2% from March 31, 2026 after adjusting for the retirement of Telstar 14R and Anik F4 during the quarter.
- The company continues to work toward refinancing Telesat GEO debt that starts to mature later in 2026.
What to watch
- Receipt of ESCP-P milestone payments totaling $2.0 billion expected between Q3 2026 and Q4 2028.
- Progress toward commencing global Telesat Lightspeed commercial service around the end of Q1 2028.
- Execution against 2026 GEO revenue guidance of between $300 million and $320 million and GEO adjusted EBITDA guidance of between $210 million and $230 million.
- Execution of total Telesat Lightspeed program spending guidance of between $1.3 billion and $1.5 billion.
- Meeting the specified FCC transition deadlines tied to US$189 million in potential incentive payments.
- Refinancing of Telesat GEO debt that starts to mature later in 2026.
Balance sheet and cash flow
- Cash and cash equivalents as of June 30, 2026: $ 383,241 (in thousands of Canadian dollars); December 31, 2025: $ 509,798 (in thousands of Canadian dollars).
- Current indebtedness as of June 30, 2026: $ 2,742,738 (in thousands of Canadian dollars); December 31, 2025: $ 2,341,145 (in thousands of Canadian dollars).
- Long-term indebtedness as of June 30, 2026: $ 1,051,429 (in thousands of Canadian dollars); December 31, 2025: $ 1,152,462 (in thousands of Canadian dollars).
- Cash payments related to satellite programs for the six months ended June 30, 2026: $ (178,181 ) (in thousands of Canadian dollars); prior year: $ (347,267 ) (in thousands of Canadian dollars).
- Cash payments related to property and other equipment for the six months ended June 30, 2026: $ (98,704 ) (in thousands of Canadian dollars); prior year: $ (69,945 ) (in thousands of Canadian dollars).
- Proceeds from indebtedness for the six months ended June 30, 2026: $ 230,286 (in thousands of Canadian dollars); prior year: $ 340,000 (in thousands of Canadian dollars).
- In August, Telesat borrowed US$120 million for general corporate purposes under a secured term loan agreement. The loan matures in four years and accrues interest based on SOFR plus an applicable margin.
Analysis
Telesat reported weaker first-half operating results under IFRS Accounting Standards. Consolidated revenue was $166.6 million, down 25% ($56 million), while adjusted EBITDA was $57.2 million, down 55% ($69 million). Adjusted EBITDA margin was 34.4 %, compared with 56.6 % in the prior-year period. The three-month pattern was similarly weak, with revenue of $79.5 million and adjusted EBITDA of $22.1 million.
The GEO business remained the source of the revenue decline. GEO revenue was $164 million in the six months ended June 30, 2026, down 26% ($57 million), and GEO adjusted EBITDA was $98 million, down 39%. Management attributed the quarterly GEO revenue decline primarily to broadcast-contract non-renewals in 2025 and, to a lesser extent, reduced fixed-broadband services, partly offset by new aviation contracts. GEO satellite utilization was 60% at June 30, 2026.
Reported earnings were affected by non-operating and non-cash items as well as operating deterioration. Telesat recorded a first-half net loss of $709.5 million, compared with net income of $24.1 million in the prior year. The company cited the increase in fair value of Telesat Lightspeed Financing Warrants, a GEO goodwill impairment charge, lower adjusted EBITDA, and foreign exchange losses on U.S. dollar-denominated debt. Operating cash flow was negative $71.9 million, versus positive $108.3 million in the prior-year period.
The strategic development was the $2.7 billion ESCP-P contract, including option periods, which increased the planned Lightspeed constellation to 225 satellites from 156 satellites. LEO backlog was $1.1 billion as of June 30, 2026 and would be $5.6 billion pro forma for the ESCP-P contract. The arrangement includes milestone-based payments totaling $2.0 billion expected between Q3 2026 and Q4 2028, principally to fund constellation expansion.
Management maintained GEO guidance of between $300 million and $320 million in revenue and between $210 million and $230 million in adjusted EBITDA excluding non-recurring refinancing costs. It raised total Lightspeed spending guidance to between $1.3 billion and $1.5 billion from the prior range of $1.0 billion to $1.2 billion. Liquidity and capital structure remain central, with $383.2 million of cash and cash equivalents, $2.7 billion of current indebtedness, and work continuing on refinancing Telesat GEO debt that starts to mature later in 2026.
Management, verbatim
It’s been an eventful past few months for Telesat and I’m very pleased with the rapid progress the company is making and the strong traction we’re seeing with customers for Telesat Lightspeed.
Dan Goldberg, President and CEO
Telesat Lightspeed is fully funded and we remain on track to commence global commercial service around the end of Q1 2028.
Dan Goldberg, President and CEO
In our GEO business, our efforts to drive resilient cash flow from our existing GEO satellite fleet resulted in contract signings that led to a sequential expansion of our GEO backlog.
Dan Goldberg, President and CEO
Not in the filing
stated, not guessed- Gross profit and gross margin were not reported.
- Free cash flow was not reported.
- Non-IFRS or adjusted EPS was not reported.
- LEO segment revenue was not reported.
- LEO segment adjusted EBITDA was not reported.
- Segment operating income was not reported.
- Dividend payments, share repurchases, and other capital-return programs were not reported.
- Guidance for gross margin, operating expenses, and tax rate was not reported.
- Previous-release outlook was not provided, so no reported results were compared with prior guidance.
- Quarterly cash flow statement was not reported.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.