Telesat CEO touts ‘defence use cases’ for LEO satellites as firm’s revenues fall in Q3

November 4, 2025

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Telesat’s CEO says an expected surge in defence spending among Western nations over the next decade could be a boon for the Ottawa-based satellite systems provider’s bottom line as it prepares to launch a cutting-edge new constellation. Telesat announced its third-quarter earnings Tuesday morning, just hours before the federal government was slated to table a budget that was expected to include billions of dollars in additional defence spending. Canada and its NATO allies have agreed to spend five per cent of their gross domestic product on defence as the war in Ukraine continues and disputes simmer in other parts of the world. In a conference call with analysts later Tuesday, Telesat CEO Dan Goldberg said the company’s low-Earth-orbit satellites that are expected to begin service in 2027 will initially focus mainly on delivering high-speed internet to customers in remote regions and hard-to-reach locations such as airliners and cruise ships. But Goldberg said he believes the new LEO network, dubbed Lightspeed, will also have “great utility for defence use cases” as governments around the world ramp up military spending. He noted that Arctic sovereignty is becoming a hot topic in Canadian defence circles, adding the federal government will likely be “spending a lot of money with its allies” to meet its rising defence obligations in the North. That means “there’s some expectation that the allies will in turn reciprocally be contracting with Canadian providers,” Goldberg said. “All of those things give us a great deal of optimism about us to grow our business and leverage Lightspeed for those defence requirements, both with the government of Canada and Canada’s allies.” In response to an analyst’s question later in the call, Goldberg said Telesat is also well-equipped to make “excellent contributions” to the Golden Dome, a proposed U.S. missile defence system aimed at protecting North America from various missile threats. Defence Minister David McGuinty said last month Canada is in talks with Washington about the need to “detect what’s coming at us,” and the feds have broadly hinted that they’re looking at more integrated air and missile defence capabilities. Goldberg suggested Telesat’s technology could play a key role in boosting those capabilities. “We think of Golden Dome as another one of those defence opportunities that could be very accretive to the border Lightspeed business case,” he said. Goldberg told analysts Telesat is targeting a December 2026 launch date for the first LEO satellites in the US$3.5-billion Lightspeed project. It expects to spend several months testing the new devices with customers as well as MDA, which is manufacturing the satellites, and other partners. The company plans to launch commercial service the following year once 96 satellites are in orbit and is aiming to have 156 dishes circling the Earth by the end of 2027. Goldberg said Telesat already has deals in place with teleport providers in Europe and Australia and is building several of its own in Canada. “We’re absolutely where we need to be in terms of the rollout of our landing station infrastructure,” he said. Asked whether economic challenges such as tariffs are posing any potential roadblocks to a timely delivery of Lightspeed, Goldberg said production of the satellites is proceeding according to plan at MDA’s factory outside Montreal. “As far as we can tell from MDA, they’re not being adversely impacted by the tariffs that are out there,” he added. Telesat is banking on Lightspeed to make it a major player in the emerging market for lower-latency LEO satellites that can deliver faster and more reliable internet service to remote regions and users in harder-to-reach locations. Other well-heeled competitors, including Elon Musk’s Starlink, have already entered the market. But Goldberg said Tuesday Telesat is “seeing strong interest” from potential customers looking to sign on to Lightspeed, especially governments and airlines. The company said its order backlog for LEO services is now about $1.1 billion. Until Lightspeed is operational, however, Telesat’s balance sheet continues to take a hit as the company shifts its focus from traditional GEO satellite services to the new technology. Overall revenues for the quarter ending Sept. 30 were $101 million, a 27 per cent drop from a year earlier as current customers such as Dish Network renewed contracts at lower rates and others reduced services. The firm’s adjusted EBITDA fell 51 per cent year-over-year to $47 million. Telesat posted a net loss of $121 million in the third quarter, compared with a profit of $68 million in the same period a year ago. Telesat attributed the swing to several factors, including lower revenues combined with a foreign exchange loss, a loss associated with the changes in the fair value of the Telesat Lightspeed financing warrants, and a gain on repurchase of debt recorded in 2024. The company reiterated its previous guidance, saying it expects to generate revenues of between $405 million and $425 million in fiscal 2025. Telesat shares were down $1.75, or 4.2 per cent, to $39.80 in late-afternoon trading on the Toronto Stock Exchange.