Globalstar to Report Q3 Earnings: How to Approach the Stock Now?

Globalstar, Inc. (GSAT) will report its third-quarter 2025 results on Nov. 6, after market close.

GSAT’s earnings beat the Zacks Consensus Estimate in one of the trailing four quarters, while missing twice and matching in the remaining quarter. It has an average surprise of 7.19%.

Let us see how GSAT is expected to fare in terms of revenues and earnings this time.

The Zacks Consensus Estimate for the bottom line in the to-be-reported quarter is pegged at a loss of 3 cents compared with breakeven earnings reported in the prior-year quarter. The estimate has been unchanged in the past 60 days. The consensus estimate for total revenues is pinned at $68.27 million, implying a 5.6% year-over-year decline.

The company expects 2025 revenues to be between $260 million and $285 million, with adjusted EBITDA margins around 50%

What Our Model Predicts for GSAT’s Q3

Our proven model does not conclusively predict an earnings beat for GSAT this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. But that is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

GSAT has an Earnings ESP of 0.00% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors to Focus on Ahead of GSAT’s Q3 Earnings

Strength in service revenues, especially wholesale capacity services, is likely to have driven top-line numbers in the third quarter. Growth in the average number of subscribers, driven by increasing gross activations, is likely to have buoyed Commercial IoT performance. In the last reported quarter, Service revenues grew 10% year over year, driven by wholesale capacity services, which gained from the timing of service fees related to the reimbursement of network-related costs that have increased following network expansion.

Increasing adoption of the RM200 two-way module bodes well. RM200M module is the first satellite module to feature integrated GNSS, Bluetooth, an accelerometer and an application processor, enabling advanced two-way communication. It has been witnessing growing traction across verticals like oil & gas, defense and MVNOs, and tested by more than 50 partners. It recently announced the commercial availability of the 2-way module.

With XCOM RAN, GSAT is eyeing the terrestrial wireless markets, significantly broadening its total addressable market. Technical validation has been positive and management noted rising interest from prospective partners.

GSAT has been witnessing growing traction in the government, especially U.S. federal agencies and defense markets, which present another big growth opportunity amid increasing defense budgets. The company completed a proof of concept with Parsons, demonstrating integration of its satellite network with the latter’s software-defined communications platform across three European ground stations. It was followed by a capacity access agreement, moving the partnership into the commercial phase. This demonstrates Globalstar’s capability to deliver low-latency mission-critical communications for global government and defense applications.

Globalstar is in the midst of a comprehensive infrastructure upgrade and has launched its global ground infrastructure program for the next-generation Extended MSS Network, or the C-3 system. Under this program, it will add about 90 antennas across 35 ground stations in 25 countries, which will significantly boost network capacity and resiliency.

Globalstar, Inc. Price and EPS Surprise

Globalstar, Inc. price-eps-surprise | Globalstar, Inc. Quote

As a part of this, Globalstar recently deployed new ground station equipment in Talkeetna, AK, its first installation at this existing teleport. The site will host two new six-meter tracking antennas to support the third-generation C-3 mobile satellite system. In September, Globalstar announced doubling the size of the existing ground station in Estonia to support the third generation of its C-3 constellation. Previously, the company announced the construction of another gateway infrastructure at its current ground station at OTE S.A.’s commercial teleport in Nemea, Greece and an expansion to the Singapore ground station.

Lastly, GSAT’s biggest asset is its globally harmonized and licensed spectrum. Management highlighted that owning proprietary spectrum is the key differentiator in the satellite communications space as it provides a long-term competitive advantage.

However, a volatile macro backdrop remains concerning. Competition is also intensifying in the satellite and communication space amid the increasing demand for global connectivity. Other companies like Iridium Communications (IRDM), EchoStar (SATS) and Israel-based Gilat Satellite Networks (GILT) are eyeing significant expansion of their addressable markets.

Globalstar’s ongoing investment in XCOM RAN, a software-defined terrestrial wireless platform, represents both a strategic opportunity and a financial risk. In the second quarter, Globalstar invested heavily in the continued development and enhancement of XCOM RAN. These efforts, while increasing cash costs and pressuring adjusted EBITDA by approximately $1.9 million, also reduced the adjusted EBITDA margin by 300 basis points compared with the prior year.

Also, new product rollouts entail execution risks. Delays in client onboarding, technical troubles or slower commercialization could weigh on revenue growth.

GSAT Stock Surges

GSAT’s shares have skyrocketed 153.3% over the past six months. It has significantly outperformed the Satellite and Communication Industry and the Zacks S&P 500 composite’s rise of 146.8% and 23.4%, respectively.

GSAT’s Price Performance vs. Peers

Iridium stock is down 29% while shares of Gilat and EchoStar are up 122.2% and 215.6%, respectively, over the same time frame.

Key Valuation Metric for GSAT

GSAT stock is trading at a substantial premium, with a forward 12-month price/sales of 20.76X compared with the industry’s 1.53X.

In comparison, IRDM, SATS and GILT trade at multiples of 2.14X, 1.46X and 1.66X, respectively.

How to Approach GSAT Before Q3 Earnings Release

Globalstar has several promising catalysts in defense, IoT and hybrid connectivity. However, ongoing XCOM RAN investments could weigh on margins, while the increasingly crowded satellite industry poses a big challenge. While the company’s proprietary spectrum offers a solid strategic moat, stretched valuation is concerning. Existing investors may consider holding GSAT ahead of the third-quarter earnings for more clarity, while new investors can wait for a more favorable entry point.

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This article originally published on Zacks Investment Research (zacks.com).

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