ViaSat, Inc.

Thank you for standing by. My name is Meg and I will be your conference operator today. At this time, I would like to welcome everyone to the second quarter 2025 ViyaSAT earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad. And if you would like to withdraw your question, press the star 1 again. Thank you. And now, I would like to turn the call over to Lisa Curran, Vice President, Investor Relations. Please go ahead.

Thanks, Meg. We will present certain non-GAAP financial measures on today's call. Information required by the SEC relating to these non-GAAP financial measures is available in our Q2 fiscal year 25 shareholder letter on the investor relations section of our website. During the presentation, we will describe certain of the more significant factors that impacted year-over-year performance. We will also make forward-looking statements within the meaning of the federal securities law, including statements regarding events or developments that we expect or anticipate will or may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties. And actual results might differ materially from any forward-looking statements that we make today. Information regarding these factors that may cause actual results to differ materially from these forward-looking statements is available in our SEC filings, including our annual report on Form 10-K. These forward-looking statements speak only as of the date they are made, and we do not assume any obligation to update any forward-looking statements. With that, I'll turn it over to Mark Dankford, Chairman and CEO.

Good afternoon, and thanks for joining us today. With me, along with Lisa, we have Guru Gaurapan, our president, Gary Chase, our CFO, and Sean Duffy, our chief accounting officer. We encourage reading the shareholder letter and referencing the slides we posted on our website earlier this afternoon for more details. I'll give a quick overview of the shareholder letter. Guru will briefly cover operations, and Gary will cover our financial results and highlights in our growth outlook, and then we'll take questions. Our second quarter fiscal year 2025 results were better than expected in terms of revenue and adjusted EBITDA growth, as described in the shareholder letter and slides. We also continue to take actions to strengthen our capital structure, including an upsized refinancing of nearly $2 billion of 2026 secured notes. New contract awards in the second quarter were a new record at about $1.3 billion and were led by Defense and Advanced Technologies, which doubled in year-over-year awards led by cybersecurity, ground systems and space and mission systems, and by aviation connectivity services. Our recent teach-in highlighted the attractive growth potential and durable competitive advantages in key technologies such as next-generation free space optical technology, mission-specific phased array terminals, space-based cybersecurity, and others. Our Q2 Defense and Advanced Technology, or DAF, awards reinforce that we're on the right track, including the U.S. government program, international government opportunities, and certain commercial markets. One of the unifying themes among our customers is access to a diverse set of orbits, spectrum, and constellations, and avoiding over-dependence on single individual systems. Of course, we understand the intensity of competition in some of the core businesses, That makes the size, competitive positioning, and growth prospects of these data opportunities especially exciting. We're open-minded about the best ways to capitalize on these opportunities and are actively evaluating alternatives. All those businesses are both delivering growth and increasing their potential. We're also very pleased to have Gary Chase join us as our new CFO. Gary's leadership experience in strategic, operational, and financial planning will augment our focus on cash conversion. return on capital, converting to a more balanced capital structure, and operating financial profile. Gary will provide additional experience financial leadership on the areas we highlighted last quarter, including identifying, evaluating, and executing the best alternatives to realize a value-embedded business portfolio, leading detailed business operations financial reviews to ensure we're at operational productivity levels with corresponding margin performance, and leading detailed capital allocation reviews to ensure we're optimizing return on capital in the near and long term. The main point is we're exploring additional financial and capital structure perspectives. We're also continuing to drive down capital intensity by augmenting our own satellites through both tactical and strategic third-party agreements. We're in advanced discussions with Telesat to buy Cape and Leo capacity. By leveraging our own fleet and its unique capabilities, existing national operator partnerships, and unique coverage and or capabilities of additional third-party satellites and constellations, we can both ensure our customers are getting the performance and coverage they need and more explicitly measure and drive improved returns on capital. Our satellite operator partners are often national space champions in key countries and geographic regions. and they're seeking a robust global space ecosystem to support their own national security and sovereignty. We're working with both GSO and NGSO systems. Gary will provide more color on capital spending in his remarks. Other key corporate initiatives include evolving LBAN to create value for the millions of people that depend on its use for safety and time activity in the air, at sea, and on land. We have a very significant opportunity to also concurrently greatly expand our addressable market through these evolved services and by leveraging the non-terrestrial network and directed device standards and open architecture enabling multi-tenant satellites. We see multiple avenues to create value for our shareholders, customers, and partners and continue to work with like-minded mobile satellite service operators through the Mobile Satellite Services Association. And last, but certainly not least, We're focused on getting our satellites under construction into service. We've already accumulated substantial in-flight connectivity, operational performance experience with ISAT-3 Flight 1 that reinforces the value of its dynamic beamforming technology to apply all its bandwidth in the most important places, especially for mobility applications. It's clear that being able to effectively dedicate beams to airplanes drives performance. We continue to work on and make progress on our satellite roadmap. Now, touching on the business areas, expected declines in fixed broadband remain our single biggest headwind, but that headwind is decelerating. We're seeing increased global enterprise fixed opportunities, and we'll report on those as they mature. We're seeing declines in maritime revenue, primarily prior generation L-band fleet broadband, and that's been going on for several years. The fleet broadband declines are meaningful, but also decelerating. KA Broadband Maritime or Fleet Express is experiencing much more modest deployments in revenue while largely retaining net vessel count. The multi-orbit, multi-band Nexus Wave product is now in beta trials and doing well and already leading to full-scale deployments for some initial customers. We already have an order pipeline of over 100 customers representing about 3,500 vessels. About a third of those are new customers, offering a good opportunity to increase net vessels. We'll continue to update the maritime outlet based on market data and installation rates, but our overall confidence is building. Longer term, we see further maritime addressable market opportunities with evolved LVAN. Commercial and business aviation are growing well. New OEM aircraft delivery constraints are a bottleneck to active tail count, and the Boeing strike added to that issue. We've been working through the near-term capacity challenges associated with the Biosat-3 Flight 1 antenna anomaly and are making steady progress with network reconfigurations and expansion to serve our customers and expected growth. We've already been doing multi-orbit government aviation and are definitizing extending multi-orbit and multi-band to all our aviation verticals. We believe that multi-orbit, combined with our existing and planned Owned and partnered satellite fleet will be very, very competitive. U.S. and international government are also growing well with opportunities for both technology and service businesses. Key themes for us include multi-orbit, multi-band integration and management, product and technology solutions, advanced platform-specific phased array antennas, space-based cyber, next-generation laser link, and space payload technologies. We see accelerating growth here, obviously reinforced by the exceptional second quarter awards. Gary will provide more color on the financial aspect of many of these points in his portion.