Eutelsat Faces Revenue Decline Amid Rising Government Satellite Demand

Eutelsat reported first-quarter revenue decline as video sales drop, overshadowing strong demand for government satellite services. Despite connectivity and government services boosting prospects, video revenues fell due to market trends and sanctions on Russian channels. Eutelsat's prospects include home-grown satellite alternatives with an emphasis on connectivity demand growth.

French satellite operator Eutelsat reported a disappointing first-quarter revenue, falling short of expectations due to a sharp decline in video sales. Strong demand in government services, particularly in Ukraine, couldn't offset the 1.2% revenue drop in video, connectivity, and government services to 283 million euros, below analysts' 295 million euros forecast.

The video segment, which contributes 47% of Eutelsat's total revenue, suffered a 10.5% decrease compared to last year. This fall highlights both a persistent decline in the video market and the impact of sanctions on Russian channels, as directed by French regulators.

Despite owning a significant number of Low Earth Orbit satellites through its OneWeb subsidiary, Eutelsat faces slow growth. The video sector's challenges contrast with the rapid rise in demand for satellite connectivity, although government services show promising growth, with revenues up 18.5% to 52.4 million euros from a year ago.

(With inputs from agencies.)