Core Viewpoint - Globalstar, Inc. is preparing to launch its HIBLEO-XL-1 satellite system, marking a significant step in enhancing mobile satellite connectivity [1] Company Summary - Globalstar, Inc. is a next-generation telecommunications infrastructure and technology provider [1] - The CEO, Dr. Paul Jacobs, emphasized that the introduction of HIBLEO-XL-1 will provide the company with significant optionality as it aims to grow as a major connectivity provider in the global space [1]

Core Insights - Globalstar, Inc. (GSAT) stock has increased by 37.3% over the past three months, but this is significantly lower than the Satellite and Communication Industry's growth of 141.8% [1][8] - The company reported second-quarter revenues of $67.1 million, an 11% year-over-year increase, driven by growth in wholesale capacity services and commercial IoT [5][8] - Globalstar is advancing innovative platforms like the RM200 two-way module and XCOM RAN, which are expected to enhance revenue streams [6][7] Price Performance - GSAT's stock closed at $30.29, down 2.7%, and is below its 52-week high of $41.10, raising questions about the sustainability of its momentum [4] - The stock is trading at a forward 12-month price/sales ratio of 12.78X, significantly higher than the industry average of 1.37X [16] Revenue Growth - The increase in second-quarter revenues was largely attributed to a 10% rise in service revenues, with wholesale capacity services being a key contributor [5][8] - Globalstar's revenue outlook for 2025 is projected to be between $260 million and $285 million, with expected adjusted EBITDA margins around 50% [15] Strategic Developments - The company is undergoing a comprehensive infrastructure upgrade, including the addition of approximately 90 antennas across 35 ground stations in 25 countries [9] - Globalstar signed a launch services agreement with SpaceX to deploy nine new satellites, scheduled for launch in late 2025 and 2026 [11] Client Expansion - GSAT is expanding its client base, particularly in the government sector, including partnerships with U.S. federal agencies and defense markets [12] - The company has completed a proof of concept with Parsons, moving into the commercial phase of collaboration [13] Competitive Landscape - Globalstar's proprietary spectrum is highlighted as a key competitive advantage in the satellite communications space [14] - The company faces competition from EchoStar, Iridium Communications, and Gilat Satellite Networks, with EchoStar recently selling spectrum licenses for approximately $17 billion [14] Valuation and Estimates - Analysts have raised earnings estimates for GSAT significantly, reflecting confidence in the company's long-term growth potential [18] - In comparison to peers, GSAT's stock has shown a notable performance, with Iridium declining by 35.8% while GILT and SATS have seen increases of 37.3% and 357.5%, respectively [19]

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Globalstar, Inc. (NASDAQ: GSAT ) is making strides in becoming a prominent communications satellite operator, expanding its Low Earth Orbit [LEO] constellation to enhance its service offerings for government & defense utilization, IoT, and MSS. With a new contract with an estimated valueMonte Independent Investment Research: Michael Del Monte is a buy-side equity analyst with over 5 years of industry experience. Prior to working in the investment management industry, Michael spent over a decade in professio ...

Core Viewpoint - Momentum investing focuses on following a stock's recent price trends, with the aim of buying high and selling higher, capitalizing on established price movements [1] Company Overview: Globalstar (GSAT) - Globalstar currently holds a Momentum Style Score of B, indicating a positive momentum outlook [2] - The company has a Zacks Rank of 1 (Strong Buy), suggesting strong potential for outperformance in the market [3] Performance Metrics - Over the past week, GSAT shares have increased by 12.1%, significantly outperforming the Zacks Satellite and Communication industry, which rose by 0.73% [5] - In a longer timeframe, GSAT's monthly price change is 29.29%, compared to the industry's 14.42% [5] - Over the last three months, GSAT shares have risen by 50.4%, and over the past year, they have increased by 59.71%, while the S&P 500 has only moved 9.68% and 16.9%, respectively [6] Trading Volume - GSAT's average 20-day trading volume is 754,674 shares, which serves as a bullish indicator when combined with rising stock prices [7] Earnings Outlook - In the past two months, one earnings estimate for GSAT has increased, while none have decreased, leading to a consensus estimate improvement from -$0.35 to -$0.08 [9] - For the next fiscal year, one estimate has moved upwards with no downward revisions during the same period [9] Conclusion - Given the strong performance metrics and positive earnings outlook, GSAT is positioned as a promising investment opportunity with a Momentum Score of B and a Zacks Rank of 1 (Strong Buy) [11]

