Summary

• Low-Earth-orbit revenue reached €297 million, up 69.5% like for like, and now accounts for 25% of Eutelsat revenue.
• The expansion continues a multi-year shift towards connectivity as structural weakness persists across parts of the geostationary business.
• European sovereign communications can provide important anchor demand, but OneWeb still has to support the economics of an expensive satellite network.

Eutelsat is becoming materially more dependent on OneWeb, with low-Earth-orbit revenue reaching €297 million in the year to June and rising from roughly 15% to 25% of group revenue in twelve months.

The 69.5% like-for-like increase gives Eutelsat considerably more evidence that the OneWeb acquisition is changing its commercial mix rather than simply adding a strategically useful network to an established satellite business. Total revenue reached €1.236 billion, while revenue from its four operating verticals rose 1.8% like for like, so most of the underlying expansion was concentrated in the newer LEO operation rather than spread evenly across the group.

Profitability moved in the other direction, with adjusted EBITDA falling 3.1% like for like to €632.4 million and the margin declining by 3.2 percentage points to 51.2%. Eutelsat expects LEO growth to offset structural decline in geostationary services during the current financial year, which leaves OneWeb carrying more of the work required to keep group revenue moving forward.

Chief executive Jean-François Fallacher said: “Our Low Earth Orbit business continued its strong momentum, with revenues increasing by nearly 70%”. Although the increase is substantial, the underlying direction is not new: Eutelsat has spent several years moving towards a multi-orbit model, and the latest accounts show that strategy becoming large enough to alter the financial shape of the company.

LEO has to pay its way

As OneWeb becomes a larger share of Eutelsat, the commercial test moves beyond whether customers want low-latency satellite connectivity and towards whether demand can support the cost of maintaining the constellation. Satellites require replenishment, launches and ground infrastructure, while terminals, spectrum, distribution partnerships and network operations all sit between orbital capacity and a recurring customer contract.

Those costs make customer density important. Government communications, enterprise connectivity, aviation, maritime services and telecoms backhaul can all use LEO networks, although each market has different sales cycles and requirements, while customers can also compare satellite links with terrestrial fibre, mobile networks and other orbital systems. High revenue growth therefore provides useful momentum without removing the need to keep enough of an expensive network occupied.

Eutelsat’s existing geostationary assets complicate the transition further because they remain economically important even as mature activities decline. The group cannot simply replace one network architecture with another; it has to manage both while directing investment towards the part of the portfolio expected to generate future growth.

Sovereign demand brings a second customer base

European governments increasingly view satellite connectivity as infrastructure with security and resilience value, which gives Eutelsat access to demand that is not determined solely by the economics of ordinary enterprise telecoms. The company has secured work under the French Armed Forces’ NEXUS framework and is positioned within Europe’s IRIS² programme, where policymakers want communications infrastructure that reduces dependence on systems controlled outside Europe.

Public contracts can give a capital-intensive network valuable long-term visibility, although strategic importance does not remove the commercial requirement to operate efficiently. Europe still needs satellite operators capable of maintaining constellations, replacing spacecraft and serving customers after individual procurement programmes or political priorities have changed.

The relationship between commercial and sovereign demand consequently works in both directions. A broad enterprise customer base can make strategically important infrastructure less dependent on government funding, while public contracts can provide the stability needed to sustain capacity that also serves private customers across regions and industries.

OneWeb has now reached the point where those questions sit directly inside Eutelsat’s accounts. The coming year will show whether LEO growth can continue offsetting geostationary decline while the group stabilises profitability, which is a more demanding measure of the transition than the size of the revenue increase alone.