Gilat Satellite Networks Ltd.

Ladies and gentlemen, thank you for standing by. Welcome to Gilad's second quarter 2025 results conference call. Participants are present in listen-only mode. Following management's formal presentation, instructions will be given for the question and answer session. As a reminder, this conference is being recorded August 26, 2025. By now, you should have all received the company's press release. If you have not received it, please view it in the news section of the company's website, www.gilott.com. I would now like to hand over the call to Mr. Alex Vialta of Alliance Advisors IR. Mr. Vialta, would you like to begin, please?

Thank you, Operator, and good day to everyone. Thank you for joining us for Gilott Satellite Network's earnings conference call for the second quarter of 2023. With us on today's call are Mr. Avi Stavia, Gilad's CEO, and Mr. Gil Benyamini, Gilad's CFO. The earnings press release was issued earlier today, and if anyone has not received a copy, I invite you to visit the company's website at Gilad.com, where you'll find the release in the investor relations section. Before turning the call over to management, I'd like to remind everyone that some statements made during the conference call contain forward-looking statements based on current expectations. Actual results could differ materially from these projected as a result of various risks and uncertainties. The potential risks and uncertainties could cause actual results to differ materially, include uncertain global economic conditions, reductions in revenues from key customers, delays or reductions in U.S. and foreign military spend, acceptance of our new products on a global basis, and disruptions or delays in our supply of raw materials and components due to business conditions global conflicts, weather, or other factors not under our control. The company cautions investors not to place undue reliance on forward-looking statements, which reflect the company's analysis only as of today's date. The company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances. Further information on these factors and other factors could affect KeyLot's financial results, is included in the company's filings at the SEC, including the latest quarterly report on Form 10-Q. In addition, on today's call, management will refer to certain non-GAAP financial measures that management considers to be useful and differ from GAAP. These non-GAAP measures should be considered supplemental to corresponding GAAP figures. With that, I would now like to turn the call over to ILAC CEO, Adi. Please go ahead, Adi.