Stock Picks - Global Star (GSAT) is a Zacks Rank 1 (Strong Buy) with an A for growth and an F for value, indicating a divergence that aggressive growth investors may find appealing [1][2] - Vimeo (VME) is also a Zacks Rank 1 (Strong Buy) with a B for both growth and value, potentially attracting value-conscious investors [10] Global Star (GSAT) Analysis - The company's revenue is expected to grow by 6% this year and triple to 18% next year, reaching $315 million [6] - Price to book is at nine times, while trading at 13 times sales, with margins improving from -14% and -13% to approximately 1% in the last two quarters, suggesting a potential profitability turnaround [7] - Earnings estimates have significantly improved, with next year's estimates moving from negative to positive by one penny, potentially driving investor interest [5] Vimeo (VME) Analysis - The company's earnings estimates are trending positively, but revenue growth is slow at 15% this year, with an expected acceleration to 5% next year [13] - The stock has a high forward earnings multiple of 66 times, but low price-to-book and price-to-sales ratios, which may interest value investors [14] - Margins are declining, from 6% to 4% and then to 3%, indicating a need for improved operational efficiency and bottom-line performance [15]

Core Insights - Globalstar, Inc. has commenced construction to expand its Singapore ground station, adding two 6-meter tracking antennas to support its third-generation C-3 mobile satellite system [1][11] - This expansion strengthens Globalstar's presence in Southeast Asia and aligns with its global efforts to enhance satellite coverage and network capacity [2] - The Singapore project is part of a broader C-3 expansion plan that includes approximately 90 new tracking antennas worldwide, aiming to meet the growing demand for mobile satellite communications [3] Financial Performance - In the last reported quarter, Globalstar achieved revenues of $67.1 million, reflecting an 11% year-over-year increase, driven by growth in wholesale capacity services and Commercial IoT [4] - The company reaffirmed its 2025 financial outlook, projecting total revenues between $260 million and $285 million, with an adjusted EBITDA margin of around 50% [7] Strategic Partnerships and Agreements - Globalstar signed a launch services agreement with SpaceX for its second set of replacement satellites and received FCC Space Bureau acceptance for its C-3 petition [4] - The company entered into a Cooperative Research and Development Agreement (CRADA) with the U.S. Army to test its edge-processing satellite solutions for defense applications [5] - In July, Globalstar announced agreements with Telecom Castilla-La Mancha, S.A. to expand its Alcazar Teleport facility in Spain, enhancing its capabilities in Europe [6] Stock Performance - Globalstar currently holds a Zacks Rank of 1 (Strong Buy), with its shares gaining 53.4% over the past year, compared to the Zacks Satellite and Communication industry's growth of 67.5% [8]

Group 1: Earnings Performance - Globalstar reported quarterly earnings of $0.13 per share, exceeding the Zacks Consensus Estimate of a loss of $0.09 per share, and improved from a loss of $0.15 per share a year ago, representing an earnings surprise of +244.44% [1] - The company posted revenues of $67.15 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 7.15% and increasing from $60.38 million year-over-year [2] Group 2: Stock Performance and Outlook - Globalstar shares have declined approximately 15.7% since the beginning of the year, contrasting with the S&P 500's gain of 7.9% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.06 on revenues of $68.23 million, and for the current fiscal year, it is -$0.35 on revenues of $261.71 million [7] Group 3: Industry Context - The Satellite and Communication industry, to which Globalstar belongs, is currently ranked in the bottom 33% of over 250 Zacks industries, indicating potential challenges for stock performance [8]

