Eutelsat Projects Revenue Growth for 2027 as OneWeb Satellite Segment Expands
Eutelsat's Financial Performance and Market Position
By Gianluca Lo Nostro
Revenue Growth Outlook for 2027
Aug 7 (Reuters) - Eutelsat said on Friday it expected slight revenue growth in 2027 as rapid expansion of its OneWeb satellite connectivity business offsets declines elsewhere, though weaker-than-expected profitability sent its shares down as much as 8%.
The company said it expected slight growth in operating revenue in 2026/27, while profit margins were expected to remain broadly unchanged from last year.
Full-Year Revenue and Earnings Breakdown
Full-year revenue rose 3% on a like-for-like basis to €1.24 billion ($1.43 billion), driven by a 69.5% increase in low-Earth orbit (LEO) revenue, which accounted for a quarter of group sales. Adjusted core earnings, however, fell to €632.4 million and the profit margin dropped to 51.2%, below the 52.4% average analyst estimate compiled by the company.
Market Reaction and Analyst Commentary
Eutelsat's shares were down 7% at 0837 GMT. Bernstein analyst Aleksander Peterc said weak guidance was behind the market reaction despite a strong fourth quarter.
Finance chief Sebastien Rouge told analysts that Eutelsat was still in a phase where the rapidly growing LEO segment generated lower margins than the legacy geostationary business.
Comparisons with Competitors and Market Valuation
SpaceX IPO and Starlink Comparison
SPACEX IPO MAKES CASE FOR HIGHER VALUATION
The French group operates the only global LEO satellite network outside Elon Musk's Starlink and has benefited from European efforts to reduce reliance on U.S. satellite providers.
Chief Executive Jean-Francois Fallacher said the market was undervaluing Eutelsat relative to Starlink following SpaceX's stock market debut in June.
Insights on Starlink's Revenue Sources
"When we look at the valuation of Starlink we believe we are undervalued as a company, looking at the asset we are currently running and operating," Fallacher said.
He added that SpaceX's disclosures highlighted the scale of Starlink's dependence on revenue from the U.S. government, which was a surprise.
Additional Information
($1 = 0.8678 euros)
(Reporting by Gianluca Lo Nostro; Editing by Matt Scuffham)
