The 5 Most Interesting Analyst Questions From Globalstar's Q3 Earnings Call

Globalstar’s third quarter reflected continued momentum in satellite communications, with market reaction notably positive following the earnings announcement. Management credited the quarter’s outperformance to robust growth in wholesale capacity services and accelerating adoption of Commercial IoT (Internet of Things) devices. CFO Rebecca Clary highlighted that equipment revenue from IoT device sales rose sharply, supported by a surge in gross activations and subscriber growth. CEO Paul Jacobs pointed to the company’s progress in expanding its global ground infrastructure and the commercial availability of its two-way IoT module as key enablers of this growth. Additionally, improvements in operational efficiency and deliberate investments in business development contributed to overall financial stability, even as noncash items impacted net income.

Is now the time to buy GSAT? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Globalstar’s Q3 Earnings Call

• Michael Crawford (B. Riley Securities) asked whether improvements to the ground segment for the C-3 constellation can be used with current satellites. CEO Paul Jacobs confirmed that new antennas are specific to the C-3 system, while existing antennas serve the current constellation.
• Gregory R. Pendy (Clear Street) questioned whether Globalstar is gaining market share in IoT and how two-way module pricing will evolve. Jacobs explained that both market share gains and new applications are contributing, with aggressive pricing planned for the two-way system.
• Gregory R. Pendy (Clear Street) also asked about the growth in wholesale-enabled devices. Jacobs clarified that device counts reflect the number of devices with satellite modem capabilities, which continue to grow rapidly.
• Logan W Lillehaug (Craig-Hallum Capital Group) inquired about the return profile and profitability of XCOM RAN, as well as its margin impact. Jacobs stated that margins are solid, and growth is expected from new customer segments, but the business is still in an investment phase.
• Michael Ridgeway (Independent) sought details on the annuity component and profitability of XCOM RAN. Jacobs described a revenue model that includes equipment, spectrum, software licensing, and potential for a Network as a Service, with future margin accretion tied to customer base growth.

Catalysts in Upcoming Quarters

In upcoming quarters, the StockStory team will monitor (1) the pace of deployment for the new C-3 satellite infrastructure and associated ground network expansion, (2) customer adoption rates and revenue contribution from the two-way IoT module and XCOM RAN technologies, and (3) progress in securing and scaling government and enterprise contracts. We will also watch for developments in regulatory approvals and potential strategic transactions.

Globalstar currently trades at $64.23, up from $48.20 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members).

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