Globalstar, Inc. 10-Q Summary: Q2 2026
Business Context and Reporting Period
This report covers the quarterly period ended June 30, 2026. Globalstar, Inc. provides Mobile Satellite Services (MSS), including wholesale capacity services to Apple Inc. (the "Customer"), commercial IoT, SPOT, and Duplex subscriber services, and government services. The Company operates a single reportable segment. A material development during the period was the entry into a Merger Agreement on April 13, 2026, with Amazon.com, Inc., pending regulatory approvals and other closing conditions.
Key Financial Metrics
| Metric | Q2 2026 (3 Months) | Q2 2025 (3 Months) | YTD 2026 (6 Months) | YTD 2025 (6 Months) |
|---|---|---|---|---|
| Total Revenue | $64.8 million | $67.1 million | $134.8 million | $127.2 million |
| Net (Loss) Income | $(26.5) million | $19.2 million | $(41.4) million | $1.9 million |
| Operating (Loss) Income | $(4.8) million | $6.1 million | $3.4 million | $(2.4) million |
| Diluted EPS | $(0.23) | $0.13 | $(0.36) | $(0.03) |
| Cash and Equivalents | $409.8 million (as of June 30, 2026) | |||
| Long-Term Debt (Principal) | $423.7 million (as of June 30, 2026) | |||
| Operating Cash Flow (YTD) | $159.8 million |
Material Changes vs. Prior Period
- Revenue: Total revenue decreased 3% in Q2 2026 compared to Q2 2025, driven by a 5% decline in wholesale capacity services revenue due to timing of service fees. However, YTD revenue increased 6% due to growth in Commercial IoT and Government services.
- Profitability: The Company reported a net loss of $26.5 million in Q2 2026, a reversal from a $19.2 million net income in Q2 2025. This was primarily driven by a $13.2 million increase in net interest expense and a $13.3 million increase in Marketing, General, and Administrative (MG&A) expenses.
- Expenses: MG&A expenses rose significantly due to transaction costs related to the pending Amazon merger. Stock-based compensation decreased by $3.2 million as performance-based awards from 2023 were fully recognized.
- Accounting Changes: The Company adopted ASU 2025-07 on January 1, 2026, resulting in the derecognition of a $114.5 million embedded derivative asset associated with the 2024 Debt Repayment. This eliminated mark-to-market volatility in earnings related to this instrument.
Guidance, Outlook, and Risks
- Pending Merger: The Company is in the process of merging with Amazon. Shareholders may elect to receive $90 per share in cash or Amazon stock. The deal is subject to regulatory approvals (HSR waiting period expired July 17, 2026) and the achievement of specific satellite milestones. Failure to close could result in a termination fee of approximately $420 million payable to Amazon.
- Operational Milestones: The first set of replacement satellites was delivered in April 2026 and re-delivered in July 2026, with launch scheduled for August 2026. Achievement of these milestones is critical for the Merger Consideration and for reducing accrued fees on the 2024 Debt Repayment.
- Liquidity: The Company holds $409.8 million in cash. Liquidity is supported by operating cash flows and prepayments from the Customer (Infrastructure Prepayment). Capital expenditures for the Extended MSS Network remain high, with $208.3 million used in investing activities YTD 2026.
- Risks: Key risks include the failure to obtain regulatory approvals for the merger, delays in satellite launches, and the potential downward adjustment of merger consideration if operational milestones are not met.
Investor Verification Checklist
- Merger Status: Verify the current status of regulatory approvals (FCC, French authorities) and the timeline for closing the Amazon merger.
- Satellite Launch Schedule: Confirm the August 2026 launch date for the first set of replacement satellites and the progress of the second set.
- Customer Concentration: Note that the Customer (Apple) accounted for 64% of total revenue YTD 2026; assess the impact of any potential contract amendments or terminations.
- Debt Obligations: Review the terms of the 2024 Debt Repayment and 2023 Funding Agreement, specifically the milestone-based fee reductions and repayment schedules.
- Accounting Impact: Understand the full financial impact of the ASU 2025-07 adoption on future earnings volatility regarding the embedded derivative.