Thank you, Alex, and good day, everyone. Thank you for joining us today to discuss Gilad's second quarter 2025 results. Please note that we are posting a PowerPoint presentation on our website with all the data we will discuss today. The second quarter not only showed strong performance, but also validated our growth strategy across each of our growth engines. Our priorities in 2025 remains on capturing the growing opportunities emerging from our acquisition of StellarBlue earlier this year, and investing in Gilad Defense to better positioned to drive revenue growth in 2026. These drivers, along with our strong presence in VHTS and NGSO constellations, continue to fuel our growth and strengthen our market leadership. Second quarter revenues reached $105 million, a 37% increase year over year, which includes about $36 million in revenues from Stellar Blue. Adjusted EBITDA was $11.8 million, 17% above the same quarter last year, including Stellar Blue's expected ramp-up losses of about $1.5 million. Excluding Stellar Blue loss, our adjusted EBITDA for the second quarter was about $13.3 million, representing a 32% year-over-year increase. Stellar Blue's yearly performance remains on track, with revenue expectation of between $120 million and $150 million. Now on to the business review. In the second quarter, our defense division continued to set the foundation for future growth. Continuing geopolitical tension and shifting global security priorities are promoting governments to increase their defense spending and allocate more of their budget to secure satellite communications. This is generating increased interest in mission-critical SATCOM solutions and Gilad Defense is well positioned to meet these evolving operational needs. We are seeing active engagement from customers across multiple regions, including North America, Europe, and Asia Pacific. Gilad Defense is also extending our global footprint by leveraging top line synergies between Gilad, Datapath, and Wavestream by offering a broader range of solutions to defense customers. In the second quarter, over $8 million from Gilad Data Pass systems were ordered by the Israeli Ministry of Defense, demonstrating the strong value of our technology and the applicability of our solutions to diverse mission requirements. During the second quarter, Gilad Data Pass was awarded a contract to provide the field service and technical services in support of the U.S. Army. The award includes an initial order of more than $7 million with an option to extend the program for up to five years, reaching estimated order of up to $70 million. With a clear strategy, a growing global presence, and unwavering focus on mission-critical connectivity, GILAC defends its position for substantial growth and long-term impact in this essential sector. Turn to our commercial business. Q2 was a milestone quarter driven by strong bookings, strategic wins, and continued adoption of our next-generation satellite communication platform. Our momentum reflects both the accelerating transformation of the industry and Gilad's success in aligning the technology and solutions with the need of our customers. One of the most significant announcements this quarter was the signing of a $40 million contract for a virtualized Skyhawk platform. This landmark agreement not only demonstrate the trust our customer place in Gilad, but also highlight the critical industry shift in our satellite communication infrastructure is being deployed. SkyH4 virtualization empowers operators to move to cloud-native software-defined environments designed for scale, agility, and interoperability with next generation satellites. Evolving to a software-only cloud-based platform elevates Gilad's positioning with higher value, improved margins, and provides the option to sell through a platform as a service business model. During the second quarter, we announced over $47 million in orders from tier one satellite operators. These orders underscored the surging demand for Gilad multi-hole with ground segment technologies, driven by increasing demand for IFC solutions and the widespread adoption of GEO, MEO, and LEO architectures. Operators are making substantial investment in ground system that can seamlessly manage multi-OB connectivity across a range of use cases, including fixed broadband mobility solutions and critical government services. These orders also span multiple regions and program types, including both network expansions and new deployments, highlighting the global relevance of our technology and the growing trust in our platform to support mission-critical services. Moving on to Stellar Blue, we announced receiving $27 million in orders from our Stellar Blue portfolio. With more than 150,000 community flight hours and deployment of over 225 terminals, Gilad Sidewinder ESA terminal is exceeding expectations for performance, reliability, and user experience. Production ramp-up is progressing slowly, and we expect to see more units delivered in Q3 and Q4 this year with better margins. Stellar Blue continues to work closely with its partners to secure new fleet wins. We are confident these efforts will yield positive results soon. Looking ahead, we remain focused on expanding our leadership across key verticals and deepening our relationship with strategic partners. With strong customer demand and differentiated technology portfolio, we believe Gilad is well positioned for continued growth in our commercial businesses. Q2 was an outstanding quarter for Gilad Peru, highlighted by the award of more than $60 million in new orders from Puanatel. As a reminder, these orders were delayed last quarter. The awards are for upgrading the regional network infrastructure that was originally awarded to us in 2016, bringing high-speed internet to more than 800 public institutions, including schools, health care, and police stations across more than 280 localities. This award reflects Gilad Peru's continued partnership with the Peruvian state and our longstanding commitment to digital inclusion, demonstrating once again the key role Gilad Peru plays in delivering meaningful nationwide impact. Digital inclusion is a key priority worldwide and the expertise developed by Gilad Peru in connecting remote and underserved communities is now being leveraged in other regions around the world allowing us to replicate proven models and accelerate similar projects globally. In Peru, we still expect to receive several large RFPs and orders from existing project expansions and renewals in the coming few quarters. I am pleased to say that we continue to have a strong backlog and a healthy pipeline of opportunities in all divisions. On the strength of our results here today, improved visibility and business momentum We are resetting our full year guidance. We are narrowing our revenue range to $435 to $455 million for a higher revenue growth rate of approximately 46% at the midpoint. We have also narrowed our adjusted EBITDA guidance range, now targeting between 50 to $53 million for a higher growth rate of approximately 22% at the midpoint. ELAT remains strategically well positioned for sustained for secure, high-performance connectivity across commercial and defense markets. As satellite networks evolve, expanding in capacity, shifting to multi-orbit, geo, MEO, and LEO architecture, and moving towards software-defined infrastructure, our portfolio is uniquely equipped to meet these emerging requirements with the scalability, flexibility, and reliability our customers expect. Gilad Defense continues with a focused roadmap and expanding sales resources broaden engagement and awareness of our technological expertise and our role in supporting the mission-critical satellite connectivity needs of governments and defense agencies in the U.S. and allied countries. In our commercial division, we are meeting the growing industry demands for virtualized, software-defined ground infrastructure that enables more agile, scalable network deployments. Our multi-orbit platforms are delivering seamless connectivity Gilad as a key enabler of next-generation satellite networks. At the same time, Gilad's site in the ISA terminal continues to gain traction with ongoing progress in integration and certification across multiple aviation segments. In Peru, we play a vital role in expanding access to digital inclusion services, strengthening public infrastructure, and supporting long-term national connectivity goals. Our local presence and trusted partnership with the Peruvian state remains key differentiation as we help close the digital divide in under-served regions. We are very happy with the progress we are making across the company and remain focused on advancing our priorities, deepening customer relationship, and delivering meaningful results as we support the evolving needs of a rapidly changing satellite communication market. And with that, I will hand over the call to Gil Benyaminia, CFO.