Financial Data and Key Metrics Changes - Total revenue increased by 11% to $67.1 million for Q2 2025 compared to $60.4 million in the prior year period [5] - Service revenue rose by 10%, primarily driven by wholesale capacity services and an increase in the average number of subscribers in commercial IoT [5] - Adjusted EBITDA increased to $35.8 million from $32.6 million in the prior year's second quarter, despite certain cost increases impacting adjusted EBITDA margin by 300 basis points [5][6] - Adjusted free cash flow for the six months ended June 30, 2025, was $77.9 million compared to $51.9 million in the prior year period [6] Business Line Data and Key Metrics Changes - Growth in commercial IoT was highlighted by a record number of growth activations over the last twelve months [5] - The XCOM RAN development incurred higher cash costs, negatively impacting adjusted EBITDA by approximately $1.9 million [6] Market Data and Key Metrics Changes - The company is well-positioned to manage potential financial impacts from evolving tariff environments due to its global manufacturing and logistics footprint [7] - The company anticipates a relatively immaterial impact from tariffs in the near term [7] Company Strategy and Development Direction - The company is focused on executing a clearly defined strategy to capture opportunities in government and commercial sectors, including investments in core infrastructure and strategic partnerships [11][12] - A global infrastructure program has been initiated to prepare for the next generation extended MSS network, with significant upgrades planned across multiple ground stations [12] - The company is expanding its presence in defense and government markets, with new agreements expected to contribute significantly to revenue [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term profitability and strategic importance of the XCOM RAN product offering despite upfront investments [6] - The company reiterated its full-year 2025 revenue outlook in the range of $260 million to $285 million, with an anticipated adjusted EBITDA margin of approximately 50% [7] Other Important Information - The company signed a launch services agreement with SpaceX for the deployment of additional satellites, expected to enhance service continuity [13][18] - The company is actively advancing its XCOM RAN platform, which is seen as a critical entry point into terrestrial wireless markets [16][17] Q&A Session Summary Question: Any updates on the international retail opportunity for terrestrial? - Management indicated progress in enterprise sales cycles and opportunities for expansion in the business [21][22] Question: Are there any other engagements in different verticals? - Management confirmed ongoing discussions with companies in high-demand network rollouts and positive developments in government projects [26][27] Question: Any updates on XCOM RAN as a potentially licensable technology? - Management noted challenges in licensing but emphasized strong technical validation and interest in their product [28][29] Question: Updates on international licenses and authorizations? - Management reported recent success in obtaining licenses in Mexico and ongoing efforts to secure higher power system authorizations [31][32] Question: Feasibility of spectrum sharing? - Management addressed misinformation about spectrum utilization and expressed confidence in their regulatory relationships [36][39]

