Eutelsat – Faiblesse dans la division Vidéo compensée par une hausse du CA dans la division Gouvernement

Research evidence excerpt

Eutelsat – Faiblesse dans la division Vidéo compensée par une hausse du CA dans la division Gouvernement

double to 0.9bn in FY26e in order to finance OneWeb’s second-generation constellation/

IRIS², while ramping up LEO revenue on OneWeb's existing (first) constellation. This implies free cash outflows (and thus, increased

net debt) and lower profitability at Eutelsat in the near term, exerting pressure on Eutelsat's credit ratings and gearing ratios.

Beyond these near-term cash flow pressures, Eutelsat may gain exposure to higher growth in connectivity markets, which could

prove challenging, as OneWeb faces stiff competition from ambitious large-scale LEO projects, which may put pressure on

LEO connectivity pricing and margins. In its traditional geostationary satellite connectivity business, Eutelsat continues to face

price declines in point-to-point data connectivity, as well as structural revenue erosion in the highly profitable video business,

as traditional DTH satellite broadcasters face competitive pressures from OTT services (Netflix, Amazon Prime Video, etc.). All

satellite businesses are subject to significant satellite construction delay risks, technical challenges for innovative services, and

launch risks (technical anomaly, satellite loss), usually covered by insurance, but potentially implying revenue opportunity losses.

State intervention is an additional risk for shareholders, as evidenced by the cancellation of Eutelsat’s ground infrastructure sale

to private equity firm EQT at the initiative of the French government.

Upside risks: Eutelsat’s LEO services are among the first to market and could enjoy early success, with a faster return to significant

FCF generation than we currently predict.