Core Viewpoint - MDA Space Ltd. reported strong financial results for Q2 2025, showcasing significant growth in revenue and profitability, driven by increased work volumes and successful contract conversions, including a notable $1.8 billion contract with EchoStar for a LEO satellite constellation [2][3][8]. Financial Performance - The backlog at the end of Q2 2025 stood at $4.6 billion, providing revenue visibility for the year [8][9]. - Revenues for Q2 2025 reached $373.3 million, reflecting a 54% year-over-year increase [8][17]. - Adjusted EBITDA for Q2 2025 was $76.3 million, up 57% year-over-year, with an adjusted EBITDA margin of 20.4% [8][23]. - Adjusted net income for Q2 2025 was $48.1 million, a 106% increase compared to Q2 2024, resulting in adjusted diluted earnings per share of $0.38 [8][25]. - Operating cash flow for Q2 2025 was $52.8 million, with a net cash position of $416.8 million at quarter-end [8][9]. Business Segments - Revenue from the Satellite Systems segment in Q2 2025 was $232.6 million, a 113.8% increase year-over-year, driven by the Telesat Lightspeed program and Globalstar's next-generation LEO constellation [18][20]. - Robotics & Space Operations generated $88.0 million in revenue for Q2 2025, up 12.4% year-over-year, primarily due to the Canadarm3 program [18][20]. - Geointelligence revenues decreased by 4.0% year-over-year to $52.7 million, attributed to program timing [18][20]. Strategic Developments - MDA Space completed the acquisition of SatixFy Communications, enhancing its satellite systems offerings [4]. - The company finalized an agreement with the Canadian Space Agency to manage the David Florida Laboratory, a key facility for satellite integration and testing [5]. - MDA Space is focused on leveraging its capabilities to execute targeted growth strategies across its business areas, including investments in next-generation space technology and strategic M&A [10][11]. Updated Financial Outlook - For fiscal 2025, MDA Space updated its revenue guidance to $1.57 – $1.63 billion, representing approximately 48% year-over-year growth at the midpoint [12]. - The adjusted EBITDA range for 2025 is now projected to be $305 – $320 million, indicating a year-over-year growth of approximately 45% [12]. - The company expects Q3 2025 revenues to be between $385 – $415 million as it continues to execute on its backlog [13].

Core Insights - EchoStar Corporation has selected MDA Space Ltd. as the prime contractor for its new non-terrestrial network low Earth orbit direct-to-device satellite constellation, marking a significant step in the global space industry [1][4] - The initial contract is valued at approximately US$1.3 billion, with options that could increase the total value to about US$2.5 billion, indicating strong growth potential in satellite communications [2][8] - The constellation will comply with newly established NTN and 3GPP standards, enabling seamless connectivity for various services directly to standard 5G devices [3][4] Contract Details - The initial contract includes the design, manufacturing, and testing of over 100 software-defined MDA AURORA™ D2D satellites, with potential expansion to over 200 satellites [2][8] - Delivery of the satellites is planned for 2028, with commercial services expected to start in 2029, highlighting a long-term commitment to the project [8] Technical Features - The MDA AURORA™ D2D satellites will feature advanced technology such as a large user antenna, onboard processors compliant with 3GPP 5G NTN standards, and optical intersatellite links for robust connectivity [6][7] - The satellites will be manufactured at MDA Space's expanded facility in Montreal, which is undergoing a significant expansion of 185,000 square feet to accommodate increased production capacity [6][8] Market Positioning - EchoStar's selection of MDA Space as a contractor underscores MDA's leadership in the NTN market and its capability to meet the demands of satellite operators for direct-to-device and broadband connectivity [4][5] - The partnership aims to serve various sectors, including consumer, enterprise, public safety, and government, across the U.S. and Europe, leveraging EchoStar's existing terrestrial 5G network [4][5]