Deployment of the OneWeb network continues to slip, causing new owner Eutelsat to trim revenue expectations for the current fiscal year. Additionally, the company has withdrawn its previously published guidance for FY2024-2025, subject to reissuance in August 2024.
The company specifically calls out delays in deploying the ground network for the OneWeb constellation, needed to deliver its nearly global coverage footprint, as a drag on network activation and revenues. Additionally, the slower rollout shifts revenue towards lower margin hardware sales (i.e. getting terminals to customers) rather than the higher margin data traffic.
Under the revised guidance revenues are expected in the range of €1.25bn-€1.3bn, down from €1.32bn-€1.42bn previously. Adjusted EBITDA is expected in a range of €650m-€680m, previously at €725m-€825m.
Despite these shortcomings on the OneWeb deployment, the company says its Eutelsat 10B and Konnect VHTS satellites successfully entered service and are delivering strong revenue so far. CEO Eva Berneke also notes strength in pre-signed commitments for capacity from major customers, such that the company “remains very confident in the commercial customer interest in the capacity.”
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Separately, Airbus announced Monday that is has bought out Eutelsat-OneWeb’s stake in their shared satellite production facility. The facility shifted operations on its Merritt Island, Florida factory line to produce Arrow450. It will also expand the facility to meet increased demand for small satellites from commercial and government customers.
Given no need to produce more OneWeb Gen 1 satellites, it makes sense for the company to exit that business.
More on OneWeb’s commercial aviation progress:
- Intelsat successfully tests Stellar Blu ESA in LEO/GEO service
- Alaska Airlines picks Intelsat for E175 streaming WiFi upgrade
- Eutelsat 10B enters service
- Air Canada expands Intelsat partnership for in-flight Wi-Fi on 737 MAX, regional jets
- KONNECT VHTS comes online, boosting Eutelsat capacity
- Delta selects Hughes to complete Wi-Fi upgrades
- American taps Intelsat for high speed Wi-Fi on regional fleet
- Aerolineas Argentinas taps Intelsat for LEO/GEO inflight internet
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