[**PART I - FINANCIAL INFORMATION**](index=3&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Cautionary Statement About Forward-Looking Statements](index=3&type=section&id=Cautionary%20Statement%20About%20Forward-Looking%20Statements) This section outlines the nature of forward-looking statements, identifying key terms and factors that could cause actual results to differ from projections - **Forward-looking statements** include estimates, projections, business plans, expected operating results, anticipated financial resources, satellite performance, regulatory outcomes, and growth prospects[10](index=10&type=chunk) - **Important factors** that may cause actual results to differ materially include the ability to meet obligations under Updated Services Agreements, satellite operational performance, commercial acceptance of products, capacity needs, technological innovation, competition, geopolitical conditions, capital raising, cost management, spectrum rights, regulatory compliance, financing arrangements, cyber attacks, insurance, tax changes, litigation, strategic transactions, and business interruptions[11](index=11&type=chunk) [Item 1. Financial Statements.](index=4&type=section&id=Item%201.%20Financial%20Statements.) This section presents Globalstar, Inc.'s unaudited interim condensed consolidated financial statements, including statements of operations, balance sheets, stockholders' equity, and cash flows, with explanatory notes [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) - Net income significantly **improved** from a **loss of $(9,683) thousand** in Q2 2024 to a **profit of $19,208 thousand** in Q2 2025, and from a **loss of $(22,879) thousand** in H1 2024 to a **profit of $1,877 thousand** in H1 2025[15](index=15&type=chunk) Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenue | $67,148 | $60,385 | $127,180 | $116,865 | | Income (loss) from operations | $6,146 | $(1,422) | $(2,355) | $(6,134) | | Net income (loss) | $19,208 | $(9,683) | $1,877 | $(22,879) | | Net income (loss) per common share: Basic | $0.13 | $(0.10) | $(0.03) | $(0.22) | | Net income (loss) per common share: Diluted | $0.13 | $(0.10) | $(0.03) | $(0.22) | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) - **Total assets increased** by approximately **$198.9 million** from December 31, 2024, to June 30, 2025, primarily driven by **increases** in property and equipment, and prepaid network costs[18](index=18&type=chunk) Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Total assets | $1,909,149 | $1,710,237 | | Total liabilities | $1,548,269 | $1,351,354 | | Total stockholders' equity | $360,880 | $358,883 | [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) - **Total stockholders' equity** saw a **slight increase of $1,997 thousand** in the first six months of 2025, primarily due to net income, partially offset by other comprehensive loss and preferred stock dividends[22](index=22&type=chunk) Changes in Total Stockholders' Equity (in thousands) | Period | Balances – January 1, 2025 | Balances – June 30, 2025 | Balances – January 1, 2024 | Balances – June 30, 2024 | | :----- | :------------------------- | :----------------------- | :------------------------- | :----------------------- | | Total Stockholders' Equity | $358,883 | $360,880 | $378,979 | $382,975 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) - **Operating cash flow significantly increased** in H1 2025 to **$209.7 million**, but this was more than offset by a **substantial increase** in cash used for investing activities, leading to a **net decrease** in cash and cash equivalents of **$82.9 million**[27](index=27&type=chunk) Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $209,741 | $66,486 | | Net cash used in investing activities | $(271,788) | $(74,458) | | Net cash (used in) provided by financing activities | $(22,024) | $16,244 | | Net (decrease) increase in cash and cash equivalents | $(82,938) | $7,590 | [Notes to Unaudited Interim Condensed Consolidated Financial Statements](index=9&type=section&id=NOTES%20TO%20UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section provides detailed explanatory notes on Globalstar's accounting policies, significant transactions, and financial instrument specifics, supporting the interim condensed consolidated financial statements [1. Basis of Presentation](index=9&type=section&id=1.%20BASIS%20OF%20PRESENTATION) This note outlines the basis for preparing the interim condensed consolidated financial statements, confirming adherence to U.S. GAAP, detailing consolidation principles, and explaining retroactive adjustments - Globalstar, Inc. provides Mobile Satellite Services (MSS) through its global satellite network, with Thermo Companies as the principal owner and largest stockholder[29](index=29&type=chunk) - A **1-for-15 reverse stock split** was effectuated on **February 10, 2025**, retroactively adjusting all historical share and per share amounts in the report[33](index=33&type=chunk) - The company adopted **ASU 2023-09** (Income Taxes) effective **January 1, 2025**, and plans to adopt **ASU 2024-03** (Expense Disaggregation Disclosures) on **January 1, 2027**[34](index=34&type=chunk)[35](index=35&type=chunk) [2. Special Purpose Entity](index=10&type=section&id=2.%20SPECIAL%20PURPOSE%20ENTITY) This note details the Globalstar SPE, a variable interest entity established to manage the Extended MSS Network, primarily funded by Apple Inc. through prepayments and an equity interest - Globalstar provides wholesale capacity services to Apple Inc. ('Customer') under Updated Services Agreements, including for the new Extended MSS Network[36](index=36&type=chunk)[37](index=37&type=chunk) - The Globalstar SPE, a variable interest entity, owns the Extended MSS Network assets; the Customer holds a **20% equity interest** (**400,000 Class B Units for $400 million**), and Globalstar holds an **80% equity ownership**, consolidating the SPE into its financial statements[40](index=40&type=chunk)[41](index=41&type=chunk) - The Customer made an Infrastructure Prepayment of **up to $1.1 billion** and a **$235 million 2024 Debt Repayment** to fund the Extended MSS Network and retire existing debt[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) [3. Revenue](index=12&type=section&id=3.%20REVENUE) This note disaggregates revenue by product and service, showing an increase in wholesale capacity and subscriber equipment sales, alongside declines in SPOT and Duplex services - **Wholesale capacity services revenue increased** by **24%** for the three months ended June 30, 2025, and **21%** for the six months ended June 30, 2025, compared to the same periods in 2024, primarily due to the Updated Services Agreements[48](index=48&type=chunk)[148](index=148&type=chunk) - **Total contract liabilities** (deferred revenue) **increased** from **$349.4 million** at December 31, 2024, to **$524.5 million** at June 30, 2025, largely driven by advanced payments under the Infrastructure Prepayment[52](index=52&type=chunk)[55](index=55&type=chunk) Revenue Disaggregation (in thousands) | Revenue Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Wholesale capacity services | $42,385 | $34,075 | $79,094 | $65,287 | | Commercial IoT | $7,051 | $6,716 | $13,631 | $13,